Mungo MacCallum- Political Corrections

Paying the price for ad hoc policies

Once more John Howards opportunism, mendacity and humbuggery have come back to haunt him.

As petrol prices rise inexorably towards the $1.50 a litre mark and the public anger grows, our Dear Leader pleads for understanding: its all a matter of supply and demand, its because Chinas demand for energy is insatiable, its because of hurricanes in America and instability in the Middle East (though not, of course, his war in Iraq), its an international problem and hes really, truly, honestly not to blame.

Hed just love to bring the cost to the motorist down, he recognises it as his greatest problem, but theres absolutely nothing he can do, fair dinkum cross my heart.

And people just dont believe him. They dont believe him because they know if they carry on loudly enough and for long enough that Howard will make the price come down, and the reason they know this is because it has all happened before.

When the price rose at the beginning of 2001 there was a huge outcry, and the government, already somewhat spooked by unfavourable opinion polls, went into a flat panic. Not only did the bush receive a veritable cornucopia of fuel subsidies ranging from the easily rortable through to the utterly inequitable and the frankly unworkable, but Howard knocked a sizeable chunk off federal government excise and abandoned the indexation of excise altogether.

This sent a firm signal to the industry that petrol was king and would continue to be king until it ran out altogether: there was to be no serious attempt to ration an increasingly scarce resource through the use of the market, and the search for alternatives was to be seen as an unnecessary frippery.

And if the message didnt get through in 2001 it was heavily reinforced three years later when Howard offered a pre-election bribe of another $1.5 billion in subsidies both to off-road farm vehicles and to long-haul transport, a policy which became abbreviated as Cheap Diesel for Big Trucks. Just fill up at the nearest pump and dont worry about the cost; the government will look after it.

But although the main beneficiaries of this squandermania were the farmers and the truckies, the message was clear to all motorists indeed, to all consumers: if you just make enough fuss, if you hold your breath till you turn blue in the face and then scream and scream and scream till youre sick, Johnny will buy you an ice cream. Hell keep telling you no, but he doesnt really mean it.

The problem is that this time he does mean it; he really has to. He simply cant afford to lose any more of the excise; as he himself has pointed out, to cut the excise by even 10 cents a litre would cost the budget around $4 billion a year and with the price of petrol likely to keep rising it would do very little political good. There are more profitable ways of spending $4 billion in the lead up to an election year (extra funds for political junk mail, for instance) and there have to be cheaper ways to divert the publics attention.

It is probably too late to try and educate them to the fact that Australia has cheaper petrol than almost anywhere outside the United States and the Middle East itself, or to tell them that they were silly to buy that huge 4WD gas guzzler just to drive the kids half a kilometre from the McMansion to the local private school: Howard has pandered to the greed of the electorate for far too long to start preaching restraint now.

The tokenism of a touch of ethanol in every tank appeals, once again, to the farmers but does almost nothing to reduce costs to the motorist and absolutely nothing to promote fuel conservation, which is the real problem. The subsidy for those who already overuse their vehicles to convert to gas is another piece of panic-driven economic nonsense: it will simply push up the price of gas (supply and demand again, Prime Minister) and in any case, the gas is to become subject to excise in a few years so the price will rise anyway. It is, after all, a by-product of the same crude oil from which we refine our petrol, and will run out at the same time. This is not a policy it is pure political adhockery.

But since political adhockery has driven this governments approach to fuel for the whole of the last decade, we have no reason to be surprised. And deep down we are still convinced that if we throw a big enough tantrum, that same adhockery will give us back petrol at a dollar a litre.

But then, we believed that hed keep interest rates low, too. Some voters will never learn.

Another example of Howards adhockery (he himself would, of course, describe it as realistic and pragmatic government that pays due attention to public concern) is the decision to allow a free vote on bringing embryonic stem cell research up to the level that operates in most other countries.

The very idea has further unhinged Tony Abbott, who has warned that such legislation would turn Australia into some kind of Island of Dr Moreau in which mad scientists would create half-human monsters and release them to terrorise the populace. Such statements might suggest that Abbott is unfit to occupy the office of health minister, or indeed any room that lacks well padded walls and a secure lock on the door.

But then, what else would you expect from the Mad Monk, whose own idea of medical research consists of an annual pilgrimage to Lourdes?

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