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Anthony Albanese says the budget was an ideological surrender and Bill Shorten says it was an admission of guilt. Reporting of differences were over-egged. Photograph: Mike Bowers for the Guardian

Perhaps the greatest demonstration of how bereft of purpose the Liberal party has become is that the only thing most commentators agreed about the budget was that it was Labor-lite. But such branding, while a damning indictment of the Liberal party, also contains traps for the ALP should it believe the fight has been won.

Its not hard to see why the budget was quickly viewed as a capitulation to Labor. While the ALP has long argued that revenue needs to be raised, the Liberal party has equally long believed the path to surplus requires cuts to government spending.

And so when the budget contained new taxes and only fractional cuts in total government spending, the natural response was that it appeared a very Laboresque approach.

Measures within the budget also helped with that branding. The bank levy, the increase in the Medicare levy, and the cuts to higher education to pay for schools funding were things either previously proposed or done by the ALP.

But given the budget also carried with it a tax cut for those earning more than $180,000, a continuation of the company tax cuts, and increased penalties for those luxuriating on the $535.60 a fortnight under Newstart, it also begged the question of what it says about the ALP that such a budget could be considered Labor-lite?

It suggests that you dont need a very progressive budget to get that moniker a worrying thing for the ALP and explains somewhat the response in the past two weeks by Bill Shorten and Anthony Albanese.

The response by Albanese this week also brought with it some odd suggestions that he was attacking Shorten. The basis of this were suggestions his speech to the Transport Workers Union was greatly different to Shortens budget reply.

Clearly I need to read more between the lines or ignore a lot more of the actual text, because to me the differences were merely rhetorical. Albanese, for example, asserted that the budget was an ideological surrender by the LNP; Shorten by contrast labelled it an admission of guilt.

Perhaps there is a difference there, but certainly not enough to be worthy of the over-egged headlines suggesting Albanese is making a leadership move.

But while there is a need for the ALP, as Albanese puts it, to celebrate their victories, the ALP likewise should shudder to think voters might think this budget was a Labor one.

Winning from opposition is hard enough without having voters already thinking theres not much point changing government. So it was not surprising Shortens budget reply speech focussed on the theme that this is not a Labor budget.

That desire to differentiate also highlights the need for the ALP to keep pushing its agenda even at the risk (such that it is) of being seen as too left.

In this context, Shortens decision to keep the 2% deficit levy for those earning over $180,000 is eminently sensible. Indeed the best thing about the decision is it has revealed the limpness of the arguments opposing it.

An ALP leader who doesnt get accused of class warfare after a budget reply speech has fallen at the first hurdle.

For example, because it would see a top tax rate of 49.5%, Scott Morrison, has taken to suggesting it means people earning over $180,000 would spend one day working for the Government and one day working for yourself.

Such purposeful misleading of how the income tax system works where you only pay the top tax rate on money earned over $180,000 is telling. You only need to mislead when the truth would highlight the weakness of your argument.

Of course all the talk of the horrors of a 49.5% tax rate forgets that this very day with the deficit levy still in place (it ends on 30 June) and the current Medicare levy of 2%, the top tax rate is 49%.

Who would have thought a 0.5% increase was enough to turn Australia into a socialist paradise?

That measure plus the policy to increase the Medicare levy only for people earning over $87,000 led to the conservative media branding Shorten as indulging in class war. That should not worry him. An ALP leader who doesnt get accused of class warfare after a budget reply speech has essentially fallen at the first hurdle.

But while keeping the deficit levy is understandable, the position on the Medicare levy is less clear. Given the Gillard government had raised the rate from 1.5% to 2% for the same reason, it is a bit odd to now suggest it should only apply to those earning over $87,000.

As Katharine Murphy noted it means the ALP has to find money elsewhere to fund its own policies policies that will differentiate itself much more effectively from the government than will the Medicare levy.

But while Albanese may not be about to challenge for the leadership (unless Shorten commits more unforced errors such as the Australians first advert), there remains a strong policy debate within the ALP.

The recent Guardian Australian politics live podcasts featuring Wayne Swan and Chris Bowen highlight the intriguing debate going on within the party.

On the surface it is between the centre and the left, but more accurately it is over how progressive that centre should be.

And while the calls from many in the media for the ALP to return to a sensible centre will resonate loudly, the budget shows Labor does best when it pushes that centre towards the progressive side of politics.

A Labor budget needs to be marked as being more than one where taxes are increased and that might entail grabbing some of the revenue delivered by the Liberal partys capitulation and spending it in different ways.

Because while the Liberal party might now agree on the need to raise revenue, how that revenue is spent remains very much in dispute.

The ideological battle over how you can return the budget to surplus appears to be won, but that is not the war and in truth it was always a sideshow.

How and to whom government services and benefits are delivered, what rights you have at work, whether or not your family has decent access to education, health and child care, are always of much greater concern to voters than how the budget is predicted to return to surplus in four years time.

Just because the Liberal party may have raised the ideological white flag, doesnt mean the ALP needs to put up the mission accomplished banner.

Read more here:
Liberals raise budget white flag, but Labor can't put up 'mission accomplished' banner - The Guardian