Why should we listen to the musings of a 76-year-old former union leader?
Because Bill Kelty was one of the economic architects of Australia’s decades of prosperity, thanks to the key role he played in the 1980s building bridges between politicians, business and the trade union movement.
As secretary of the ACTU, the peak body of the trade union movement, Kelty pushed through an agenda during the Hawke and Keating governments that implemented economic reforms that have made the country the prosperous society it is today.
We are among the most prosperous countries in the world.
According to Kelty, the only threat is the continued reluctance of contemporary politicians.
Since then, Australia has benefited from those reforms, and also from a number of reforms introduced by the Howard government.
Led by politicians who were too timid to match the success of their predecessors.
Despite being a Labour man through and through, Kelty recently minced no words when asked to assess the performance of Albania’s Labour government.
He called them “caught in mediocrity.”
The wise man of the labour movement, Bill Kelty (above with Bill Shorten) threw a three-word grenade at Anthony Albanese’s government
“People are not impressed by politicians who tell them — or at least imply — that a tax cut has solved their bill-paying problems, especially a tax cut that means they now pay more in taxes than they did two years ago,” he said.
The former union official is referring to inflation-driven hikes in the GST, along with bracket creep – where workers earn more and move into higher tax brackets – that played a major role in the country briefly returning to a budget surplus. That is, with wall-to-wall deficits forecast for years to come.
Kelty says the government is not doing enough to help younger Australians and that help will require a new round of major economic reforms, which the political class appears unwilling to embrace.
Rather than address the ideas of one of Labor’s most successful policymakers, the Prime Minister brushed aside criticism when asked about Kelty’s comments at a morning meeting today:
“I don’t accept that premise,” Albo said, before launching into a verbiage of supposed achievements in government that he said should help voters re-elect his Labor government for a second term.
An opinion poll yesterday showed Labor trailing the Coalition by 48-52 percent on the two-party vote, with the Labor primary vote having fallen to just 30 percent. It suggested a hung parliament was now the most likely election outcome.
An opinion poll on Monday had a gloomy message from voters to the prime minister
The achievements the Prime Minister himself claims to have made, such as “making a difference in the transition to net zero emissions” and repairing “our international relationships”, fall into the category that Kelty identified as falling far short of the comprehensive reforms the country really needs.
Kelty says the government needs to “implement much more important reforms.”
“What we don’t need is a self-righteous government telling people they really care and look after them,” Kelty added, in a damning assessment that Labor Party strategists should take note of.
The problem with the modern Labor Party is not limited to the PM’s timidity. The former union official was also critical of Treasurer Jim Chalmers’ claims for major overhauls of the Reserve Bank’s operations and reforms to superannuation.
“We don’t need the government to tell us that real reform is about changing the structures of the Reserve Bank,” Kelty said, adding that Labor’s proposed changes to the pension scheme, which would tax unrealised gains, were “political poison”.
The Labor Party has been reluctant to reform since former leader Bill Shorten lost the 2019 “unlosable election” after advocating a raft of major reforms on issues including dividends and investment properties.
The problem with the Labour Party’s agenda was that, while it was bold, it did not do what the Labour Party did in the 1980s and 1990s: implement reforms that included a mix of changes rather than simply punishing the rich with higher taxes in the name of more government spending.
During the turbulent 1980s and 1990s, the Labour Party also advocated reform in government rather than being in opposition before coming to power under Bob Hawke in 1983.
The Hawke and Keating governments became the longest-serving Labor governments since the founding of Australia’s oldest political party more than 100 years ago.
It is perhaps telling that when Albo worked as a Labor Party staffer for a leading left party leader during the Hawke and Keating era, he was a staunch ideological opponent of many of the microeconomic changes that Hawke and Keating introduced. Internally, he disputed their merits.