It started so well but has ended in a whimper. I’ve just filed a story for Diginomica on how Australian’s Innovation Agenda died, strangled by the nation’s complacency.
While writing it, I found the moment Prime Minister Malcolm Turnbull’s credibility evaporated. At a media stunt in suburban Sydney, Turnbull and his treasurer Scott Morrison visited the Mignacca family who own two speculative properties and had just bought another for their one year old daughter.
That stunt illustrated everything that is wrong about modern Australia’s investment and taxation policies. The Mignacca’s could be improving their skills and education, they could be setting up a business to provide the jobs and growth that was the cornerstone of Turnbull’s re-election campaign or they could be developing innovative new products for their industries.
Instead they are speculating on property – and borrowing heavily to do it.
The Mignacca’s are doing nothing wrong and are responding rationally to the incentives in Australia’s tax system as well as doing exactly what their peer and parents did, speculating on property to secure their retirement.
Not that this strategy is without risk, like 85% of the Australian workforce both of the Mignacca’s jobs are in domestically facing service industries and in the face of an economic downturn the young couple could find their properties falling in price at the very time they can’t afford to keep them.
In ditching the Innovation Statement and adopting the comfortable rhetoric of his predecessors, Turnbull betrayed the Mignaccas, Australia’s economy and his own stated view about the nation’s property addiction.
Moreover, he killed any credibility he had in being able to recast Australia’s economic future.
One suspects history won’t be kind on Malcolm Turnbull and the day he travelled to the Mignacca’s home will go down as the moment he lost the future.