Shocker budget coming

Vanguard April 2011 p. 3

The next federal budget is due to be announced on May 10 and will take effect on July 1. At the time of writing, it is in the process of being put together. Much of its content has not seen the light of day yet. But one thing is certain. It is going to be a shocker.

Leaks and hints provided by the Prime Minister and relevant ministers tell us that Australians can expect plenty of cut-backs in government departments and projects. The focus of the cutbacks will be on a range of services that are important to most.

Ending the budget deficit over the next three years, they keep telling us, is for the good of the economy. It is a Goebbels-like lie, based on the notion that if it is repeated enough times people will come to believe it.

Not even the costs of the floods and cyclone Yasi can be allowed to impact on this objective. On March 23, Treasurer Wayne Swan said the government would have to “Do a lot of things in this budget that won’t be popular” to achieve the surplus it promised. Budget surpluses aim to protect big business profit interests and save monopoly capitalism from crashing under the weight of its own crisis.

The Gillard Labor government continues to implement the imperialist neo-liberal agenda of cost cutting and austerity measures as the solution to the present economic crisis of capitalism. Wages are cut, jobs go offshore, privatisation is accelerated, services are gutted and the cost of living constantly goes up. If these measures are so good, capitalism would have solved its problems years ago.

This neo-liberal agenda is dictated by the operations of capitalism to impose the cost of the crisis on the backs of working people, through an upward redistribution of national income. The line is, if you give more to the richest, they will invest more. This will translate into economic growth. We will all benefit. Remember the trickle-down effect? It didn’t come then. It won’t come now. The Australian people will pay a heavy price for the crisis of capitalism.

We already know from past practice that the people will pay and big business will prosper. While big business profits boomed, for most the reality was an average household could only maintain its standard of living with at least two wages coming in. In other words, people had to work more and be exploited harder to keep the system going. Immense wealth is concentrated in fewer hands; working people have less money to spend on living expenses while the cost of living keeps going up. Monopoly capitalism continues to plunge into the crisis of its own making.

The new wave of economic rationalism comes via the USA. The Business Council of Australia has openly called for this shift (See BCA Budget Submission 2011–12). And this organisation is the key representative body of big business in Australia. American interests are dominant within it. Labor is listening to these monopolies and those who work for them. It is not listening to the Australian people. It is committed to the monopoly capitalist neo-liberalism.

US imperialist dictates to our puppet politicians comes as unprecedented attacks are made on the US people, also under the guise of budgetary measures. The world has watched a great struggle against this in Wisconsin, but just last week the Michigan Governor gave himself draconian laws to appoint “emergency financial managers…to run struggling cities and schools, including the ability to terminate union contracts”. If they are in the situation of having to attack their own people, it is no wonder the US imperialists demand that pain be visited on Australians as well!

A key target here is the health system. Expenditure in areas such as health will remain nowhere near what is needed and there will be a push to further privatisation of health services. This means a continuation of rising health related prices. A hike in the price of medicines and the loss of some bulk-billing for pathology and other diagnostic services are on the cards, according to Melbourne’s Herald Sun. Frontline medical research will also be hit.

The government is likely to slash spending across a range of programs, including $1 billion from infrastructure, $88 million from education, and more than $1 billion from environmental and climate programs.

Tax cuts for big business have also been mentioned. The rich pay less, the poor pay more. There may even be a nominal cut to income tax, but this stands to be more than offset by the raising of other charges, and the probable imposition of a levy to pay for the damage caused by the floods. An increase in the Medicare levy is also being considered.

In the immediate period, this points towards a need for the Australian people to defend wages and living conditions, community services and our right to collectively organise and struggle. Action and discussion around the coming budget and its implications for the public and community sectors should be encouraged. Like all people around the world, Australia’s working people will mobilise to expose the real neo-liberal agenda and take action to resist attacks on working people’s wages, conditions, jobs and community services. Immediate and intermediate alternatives that are in the interest of the people will be put forward as the next step to an independent and anti-imperialist Australia.