Liberal Summer Games

Well, yesterday turned out to be quite an eventful day for the opposition. Normally these things happen over the summer recess, not when parliament is sitting.

Firstly we had Julie Bishop trying to convince us that it was her decision alone – no input from anyone else – to move from Treasury to Foreign Affairs. Of course, those “carefully planted” stories had nothing to do with it.

Bishop’s move meant that Malcolm needed to re-re-shuffle the opposition front bench. It now transpires that Peter “The incredible sulk” Costello was offered the role of opposition Treasury spokesperson, but again declined, meaning that Joe “I’m so uncle-like” Hockey has accepted the role with Helen Coonan moving to Finance.

Now I would have thought that if you are in public office then you should aspire to the highest positions you can, and to be in a position that you can assist the company. But it appears that Peter still wants to sit on the backbench. Why does he not leave parlaiment and let someone represent his electorate who aspires to be of benefit to the country by using his talent? And yes – I do believe that Costello does have talent and that his scruitiny of the government would be most useful.

And then last night, the former leader Brendan Nelson announced that he will not seek pre-selection at the next federal election. Could he be going for the non-vacant leader of the opposition in the NSW Liberal Party? The position vacated yesterday by Joe Hockey?

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55 Responses

  1. Costello’s not stupid he knows that both Turnbull and Hockey don’t really understand how to approach debate on the the current economic crisis (and let’s face it, it’s as much about trial and error as anything else). Why not wait until they fall over before he then takes a more moderate stance toward Labor’s approach to the crisis and then wait for more obvious mistakes before pouncing.

    Peter Costello says no to Treasury position
    http://www.theaustralian.news.com.au/story/0,25197,25065417-601,00.html
    MALCOLM Turnbull has put the “formidable communicator”, Joe Hockey, at the centre of the Coalition’s political economic attack after Peter Costello refused the job of Treasury spokesman.

    The Opposition Leader spoke to Mr Costello, Australia’s longest-serving treasurer, about the position of Treasury spokesman on Sunday, a day before Julie Bishop stepped aside.

    But Mr Costello, also the longest-serving Liberal Party deputy, had told the Liberal leader in a previous conversation that he would only be interested “in one job” if he were to return to the front bench.

  2. Joe Hockey is a professional idiot. He was distracted when HIH folded. When the APRA mandarin knocked on Joe’s door to apprise him of concerns about a certain insurance company Joe told him he was in the middle of ordering office furniture and other matters would have to wait.

    As for Nelson…he shed a few tears when Turnbull snatched the job off him so it appears he is still hurting. Poor Mr Nelson will now have to face the sordid distress of penury as he struggles through life on an MP’s pension. We might even see him lined up at a soup kitchen as his life becomes more distressed.

  3. Hockey is a salesman; at least, that is what he has been used as since he came into Liberal cabinet. Whenever the Liberal party has an issue selling something distasteful to the public, they shift Hockey into the cabinet role to match. WorkChoices, of course, being the most disgusting example.

    Currently the Liberals have no cut-through message to sell the public in terms of their economic skills. One of their foundational beliefs is in a “free market”, but unfortunately that belief ties them to closely to the cause of our current economic distress. Hockey isn’t being brought in for his economic skills, but for his ability to “market” the Liberal party as economic managers.

    Since his image change from “avuncular nice guy” to “red-faced loud mouth” has turned many people off of Hockey – it’ll be interesting to see what he turns into to sell his current message.

  4. Why do I get the impression Joe’s going to step in some real poo and I’m going to have a great time covering it on Blogocrats?

    Free-market Hockey to go ‘blow-for-blow’ with Rudd
    http://www.theaustralian.news.com.au/story/0,25197,25065402-5013871,00.html
    JOE Hockey’s rise to be the Opposition’s Treasury spokesman will escalate the brewing ideological battle between the Coalition and Kevin Rudd over public regulation of the private sector.

    Opposition sources yesterday described Mr Hockey, 43, as a firm believer in free markets who opposes government intervention in the private sector unless as a last resort.

    He takes on the treasury portfolio as the Prime Minister continues to blame unrestrained capitalism and inadequate regulation for the global economic crisis and to paint the Opposition as being opposed to regulation.

    In an 8000-word essay published last month Mr Rudd blasted the Opposition as neo-liberals while arguing for greater government regulation, especially at an international level.

    With Mr Rudd apparently laying the groundwork for a battle of economic ideologies in next year’s federal election, Liberal MPs said yesterday they expected Mr Hockey to go “blow-for-blow” with Mr Rudd and Wayne Swan on economic theory.

  5. Stephan, on February 17th, 2009 at 8:21 am Said:

    Joe Hockey is a professional idiot. He was distracted when HIH folded. When the APRA mandarin knocked on Joe’s door to apprise him of concerns about a certain insurance company Joe told him he was in the middle of ordering office furniture and other matters would have to wait.”

    Initially I though we were just not going to get along. I apologise, I was wrong.

  6. Be careful John because someone at Blogocrats has looked into my eyes and declared that I am a member of Team Right. That same person couldn’t tell me what my favourite colour was, what type of car I fancied or what I had for breakfast but I suspect that person was a simon-pure analyst.

  7. Stephan

    Hey, whether we agree of disagree it’s all about being good sports (wink) . You’ve posted some pretty interesting comments to date.

    We need diversity and common ground to learn..

  8. And what of Ms Bishop. She is the deputy leader of the rabble and has chosen Foriegn affairs to ensure Australia maintains its reputation on the world stage. She just dosen’t get it, we don’t want to maintain our standing as racist, abusers of human rights, supporters of torture, a deputy dog for a despot President (former) and his arrogant empire. Julie, do the public a favour and follow Brylcream Brendon. As for Hoss Hockey, he has no substanca, and the theme that he is opnly the sales person is absolutely correct. He has tried to sell a dudder to the public (serf choices) and treid to wrap it is pretty paper, but that lost the election for the mongrels. How many dudder policies can he try to sell and maintain credibility. Me thinks that as a salesman one has to get across the item one is trying to sell, with Turdball’s flip flopping everywhere, this aspect is going to be close to impossible. Good luck Hoss, but you’d better watch out for the Costello/Minchin team who will be chipping away at the credibility of the current leadership team.

  9. Did any of you hear Hockey on AM this morning? He was blathering on something about the intergenerational equity report the Howard goverment produced and made absolutely no sense. But before that, he tried to argue that Government debt was bad but only bad when you couldn’t service the debt as that was what had cause the current problem when the private sector over extended itself and defaulted on its loans – well ‘der’ Joe, but why was your Government actively encouraging private debht through it’s actions. And I haven’t heard any economic commentators suggesting that the current proposed Goverment debt (even up to the $200Bn cap) can’t be repaid reasonable quickly (and before it becomes a concern for our kids).

    This piece from Joshua Gans looks at the Lib attacks that the debt will burden our children and is worth a read:
    http://economics.com.au/?p=2584

  10. D55,

    Joshua’s piece was good.

    And maybe the coalition should be hounded for their lack of investment in infrastructure in good times where those that suffer will be our children.

  11. joni

    It now transpires that Peter “The incredible sulk” Costello was offered the role of opposition Treasury spokesperson, but again declined,

    “The incredible sulk” I was thinking just the same thing this morning! (great minds and all that 😉 )

  12. D55

    LOL

    I was going to post along the lines of we need the Incredible Hulk but ended up with Shrek, because the Incredible Sulk is still smarting over the fact the liberals would not let him be team captain.

    And for someone who is allegedly out of his depth, Swan has certainly shown some staying power. Across the despatch box he has faced: Costello, Turnbull, Bishop and now Hockey.

  13. joni

    The other thing about the interview this morning I couldn’t get over was the fact that Hockey was so critical of the stimulus package being focussed on social infrastructure rather than productive infrastructure. The problem for the Libs is that the infrastructure funds and Infrastructure Australia are also investing in big projects. The other propblem is that the social infrastructure is also needed and will still stimulate jobs growth or at least retention (construcing houses and scholls etc)

    The reality is that all of the current infraastructure spending is just highlighting how little the past Government invested in any infrastructure (social or hard) in the past 12 years. In fact, I am pretty sure that if you add it all up, the current Government will probably be spending more on infrastructure in this current term than the past Government did in its entire 4 terms.

  14. Amazing! The Robber Barons retain all the shonky CEO’s and senior management teams that got us into this mess…and…

    …the remaining crew of the Titanic that steered Australia straight into the tsunami (tsunami, what tsunami?) – is still shuffling chairs on the deck…

    …the Captain has gone and the First Officer is still sitting around dribbling nonsense – some sort of post trauma ’cause he wasn’t made Captain last year…

    …Custard would be cut to ribbons if he took on Shadow Treasurer (…a shadow of his former self…boom! boom!) – even Wayne Swan has picked up enough info to make Custards life a misery these days…

    …anyone that thinks Custard is just waiting in the wings is dissillusioned – his day(s) have long gone – the reality is he missed hic chance over TWO years a go…

  15. Dave55

    “But before that, he tried to argue that Government debt was bad but only bad when you couldn’t service the debt as that was what had cause the current problem when the private sector over extended itself and defaulted on its loans – well ‘der’ Joe, but why was your Government actively encouraging private debt through it’s actions. And I haven’t heard any economic commentators suggesting that the current proposed Goverment debt (even up to the $200Bn cap) can’t be repaid reasonable quickly (and before it becomes a concern for our kids).”

    Don’t get me started Dave! You’re spot on, $1 trillion in private debt.

    Why do I get the impression that certain economic editors are going to have a field day with Joe. Take Ross Gittins for example, when he wrote recently:

    …In the past decade the housing boom – including the welter of negative gearing – has seen their total debt double relative to their disposable income from 80 per cent to almost 160 per cent.

    That’s our great vulnerability. If Australia succumbs to the global recession, excessive household borrowing will be the greatest reason.

    You may say, rather, that the root cause of the global crisis is greed and its ultimate transformation into fear. But it’s borrowing that facilitates greed and excessive levels of debt that generate so much fear when boom turns to bust.
    The point is not that all debt is evil. It’s that the ready availability of credit – itself the product of financial deregulation – is a two-edged sword.

    It’s like fire: useful for many purposes, but also dangerous and capable of great destruction.

    That’s hardly a new discovery. But in the heat of our optimism and greed we mere mortals keep forgetting it. Which is why financial markets need to be regulated by older and wiser heads.

    Their job is to protect us from our folly. But with their excessive faith in deregulation and their assumption that we’re all rational, they’ve allowed themselves to believe that all credit is good credit and so let us down badly”

    And in the end, it was the free-market philosophy of the Howard Government that failed us.

  16. John

    Then is another point here which I think most of the economic commentators have missed and it realtes to the Lib’s arguments for tax cuts.

    The argument for tax cuts is that it creates a permanent increase in spending capacity and therfore people can budget for this. What they don’t say out laoud is that the increased spending capacity is to enable larger purchases through the ability to service debt – it has nothing to do with the extra cash ( $10 a week or so) enabling them to buy more stuff on a weekly basis. The argument for tax cuts is therefore flawed from the outset in that it implicitly requires further private debt. It is for this reason that I prefer the cash payments because they allow larger purchasses without generating further debt. And if people put the cash into their savings or use it to pay off debt – so what – that in itself isn’t a bad thing and helps protect those people from economic hardship in the future. Of course there is nothin special about a tax cut that makes the people spend the money either – just like a cash bonus, they can use it to pay of debts and put into their savings. The benefit of a cash payout is that it doesn’t encourage further bedt build-up.

  17. Dave55

    “The argument for tax cuts is that it creates a permanent increase in spending capacity and therfore people can budget for this. What they don’t say out laoud is that the increased spending capacity is to enable larger purchases through the ability to service debt – it has nothing to do with the extra cash ( $10 a week or so) enabling them to buy more stuff on a weekly basis. The argument for tax cuts is therefore flawed from the outset in that it implicitly requires further private debt. It is for this reason that I prefer the cash payments because they allow larger purchasses without generating further debt”

    Spot on Dave!

  18. The Liberal party is in complete disarray.

    I haven’t had this much fun since Howard, Costello and Downer declared to the world that they were a unified team in the lead up to the last election.

    The current charade of a litany of bollocks that they’re trying to pull over the Australian public is the stuff of pure comedy:

    1. Crazy eyes stood down of her own accord

    2. She has the full support of Talcum

    3. Joe Hockey is “the formidable communicator”

    4. Tip is biding his time waiting to accept the leadership when and only when it’s offered up to him on a silver platter.

    Poor Tip. It seems he’s been hanging around Tony Abbott a bit too much these days.

    He’ll be quoting from the bible next. And as for Joe Hockey, he’s way out of his depth with the Finance portfolio..

    A shambles, a complete unadulterated shambles…

  19. joni

    The title of your post just game me an idea – does anyone remember the old computer game – Summer Games – based on the olymopis. We could create a new version with events based around the Liberal Pary. You would choose to be a member of the liberal party and compete in various races.

    Costello would start near the finish line but not move from that position until the leader of the race falls over and even then his movements may not be quick enough to get in front of another competitor in which case he goes still again until that leader stumbles and falls. He occaisionally throws stones and books at the other competitiors although these are almost always aimed at the large group rather than the leader. Stranegly – half of the pack turn and fawn over Costello as they run past.

    Julie Bishop will always run second but changes her shirt several times during the race. Any person controlling this character will find that nothing they do to the joystick has any effect – she is perpetually second even though he stumbles regularly and has at least on foot in her mouth for a lot of the race. Some would query why she is in the race at all although her regular stumbles seem to hold back the race leader.

    Turnbull darts here and there always staying at the front of the pack but it’s never clear why. But like the old ‘Summer Games”, Turnbull’s moves require extensive joystick movements and there is a real possibility that the joystick will break before the end of the race and he will stumble.

    Nelson starts the race well but is prone to retiring mid race after getting overtaken.

    Minchin is always mid race but has his own joystick to manipulate the other runners. A very difficult contestant to control in this game.

    Hockey fills up half of the screen and blubbers along. Joystick with feedback capabilities jiggle when controlling this character. Always towards the front of the pack but it’s not clear whether this is because of talent or simply because he started close to the start and the other contestants can’t get around him. Former race leaders are often squashed by him if the stumble. Hockey is the dangerous hazard of the race that you have to avoid.

    Abbott Very difficult character to control. Likes running back to where he came from and when he is running forward either looks back longingly to the former race leader that fell at the end of the last race or at Costello rather than where the rest of the contestants are running. No longer looks interested in winning the race.

  20. I have a small amount of respect for Nelson. By quitting I think that he is saying Get st*ffed you morons.

    And so we now have an Opposition front bench chokka with lawyers. Surely Andrew Robb would have been a novel choice as at least he has an Honors Degree in Economics. However, the suggestion is that Turnbull doesn’t want anyone on the front bench who knows more than he does…hence the choice of Old Joe.

    Style over substance, that is if you like Joe’s ‘style’. I am with Tolputt re:
    Since his image change from “avuncular nice guy” to “red-faced loud mouth” has turned many people off of Hockey – it’ll be interesting to see what he turns into to sell his current message.

  21. D55

    Good idea, but I refuse on a point of order, Mr Speaker, to play with any of the liberal party members joysticks.

  22. Other contestants:

    Vanstone Remote control via Italian joystick. Keeps the children locked up so they cannot play

    Ruddock Batteries dead.

    Brough Brings in the army to play the game.

  23. And I can imagine, D55, that the Liberals would play on an Atari or ColecoVision and they would marvel at the amazing graphics.

    Internet? Xbox? PS3? What are they?

  24. Found via Crikey: Bernard Keane
    Monday, 16 February 2009 5:22:46 PM
    JamesK I think Abbott wasn’t considered due to some non-political issues he has at the moment.

    Anyone have any ideas?

    I was thinking that Abbott might have been a better foil for Swan. Plus Abbott never dealt himself out of the game as per Costello.

  25. Min,

    I reckon that even Talcum realises that Abbott is just too much of a liability for the party to be given any position of prominence…

  26. Atari or Commodore 64 … or does anyone remember the old ‘microbee’ computers they had at schools?

    Chris Pyne not actually running in the race because the race officials suspected him of being under age. Still forms part of the game’s sound effects though as effimanent ‘”point of order” comments can be heard occaisionally as the contestants compete a lap and pass the finishing line.

  27. reb, on February 17th, 2009 at 10:01 am

    5. Brendan retiring at the next election (we’ll see…)

  28. ” has accepted the role with Helen Coonan moving to Finance.”

    joni, I forgot to put my glasses on & thought you’d written “Coonan moving to France”…I got excited there for a moment. Thought another Howeirdian was bailing out.

    agree w/ John’s views in comment 1 on why Costello is staying put…wily bugger. Costello, not John…:)

    N’

  29. “And what of Ms Bishop. She is the deputy leader of the rabble and has chosen Foriegn affairs to ensure Australia maintains its reputation on the world stage.”

    david, why do I get the feeling Ms Bishop is going to be travelling the world to get dirt on Kevin Rudd & do the tea (and plenty of other liquids) party “tittle tattle” thing…parties attended by the spouses of influential polies & financiers on the Right & media moguls.

    Plenty of insightful comments above.

    Stephen & B.Tolputt, interesting assessment of Joe Hockey…ironically he reminds me of the North American roughnut, blowhard shonky car salesmen who used to bellow at B-grade ice hockey players from the crap seats whilst spilling soft drink and mustard & relish from their hot dogs all over themselves and others…

    real popular guys

    N’

  30. Reb the goss is as per Bernard Keane at Crikey. That Abbott has ‘issues’.

    The reality is that Hockey is 3rd choice.

  31. …I had expected Andrew Robb would take the T seat he waffles enough BS…

  32. Dave55

    Forgot to compliment you on your creative writing, Dave, did you say you’re a civil servant? 😉

  33. TB
    Occaisionly public servants have to write ministerials and press releases so it helps to be creative 😉

  34. Dave55, you could have Abbott run off the track halfway through, get on his bike & race off, peddling furiously along Green bicycle paths.

    N’

  35. Min, on February 17th, 2009 at 12:48 pm Said:

    Reb the goss is as per Bernard Keane at Crikey. That Abbott has ‘issues’.

    The reality is that Hockey is 3rd choice.”

    Here’s a real laugh Min, tried ambushing a DT blog just recently which featured Abbott as the guest blogger. So I posted comments and then sent them in an email to the editors of the DT and SMH. My bet was he wouldn’t even post them let alone answer them, guess who was right.

    Abbot doesn’t have a clue, so he’s in good company with Turnbull and Hockey.

    Dear Editors

    Abbott’s shooting his mouth and this time he says “IF YOU don’t understand economics you’re not qualified to run the economy.” Funny about that I was thinking the very same thing about the Howard Government. Let’s see if he has the courage to post my comments, or respond? Let’s see him blog on things economic!

    We need a dollars and sense economic approach
    http://blogs.news.com.au/dailytelegraph/yoursay/index.php/dailytelegraph/comments/we_need_a_dollars_and_sense_economic_approach/
    Tony Abbott – Thursday, February 12, 09 (01:54 pm)
    Thursday, February 12, 2009 at 01:54pm

    IF YOU don’t understand economics you’re not qualified to run the economy.
    In the past five years, Prime Minister Kevin Rudd has variously described himself as an “old-fashioned Christian socialist”, an “economic conservative” with not a “sliver” of difference from John Howard and, most recently, a “social democrat” who thinks that Howard’s “neo-liberalism” has turned Australia into a “Brutopia”.
    ________________Comments posted below

    “IF YOU don’t understand economics you’re not qualified to run the economy.”

    This is how I’ve expressed similar thoughts previously.

    Weekend talkback Tim Dunlop Friday, June 22, 2007 at 10:22am

    Talking about mediocrity posing as genius, JWH has me worried and more than a little concerned about his true understanding of economic reality. He keeps repeating the same dangerous mantra interest rates are lower and people can borrow more.

    Household debt hits record

    John Howard said the heavier debt burden reflected rising affluence.

    It is the case that people are buying ever more expensive houses, and they are doing that because of a number of factors, the Prime Minister said. One of them is that interest rates are lower and people can borrow more.

    Are more and more people getting sucked into a dangerous debt trap that could lead to financial ruin for many? Lets look at some of the alleged facts and the potential downside, as I see them:

    Debt levels are rising, but we are choosing to use the debt more productively to buy assets that traditionally rise in value, like shares and property.

    However, the Reserve Bank’s figures on household finances show that assets are rising faster than debt. Households now have assets, including housing, superannuation and other investments, that are equal to eight times their annual income.

    This is a capital gain over the past three years equivalent to 60 per cent of a full year’s income.

    It is not only housing debt that is rising. Margin lending to buy shares has soared 40 per cent over the past year to reach $30.2 billion in March.

    Credit card debt rose at its fastest rate in three years, increasing by 8 per cent to just under $40 billion.

    Remember the Commonwealth Bank ˜Equity Mate commercials? Housing prices were booming and the Commonwealth Bank were encouraging everyone to borrow against their growing equity. The message was: take on debt while interest rates are low and your capital gains are BOOMING

    My point, growth in assets measured by capital gains from rising market levels can create an illusion that people are indeed becoming wealthier until at least some of these markets actually correct themselves – which is likely to happen when interest rates increase. Take the recent surge of money being thrown into superannuation funds and the corresponding rise in stock market prices – excess money (sometimes often highly leveraged – refer margin lending) thrown limited markets tends to push price levels to new and unsustainable highs – this no doubt increases asset/equity growth and the belief that money is being used productively – but what happens when the bubble bursts? – as it surely will – Billions of investment gains will magically disappear.

    AND LENDING ON MARGIN TO INVEST IN STOCK MARKETS IS AN HISTORICALLY DANGEROUS THING TO DO – taking on debt in the hope of making a profit in an historically high stock market have brought ruin to many an investor in the past.

    Something to think about, maybe?
    John McPhilbin of NSW
    Fri 22 Jun 07 (11:46am)

    ————-
    Tony
    Does anyone really have the right answers for dealing with this crisis? Is doing something better than doing nothing? I think so, pull out all stops to reduce the impact of the inevitable decline in private sector growth is a good start, in my opinion. I’m just hoping we’re not in a full-blown recession when a package gets passed.
    Take for example the latest figures out of the US:

    The US unemployment rate reached the highest level since 1992 and payrolls tumbled in January, with millions more likely to lose their jobs before a stimulus and emergency-lending programs temper the US economy’s freefall.
    The jobless rate rose to 7.6% from 7.2% in December, the Labor Department said Friday in Washington. Payrolls fell by 598,000, the biggest monthly decline since December 1974. Losses spanned almost all industries, from construction and manufacturing to retailing, trucking, media and finance.
    “We are in the middle of a very severe, a violent, collapse in activity and it could go on for months,” James Galbraith, an economics professor at the University of Texas in Austin, said in an interview with Bloomberg Television. The report will likely diminish objections “that somehow the president’s recovery plan is too large and should be trimmed back.”

    Ross Gittins makes a strong argument for timely action” Stimulus is Three T’s and sympathy”:

    …like most of the economists, I don’t doubt the recession would be a lot worse without the various stimulus packages.
    In preparing this week’s package, the Government has sought to comply with the Three-Ts rule of fiscal stimulus: measures should be timely, targeted and temporary.
    The timely principle says governments should apply their stimulus as early in the downturn as possible. Because things tend to snowball (economists would say multiply) in a downturn – with my cutback in spending reducing your income and thus prompting you to cut back, so reducing my income – the notion is that the earlier you act, the less things unravel. A stitch in time …
    Similarly, the targeted principle says the stimulus should go to those people or on those purposes most likely to get the money spent quickly. This favours governments spending the money themselves so that, at least in the first round of the money’s flow around our circular economy, all the money is spent on consumption or investment.
    This explains the support for spending the stimulus on capital works (now grandly named “infrastructure”). Trouble is, major capital works programs such as expressways, bridges and railways can take years to plan and get approvals for.
    Almost 70 per cent ($29 billion) of the $42 billion is going on capital works projects. But Swan has tried to ensure the money is spent quickly by targeting it towards lots of quite small building projects.
    Half the money is going on repairing and adding new facilities to every school in the country. The rest is going on fixing black spots on the roads, building boom gates at level crossings and building 20,000 new social housing and Defence Force homes, with about $3 billion going on a small business investment incentive.
    All these projects are worth doing in their own right, they should be easy to get going and they should give a boost to employment in the small businesses that dominate the building industry.
    The remaining 30 per cent ($13 billion) is going on cash bonuses – transfer payments – of up to $950 to most taxpayers, parents of school children, single-income families, some students and farmers. Many households will get multiple dollops of $950.
    The way to think of this is as a once-only, lump-sum tax cut. Whereas ordinary tax cuts are doled out at a few dollars a week, this one comes in an upfront lump.
    Another difference is that low- and middle-income families will get a lot more (and high-income families a lot less) than had the tax cuts already planned for July this year and next merely been brought forward.
    Clearly, Swan’s approach scores well on timeliness and reasonably on targeting, although this time the cash bonuses are going to many middle-income families who’ll be more inclined to save them than would poorer people.
    Malcolm Turnbull’s argument that people would be more inclined to spend a “permanent” tax cut than a once-off bonus – based on the economists’ “permanent income hypothesis” – isn’t a strong one empirically.
    Finally, the temporary principle says everything you do must be a once-off (even if spread over a few years) so that it leaves no impediment to getting the budget back into surplus once the economy is well clear of recession. Swan gets full marks on that bit.

    ————
    Tony

    In the ‘All points West’ blog at SMH just a few months ago weeks ago the question raised was: Is Australia’s economic miracle a mirage?

    My answer was simple ‘Mirage!’ and to quote Michael West:

    [quote]”The shape of the world economy has changed in the last 18 years. China has boomed.

    Although Australia’s GDP growth has historically tracked the US, this time we are in a particularly fortunate position of having a mining boom (although commodity prices have begun to come off sharply). And Government debt is not an issue.

    That said, Australia like the US is a current account deficit country (currently 6.2% of GDP) which means our banking system borrows from the rest of the world to support our lavish lifestyle.

    No longer can this country rely on a debt-funded spending spree to fuel a recovery. This is bad news for both the banks [business] and the consumer.”[/quote]

    I know Howard and Costello laid claim to being the masters of the economy and interest rates but that is simply no longer a viable claim, and it never really was. They were simply riding a favourable economic wind.

    They were also front and center when it came to cheering Australian who took advantage of artificially low interest rates by taking on boatloads of debt. Nor did they monitor the lending practices of the financial sector, in spite, in spite of the obvious lending lunacy that was going on.

    Our banks assure us that we are in a stronger position than the US to cope with any fallout, I tend to be more skeptical. Our banks have surely been aided in earning record profits off the back of complex and risky debt arrangements with other lending institutions, businesses, and individuals in recent years? This has been a global issue, not just one relating to the US alone.

    Rewind back over twelve months and I can still hear Howard repeating the same dangerous mantra “interest rates are lower and people can borrow more.”

    Howard said the heavier debt burden reflected rising affluence.

    [quote]”It is the case that people are buying ever more expensive houses, and they are doing that because of a number of factors,” the Prime Minister said. “One of them is that interest rates are lower and people can borrow more.”[/quote]

    Yes, our hero was pushing a dangerous mantra indeed. In his opinion, it seemed as though a new era had arrived under his leadership.

    Mark Davis, author of The Land of Plenty writes:

    [quote]”Australia’s ‘age of prosperity’, as Peter Costello calls it in his memoirs, has been underwritten by the mining boom (even as manufactured exports stagnated during his tenure) and massive increases in household debt (now more than $1 trillion – about the same as the annual national output), even as the government has wound down its own debt. The national debt has in effect been privatised while, at the same time, risk has been shifted away from government and business onto the shoulders of ordinary people, in the shape of long working hours, casualisation, and the sort of uncertainty that is written in the fact that Australians take the least holidays of any western nation.”[/quote]

  36. John

    I think the length of that one is a record 😉

  37. Dave55

    Thanks for noticing (wink). ‘If you can’t dazzle em with brilliance baffle em with bullshit’ is my motto. Imagine being the recipient of those comments? My bet is that Tony panicked and realised he didn’t really have a clue on how to respond.

  38. I used to ‘love’ that one John. Howard’s argument that household debt didn’t matter because your assets are now worth more. Completely overlooking the fact that one needs to have a stable economy, a secure job in order to service the aforementioned debt.

    Just a blast from the past at: http://www.youtube.com/watch?v=xcjLEwZqcQI

  39. Min

    And that is it in a nutshell.

    Lol The Irack

  40. FFS McPhilbin! Did you honestly expect anyone to read that…!!!

  41. Reb What’s FFS mean?

  42. “For Goodness Sake”

  43. I did…hugs MinXXX

  44. John

    You have to learn to paste a small salient section and then post a link.

  45. Joni

    That’s my point, I had no link because Tony refused to post my comments

  46. reb, on February 17th, 2009 at 1:57 pm Said:

    “For Goodness Sake”

    But you said…FFC.. it doesn’t match reb

  47. This is all great fun. The Liberals are worth a good laugh and a half. I’m really looking forward to watching Joe Hockey’s unintended comedy. Should be a real hoot.

    On a serious matter, it’s a shame that the Liberals don’t pick their best team. Ah well, at least there’s a proper opposition in the senate – Greens and Xenophon.

  48. Oh dear, you know this things are bad in the Liberal Party when Dennis Shanahan is kicking them:

    While Turnbull and Costello have had at least three conversations in the past two weeks about Bishop, her job and the front bench, they have not resolved the rivalry between the two nor salved Turnbull’s paranoia. Joe Hockey – now left with the tag of Turnbull’s second choice as Treasury spokesman – is also faced with a mighty challenge to exceed the benchmarks created for Bishop.

  49. I am looking forward to Old Joe trying to look serious when all I have is a visualisation of him as Shrek…with due respect to Shrek.

    At: http://www.youtube.com/watch?v=IQPlUYdC3sI

  50. Joni:

    “You know this are bad…”

    Did you just brang that out of nowhere..?

  51. Wah!!!!!

  52. “Ah well, at least there’s a proper opposition in the senate – Greens and Xenophon.”

    Alastair, you’ve just raised Miranda Devine’s blood pressure. She’ll be furiously typing another BOMB the GREENS opinion piece. During her day of beauty.

    N’

  53. Good stuff John…you were on top of it.

    The pollies have no excuse for not being prepared…the word was out there for those who kept their eyes & ears open…& bothered to cross-reference & surf the web…that the CRUNCH was coming…Peter Costello referred to it as a “tsunami” once the waves were licking his retreating boots. Bit late.

    N’

  54. “John, I think the length of that one is a record”.

    The worry is that it only took him 3 minutes to compose it!

    And my bit on the opposition is simple: they haven’t yet caught on that they’re no longer in government.

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