“All models are wrong, but some are useful.”

George E. P. Box

Scotty Morrison’s recent analogy got me thinking about analogies.

I mean, for years we’ve been told that running the government is like running a household. You can’t keep putting things on the credit card, because you’re paying excessively high rates of interest, so that means you should never borrow anything and pay cash for your house. Or something like that. Mind you, governments borrow at much lower rates of interest, the ever-mentioned credit card is itself an analogy!

Well, after years of trying to get my head around which household has several million unrelated people in it, plus companies that come in, use our stuff and then leave without offering anything in return, I discover that there’s more to government than just staying at home doing nothing.

Government – according to our Treasurer – is also like a drive with the family. The driver doesn’t want anyone asking annoying questions like “Where are we going?” or “How will we get there?” or “How did Tony get out of the boot and what’s he doing on the bonnet of the car?”

Analogies are good for explaining things, but they break down if you try to examine them in more detail. As I said to my wife, “Think of me like Brad Pitt.” Of course, when she asked why, I explained that I was taking a leaf out of the Liberals book and just using an analogy, but she insisted on pointing out that Brad Pitt was good looking and wealthy at which point the analogy broke down as did I.

So, if the Liberals want to use an analogy that’s fine, but it’s no substitute for an actual explanation. If I want to suggest that you think of the economy as giant flesh-eating spider with wings, then I’ll probably be asked in what way. When I suggest that it’s scary and we don’t want it to get out of control, then the analogy still makes sense. Even suggesting clipping its wings can make sense, if I’m talking about unrestrained growth.

However, when I make the mistake of thinking of the economy as an actual giant spider and don’t move back into the real world, then I can hardly be surprised if people with arachnophobia refuse to participate in the workforce. Similarly, I shouldn’t keep talking about spiders and at some point, I have to explain how this translates into the real world.

To return to the Liberal idea of the household budget, it’s one of those things that sounds good, but bears about as much relationship to an actual economic policy as my mythical eight-legged creature. Even in terms of their own analogy, there are times when a household should go into debt. Gaining qualifications that enable one to get a well-paying job is an obvious example. Buying the house may be another. And, if the Liberals get it through the Senate, paying for one’s pathology bills.

But the one thing that they constantly ignore in their use of the idea of “living within your means” is that all government expenditure leads to some return in the form of revenue for the government. It may not cover it all straight away, but if you create opportunities for people to work or train, it eventually adds to the tax base. Similarly, if you cut these opportunities then eventually you restrict your revenue in the future.

Think of it like a car, you need to put a certain amount of petrol in, or you won’t make it to the next petrol station, so it’s not a matter of saying petrol’s too expensive this year unless you plan to stop driving altogether and become one of Joe’s poor people. (There’s one that’s almost simple enough for the Liberals.)

(Relax! Competition will mean that pathology companies don’t put their prices up and adding 5% to the GST won’t lead to higher prices either and Santa will bring all the presents this year, so you needn’t buy any!)

For a party that’s slashing so much out of the Arts, they seem great at using metaphors and analogies instead of actually talking about policies. And when you add in all that fiction about what good economic managers they are, it’s a wonder that they don’t see the value of the Arts.

Just in case you haven’t noticed what the Liberals have done to the Arts because you’ve been distracted by what they’re doing with bulk-billing, I’ve included this short video from the Arts Party.