AFR fudges figures to foment anti-Albanese fervour

The mainstream media is ramping up efforts to malign the Albanese Labor Government unfairly, as Alan Austin reports.

*Also listen to the audio version of this article on Spotify HERE.

THE COALITION PARTIES and their spruikers in the major media networks are struggling to find fault with the reformist Albanese Government’s economic management. So, halfway through its first term, they are resorting to dodgy narratives.

A colourful graph published by the Australian Financial Review (AFR) on 9 November purports to show the Albanese Government is the worst in the developed world in maintaining income levels.

Here is the unretouched graph showing the change in real household disposable income per person between June 2022 and June 2023.

Clearly, Australia has the worst outcome. Boo! Hiss! Sack the scoundrels!

Albanese Government pilloried

The accompanying text made several emphatic points. First that Australia’s income decline was the worst ‘of any advanced economy’.

The headline declared: ‘Australia records biggest income decline in the developed world’. Then it claimed: ‘Australian household incomes slumped 5.1%, the sharpest fall recorded across the OECD’.

The second message was that this terrible situation is the fault of the current administration:

‘The figures underscore the political challenge facing the Albanese Government.’

Neither of these assertions are valid.

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The destructive flow-on

The AFR is part of the Nine Entertainment media organisation, whose chairman is former Liberal Party Federal Treasurer, Peter Costello.

Founded in 1951, the AFR has a substantial circulation, estimated at 3.7 million last year, and significant influence nationwide. It is frequently quoted by others, including many with even lower standards of integrity.

The UK-based Daily Mail copied this “story” under the headline:

‘Australia records biggest income decline in the developed world during Anthony Albanese's prime ministership.’

Economics writer Roger Montgomery went further, heading his rehash of the AFR article:

‘Australia leads the world in the annual pace of disposable income decline.’

The economics website Macrobusiness headed its corrupted version:

‘It’s offical (sic). Jim Chalmers is the world’s worst treasurer.’

Their article claimed that 'the AFR noted OECD data condemning Treasurer Chalmers to the moniker of World’s Worst Treasurer’. Macrobusiness followed this with another version of the AFR’s attack titled ‘Australian households suffer world’s biggest income collapse’.

Error one: Worst outcome in the developed world

The AFR’s problems are logic rather than arithmetic. The source document – the Organisation for Economic Cooperation and Development (OECD)’s household data dashboard – shows real household disposable income per person to June 2023 for only 21 countries. That’s out of 66 very high-development nations, according to UNDP classification, or 38 wealthy members of the OECD. So being the worst of either of these is quite a failure.

Finding Australia ranked last in this group, the AFR claimed Australia recorded the ‘biggest income decline in the developed world’.

No, it didn’t. Australia was last only among that small sample of 21, not among the 66. Nor the 38.

Many of the 17 missing OECD countries almost certainly had much worse declines than Australia’s. We can be pretty sure of this because of the impact on real incomes of inflation, which in Australia was 6.0% over the year to June.

Inflation was 7.9% in Latvia, 8.9% in Iceland, 9.0% in Lithuania, 9.2% in Estonia, 9.7% in the Czech Republic, 10.9% in Slovakia, 12.13% in Colombia and 38.2% in Turkey. So the decline would likely have been much worse in most or all of those OECD member countries.

Error two: Blaming the wrong culprits

The AFR identified the causes of declining disposable incomes as inflation, higher interest rates, income tax bracket creep and population growth.

It did not clarify, however, that inflation is a global phenomenon nor that the unjust tax system and an economy in poor fiscal condition were both recently inherited from the hapless Coalition. It chose instead to quote Opposition finance spokeswoman Jane Hume, blaming ‘Labor’s lack of a plan in this crisis’.

In a moment of truth, the AFR stated:

‘Disposable incomes surged at the onset of the pandemic as the Morrison Government unleashed $429 billion in fiscal stimulus, which experts have since found dramatically overcompensated households for the losses experienced due to COVID-19.’

What it didn’t acknowledge, however, is that the apparent steep decline in Australia’s income index was largely attributable to the starting point, June 2022, being artificially high due to the previous regime’s incompetence.

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Coalition-news media negative feedback loop

The AFR emphasised the seriousness of its exposé by reporting:

‘The Opposition hammered Labor over the figures during Senate question time on Thursday, accusing the Albanese Government of overseeing falling living standards.’

When we checked the Senate Hansard for Thursday 9 November, we found the Opposition was not referencing the recent OECD analysis. The craven Coalition was simply quoting that morning’s AFR.

This is the pattern: the anti-Labor mainstream media publish cherry-picked data that the malicious Opposition liars misquote to attack the Government, which generates more headlines about Labor’s failures.

Response from the AFR

IA queried the author of the AFR “story” about his methodology.

He replied:

‘The OECD provided journalists with a spreadsheet on 6 November containing household income data for 21 economies up to June 2023... It is unclear how the analysis was meant to include economies where no current data were recorded by the OECD.’

The obvious reply to this is if you only have data for 21 out of the 66 UNDP very high-development nations or the 38 OECD countries, then you cannot assert Australia is the “worst in the developed world”, the claim made several times by the AFR and countless times in mendacious copy-cat publications.

Recent history in Australia, Britain and the USA suggests that as the next federal election looms, the mainstream media will increase its output of distortions, exaggerations and fabrications. Such is Australia’s doom.

*This article is also available on audio here: