David Bushby (Tasmania, Liberal Party) Share this | Hansard source

and the people they employ—the workers of Australia. And it is also unnecessary. There was a better way, and it is not too late to change. It is not too late for the government to change tack, stop spending and let monetary policy do the heavy lifting.

The other great shame about all of this is that at least some of the pain was unnecessary for another clear and obvious reason, the blame for which again falls squarely on the shoulders of this reckless, selfish and big-spending Labor government. During the election campaign, the then Treasurer—and, might I say, the best Treasurer we have ever had, the Hon. Peter Costello—warned that the problems then becoming evident were going to hit Australia like an economic tsunami. Remember, this was in late 2007, just before the election. At the time, the then Labor opposition castigated Mr Costello for scaremongering, but he held his ground, as he could see clearly that at that point trouble was brewing and it was coming Australia’s way.

Of course, Labor won the election and inherited what was then undoubtedly the best-managed, best-regulated and healthiest economy in the world. Knowing full well that the management of the economy was likely to be their Achilles heel, the government sought to develop an argument that they had inherited something other than such a strong and robust economy. The only thing that they could find that indicated any issues within the economy related to a problem that can only arise when an economy is firing on all cylinders: skills and capacity shortages caused by an economy growing at a pace that was outgrowing its ability to supply labour and imports, which of course leads to inflationary pressures.

I might note at this point, and Senator Cameron will no doubt be interested in this, that these inflationary pressures had to a significant degree been relieved by the increased flexibility built into the industrial relations laws—flexibility that enabled both individual employees and their employers to negotiate arrangements that best delivered high productivity and generally relieved capacity shortages. But, having identified inflationary pressures, what did they do? They went out and spent the next 10 months deliberately talking up inflation, talking about how the ‘inflation genie’ was ‘out of the bottle’ and about the need to cut spending, to reduce demand and to slow the economy—even pretending to slash the budget last year to slow the economy and making a big song and dance about it.

I recall, after that, when we had issues with some of the measures that the government were trying to introduce as part of their slashing of spending, Senator Evans sitting across the table and labelling us economic vandals because we were opposing measures that were going to reduce inflation and slow the economy. It was amazing how smoothly and seamlessly he shifted gear after October last year, calling us economic vandals because we were opposing measures that were going to speed up the economy. It is ironic. They changed so quickly, but the label was still the same. So I would just like to emphasise that we are suffering as a result of Labor’s reckless spending. (Time expired)