An exceptional level of punishment. A just published academic study of the political consequences of financial crises perhaps should make Prime Minister Julia Gillard feel a bit better about the current predicament of her government. It’s probably not her fault. Not that the work by Jeffrey Chwieroth, reader in international political economy in the Department of International Relations at the London School of Economics, and Andrew Walter, professor of international relations in the School of Social and Political Sciences, University of Melbourne, predicts a likely late rally of electoral support. Rather, the evidence from the effects of banking crises over the past century the pair looked at show that crises have a dramatic impact on the survival prospects of governments everywhere.
“History and politics matter. Citizens have become both much more demanding of governments and more prospectively oriented since 1945. Governments perceived as unable to respond effectively to mitigate the consequences of crises for income, employment and wealth are by far the most likely to suffer political punishment.
“A number of paradoxes arise from our analysis:
- First, rising societal expectations regarding crisis prevention and mitigation have more than cancelled out the political benefits accruing to incumbent governments that might have followed from the diffusion of improved macroeconomic and financial stabilisation policy techniques.
- Second, as expectations of post-crisis mitigation have diffused and become entrenched, governments seen as unable to respond effectively are likely to suffer exceptional levels of punishment.
- Third, no doubt governments have responded to these expectational constraints by attempting to deflect blame to others, by trying to reshape the institutional and policy environment in which they govern, and by trying to lower societal expectations about the possibilities of government stabilisation policy.
“But the evidence suggests that great expectations persist regardless of formal policy constraints or attempts to shift blame.
- Finally, great expectations may themselves be destabilising;”
Tony should be pleased. The critical response from many in the business community to his industrial relations policy is just what Opposition Leader Tony Abbott will have wanted. It makes him appear right in the middle of what is a difficult policy area for a Liberal leader.
The political constant. During my almost 50 years in Canberra writing about politics there has been one continually unresolved issue: the site of a second airport for Sydney. In election after election Labor and Liberals dance around the subject calculating which potential location would cause them the least electoral damage and their opponent the most.
It is a truly wonderful game and I am pleased to see that Federal Transport Minister Anthony Albanese is keeping it going with another magnificent non-decision that involves further inquiries. As the Sydney Morning Herald reports this morning:
A study Albanese is releasing today suggests it would take 17 years to buy a site, prepare it, and build the airport. And that, apparently, is after a decision is actually made. I confidently predict that I will see out the rest of my years without a major airline landing in Sydney anywhere other than at Mascot.
Hoping it’s right. In my browsing to find items for my News and Views (below) there was one item this morning that I hope turns out to be right. From WIRED comes an article Why e-mail newsletters won’t die, with the welcome prediction in these times of journalistic redundancies that “if something is important to you, e-mail products are the one reliable way to make sure you’ll see it”.
News and views noted along the way.
- Why the world is reading Gillard’s defence paper [partial paywall]
- Pakistan elections: five reasons the vote is unpredictable
- Samoans await the return of the tasty turkey tail — “This is the tale of turkey tail — its convoluted arrival, disappearance and highly anticipated return to the Pacific island the Republic of Samoa.”
- Mobiles ‘to outnumber people next year’, says UN agency — “The International Telecoms Union predicts that subscriptions will pass seven billion early in 2014. There are currently 6.8 billion mobile subscriptions and 7.1 billion people.”
- Amid security worries, student visas come under new scrutiny – “Since the Boston Marathon bombings three weeks ago, the U.S. government has enacted just one significant security change: It has ordered increased scrutiny of international students coming into the country.”
- Greek youth unemployment hits 64 per cent — “Greek youth unemployment shot to a record 64 per cent in February, underscoring the dire state of the recession-hit economy despite signs of improving business sentiment.”
- The Economist explains — why is youth unemployment so high?