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So, I Love To Say, “I told you so…”

If you’ve been reading me religiously…

That’s a really funny term when I think about it… Shouldn’t it be “regularly”? After all, doesn’t “religiously” mean without question?

Oh, it’s all ok. I looked it up and it does have the meaning of “with consistent and conscientious regularity”…

Anyway, if you’ve been reading me “with consistent and conscientious regularity”… or religiously… whichever, you’ll know by now that you should never doubt me. Remember when I first predicted a surplus?

No?

Ok, I don’t actually remember either but it was several months ago. And even if we can’t find the first mention, I told you about it a week or so before the Budget and before everyone else jumped on the bandwagon.

This is all just gloating and I guess some people would like me to stop and answer the question:

What’s so good about a surplus?

Which, I will agree, is a good question. A damned, fine question.

Well, it’s like this. We have inflation and during times of inflation anything that sucks money out of the economy is meant to be good at taming inflation…

In theory…

The trouble with Economics is that it’s a bit like Psychology and by that I simply mean that it’s not like Science or Maths… It’s more like English where you can interpret a poem any way you like as long as it’s not the wrong way…

Which, is sort of what I’m saying about Economics…

In order to be an economist you have to agree with all the people setting your exam papers until you’ve earned you’re right to be as wrong as all the other economists…

At this point, I could start talking about the debates between Keynesian followers and the followers of Milton Friedman but that would just be the sort of distraction that leads the one person still reading after two more paragraphs to wonder why there isn’t a “My Budget Rules” or “MasterAccountant” equivalent of those cooking shows. Yes, that person would speculate, they could not only discuss the relative merits of double-entry accounting, but in the special challenge section they could come up with creative ways to cook the books… And the best accountant gets to spend a week at the Cayman Islands where they can meet their perfect match and…

Anyway… Look, I get it.

This Budget has upset a lot of people…

Of course it’s outrageous that people are below the poverty line.

However, politically, there’s no way out with that one. If the government were to adopt the recommendations and raise the rate, we’d have even more screaming about the alleged inflationary effect of the Budget which is the consensus opinion of all those economists apart from those who can be ignored because they’d upset the consensus and the interviewer wouldn’t be able to say that economists are all saying that a Budget surplus is inflationary when any simple textbook would tell you otherwise. (Of course, a deficit isn’t necessarily inflationary, nor is a surplus deflationary; it depends what’s spent where!)

And, politically, we’d have even more people – like Peta Credlin – asserting that we’re giving money to “bludgers” while ordinary people get nothing, as well as people on social media telling us that they have no reason to keep working when they could quit their $100k plus job and live in luxury on unemployment benefits now that the extra $40 a fortnight could enable them to buy a coffee every second day.

But notwithstanding the politics of the thing, I’d have to say that it’s strange that people went from saying before the Budget that it was outrageous that people under 55 weren’t going to get any increase to being even more outraged that it was only about $3 a day. When you say that it only buy a loaf of bread, it’s quite clear that you aren’t the one who can’t afford the loaf of bread!

Ok, it’s true that the increase will be quickly swallowed up by rising prices so stop yelling at ME! I’m not the one who chose the amount and I’m certainly not going to complain about rising taxes if they introduce a rate closer to the poverty line, or better yet a Universal Basic Income, eliminating the need for all time and money checking up to see that people are really miserable while being unemployed and if they’re not, what can we do about it?

Listening to the budget reply from Peter Dutton, I did have the strange experience of thinking that’s a good idea when he spoke about allowing the unemployed to earn more before they lost any payment. I can see several pluses to this idea, but the strangeness of the experience quickly disappeared when he explained that this was INSTEAD of the $40 increase. Yep, you can get even more, you lucky soul, by working ten hours or so hours a fortnight. All you need to do is find an employer who wants you for a small amount of time and if you can do that it’s all fine but if you can’t, you don’t deserve any increase and we’ve saved the taxpayers enough to have an even BIGGER surplus.

Of course, as we all understand from listening to the Coalition over the past few days: A surplus is no big deal. Anyone could have done it. It’s like being a football coach…

You know, come Monday there are heaps of people who know exactly what the coach did wrong and if they were in the same position they’d have an undefeated record. Unfortunately, for Pete and Angus, they were in the same position and they didn’t produce the winning formula, so maybe Bazza telling you what Michael Voss did wrong has more credibility.

 

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22 comments

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  1. RomeoCharlie

    You just rejected a comment because I put a number in my name line. Since when has that not been allowed?

    And I’ve lost my comment which I felt quite good about

  2. Michael Taylor

    Can’t see the comment anywhere, RC.

    It certainly wasn’t rejected.

    Try this:

    If you remember what the comment was, type in only a few words, then press “Post Comment”. As soon as it goes through jump in and edit the comment, ie, finish typing it and press update.

    That should work.

  3. Lyndal

    Something has changed. I am not able to use king1394 any more either, as it rejects the number.

  4. Michael Taylor

    Lyndal, sounds to me like (given you’re not the first today) that there’s been a hacking attempt.

    After every security breach our firewall goes to default settings (which are very tight) until the threat is over.

    Later today I’ll go into the account of our security system and see if I can add king1394 to the “white list” so that the system recognises you as one of the good people. Hopefully it’ll work. I’ll do it for RomeoCharles as well.

  5. Michael Taylor

    Lyndal, in the meantime give it another try. Just post a little bit of the comment without the number in your name, and if it publishes you can edit the comment by adding the numbers to your name. And if that works, edit the comment again by adding the rest of your comment.

    It’s messy, but at this stage it’s the best I can come up with.

  6. New England Cocky

    Oh Rossleigh, I am overwhelmed by your perceptive interrogation of the religiosity of national economics as practiced by the untrained political commentators that haunt the air-waves much too loudly and for far too long. Naturally Credlin is a bludger wanting to keep all the talented alternative commentators away from her too generous and undeserved salary income from the Merdocrity.

    However, I am equally amazed about your concerns that it is only the people living in poverty who are rejecting the LABeral neoliberalism and would much prefer the Universal Basic Income trialled with great success in Canada before the last conservative government shut down the on-going study.

    Do not despair and be of good cheer because the LABerals are going to insure that the undeserving wealthy, including all the state & feral pollies, will receive unmerited tax relief thanks to Scummo of the Seven Secret Ministries and his good mate the coxswain for the Henley Rowing Club gg david hurley of the leadership scam. Time for the Australian Republic having an Australian Head of State and an unaligned political stance in world politics.

    Now how much did the COALition gift to News Ltd for sympathetic editorial coverage before each of the past three elections? THAT must have cost the Budget surplus …..

  7. andyfiftysix

    A UBI is what we provide for politicians when they retire, forget about the fancy name we call it to disguise its true intentions.The rest of us are the great unwashed. If we got it, can you imagine the inflationary effects, lol. Time to call a spade a spade.

    “I hate to say i told you so……” the Hives.

    Yes economics is what ever somebody defines as. The great money balance ideology. Its only solution is that everything must grow at the same rate. Its a mantra that neocons proclaim in the interests of small government. Meanwhile billions in subsidies are willy nilly handed out to favourite sectors, ie fossil fuels. Putting all your eggs in this basket was a real genius hit was it not? The three great gas fields have sucked our economy dry in ways we are just finding out. By handing out money during covid, they proved once and for all that creating poverty is a balancing act.

    Economics discussions are all about the balance, never mind the needs of people. Its all about preserving the jungle so we dont strip it bare. You know, the jungle is everything, agricultural revolution? Nah , we only need a couple of small plots. ( definition of insanity is repeating mistakes hoping things turn out differently. Just ask Kodak and Nokia how that went).

    I am not saying economics is easy, what i am saying is that if you look at things without understanding what your looking at or you misunderstand its context, you are bound to come up short.
    Thank god technology is coming to our rescue. The ever advancing solar industry is ripping through our malaise at such speed that the libs are no longer able to hold back the tide. Proving for ever more that They are such great visionaries. I wonder how much Tony Seba charges to provide some vision.

    Dutton’s one great idea of letting people on welfare earn more before they get scalped is brilliant. Not giving the great unwashed more than $2.85/day is a real nasty sting in a labor tail.

  8. Michael Taylor

    Lindal, just tried it: you can post your comment under Lindal and after it’s published edit it to king1394.

  9. Geoff Andrews

    Economics has been described as the dismal “science” (my quotes) and so it seems to be if the current situation is anything to go by.
    In science, a number of differing theories may be proposed but eventually one will prove to be correct and becomes a law.
    In economics, there are at least three theories, of which none seems to be fool proof – the current “if we pull the interest rate hike lever, inflation will fall” appearing to be an example.
    Of course, as a self confessed economics sceptic, I am probably being unfair and another two years of interest hikes will see low inflation and high interest rates just in time for Labor to get chucked out because they are poor economic managers.

  10. 2353NM

    When I did an economics subject some years ago – the lecturer came bounding into the room at the start of the first lecture and welcomed us to Economics. He then went on to say that if you put 100 economists in a room and give them a problem, they will give you a solution. Then when the solution is proved wrong, they will give you 150 good economic reasons why the solution didn’t work. This was his proof that economics is NOT a science.

  11. Michael Taylor

    Give economists credit where it’s due, 2353. After all, they’ve successfully predicted 17 of the last two recessions. 😁

  12. andyfiftysix

    Geoff, i propose that economics has no theories that are any good. There are no magic formulas that will give you repeatability. Nothing works in a linear fashion. A lot is based on assumed human behaviour. I describe economics as we currently view the subject as trying to put a square peg in a round hole.
    Most people are inclined to do the right thing yet we are lead by economics that appeals to our base values. The future is “gas” was a classic fucked idea by the liberals. What the hell was that an appeal to? We need to reduce emissions so gas is the answer? From an economic perspective it makes weird sense, from a humanitarian perspective its totally fucked. So that branch of economics says lets rape the universe to achieve growth that most people wont see .
    Economics is used as a tool to control us. Makes you scared to leave that well paying secure job in case you cant get another one. A half a million dollar mortgage guarantees you will be a slave to the system for 30yrs plus.
    Yet in essense, economics is pretty simple. You want something you pay for it. Exchange value. Scale gives you benefits in that unit prices decrease the greater the scale. Unless you run a government, in which case economists say government services are no good because they are inefficient. Fuck me, yea right. Supply and demand works a treat when you have a distributed supply and a balancing demand. That goes totally against anything we have experienced in the last 30yrs or will ever experience into the future. Technology is rampaging into the future yet we still think in 18th century ideology. Capitalism is consolidating at a frantic pace, the cost of entry is forever increasing. The rewards for those at the top far outstrip what the rest of us can collect. Yet economics as we experience everyday has no answers because we keep looking into the same box for answers. And the box is empty.
    Like the RBA we talk as if they only have one “lever” to help regulate the economy. I call out the bullshit. they can tighten money supply as well as keep interest rates down. There is no nuance in their actions and as a result, they havent met targets for more than 20yrs. These are supposedly our top experts. You have to call them out as perfectly insane.
    Lets start by understanding what it is we want from an economy then we can have policies that work towards those aspirations. Too many times politicians have made ideological policies and sell them as aspirations. The unknown agenda policy i call it.

    Lets create a whole new industry, call it super. Lets tell everyone its about securing an adequate salary in retirement. But we got to make sure we get our hands on some of that pot. Dont ever dare mention its a 10% tax on peoples earnings. Why do anything insane like increase the pension, it goes against everything we teach in economics.

    the quickest way from a to b is always a straight line, but economics always manages to put an alphabet in between

  13. Terence Mills

    I once had a conversation with and agricultural economist working with the Australian Wheat Board. This was at a time when world grain prices had plummeted following a global oversupply, particularly wheat.

    There were also significant areas of starvation in drought ravaged areas of Africa – as there are now.

    My suggestion was that we utilise the UN to take the oversupply off the market and distribute this to the starving people in Africa, thus stabilising and increasing returns to growers and helping to alleviate starvation.

    He thought my suggestion was simplistic and lacking in economic rigour – I still wonder why !

  14. Rossleigh

    On the contrary, ALL economic theories are good… It’s just the reality that needs to be ignored so that a particular economist can argue that his or her theory holds true apart from all the exceptions where unexpected events meant that it was contradicted by what actually happened.
    Just like when a successful punter explains that the horse he backed should have won but the jockey didn’t get it to the front at the right time…

  15. New England Cocky

    @ Rossleigh: Heaven forbid Rossleigh, you are starting to sound like a COALition politician bemoaning the loss in the 2022 feral election because ”too many people voted for the Albanese LABOR government”.

  16. Michael Taylor

    Rossleigh, your fame spreads.

    I found this on Facebook:

  17. John Haly

    Yes, it was on FB and I used it 😁 Thanks!

  18. Michael Taylor

    I suspected it might have been you, John.

    It’s brilliant. 😀

  19. B Sullivan

    Rossleigh, “After all, doesn’t “religiously” mean without question?”

    Once again, may I point this out.

    It means that your faith or whatever it is you believe does not allow you to question that faith or belief. The word contains a reference to bonds, which are called ligios in Latin and appears to be constructed with the intent of conveying a meaning of restriction, lack of freedom, confinement, bondage. Without question. Denial of the freedom to doubt.

    It makes sense doesn’t it? If we were more familiar with the origins of our language perhaps we wouldn’t religiously defend the principal of ‘freedom of religion’ which is like saying ‘the freedom of slavery’. No problem with the right of the freedom of association with a religion. If you freely want to be bound as a prisoner or as a slave, to a god or the bigotry of ignorance of your choice, that is indisputably your right (but be prepared to take responsibility for the consequences). However, we really shouldn’t suggest that religion is itself a freedom any more than we regard slavery, detentention, and imprisonment as freedoms.

  20. leefe

    I’ve come far too late to a fascinating little conversation here, but there’s one thing I have to say …

    andyfiftysix, your essay was marvellous, and I agree withh everything you say until the very end: ” … the quickest way from a to b is always a straight line.”
    No. You obviously have never been bushwalking, and even more so off-track, in Tassie. The shortest way from A to B is a straight line, but when that straight line involves scrub, cliffs and inconveniently large bodies of water, trying to go straight is definitely not quicker than the old dodge and weave. Not that that necessarily has any great relevance to economics or budgets …

  21. andyfiftysix

    Terence , i can answer that why. Its some inbuilt mechanism that has no logic to it. Its a Nobody should get a free ride ideology. Some latent protestant self harming notion about idol hands mixed with politics of envy. ” You want to give it away for nothing……..no way Jose………” Because the alternative is against the ” principle”.
    You can write a book about fucked logic and inhumane BS in the name of economics.
    This whole BS about teaching people to fish instead of handouts has to be called out. In what way has technology help this cause? In what way can it be a path forward? It hasnt worked too well so far. Another brainwave that has attained high mantra status. Another on the way is ” you just have to work hard and your dreams will come true”. At no time in history has this been true for most people and i would say, technology is an insurance policy on that.

    Leefe, yes exceptions to the rule, lol. But the reason you go bushwalking is the joy of the challenge. Economics isnt really full of cliff faces and rivers between A and B. I know i keep harping about super, but its the perfect example of what i say. A better income in retirement is now a forest of alphaberts when the short route was to increase the pension. I can find countless other examples but this one stands out. We are constantly reminded that capitalism is the efficient use of capital. Bah humbug.

  22. Lyndal

    Andy56, I truly hate that fishing analogy. It smacks of the elitist blindness that is typical of those who have power over the income of others. Teach someone to fish? Are you going to give him the gear, transport to a fishing spot, suitable and plentiful fish in clean water, permission to fish there, refrigeration, cooking lessons … maybe an ocean-going boat as well.

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