Politics

What Good Are Billions Of Surplus Dollars When People Are Starving?

While both major parties are measuring their surpluses, Newstart hasn't been raised in 25 years.

Newstart election frydenberg bowen

With the election less than a week away, both our Coalition government and Labor Opposition have confirmed one thing: no matter who Australia elects on Saturday, our poorest citizens will continue to needlessly suffer.

Rather than committing to raising Newstart — and using government resources to lift citizens out of poverty — both sides of politics remain united in a singular and ludicrous neoliberal obsession: the pursuit of a budget surplus.

On Friday, Labor promised the largest surplus in Australian budget history — loudly boasting that it will be twice as big as the Coalition’s projections. Predictably, this has now triggered days of juvenile “my surplus is better than yours” chest-beating from two prospective leaders who are gleefully abandoning the poor in order to “bolster” their respective budgets.

Even though low-income citizens and advocates have been demanding a raise to social security entitlements, Morrison and Shorten continue to distract the public and the press with another fiscally conservative dick-measuring contest.

Sadly, in Australian politics, this has been the norm for the last three decades: seeing leaders from both sides needlessly battle it out over who can spend the least, cut the most and predict the bigger surplus.

What’s The Point Of A Surplus?

As many leading economists have pointed out, our modern obsession with surpluses and deficit reduction are largely nonsensical. Warwick Smith, research economist at Per Capita, convincingly argues that budget surpluses just lead to more private sector debt and could actually trigger a recession. Remarkably enough, in Australia’s recorded history, 85% of the time our Federal Government has actually run fiscal deficits.

For low-income voters battling to survive, our modern surplus fetishism is not only nonsensical, but deeply insulting. Here, government’s “We’re going to achieve a huge surplus!” rhetoric effectively translates to “Look at this giant pile of money we’ve inexplicably chosen to withhold from you!”

After all, what bloody good is a budget surplus if it condemns more than 3 million Australians to life in poverty? Shouldn’t it be the primary task of a responsible government to use it’s available spending power to look after its own people?

While our two leaders bicker over who’s the better neoliberal managerialist, devastating stories continue to emerge about unemployed Australians being driven into homelessness and suicide by heartless government austerity.

Newstart recipients — who can live as low as $243 a week below the poverty line — are now the second poorest unemployed population in the OECD. A new report from Anglicare has revealed that Newstart recipients can’t afford a single rental property in our major cities — not one. And, in a recent survey, the Australian Unemployed Workers’ Union found that 52% of Newstart recipients reported skipping meals more than three times a week.

Rather than attempt to tackle this miserable state of affairs, the Liberals continue along with their “see no poverty, hear no poverty” approach to economic management. The ALP at least acknowledges poverty is a significant problem, but, sadly, have chosen to do practically nothing about it.

An Austerity Election For Those Who Can Least Afford It

For months now, Labor has conceded that Newstart is “too low;” however, the party refuses to commit to anything beyond a lengthy “review” of the entitlement. Even though the vast majority of Labor voters support it, no future Newstart raise was factored into Friday’s election costings. It appears that, for the fiscally conservative Labor party, radically improving the lives of the poor would upset the budget balance too much.

Raising Newstart by $75 a week would only ‘burden’ the budget about $3 billion a year. At the same time, Labor is comfortable setting aside $200 billion for extra tax cuts “when necessary.”

Sadly, our “party for the workers,” is still rooted to the ideology of neoliberal austerity, which demands government keep certain citizens poor “for the good of the economy.” In order to post their shiny surplus, Labor (like their Liberal counterparts) believe they must subsequently keep unemployed workers and their families mired in poverty.

In the final run-up to this election, we should remember that these record-breaking, headline-grabbing surplus billions can only exist by denying social security recipients the entitlements they need in order to live a healthy, dignified life.

That’s why, for Newstart recipients and poor Australians, a “surplus” is nothing to celebrate. We know that the foolish pursuit of surplus has kept the rate of Newstart fixed for the last 25 years. We know that pursuit of surplus has now locked 1.8 million of us out of secure work and a decent living. We know that all surplus is really our deficit.


Jeremy Poxon is a campaigner with the Australian Unemployed Workers’ Union.