Executing a 180-degree turn is a tricky manoeuvre for a naval fleet as big as the one sailing into Sydney Harbour this weekend. While there's less danger to life, limb and rigging, it's also difficult for a coalition that's spent the past four years fighting a phoney war about government debt.
But there are more signs that Joe Hockey is signalling that just such a turn is in the offing. The big bloke is about to attempt a backflip with half twist – everybody stand back.
Changing course: Joe Hockey.Credit: Glenn Hunt
The latest instalment comes from the AFR's Laura Tingle who reports that Hockey "is considering identifying government borrowings raised to fund infrastructure as separate from debt raised to cover the budget deficit as the Abbott government contemplates an infrastructure spending splurge". Suddenly I'm running into senior Liberal types wanting to explain what a good idea infrastructure bonds would be, and not just John Hewson expanding on his July National Press Club speech.
The semantics are wonderful: the Labor Party generated evil government debt that will enslave your children; the Liberal Party will access capital markets to set your children free.
And that is a good thing, however galling the about-face might be for those who suffered the fiscal ranting of Hockey as shadow treasurer.
The immediate problem though is the speed of the change of rhetoric. It takes time to prepare the ground, to work out a structure and then to develop a narrative and sell it to an electorate that has just bought the idea that all government debt is bad – but in the meantime the window of greatest need for infrastructure stimulus is already upon us.
I've lost count of the number of times the Sydney WestConnex motorway seems to have been announced, most recently last month by NSW Premier Barry O'Farrell and the new prime minister, but ripping up the first pavement is still 18 months away. Even something that has been worked on as much as WestConnex still takes a lot of preparation.
That's the problem with looking to major infrastructure projects as a means of economic stimulus – it takes years to make them shovel-ready, let alone to get the shovels shovelling. There's plenty of work and employment that goes into the necessary planning stages, but the big money doesn't really flow until there are big machines burning it.
The various roads projects being promoted by the coalition as symbols of their infrastructure commitment are convenient because the projects already exist. They've been in development for years; there's nothing new happening. (And there's another whole question about concentrating only on roads anyway, given the reality of better roads quickly attracting more cars that make them not much better at all. Something about mid-20th century solutions to 21st century transport problems.)
Which is why Treasurer Hockey has to get on with it, why he has to come back from his trip to New York and Washington next week fired up evangelical zeal to explain the difference between what he will paint as Labor's "bad" debt and his "good" debt, totally ignoring the value of keeping unemployment below 6 per cent instead of reaching double digits during the GFC.
There is no end of support available for sensible borrowing for major infrastructure investments with sound business cases. From RBA board members to the Business Council, from the superannuation industry eager to invest in the de-risked end result to investment bankers and lawyers desperate for a piece of the action, there's a big cheer squad already working on it. Professors Freebairn and Corden last month provided the economic theology with which to bless it in their paper "Vision Versus Prudence: Government Debt Financing of Investment". All that's missing is the hiring of Jennifer Hawkins to be the official ambassador for Infrastructure Australia.
Oh, there also is a little matter of keeping politicians at a great distance from the infrastructure fund Hockey wants to establish. They are not to be trusted with a pile of money and sundry mates and electorates wanting a favour.
And the privatisation thing also has to be sorted. The NSW government is justifiably proud of its funding model for WestConnex, as spelt out at some repetitious length by treasurer Mike Baird as part of the latest re-announcing, but privatisation-wary states and electors have to be brought along for the ride. That takes time too. Hurry up, Joe.
Michael Pascoe is a BusinessDay contributing editor.