Australia's left wing: the new fiscal conservatives

Julia Gillard disclaimed social democracy earlier this year because in modern Australia any admission of being Left-wing is like confessing you're a tree-hugging, drug-loving, bleeding heart (small-"L") liberal with a contemptuous disregard for all things economic. Underneath any headline proclaiming big government, a nanny state, or waste, there's a rabid Rightie blaming a Leftie.

But as a second global recession looms and Australia's non-mining industries continue their freefall, it's the Left-wing that's seeking massive cuts in government size and spending. Areas ripe for a trim by the fiscal razor include water and carbon trading, parliamentary entitlements, private school funding, offshore asylum processing, income quarantining and money wasted in the interminable war in Afghanistan.

Australia's part in the war on terror has cost just over $16.7 billion since 2001. And next year we'll spend a further $1.3 billion to keep our directionless war going. The Greens alone want to bring the troops home and in future require a parliamentary mandate for the declaration of war in non-emergency situations. The Greens approach would cost us nothing.

This year, $1.1 billion was spent for all climate policy initiatives but more than 10 times as much was spent in fossil fuel subsidies and incentives. Major parties continue to pervert the free market so extensively to keep fossil fuels cheap that Gillard's unambitious climate plan is unlikely to make a dent on the entrenched carbon bias. Lefties haven't just protested subsidising the very industry government claims to be shrinking, they've also criticised the administration costs of a market-based system that will commoditise and speculate on something as untraceable as carbon.

These issues, by the way, aren't the sole property of the Left, even though they're painted as radical ideas from the fringe. They are in fact rational rather than ideologically Left ideas, and widely held: a recent Galaxy Poll, for example, found 84% of Australians saying government subsidies to fossil fuel companies would be better spent on developing clean technologies.

It's now passé to point out the convergence of Labor and Liberal hostile policies towards asylum seekers. As The Chaser once explained to Americans, 'we also have two true blue parties: the Liberal party is like your Republican Party, whereas the Labor party is like your Republican Party.' Bizarrely, hostility towards boat arrivals has caused consecutive governments to throw money at the issue. In total, writes Bernard Keane, 'Australia's fixation with asylum seekers arriving by boat has cost taxpayers nearly $2.4b since 2000' or $113,000 per asylum seeker detained. Community processing, the alternative promoted by the Left, is a vastly more cost-effective use of taxpayer money: the Department of Immigration estimates its cost at about $10,000 per person. As Keane concludes, 'our obsession with detention comes with a big price tag.'

Finally, in keeping with a trend in the West to hound the poor in times of economic crisis and uncertainty, our Government is ramping up its Thatcherite rhetoric about welfare recipients, painting them as irresponsible parents, alcoholics and gamblers. From June 2012, the Gillard government will roll-out to five trail areas around the country – Bankstown, Shepparton, Rockhampton, Playford and Logan –compulsory income management like that in place in Aboriginal communities in the Northern Territory. This involves quarantining 50-70% of a person's welfare to pay for essentials and placing their income on a debit "Basics Card" that can be used only at government-approved retailers. The system doesn't spare people who manage their welfare responsibly.

Apart from disempowering and stigmatising those subjected to it, administering income management in the NT has proven very expensive, doing little more than diverging and wasting public monies. It has been ineffectual in changing diets and malnutrition rates, and the scheme has angered businesses because the effort required to get on the list of government-approved retailers discriminates against smaller businesses. It will also involve massive administration costs and the diversion of funds from where they are needed in education and unemployment services; the scheme costs at least $4,100 person per annum or one-third of the total allowance paid to an unemployed person each year, and more than eight times the amount provided to employment service providers to address barriers to work for long-term unemployed people.

Labor and Liberals seem to be oblivious to the gross misallocation of public monies in welfare management, market-skewing subsidies, the war effort and refugee processing. Just as Tony Abbott has been forced to stand as a defender of human rights in the face of Gillard's Malaysia deal, so the Left in Australia now finds itself as the principal proponent of economic rationality and waste minimisation, calling for cuts in government intervention and expenditure in many areas.

The modern trend is to punish the poor during hard times, and as we've seen in NSW in O'Farrell's controversial cull of the unions, and in the US cuts in social spending any excuse will work as justification for cuts. Amidst the growing fear about a second global recession, Liberals have already begun questioning the projected return to surplus. What hasn't been considered in Australia is that in the coming year we're planning to spend $1.3 billion on war, $12 billion on mining subsidies and $130,000 to detain every boat arrival. Will the Gillard government continue to attack the poor with welfare intervention, or will these expensive exercises – war, refugee detention and coal subsidies – be placed on the chopping board?

Mencken wrote that 'The most dangerous man to any government is the man who is able to think things out for himself without regard to the prevailing superstitions and taboos. Almost inevitably he comes to the conclusion that the government he lives under is dishonest, insane and intolerable.' As the Galaxy poll showed, it isn't just Australia's Lefties who now occupy this desolate mental terrain, watching tens of billions of taxpayer dollars disappear year after year in inhumane, witless and economically futile sideshows.