Contrary to their self-promotional material, there seems to be a disturbingly strong nexus between Australian conservative political leaders and poor economic management – a nexus currently being demonstrated by Malcolm Turnbull’s populism and John Hewson simply losing the plot.
The SMH’s Scott Rochfort occasionally runs something he calls the FCLWDI — the Former Conservative Leader Wealth Destruction Index. It’s enough to place a “sell” signal on any board featuring FCLs.
John Hewson is one such FCL — most recently featuring as the departing chairman of the troubled Natural Fuel. Whatever’s proving difficult with the biofuels outfit though is not nearly as strange as what the FCL has been prescribing for the Australian economy: the private sector should slash prices and profits because of the appalling recession that is about to engulf us.
No, seriously, that’s what he’s saying. Heard him on ABC radio on Friday. Nearly ran off the road.
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Dr John is in the doomsday camp and reckons it’s not just up to governments to help us through hard times — the private sector should pitch in. For example, Telstra should cut the cost of its services and Woolworths should reduce prices. I suppose my local coffee shop should reduce the large takeaway to $3 as well.
Yep, what Australia apparently needs is reduced profitability. That will do wonders for share prices and all those worried superannuation fund members. Of course, if we do cop a recession (and I continue to doubt it), John will get his wish — the market mechanism works like that.
Fortunately it doesn’t really matter anymore what John Hewson recommends. With Malcolm Turnbull, it’s a bit different — he still has a role in Australian public life.
The same irresponsible, cheap populism that marked his grandstanding for banks to pass on all the RBA rate cut was on full show in his call for the proposed bank deposit guarantee to be increased from $20,000 to $100,000.
These are meaningless numbers, but the call itself was enough to make people wonder why Turnbull, the former merchant banker, was making it — was there something wrong with our banks? Nothing like spreading a little fear and suspicion if it might help win a vote, even if you’re supposed to be intelligent enough to know it’s B.S.
Rudd’s move to the 100 per cent guarantee yesterday was not about fearful mums and dads and all about access to foreign debt markets — but I wonder if we have to wait long for Malcolm to claim credit.