Mungo MacCallum: Dismal GDP, no jobs or growth and Turnbull's blame game

By | | comments |

In the midst of the worst economic performance since the GFC, Malcolm Turnbull blames everyone but himself, writes Mungo MacCallum.

THE CONSTANT REFRAIN of economists who get it wrong is that we should never rely on just one set of figures.

And so, when the September accounts emerged far worse that even the most pessimistic practitioners of the dismal science predicted, they hastened to assure us that once the entrails of next quarter’s chooks had been assessed, things would be better.

And they’d want to be: the gross GDP collapsed from rising by 0.6 per cent in June to falling by 0.5 just 12 weeks — a drop of over a full percentage point, the worst result since the global financial crisis.

Various excuses were proffered; the weather, the timing of the arrival of some helicopters — and perhaps it was really all Western Australia’s fault. And then there was the election itself, which had apparently engendered uncertainty and confusion rather than the jobs and growth promised. So we have negative growth; now for this week’s news on jobs — or the lack of them.

Malcolm Turnbull managed to ignore the first three months of his narrow escape; this was no more than a bump in the road, he had other things to shuffle aside. But his Treasurer, Scott Morrison, could not avoid comment, which he did initially by blaming Bill Shorten and the Labor Party for everything.

And his own solution? A demand to get behind the Government’s programme, a plea for a partnership with someone (presumably the crossbench) to join him in legislating company tax cuts. Given that Treasury’s own forecasts would add just one per cent, less than the drop in the last quarter, over the next 20 years, this was not the most enticing prospect. But it appears to be the only one he can think of — tear a giant hole in revenue in the hope of a derisory return long after he and his colleagues are snug in their well-funded retirement homes.

So perhaps, fortunately, the caravan moved on, to watch Turnbull in his customary position — denying his own previous promises and convictions, ignoring physics, economics and common sense in yet another futile grovel to assuage the insatiable lunar right of his party room.

In the process, he threw the hapless Josh Frydenberg under a bus, forcing him to perjure himself in supplication for daring to hint what all the experts had told him: that it might be worth considering – only considering, mind – that an emissions intensity fund in the electricity industry would actually provide a cheaper and more reliable method of dealing with the mounting problems of the sector than doing nothing — which is, apparently, the Government’s preferred option.

Even in the right’s own terms, this does not make sense. It is true that the wingnuts have their share of climate denialists, but the unpalatable fact is that the Government, however reluctantly, is forced to do something about the international consensus that global warming cannot be ignored. Turnbull, Frydenberg and even such outliers as Barnaby Joyce have agreed that the Paris accords to limit emissions must be met.

So that being the case, it would surely make sense to do so in the cheapest and least painful way possible — the way all the economists, the environmentalists, the government’s own chief scientist Alan Finkel and even those within the industry concur. But not in the Coalition party rooms. A carbon tax, of course, cannot even be mentioned, as Turnbull trumpets. But nor, the prime minister now insists, can the merest suggestion of emissions trading. This is not rational – it is not even ideology – it is simple bloody-mindedness.

And in the end, it is utterly counterproductive: electricity prices will go up more than they need to and supply will be threatened. And while Australia will probably meet its emission reduction target in 2020, the prospect of making the Paris figure in 2030 is wildly impractical — unless, of course, this Government, and incoming ones, are forced either to spend vast amounts of public money to overfund the manifestly inefficient mechanism of what is misleadingly called “Direct Action”, or more probably to see reason and return to market solutions like emissions trading. Hush my mouth.

And on this matter at least, it appears that our plastic prime minister is implacable. When the premiers met at COAG last week with a plea for a national agenda to end the state-based confusion on climate policy, Turnbull simply reiterated his – or Tony Abbott’s, or Cory Bernardi’s – current policy: no carbon pricing, no emissions trading, no nothing. We will bumble along as usual.

But he has not been entirely idle. Yet another leak tells us that the Government is set to ditch Abbott’s signature Green Army — the bunch of youthful conscripts dragooned into an expensive make-work programme to mask the real extent of youth unemployment. The real GreensRichard di Natale said it was about time — the Green Army was never an environmental initiative, which seems a bit harsh; some trees were planted, some weeds pulled.

But it led to few if any real jobs and will not be missed — any more than the rest of Abbott’s absurd Direct Action plan would be if Turnbull ever had the ticker to pull the plug. Once again, it was a slap at Abbott which no more than enraged the increasingly feisty pretender when what was need was a killer blow.

And the other news on the environment front is that Turnbull is still considering a billion dollar loan to the multinational mogul miner Adani on mate’s rates, although the company has already admitted that it doesn’t really need it in order to dig up a large part of the Queensland landscape and further endanger the great Barrier Reef in the process. Still, it would be a friendly gesture, so why not? The hell with GDP.

In spite of all this Turnbull remains determinedly upbeat: innovation (although not, obviously, on environment policy) is still the key to everything, we must keep on keeping on and, sooner or later, something will come out right. It must, mustn’t it? The law of averages says so — and that is one scientific truth Turnbull is still willing to espouse.

Of course, in the meantime, he risks being exposed as an unprincipled coward, a fraud and a poltroon. But that will be just another poll. And you should never rely on just one set of figures ...

Mungo MacCallum is a veteran journalist who worked for many years in the Canberra Press Gallery. This article was published on John Menadue's blog 'Pearls and Irritations' and is republished with permission.

Turnbull insists government is on track to return the Budget to surplus (source @7NewsMelbourne).

Monthly Donation


Single Donation


Know more! Subscribe to IA for just $5 a month. 

Recent articles by Pearls and Irritations
Australia's school funding system needs an overhaul

Our school funding regime has reached new heights of absurdity and needs urgent ...  
Understanding and reducing the impact of coronavirus: First do no harm

Providing communities with accurate, timely and logical information about corona ...  
Government report reveals a lagging economy

Last Wednesday’s release of the national accounts for the September quarter ...  
Join the conversation
comments powered by Disqus

Support Fearless Journalism

If you got something from this article, please consider making a one-off donation to support fearless journalism.

Single Donation


Support IAIndependent Australia

Subscribe to IA and investigate Australia today.

Close Subscribe Donate