Swan dive: marked down Sales blows the budget

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Budget night is the night political journalists pretend to understand economics — like Leigh Sales did when interviewing Wayne Swan on ABC 7.30 last night. Managing editor David Donovan reports.

Australian Treasurer Wayne Swan and ABC 7.30's Leigh Sales. (Image: composite of screen shots from ABC 7.30).

THE AUSTRALIAN MEDIA hype budget night like it is going to be more exciting than the Rio Carnival. It always disappoints.

The thing about a budget ‒ any budget – is that it is always going to be extremely dull for the vast majority of people. Things were spiced up a little, of course, when the Howard Government was in power and many avaricious people started watching on budget night to see whether they were going to get juicy little voter bribes from the tax man — that they really didn’t need or even deserve. These days, in austerity times, there's nothing in the budget for most but just a little more screw-tightening pain.

But, with the Government having achieved record low interest rates, low inflation, low unemployment, solid levels of economic growth, and lower levels of government debt than virtually any other advanced nation, what more could we possibly want from them?

Naturally, the corporate media will try to sell the budget as a disaster and an attack on business. The Murdochracy rules and Uncle Rupee, our glorious American overlord, wants to see Julia Gillard gone – yesterday – so that a different leader – one he can “work with” – can take over. Even the Fairfax Press ‒ and even journalists currently being sued by their major shareholder (and significant local ditch-digger) Auntie Gina ‒ have decided to go for the kill by the looks of articles such as Adele Ferguson’s hysterical ‘Budget Tough on Business’.

Of course, budget night is always fairly funny, because it is the time of the year when political journalists pretend they have the faintest understanding of economics, finance and budgeting. As an accountant and finance analyst of a couple of decades standing, I typically watch news reports on budget night with a rapidly changing mixture of annoyance, incredulity and, most often, outright amusement.

The interview between Leigh Sales and Treasurer Wayne Swan was a classic example.

Leigh Sales is an attractive youngish female who always looks like she is slightly put out by having to interview whoever is sitting across from her. She narrows her eyes and looks down her nose and purses her lips and flicks her hair, in a way that seems to suggest: “I am very busy; why are you bothering me?”

I suppose she may have found this to be a pretty good way of getting middle-aged men to feel uncomfortable and blurt out something rather stupid or untoward. It certainly worked for Tony Abbott over the Olympic Dam matter — although, to be fair, he seldom needs much encouragement to gush something idiotic.

The Canberra budget lockdown: where political journalists pretend to understand finance.

Unfortunately, by my reckoning, Sales has next to no understanding of economics or finance. I seem to recall her once doing a column on ABC Online about great books she’d read, and so I am guessing that, perhaps, her primary interest is the arts, not the grubby world of business — and there’s nothing at all wrong with that. However, poor knowledge in the interviewer makes for a shallow interview and maybe ABC 7.30 would have been better advised to pass Swan to a qualified interviewer — perhaps regular finance correspondent Alan Kohler.

I’ve done a few hundred budgets and forecasts in my time for various businesses and organisations, and so I laughed when Sales asked Swan in a staccato rattle whether he could "ever be trusted" to get a forecast right.

“How can we possibly trust you over a ten year period when Treasury couldn’t even get one year right?”

It numbs the mind, somewhat, to think that someone could be so economically illiterate to think “budgets” and “forecasts” will ever be “right”. They are never 100 per cent accurate, being based ‒ you know ‒ on modelling and predicting incredibly sophisticated future events based on the best available evidence at the time. Treasury analysts ‒ who are full-time bureaucrats, not politicians like Wayne Swan ‒ make the forecasts to the best of their ability, but in the real world events happen and things change.

As John Maynard Keynes might have said if questioned in this extraordinary way:

“When the facts change, I change my mind. What do you do, Leigh Sales, build yourself a time machine?”

Worse was to come. In the final unnecessary attack on this extraordinarily successful Treasurer, who guided Australia unscathed through the horrors of the GFC, Sales asked Swan, as she jabbed a pen in his general direction, whether he planned to “contest the election in September”.

Swan said yes, he did.

Then Sales went for the cheap-shot; an impertinent slur that she stuttered and stammered her way through, perhaps fearful it would irrevocably stain her journalistic resume — as maybe it should.

“Do you think you should reconsider that given the … uh… your track record as … ah… treasurer, as Australians may see it, is one of over-promising and under-delivering?”

In other words, Sales asked Australia’s treasurer whether he plans to resign in disgrace because, according to her, just about everyone thinks he’s a terrible treasurer.

Wayne Swan is almost never a confident speaker but, at this final insult, the Euromoney International Finance Minister of the Year glared back at the QUT Journalism School graduate with a steely expression and responded smoothly, stating undeniable facts about his illustrious record as the custodian of Australia’s considerable treasure — facts Sales’ tired old media will fudge and try to spin away in their inexorable urgency to boost an economic illiterate on a Salesian scale to the top job.

This is what Swan said:

Leigh, there’s nothing I’m prouder of than my record as treasurer.

We have an economy which is 13 per cent bigger than it was before the Global Financial Crisis.

We put in place the most successful response to the Global Financial Crisis and the global recession of any developed economy in the world.

We have an unemployment rate — one of the lowest in the world.

We have a big investment pipeline.

We have record low interest rates and we have contained inflation.

I’m really proud of that and I’m proud of what our Government has done over a five-and-a-half year period.

By any measure, this has been a dizzyingly successful period in Australia’s economic history and Wayne Swan has been one of our best ever treasurers. The 2013 Australian Federal budget is a remarkably austere and responsible tightening of spending in an election year, which even includes ditching elements of Howard’s flagrant middle class vote buying — but don’t expect the economic dunces in the establishment media to let that inconvenient cat out of the bag.

These days, Australians expect a budget to include a few tasty bribes — and why would our crumbling relic media try to persuade them otherwise?

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Australia License

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