By Tim Montgomerie
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Tony Abbott, leader of Australia's Liberals, has been in London this week and has met a range of UK politicians including Iain Duncan Smith, Michael Gove, William Hague and, more surprisingly, Chris Huhne. I write more surprising because Abbott is no Liberal in the Liberal Democrat sense. The socially and economically conservative Abbott is riding high in Australian opinion polls by strongly opposing the Labor government's carbon tax. Abbott has also promised to cut taxes, take a tough line on immigration by "stopping the boats", and introduce more competition into the Australian economy. His full programme for government can be read here.
Abbott isn't just a more conventional conservative than David Cameron in policy terms. They are oceans apart in style, too. Cameron's approach is more consensual while Tony Abbott stakes out ground and fights for it. Cameron spent much time in opposition wooing the metropolitan vote and placed very regular OpEds in The Guardian and Observer. Abbott's focus is the "respectable" blue collar vote and he spends a lot of time on his country's talk radio stations. There's an urbane sophistication to David Cameron whereas Abbott is the blunt speaking sports fanatic.
After taking control of the party from Malcolm Turnbull – a politician very much in Cameron's image – Abbott has transformed his party's standing. Labor is only one by-election away from losing office and Abbott is on constant election alert. If he becomes Australia's next PM many UK conservatives will have renewed questions about the wisdom of Cameron's liberal conservatism.
Mr Abbott gave an economy-focused speech to Policy Exchange yesterday. He emphasised traditional conservative positions on tax, borrowing and deregulation. He also expressed scepticism about the Euro and QE. I publish some highlights below:
Fiscal responsibility: "As much as any other government, [the Australian Labor government] has made the fundamental mistake of thinking that a crisis caused, in part, by too much spending and too much borrowing could be addressed by yet more spending and yet more borrowing… The importance of living within your means is always worth restating because this is a lesson that always needs to be relearned. The temptation for governments, no less than for individuals, is to spend today what you might earn tomorrow and to hope that the day of reckoning never comes. It always does, though. Everything that government spends today that it doesn’t have now or that it isn’t investing in real wealth-creation is stealing from the future."
The dangers of Quantitative Easing: "In extremis, when consumers won’t spend and businesses won’t invest, governments can institute “quantitative easing” to fund further expenditure. But if taken too far or continued too long this can easily damage confidence, not restore it. If ongoing government spending is funded by “creating money” rather than by drawing on a country’s actual resources, the currency will be debauched, the people impoverished, and, in the worst cases, such as Weimar Germany, a country’s very survival put in jeopardy. Support for on-going “pump priming” or “demand management” with assets that governments don’t actually have is debauched Keynesian-ism, because that great economist well understood that governments could only sustain present spending in excess of current revenue out of past or future saving."
Scepticism about durability of €uro: "Australia has a part to play as a good international citizen but that shouldn’t mean rubber-stamping the plans of officials whose goal is to save the Euro whatever the cost. Britain’s ignominious exit from the European Exchange Rate Mechanism 20 years back shows that even powerful and determined governments can’t always buck the market for long. The deployment of 25 billion pounds in currency reserves (with a three billion pound ultimate loss to taxpayers) could not sustain an earlier version of European currency integration."
Supply-side conservatism: "In addition to balancing the Commonwealth’s books, building a more productive economy has to be the government’s priority. The Liberal and National parties have a six point plan to boost economic growth: welfare reform to lift participation in work; public sector reform to deliver better, more cost-effective services; red tape reform to cut business regulatory costs by at least $1 billion a year; competition reform to ensure that large and small businesses are competing on a genuinely level playing field; infrastructure reform to ensure best value from Commonwealth spending; and, finally, labour market reform to encourage higher pay for better work."
Abbott is a biking fanatic.
"Our plan is to build a stronger economy for a stronger Australia. This requires government to live within its means – as families do. Lower spending means lower taxes. Less borrowing means lower interest rates. Lower taxes and lower interest rates mean less pressure on families’ cost of living. We will end Labor’s toxic taxes. We will end Labor’s waste and start to repay Labor’s debt. We will stop the boats and strengthen our borders. Above all, we will restore hope, reward and opportunity by getting our country back on track."