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The Australian economy under Abbott: a (rough) Crikey guide

The Australian economy may not look significantly different under an Abbott government, despite the Coalition’s rhetoric. Bernard Keane and Glenn Dyer with the Crikey crystal ball.

How would the Australian economy fare under a re-elected Labor government or a newly elected Abbott government?

The answer is complicated: the opposition is refusing to spell out in detail its economic and fiscal policies, and in any event governments respond to changing circumstances in a way often at odds with their stated policies and election commitments. And we don’t know the make-up of the Senate from July 1, 2014 so it’s hard to know what capacity either side would have to get its legislative agenda through.

But we have enough sense of Labor and Coalition policies — assuming they broadly adhere to them and get to implement them – to get some idea of the different paths the economy might take under each.

Today, the Coalition. While there’s limited detail and some confusion about the Coalition’s fiscal policy, Joe Hockey, Tony Abbott and Andrew Robb have laid out some important pointers:

  • A tighter fiscal policy than Labor
  • Significant cuts in the public service beyond those already achieved by the government, including removal of duplication of functions at state and Commonwealth level
  • Lower personal taxes and abolition of the carbon price and mining tax
  • Measures to lift workforce participation
  • Cutting regulatory costs for business by $1 billion a year
  • Labour market reforms but not a return to WorkChoices
  • Tax breaks to drive greater private sector investment in infrastructure.

Some other policies are also relevant: more red tape for foreign investment, anti-dumping and, potentially, wheat marketing and less red tape for uranium sales to India, as well as a more generous paid parental leave scheme than Labor’s offering.

The logical upshot of the Coalition’s approach is significant spending cuts: not merely does the Coalition intend to run a tighter fiscal policy than Labor, but run one while offering tax cuts — eliminating the carbon price (most revenue of which is redirected to free permits to polluters, so the overall impact is limited), eliminating the mining tax (the impact of which is heavily dependent on the coal and iron ore price) and reducing personal income taxes.

However, the net effect on the Commonwealth’s contribution to demand will, because of those tax cuts, only reduce by the extent to which the Coalition’s fiscal policy is tighter: if for example Labor projects a $2 billion surplus in 2013-14 in the May budget and the Coalition aims instead for a $5 billion deficit in 2013-14, the net impact on demand is, at $3 billion, fairly trivial. The issue will be what services and programs are cut to meet the Coalition’s policy requirements.

In the longer term, the Coalition is committed to an absolute reduction in the size of government, via public service cuts, a National Commission of Audit and Robb’s proposal to eliminate duplication between state and federal governments. The Coalition has talked tough on reducing government before and signally failed to follow through — the Howard government in fact became the biggest taxing government in Australian history. But in the event the Coalition follows through, any longer-term permanent cuts in spending would presumably be accompanied by tax cuts, negating the impact on demand. The real issue in that event would be whether tax cuts are simply handed back to voters, Howard style, or they are used to eliminate inefficient taxes or encourage investment.

In short, the Coalition’s commitment to tighter fiscal policy is unlikely to materially affect overall growth, although if broader economic conditions are soft, blindly following a tighter fiscal policy will exacerbate that softness and may precipitate a downturn. The Reserve Bank will have some additional room to cut interest rates, but the stimulatory impact of monetary policy is likely to decline, given the RBA already has rates at extraordinary lows. On monetary policy and finance more generally, Joe Hockey has promised a major inquiry into the financial system, and also seemed to suggest he will be more effective at convincing the big banks to pass on all interest rate cuts. If that were the case, the RBA would actually be able to cut rates less, knowing the full cut will be delivered through to consumers.

All up, the economy under the Coalition is on current evidence unlikely, at least over the course of its first term, to look significantly different to how it looks now …”

A tighter fiscal policy might also place upward pressure on the dollar, by reinforcing Australia’s safe haven status, especially if the RBA has little room left to further cut rates — but again, the material effect is likely to be limited.

Economic growth might also benefit from any rise in consumer confidence that comes from the return to majority government, potentially flowing through to retail sales, although retail’s “problems” are primarily structural rather than due to a lack of consumer vim and vigour.

But nothing in the Coalition’s current policy set appears aimed at addressing the persistent stagnation of residential construction, which the RBA is hoping will pick up the slack through this year as the mining investment boom peaks and comes off the boil.

The Coalition policy to cut red tape worth $1 billion a year, while worthy, is unlikely to have any significant economic impact; as the majority of red tape costs are in the time and resources required for compliance (particularly for small business), such savings are likely to be absorbed directly by business, and in any event are too small to produce a noticeable difference to economic growth.

And any additional investment generated by reductions in red tape may be offset by increases in reporting requirements for foreign investors proposed by the National Party, re-regulation of wheat sales at the behest of an uncompetitive section of wheat industry and the imposition of even more “anti-dumping” laws, an issue on which the Coalition appears determined to outflank Labor to the Left.

The Coalition is, however, likely to have mixed fortunes on productivity, which it identifies as a priority. Multifactor productivity is likely improve naturally as the vast spate of mining projects currently under construction mature. It may also benefit from greater investment in infrastructure, which is the goal of Robb’s (inaptly-named) infrastructure bonds proposal, although that will be balanced by the abandonment of the NBN in favour of Malcolm Turnbull’s bizarre, copper-based FTTN proposal.

Workplace relations reforms intended to give employers more power to drive productivity reforms will, perversely, likely lead to reversals of the labour productivity gains currently occurring under Labor. The decline in labour productivity under WorkChoices has been well-established and indeed was predicted by Treasury prior to the introduction of those reforms; any move back toward WorkChoices-like workplace relations laws are likely to once again send labour productivity into reverse. On the upside, there is likely to be fewer days lost to industrial disputes. Against that, the restoration of the Australian Building and Construction Commission will see a rise in the number of construction workers being killed and injured on the job.

The Howard government presided over a significant increase in workforce participation (one area where Labor has performed poorly). A more generous paid parental leave scheme may help marginally, as will IR deregulation (a key reason for the decline in labour productivity under WorkChoices was the entry into the workforce of poorly skilled workers made more employable by the ease with which they could be sacked). It should also be noted that a big rise in participation will send the unemployment rate up, with more people looking for work.

And whatever gains have been made in the decarbonisation of the Australian economy by the time the removal of the carbon price is achieved are likely to be reversed under the Coalition; its “direct action” policy is grossly underfunded and, in the absence of a fairly significant funding increase — of some billions — is likely to ensure Australia fails to achieve its emissions reduction target by 2020.

All up, the economy under the Coalition is on current evidence unlikely, at least over the course of its first term, to look significantly different to how it looks now, assuming similar conditions. A global slowdown or difficulties in China would mean slower growth and demand more fiscal flexibility from the Coalition that its hairy chested rhetoric now suggests. But that picture may change substantially once we start seeing some real detail about what Joe Hockey would do as Treasurer.

53
  • 1
    Barrie O'Shea
    Posted Tuesday, 5 February 2013 at 1:51 pm | Permalink

    In my 38 years in SMEs, I have had one unfair dismissal case, which was dismissed in half an hour at no cost to me. However, my losses in those 38 years to incompetent or corrupt behaviour by other businessmen would approach $500,000. Not one of those people has lost their house, or been fined or jailed for their actions. In most cases, they have had substantial unpaid tax and superannuation liabilities.

    As you can imagine, the laws that I want changed are not those relating to my workforce. I want to see substantial penalties including jail, for those who, by evading their responsibilities, are able to improve their cash flow and compete unfairly in the marketplace. Despite legislation from both parties, the use of phoenix companies is still rampant.

    So Tony, forget the unions. Stop listening to the Billy Tea Party supporters in your ranks. Give the ATO and ASIC the resources they need to enforce the law. That is the best way to reduce business costs and encourage legitimate businesses to grow and employ people.

  • 2
    Apollo
    Posted Tuesday, 5 February 2013 at 1:55 pm | Permalink

    The LNP can achieve reduction in CO2 emission by putting the economy into a recession. That’s how the US has been able to reduce its emission.

    The Howard government was better at making work participation higher because they made it a b*tch to be receiving and living on the dole, I heard that the number receiving the dole dropped from 22 or 27% down to 15%.

    I don’t bel i.e.ve dogmatically in a free trade absolute when there is no fair level of play ing field, especially now that most of China’s companies have unlimited backing from the government as they are state own, it’s very hard to compete with them. My suggestion is at least have 1% tariff on products from countries which don’t have carbon tax, and 5% for countries where businesses don’t have the same level of just rewards and protection for the workers and the environment. Might have a levy for Australian companies who outsource to those countries too. It will be interesting the see Bob Katter’s party influence on policy if they have the balance of power.

    I have a good idea to restructure the baby bonus to a planned parental scheme, but I don’t have the time to write it now. TA will be very strong on policy for Australians to “go forth and multiply”.

  • 3
    IC-1101
    Posted Tuesday, 5 February 2013 at 2:03 pm | Permalink

    Howard made it tough to earn the dole for people that didn’t deserve. If you deserve it — if you’re unable to work, can’t work, mentally disabled — then you should get it. Under a Labor government, the welfare test has always been far too easy. I know students get handouts that basically double as beer money.

  • 4
    Jimmy
    Posted Tuesday, 5 February 2013 at 2:05 pm | Permalink

    Not sure I agree with some of the assumptions here. Are the MRRT and Carbon taxes reducing growth by that much? Will their removal increase growth by the same amount as growth is reduced by slashing public sector jobs?

    There are also a lot of questions regarding wealth distribution that need answering, the libs are planning to remove means testing for the private health rebate and FTB and slash the School kids bonus, shifting money from low income earners to higher income earners, similarly the Libs plan to stop the $500 super payment for low income earners but keep the variuos tax concessions generally taken up by higher income earners, the ALP has announced anything on this but if they make any changes it will probably be in the opposite direction. Also getting tax payers to pay up to $75k for paid maternity leave is also a poor use of public funds and skewing the benefits towards the top end.

    Also I think the impact on the ability to grow a non renewable energy sector in the Carbon Price V Direct action comparison is well and truly understated.

    On top of it all tighter fiscal policy could well be the worst possible approach if the economy continues to slow.

    I have said it before cutting taxes, increasing spending and increasing a surplus doesn’t work, something has to give.

  • 5
    Jimmy
    Posted Tuesday, 5 February 2013 at 2:17 pm | Permalink

    Are the MRRT and Carbon taxes reducing growth by that much? Will their removal increase growth by the same amount as growth is reduced by slashing public sector jobs?” Further to this point, how does the fact that mining company (and others effected by the Carbon Tax) profits are returned to share holders which are not necessarily Australian contrast to the removal of expenditure (ie Public sector wages) that are 100% paid in Australia?

    eliminating the carbon price (most revenue of which is redirected to free permits to polluters, so the overall impact is limited)” This is looking distinctly short term, what will the impact be as the free permits recede and the direct action doesn’t work?

  • 6
    Joe Magill
    Posted Tuesday, 5 February 2013 at 2:31 pm | Permalink

    cut red tape worth $1 billion a year” . I keep hearing this red tape argument but in my 30 year old small manufacturing business I face zero red tape. I complete one ABS return per year which takes a day or two to complete but as a user of the ABS I don’t have any problem with that task at all. If red tape means EIS or land development approvals then I’m not sure that I would liek to see a reduced oversight in this field.

  • 7
    Ruprecht
    Posted Tuesday, 5 February 2013 at 2:55 pm | Permalink

    Nah, mass public service sackings and cuts to health and education won’t have much impact on the economy.

    Reintroducing WorkChoices and abandoning the NBN won’t provide another drag on the economy.

    We’ll be right.

  • 8
    Hamis Hill
    Posted Tuesday, 5 February 2013 at 2:57 pm | Permalink

    East Coast LNP state government austerity measures have contracted the economy and certainly and cynically destroyed the federal budget surplus by reducing federal income.
    The other effect of such LNP austerity when projected onto an Abbott administration is a general reduction in money in the economy and so the inducement of interest rate rises.
    So the Bill for the Howard, golden era, mortgage debt orgy will rise to two thousand million dollars a week in interest payments.(Do the numbers; they are important)
    Those who cannot see RECSSION writ large in these figures are simply economic vandals.
    Of course an Abbott administration aping the policies of its state colleagues will be different from a Labor federal government which does not ape those LNP policies.
    To suggest otherwise is simply moronic.

  • 9
    Jimmy
    Posted Tuesday, 5 February 2013 at 2:59 pm | Permalink

    Joe Magill - ““cut red tape worth $1 billion a year” He may as well say “I’m going to raise Unicorns worth $1b a year” It’s a figure that they will never be able to prove he did or didn’t do because no one can identify “the red tape” let alone accurately cost it.

    The other figure I love Abbott quoting is the number of jobs his govt would create (2m over 10 years I think is the figure is) which given the ALP is up to almost 1m over the past 5 and a bit which included the GFC is very unambitious. In fact the figure is taken straight from the Republican play book where Romeny promised to create X million of jobs in his first term which sounded large but basically was what a monkey would create if he were running the country.

  • 10
    Microseris
    Posted Tuesday, 5 February 2013 at 3:37 pm | Permalink

    As Ruprect & HH point out, LNP has tunnel vision on fiscal policy. Slash the public service, gut education and health. This increases unemployment with flow on effects across the economy. In Victoria one term Ted has slashed TAFE and VCAL programs and with the savings built a new jail. Got to have somewhere to lock up all the resulting delinquents.

  • 11
    Honest Johnny
    Posted Tuesday, 5 February 2013 at 4:40 pm | Permalink

    Can I get the NBN connected before its abandoned for a copper-based FTTN? My ADSL is as slow as a wet week and my small business needs a fast broadband. Do they take requests?

  • 12
    Posted Tuesday, 5 February 2013 at 4:45 pm | Permalink

    I have yet to meet a conservative politician or supporter who can articulate a sound reason behind cutting taxes. From where I see it - as a public sector Registered Nurse - our very problem lies in the fact that our tax take is not enough.

    This is due in part to rising costs across the board but also due to people not paying their fair share of tax - the tax that they should be paying. I agree that the ATO and ASIC should be enforcing the law and ensuring compliance across all tax payers regardless of station.

    Further - I have no issue with public service cuts, so long as they are not cuts to front line services. There is a lot of dead wood in the public service - including government - and the sooner that dead wood is gotten rid of, the better.

    In my industry alone, I don’t think I’ve seen a greater level of superfluous bean counters and confected tiers of management in my 20 years of practice than I do now.

  • 13
    Honest Johnny
    Posted Tuesday, 5 February 2013 at 4:48 pm | Permalink

    I saw a Liberal Party ad on television last night where TAbbott said they would create 2 million jobs. Assuming the 654,000 currently unemployed take a job each, how are the other 1,346,000 jobs going to be filled? What will happen to productivity?

  • 14
    Holden Back
    Posted Tuesday, 5 February 2013 at 4:52 pm | Permalink

    @Honest Johnny, yes they take requests, but you’ll only get joy if you ask for “The Time Warp”.

  • 15
    klewso
    Posted Tuesday, 5 February 2013 at 6:31 pm | Permalink

    It’ll be rough all right - ever been reduced to using a hession chaff-bag to “wipe up after” a curry night?

  • 16
    Mike Flanagan
    Posted Tuesday, 5 February 2013 at 6:42 pm | Permalink

    In making this assessment did you use Abbotts written and signed data or his worthless verbal assertions.

  • 17
    iggy648
    Posted Tuesday, 5 February 2013 at 7:17 pm | Permalink

    Honest Johnny :”Can I get the NBN connected before its abandoned for a copper-based FTTN?” I’m gunna move to somewhere that already has optic fibre. It will give me a competitive edge! And as a bonus, it is a part of the telecommunications system that won’t be damaged by large solar flares.

  • 18
    Kevin
    Posted Tuesday, 5 February 2013 at 7:19 pm | Permalink

    @banistersmind If the QLD LNP plan is the blueprint for an Abbott Coalition government, The definition of ‘frontline services’ will be reduced, in order to maximise the number of lower paid workers put off (ie the Energex workers heading to the flood repairs being advised to consider ‘voluntary redundancy’ packages)…. Meanwhile middle and upper management will be busy reinforcing their kingdoms, to keep their own high paying jobs.

  • 19
    the duke
    Posted Tuesday, 5 February 2013 at 9:32 pm | Permalink

    ughhhh deja vu.. all the Liberal Party needs to do is connect with the electorate and then they have already surpassed the wasted years of Rudd and Gillard.. @ Klewso - hahahahahahahaha horrible thought!

  • 20
    the duke
    Posted Tuesday, 5 February 2013 at 9:37 pm | Permalink

    whatever happened to the grand idea of lessening Corporate Tax rates to encourage global funds to make a base in Australia and thus challenge Singapore as the banking power of South East Asia? also, how the ALP has let the LNP fool the electorate in thinking that a debt to GDP ratio of c15% is bad is beyond me.

  • 21
    Sharkie
    Posted Tuesday, 5 February 2013 at 9:53 pm | Permalink

    It will be reagannomics down under if the conservatives get elected. Abbott and co will find it very easy to bring in tax cuts, but find it very difficult to make the spending cuts to balance a budget. The poor will get wacked, but I can’t see sloppy joe cutting into middle class or corporate welfare.
    By the end of reagan’s reign, debt was at record levels in the USA and you couldn’t find an empty bridge to live under. It’s where Australia will head under Abbott.

  • 22
    Hamis Hill
    Posted Tuesday, 5 February 2013 at 10:37 pm | Permalink

    Work Choices? In Abbott’s Recession there won’t be any choices; there won’t be any work.
    Start practising the forelock tugging!

  • 23
    drsmithy
    Posted Tuesday, 5 February 2013 at 10:41 pm | Permalink

    I saw a Liberal Party ad on television last night where TAbbott said they would create 2 million jobs. Assuming the 654,000 currently unemployed take a job each, how are the other 1,346,000 jobs going to be filled?

    Immigration, of course. Gotta keep that housing ponzi going somehow.

    Keeping worker’s wages depressed is just icing on the cake.

  • 24
    Timothy Reichle
    Posted Wednesday, 6 February 2013 at 12:29 am | Permalink

    >if for example Labor projects a $2 billion surplus in 2013-14 in the May budget and the Coalition aims instead for a $5 billion deficit in 2013-14, the net impact on demand is, at $3 billion, fairly trivial.

    The difference between a $2 billion surplus and a $5 billion deficit is 7 million. Did you mean for both to have a surplus?

  • 25
    the duke
    Posted Wednesday, 6 February 2013 at 8:52 am | Permalink

    ahh c’mon guys, remove your rose coloured glasses.. just how is the present government justifying another term? in fact, basically, they were a 1 term government. I am a swinging voter, I didn’t get caught up in Kevin 07, nor am I infatuated with Abbott, but someone else simply deserves a go. We have a PM and treasurer that cannot connect with the business community and cannot deliver confidence to the business community, everything else is just a side show.

  • 26
    drsmithy
    Posted Wednesday, 6 February 2013 at 9:49 am | Permalink

    ahh c’mon guys, remove your rose coloured glasses.. just how is the present government justifying another term?

    That’s not the question. The question is how is anyone else justifying *a* term ?

    The answer, thus far, is “poorly”.

  • 27
    Mike Flanagan
    Posted Wednesday, 6 February 2013 at 10:03 am | Permalink

    the duke;
    You indicate as a swinging voter you are an analytic person of policy and identify the party that offers the best option to suit your purposes before voting.
    On that assumption I would suggest you carefully read between the lines of the policy on offer by the Abbott led LNP.
    We only have to observe his party’s actions in the state sphere to see little that he promulgates bears any reality to what will transpire.
    Even the newly elected opposition leader of SA states he has no “specific plan” to sack public servants but some bright journalist might ask him whether he has a an ‘unspecific policy’ to do the very thing he offers a qualified denial on.
    Likewise a careful analysis of Abbott’s policy on climate change will demonstrate he is beholden to those in the party that intend to copy Boris Johnson of London in ignoring the challenges that presents, and set about a programme of obfuscation and avoidance of his responsibities and policy action.
    His economic policies, as promulgated in his latest advertising, are nothing more than a series of ‘motherhood’ statements and are threadbare on factual details.
    Abbott refuses to identify the real challenges this nation faces in coming years and is the most unfit potential leader of this nation I have witnessed in fifty odd years of voting.

  • 28
    K.D. Afford
    Posted Wednesday, 6 February 2013 at 10:03 am | Permalink

    Whilst castigating the Labor government for pulling back on a promised balanced budget( Joe Hockey said the PM promised one 161 times) I ask what sort of crystal ball is Joe Hockey looking into promising the same things?
    We have seen how the US is in dire straights with falling taxation revenue since Reagan was in, the LIBs deny Climate Change and in doing so totally overlook the ability of that to affect the outcomes. Passing off the Qld. floods as a 1:200 year event and getting rid of the carbon and mining taxes and offering lower taxes is to offer us a free ride into poverty and self destruction.

  • 29
    klewso
    Posted Wednesday, 6 February 2013 at 10:41 am | Permalink

    The questions are “Do we really deserve Abbott? What have we done?”

    What did the introduction of the cane toad do to the cane beetle and anything else?

  • 30
    klewso
    Posted Wednesday, 6 February 2013 at 10:50 am | Permalink

    We’ve still got that beetle - and a lot less other things.

    Another hung (Abbott) parliament would be best - if only to see how he copes/”cops”.
    With more independents/lesser parties (Greens with one in nine votes and only one in 150 seats - that’s “democracy”?) in a lower house truly indicative of voter views.

  • 31
    the duke
    Posted Wednesday, 6 February 2013 at 10:55 am | Permalink

    fair point drsmithy however, it is clearly obvious that the current government has been a failure and that something has to change. Rudd absolutely trumped Howard and was supposedly a viable alternative, but turned out to be a lemon. Rudd was a failure and Gillard has also been a failure. Just like a change in coach can change the fortunes of an underperforming, but talented, football team, the same needs to happen with our leadership - in my opinion!

  • 32
    Mike Flanagan
    Posted Wednesday, 6 February 2013 at 11:09 am | Permalink

    the duke;
    Ms Gillard’s failures have been more about projection as displayed by the MSM rather than attention to policy. The MSM led by the Murdoch neocon rags and cloned by the Fairfax Press and the ABC under Scott have shown an abysmal attention to presenting the facts about the alternative under Abbott on offer.

    Crikey
    Your moderator bears no relationship to your published policy on moderation. In fact it indicates a policy of churning subscribers and contributors rather than facilitating open and free comment.

  • 33
    JMNO
    Posted Wednesday, 6 February 2013 at 11:42 am | Permalink

    I am disappointed in this article. It is written in ‘economic-ese’ - generalities, pulleys-and-levers, rather than close examination of the specifics. Abbott’s policy document is warm and fuzzy not to offend anyone and if looked at closely is full of massive contradictions or raises big questions that are not answered. For example, how can he keep current fair work legislation, not go back to work choices and do the things he claims he will do? You can say you are going to cut red tape but what are you actually going to do? (arguably it was a lack of red tape that caused the insulation program disasters). Where are they going to cut duplication between the states and the commonwealth apart from handing over environmental decision-making to the states? etc etc. How can you cut all those taxes, restore/increase upperclass welfare and still have a surplus? Where are the sums? If you have the policies you should have costed them.

    Ian McCauley’s article on the New Matilda website has a much more critical examination of Abbott’s cloud cuckoo-land economic policies.

  • 34
    Chris Peisley
    Posted Wednesday, 6 February 2013 at 2:16 pm | Permalink

    The artical “The Australian economy under Abbott a (rough) Crikey guide” penned by BERNARD KEANE AND GLENN DYER, makes the statement at para 16 quote ” the restoration of the Australian Building and Construction Commission will see a rise in the number of construction workers being killed and injured on the job”

    Question: Would Crikey be kind enough to provide a reference to the data in which this statement has been draw?

  • 35
    drsmithy
    Posted Wednesday, 6 February 2013 at 2:41 pm | Permalink

    fair point drsmithy however, it is clearly obvious that the current government has been a failure and that something has to change.

    Define “failure”.

    Because most of the “failure” I see from our current Government is their lack of change to the policy disasters wrought upon Australia by Howard & Co.

    There is precious little of substance to differentiate between Howard’s Liberals (which, hold no illusions, is the benchmark Abbot’s Liberals will strive for) and Rudd/Gillard’s (New) Labor.

    We’re not going to see change in this country so long as we keep voting in Governments playing from the same neoliberal, neoconservative rulebook.

  • 36
    the duke
    Posted Wednesday, 6 February 2013 at 3:07 pm | Permalink

    I don’t disagree drsmithy.. the ALP failed to use their political capital effectively when they were voted into power in 2007. The biggest issue for me has been that the party has lacked charisma and has failed to connect with the electorate, primarily the business community. Comparing Swan to Costello is like comparing chalk and cheese. Love or hate Costello, he was able to give business confidence and the banks/RBA respected him.

  • 37
    drsmithy
    Posted Wednesday, 6 February 2013 at 3:32 pm | Permalink

    Businesses don’t lack confidence because of Swan, they lack confidence because - between the GFC/Great Recession and the high currency - the outlook for just about every business except resources and rent-seeking is best described as “dire”.

  • 38
    K.D. Afford
    Posted Wednesday, 6 February 2013 at 5:41 pm | Permalink

    drsmithy, it is because we have reached The End of Growth, read Richard Heinberg - it is why business is wary, but government is not, yet!
    Least of all the LNP.

  • 39
    Hamis Hill
    Posted Wednesday, 6 February 2013 at 6:58 pm | Permalink

    One and one quarter trillion dollars of private mortgage debt is the economic dung heap left behend by eleven years of conservative government.
    All attempts to bring this into a rational debate are drowned by the buzzing of the blowflies which live on Howard’s debt dung heap.
    When Abbott’s policies raise interest rates, the price of Howard’s private debt orgy will be two hundred dollars a week, every week for each of the nation’ ten million wage and salary earners.
    Buzz on that!
    And a man who still has a three quarters of a million dollar mortgage at the age of fifty five sure looks like the King of Howard’s morgage dung heap.
    That’s exactly what an Abbott PM means.

  • 40
    Hamis Hill
    Posted Wednesday, 6 February 2013 at 7:23 pm | Permalink

    One and one quarter trillion dollars of private mortgage debt is the economic dung heap left behind by eleven years of conservative government.
    All attempts to bring this debt into the debate is drowned out by the buzzing of the blowfl ies living on Howard’s economic dung heap.
    When Abbott PM’s policies raise interest rates, the price of the Howard era’s private debt orgy will be two hundred dollars a week, every week, for every one of Australia’s ten million wage and salary earners for year after year after year.
    There will not be a re-run of the “Golden Era”.
    Call it a, rub your nose in it, great big (economy destroying) poverty tax.
    And a man who, at the age of fifty five, still has a three quarter of a million dollar mortgage debt certainly looks like the King of Howard’s economy wrecking private debt dung heap.
    That is exactly what an Abbott PM means.
    Buzz, Buzz, Buzzz? Rise maggotts and hail your Lord, King of the mortgage dung heap that once was the Australian economy. The Abbott “dung” age, c/o John Howard.

  • 41
    Hamis Hill
    Posted Wednesday, 6 February 2013 at 7:32 pm | Permalink

    Lord of the Fl-ies”, novel that describes the media’s behaviour and the inevitable outcome of conservative leadership?; a dead pilot, in a crashed economy, with the MSM to be saved by adults arriving to the rescue?
    Abbott PM?

  • 42
    Hamis Hill
    Posted Wednesday, 6 February 2013 at 7:34 pm | Permalink

    Lord of the Fl ies” with Abbott as the crashed pilot and the MSM as the lost boys finally saved by the arrival of adults?

  • 43
    Harry Rogers
    Posted Wednesday, 6 February 2013 at 8:44 pm | Permalink

    Good even handed assessment Berbard based on supposition and not much else available out there and I presume the waters will muddy further as the election approaches.

    Frankly I think people will vote on the bais of “least damage”. That usually favours the Liberals which is a shame because the alternative for a thinking voter in the past 10 years is zilch..read no visionary leadership.

  • 44
    drsmithy
    Posted Wednesday, 6 February 2013 at 9:25 pm | Permalink

    drsmithy, it is because we have reached The End of Growth, read Richard Heinberg - it is why business is wary, but government is not, yet!

    You give business far too much credit. Business still thinks we can return to the glory days of yore - look no further than the continual calls to reduce already-low interest rates even more to “stimulate demand”.

    They haven’t a clue.

  • 45
    Jimmy
    Posted Wednesday, 6 February 2013 at 10:12 pm | Permalink

    The Duke, I to would love to have you define Failure, after 5 years of global economic disaster Australia’s economy is continuing to have around trend growth, low inflation, low unemployment, solid real wages growth and low interest rates.

    On top of that this govt has introduced more reforms in 5 years than Howard did in 11 years.

    You are also correct that Costello and Swan are chalk and cheese, Costello paid down debt by selling off every asset he could then wasted the boom times by presiding over the expansion of middle class welfare beyond anything ever seen before, if Costello hd of been half the treasurer he is made out to be either our surpluses would of been much higher or the investment in infrastructure, health and education would of been much higher.

    contrast that with Swans record and you see Swan has been much better.

    A pre emotive question do you think we should of had surpluses in the last 5 years?

  • 46
    Hamis Hill
    Posted Wednesday, 6 February 2013 at 10:29 pm | Permalink

    Labor has done well sitting on top of the mortgage time bomb left behind by Howard and not setting it off.
    Abbott will explode this time bomb.
    Better economic credentials?
    The options are keeping up with the rest of the world and coping the GFC belatedly under Abbott or running ahead of the pack, as Labor has done, till things improve globally.
    The conservatives seem to be fascinated with the fate of their global counterparts and seek to blindly emulate them.
    They are economically contaminated, unclean, insane just like the MSM really. Can they be quarantined somewhere?

  • 47
    Liz45
    Posted Thursday, 7 February 2013 at 12:55 am | Permalink

    @the duke - Of course big business loved Costello. Howard blatantly said that he was ‘there to govern for business’ or words to that effect.

    Tell me, if Howard/Costello hadn’t sold Telstra, Sydney Airport and what else? what sort of a surplus would they have had? In the latest report from the IMF they stated that the Govt who spent irresponsibly and the worst was Howard.

    If I put money in the bank but didn’t feed or clothe my children properly, would I be classed as a spendthrift and a caring and responsible parent? I think not! The Howard years were responsible for a gross lack of spending on infrastructure among other things, The Labor Govt is trying to amend this gross lack or responsibility. What Howard did was buy votes by supporting middle class welfare, at the same time, making the lowest paid/unemployed/pensioners and others pay for their vote buying. There are still millionaires receiving pensions and family benefits? There’s billions of dollars outstanding by wealthy companies who either haven’t paid or haven’t paid enough! Why not go after them?

    I’m not interested in charisma? I don’t want a sexy govt, I want a govt that will invest in the people and pave the way for us all to attain and maintain a decent standard of living, not on the backs of the poor and displaced! I want decent and fair funding to public schools, health and housing, and planning for the future economic viability of our country via technology etc - the NBN for example, of which I’m a huge fan! Bring it on! It will reap benefits for the future, some of which we can’t even envisage at this stage! I think it’s great! The Libs would never do it! Invest in the ‘lower classes’? I think not!

    For all of the christian principles alleged by Howard and Costello, they invaded countries that posed no threat to us, which resulted in the deaths of about 2 million people, and the displacement of many, not to mention those who suffered awful injuries, physical and psychological; they omitted to uphold any responsibility towards aboriginal people, sole parents, low income people and let infrastructure run down to dangerous levels?

    @Mike Flanagan - I agree with you! I know that Leigh Sales conducted a very good interview with Abbott some time ago, but the response of the ABC on radio and TV to the speech by the PM at the Press Gallery has been so blatant in its antagonistic and aggressiveness that I’m fed up with the whole thing already. eg. This is not the longest pre election period ever. That is a nonsense. This was going to be like any other 3rd year of a Govt. - in pre election mode, only this time, due to the hung Parliament more so. The way the ABC is carrying on is driving me nuts already! Greg Hunt carried on about whaling which also had me screaming. He’s insisting on the Gillard Govt ‘doing something’ when his Govt had almost 12 years, and what the hell did they do? The same applies to education, health, infrastructure, telecommunications etc. They did next to zilch in almost 12 years, and now they have the gall to challenge the current Govt!

    The assertion of Julie Bishop and Co yesterday, that the Govt is now in caretaker mode was just too stupid for words, and yet, not one so called journalist pulled them up on it. By the end of the day I was yelling at the radio and TV! The official pre election time when the Govt etc is in caretaker mode is when the House of Reps is dissolved, the Governor General is informed, writs are issued etc. The rest is just spin and bs.

    I urge people to take a look at last Saturday’s cartoon in the SMH - it summed up Abbott’s campaign etc to a T. I’m going to put it on my frig! Excellent analysis!

  • 48
    Harry Rogers
    Posted Thursday, 7 February 2013 at 3:40 pm | Permalink

    Mike F

    Abbott …….is the most unfit potential leader of this nation I have witnessed in fifty odd years of voting”

    Wow Mike I can only remember one that I considered visionary …Keating. Fifty years ..wow no let me take up 3 pages of comments on those on State and federal over the past 20 years.

    Are you seriously saying the current government offers a genuinely inspiring vision. Abbott has no vision but please give the audience some points for intelligence.

  • 49
    Hamis Hill
    Posted Thursday, 7 February 2013 at 4:09 pm | Permalink

    Jana Wendt decried the dumbing down of Australians by her fellow journalists almost two decades ago.(And was sent to Coventry)
    Anyone care to measure the effects of this corruption of this cental democratic institution over that time?
    Anyone care to measure the subsequently enabled corruption, from the inside, of both major political parties over that time?
    Anyone care to measure how this fake left versus right tribalism has been enabled by fake journalism?
    The only actual evidence of zombies involves a first person account from a person drugged into such a state then “revived” by the application of an antidote.
    Certain citizens appear to have been “revived” by alternative “antidotes” to the MSM.
    It follows that those “Dumbed Down” by Jana Wendt’s recalcitrant former MSM colleagues in the last couple of decades are indeed going towards the ballot boxes like Zombies. And the antidote might be losing its effect?
    The antidote, such as Crikey, might be losing its effect?

  • 50
    Mike Flanagan
    Posted Thursday, 7 February 2013 at 4:29 pm | Permalink

    Harry R;
    I most certainly agree with your perception of Keating’s reign.
    I walked tall as an Australian through his tenure.
    The alternative on offer at the moment, in the form of our opposition leader, is really lacking intellect, drive,apart from self ambtion, and leadership qualities.
    I do agree we are poorly served by many of our so called ‘leaders’, past and present, but that seems endemic throughout the democratic world.

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