As I recall, the saying goes something along the lines, “no matter how bad figures are, you can always pretend they look better,” and Joe Hockey has certainly done that with the latest GDP numbers released on Wednesday.
The March quarter growth rate was 0.9% with the year to date, March 2015 result coming in at 2.3%. Both figures are below those needed to bring unemployment down, yet what does Joe say? “These numbers have proven that there are some clowns out there that are talking about recession and dark clouds on the horizon.”
I guess I’m one of those clowns based on my assessment last Monday. Joe went on to admonish we clowns further by saying, “They have been proven to be looking foolish, those people, and we should be focusing on what is before us which is raw data that says the Australian economy is, in the last quarter, one of the fastest growing economies in the developed world. How good is that?”
Well, how good is it really? Yes, it certainly is raw data but what the treasurer should be focusing on, is what the other raw data underneath tells us, because that’s what most economists have been doing and it tells a different story. To begin with, annual growth has been in decline, for the past three years notwithstanding an occasional quarterly spike.
Some of those other economies he is referring to are in the Northern Hemisphere (USA), just emerging from their winter. Of course they would be lower. But, more importantly, our annual growth rate of 2.3% puts us 19th out of the 34 OECD countries. Not much to cheer about there.
But, here’s the deal. Export volumes increased by 5% but the dollar value of those exports fell 12%. Domestic consumption rose by 0.5% but wages growth was only 0.1%. That means we either dipped into our savings or took on debt to pay for it. Business investment fell 0.5% and imports rose 0.6%.
In fact, it was a good thing Joe announced these results on Wednesday rather than the following day when the trade figures for April were released. He would have had to explain the $3.9 billion deficit (imports over exports), which was three times the deficit in March and the worst on record. That will have no small impact on the GDP results in the June quarter.
No doubt the treasurer will be hoping for some lift in business investment in the June quarter following the announcement of a $20,000 tax deduction for tradies. Just how many are rushing out to beat the June 30 deadline for this year’s tax return will be revealed in September.
I wouldn’t be holding my breath. But if they have, their tax bill this year will be considerably less, further impacting on revenues.
For the moment though, Joe Hockey has been given a bit of respite. He’s likely to need it. The next two quarters will likely tell a different story. By then, he will be regretting the day he called those who delve far deeper into GDP results than he does, clowns.
Deviations in quarterly figures can give one a false sense of security.
Joe will do anything to keep his fat salary. Great article
cookbooks and cooked-books
I was on a management commitee for a community center, our treasurer knew something of accounting. Joe Hokey can’t count without using his fingers. Joe Hockey as treasurer just doesn’t add up.
John a great case of cognitive dissonance whereby the buyer waxes lyrical about their inferior purchase and ignores the fact that they have bought a dud. Well Australia certainly bought a dud with this lot yet the polls are still showing the naive hope of many Australians that their choice was the right choice regardless of the disaster before us.
The numbers are in the; economy tanking; the austerity repair in tatters; unemployment high; no growth yet many of our fellow citizens blissfully live in ignorance while inequality increases, unemployment is at unacceptable levels, manufacturing is decimated and the poor further impoverished.
But me rich mates are doing well.
A nation in denial is a nation in the throws of self-inflicted recession and hardship.
Yet cognitive dissonance reigns supreme while Rome burns.
Classic conservative masochism.
The alternative?
Heavens only knows because neither major party have the policy goals in place to attack this disaster front on.
What I reallywant to know is how come the press halfwits just stand around him admiringly as he utters these ludicrous statements … Is there no longer a single reporter who will publicly argue – or even ask a vexing question ?
The idea that the instant asset write-off for small business is going to stimulate the economy and boost employment seems highly unlikely. Harvey Norman and Bing Lee may have to put on a few extra sales assistants for the end-of-financial-year sales but I fail to see how me buying a new coffee machine or upgrading my computers (which I did a few months ago dang it) is going to boost employment in any significant way as pretty much anything I might buy is imported. I certainly won’t be employing any more staff because demand remains low. Small businesses having a bit more money doesn’t mean their customers do.
As John points out, all this will do is decrease government revenue.
Kay the economy requires multi billion dollar infrastructure investment not tidily hand outs to small business. Small business will only get a suitable boost if the economy is growing. As usual these fools play tiddlywinks around the periphery while continuing on with the main game of austerity and an attack on workers wages and conditions.
They have never let go of Work Choices and by using every lying devious strategy possible continue to instigate the IPA goals of cheap labor and destruction of the welfare sector and public utilities. Cynically wind it back for a while to regain popularity then back to the destruction of workers wages and rights.
Abbott is no more than a devious hypocritical liar and the sooner journalist attack the facts the sooner we can get rid of these fools and start attacking the Labor right.
I fear our job will not be done with a change of government.
We need to invest in education and research for the future.
We could be building the NBN and high speed rail which would not only boost employment and productivity but allow for decentralisation and the revitalisation of regional towns which would, in turn, ease the housing affordability crisis.
We should be driving the transformation to renewable energy for the investment it will attract, the employment it will create, and the benefits to health and environment that it will produce.
We should be addressing inequality because that will boost demand. Raise the tax free threshold, increase welfare payments, and watch demand rise and unemployment fall.
We should be increasing the superannuation guarantee so workers will be less dependent on the age pension. Tax breaks for the rich will not help ease that burden as they were never going to receive the age pension anyway. Addressing gender pay inequality would help too with this generation of women more likely to have worked for most of their adult life.
All of their tinkering is so petty, so paltry, so short-term. They have no vision beyond winning elections. Australia needs someone who dares to dream, someone with integrity that we can trust and who is articulate enough to inspire us to follow.
‘A dreamer lives forever, a toiler dies in a day.’ – John Boyle O’Reilly
Joe Hockey, like most, does not realize the consequence of consistent exponential growth. Well, he’s about to find out. The continual pursuit of growth in the face of mounting evidence as to its destructiveness is more than foolish, it is criminally insane.
Not a single person I know believes a word that comes out of that clown’s mouth anyway.
Who is the clown Joe? SACK JOE WOBBLY!! He is nothing more than a lying, toe rag, tea party, flat earth, right wing, conservative, just like the rest of his bloody mob!
Don’t know if this has been linked before: http://www.youtube.com/watch?v=qBpm5sVmGYc