While the treasurer puts the finishing touches to a budget that was to be the lodestar of Labor’s second term, he could be forgiven for thinking he has been washed up on the set of Nevil Shute’s On the Beach.

The Hollywood adaptation of Shute’s 1957 novel about Melburnians waiting for the arrival of nuclear fallout from an ill-judged Middle Eastern war speaks to this moment, as we confront the inevitable consequences of Donald Trump’s foolish bombing of Iran.

While the 2021 global pandemic moved at jet speed, this crisis is its opposite, with the massive oil tankers travelling at the pace of a push-bike. Pre-blockade shipments are only arriving in Asia now, the interruptions to supply have not even begun, but they will be inevitable and devastating.

Even if the government is not forced to ration fuel (and it probably will), the impact of this disaster will be felt beyond the bowser. Higher transport and fertiliser costs will drive up the price of staples. The chain reaction will cascade through the economy with higher interest rates, failing businesses and rising unemployment all placing stress on the government’s ability to fund services that will be needed more than ever.

For Jim Chalmers, it’s not a question of whether there will be a significant global slowdown; it’s how we prepare our response even before the toxic wave hits.

His first budget challenge is to prepare the public for the inevitable, treading the fine line between panic and preparation.

While a majority of the population are now girding their loins for harder times – up 20% from a year ago – that still leaves 45% of people with little idea of what’s about to hit them.

The prime minister’s 1 April address to the nation was designed to begin this process of public engagement, but compared with the dramatic community lockdowns of the pandemic, many critics dubbed his effort pedestrian. That’s because a slow-moving shipwreck carries different imperatives.

In a fast-moving crisis, government is shaken from its natural stasis. At the start of the pandemic, government took drastic steps to lock down communities and spend vast amounts of money to ensure people stayed alive and businesses stayed afloat. So too during the 2007 global financial crisis where the government went to enormous lengths to keep the economy beating.

Chalmers’ budget can’t prevent the impending disaster, but it can prepare with the benefit of foresight. This calm before the shitstorm also creates the window for more fundamental reforms to address what have been hitherto intractable challenges.

The first task is to get the budget in structural shape by defusing a fiscal timebomb the NDIS has become. What was a transformative idea to give people with disability dignity has become an unregulated market ripe for exploitation. Refocusing the scheme around the needs of those with severe physical and intellectual disability becomes a non-negotiable.

The treasurer also faces a second bomb let off nearly three decades ago when the Howard government embedded tax concessions for property investors that turned housing into an asset class, privileging those already in the market over those who seek a place of their own. Capital gains tax and negative gearing concessions are not just a rapidly increasing liability for the budget, but a living expression of both inter- and intragenerational inequity.

The third bomb has had an even longer half-life: the brittle energy supply chains and our reliance on fossil fuels has become a feature, not a bug, of globalisation. As the PM seeks fuel security with trading partners, Australians want to know why we are not receiving a longer-term dividend for our natural resources.

A second question in this week’s Essential Report shows there is majority support for action on all these three fiscal fronts, although the housing concessions are still contested.

The risk for the treasurer is that if this is all he does, we will resemble Shute’s doomed Victorians attempting to assume the vestige of normality even as the radiation engulfs us.

As the economy turns south, the government will be faced with fundamental choices in how it responds. Will it follow the pandemic playbook with budget-busting direct handouts to keep people and businesses afloat? Or will an Overton window open for longer-term investments in community resilience?

It will not be enough to constrain the NDIS. Families outside the scheme need and deserve access to services delivered through the community rather than the marketplace. These shared models of support could become a model for broader social infrastructure at a time when more people risk slipping through the gaps.

On housing, a likely surge in homelessness will demand a rapid rollout of social housing, rather than the business-as-usual developer-driven supply-side agenda currently being pursued at both federal and state levels.

As for energy, surely this crisis will be the moment to double down on the transition to renewables. A final table shows the public’s support for energy transition remains strong. While there will be calls to drill for oil, revive coal and open new gas fields, the only true sovereign energy capacity will come from a grid that taps our natural resources.

At the height of the pandemic restrictions there was idle talk of “building back better”, a determination to increase sovereign supply chains; but once the storm passed the system reverted to stasis.

Building sovereign capacity at all levels – energy, manufacturing, defence, technology and social systems – seems the only rational response to this irrational crisis. The kernel of this idea lies in Labor’s Future Made in Australia agenda, which looks great on a bumper sticker but still needs to be bought to life.

Once this crisis passes, the time might be ripe to take Shute’s warning even more literally, as the rising military-technology complex accelerates its hostile takeover of the state, placing humanity again at existential risk – whether you are concerned about artificial general intelligence or just don’t want madmen with the code to the nuclear suitcase.

When Shute’s book was first released, it a became a global bestseller, bringing to life the consequences of the emerging doctrine of mutually assured destruction. The extent to which politicians meet this new moment of madness will be their real test of leadership.

Peter Lewis is the executive director of Essential, a progressive strategic communications and research company that undertook qualitative research for Labor in the last federal election. He is the host of Burning Platforms, a weekly podcast focusing on the politics of technology

Australian budget 2026

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