Australia’s economic growth is at a 30-year low relative to comparable countries, yet the Treasurer claims it is now a world leader. Alan Austin reports.
LAST WEEK’S economic growth figures confirm three realities the Morrison Government desperately wants concealed.
First, that economic outcomes are far below where they should be given global conditions and the relatively well-controlled pandemic, except in NSW.
Second, that the Morrison Government is clearly the worst at economic management in Australia’s post-war history. Treasurer Josh Frydenberg has achieved the poorest outcomes of any post-war treasurer.
Third, that Australia’s craven mainstream media continue to treat citizens with contempt by reporting these appalling outcomes deceptively – if at all – and refusing to expose the Government’s blatant lies.
Economic growth relative to comparable countries
Quarterly growth of Gross Domestic Product (GDP) for this year’s June quarter was 0.67%, as shown by the Australian Bureau of Statistics (ABS) last Wednesday.
That ranks a miserable 31st among the 34 developed OECD member countries which have reported their second quarter growth so far.
Australia may well slide further when the other four OECD members – New Zealand, Greece, Luxembourg and Costa Rica – announce their second quarter results shortly.
Annual GDP growth – the increase over a full year – was 9.60%, which ranks 24th in the same group.
This ranking is close to the lowest on record, according to data from the World Bank and Trading Economics going back to 1960. Growth was sluggish through the 1960s, '70s and '80s, but accelerated after the reforms of the late 1980s and early 1990s.
After fluctuating fortunes through the Howard years, the incoming Rudd Government lifted growth dramatically. By mid 2008, Australia ranked ninth and by the third quarter an impressive sixth.
Then came the Global Financial Crisis which, as all independent observers have affirmed, Australia handled better than any other nation. Australia then topped the OECD in 2009 on GDP annual growth and remained in the top ten for most of Labor’s term.
After the 2013 election, the Coalition presided over an inexorable decline. Annual growth ranking fell to 14th in 2016, then 18th in 2019 and 20th in 2020.
At 24th, it is now at the lowest since the 1980s.
Frydenberg’s blatant falsehoods
Treasurer Josh Frydenberg immediately tried to hoodwink the nation about this shameful outcome. Within hours of the ABS release, he sent a devious email with a decidedly dodgy graph to his email list.
Frydenberg claimed:
'Real GDP grew by 0.7% in the June quarter, to be 9.6% higher through the year – the strongest year of GDP growth on record.'
This is highly deceptive. GDP annual growth of 9.6% would be commendable in a normal period of steady growth. But this isn’t normal. Australia has had 11 quarters of dismal outcomes, beginning in 2018, well before the pandemic.
Australia’s annual GDP growth in the June quarter of 2019 – months before COVID – was a miserable 1.65%, the lowest June outcome since 2003. Three disastrous annual GDP declines were recorded in 2020, including negative 6.20% in June and negative 3.65% in September, the two worst collapses on record.
The economy is now simply recovering those horrendous losses. The Treasurer has nothing whatsoever to brag about.
Frydenberg’s misleading chart
Frydenberg also said:
'Australia’s economy is now 1.6% above its pre-pandemic level. Our recovery is continuing to lead the pack ahead of any major advanced economy.'
Yes, he claimed Australia is “continuing to lead the pack”. That assertion, illustrated with the chart, below, is shamelessly, blatantly false.
The chart is suspect in several respects. First, it chooses as the starting point the fourth quarter of 2019, which was extremely poor for Australia. So growth thereafter will look artificially strong.
The normal measure economists examine is annual growth.
Second, for comparison the Treasurer has cherry-picked the seven G7 countries which have very little in common with Australia. They are not regional neighbours, nor principal trading partners, nor similar in population or anything else. All have been hit far worse by the pandemic. France, the UK, the USA and Italy have deaths per million above 1,700. Australia’s is 39.
Several OECD countries fared much better than Australia’s very ordinary 1.6% growth over that arbitrary 18-month period. Frydenberg has simply omitted them.
Israel, Chile and Lithuania grew by more than 2.0%. Estonia and Turkey grew by more than 6.0%. Ireland grew by more than 20%. Other comparable countries outside the OECD also beat Australia handsomely, including Taiwan, Hong Kong, China, Romania and Serbia.
Australia is nowhere near the leaders.
Conclusions
It has already been documented that Australia’s pre-pandemic retail slump was the worst on record; wage rises are at an all-time low; budget deficits are the deepest on record; the government debt blow-out is the greatest since World War II; and the collapse in manufacturing is Australia’s most severe ever.
This Government is almost certainly the worst at economic management Australia has ever had, and arguably the worst in the OECD today.
Where it is a world leader, with the help of the spineless mainstream economics reporters, is in deceiving the population. Such is Australia’s doom.
Alan Austin’s defamation matter is nearly over. You can read the latest update here and contribute to the crowd-funding here. Alan Austin is an Independent Australia columnist and freelance journalist. You can follow him on Twitter @alanaustin001.
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