The 2022 federal budget is significantly more electoral than it is economic

But wait, which emergency are we talking about? COVID? Floods? Russia? All of the above?

Well, the first thing to say is that this one is significantly more electoral than it is economic. The distinction matters.

Ideally, the exigencies of politics and economics match-up sufficiently that doing the right thing for the country is the wisest course electorally. As John Howard used to say, good policy is good politics.

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So presumably, bad policy is bad politics?

Not in Howard's mind when he froze petrol excise in 2001 to smooth furrowed brows over his (never-ever) GST. And not in Scott Morrison's or Josh Frydenberg's minds as they halved said excise to smooth out their glide path to an election that can no longer be put off.

And as they pumped in one-off payments to ease the inflation pain in the suburbs and regions.

But herein lay a problem of incoherence in this most election-conscious of fiscal blueprints.

This budget wants it both ways. Politically it seeks to leverage the atmosphere of emergency in recent years to justify billions in new cash payments to households, while also taking the credit for having steered the economy back to rude good health.

Which is it? In narrative terms, this is a problem.

Economists have warned that injecting extra money into an already rebounding economy will stoke inflation and send interest rates higher.

Morrison and Frydenberg are aware of this conundrum but have concluded that the prospects for short-term political salvation will take precedence over any longer-term economic downsides. Besides, after an election is a far better time for fiscal repair than just before.

But this is still a political gamble because the Reserve Bank could now decide to lift rates in its May meeting, taking money out of household pockets, thereby dampening consumer demand and weakening growth.

In 2007, the central bank lifted rates actually during the election campaign and guess who didn't win?

Even signalling in its May meeting that rates are about to rise would change the mood.

The Treasurer justifiably boasts that the Australian economy has come through the pandemic down-turn in uncommonly good shape, with the jobless rate slated to drop to 3.75 per cent this year and likely to keep dropping - maybe to 3.5 per cent, and who knows, maybe lower?

Self-evidently, this 50-year labour market tightness is a big fiscal boon. It shifts people off the cost column as receivers of welfare payments, and puts them onto the revenue column as payers of income tax. Win, win.

This happy double-benefit is due in no small part to this government's road-to-Damascus conversion in 2020 when it agreed with Labor's call to directly subsidise wages (after first dismissing the idea) as the world reeled from the pandemic shock and feared things would get much worse.

JobKeeper, according to the budget, saved 700,000 jobs.

But this hyper-Keynesianism wasn't cheap. In fact the budget papers put "direct income support" at a staggering $314 billion.

Still, Australia's performance is impressive. The Treasurer called it "the largest and fastest improvement to the budget bottom line in over 70 years" adding that "by the end of the forward estimates, the budget is $100 billion better off compared to last year".

A hundred billion better off yet the deficit will come down by a paltry $2 billion in 2022-23 to $78 billion and will still be $56.5 billion in 2023-24.

In that same year, net debt will reach $772.1 billion on its way to a medium term high of $864.7 billion just as gross debt sails past the trillion dollar mark to $1169 billion. That's a gross debt-to-GDP in 2025-26 of 44.7 per cent. Debt and deficit disaster? Anyone?

That more isn't being done immediately to address this is a function of anxious politics, not prudent economics. The Morrison Coalition government is on the edge of extinction, trailing in the polls, weighed down by a leader who has lost the faith of voters and has dithered in the face of aged care, housing affordability, and of course, climate change.

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Frydenberg exudes competence and is the government's best asset.

The real test of his fourth budget however is not in its accounting outcomes, which in any event will be way off down the track, but in the extent to which voters buy its generosity so close to an election. Which raises the question: Will Labor match it or undercut it?

A broader point to finish: There is something unhealthy about the accepted practice of a government using the taxpayers' own balance sheet to warm voters' hearts on the eve of calling an election.

Surely there are enough imponderables in a budget already without adding in that eight weeks from now, a new government would have dramatically different priorities.