LATIKA M BOURKE: Albanese Government’s defence dilemma may present free kick to Coalition

Anthony Albanese and Jim Chalmers don’t want a national security election, that much is clear.

The Prime Minister and Treasurer correctly assess Australians are voting on the cost of their groceries, mortgages and electricity bills.

They will, overwhelmingly so. Which is why Tuesday’s Federal Budget is a politically savvy document crafted to get Labor over the line for the election in May.

It may just work. Labor is pouring money into Costello-esque tax cuts, and funding health services.

But the Budget is predicated on the idea that the global environment doesn’t change between now and election day, which is either May 3, 10 or 17.

And that’s a very big wager given the White House is occupied by a brutal and often capricious Trump Administration that sees little distinction between foes and allies and could lob even more tariffs on Australia at any point in time.

Indeed, it is being urged to do so by an assortment of American industries.

Trump’s attempt to reinstate economic dominance could also trigger a global trade war with China, something the budget documents address, forecasting contractions in Australia’s GDP and increases to inflation in the event of an all-out trade war whereby the USA, China and Australia retaliate by imposing reciprocal 25 per cent tariffs. That would mean higher interest rates and higher Government spending.

The other sense of denialism in the Budget is the failure to do anything meaningful about defence spending.

Treasurer Jim Chalmers spoke of a “dangerous and volatile” global economy as he spoke to reporters at Parliament House in Canberra.

When asked by The Nightly if these words also applied to the geopolitical situation, he agreed.

But his Budget does almost nothing to recognise the serious and “dangerous world” that he acknowledges exists.

Instead it brings forward spending that was due in 2028 to go towards the upgrades to the West Australian naval bases HMAS Stirling and Henderson and frigates.

This sum of $1 billion fails to acknowledge that when it comes to defence spending, the ruthless Trump Administration is sick of its “freeloading” allies.

It is already demanding that Europeans pay at least 3 per cent, if not 5 per cent of their GDP on military capabilities.

The astonishing Signal messaging chat, in which an American editor was cc’ed, between the Trump Administration’s most senior figures — including Vice President JD Vance, Secretary of State Marco Rubio, National Security Adviser Mike Waltz and Secretary of Defence Pete Hegseth — exhibited their frustrations at allied freeloading.

It also exposed the thinking at the core of America First, suggesting that they believe the United States should be remunerated by Europe and Egypt if it was to deploy American military assets, as it has done, to strike Houthi targets in Yemen to stop them menacing commercial shipping in the Red Sea.

It’s not impossible that this logic could be extended to the Indo-Pacific. The Trump Administration has made it clear that Taiwan, for instance, needs to lift its defence spending.

Chalmers is naive to think Australia’s mere 2.3 per cent of GDP on defence spending by next decade will impress the United States, which is asking NATO allies to spend at least 3 per cent and possibly as much as 5.

For now the Government determines that this is a safe bet.

The election could be called in days. Voters have hip pocket concerns top of mind.

And so far it has not paid much of a political price for its ham-fisted response to national security matters such as how it had to be alerted to the Chinese navy live firing in the Tasman Sea by a commercial pilot, before the People’s Liberation Army-Navy’s warships completed a lap of the country.

This is why Peter Dutton, with limited success, has tried to repeatedly inject national security and immigration back into the debate. These are the Opposition Leader’s natural strengths given his past experience as Defence and Home Affairs minister.

But his tactics have involved proposing asinine ideas — such as a referendum about whether to strip dual citizens convicted of child sex abuse and terrorist offences of their citizenship — which have failed to reorient the national debate.

Additionally, Labor has the benefit of being able to badge its natural strength areas such as health, where it is boosting taxpayer-funded bulk billing and cheaper prescriptions as cost of living measures, meeting the mood of anxious voters.

Chalmers is on the strongest ground of his political career presenting his “top-up tax cuts” aimed at “rebuilding incomes” and he knows it. The would-be leader goes into the election battle, armoured and ready.

His budget leaves the Coalition in the unenviable position of having to match or outdo the tax cuts, as it has done already in matching health spending announcements on boosting bulk billing and lowering prescription prices as well as having to find funding for extra defence spending, if it is to engineer national security onto the election agenda.

His frontbenchers have not ruled out copying the UK Labour Government’s approach of cutting foreign aid to pay for extra weapons.

Labor has finely positioned itself to ride the electoral tide into shore with its thin election blueprint in Tuesday Budget.

Between now and the election it desperately needs to avoid being knocked into deep water by a geopolitical Trump-sized freak wave that could throw its defence record into an unflattering and harsh spotlight.