By Mungo MacCallum Mon 19 Aug 2013

Photo: It is unlikely that Joe Hockey's costings will be taken all that seriously, but it probably won't matter. (AAP: Alan Porritt)

Based on how we feel about raising taxes or cutting spending, it seems we feel impervious to the real problems that beset the rest of the world, writes Mungo MacCallum.

For a brief, golden moment back then, it had looked as though the election was getting real - that we might just have a debate about something that mattered.

Kevin Rudd launched his campaign with a sober and serious speech about the challenges faced by the nation as we transitioned out of the first, investment phase of the mining boom and towards a more diverse economy. Tony Abbott responded with his usual over-the-top attack on a budget in crisis, spending out of control, a national debt and deficit emergency.

Hyperbole, of course, but at least he was on the subject. Were we finally going to abandon beat ups about boat people and photo-ops in silly hats for a genuine confrontation on economic management? Was it, at last, the economy, stupid?

Well, not for long. By the end of the first week, both sides had reverted to constant pork-barrelling, silly scare campaigns and largely uncosted promises.

Abbott, having failed to follow in Bob Hawke's footsteps as a Rhodes scholar, turned himself into a roads scholar instead, vowing to surround every Australian city with endless rivers of asphalt as a populist substitute for real infrastructure investment. Rudd hurled yet another bottomless bucket of money at the car industry for repatriation to Detroit and then pursued Abbott into the trackless north in search of the economists' equivalent of Lasseter's lost reef.

At least Rudd's commitments had some pretence of affordability - well, according to Treasury's long-awaited and greatly misunderstood PEFO. Abbott's clearly did not.

Joe Hockey remained undeterred:

I just say to you that if the whole election is to be about costings rather than about policies like we are announcing today then I think everyone is going to bore the Australian people to death. We don't want to do that, we want them to be excited about the policy initiatives.

That day's exciting initiative, incidentally, involved removing the right of appeal from asylum seekers, a policy previously found by the High Court to be unconstitutional.

However, something had to be said about costings, so last week Hockey played his trump card: his costings would be done - indeed, were already being done - by three eminent Australians: Peter Shergold, Len Scanlan and Geoff Carmody.

And it sounded great: these were all men of expertise, experience and above all integrity. Shergold had served as head of the Department of Prime Minister and Cabinet, Carmody as a high-ranking Treasury officer, and Scanlan as auditor-general of Queensland. And in their previous jobs they would have been perfectly placed for the task.

But that was the point; all three were now retired. They no longer had the vast resources of their departments to call upon. So now they were in no position to question Hockey's basic assumptions: for instance, would the Coalition's Direct Action Plan actually reduce Greenhouse gas omissions by 5 percent by 2020 for a cost of $3.2 billion? Treasury had already said that it would not - that it would cost at least three times that amount before even considering the ongoing costs.

The eminent trio would have neither the time nor, more importantly, the resources to review the Treasury analysis; all they could do was check Hockey's arithmetic, much as the accountants WHK Horwath had done in 2010, an exercise that ended in tears. Once again, garbage in, garbage out; it was just another stunt.

The fact remained that Treasury estimates were still, as even Abbott admitted, the best available. True, the predictions did not always come to pass; but this was often because they were accorded an infallibility which the oracles of Canberra had never claimed. Forecasts were just that, forecasts, allowing for considerable variation in either direction. And as the invaluable Ross Gittins pointed out at the weekend, after the first two years we were not even talking forecasts but projections: assumptions made on the basis of long-term averages.

For politicians seeking to convey certainty and stability to the electorate it was undoubtedly unsatisfactory, but it was still a lot better that they were likely to get from three hand-picked retired bureaucrats.

So it is unlikely that, when they are released in the last week of the campaign, Hockey's costings will be taken all that seriously; but it probably won't matter. There are times when it appears that the fat years have made the voters believe that Australia is, once gain, the lucky country, impervious to the real problems that beset the rest of the world.

A week ago Essential conducted a poll asking voters what, if anything, needed to be done to reduce the debt - did the government need to raise taxes or cut spending? Eighteen per cent third said neither - we'd be right. And of those who accepted that something needed to be done about the constantly depleting coffers, only 6 per cent would countenance the idea of tax increases. Forty-five per cent said that answer was to reduce spending.

Foreign aid was the favourite target, followed closely by the arts. Private schools could take a cut - but not public schools. And perhaps there were areas of welfare, although it was hard to pin down which - just about everyone seemed to be getting a handout of some kind. But hands off health, and above all roads. Perhaps Abbott had his priorities right: number one is somewhere to drive our gas guzzlers.

As the former Treasury head Ken Henry has pointed out, the situation is becoming unsustainable. Simply to hold the line there will have to be tax increases as well as spending cuts, and both the politicians and the public will have to get used to the idea.

But it being an election year, the politicians are continuing to offer the punters everything they want for nothing, and the punters have grown to expect that as their due. Perhaps if it is the economy, stupid, then we are the stupid ones.

Mungo Wentworth MacCallum will be writing weekly for The Drum throughout the campaign. He is a political journalist and commentator. View his full profile here.

If it's the economy, we're the stupid ones - The Drum (Australian Broadcasting Corporation)