Coalition risks awful miscalculation on economy – and attacking Labor is no solution

Labor is fond of declaring right at the moment that the Morrison government has no plan to kickstart the ailing economy. This isn’t quite right. The government does have a plan.

The plan is this: 1. Hope the post-election tax cuts, coupled with record low interest rates, boost private spending. 2. Have infrastructure spending provide another fillip to economic activity. 3. Hope the benefits of all this show up in the next set of national accounts and, if they don’t, there’s always the midyear economic update to prime the pump, modestly and calmly and decorously of course, lest anyone be accused of latent communism.

The problem with the government’s plan (apart from the obvious risk that its actions to date are massively underdone) is the bubbling uncertainty as it waits to see, dataset by dataset, if its approach proves to be the correct one.

Related: Labor urges fiscal stimulus as IMF downgrades Australia's economic growth

Uncertainty abounds in politics, but it is never comfortable.

While that uncertainty persists – the lingering concern that these guys may not, in fact, be the smartest boys in the room just because Scott Morrison won an upset election in May – so does the external chatter from respectable voices about the desirability of more fiscal stimulus.

Overnight, the International Monetary Fund downgraded Australia’s economic growth forecasts (again) by 0.4% to 1.7% in 2019 and noted monetary policy could not be “the only game in town”. Cuts to interest rates, it said, “should be coupled with fiscal support where fiscal space is available”. This analysis echoes observations Australia’s central bank has been making for some time.

Minutes from the latest meeting of the Reserve Bank also noted delicately “there had not yet been evidence of a pick-up in household spending following the recent reductions in the cash rate and receipt of the tax offset payments” – although the observation is softened by an observation that it might be too early to detect signs of pickup.

Josh Frydenberg has been rolling out his plan, and courting additional stimulus, without calling it stimulus, which is slightly Pythonesque. But while asking the states to bring forward smaller-scale infrastructure spending to boost the economy, envisaging perhaps a commuter carpark-led recovery, the treasurer also points to capacity constraints as a reason why Project Stimulus But Don’t Say Stimulus can’t transform things with electrifying speed.

While performing this mildly strange soft shoe shuffle of desiring stimulus but also disdaining it, the treasurer also wants to lay the ground for trouble ahead. Frydenberg told reporters on Wednesday the IMF had pointed to global economic headwinds, and Australia was not immune from the challenges posed by a synchronised global slowdown.

The sense of things being just a bit fast and loose was compounded on Wednesday in question time, when Frydenberg noted rashly that drought funding was the “No 1” call on the budget (spoiler alert: it isn’t), and Morrison declaring at another point that the budget was in surplus (spoiler alert: it isn’t).

The prime minister told the chamber the government’s strategy was to remain calm, stable and secure, and talk about Labor. Well, the first part of that approach was stated, the second part was implicit, because the majority of question time on Wednesday was trained on Labor’s ill considered and reckless economic stimulus unleashed on the unwitting populace during the global financial crisis, which was capital T terrible.

Related: Australia's banks escape the heat as economic growth slows, Deloitte says

The prime minister somehow omitted the central fact that reckless and ill-considered spending helped keep Australia out of recession, which I suspect at least some Australians are grateful for, given what happened everywhere else, and what has happened to politics in the great democracies of the world as a direct consequence of that downturn, with the landscape littered with demagogues and extremists and populist charlatans gadding about in the cloak of prime ministers and presidents.

Defamation also seemed a somewhat risky course given the government may have to turn on the fiscal tap itself in the event things get worse, although Morrison and Frydenberg will of course present their own pump priming, should that prove necessary, as tight and targeted and enlightened rather than profligate.

So let’s cut to the chase on the government’s plan.

This will all be fine if it’s fine. But if the government has miscalculated, if the economy is teetering here rather than spinning its wheels before moving forward purposefully again, it will not be fine.

It will be bad.

Bad for Australians who suffer in an economic downturn, bad for a government that likes to tell itself and the public that it is the superior economic manager.