It’s now a month since the Henry Review was made public along with the Government’s decision to endorse an RSPT, although there were rumours that this was to be the case for weeks beforehand. Where is the debate now? Who is winning?
It seems that although the Government was out of the blocks first with its messages, the miners have had more impact as far as one can judge from the MSM and the polls. The critical question for the Government is how can it regain momentum and counter the mining industry’s strident opposition to the details of the RSPT?
The last piece Is it that hard to sell the RSPT? suggested that the Government was doing a poor job in selling its RSPT. Today’s Nielsen poll, as dissected by Possum on Pollytics, confirms this, as does a Newspoll in marginal seats. Today’s Essential Report too shows that the miners’ campaign is having more impact than the Government’s.
Now the Government has begun TV promotion, which is bound to have greater impact. It badly needs something better than it’s had. You can see two of the TV promotional pieces on Peter Martin’s blog site under At last - some good communication fromthe government about the RSPT.
The Government produced a specific paper on the RSPT – The Resource Super Profits Tax- a fair return to the nation that arose from the Henry Tax Review. I couldn’t find a publication date. It is a typical Government paper couched in the precise and somewhat archaic language that bureaucrats use. It is informative for those who seek the detail it contains, but not educational for the general public, as almost none would bother to read it through even if they were interested in the RSPT. It is not until page 26 that the threshold at which the super profits kicks in is mentioned - the long-term bond rate. Yet this is a crucial point in the debate. Perhaps the most telling graph, one that makes the case for the tax, does not appear until page 10 and even then it is complicated by captions (LHS and RHS) for which no explanation is given. While one cannot expect such a document to be a ‘sales pitch’, one specifically designedfor this purpose should have been prepared at the same time as selling the tax is as least as important as getting the details into the public domain.
I discovered today that the Government has a website A tax plan for our future Simpler. Fairer. Stronger. It says its commencement date for radio was May 29 and TV June 6. This is the first time I’ve seen this website and I’ve been looking! On a page headed Public Information Campaign there are videos (the same as those on Peter Martin’s blog site), and several audio pieces for use on radio.
In contrast, let’s look at what the Minerals Council of Australia has on its website Keep Mining Strong, which has been around for a while – it doesn’t have a publication date either, so I don’t know when they put it up. It is attractively set out and easy to navigate. While few would bother, it is educational as well as informative, and has had a head start over the Government site. The MCA’s press release sets out what it wants on the table for the RSPT discussions – everything. It denies the oft-heard assertion from Treasury, Government and economists that there is a two-speed economy.
On a website addressing the RSPT directly, The Daily Bludge, J J Fiasson has an informative Mining Tax Facts Site. It is well worth a visit.
That’s what the proponents and opponents say – what do the commentators say? There are many pieces – here is a selection.
Mark Bahnisch on Larvatus Prodeo on June 5 in What if the mining industry backsdown? concludes: “If, say, the government agrees to exempt existing projects and fiddle a bit with the tax’s design, under the guise of the promised “generous transitional arrangements”, where will that leave Tony Abbott and the Coalition?”
In Shallow discourse in The Age on June 5, Shaun Carney opens: “Australia's political debate is more and more about slogans and marketing, and less and less about ideas.” He sums up the RSPT debate with “What we have with the resource rent tax battle is pretty simple: the elected government wants to change the tax system and an important, powerful, cashed-up section of industry wants to frustrate it.” He laments “Australian voters do not seem happy and they do not seem particularly attached to the government. The nation escaped the recession that hit every comparable country and, according to the budget, the insurance bills will be paid within three years, but it's seemingly not enough.” He concludes: “This is why the mining companies' assault on the government's legitimacy - its right to set taxation - is so important. If the companies prevail, it will be a powerful sign that our political systemis fragmenting, getting weaker, and governments in the future will be reform-free zones.” We all ought to be concerned.
Over at Larvatus Prodeo, picking up on Carney’s piece, on June 5 Mark asks Who governs Australia? He begins: “Much more is at stake in the noise around the RSPT than whether the mining industry ends up paying more tax. A whole host of serious public issues entwined with the proposal –including but not limited to the adequacy of our corporate tax architecture, the desirability of a two speed boom bust economy, an increase in workers’ superannuation, the need to invest in infrastructure, and the fly-in, fly-out regional economy – have been thoroughly obscured by the so-called ‘debate’. Each one of these inter-related questions needs serious consideration on its own, but none is receiving anything beyond an occasional distorted mention to serve the partisan needs of the almighty narrative.” He refers also to an article by Tim Dunlop on The Drum on June 3 No-one is blameless in the current malaise, that concludes by sheeting home responsibility to the media: “It lies with the media. To all intents and purposes they are the public sphere and until they do their job better, we won't get anywhere. What's more, they are the only ones with at least a theoretical commitment to disinterested discussion and objective assessment of the facts…
A political media that reported honestly, eschewed excessive opinion and trivia, and openly apologized when they made errors of fact or interpretation, would start to buy back the trust they have lost and public discussion might move beyond he said/she said faux-journalism toward informed debate. They might even save themselves. The media need to stop pretending they are separate from the issues they report on. More than any other institution, they set the terms and the tone for public debate. That's an enormous responsibility.”
Back at LarvatusProdeo in CFMEU on the anti-RSPTcampaign: “It’s going to ruin us!” Mark has an entertaining video that lampoons the ‘disaster’ the RSPT has been painted to be.
Turning to the miners’ campaign, Tony Maher in The Punch writes on June 4 Xstrata is just playing chicken with the Government. He debunks the Xstrata’s claims and concludes “To blame yesterday’s job cuts at Ernest Henry on the RSPT– 24 months out from the reform’s scheduled introduction – is plain cruel to these workers, their families and communities. Passing strange? Actually not that strange. Yesterday’s announcement is entirely consistent with Xstrata’s corporate modus operandi: cynical and money-grubbing. It’s what we expect, but disgraceful none-the-less.
We are told that tonight on Four Corners Clive Palmer admits that he’s not closing a mine in WA as he said a few days ago, but is just ‘slowing it down’ whatever that means! This is the story in ABC North West WA.
Writing on May 31 in The Age in Fear campaign on resources tax is a furphy John Perkins begins: “The miners' raucous opposition willfully ignores the facts.” and concludes: “By imposing a resource rent tax, Australia is right to show leadership as the major resource exporter. If they are governed rationally, other jurisdictions will follow suit. The miners should quell their raucous opposition. Australia should now join together with other resource-exporting countries to ensure that supernormal resource revenues are invested wisely for the future of the planet.”
At An Onymous Leftie on 4 June Jeremy asks Why’s the business lobby letting the mining companies try to kill their tax cut? He begins: “This is what I don’t get about the RSPT and the accompanying 2% cut in the company tax rate proposed by the ALP: why aren’t the lobby groups for other businesses in Australia out there countering the mining companies’ shamelessly dishonest fear campaign?”
In The Age on June 5 in an article: Rudd has more to worry about than miners’ bluster, Peter Hartcher talks about Paul Howes’ entry into the RSPT debate and says: “Why does he think the Rudd government is in electoral danger? ‘I think the government has difficulty selling its achievements.’ For what it’s worth there is an accompanying online poll that indicates that of those polled 77% say the mining industry is winning the ‘public stouch’ over the proposed mining tax. Hartcher, talking about the reforms Andrew Fisher achieved all those years ago concludes:“This sort of real change will take years, and Rudd has only a few months. The Rudd government has not succeeded in explaining its accomplishments, and Rudd has destroyed the political identity which carried him into office. That's why being attacked by overblown miners is his best hope for a new, quick-drying political persona."
In Rudd needs to prove his mettle in tax fight Laurie Oakes in the June 5 issue of the Daily Telegraph agrees: “The mining row is Rudd's chance to show some steel. And he is going flat-out to exploit it.”
In his 29 May piece in the Daily Telegraph: Mining new depths of political bastardry Oakes quotes Rory Robertson, a Macquarie Bank interest rate strategist. “In a recent report, Robertson wrote that miners were not paying their share because ‘flat-footed state governments were slow to adjust their royalties to take account of the surge in global prices’. He spoke of ‘the basic logic’ of the Federal Government's approach, then proceeded to demolish one of the resources sector's key arguments - that the proposed tax is 'retrospective’. After all, every city-based household knows that its rate payments will trend higher over time, even if the home was bought many years earlier. Owners of rural property know that the government rates and rents are linked directly to the latest assessed value of the property, and that if that value doubles, then payments to government will tend to rise. Finally, those of us working over decades to build 'human capital' would struggle to argue with a straight face that any increase in income-tax rates is unfair because it is 'retrospective'." Oakes concluded:“But the mining companies will not be concerned. Their campaign, after all, is primarily about their hip-pocket nerves.”
That’s enough to give you some flavor of the comments. I trust you have found them informative.
Let me end by painting a picture of how I see the fight. Imagine Kevin Rudd, Julia Gillard, Wayne Swan and Lindsay Tanner standing on a street corner on their way to deliver what they regard as a beneficial package to the nation. They are approached by a group of heavy well-heeled men armed with expensive but not lethal weapons who demand they drop the package or at least modify it to suit them. They threaten to undertake a costly campaign to destroy the package. The four resist and press on. The large men become very angry – one of them almost explodes.
On the sidelines there are some academic looking men who declare that the package is well thought out, fair and necessary. The four quote them. On the other side there are some well-dressed men who express doubts about the package in varying terms –some say it is deeply flawed and must be scrapped, that geese laying golden eggs will be destroyed, thousands of jobs will be lost, their endeavors will go overseas, the nation will be threatened by ‘sovereign risk’, and that if it is implemented life as we know it will change irrevocably and nationalization and even ‘communism’ might follow. Others are more conservative, only saying that the implementation of the package has ‘left a lot to be desired’. Most, but not all have mining connections. The large men quote them.
Standing well back but urging them on is an angular man in a wet suit on his way to the surf who assures them he will stop the delivery of the package or will destroy it if they do get it through. The miners see him as a useful accomplice to achieve their aims; they even hint they might throw him some funding if he continues his opposition to the package. The angular man looks pleased and claps his hands. He’s on a winner he thinks. He hopes the confrontation will continue for a long while. He enjoys a scrap.
But has he considered what he will do if the four reach an agreement with the big men and put down their weapons?