Did you know that, according to an official Swiss-based think tank, Australia is the world’s 14th most competitive economy? Oh, hang on, according to an official Switzerland-based think tank, we’re the world’s 18th most competitive economy — just behind Germany. Wait, Germany is actually the third most competitive economy, coming ahead of Switzerland and Japan. No, sorry, Japan is the world’s 30th most competitive economy, not fifth. The United Arab Emirates is the fifth most competitive economy. Ah, pardon me, the UAE is in fact 27th.
Welcome back to the idiot world of neoliberal think tanks and their competitiveness indices. This morning, media outlets around the world and in Australia are unveiling the embargoed findings of the Switzerland-based IMD World Competitiveness Centre’s 2019 World Competitiveness Ranking. That’s not to be confused with the Switzerland-based World Economic Forum’s more widely reported Global Competitiveness Report for 2018, most recently released last October.
“Australia climbs one spot in IMD global economic league table,” the Herald Sun declared triumphantly this morning (another ScoMo miracle!).
“Singapore inches out US for top spot,” Business Insider Australia breathlessly reported.
IMD’s report is based on the same methodology as WEF’s: ask a few business executives (6000 worldwide in the case of IMD) about what they think is wrong with the business environment of various countries, then dress that up as an objective assessment. As Crikey has pointed out repeatedly, the “methodology” is garbage and has all the rigour of an online poll. That’s why the UK is eighth in one report and 23rd in the other, tax haven Ireland is 23rd in one and seventh in the other, Qatar is 10th in one and 30th in the other.
And because the index is driven by the attitudes of business people sitting in airport lounges and business-class cabins around the world rather than facts, it produces wildly variable results. Between 2016 and 2017 in the IMD list, Australia fell 10 places in “business efficiency” for no obvious reason. We’ve moved from 28th on “economic performance” to 14th now, despite wage stagnation and rotten GDP growth. Of course, we’re not the Brits, who went from 45th to 22nd on economic performance in one year.
New Zealand has shuttled between 13th and 28th on “business efficiency”. On “government efficiency”, the UAE is second overall; Qatar is fifth (as we’ve noted before, these think tanks idolise the Gulf state theocracies). But look at them on a more rigorous index, Transparency International’s long-running corruption perceptions index: UAE is 30th in the world (where first is good and last is bad) in terms of corruption and Qatar 33rd. Maybe business efficiency includes being able to get things done with bribes.
Literally no journalist writing up this stuff last night or this morning will point out the idiocy and inconsistency of these indices. They’ll all pretend that this is to be taken seriously, and that somehow Australia and every other country improved or reduced its competitiveness in some measurable way. Nor will the Committee for the Economic Development of Australia (CEDA), which is spruiking the index today, note how ridiculous it is. Once a place of common sense on economic policy, CEDA these days is increasingly neoliberal in its prescriptions for Australia, and used the report to demand cuts to corporate tax. “Australia needs to release this handbrake on business investment,” CEDA CEO Melinda Cilento demanded.
Such asinine comments illustrate how, though it’s good for a laugh to note the absurdities of these reports, there’s something very serious going on. These reports are not objective pieces of analysis but neoliberal propaganda designed to legitimise and encourage the agenda of large corporations to cut taxes, stymie action on tax evasion and cut back environmental and industrial relations protections. There’s a reason the Gulf theocracies tend to do well in these things — because they rely on slave labour imported from Asian countries, which is the preferred industrial relations model of pure neoliberalism — open borders, no workplace protections or decent wages for workers.
They are also a way for business and their handmaidens in government to skate over the real issues confronting market-based economies at the moment — weak inflation, weak wage growth, ageing populations, weak consumption, lazy or lacklustre business investment and the desire of the business class to reward themselves at the expense of the community and their employees. Why do these outfits like CEDA think right-wing populism is on the rise? Because so many ordinary people feel they are being ignored or left behind by the business and government elites who take seriously the garbage peddled by the likes of IMD.