The Australian parliament yesterday held its first sitting since the August 24 ousting of Malcolm Turnbull and the installation of Scott Morrison as the country’s sixth prime minister in the past eight years.

The parliamentary session testified to the crisis wracking not only the governing Liberal-National Party Coalition, but also the Labor Party opposition, the Greens and the various other minor parties and self-styled “independents.”

The Coalition is now effectively functioning as a minority government until a by-election is held to replace Turnbull, who resigned from his seat and left the country. A National member, Kevin Hogan, moved to the “cross-bench” out of disgust with the tearing down of yet another prime minister. The Coalition is therefore only able to rely at present on 73 votes and the speaker, against Labor’s 69 and six on the cross-bench.

Turnbull’s leadership was torn down by the most right-wing faction of the Liberal Party, led by Home Affairs Minister Peter Dutton and former Prime Minister Tony Abbott. For days, the media has been full of accusations by Turnbull backers that the Dutton camp carried out the coup through “bullying” and “intimidation,” especially against female Liberal members.

Labor leader Bill Shorten, however, made no appeal to the Turnbull wing by calling on them to cross the floor and support a no-confidence motion in the government. Instead, Shorten shook Morrison’s hand and allowed business to proceed.

Labor’s decision not to even try to split away members of the government and bring it down is noteworthy given that nationwide opinion polls testify to a sharp fall in Coalition support since Turnbull’s ousting. Based on current estimates, it will lose as many as 30 seats and be thrown out of office at the next election, which must be held no later than May 18, 2019.

On Saturday, the Liberal Party lost 29 percentage points, or half its vote, in a by-election for the regional New South Wales state seat of Wagga Wagga. For the first time in 60 years, the Liberals lost the seat, most likely to an “independent,” with voters citing their hostility to yet another political coup as a significant factor.

The apparent but unstated consensus between the Coalition and Labor is that an election should be delayed for as long as possible, to allow the major parties to try to secure the best result against the myriad third parties and independents that now challenge their position.

Such calculations are being made amid warnings that, 10 years after the global breakdown of 2008, an even more catastrophic financial crisis is looming—which this time could well and truly engulf Australia. Already, increases in US interest rates have caused a significant fall in the Australian currency and pressure to raise domestic interest rates, which could collapse the speculative real estate boom and plunge hundreds of thousands of households into default.

At the same time, successive Labor and Coalition governments have backed the United States in its efforts to economically undermine and militarily provoke China—Australia’s largest trading partner. The Trump administration is now waging an open economic war against Beijing, threatening tens of billions in Australian exports.

There is ample evidence that Washington’s insistence that Australia not waver from its diplomatic and military alliance with the US against China was a factor in Turnbull’s removal. The ousted prime minister had indicated concern in recent months over Trump’s trade war policies. That would have been more than enough to galvanise both the US and Australian military-intelligence apparatus to encourage, behind-the-scenes, moves to replace him.

The Morrison government quickly flagged its loyalty to the US alliance and a common anti-China agenda—regardless of the economic consequences.

Just days before being installed as prime minister, Morrison personally blocked Chinese telecommunications companies Huawei and ZTE from participation in Australia’s 5G network on national security grounds. A leading Navy vice-admiral stated last week that Australian warships, deployed in the Middle East since the 1990s, must be brought back to the Pacific due to a rising “threat” of China.

Days after ousting Turnbull, in a clear signal of fidelity to the US, the government issued a “notice of intention” to deny Chelsea Manning a visa to speak in Australia, on the pretext that she was convicted over her leaking of documents that exposed US and allied war crimes and intrigues in Iraq, Afghanistan and internationally.

Labor fully supports the anti-China US alignment. It remained essentially silent on both the 5G bans and the censorship of Manning.

Labor is also not highlighting in any serious manner how the ousting of Turnbull is part of a conscious effort to refashion the Liberal Party into a more extreme-right movement. With Morrison as leader, the Abbott-Dutton wing is seeking to develop a base of support for militarism and authoritarian forms of rule by promoting economic nationalism, anti-immigrant xenophobia and religious bigotry.

The Coalition has begun laying out a re-election strategy. Firstly, it is putting aside—for the time being—unpopular policies such as corporate tax cuts and increasing the retirement age to 70. It has vowed to lower energy prices, including by opening new coal or gas power stations in defiance of concerns over climate change.

Morrison has announced populist handouts to selected groups, such as farming and regional communities suffering due to drought, and Catholic private schools. He has flagged preventing new immigrants from living in the major cities. The blaming of migration for the crisis of infrastructure in the cities is the xenophobic stock-in-trade of both the Coalition and Labor.

Morrison is particularly seeking to “energise” the Christian base of the Coalition through overtures to religious-based social conservatism, especially homophobia and opposition to same-sex marriage. He has boasted of his evangelistic faith and indicated he will seek to legislate “religious freedom” laws to enable organisations and individuals to discriminate against LGBT people on the grounds of religion.

The religious right is rallying with assertions that “religious freedom” is at risk if the government is not re-elected. One evangelist preacher, Adam F Thompson, responded to Morrison with a YouTube-distributed sermon on the weekend, in which he declared:

“This is a crucial time right now … In the next six months, it’s time for the body of Christ [the Christian church] to put its differences aside … start praying together and calling it in and praying for our prime minister right now, and for our government.

“If the prime minister right now doesn’t get elected in this next election, there’s going to be darkness coming.… The laws are going to change where darkness is going to come and there will be persecution on the church.”

The Liberal Party’s further right-wing lurch is, in the first instance, a bid to win back a layer of about 10 to 15 percent of voters who, out of disaffection and disorientation, have been drawn into supporting populist and generally anti-immigrant organisations that have emerged over the past two decades.

Labor will not oppose the nationalist and anti-immigrant rhetoric of the Coalition. Rather, it will resort to its own strident anti-refugee and anti-immigrant xenophobia and anti-Chinese militarism in a bid to divert mounting discontent.

Both major parties of the establishment are seeking to divide the working class with racism and nationalism ahead of tremendous economic shocks, social upheavals and military conflict.