Bullets dodged, stars aligned as nation’s outlook is transformed

Two dramatic events have transformed Australia. First, we have dodged an incredibly dangerous bullet, and second a remarkable set of bullish economic stars are suddenly aligned. I learned yesterday that one of Australia’s largest home builders was planning a substantial reduction in its work force next week had Bill Shorten won the election.

Others would have quickly followed and, indeed, some home builders had already started their ALP-driven retrenchment program. Those mass sackings would have triggered a steep decline.

The simple fact was that for the last six months very few home sites were sold and the home building industry was facing a deep slump in early 2020, and adjustments had been made in advance.

At such a time the negative gearing clamps would have been catastrophic. There will still need to be some staff cuts among builders because the pipeline is empty but they will not be nearly as savage.

Thanks to Australia’s more than one million retirees and the pressure from Adani, Scott Morrison is now the prime minister in the 46th parliament.

The truth is that Scott Morrison should have acted earlier but so too should have the Australian Prudential Regulation Authority.

Back in January the arrogant APRA organisation was declaring that its seven per cent interest rate serviceability floor was “intended to be permanent”.

It was clearly out of touch with the real world. Now it understands the looming crisis and has replaced its “permanent” cap with a 2.5 per cent buffer above borrowing rates which affectively increases bank lending by about 8 per cent.

Many journalists, including myself, had been urging the Morrison government before the election to explain to APRA the damage the regulator’s credit squeeze was causing. No doubt had APRA had not acted this week the Morrison government would have put incredible pressure on it to ease the credit squeeze.

But suddenly the pending disaster has been averted and it changes the outlook for the nation.

The share market boost reflects the transformed outlook and the increased value of franking credits.

While there are plenty of hazards ahead just look at what has happened: APRA now understands what is taking place in the economy and has weakened the credit squeeze; negative gearing will now remain; around 1.1 million battling retires won’t have to shell out on average of $4000 each via the retirement and pensioners tax; there is a low to middle income tax cut in the pipeline; interest rates will be cut; the fear among small businesses that wages were set to go through the roof has been removed and among the banks there is a greater willingness to lend.

Assuming the government carries out its unfair contract promises, the small business tax tribunal is made to work, and the government makes sure that payments by government and most major enterprises are within 30 days, we will develop enormous momentum in the economy. With that momentum will come a whole raft of cash flow-based lending opportunities to support small and medium businesses without using their homes.

On top of all this the Morrison government’s long overdue plan to enable lower income people to buy houses on a five per cent deposit will create at least 10,000 new homes and as the loan repayments come in, if the government is smart, it will invest the proceeds in new homes so in time, instead of 10,000 new homes, there will be a much greater number generated. It’s the right policy for this time.

It is too early to see a sudden swing to people building homes and buying land but the building development industry has no doubt that there will be a substantial increase in demand.

The real estate market will not return to boom because there is still a credit squeeze but further big falls are off the table. And there will be improvement in some areas.

I have had the chance in the last 48 hours to talk to a lot of small and middle sized businesses and the phone has been running hot because of my role in the mobilisation of retirees.

Everywhere there is a feeling of incredible relief and in due course that relief will be reflected in confidence.

We still have very large infrastructure spending in Victoria and New South Wales which provides a further boost.

Part of the reason for the increased momentum is the sheer energy of the Prime Minister during the campaign. He was able to mix with a host of small businesses plus ordinary people in an attempt to infect them with his confidence.

On the question of confidence, we often hear from bankers that there is no confidence in the community, but that lack of confidence was actually created by the banks themselves, plus APRA and ASIC. Nevertheless we need to make sure that we do not go back to the unlimited credit that created the boom.

At the moment Scott Morrison is on a honeymoon and with Tony Abbott no longer in the parliament he has the freedom to cast a new environment policy if he feels it necessary and make other policy adjustments. In fact he has a blank canvas.

Finally, we all understood that the ALP’s negative gearing plan would have reduced the value of existing houses, which in turn would have affected bank lending and the willingness of people to buy houses.

What I didn’t appreciate was that a vast number of younger people had planned to buy a house to live in and had in the back of their minds that they might travel or move to another state for a time and during that time negatively gear their house.

With the Labor rules they couldn’t embrace that strategy. Accordingly they were completely taken out of the housing market. They are about to come back.

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Education policy challenges for Australia

If Scott Morrison does what he said last week he would do and reappoints Dan Tehan to the education portfolio if he won the election, then we might at last see what this minister is about.

Since last August, when Morrison appointed him after the coup against Malcolm Turnbull, Tehan has mainly kept his counsel.

He’s been most vocal in speaking up for regional universities, pressing for more revenue-generating international students to go bush. He made a mild intervention in the culture wars, appointing former chief justice Robert French to review freedom of speech in universities. And, significantly, he started a possibly far-reaching review into so-called provider category standards which could open the way to a new model of tertiary education. But that’s been about it.

The elephant in the room — how universities will be funded when the present freeze ends next year, and how the lift in demand for university places from the Costello baby boom will be met — was left unaddressed.

As the Grattan Institute’s ­Andrew Norton points out, the Morrison government needs to deal with the bulge in university-aged young people caused by the Howard government, which, at the height of the resource boom in the early 2000s, lavished money on new parents through a generous baby bonus scheme worth up to $5000.

It was then treasurer Peter Costello who urged parents to have one for mum, one for dad and one for the country.

Now another Coalition government has to deal with the fiscal consequences as the growth in the number of 18-year-olds starts rising next year and peaks in 2024.

The government’s stated plan, to index growth of university funding to the adult population of the whole country from next year, doesn’t have a hope of keeping pace with this level of demand.

To be fair, Tehan inher­ited the university funding policy and higher education was not a priority of the government’s election campaign. So he let it sit. But now he’s going to have to pick up the baton and do something.

Tehan also faces another ­related crisis. As he is well aware, Australian universities have divided into the haves and the have-nots. The generally richer institutions are getting even richer from enrolling international students and the poorer ones are often missing out on this academic equivalent of the gold rush.

Following the imposition of the Turnbull government funding freeze in late 2017, cash-strapped universities turned to inter­national students for revenue. But it’s a crowded market and some compromised on academic standards and English proficiency to win students.

Now this volatile situation, which threatens to damage Australia’s reputation, needs to be sorted out and Tehan looks like being the one in the hot seat.

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'I'll burn for you': Pentecostal PM energises Christian voters

Scott Morrison declared his election victory a “miracle,” told an interviewer he saw people as “agents of God’s love” and used a National Press Club address to promise voters “I will burn for you” - a phrase used by some Pentecostal Christians to signify working tirelessly, often for Jesus.

One of his first acts during the campaign was to allow the cameras to record him worshipping at his church, Horizon.

Mr Morrison is not the first government leader of faith (John Howard, Kevin Rudd and Tony Abbott were all Christians) but in his political language, the re-elected Prime Minister is arguably the most overt.

According to the Australian Christian Lobby’s Martyn Iles, this language - coupled with the PM’s support for religious freedom - is re-energising religious communities and turning them to the Liberal Party.

“It does give people of faith a degree of confidence when they see a Prime Minister who is clearly Christian,” Mr Iles said.
“It doesn’t surprise me when it seems like religious communities played a role in the rising support for the Liberal Party, because I think that confidence probably did play into the psychology of their vote.”

Macquarie University professor Marion Maddox, an expert on the intersection of faith and politics, said Mr Morrison’s overtly religious language was “unfamiliar territory for Australian politics”.

But it comes at a time when trust in politics has been eroded, so it could appeal to a much broader audience than just those who already have faith.

“It's saying: I have a belief in something bigger than myself, I have a belief in ideals," Dr Maddox said. "It's particularly useful when party ideology is no longer a ready reference point.”

Preliminary analysis of Australian Electoral Commission and census data suggests that a number of the key seats that swung against Labor overlap with higher-than-national-average rates of Christian households.

The seats include the Queensland seats of Herbert and Longman, where Christianity makes up the biggest religious grouping in those electorates (65 per cent and 62.4 per cent, respectively) and the Tasmanian seat of Braddon (58 per cent).

In Victoria, volatile electorates such as Deakin cut through Melbourne’s outer eastern “bible belt” and have a tendency to switch between the parties. But this also remained Liberal this year, defying Labor's hopes.

At this election, the Australian Christian Lobby also ran its first ever federal field campaign, which pointed out where the parties stood on issues such as “supporting faith-based schools to uphold their values”; “the legalisation of assisted suicide” and the “public funding of abortion”.

They distributed hundreds of thousands of leaflets, made phone calls, and undertook an extensive online campaign across six electorates: Chisholm in Victoria; Boothby in South Australia, Bass in Tasmania, Canning in Western Australia; Petrie in Queensland and McMahon in NSW. Most, with the exception of Boothby and Chisholm, recorded anti-Labor swings.

Mr Morrison’s social media platforms now show thousands of comments from people expressing religious sentiments in support of his re-election.

“Congratulations Prime Minister! We have been longing for a dedicated Christian leader here in Australia and we finally have one!!!” wrote one voter on his Facebook page. “Can’t wait to see how God is going to work in and through you in this term.”

“May God bless and guide your leadership, Scott! Praise the Lord for this miracle win,” wrote another.

In policy terms, the Australian Christian Lobby has called the Coalition’s victory a “win for religious freedom” and has urged the government to pass a Religious Freedom Act that would enshrine in law clear protections for faith-based groups. Such an act could guarantee that faith-based schools could uphold their teachings on issues such as homosexuality, allowing them to select staff on that basis.

In a written response to religious leaders on May 14, Mr Morrison committed to “providing Australians of religious belief with protections equivalent to those guaranteed in relation to other protected attributes under Commonwealth anti-discrimination law.”

However, in an apparent contradiction, the Liberal Party vowed during the campaign to “redouble” its efforts tackling discrimination against the LGBTI community, starting with the removal of exemptions allowing faith-based schools to expel gay students.

It also wrote to LGBTI lobby group Equality Australia promising to work with the states to tackle gay “conversion” therapy - an ideology and practice that is predominantly pushed by Evangelical ministries.

“We’ll be making sure they keep their promises,” said Equality Australia spokeswoman Anna Brown

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Gender quota ‘offends’ LNP’s new senator Susan McDonald

Incoming senator Susan McDonald has rejected a quota to boost the number of Coalition women in parliament, saying she would be “offended and humiliated” to be preselected because of her gender.

The 49-year-old single mother and businesswoman is Nationals royalty, a scion of one of the wealthiest cattle families in Queensland whose father was a mover and shaker in the party, state and federally. She supports diversity in the workplace and politics, but insists gender is only one element in the mix.

“I would be offended and humiliated if I ever thought I had been given a job based on what I was, as opposed to who I was,” Ms McDonald said. “If you’re willing to disregard all the selection criteria in favour of one, that cannot be a good outcome. I would never run a business like that and I don’t think it’s the way to run the national parliament.”

The Coalition stands to increase its female representation to 27 in the next parliament, up six, but continues to trail Labor, which is close to a 50:50 gender balance. In the House, the Liberal and National parties will have 14 female MPs against Labor’s putative 27, but the major parties are closer in the Senate, where Ms McDonald will lift the number of Coalition women to 13 against 16 for Labor.

She is stepping away from her role as managing director of the McDonald family’s five-outlet Super Butcher chain to enter the Senate on July 1 after being elected in the No 2 spot on the LNP’s Queensland ticket.

The business employs about 80 people and Ms McDonald said she had pushed to promote women provided they were qualified, a lesson that also applied to politics.

“I absolutely wanted more women managers but the moment I made that decision it was a four-year journey for me to ask women to enrol in an apprenticeship, graduate from that apprenticeship and then to start management training,” she said. “If we want to have more women in parliament we have to provide a pathway for them to understand what skill sets are needed to be a representative of the nation, in the same way that we should with men. This is not a gender thing. This is making sure that people are coming fully armed with the skills and experience that we want.”

Her own political journey has had its twists and turns. Her father, Don McDonald, helped rebuild the Queensland National Party after Joh Bjelke-Petersen’s state government was destroyed by corruption scandals in the late 1980s and went on to serve as national president. She grew up at the family station near Cloncurry in northwest Queensland, studied commerce and economics at the University of Queensland and became an accountant.

Ms McDonald understands why Tanya Plibersek bowed out of Labor’s leadership race. In 2006, she was being positioned for a winnable spot on the Senate ticket. But her marriage had broken down and the priority was her three children, then aged between six and two. “I could not be away from them as much as the job ­demanded,” she explained.

“I believe there is an age where women say they are not willing to make that sacrifice. Tanya Plibersek said that this week and I think we have to call out what this is — we need to make a job in politics possible and attractive to everybody, male or female.”

The stars aligned last year when she was preselected at the expense of veteran Nationals senator Barry O’Sullivan, dumped alongside north Queensland-based Liberal Ian Macdonald. Asked if the Coalition needed more women in parliament, Ms McDonald said: “It would be good to have a broader cross section of people in the partyrooms and in the parliament making decisions.’’

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Climate change: Cuttlefish of the Left extend tentacles on climate ‘truth’

Fortunately for all of us, the climate isn’t changing as rapidly as the politics and language around it. What started out as global warming was redefined by proponents as climate change, enabling them to pivot from having to explain record cold snaps to including them in the catch-all of change.

Now the political barometer is generating more language shifts. The alarmists, apparently, haven’t seen enough children crying at climate change protests so they want to up the ante. Left-wing newspaper The Guardian (along with The Guardian Australia online) is leading the crusade with a new dictate to staff — they should refer to the climate issue as an emergency, crisis or breakdown.

The paper’s official style guide has been amended saying the phrase “climate change is no longer considered to accurately reflect the seriousness of the ­situation”.

Wow. That is change you can almost believe in.

Up bobbed the phrase immediately in today’s Australian coverage. The Guardian Australia’s political editor Katharine Murphy covered the election fallout in full compliance. “This was an election in large part about the climate emergency, and the field evidence shows Australia in 2019 is deeply divided about the road ahead,” she wrote.

The Guardian is changing language in a brazen attempt to change politics. Later in the story, Murphy went on: “In his concession, Shorten noted that the ­divisions on the climate crisis were etched into Saturday night’s result.”

But a quick check of the transcript reveals a bit of an accuracy issue. Shorten never referred to a climate crisis. He spoke of “climate change” and “climate action” — guess he hadn’t got the memo.

It hardly needs saying this is the epitome of Orwellian. As ­George Orwell wrote in Politics and the Eng­lish Language: “If thought corrupts language then language can also corrupt thought.”

The Guardian doesn’t like the way you are thinking so it is adopting more emotive language to frighten you into its camp.

As Orwell wrote in his seminal essay: “The great enemy of clear language is insincerity. When there is a gap between one’s real and one’s declared aims, one turns, as it were instinctively, to long words and exhausted idioms, like a cuttlefish spurting out ink.”

And, just like that, you’ll now hear more words such as emergency, crisis and breakdown. Expect ABC reporters to broadcast them, too.

“The Guardian has updated its style guide to introduce terms that more accurately describe the environmental crises facing the world,” the paper said in a statement. “Instead of ‘climate change’, the preferred terms are ‘climate emergency, crisis or breakdown’ and ‘global heating’ is favoured over ‘global warming’, although the original terms are not banned. We want to ensure that we are being scientifically precise while also communicating clearly with readers on this very important issue. The phrase ‘climate change’, for example, sounds rather passive and gentle when what scientists are talking about is a catastrophe for humanity.”

Oh, The Guardian is also sceptical about the word sceptic. Apparently it’s not alarmist enough, either. The thought police have dictated that sceptics are now referred to as “climate science deniers” or “climate deniers” — terms that shamelessly echo the disgrace of Holocaust denial.

Even when they don’t have newsprint editions, the green Left is dealing in ink; like spurting cuttlefish, they want to muddy the waters and won’t be denied.

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 Posted by John J. Ray (M.A.; Ph.D.).    For a daily critique of Leftist activities,  see DISSECTING LEFTISM.  To keep up with attacks on free speech see Tongue Tied. Also, don't forget your daily roundup  of pro-environment but anti-Greenie  news and commentary at GREENIE WATCH .  Email me  here