Yesterday’s confirmation that the Australian economy had avoided a technical recession sent the Rudd government into a fit of giggles, with a triumphant PM taking to the stage at the ACTU conference last night to revel in his and Wayne Swan’s apparent economic mastery.
Official Australian Bureau of Statistics data reported that the economy grew by 0.4% in the March quarter, built on exports and the stimulus package, with our buoyant national accounts apparently making us the envy of the world.
This morning’s papers, while parroting Rudd’s line in their news sections, were harder to please when it came to the more considered past-time of commentary and analysis.
First off the bat at 12:05pm yesterday was veteran Daily Telegraph political reporter Malcolm Farr who regaled his readers with the awful truth:
Of course we’re in recession if you have lost your job, your super has evaporated or the value of your house has turned into small change. The economy has been walloped and will stay that way for a while yet.
Scott Murdoch at The Oz stuck the following sentences together by 2:29pm, casting doubt on the nation’s fundamentals:
But behind the headlines, the economic sunshine is no where near breaking out. Private business investment shaved off at least 1.1 per cent off economic growth – and it is spending of this nature that will not only safeguard the economy now but prepare the nation for when the recovery eventually returns. It is no good thing that this is being held back now.
Colleague Michael Stutchbury at The Australian, a trenchant critic of Kevin and Wayne’s performance, and renowned economic dry, was set scrambling for traction:
And the repeat dose of cash handouts in March and April could keep headline GDP in the black in one of the next two quarters. So a headline recession may be dodged again, thanks to Henry’s stimulus timing.
But this won’t stop unemployment from rising, which will hit consumer spending. The record net export boost won’t be repeated. And business investment is collapsing
Australia will be battling recession for the rest of the year.
But George Megalogenis was having none of it:
Yesterday happened to be vindication day for phase one of Labor’s response to the global financial crisis.
But it came as a surprise to the public, and indeed many elements of the media.
The pursuit of negativity had blinded the expert and lay commentator alike to the possibility that Australia remained in relatively good shape.
Politicians with unexpected good news are like teenagers who have had some sneaky sex — they can’t help themselves. They look a bit sheepish but can’t hide their grins — and they’re bound to wink and blurt out that they “got some” and then pretend they said nothing of the sort.
Ken Davidson in The Age (the economic times seem to well-suited to his strident Keynesianism), took the opportunity to re-echo his obsession with the General Theory:
Even so, providing the borrowings are used to finance productive activity that yields a return better than the long-term bond rate, there will be no net debt burden on future generations.
The “barbaric relic” of gold still has an inchoate hold over the popular imagination, and this is probably what is giving the Opposition’s unscrupulous and ultimately economically damaging campaign against the “burden of debt” traction in the electorate.
But the last word goes to multi-talented Fairfax stablemate Ross Gittins, whose line was picked up eagerly by Joe Hockey this morning:
My job is to tell it as I see it, not to concoct happy fairy stories, no matter how convenient such deception might be. And the truth is — as every sensible economist will tell you — we are already in recession and have been for some months.