Josh Frydenberg is betting business and households will take advantage of tax cuts and concessions to invest and spend more. But he’s keeping his fiscal options open even after such a big-spending budget.

The catch is the arrival of a vaccine defies prediction and is beyond the control of any Australian government while even state borders are clearly beyond the control of a federal government.
So a Queensland premier fighting for re-election is playing ever harder politics on hard borders, suggesting on Wednesday the state will further delay opening the border to NSW after three possible cases of community transmission to its south.
NSW Treasurer Dominic Perrottet was even more barbed in his criticism than Premier Gladys Berejiklian, describing Queensland as beautiful one day, subsidised by NSW the next.
Little wonder Frydenberg was enthusiastically pushing state treasurers to do more themselves to boost their own economies.
In Victoria, Daniel Andrews is typically reluctant to confirm whether the planned October 19 date for even slightly easing some of the strict lockdown will proceed after new concerns about the number of mystery cases. Businesses desperate for some certainty on whether to put on staff and provisions for reopening in less than two weeks are also as usual languishing in commercial limbo.
In Western Australia, a surging iron ore industry has actually left the McGowan government with a small budget surplus!
Yet the board of state and territory treasurers could somehow agree on a joint statement on Wednesday praising their own record of deploying significant protective and stimulatory measures.
Now is the right time to make these vital investments supported by additional financial assistance from the Australian government and a manageable increase in borrowings where necessary, they proudly declared.
But those same states have been cautious in their own COVID-19 spending so far, relying instead on Canberra to bail out their economies while they focus on taking credit for controlling the virus.
That the statement was formally distributed by Victorian Treasurer Tim Pallas as board chairman must only have made it more galling for a federal Treasurer who had just unveiled a deficit of $214 billion for this financial year assuming things go according to those optimistic assumptions.
Little wonder Frydenberg was enthusiastically pushing state treasurers to do more themselves to boost their own economies.
I say to all state premiers and all state treasurers . . . ‘please dig deep, support your communities, spend more through this crisis and share some of that burden, he declared.
How and when that will happen remains an open question despite earnest statements of political intent from premiers.
But as shown up by the extraordinary budget, the Morrison government is focused on the absolute urgency of stimulating private sector investment and jobs in the here and now. Thats why so many budget measures are temporary and front-ended over the next year or two rather than adding up figures over four years or even a decade to make spending seem more dramatic. No need for exaggeration this time.
Much of the money will flow through relatively quickly. The uncertainty is how much this will in turn generate jobs and investment by businesses that had been reluctant long before anyone had heard of COVID-19. Relieved retailers are still hopeful the boost to incomes and confidence will play out in Christmas sales.
But the government also cites the experience of previous recessions to demonstrate how long it takes to get unemployment down again. Frydenbergs goal of an unemployment rate comfortably under 6 per cent before budget repair gives him several years of leeway.
Labor has already said it will support personal income tax cuts and is inclined to support business tax concessions although it wants to look closely at the proposals.
The opposition certainly understands, however, that standing in the way of almost any spending right now is dangerous territory, especially when Frydenberg has deliberately avoided flashpoints like bringing forward the tax cuts for high-income earners as well. Demands for long term structural economic reforms are for another year, another fight.
It means Anthony Albaneses budget reply speech on Thursday is likely to instead focus on the need to spend even more in areas like childcare, social housing and infrastructure as well as maintaining higher JobKeeper and JobSeeker payments.
But Scott Morrison and Josh Frydenberg have been careful to indicate this budget plan will not be the last throw of the economic dice especially if its assumptions prove optimistic.
It insists none of the measures announced this week depend on those assumptions being met. The government also has another mid-year economic statement due in December and yet another budget next May. Expect more billions to be in play.
Right now, though, its time for the big belated budget sell of 2020. Roll up, roll up.