We all know that the Liberal party MPs are in a world of pain. The polls are diabolical. Political death stares many of them in the face. Whole dollops of the party base, like me, simply will not forgive Mr Turnbull and the 54 defenestrators who tossed out a first term prime minister who had delivered a massive election win so they could hand the leadership over to one of the most left-wing members of the party room.
It was pretty obvious to everyone outside the Ultimo bubble that this was a recipe for disaster, and plain-out stupid for those who complained (rightly in my view) that Mr Abbott had not been right-wing enough. (Think of his sell-out on Section 18C, his tax increases, and his big government Paid Parental Leave Scheme.)
But who in his or her right mind in a supposedly right-of-centre party goes from that, which included big wins in stopping the boats and getting rid of the carbon tax, to Mr Turnbull the failed opposition leader, the global warming zealot, and the man far more at home in an ABC studio than on talk-back radio (if he even knows what the latter is)?
Mr Turnbull is like some sort of reverse alchemist who can take certain political gold – like, say, the politics surrounding the cost of energy and renewables targets – and turn it into worthless, mushy, indistinguishable-from-Labor tripe. It’s as though he possesses a never-before-seen anti-super power.
But as bad as things are for Liberal MPs generally they are far worse for those from Western Australia.
WA voters are just waiting, with baseball bats in hand, to deliver an electoral drubbing to the Libs. It could be a massacre. And a principal reason is the Coalition’s inability, or refusal, to fix the GST distribution.
Let’s be clear. This is political poison, and rightfully so. If I lived in WA I’d be inclined to threaten to vote for a secessionist party, so egregiously idiotic is a system that for every dollar it takes from Western Australians delivers back only 30 cents, possibly now 34. And let me assure all readers that if WA had a separatist party even remotely like the ones in the province of Quebec in my native Canada then the GST problem would be fixed pronto.
The basic problem is that the GST distribution operates on some sort of 1970s Kibbutz/Marxist principle whereby states ‘give according to their ability to pay and receive according to their need – though measured against the fiscally strongest state so that this goal of equalising up is both absurd and literally impossible’. This is incentive killing idiocy. It rewards failure and economic mismanagement no matter how self-inflicted. Just about the only thing it doesn’t take account of is the desire to limit gambling, so even there WA is bizarrely punished.
I know this GST distribution was partly in response to the horrible mess federalism has gotten into in this country, mostly at the hands of our High Court, the most pro-centre top court in the democratic federalist world.
We alone have states with no practical income tax power. We have pretty much the world’s worst vertical fiscal imbalance. We have given up on competitive federalism, the only kind that works (as you see in Germany, Switzerland, Canada and the US). Indeed, we have mendicant states now so conditioned to taking ‘strings attached’ handouts from Canberra that they don’t even want taxing powers that would make them, you know, accountable to the voters in their state.
So the GST was supposed to give states money without the normal strings attached from the feds. It was to be ‘their money’ to use as they thought best (albeit not constitutionally protected). But the formula used to deliver the money, to the extent any living being understands it, is a triumph of opacity and hardline egalitarian outcomes that even Mr Engels would think went too far: it’s that ridiculous. It flat out rewards failure (think South Australia) and punishes success (that’s you WA) while slyly smuggling in the sending of money to the Territories (both big winners under the formula) who are constitutionally Canberra’s responsibility, not that of the states.
Put bluntly, it’s a bureaucratic mess. And WA is being hammered. And don’t tell me how WA for years was a net redistributive recipient because since the GST the monies being redistributed are on a vastly different scale, not to mention that historical support for WA was explicitly to compensate them for the tariffs that hurt export-focussed WA and only benefitted the East. If you live outside WA you have to face the fact that WA is being shafted.
So when WA Liberals go for pre-selection and promise that fixing the GST will be their main focus, and then once in Cabinet come back to Perth and plead ‘it’s all too complicated and tricky’, well, you can imagine what the response will be. Some Lib MPs, treating the voters as fools, even say that it’s out of their hands as only the Commonwealth Grants Commission can change things, when we all know Treasurer Scott Morrison can change things with the stroke of his pen.
Here’s what WA Liberal cabinet ministers could do: they could invoke principle and resign themselves to the backbenches till this is fixed. But when was the last time you saw any Coalition MP do anything to hurt his or her position or perks based on principle? Stumps me too.
Even the former Barnett Coalition WA state government, which made all the right noises and voiced all the right complaints, never roused itself from the plane of saying to the plane of doing. Heck, the Barnett government could simply have refused to approve anything in COAG, or even to attend. It could have blocked everything it legally could and made obstruction its byword. But no, it talked a big game and did nothing.
That pretty much sums up the Team Turnbull MPs from WA. And so as they won’t act, the voters in WA soon will. And rightfully so in my view.
P.S. Nothing in this article is meant as an implicit support for Julie Bishop to take Malcolm Turnbull’s job. The party will implode if any bedwetting assassin of Abbott gets the nod. Are you listening WA Libs?
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