Chris Smith:
Let’s go straight to the senior fellow and chief economist with the Institute of Public Affairs, Adam Creighton, on a very busy news day. Adam, good morning.
Adam Creighton:
Good morning, Chris. Great to be here.
Chris Smith:
Let me start our conversation with a little bit of audio from David Littleproud this morning in Brisbane.
David Littleproud:
No, it’s done. I spoke to Sussan Ley about half an hour ago and made her fully aware. I gave her an opportunity yesterday after we had a party room meeting when she ignored the letter that I sent with those three resignations, that this would be the consequence that we are going down, that we would all resign, and that you would then see an untenable position. Had that conversation, she came back with a set of words last night that I put to the party room. They still would not move on reinstating those three senators immediately, and so I rang her about half an hour ago and told her that the party room’s decision was final, that unless those three were reinstated immediately, then she had forced the Coalition into an untenable position.
Chris Smith:
So Adam Creighton, he has also forced her into an untenable position-
Adam Creighton:
Certainly.
Chris Smith:
… and awkward position. She can’t win either way. If she goes back, reclaims the Coalition, puts those three sacked shadow cabinet ministers back in her shadow cabinet, she’s going to be seen as weak, not worthy of it.
Adam Creighton:
Yes.
Chris Smith:
The Liberal Party will probably take her out. If she does the other and the Coalition breaks out, someone else will take her out. Is this the beginning of the end of Sussan Ley and the Coalition?
Adam Creighton:
Yes. Look, I think it’s certainly the beginning of the end of Sussan Ley, and I think this is just hastening what was going to happen anyway, to be honest, probably in six months’ time. But it could be one month’s time now instead. This has obviously been a disastrous few days for the Coalition. Also for the country, I might add, because we passed that horrific hate speech law, but that’s been the trigger for all of this. The fundamental problem is the right is fragmenting in Australia. They don’t really know what they stand for. The Liberal Party is basically two different parties. There’s the moderates, which are much closer to the Labour Party, and then there’s a harder right that is closer to the Nats and One Nation. And it just doesn’t structurally work anymore, and you’re seeing this play out slowly and embarrassingly for the Coalition, which is definitely broken now. Of course, it broke after the election for a few weeks, you’ll remember?
Chris Smith:
Yeah.
Adam Creighton:
And it should have. They should have stayed broken so they can each work out what they stand for. Isn’t it extraordinary that it’s so long since the election and the Liberal Party was doing some review … Have you read the review? I haven’t read the review. It’s been a long time.
Chris Smith:
Well, apparently the review can’t be released because Peter Dutton claims it’s defamatory.
Adam Creighton:
Well, that just goes to show the extent of the infighting. But on the two fundamental issues Australia’s facing, immigration and energy, I don’t know what the Liberal Party stands for.
Chris Smith:
No.
Adam Creighton:
And the only party that people do, that Joe Blow does know, that’s one nation. They know what they stand for, and that’s to no surprise, up to 23% primary vote. So I think they need to sort themselves out. It’s going to be a very painful few months for the Coalition. And actually this should have been a loss for the prime minister, for Anthony Albanese. And he’s basically coming out of this looking much better than the Opposition.
Chris Smith:
Well, he’s the victor in all of this.
Adam Creighton:
Yeah. Right.
Chris Smith:
The Coalition, his opposition, cracked to smithereens, maybe the end of the leader that he faces directly. He’s got his hate speech laws through, although they’re much greatly watered down and probably mean nothing. He’s got his gun laws through, so he’s appeased some under his electorates. But he’s the victor here. Sussan Ley will be gone. I think she might be gone as soon as Tuesday next week.
Adam Creighton:
Look, yeah, that’s possible. It’s a short-term victory. If the Liberals do find a better leader than Sussan … And let’s face it, she hasn’t set the world on fire. She has not been very good at all at cut-through, zero cut-through. So if they get a better leader, maybe Andrew Hastie or Angus Taylor, or someone that we don’t know yet who will probably put their hand up, I imagine, then things could change. But fundamentally, as I said before, there’s too much disagreement on fundamental issues within the Coalition. So within the Liberal Party, let alone the Coalition. And of course, the Nats are very nervous about One Nation, as they should be. The 23% Coalition primary, the Liberals are actually lower than One Nation, and certainly the Nats are too. So there’d be a lot of very nervous MPs in parliament, very worried about their jobs at the next election.
Chris Smith:
My gut feeling is that David Littleproud and the National MPs are doing what they’re doing right now because they too want to get rid of Sussan Ley. They want to get rid of the weaker part of the Coalition and have the Coalition reignited again.
Adam Creighton:
Yeah. And to do that, realistically it may even require a new political party. I don’t know whether that is possible with the structure of these two different parties. I think it’s going to be very, very painful. How do you get rid of that, say third of liberals who really should be in the Labour Party? That’s very, very hard to do. So yeah, I don’t know, the right is in all sorts of pain in this country, and ultimately, the country suffers because we’re not focusing on the things that matter. We’re focusing on politics inside beltway issues. The average person in the street couldn’t care whether there’s a formal agreement between the Liberal Party and National Party.
Chris Smith:
No.
Adam Creighton:
They just want good reform, good change, and to try to get the country back on track. This is a horrible distraction. So let’s hope it ends soon, but it’s probably not going to end. There’ll be a lot more infighting to come.
Chris Smith:
The President of the United States of America went over to Davos, he gave them what for as to where they stood. And he, in the meantime, has brokered a deal. He’s used his Truth Social site to announce that the framework for a future deal on Greenland has been brokered. He’s dropped tariff threats against Europe. He said he wouldn’t use force to take Greenland, and that seems it was enough to get Europe, NATO, and Denmark across the line. If correct, he is the master negotiator.
Adam Creighton:
Yeah. Look, that is probably true, and that goes back to his book, The Art of the Deal, where I think there’s a chapter where you say a lot of extreme things, and if you get half of it, then that’s a victory. And I think that’s probably happened here. He’s going to get greater access to Greenland than the US already has. The stock markets are purposely threatening tariffs, and then he said he’s not going to do that, so the market’s up too. The broader point though on Greenland, I don’t really understand why Trump is so obsessed with it. But then again, he’s getting advice from the top echelons of the US bureaucracy. So maybe it is true that China and Russia are doing things up there, but I would’ve just thought that Russia had its hands full in Ukraine, and China is a long way away from Greenland.
Chris Smith:
Yeah.
Adam Creighton:
So I don’t know why Trump is so focused on this. But look, certainly personally, he would see this as a victory and many of his supporters will as well.
Chris Smith:
Yeah, not all my listeners. I’ll get to those listeners who are on the boat right now who want to comment on Donald Trump’s behaviour. Talking about tariffs, Adam Creighton, the AFR is running a story saying the Australian government is considering slapping tariffs on cheap Chinese steel. Now, this would be the steel that is made from coal-fired power stations in which they use Australian coal. But anyway, putting that aside, it’s still a very dangerous thing to tamper with this because the Chinese won’t take it sitting down.
Adam Creighton:
Yeah. Look, I’d be surprised if the government goes ahead with any quotas on tariffs, because as you say, they are our biggest customer and if they wanted to get nasty with Australia, it would cause all sorts of pain. Certainly, it is true that steel imports into Australia have basically doubled from a billion to two billion over the last few years. And that’s partly a function of the fact that steel can’t get into the US anymore because of the tariffs that the US has put on China, and so China’s trying to dump it elsewhere. And I’m sure they are dumping it. It is subsidised by the Chinese government. And by the way, it’s not as good quality, I believe-
Chris Smith:
No, it’s cheap.
Adam Creighton:
… as steel. And also, but it must be said too that on the other side, the Australian government has made it much more expensive to make steel in Australia through its crazy energy policies.
Chris Smith:
Yeah.
Adam Creighton:
So it could lower the cost for Australian producers, but it chooses not to, and so this tariff fighting is not going to happen, I think. The Australian economy, as you know, is already shrinking per capita, and I think the last thing we need is a trade war with China.
Chris Smith:
Yeah, we’ve seen how that turns out. And having said that, I’m glad you mentioned the fact that we’ve made it so difficult to produce steel in this country because of our ideology over what we source as power.
Adam Creighton:
Yeah. No, that is exactly right. Surging energy costs is the biggest problem in Australia. The manufacturing sector has shrunk in Australia faster than any other country in the OECD. I think about 5% of employment now is in manufacturing, and of course, that industry relies on energy more than any other. So there’s a lot of self-inflicted wounds here, and of course now the government is having to bail out smelters. So it kind of puts them out of business with one hand and then bails them out with the other. So we have a lot of crazy economic policy at the moment, which as I said before, we’re not talking about it at the moment, there’s all this kind of political nonsense in Canberra.
Chris Smith:
Yeah. Crazy. Good description. Finally, let’s talk about political and economic policy. The OECD, it’s given the Albanese government a stern talking to saying it needs to cut spending, sort out its tax system, and means test the NDIS. This is not brain surgery, it’s just 100% correct common sense.
Adam Creighton:
Yes. No, that is certainly true, and sadly, none of it is going to happen. They’re all very sensible ideas, including indexing the tax brackets. The NDIS is just a couple of years away from costing more than the entire Australian Defence Force. It’s just mind-blowing. It’s growing about 10%, 15% growth every year. It’s strangling the Australian economy and something has to be done about it to reign it in. Sadly, neither side really likes to talk about it because they’re scared of being accused of being heartless. But the reality is it’s being massively rotted. If you talk to people in the sector, there’s all sorts of dodgy businesses getting money through it and there’s people making claims who should not be making claims.
This was a policy that was meant for people who are profoundly disabled, and about 790,000 people are now on it. And also, remember that you have to be under 65 to be on it, so these are 790,000 people under 65 who are claiming to be severely disabled. The government talks about being a renewable energy superpower. The only superpower we are is disability superpower, and that’s not the one you want to be.
Chris Smith:
Yeah. You’re spot on. Great to have you on the programme on a very busy news day, mate. Thank you very much for your time.
Adam Creighton:
Thank you, Chris.
Chris Smith:
Okay.
Adam Creighton:
Thanks very much. Bye-bye.
Chris Smith:
Adam Creighton, the senior fellow and chief economist with the Institute of Public Affairs, columnist with the Australian-
This transcript with Adam Creighton talking on Mornings with Chris Smith 2SM from 22 January 2026 has been edited for clarity.
