Of course, if we start with the ABS’s central projection the problem looks even less alarming and Hockey’s exaggeration even wilder. Hockey is quoted in The Age (24 April) as saying that “the percentage of people of working age supporting those over 65 will almost halve”. Using ABS projections, the proportion of people “of working age” (defined by the statistician as 15 to 64) was about 67 per cent of the population in 2010 and will be 63 per cent in 2050. (This figure is based on the ABS's middle projections. If we use its high-growth projections, the figure is 61 per cent.) Hockey predicted that only 37 per cent of the population would be of working age in 2050, yet the best available estimates from the ABS show it is in fact is between 61 and 63 per cent. Here, Hockey has exaggerated. His number is over six times the best available estimate. Now let's look at the whole Australian population. Less than 45 per cent have any paid employment at all and less than 30 per cent have full-time work. Bear in mind that, by and large it is the full-timers who pay taxes and work for dividend-paying firms; part-timers can barely support themselves. Essentially, 55 per cent of the population is dependent, one way or another, on the 30 per cent with full-time jobs. If the age-employment ratios stay the same until 2050 there will be a minor problem: 60 per cent of the population will be dependent on about 25 per cent who will then be in full-time work. This suggests that, over 30 years, the burden on those in work supporting those who are too old, too young, too ill or too unattractive to employers to work, will rise by around 11 per cent.

But if productivity keeps rising at its present rate, average wages will rise by 56 per cent over that time. This means workers will still be 45 per cent better off than they are now (even after supporting their families and being taxed to provide support and services to everyone). There is no need for age-employment ratios to stay the same. Forty-five per cent of Australians aged between 45 and 54 are in full-time work. For those aged between 55 and 64, 29 per cent are in full-time work. As everyone who has left or lost a job after the age of 55 knows, getting a new full-time one is practically impossible: even getting an interview is rare. At the moment 400,000 fit and willing Australians over the age of 55 can’t get work. Fix that problem over the next 30 years and practically the whole Hockey crisis goes away. Step one should be to force employers seeking 457 visas to prove that there are no Australians willing and able to do the relevant jobs. There is still a federal deficit to worry about. It is small in global terms and not growing particularly rapidly, but it would be reasonable to stop it growing any faster than the Australian economy as a whole. By far the quickest and most humane way of fixing the deficit is to get the 600,000 unemployed Australians into jobs.

Step one should be to force employers seeking 457 visas to prove that there are no Australians willing and able to do the relevant jobs. Next, if a few of the worst tax loopholes were closed no cuts would be needed at all. The gold-plated parental leave scheme for women has come in for a lot of well-deserved criticism, but what about the rort that lets millionaires save 30 per cent tax by making super contributions while part-timers on less than $18,000 per year pay an extra 15 per cent tax on their contribution? And what is the economic or even the political justification for allowing negative gearing on the purchase of established housing? What is so special about the mining industry that it deserves rebates and deductions worth several billion dollars a year, even while the pathetically ineffective mining resources rent tax is to be abolished? Why should the means test on the pension be tightened while the means test on the health insurance rebate is to be removed? There is no financial crisis in Australia, and no threat of one. What we have heard from Hockey is the opening blast of a new phase of the class war: tax breaks for billionaires and heavy lifting by pensioners. The ALP should be calling Hockey out for what he is doing: party democracy might be good, but proposing policies in the interest of the 99.9 per cent of the population who aren’t billionaires would be better still.

John M Legge is an educator, author and consultant.