Turnbull must cut these payments.
The Senate can reject these cuts, but any holdup means that the money does not flow to the intended recipients. This constitutes real pressure to pass.
This money is spent on public hospital services, government and non-government schools, road and rail infrastructure. These payments are Turnbull's battering ram in the Senate.
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Turnbull has to learn to play hardball. The Senate has to be made aware that Something's Gotta Give. They either cut payments to people or services. A commonwealth government that does not make this deal explicit is failing in its duty to the electorate.
It is the sort of failure that allowed Labor's fraudulent campaign about the privatisation of Medicare. On election day a friend received the text claiming to be from Medicare (the sender said Medicare) and knew it must have been a scam. On talking to some younger people at her daughter's cafe - two had received the same text - she learned that they naively believed the SMS and, like thousands of others, voted Labor as they were afraid of losing their health benefits.
If the first part of the Turnbull strategy is squeezing payments to states, the second is squeezing Turnbull's snobbery. The Coalition has fertile ground among more than 500,000 voters who opted to vote for Pauline Hanson's One Nation, the Australian Liberty Alliance, Rise Up Australia and sundry others.
Turnbull must move away from the concerns of the city elites on culture wars. Turnbull should get stuck into anyone who rabbits on about weaker borders, treaties with Aborigines, Islamophobia, gender identity or withdrawing a gay marriage plebiscite.
Turnbull must abandon the ABC Q&A crowd and speak direct to Hanson's constituency. About the only Coalition seat in Australia at risk from such a strategy is his own, which he can be quite confident he will not lose.
Remind the voters, PM. Something's gotta give …
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