Scomonomics: The Economic Genius of Doing Nothing
The trouble with economics is that nobody really understands all of it because like the cosmos it’s too infinite, so we break it down into simpler bits and use analogies to help explain our point. You’ve undoubtedly heard the expression, “There’s no such thing as a free lunch” which to me has always beg the question, “Does that also apply to other meals or can one find a free breakfast somewhere?”
Naturally, if I were to ask the question someone would tell me that I haven’t understood the basic point that somebody always pays… It’s a fair point, but again it’s not entirely true but it would take me several dozen analogies and then we’d get bogged down into casuistry and semantics before resorting to the sort of abuse that’s normally reserved for climate scientists in an Andrew Bolt column.
Besides, I’ve just thought of a cracker of an analogy to explain the whole Liberal jobs and growth morphing into Scottie’s “We will not be panicked into doing something about sluggish economic growth.”
Yes, Morrison and his Merry Morons are trying to recast Labor’s response to GFC as an overreaction and a panic because after all, Australia didn’t go into recession, so what was all that stimulus about. This is akin to suggesting that the amputation wasn’t necessary because, after it was performed, the gangrene didn’t spread to any other part of the body, but let’s move on.
Consider the drought which, unlike climate change, is generally conceded as something that’s happening. Nobody suggests that the drought is part of a conspiracy by the Bureau of Meteorology. “Bureau” that’s a foreign word which is sus for a start.
Let’s imagine that the GFC is like an earlier drought and let’s imagine that Australia is like a country town and I don’t just mean that in the sense that they should stop listening to Macca on Sunday mornings and get out more. Let’s call this country town “Rupertville” because things should have names and who better to name it after than the local boy who made good. Or made evil, depending on your point of view.
So 2008, there’s been no rain nor any rain forecast. Other towns are resorting to drink seawater but this has sent some of citizens mad and will result in strange elections results in the coming years like Brexit and the election of Donald Trump, but I may be mixing the analogy with the real world and I need to be careful…
Anyway, Mayor Rudd announces that with the likely lack of water, we need to do something to ensure more water. Mayor Rudd ignores all this and announces that the council will be purchasing lots of bottled water and distributing it for free so that, at the very least, nobody will dehydrate. As a further measure, he intends to empty the town’s swimming pool, treat the water and use that to keep some of the crops alive.
Some of his opponents say this is too early and we should wait until people are actually dying of thirst before we give them water, but Rudd and his team persist with their plan and everybody gets through unscathed. (I’m expecting an interruption here from somebody talking about pink batts and people dying but remember this is an analogy and like all Liberal analogies it breaks down pretty quickly when you apply it to the real world.)
So fast forward to the mayoral election of 2013. The local priest is elected on a platform of water for everyone but not government supplied water, water from the sky and rivers like it’s always been. (This is meant to represent jobs and growth and the idea that sooner or later the economy will improve and then the Liberals were going to claim the credit). The local priest and his supporters argue that the free water is in fact one of the things that’s wrong and that they’ll be ensuring that not only will the council stop supplying it, but things will be better if they can just stockpile as much as they can. While their argument about stockpiling water for a rainy day while they’re in the middle of a drought, doesn’t make much sense remember that these people support Friedman’s ideas and that anything remotely Keynesian is sacrilege.
After several years of this policy leading to no improvement in the situation and a couple of leadership changes, the chosen one arrives and he insists that he has the answer to the water problem. “People, the mess-I-are is here. It is I ScoMo and I have stopped the drowinings. Verily, I tell you that we need to stick to our plan of having the council take more water from you than we give back because it is only through the council having a surpus that we shall solve the water problem. We need to sacrifice water to the great gods of industry where it will trickle down from the sky in the form of rain, but this won’t happen if we go wasting it on people who have no water. We must stick to our plan and not panic like Mayor Rudd did, because sooner or later it will rain and that will be thanks to our thoughts and prayers”
And with that the great ScoMo vanished only to be seen running water to the sports team or manifesting himself in Parliament where he’d hold up a relic from his worship of the coal god or explain the wonderful miracle of Angus Taylor’s changing numbers.
Amen.
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Andy56 -
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Return to home pageThe government are doing media drops rejoicing in the surge in housing sales and prices and praising their own economic management for bringing about this bonanza.
They are not as keen to acknowledge that most sales are of existing housing stock to investors who have come back into the market in droves, taking advantage of the low interest rates, the willingness of banks to lend to investors, the market distortion of negative gearing and capital gains tax concessions.
Not a healthy scenario particularly if you are a first home buyer.
yep, it seems a bit like that. I think its more this neoliberal trip their on. Minimal government, you know the market forces will fill the hole. How this ever became a theory, it sounds more like an ideology than anything based on facts. Wow, a government that doesnt believe in facts, what could possibly go wrong?
History shows that a government that invests heavily in its economy, gives it direction, will boom. Once the foot is off the pedal, so to speak, they collapse. Roman empire, Greek empire, Russian empire, persian empire, ottoman empire. And so will come to pass the american you say? No america still heavily invests in its economy, think Military machine. China heavily invests and directs its industries.
Australia does too, to some extent through our obsession with minerals. Although i would say at the expense of every other facit of the economy. And here lays the problem for the neocons, their blind faith in trickle down has hollowed out the economy. Non is so blind as he who cant see what stares them in the face. Add this paranoia about” climate change” and you can see where they are stuck. They painted themselves into a corner, and i say fck you for creating your mess. I have no sympathy for blind faith followers.
Andy, faith of any kind is blind: it refuses to acknowledge the need to think.
Doing nothing does not require ‘genius’ , it merely requires a moronic and uninterested electorate in at least one State of Australia to secure one-third of the seats necessary to attain government, aided by an unethical media. Not hindered in any way by gerrymandering.
We are a secular nation, currently in thrall to a bunch of mendacious bible-bashers which has managed to fabricate a police state in less than a decade without an actual coup.
Ah Rossleigh … nailed it again!! Morriscum & his Merry Morons building the worst foreign owned third world export economy in the OECD for the benefit of shareholders living overseas. But is it treason???
Your penultimate paragraph is eerily reminiscent of the present water supply situation in Armidale NSW where the nat$ controlled Armidale Regional Council is allowing access to the Armidale town drinking water supply from Malpas Dam for growing export tomatoes while the ratepayers struggle to survive on Level 5 Water restrictions.
@Andy56: Government giving direct to the economy is exactly what the foreign corporate invaders DO NOT want. Rather, let us have western land clearances so that foreign owned mining corporations may export coal, CSG and other natural resources without concern for those pesky environmental details. No neighbours means no complaints about anything.
They live on a mantra of small government, low taxes, and less regulation – and hasn’t that worked well for us.
We sell off all our assets, offshore services, reduce financial reporting obligations, get rid of red and green tape so companies have open slather to maximise their profit with no regard for workers rights or environmental protection – and the justification for all this is that if the wealthy get wealthier, they will suddenly find some sort of ethical epiphany that sharing that wealth would be a good idea.
We get rid of public servants who would give unbiased advice and, instead, listen to vested interest lobbyists or pay kazillions to consultants who we can ignore if we don’t like what they say.
We have record company profits and tax reductions accompanied by flat-lining of wages, the rise of job insecurity and underemployment, and record household debt.
What use are low interest rates when you can’t pay rent?
Labor should stick to their plan to restrict negative gearing to new properties with existing investments grandfathered. This would boost construction (and therefore supply) whilst allowing first homebuyers some chance to get into the existing market.
The LNP does not understand how to run a middle-sized social market economy. Its leaders copy the rhetoric from conservatives in the USA and Britain but Australia does not have a big enough financial sector to play the rules which have some merit overseas.
Negative private sector investment figures are very bad indicators for the future.
The LNP will probably achieve its budget surplus for 2019-20 on existing exports of resources and services but all this is not sustainable without fresh investment in the newer economic sectors away from the old housing market.
Thankls Rossleigh for this article.
Alogies are great for standing under reality,
Yours is too esoteric for hansonians and rabbottians because they cannot understand that giving george christ $150000 to spend in the philippines is acceptable but slippers canberra grog trip is a criminal offence, is wrong.
The rannottians and scummos believe in miracle which allows them to stimulate the rich because they have to leak sometime and some will splash down to the economy. The mayor knew to get as much money past the rich and past the state governments was the essential element..
Handtying was the answer and premiers were frustrated but couldn’t untie the mayors knots. Unfortunately the religious schools were quick enough to oil up and slip the ropes from improving existing into building new.
Queensland and NSW were chaffing from the ropes and were less than enthusiastic in supervision.
Australia should be grateful but that was so long ago and their has been a tsunami of lies ever since
ps
waltz for a golfer it is not how but how many for the lnp it is not what is but what it appears.
We might get some satisfaction out of giving the government shitheads a kicking in comments and articles (well deserved), but how do we get the bastards out of our lives?I subscribe to quite a few organisations that are trying to right the ship,but we don’t appear to be making progress anywhere near quickly enough.We can’t rewind the last election, which is turning out to be worse than most of us imagined.What next?
“What next?”
We keep shining a light on every dodgy dealing we can find. It seems Michael West might be having some bother at the moment with articles pertaining to possible links between Angus Taylor and the Hume Coal Project, and a company asked about in QT – GFA F1 Pty Ltd. Both Taylors are known to be quick off the gun with threats. I watch with interest.
We keep printing the truth about economic factors. When Frydenberg says there are a record number of people in work, there are also more people unemployed than when they took over. When he says “pay down labor’s debt”, it must be countered with the debt the Coalition have run up during a period of global recovery. He talks about headwinds – Labor dealt with the GFC. Compare record company profits with record low wage growth. When they talk about wealth creation, point out that over 3 million people live in poverty and they are the ones who have been footing the bill for Frydenberg’s surplus.
We pester politicians. I ring them regularly. I email them. I go on their facebook page, though most of them have banned me. I speak to them in person when the opportunity arises. We can’t wait for an election. we have to show them we are watching them right now.
Sad news, Greedy Smith from Mental as Anything has passed away, due to heart attack.
The Genius of doing nothing !!!!!!!!!!!!!!!!!!!!!!!!!!!!
Scott Horriblesome ,,Has done fark all to lift – Dead start payments !!
Or get rid of- Work for the Mole ……..And,, The Fiberals and the Right wing -Ding bats ,
Wont be happy ,,Until , we are all on- DEAD Start Payments and Work for the Mole !!!
Cause, the way things are going with the drought and economic issues ,! Thats where its all heading !!!
People who have never tasted – work the Mole or Dead start payments , Are in for a rude shock
and out of your comfort zone – and in to the poverty Zone …Yep ..you didnt see it coming !!!
The genius of doing nothing !!! ………………………………………………..
Is poverty – will be as rampant as the current bush fires .spreading out of control .. trickle down fairy tales , have doused nothing ..But their greed disease and their money fever – is in over drive .
which proves a biblical point ..The love of money ,is the root of all evil !!!
The price , the poor pay !! daily !!
The heart of the Neo con’s is there for all to see – ( Scott Horriblesome ..repent , and serve the true master – The Lord Jesus christ and stop serving your right- wing -masters ! –
you cant serve 2 masters !!! ………
( If you want to treat poor people – like Mongrel dogs on the street ! Then you have never known the Christian message !! )
you cant serve 2 masters ! …….
When Morrison is not doing nothing he is just being a complete bastard. eg Medevac repeal.