The top ten troubles with Taylor’s tenets

Many of the claims made by Liberal Party Leader Angus Taylor are debunked by clear evidence, as Alan Austin reports.

“Australia is in an economic crisis. This might not be immediately obvious – as in prior economic crises like the GFC and pandemic. But the crisis is unmistakable when you consider our living standards.”

That was the opening to a recent highly problematic speech to the Sydney Institute by the man who hopes to be Australia’s next prime minister. Setting the tone for what followed, that was the direct opposite of the truth.

1. Australia is not in a crisis

Since Labor's first Budget took effect in June 2023, headline inflation has been 9.6%. The minimum wage has jumped 23.7% over that period and the Australian Bureau of Statistics (ABS) wage price index is 11.7% higher. The age pension is up 13.3%, jobless benefits 16.7% and Commonwealth rent assistance 39.4%.

The Coalition’s cost-of-living crisis ended in 2023.

2. Living standards are rising impressively

Taylor claimed:

“At a time when living standards should be rising, they’ve fallen catastrophically — worse than anywhere in the developed world.”

The surge in living standards since mid-2023 has been among the world’s strongest.

Average Australians now enjoy more overseas trips than ever, a record percentage of students now attend fee-paying schools, spending on luxuries is at an all-time high, and home loans are at an unprecedented $2,603.7 billion.

Sales of light aircraft, recreational boats, electric cars and powerful portable tablets are at fresh highs, as are enrolments in riding schools and ownership of expensive exotic pets.

Yes, some folks are still experiencing hardship, certainly. But living standards for the majority have never been higher.

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3. Real wages are not declining

Taylor claimed:

“Real wages are down almost 3%... real disposable incomes are down almost 5%.”

Real wages declined between June 2021 and June 2023, but have risen since then. The lower the income level, the stronger the real wage increases.

4. Economic growth is back among the leaders

“In each of the last two financial years, Australia recorded its slowest economic growth outside of recession on record.”

This is false on several levels.

First, the last two financial years actually were global recessions. When Australia recorded its annual GDP growth rate of 0.89% in June 2024, the UK, Ireland, Finland, Israel and Latvia had just emerged from a full recession. Germany, Austria, Hungary, Luxembourg, New Zealand, Norway, Iceland and Estonia were either still in one or about to be.

Taylor probably did not know this because Australia’s craven media refused to report it.

The Fiscal Monitor from the International Monetary Fund (IMF) ranked economic growth for 30 advanced economies in April. It assessed Australia’s GDP growth to be 2% this year, ranking equal seventh among that group. That’s up from 22nd in 2021 under the Coalition.

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5. Spending has not increased irresponsibly

“In just two years, Anthony Albanese grew government to its largest in 40 years, outside the pandemic.”

Not true. Spending to GDP under this Government is below that of the Hawke-Keating Government in 1984-85, when it was also fixing years of Coalition incompetence.

According to the IMF’s Fiscal Monitor, Australia’s state and federal spending is 39.1% of GDP this year, ranking fifth in the group of 30, much better than ninth in 2019 (pre-COVID) under the Coalition.

6. Debt has actually decreased

Taylor complained that Labor:

“... raises taxes on Australians today. Meanwhile, debt gets bigger for Australians tomorrow.”

Net debt in May was $537.4 billion, lower than the $541 billion level in April 2022, before Labor took office.

Both net and gross debt have declined steeply under Labor relative to GDP.

7. Productivity hasn’t collapsed

“As inflation raged as the pandemic came to an end, productivity collapsed across sectors of the economy.”

The ABS productivity index first crumpled in 2017, long before Labor took office. But real productivity wasn’t declining. The problem, as demonstrated at last August’s Economic Roundtable, was that the old formula no longer works.

This is advanced applied economics, however, so it may be beyond Angus Taylor.

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8. Labor has boosted wealth creation

“This is a government that believes in wealth redistribution — not wealth creation.”

Pure foolish nonsense. According to this month’s UBS Global Wealth Report, the wealth of the average Aussie adult increased 19.3% over the last year to USD$616,306 (AU$882,400), among the world’s highest.

9. The Coalition’s criminal failure through the pandemic

“Faced with the greatest economic shock since the Great Depression, the Coalition intervened to save businesses and jobs.”

The 2020 COVID recession was not the worst shock. It was short and sharp, and recovery was swift.

The Global Financial Crisis (GFC), in contrast, was deep and lasting. Many advanced economies still haven’t restored their pre-GFC job levels, including Denmark, Norway, Sweden, Spain and Italy.

Several OECD countries escaped recession altogether during the pandemic. Under the Coalition, Australia suffered disastrously, with three negative quarters of annual GDP growth, soaring inflation and widespread job losses. This caused the Coalition’s prolonged crisis in living costs.

The most destructive outcome was the wanton, wasteful spending of borrowed money, which utterly failed to avert recession. Gross debt blew out from $530.6 billion to a staggering $828.7 billion under Morrison, Frydenberg and Taylor. This will cost billions in wasted interest payments for decades to come.

10. The Coalition’s record shows it cannot manage

“Only the Coalition has the strong plan... to save Australia. We’ve done it before. We will do it again.”

Actual outcomes confirm the worst period for economic management was 2016 to 2022 under Scott Morrison. The second worst was the Fraser Government from 1975 to 1983. The third was the Abbott Government from 2013 to 2015.

It is a profound pity Australia’s newsrooms refuse to report events accurately and thereby encourage shonky politicians to rewrite history.

Alan Austin is an Independent Australia columnist and freelance journalist. You can follow him on Twitter @alanaustin001 and Bluesky @alanaustin.bsky.social.