The government had several coherent (even if contestable) reasons for its decision: SPC sits within a highly profitable company flushed with cash to invest unlike our debt-riddled government; that to give money in these circumstances would set an appalling precedent of corporate welfare, inviting profitable businesses to queue for handouts; that this government is philosophically driven by the principle that it is for businesses to stand or fall on their own. Fleetingly, the government mentioned these. Since the storm of protest it has fallen back on them. But for what Tony Abbott has described as a "defining decision" of this government - one that underlined its firm philosophical commitment to non-intervention in the market and the end of corporate welfare - it has now significantly muddied its own waters. There was scant justification for placing industrial relations at the centre of this story. Ask SPC why it's struggling and you get a very clear answer that emphatically has nothing to do with industrial relations. Employees' allowances, they've now informed us, cost them $116,467 last year. Next to the $25 million they're after, that's piddling. In that context there was simply no need for the Prime Minister to give the company, which he had just finished telling us was so well run, public advice on how bad its industrial arrangements are.

SPC knows its industrial arrangements - considerably better than the government, it turns out. No, the government's performance here was for the electorate. In this respect, the SPC decision is really chapter two. Chapter one came last week when Employment Minister Eric Abetz warned that Australia risked "something akin to a wages explosion of the pre-accord era when unsustainable wage growth simply pushed thousands of Australians out of work". As it happens, actual wage growth is the lowest we've ever seen, but Abetz wasn't talking about money. He was taking aim at conditions: too much leave and the like, which makes businesses less profitable. Abetz's evidence was thin, which is probably why economists broadly dismissed his claims. He drew on a few examples from the car manufacturing industry and the resources industry, which represent the extreme ends of our two-speed economy and not an economy-wide trend of over-generosity. But that is the portrait of our economy the government is urging on us: one where it is workers' conditions negotiated collectively with employers that cost jobs, and not the bigger underlying economic conditions like the strength of our currency or our exposure to a global marketplace that often reciprocates with more protectionist measures than we afford ourselves.

The SPC case therefore had to be bent into shape to fit this narrative. That's why the government emphasised things such as the EBA's "wet allowance", which means almost nothing to anyone, and for that precise reason sounds idiosyncratic and decadently, unjustifiably generous. "Wet allowance? I don't have a wet allowance. No one has a wet allowance! Must be a rort!" thought the public. Or at least it did until it became clear that this allowance covers the costs of protective gear for people whose job brings them into contact with dangerous chemicals, and that SPC no longer pays it anyway, preferring instead to buy the gear for the workers itself. Significantly, this narrative isn't simply one of union bashing. Listen to Abbott and Abetz and you'll note the companies are getting bashed as well. They're the ones Abetz described as "weak-kneed", and which Abbott has urged to get their "house in order". What's happening here is a transference of responsibility: a declaration that our industrial relations are in total disrepair, but that it's not for the government to do anything about it. This, I suspect, is the Abbott government's way of establishing an industrial relations conversation, without having a policy debate on the issue. Abbott knows any discussion of policy will be politically catastrophic. He also faces enormous pressure from within his own movement to take back the territory the Coalition surrendered with John Howard's defeat. The solution seems to be to make it an issue independent of government; to illustrate slowly over time that the system is broken so that reform becomes possible.

It's as though Abbott is trying to drag himself kicking and screaming towards a policy. But to do that his illustrations need to have punch. And all that is lost when your illustrations turn out to be caricatures. Waleed Aly is an Age columnist. He hosts RN Drive on ABC Radio National and is a lecturer in politics at Monash University.