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Friday, 28 June 2013
Page: 4470


Senator MASON (Queensland) (13:37): As we come to the fag end of the 43rd Parliament, it is a good time to assess the government's failures. Many of my colleagues have mentioned some of the failures. None of us are sure whether it is Mr Rudd or Ms Gillard—the Rudd or Gillard government—but it does not make a lot of difference: same policies, same failures; same horse, different jockey.

Over the last few weeks my colleagues have spoken a lot about the mining tax—a tax that very strangely raises no money. Imagine the Labor Party doing that. They actually have a tax that raises no money, the mining tax—one of the gross policy failures. Another great policy failure is the world's largest carbon tax, which will have no impact on the climate. What an appalling policy failure—another one.

Another appalling policy failure has been the asylum seekers—the boat people. We had a policy under the coalition government, under John Howard, that worked. Mr Rudd, the new Prime Minister—Rudd redux—is back—

An honourable senator: Restoration!

Senator MASON: Restoration Rudd—he is back.

The ACTING DEPUTY PRESIDENT ( Senator Bernardi ): Order! Senator Mason, you know you should refer to members in the other place by their appropriate title.

Senator MASON: I apologise. When Mr Rudd was Prime Minister he thought it would be a good idea to soften John Howard's successful boats policy. Why did he do it? Because he thought we were heartless, that we had no ethics. It is this pathetic moral vanity that has undermined Australia's borders. It was the greatest policy failure of the Rudd and Gillard governments, an appalling policy failure, to expose our borders.

But I want to speak about something you cannot always see, that Labor and the Greens want to forget, that is sometimes a little bit harder to touch. My colleagues today have spoken a lot about the fiscal failure of the Labor government. They have spoken about the enormous debt—$178 billion—and the enormous fiscal failure. They have mentioned that the interest on the debt alone would pay for the National Disability Insurance Scheme. We have heard about the great cash-splash, in which people bought flat screen colour televisions. We have heard so much about the overpriced school halls over the years and also the pink batts fiasco. We have done that to death. My colleagues have done a superb job of holding the government to account on the fiscal failure of public debt.

But I want to speak about the moral failure of the government and public debt. We on this side have always known that social democracy is a bit of a con. Essentially, social democracy is a pyramid scheme not only sanctioned by the state but eulogised by it. Social democracy is premised on the assumption that the number of taxpayers and national productivity will continue to grow at a sufficient rate to support growing social welfare. Social democracy is premised on the notion that the number of taxpayers and national productivity will continue to grow at a sufficient rate to support the growing impost on the Treasury of growing social welfare. The government's underlying economic assumptions are based on that.

But social democracy will break down if the number of taxpayers or the productive output of a nation are insufficient to meet the obligations made by government or where the obligations keep increasing because of, for example, increased life expectancy, something states cannot always predict. What has been happening in the West, in the developed world, for at least the past 20 years is that both of these scenarios are happening: there are not enough taxpayers left in the developed world and we are not sufficiently productive to meet our ever-expanding welfare demands. The economy is not sufficiently productive and there are not sufficient taxpayers to meet the increasing imposts on the government of social welfare and recurrent expenditure. And this lot, the government, has to believe that, because that is what they premise their entire political beliefs on.

So what has the developed world been doing to meet these growing welfare demands? They can meet them by borrowing money to pay for them. They can borrow money to pay a welfare bill. You borrow it on the credit card to pay for a welfare bill and to pay for current expenditure. If you do that, you go into debt and you also shift the obligation from the generation that receives the benefits to those who will not. Let me explain what I mean. You are asking, in effect, future generations—your children and your grandchildren—to pay the public debt that our generation is now racking up. Let me just quote from Professor Niall Ferguson, whose The Great Degeneration: HowInstitutions Decay and Economies Dieis based on the BBC Radio 4 Reith lectures for 2012. He says:

The heart of the matter is the way public debt allows the current generation of voters—

that is us—

to live at the expense of those as yet too young to vote or as yet unborn.

We spend their money, we spend their inheritance. He goes on to say:

These mind-boggling numbers represent nothing less than a vast claim by the generation currently retired or about to retire on their children and their grandchildren, who are obliged by current law to find the money in the future …

They have to find the money in the future by submitting either to substantial increases in taxation or to drastic cuts in other forms of public expenditure—that is, in welfare.

What we rack up on the credit card, your children and your grandchildren will have to repay. We are living at their expense throughout the developed world. This is not just a fiscal failure, it is a moral failure. Ferguson goes on to cite the great conservative Edmund Burke. Acting Deputy President Bernardi, I know you are a great devotee of Edmund Burke. Ferguson says:

In enormous intergenerational transfers implied by current fiscal policies, we see a shocking and perhaps unparalleled breach of … partnership.

He says that society is more than just us, the voters. Society includes those who cannot yet vote and those yet unborn. Edmund Burke recognised that all those years ago in the 18th century. Burke recognised that we govern not just for ourselves and not just for our current generation but also for our kids, our grandchildren and those yet unborn. This is not just a fiscal test. It is a moral test.

It is very easy for us to rack up debt. This lot has done it better than anyone else in the history of this country. The Labor and Green alliance has had the five largest budget deficits in Australian history. It is not just a fiscal failure; it is a moral failure. We have to understand that any government governs not just for today but for the future and the future of our children and our grandchildren and those yet unborn. That connection between the generations is the heartbeat of our country. We are responsible not just for the next rent seeker wanting more welfare and not just for another industry asking for protection. Every time we decide to spend more money, we have to decide whether that debt is worth putting on the loan book of our kids and our grandkids.

I just wish western Europe and the United States had thought about that. I know even in my area of universities and research I would love to be able to spend more money. In a way universities and research create much of the productivity and innovation for our country

But every time a government makes a decision about expending more money it must ask this question: does this assist our kids and our grandkids? We cannot allow ourselves to wallow in the financial profligacy that has totally undermined the capacity of Western Europe and the United States. I hear the argument from the other side of the chamber, from the Labor Party and the Greens, that 'it doesn't matter, you've got to spend a bit to get a bit'. That is exactly the argument that has been used throughout Western Europe and the United States since World War 2.

The second that taxpayers cannot raise sufficient tax and productivity starts to fall, guess what happens? Debt starts to rise. Despite the fact that this government has raised debts that have never been seen before in this country, there is no argument that it was all done for our kids or our grandkids—no argument at all. Does anyone actually believe that this government would ever return our budget to surplus? Does anyone believe that? Even more so, does anyone actually believe that the Australian Labor Party and their Greens allies would ever start paying back public debt? They do not even believe it themselves. They would never pay back public debt because they think it is not a bad idea.

The difference between Australia and the rest of the developed world is not the Labor Party, it is the coalition. If the coalition had not won two out of every three federal elections since the end of the Second World War, I can say with absolute certainty: this country would be in systemic debt, just like every other social democratic country on earth. We would have a debt level not of eight or nine per cent but of 30 or 40 or 50 or 60 per cent of GDP, without any doubt. The fact that our country overall has a low public debt is no thanks to them. It is because of the fact that the coalition has won two out of every three elections since World War 2. We are the only reason that Australia is not like the rest of the world with very high public debt. If you do not believe me, just look at the history, ladies and gentlemen. Since 1901, when our nation came into being, every time Labor has left office it has left us further in debt. There is not one exception since the first Labor government, of John Christian Watson, in 1904. I hear the other side going: 'Well, you know, sometimes you've got to fight a world war, Brett, so you go into debt.' Sure, if you have to fight a world war you go into debt. But what never changes, whether Labor governs in good times or bad times, during peace or war, is that always there is more and more public debt. As I said, there has never been an exception in 110 years since the first Labor government.

That is their greatest disgrace. Sure, they failed miserably with asylum seeker policy. We all accept that. The moral vanity of Mr Rudd is absolutely appalling. And, sure, their carbon tax is absolutely pathetic. I can see some friends of mine here this afternoon who fought against the carbon tax. The only way we will ever cut emissions worldwide is through multilateral action if the G20 decides to do something. To act unilaterally like the Labor Party did is ridiculous. There is no way Australia acting by itself and having the world's largest carbon tax will have any impact on climate at all. Zip, as Mr Rudd would say. The asylum seeker policy, the carbon tax and, of course, the mining tax that raised no money are all appalling, shocking failures. But the greatest failure, the moral failure, is the public debt. That side, the Labor Party and the Greens, always talk about social justice, and everyone on this side is sick to death of hearing about how they believe in fairness, equity and justice and that the coalition does not give a damn about fairness, equity and justice. That is what they always argue. The greatest moral failure of the Labor Party and the Greens, I swear to you, Acting Deputy President Bernardi, will be the debt that this lot impose on your children and your grandchildren—and they will do it, because they have done it since Federation and they have never, ever changed their spots.

We have a new Treasurer, Mr Bowen, and Mr Rudd is again casting himself as an economic conservative. Remember, he was a social democrat; when he ran for office in 2007, you will recall, he became an economic conservative; and then he abandoned economic conservatism because of the global financial crisis and became a born-again Keynesian, a born-again social democrat. Then he realised one very important thing. He realised that his entire political belief system was wrong. He argued his economic belief that only social democracy—only Mr Rudd, really—could save capitalism, could save liberal democracy. And what have we learnt in the last six years of a Labor government about the world economy? We have learnt that the only people that can save social democracy, the only people that can pay for their spending, are liberal democrats—those who believe in entrepreneurial activity, entrepreneurship, business and capitalism. In the end, in the Western world, capitalism and entrepreneurial activity will have to save social democracy. That is the change. This lot, under Mr Rudd, argued that the only thing that would save the United States and Western Europe was social democracy. Now we know that is wrong. The only thing that will save social democracy is liberal democracy. He even got that wrong. Not only has Mr Rudd abandoned his economic theories yet again, for the third time—he has changed his economic clothing three times; worse than that is the shocking moral failure of Kevin Rudd and the Labor Party.

If I believed even for a second that this lot would start paying back public debt, would force my generation to live within its means, just like householders have to live within their means, I would give them some credit. But I know they have absolutely no intention of living within their means. They will throw around largesse to try to win votes, they will promise the world and they will put our kids and grandchildren in debt. That is the great economic, social and moral failure of the Left not only in Australia but also in the Western world.

When it comes to the next election, our party is seeking to govern not just for our generation, for you ladies and gentlemen in the public gallery; we are seeking to govern for your kids, your grandkids and all children yet unborn.