• Federal treasurer Joe Hockey looks through budget material in Canberra Thursday, May 8, 2014. Mr Hockey will hand down his first budget next Tuesday. (AAP)
In the lead up to his first budget, Treasurer Joe Hockey refuses to be snookered by any uncomfortable truths. The result makes a mockery of facts.
By
Greg Jericho

9 May 2014 - 3:36 PM  UPDATED 9 May 2014 - 3:36 PM

There are a couple options for politicians who have broken an election promise. The first involves facing up to it and trying to hope honesty will win out. Julia Gillard took this approach when announcing the introduction of a carbon price. In an interview with Laurie Oakes soon after she decided not to fudge the issue:

"I didn’t want to get caught up in what I knew would be one of those semantic word games about whether or not I would say the word 'tax'. You know how these games are played, Laurie. A politician decides they are not going to say a word, and then media, people like yourself, Laurie, spend weeks trying to make them say it. I wasn’t going to do any of that."

"So Laurie I just have been really clear with people – a fixed price is effectively like a tax."

Mr Hockey is essentially arguing that when Mr Abbott promised no new taxes he wasn’t really promising that because he was promising to bring in an extra levy on corporations.

Which actually means Mr Hockey is saying Mr Abbott was lying back then... or he's saying Mr Abbott is lying now when Mr Abbott says the debt levy is not a new tax because it is a levy and only temporary. Why? Because Mr Hockey just admitted it is a "new tax".

Right there, Julia Gillard's Prime Ministership took a self-inflicted mortal blow. She had more than enough wriggle room to explain the difference between a fixed price and a tax – heck, she could even use the perfectly correct phrase of "fixed price". Yet she admitted it was a tax, and thus in essence was conceding that yes, she had broken the promise that "there would be no carbon tax under a government I lead".

Such a play is not for someone like Joe Hockey. Prior to the election campaign, and during it, Tony Abbott made many, many promises and claims about taxation under a Tony Abbott government.

He said 4 weeks before election day that, “The only party which is going to increase taxes after the election is the Labor Party.” He also talked often about no new taxes, such as in 2012 when he said "What you'll get under us are tax cuts without new taxes".

So you would think introducing a "debt levy" would pretty much be a hand caught in the cookie jar kind of broken promise (given “introducing” actually means it is new and adding 2% onto a tax rate certainly is an increase). Surely you would think, there’s no wriggle room there.

But you would be wrong.

Joe Hockey told the Fin Review’s Phil Coorey,"We went to the last election promising to introduce a levy for PPL, so claims that we said we would never introduce new taxes are just wrong."

Wait. What?

Mr Hockey is essentially arguing that when Mr Abbott promised no new taxes he wasn’t really promising that because he was promising to bring in an extra levy on corporations. Which actually means Mr Hockey is saying Mr Abbott was lying back then... or he's saying Mr Abbott is lying now when Mr Abbott says the debt levy is not a new tax because it is a levy and only temporary. Why? Because Mr Hockey just admitted it is a "new tax".

It also suggests that Mr Hockey thinks when Mr Abbott was talking about no new taxes on people that promise was void because they were promising a new tax on corporations and thus logically corporations are people too.

I think.

It’s best not to try too hard to follow because it is really "the sky is not blue" level of crazy.

Part of me worries that Mr Hockey realises his logic is utterly bereft and he is just another duplicitous politician. But then another part of me worries more that maybe Mr Hockey believes what he said makes perfect sense. In which case we really should ponder the intellect in charge of the Treasury.

In the end, it is all about never admitting to doing what your opponents accuse you of doing. They’ll accuse you anyway, so why give them any help?

While the ALP will surely keep hitting the government on its broken promises – including the one yesterday that it will unfreeze the indexation on the fuel excise – they are in the odd position of finding themselves opposed to things they most likely wish they could have done while in power.

A tax increase for the very wealthy? The ALP (and the Greens) are really opposed to that? Indexing the fuel excise to inflation, undoing one of the worst decisions of the Howard government which has cost the government about $5bn-$6bn in forgone revenue per year? Is the ALP really opposed to that?

In the end the ALP should support such changes. Fixing the revenue side of the budget is something that will assist the ALP should it ever again come to be in government, so they might as well let the LNP do it for them.

But that doesn’t mean they have to make it easy for the government. Attacking a policy outside of parliament but not opposing inside may not sound very logical, but as Mr Hockey has shown quite clearly, logic is not always essential when you’re playing politics.

Greg Jericho is an economics and politics blogger and writes for The Guardian and The Drum.