It has been the legacy of Conservative governments over the past 50 years to deliver underperforming economies to incoming Labor governments while at the same time, flaunting false credentials, refusing to acknowledge their own failings.
How it is, that they have been able to convince the public that they are better economic managers, while systematically undermining the living standards of the average household, is something that requires a good deal of in-depth analysis. But as each week passes, we continue to see their form on display.
Take our current Energy minister, Angus Taylor who argued fiercely on Insiders last Sunday that Australia’s greenhouse gas emissions were coming down.
Notwithstanding that our emissions have increased every year since 2013, the year Tony Abbott, as prime minister, abandoned the carbon tax, Angus Taylor was quite emphatic that they were coming down.
He did so on the strength of a slight reduction in the December Quarter of 2018. Minister for the Environment, Melissa Price made the same observation a few days later. It was classic Liberal spin.
Today, on the release of the December quarter GDP figures which revealed a disappointing 0.2% growth, (annualised at 2.3% but just 0.9% for the second half of last year), our Treasurer, Josh Frydenberg interpreted this as good news, by reminding us that Australia was growing faster than any G7 country, except the US.
By using that twisted logic, he was avoiding the underlying truth. One can interpret a set of numbers any way one likes. But in doing that, Frydenberg ignores the reality that our economy is slowing. Choosing to boast some meaningless international statistic rather than face up to the microeconomic impact of life at home, is more classic Liberal spin. Josh Frydenberg needs be reminded of that, although it’s doubtful he would listen.
The microeconomic impact of today’s GDP numbers is that we are now in a per-capita recession. That means economic growth per person has been in decline now for two successive quarters. That is the real news. The only reason we are not in a full-blown economic recession is because of population growth and government spending.
How ironic is it, that while this government has done its level best to cut back on spending wherever they can, the only reason we are not in recession is because they haven’t cut back far enough?
“Government final consumption expenditure grew 1.8 per cent, with ongoing expenditure in health, aged care and disability services,”Frydenberg said in addressing the GDP result.”
Does he really have any idea what he is saying?
Our economy is retracting, an increase in unemployment is just around the corner, the only thing saving us from a recession is government spending and he is preparing a budget where he intends to spend even less, just so he can produce a surplus!!
What madness is this? The economy is being starved of money, forcing households to draw down on savings while our treasurer is doing his level best to starve us of even more money. By what economic measure can this be a good thing???
Dissecting the numbers released today, we can see that consumer spending is outpacing income growth, which means households are taking on more credit or drawing down on savings, something that cannot be sustained, individually or collectively. But that’s okay, because Josh Frydenberg tells us that our economy is out-performing six of the G7 nations.
It is highly likely that the March 2019 quarter will be negative. But we won’t know that until the first week of June when, in all likelihood, a new Labor government will have only just been installed.
Once again, Labor will have to inject stimulus money to revive a weak economy and suffer the misfortune of an electorate that believes them to be an inferior economic manager. The irony is gobsmacking.
It happened in 2007, in 1983 and in 1972. It seems to validate the claim that Labor governments have to be twice as good as conservative governments, to be judged their equal.
Falling living standards are always the result of fiscal austerity, something for which conservative governments can pride themselves in excelling. This is what Labor will inherit. Once again, they will have to do the same job all over again.
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