It’s been a long while since an Opposition looked as irrelevant and out of touch as this mob.

It’s hugely disappointing for those of us who thought Malcolm Turnbull represented a chance to secure the few good things from the Howard years and couple them with compassion, smart conservative policy and politics and an intelligence all-too-rarely seen in Australian politics. Not to be.

Instead the Coalition, despite supporting the idea of a stimulus package with a strong emphasis on infrastructure, has dealt itself out of the economic debate and straight into Kevin Rudd’s caricature of them as mindless ideologues. In comparison, the Greens, Steve Fielding and even stuntmaster Nick Xenophon look the height of rationality. The Coalition is now offside with its own business constituency, with voters and with nearly every economist on the planet.

Turnbull is clinging desperately to the argument that tax cuts are better than handouts. It’s an argument that gets more discredited by the day as evidence comes in on the effect of the first stimulus package. More to the point, as a reason for threatening to block a critical stimulus package, such an arcane point of disputation between economists is ridiculous.

Yesterday Turnbull claimed he had Warwick McKibbin and Henry Ergas on his side, both “leading economists”. McKibbin might be a leading economist, but he doesn’t believe there’s a crisis, so presumably doesn’t even agree with Turnbull on the need for a smaller stimulus package.

And Ergas’s status as a “distinguished economist” might come as a surprise to Justice Goldberg of the Australian Competition Tribunal, who in 2005 found that Ergas’s evidence on behalf of Qantas “left much to be desired and lacked clarity, detail and transparency” and that Ergas along with another witness:

…appeared reluctant to respond to questions whose answers might have been adverse to the case put by the party calling them.

Instead, they provided non-responsive answers and deviated to discussions of other issues which supported the case of the applicants … On some occasions, the presiding member asked the experts whether they could answer the question put to them and asked them not to give a long explanation, but to no avail.

Such an attitude and conduct of an expert witness leads to a conclusion of partiality and an inability to express an objective expert opinion upon which reliance can be placed.

Despite, or perhaps because of this, Ergas is a Coalition favourite, and, while claiming to Crikey he was not in the pay of the Liberal Party, was in Malcolm Turnbull’s words “commissioned” by them to conduct their tax review. Ergas conceivably might be working for free for the Liberals — he gave free advice to Richard Alston in the latter’s stoush with the ABC over its Iraq war coverage. In fact he might be better off standing for Liberal preselection and trying to get into Parliament. He’d certainly make a better Shadow Treasurer than Julie Bishop, whose performance of late has been abysmal.

Yesterday she inexplicably claimed both that the Australian labour market was strong and there was no need for another stimulus package, and that the Government’s first stimulus package hadn’t worked. It’s hard to work out how both could be true. Being Malcolm Turnbull’s shadow Treasurer is probably one of the worst gigs in politics, but serious thought has to be given to replacing Bishop. Despite his pretensions, Joe Hockey lacks the gravitas to carry off the role. And while the idea of Peter Costello doing the job is endlessly amusing, that really only leaves Andrew Robb.

There seems to be a general unwillingness in the mainstream media to admit the obvious here: the Opposition’s handling of the stimulus package has been an absolute disaster from the get-go. A self-inflicted disaster, wholly unnecessary, and made worse by each piece of economic data that has arrived to bolster the Government’s case. The Coalition leadership needs a major rethink of how it is handling the economic crisis.

Peter Fray

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Peter Fray
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