A nation desperate for economic truth

Some sense today from Adam Creighton and David Uren:

AUSTRALIANS are enduring a deep-seated pessimism from a loss of confidence in social and economic institutions at the same time as growing fears of joblessness undermine the government’s economic sales pitch.

As the government embarks on a campaign to boost confidence ahead of Christmas, both economic and social commentators are highlighting the continuing anxiety about the outlook that is holding consumers back.

…Although there has been no blowout in unemployment, the steady job reductions as ­companies cut costs have fuelled job insecurity, which has reached levels normally associated with ­recessions.

The waning of the resources boom in Queensland and Western Australia is starting to cause the sort of anxieties witnessed in the manufacturing states of South Australia and Victoria, where the closure of Holden, Ford and Toyota have become symbolic of the decline of traditional industries. Across the nation, voters are waking up to the realities of a ­slowing, patchy and unpredictable economy.

…Joe Hockey said yesterday that he wanted Australians to have confidence in the future because household consumption was one of the most important drivers of economic growth. “We want Australians to go out there and spend for Christmas. Don’t let Santa down, go out there and spend for Christmas,” the Treasurer said.

…“No matter what the politicians say, the evidence people see in their day-to-day lives contradicts it,” said David Chalke, a long-term follower of social trends and consultant at Quantum Market ­Research.

Exactly. As the Government turns to cheerleading retail, Joe Hockey looks more and more like Wayne Swan by the day. This “positive rhetoric” will, if anything, cause a disappointing Christmas to get worse. I spent three years bashing the former Treasurer for this foolish rhetoric and can only repeat the rationale now.

If your world is coloured black and someone keeps telling you that it’s white, you won’t change your mind about it, you’ll dismiss the idiot that can’t see straight. If they keep doing it you’ll get angry.

That’s where the polity is right now, angry, and desperate to hear the truth from their leaders that their eyes see clearly all around: that mining boom is over, that the housing boom is over, and that the period ahead is about pulling together in mutual sacrifice and taking on the world through hard yakka.

It can be a positive message of national renewal and the first polly to figure that out will rule for a decade.

David Llewellyn-Smith
Latest posts by David Llewellyn-Smith (see all)

Comments

  1. interested partyMEMBER

    “desperate to hear the truth”

    LOL………..we can’t handle the truth…….

      • interested partyMEMBER

        Granted on the mining boom, but neg on the housing. That truth still has a way to go before it becomes truthy enough for mainstream.

      • We will vote out immediately anyone anywhere who decides to give us the truth. We want our goodies and our lifestyle and woe-be-tide anyone who wants to take away anything that is our right!

      • “We will vote out immediately anyone anywhere who decides to give us the truth. ”

        We’d avoid electing them in the first place. But I still wish that someone would bloody try!

      • The Howard era turned us into a nation of “relaxed and comfortable” = greedy, short sighted fools. .
        Since then we have been electing even more short sighted fools to lead us.
        The national ethos seems to be; “How can I get ahead by the quickest means possible, pay the least amount of tax possible and use the system to my benefit.

    • I agree, that is exactly the problem, the population facing up to the reality of over consumption.WW

      • Supply side economics… Santa for the polity… and massive fortunes for the anointed ones.

        Skippy… it would not rub the wrong way so much, if’n the wealth did not translate – supersede votes or end up a big information arb.

    • The jury is still out for me on this one. Are the voters madly rushing from one party to another because they want change, or because they want parties to magically deliver the good times again (as they promise).

      • interested partyMEMBER

        We seem to be intellectually lazy as a nation and have looked for a national narrative that tells us all is ok, the future is good, keep calm and carry on. What we have had is a captive gov covering lobbyists deals with shallow rhetoric and that has left the polity floundering…because we are intellectually lazy…..

      • The jury is still out for me on this one. Are the voters madly rushing from one party to another because they want change, or because they want parties to magically deliver the good times again (as they promise).

        Bearing in mind that only a relatively small proportion of voters (10-15%) are actually doing this, and they seem to be abandoning that tactic in favour of minor and microparties, and independents.

        Personally, I’d say the ~20% of the population who don’t vote along party lines are looking for alternatives.

      • Its a good point Smit, the electoral wipe-out of the Labor party in Qld was on the back of a relatively small (10-15%?) swing.

        And now that polling is back – absurd.

      • interested partyMEMBER

        fella’s

        I reckon we are in for high electoral volatility as far as the eye can see…….the new normal.
        Well……at least until either we get this country sorted out or we go down in flames…

      • “because we are intellectually lazy…..”

        Yeah true, but we also have property and financial “experts”, economists, the RBA, politicians, and the media all feeding the lie that the past boom was situation normal and what we’re going through now is an aberration.

        There were only a few fridge dwellers that argued, and continue to argue, that it was the strength of the past economic boom that was the real aberration! Because the public listens mostly to the mainstream voices they are easily manipulated into thinking a change of government can made a difference.

      • I think IP is absolutely correct – look forward to a lot of one term governments! Also look forward to a sustained period where the country is totally ungovernable. The move to minor parties is not a vote for seeking truth. it’s a vote for the fact that the majors are not giving us enough and we want more to satisfy our own selfish interests.

      • “it’s a vote for the fact that the majors are not giving us enough and we want more to satisfy our own selfish interests.”

        Could it not be for precisely the opposite reason? That we’re searching for something less selfish?

      • AB I’m sure there is a few such as you with that reasoning. However I think (FWTW) is a minority. Just for mine I see a lot of voting for minorities, such as Greens, as being done by people who see themselves, for one reason or another, above thharsh realities of life or living in a dreamland that we will never face harsh realities.
        So what we get is strident shouting about causes that everyone else will pay or suffer for.

      • interested partyMEMBER

        I think the polity are looking/hoping for someone they can trust. However, with the advent of social media, it seems to be the situation where any up and coming candidate showing potential is targeted and torn to pieces by the establishment…..for self preservation purposes. Any threat to a vested interest will not be tolerated and this is the exact behaviour that guarantees our downfall, economically, politically, environmentally, socially, and culturally.
        We are not seen as votes…….we are pay-cheques to one vested interest or another, and we are out of cash and credit. This cannot end well…..no matter what side of politics is controlling the racket.

        We do seem to be accelerating though.

      • The move to minor parties is not a vote for seeking truth. it’s a vote for the fact that the majors are not giving us enough and we want more to satisfy our own selfish interests.

        Does not compute. Voting for minor parties isn’t going to help anyone satisfy their selfish interests, because only the major parties can deliver on those.

  2. Yer actual truth is that Commonwealth deficit spending (measured by the published increase in borrowings) is running at about $5 billion/month, or 3.8% of GDP. That is, fiscal stimulus more than exceeds annual output growth and yet is still not enough to prevent unemployment rising or reverse the income recession.

    There are very powerful deflationary, contractionary forces acting on the economy. Households know it. Businesses know it.

    But political play-acting prevents this from being publicly recognised. No-one with official responsibility for the economy is willing to go on the record on our circumstances. This was a serious problem in the last couple of years of the Labor government. It’s an even bigger problem now.

    • interested partyMEMBER

      “There are very powerful deflationary, contractionary forces acting on the economy. Households know it. Businesses know it.”

      globally…..and not likely to change for many years.

      • Indeed. It will get much worse, I predict 😯

        But people like “Sir Joh” Hockey, who scorn tender processes, will be the last to tell us that

    • I would tend to disagree with the statement that “Households know it. Businesses know it”

      Everyone I speak to and discuss what is coming greats my information with hostility and disbelief. If the Australian public was really aware of the shit this country is in thanks to successive failures for both liberal and labour governments spending would dry up over night and crash us through that sentiment alone.

  3. Wait until the population (following generations) actually start to wake up and see the extent of the national asset sales that have helped fuel the political lies.

    The productive economy has been hollowed out, we have sold off great swathes of land (more than the size of Victoria), we have sold our mining industry and now we are actually selling off our housing. All the while running a population ponzi to juice GDP and construction, and actually lowering the per capita standard of living. Our real debt, private debt, is running at about two and a half trillion and growing.

    From the greatest ToT this country has ever seen, we haven’t actually saved a bean, with many economists recommending those with savings hold them outside the country.

    It’s probably not something our political turncoats would like people to realise in a huge downtown and income collapse.

    The failure of political leadership has been epic.

  4. From my very limited samples Average Joe Aussie is not at all pessimistic matter of fact they’re still drinking one last round to celebrate the out performance of their IP’s.

    I’d suggest wrt the long term economic narrative they can see storms approaching but they’re just hoping the confidence fairy has grown some love handles so they can easily grab hold of her without getting up from the couch.

      • Agree with CB also – they’re all out there getting their coffees at the coffe shops, laying down rubber onn roads, buying their modern SUV’s and getting their ffoot on the real estate ladder. That is the FACT of where we are at.
        There is not even a murmur of concern on any media. Have a look at macrobusiness – the champion of bulls..t is Bill Evans! Yet he’s quoted here as some srot o bloody guru!!!!
        What the hell chance has good sense got?

      • +many Flawse. Here’s my response on another forum yesterday when someone was warning of 100,000 electricity customers in SA being behind in paying electricity bills;

        ‘Those 100K electricity customers live in the new normal, like the finance books tell you – pay yourself first. Which means Iphones, daily coffees, investment property portfolios, annual Bali holidays, new cars, jetskis, tennis for the kids, private schools, Kumons etc. Low rates are a curse in that they don’t take out the trash. People will only get their priorities straight once they are forced to by hard times. Sounds cruel but that’s how economies reset and flourish. Not paying bills on time these days is a strategy not a canary in the coal mine.’

      • “Not paying bills on time these days is a strategy not a canary in the coal mine.’”

        Geez Jimbo – That’s a piece of Gold!

  5. “… Don’t let Santa down…”
    There’s our problem in a few sad words. Those who make the decisions on behalf of all of us still believe in Santa…
    There is no Santa, Joe. Grown-ups know that. They know that someone has to pay for the presents magiced-up and placed under the children’s tree. What was it you ( or was it Amanda Vanstone?) were saying about who was going to be on the Government benches this term?!

    • interested partyMEMBER

      kinda make you cringe, having the nations treasurer talk like that……..lets you know what he really thinks of the average bloke on the street.

      Bit like abbott with his ‘goodies and baddies’ moment.

    • Reminds me of Dubbya telling Murkans to “Go shopping”.

      Which is not surprising. 1TT and his gang are very similar to the Bush mob

  6. migtronixMEMBER

    I see, lowering rates to blow property to more extreme unaffordability is how we pull together.

    …. desperate for economic truth…. yes….

    • And that’s it mig, lowering rates = asset speculation. There is no more complexity to this equation. It’s not lowering rates = business investment + asset speculation + etc, it just gives destructive asset speculation.

      The cloud of haze that hangs over monetary policy is fueled by the FIREs that never lose on the equation.

    • “see, lowering rates to blow property to more extreme unaffordability is how we pull together.”

      And the banks/dealers will be right facilitating it. Hell, I have a small number of shares, small income, yet under my portfolio the site advertises the fact that I can borrow 70k against my shares to buy more!! What the hell! I wouldn’t lend me $20, let alone 70k!

  7. GunnamattaMEMBER

    Thats it,

    Australians are standing in front of a nicely polished 1995 model commodore with all the fittings and about 350 thousand on the clock. It has $25000 on the windscreen.

    They have their politicians, treasury officials and central bankers telling them it is a 2014 model commodore with 3000 on the clock.

    They’ve asked about the smoke the engine seems to blow, they’ve been told the smoke reflects more power.

    They’ve asked about the tread on the tyres, and traction it gets on the road, they are told the tread stays low forever – and its all the rage overseas.

    They ask about its service history and get told it had tax cuts every 3 years.

    They ask about fuel consumption and get told petrol is coming down so they dont need to worry about it.

    They are asking about the sparks being thrown by redundant parts of the car, and are being told that the older models threw far more sparks so it doesnt matter.

    They ask about the seats which appear to have springs coming out, and are told it is so comfortable they will hand it on to their kids.

    They ask about the sound system, which appears to play on hits and memories music only. They are told they will love it.

    They look at the car, they know what they are seeing. They ask themselves if they are seeing what they are seeing or if they are seeing what that salesman is seeing. The salesman keeps saying that is the way new cars are these days, they are seeing a clapped out overpriced piece of junk.

    They ask about the previous owner and get told it was a PR man from a mining company, but opening the boot reveals a lot of hi vis gear and a helmet.

    They suggest they arent sure about how they will fund it, and get told they can have financing through a mortgage offset.

    They tell the sales guy they will have a think about it. When he asks for their mobile they give a fake number…..

    …..as they stroll off the sale guy suggests they may miss out if they arent quick.

    • They tell the sales guy they will have a think about it.
      In Chinese business we used to call this the “Korean Maybe” not sure what maybe actually means to Koreans but it definitely not the same meaning the English speaking world associates with the word maybe.

      Its actually sort of weird to be in a meeting between Korean and Chinese businessmen that’s conducted in English (Chinglish). They all seem to understand the same gibberish and you sit there in horror wondering if you’re seeing the future direction of the English language.

      • ” They all seem to understand the same gibberish and you sit there in horror wondering if you’re seeing the future direction of the English language.”

        Beautiful! I’ve been in those meetings – they’re particularly good when dealing with Chinese officials.

        We ARE headed towards ‘A Clockwork Orange’ There will be a total failure at a general level to communicate any complex concepts.

    • The PR man just used it in the city, the dealer says, with an occasional drive to site. But the salty red dust is everywhere that can’t be cleaned.

    • The salesman offers in-house finance – “nah – don’t worry mate, we aprove anyone, just sign here”

      The low tread is sportier mate! Have you seen the tires on those F1 cars? It’s the same thing!

      The salesman turns the radio louder to cover for the smell of dead possum from the air-vents.

      Any more? 🙂

    • They ask if the yard is planning on getting any of the newer hybrid or EV models soon….

      “No fricken way! Those things are never gonna take off. V8’s mate…..shut the gate.”

    • SoMPLSBoyMEMBER

      Sounds Noice!

      Pretty sure I’ve seen that one on the Calder.Passed me on the shoulder but at least used the indicator.

      Has the Chevy Bow Tie badge in the grill and on the boot ( though not exactly centered)

      Bumper stickers read:

      1)The part falling off this magnificent car have been manufactured, installed and serviced by the finest AUS economic craftsmen /women.

      2)It’s a Holden, D!ckhead.

      3) Lucy bought a Jeep ( stick people running for cover)

      I’ll give ya $5000 down and $500 per month for 7 years and another $10,000 from my Mom’s home equity release.
      Deal?

  8. Why would anyone be interested in knowing the truth?

    Just take a blue pill and enjoy the bubbly feeling!

  9. Don’t worry The Greens have our backs, first though they want to enlighten us on the evils of gender based toys and how we are destroying our kids futures by acknowledging what sex they are. After that they will get back to Economics, like how to acquire more IPs and ignoring the population ponzi.

      • No actually I got it from their own press release. I followed their well documented research into this issue to find a couple of websites set up by regional NSW and QLD’rs set up a couple of months ago – all of it based on “vibe”.

        Nothing – no research, no documentation, nothing – just this is what we reckon.

        That’s the greens policy.

        A couple of websites set up by lunatics in the country with absolutely no credentials or research.

        But you know what – sexual orientation is not a product of marketing – it is in fact an innate trait of mammalian species – who would have thought that gender actually manifested itself without the aid of marketing !!!

        You know who we know – ACTUAL SCIENTIFIC RESEARCH.

        The same way we know that the freaks from regional NSW and QLD who set up websites claiming vaccines gives kids autism is also bullshit.

        http://docs.autismresearchcentre.com/papers/2010_Manning_Sexdimorphic_PersIndDiff.pdf%5B1%5D http://www.ncbi.nlm.nih.gov/pubmed/17017729?dopt=Citation%5B2%5D http://docs.autismresearchcentre.com/papers/2005_Knickmeyer_etal_Play.pdf%5B3%5D

        Just because people are upset about it in the Murdoch Press does not automatically mean we are destroying our childrens lives by letting them wear what colour they want and allow them to play with trucks and super soaker guns.

        It is risible bullshit of the highest order.

      • migtronixMEMBER

        Bang on Lev! And ditto to Power(hour)monger anyone that thinks the Greens aren’t fiddling along with the rest hanging their hats on idiot pet projects just doesn’t want to know…

      • Jason Baloney – the ABC was full of it last night – wow! It was about the main story for the night!

    • +1 and try to convince us of the evils of development for the environment while going full throttle on the population ponzi all while the value of their IPs ‘surprisingly’ go up.

    • Yeah, that Greens federal government sure is selling out our country. Er wait, maybe it’s all the Greens state government doing that. Or perhaps it’s just crazy time this morning.

      • If they want to be taken serious as a party then they need to address serious economic issues, not sweep it under the carpet and keep peddling their socialist agenda.

      • I don’t think you’re the audience that they’re expecting to take them seriously.

        How our Labor and the Liberals going on acquiring more IPs and the population ponzi?

      • I vote Green in some legislative positions in order to achieve democratic balance, hence I speak to them on housing – they are totally consumed by their own IP’s

      • migtronixMEMBER

        Yes, thank goodness the Greens are here to keep Melbourne liveable!

        We need to preserve Melbourne’s status as the world’s most liveable city, which means investing in a clean, fast and affordable public transport system, and ensuring we have appropriate development and access to open spaces.

        Building a fast, clean and affordable public transport system

        Labor had 11 years to fix our public transport system and all they brought us was a ticketing system riddled with bugs. They also promised Metro Rail and an Airport Link but never delivered. The Liberals have had 4 years, and instead of building public transport, want to build a toll road that will cripple us with debt.

        The Greens have a comprehensive public transport plan that includes buying more trams for overcrowded routes, filling in missing links on our tram network, fixing our broken bus system, building an expanded City Loop with stops in Parkville and North Melbourne, opening Flagstaff Station on weekends, 24/7 public transport, and Doncaster Rail.

        All this, and more, can easily be funded if we do not build the East West toll road.

        With our population growing by 2100 extra people a week, our roads are clogged and our trains and trams are overcrowded. The other parties have had 14 years but the promised investment just hasn’t happened. We need a Greens MP to hold them to account

        Brilliant f#cking plan!!

        http://www.ellensandell.com/policies#liveable_melbourne

      • I’m just laughing that you guys (apparently) have such high expectations for a party that gets what 12% of the vote?

        And holds a small handful of lower house seats and doesn’t have the balance of power in either the Victorian or Federal upper houses.

        While you’re checking out the link below, I’m sure you’ll notice that the Federal Greens Senators have an average of 1.1 total properties each compared to the Liberals 2.29, Labor 1.84 and Nationals 10.5 (seriously).

        And Greens 1, Labor 1.91, Liberals 2.45 and Nationals 3.07 for House of Reps.

        But yeah, the Greens love their IPs.

        http://www.macrobusiness.com.au/2014/08/aussie-politicians-300m-property-portfolio/

        “…along with Senator Barry O’Sullivan from the National Party who owns an incredible fifty properties (see Table 2)”

      • Since there is so much anguish over IP’s it should be remembered its a function of lobbyist bribery dating decades ago…

        “In 1946, Herbert Nelson was the chief lobbyist and executive vice president for the National Association of Real Estate Boards, and one of the highest paid lobbyists in the nation. Mr. Nelson’s real estate constituency was unhappy with rent control laws that Truman kept in effect after the war ended. Nelson and his real estate lobby led what investigators discovered was the most formidable and best-funded opposition to President Truman in the post-war years, amassing some $5,000,000 for their lobby efforts—that’s $5mln in 1946 dollars, or roughly $60 million in 2012 dollars.

        So Herbert Nelson contracted out the PR services of the Foundation for Economic Education to concoct propaganda designed to shore up the National Real Estate lobby’s legislative drive — and the propagandists who took on the job were Milton Friedman and his U Chicago cohort, George Stigler.

        Skippy… when you can hire out economics dept’s to do your bidding…. oops free market university’s…. wellie a couple of decades and she’ll be ripe…

    • > … the evils of gender based toys

      What? How are dildos and b*tt-plugs contributing to the global warming? Also – how do they fit into the Greens propaganda?
      .
      .
      .
      Oh… wait, don’t answer that last one; I have a feeling it involves a double-ender… ribbed …

    • yes that truly is a crock of shite in a long line of Greenist “laughable if not so dangerous” policies. I sometimes wonder if the sole point of doing a social science degree is to learn how to avoid calling a spade a spade. The sad thing is these twats spend so much time getting good at reimagining our common sense understanding of reality that normal people with actual productive lives to live dont have the means to respond and feel trapped when set upon by this complete bullshite.

  10. The truth is the RBA have orchestrated a massive wealth transfer from the productive economy to property speculators and called it prudent.

  11. Thats a shock, Australia’s gross national debt is at 5 trillion? Thats really blown out over last year or so, does that have anything to do with lowering of the Aussie? Banks borrowing usd?

    http://www.australiandebtclock.com.au

    Aud gross debt = 1/7 of usa housing market. Go figure.

  12. Joe Hockey said yesterday that he wanted Australians to have confidence in the future because household consumption was one of the most important drivers of economic growth.

    But this is the fricking problem Joe. Our economy already consumes much more than it produces. Where is the money supposed to come from?

    • And business isn’t buying into the rhetoric…..

      Australia building approvals. The pipeline is more worrying for non-residential building work, with the annual growth rate for commercial and industrial building approvals taking another sharp turn lower in October, down 23.5%. Approval values for office buildings (-35%) was the main drag, an outcome which may be partly owing to hangover following a very strong end to 2013 where growth exceeded 50%.

      The animal spirits wont be awakened when there is such a surplus of capacity.

      Nor is the population Ponzi without a corresponding increase in demand to soak up the additional contribution to the labour pool.

      Meanwhile Canberra, Perth and Brisbane will be cutting deep to take some steam out of growing budget deficits.

    • Strange Economics

      And so he should sing “Santa is here”, as an ex Real Estate agency family.
      Why his own $ 5 million property portfolio went up $ 1 million last year, thanks to low interest rates, negative gearing, and the pop ponzi.
      Can’t the part time working, HECs encumbered, renting youth without wealthy parents see how good it is ?

  13. Too right Joe Hockey’s words made me angry yesterday.

    “We want Australians to go out there and spend for Christmas. Don’t let Santa down, go out there and spend for Christmas,” the Treasurer said.

    I was angry because that was his response to a question over whether changes to Superannuation concessions would be considered. He proceeded the above with “We said we wouldn’t touch Super….”

    Then he got chuckly and urged the Boomers to spend. Then the director (I was watching via ABC breakfast TV) decided Super was not interesting and cut the cross.

    When those in charge of the media are among the biggest beneficiaries of the Super rorts, it will be a hard slog to get any traction on changes, and numbnuts like Hockey will continue to be allowed to dismiss the issue with throwaway lines such as the above. The fair go in Australia is dying, urged on by the Boomers and older Xers. Damn right it makes me angry.

    • The Fair Go died a while ago, as well as Australia of old. Greed, selfishness and ego are part of the Australian persona now.

      • My interpretation of what I’m seeing is that people simply do no longer have the luxury to not be selfish. I see lots of people with shitloads of debt, complaints about servicing mortgages and getting the kids through school… and then buckling to whatever pressure to do an extension to the house or buy a set of kayaks for $1,000, adding yet more debt to what is already keeping them awake at night.

        But, I agree, the Australia I encountered after migrating is far removed from the image Australians want to portray… and do portray on overseas migration conventions.

      • Political parties, and not helped by Canberra’s location, are barely related to the population and electorate, with our media or ‘medium’ (News, Fairfax & ABC) mediating everything in between…. with very slightly different variations…

        How often does one see real news or media reports about actual people having a hard time whether unemployed, in debt, sick or retired, trying to make ends meet?

        Impossible nowadays to see such scenes (though they are there) as (ageing mono cultural) media and stakeholders only want positives presented (with some negatives e.g. foreigners), therefore everyone told it’s all well, get out there and buy a house, car, vacation etc. on the tick…… then you will obey orders or at least not upset the status quo.

        So while people worship their homes, IPs, cars, toys, sport, superannuation etc., they would hardly care about much else, or simply whinge and moan a bit?

    • If Cockey wants me to spend for Xmas he should send me a cheque the way Swanny did.

      Send me that cheque Cockey!

    • Strangely, inequality seems to lead to more inequality. There is nothing a ruling class can do more than set the people off in competition with themselves. The greed, the desire for more, and the false competition is almost a perfect tool for feeding money up to the aristocrats that control the banking system, monetary policy and the land.

  14. If your world is coloured black and someone keeps telling you that it’s white, you won’t change your mind about it, you’ll dismiss the idiot that can’t see straight. If they keep doing it you’ll get angry.

    It works the opposite way as well . . . . as I regularly experience when pointing out to people the failure of the corrupt system of “elective government”.

    People who want to be happy do not want to hear information that makes them worry. They will try to change the subject. They will get angry. And they will eventually run away.

    • So true re people not wanting to hear/acknowledge information that might make them worry!

      It’s why political change will be painfully slow and why Australians are determined to be ignorant.

      • Don’t worry it will be all anyone is talking about before long.

        There will be Sunday Colour Supplements on the J-curve and why holidays in Oz can be just as much fun as holidays abroad. Australian goods – cheap and catching up to the quality of those fancy Chinese imports.

        Oh – and there will be another wave of authentic garage rock.

        So it will not be all bad.


      • there will be another wave of authentic garage rock.

        Hope you’re right about that. Not so optimistic myself – kids seem to have moved on a bit. Nice to proved wrong.

      • If what is coming out of my neighbour’s garage is any indication it is not something to look forward to!!!!!!!!

    • Yep, I have to temper myself when talking to friends and colleagues because they just don’t want to hear the reality of the situation, that the economy is just shy of recession and we’re lead by incompetent corrupt extremists.

      • Likewise Jason, i don’t share my views on RE/Economy… with most family/friends these days because it’s like talking to a brick wall…

      • I’ve been warning everyone – and I mean everyone. Have been for the last 2 years when it became clear we had entered a fools paradise or as Ross Garnaut described it in his wonderful book Dog Days Australia after the Boom – The Age of Complacency.

        The reactions fit into three primary camps

        1. We know but don’t want to hear
        2. We don’t know and don’t want to hear
        3. We’ve never thought about it
        4. We know and are trying to do something about it

        Categories 1 – 3 are in the majority but I’ve noticed in the past couple of months a growing number moving to category 4

        Only a cataclysmic change in fortunes is going to shake the country awake from its complacency – and with the headwinds getting stronger it looks like that time will come soon.

        Unfortunately the steps that should have been taken to prepare us for that time have been ignored and we will have to take our medicine.

  15. he is calling already heavily indebted people to spend money they don’t have while, at the same time, repeating “budget surplus” and “bad public debt” mantra

    • Do what I say, don’t do what I do… if you do what I do, it’s bad, m’kay? That’s only mommy and daddy stuff – you should never ever try, now off you go and play with your toys, little Timmah!

    • To be fair, he is massively increasing our public debt so he’s trying his best to help Santa as well.

  16. So the Australian population are now going to spend our way out this economic black hole, on what, goods that are made in China on our collective bloated credit cards. The adults are now back in charge.

  17. French Bank dumps UK assets. -“The UK cannot compete anymore. There has been zero structural reform,’ says Société Générale.” (Telegraph)
    How long until “French banks” dump Australia assets for the same reason?

    • Seems they are bringing home their gold stocks and they have finally admitted the con which is diesel in motor cars:

      France wants to gradually phase out the use of diesel fuel for private passenger transport and will put in place a system to identify the most polluting vehicles, Prime Minister Manuel Valls said on Friday.

      “In France, we have long favoured the diesel engine. This was a mistake, and we will progressively undo that, intelligently and pragmatically,” Valls said.

      About 80 percent of French motorists drive diesel-powered cars.

    • migtronixMEMBER

      Soc Gen can talk!! How much toxic derivatives are they still wallowing in?

      In January 2008, French trader Kerviel was arrested in Paris and accused of committing massive fraud that cost Societe Generale Bank nearly $6 billion.

      What a joke!

  18. What a bloody hypocrite Joe Hockey is! His budget burdens the most in need like students and middle class who constitute a large if not the largest chunk of our society and now he’s asking them and everyone else to go and spend money!!!!

    Screw Hockey and this government, my wallet will be sealed in red tape this christmas and beyond and most of it will be invested outside the country ASAP too

    • +1 @paulF

      and ironically, those with the highest disposable income – the Boomers – are too busy leveraging up on Investment Property to have any money left over to spend.

  19. “… undermine the government’s economic sales pitch….” – sorry, must have missed it. Anyone know were it is??? Lol

    “Across the nation, voters are waking up to the realities of a ­slowing, patchy and unpredictable economy.” – LOL’er … nice of them to open the memo. Then again, policy makers, their advisors and most economists haven’t worked it out either.

    Hockey – “Don’t let Santa down. Go out and spend.” – what a prize fool, who seemingly feels the need to prove it on a recurring basis. His brand of economics seems to be: talk the economy down, fail to stop talking it down even after lucking into government, grandiosely try to reef spending out of the economy and deny the public income, then expect them to indiscriminantly dial up debt again so that Santa isn’t upset.

    • ““… undermine the government’s economic sales pitch….” – sorry, must have missed it. Anyone know were it is??? Lol”

      I’m pretty sure it (as usual) a three-word slogan – open for business.

      • Ah yes, that one … Wouldn’t you think they’d try to go some way to making it actually meaning something? I suppose that’s difficult when the formula insists that each three-word-slogan is followed up with Labor this, Labor that diatribe. Policy is anathema to them.

        Somebody “Stop the Goats!”

        One Term Tony …

  20. Hockey. Our local version of turducken, or even turbaconducken: A chicken stuffed inside a duck stuffed inside a pig stuffed inside a turkey. Apologies to all animals mentioned.

  21. Frederic Bastiat

    What has become clear in recent months in Australia, as is clear throughout the world, is that democractic societies will never vote in politicians that ask for fiscal responsiblity.

    The lefites think mining and carbon taxes can pay for everything, the righties think that they are entitled to every tax concession their accountant can find (including neg gearing and other awful distortionary taxes).

    We have regulated GP fees, regulated Uni tuition, regulated telecommunication charges, regulated land release, regulated energy prices.

    There is NOTHING free market about this nation. A bunch of moochers and looters and whingers and morons

    • Yep, and the one thing most deserving of some modest regulation, because they fund the delusions of a nation, no one wants to touch.

      Unproductive capital inflows.

      Turn down the capital inflow happy gas (pumped in by our trade competitors) and there might be a bit more serious discussion about the costs of a nation full of lurks and rent seeking opportunities.

      • Unproductive capital inflows.

        Very important to understand. Reckless borrowing and reckless asset sales are key.

    • What has become clear in recent months in Australia, as is clear throughout the world, is that democractic societies will never vote in politicians that ask for fiscal responsiblity.

      To begin with, they are not “democratic societies”. They are societies labouring under the corrupt system of “elective government” which is an altogether different thing.

      The late economics Nobel laureate James Buchanan (in “The Reason of Rules”) described the “adverse selection” of political agents under elective government as follows:

      “[S]uppose that a monopoly right is to be auctioned; whom will we predict to be the highest bidder? Surely we can presume that the person who intends to exploit the monopoly power most fully, the one for whom the expected profit is highest, will be among the highest bidders for the franchise. In the same way, positions of political power will tend to attract those persons who place higher values on the possession of such power. These persons will tend to be the highest bidders in the allocation of political offices. . . . Is there any presumption that political rent seeking will ultimately allocate offices to the ‘best’ persons? Is there not the overwhelming presumption that offices will be secured by those who value power most highly and who seek to use such power of discretion in the furtherance of their personal projects, be these moral or otherwise? Genuine public-interest motivations may exist and may even be widespread, but are these motivations sufficiently passionate to stimulate people to fight for political office, to compete with those whose passions include the desire to wield power over others?”

      Under such conditions (and in the absence of true Democracy) it is perfectly reasonable to expect that:

      a) the system will adversely select megalomaniacal (and possibly psychopathic) politicians who act in their own interests, with minimal regard for the subjects they rule;

      b) such politicians will deliberately misrepresents the state of affairs to the public in their desperate attempts to secure votes;

      c) such politicians will engage in obscene competitions to hand out bread and circuses – each side seeking to outdo the other to secure power – running up unsustainable public debts in the process; and

      d) such politicians will engage in grubby auctions, buying off special interest groups and powerful lobbies piecemeal with gifts from the public purse . . . and look to receive favours in return, either in the form of support in government or employment in later life.

      It is noteworthy that Buchanan himself concluded:

      “In sum, the effects of direct democracy add-ons to existing decision rules surely work toward reducing the range and scope for politicization, a result supported by classical liberals.”

      The real benefit of Democracy is not its empowerment of the People (whose country it is anyway) but its neutralisation of the tendency towards adverse selection of corrupt political megalomaniacs.

      If we look at fully democratic countries (democratic at both state and federal level) we see fiscal responsibility. See for example, the Swiss vote to increase VAT to cover the shortfall in their disability pension scheme.

      In Australia and elsewhere, the Elite demand a Monopoly on Power (because “The Scum” are too stupid to be trusted), and then when things all go wrong what do they do??

      They blame The People of course!!

      The People who actually have no effective say in what is being done to them.

      Classic Elitist behaviour.

    • “Democractic societies will never vote in politicians that ask for fiscal responsibility”

      New Zealand might be the exception.

      Interesting discussion on ABC Radio last night in relation to the a publication by Oliver Hartwich – Quiet achievers: The New Zealand path to reform

      http://tinyurl.com/p5ubkya

  22. The only ‘truth’ Australians seem capable of accepting is that this country is the best of the world, with the best tasting produce, the best homes, the best Treasurer, the best Central Bank, the best cars, and the best innovative scientists.

    Any remark hinting at the fact that things could actually be improved and that there are lots of examples around the world of how to do it is met with all sorts of arguments on why this is not possible/necessary and that Australia is different.

    Meanwhile, the only things that has been different in Oz is that the country has gotten away with this conservative no-can-do attitude because of stupid, mindless stimulans by the Chinese aimed at lining the pockets of corrupt officials.

    No one wants to hear the truth and no-one even considers the fact that Australia is headed right for the cliffs. The politicians in power are a reflection of the general public, proving that democracy works and that voters only get the politicians they deserve.

    • Mate, that is how Aussies were, I think they are about to be “tuned up”, in Gunna’s methapor.WW

      • Unfortunately I still encounter this behaviour on a day-to-day basis. I have met very few people (excluding the relatively limited qty MB crowd) who actually exhibit a sense of realism.

    • ” the only things that has been different in Oz is that the country has gotten away with this conservative no-can-do attitude because of stupid, mindless stimulans by the Chinese aimed”

      Anon not evern that really. We have got away with it because we are a nation with a low population so richly endowed in mineral resources that we are willing to sell off as assets to pay for our self-indulgence.

      • Australia is still doing that, even more so than before if you look at volumes. Here in SA they are flogging whatever they have left to flog, which isn’t much. Harvest rights for timber, government buildings… not much left to delay the inevitable.

        The key thing was the inflated prices, which were due to China’s insane ‘investment’ streak.

      • interested partyMEMBER

        Flawse ole mate,
        ………when does this madness end? How long before something gives?

        Nothing makes sense any longer…….the uncertainty is almost palpable. I have never seen a society so vulnerable yet so uneducated. We argue over the colour of the rocks in the tarmac while a bloody great road-train is bearing down on us………this has to be one for the history books.

        You ever seen it this bad?

      • IP I was a farmer when the last really bad time was – stagflation of the 70’s (from memory) This seems more awful because we are further down the road and our capacity to manoeuvre is sooo much less.
        We’ve got unlatched stable doors and absent equines.

        I guess also IP that I have never seen so much unreality. It’s like everyone is living in dreamland or facebook land or some damned thing. I’d like to be able to reincarnate Aldous and get his thoughts!
        I really get depressed watchiung people. It’s like everyone has been zombified.
        I’ve related this before. The author James herriot was asked about the characters in ‘All Creatures great and Small’. Were they real people? His answer was that they were mostly composites of a few real people. He remarked that we would never get such characters ever again. Television makes for a great uniformity. People are learning their behaviour from TV image so everyone will be the same. This was in an era before the whole facebook I phone thing. People stare into these things totally braindead. Just zombified.

      • interested partyMEMBER

        Thanks mate…..I suspected as much myself.
        I agree on Aldous……..but he was departing as I was arriving or close to it…9 weeks I think, so I never did get a chance to chat with him…..anyway, I also would like to get his take of this world we live in now.

        I disappear from here ( MB ) on occasion just to gather my thoughts and to take stock of this mess. If we are correct and we are headed for the rocks, I want to be prepared as best I can be.

        Got your other response a day or so back…thanks for that.

        edit to add this……
        With society so stuffed up and zombiefied, it will not be easy on the other side of this mess…..when we need thinkers and doers to help get back on track.

      • interested partyMEMBER

        Thanks Mate…..spambot got my response. We are on the same page.
        look what turned up….

      • IP.

        Had to look:

        Aldous checked out 22 November 1963.

        Hence his death was overshadowed by that of the creator of Narnia, CS Lewis, on the same day.

  23. This is a tricky one, and philosophically it is an issue that speaks to the very heart of our current societal structure.

    Ontologically our subjective perception is tainted by immersion in the very system we are now finding ourselves questioning, even as the the government and corporate spin doctors and PR frontmen are trying to tell us that everything is fine. We know it’s not, but nor can we see the extent of the risk hanging over us right now; though to be honest we likely wouldn’t want to.

    Axiologically we are so enrolled in our reality that we have allowed our values to be framed to reflect the very things “they” have told us are most important: money, possessions, power, fame, admiration – extrinsic tokenism at it’s very best. All things to be granted by somebody else, and all things which attract a toll in return; typically our time.

    They hold so much sway over us as a collective populace (here or any other Western capitalistic democracy) that fundamental change is just about impossible in any area of endeavour, especially politics, where broad consensus needs to be achieved to make lasting change.

    So then how do you tell people that the very system they rely upon for their survival is hopelessly unsustainable? That their faith in the system and its leaders is completely misplaced? That, without a significant course correction, the end game of this system is collapse? How would you explain to them that before then we will endure decades, or even generations of hardship and impoverishment for an ever increasing number of citizens for the benefit of an ever decreasing number of citizens?

    Joe Public simply can’t comprehend or won’t contemplate the challenges we face much less the solutions and potential costs involved in breaking the social/economic/political paradigms that determine the course of our lives, even were this clearly for the better of ours and our children’s generations.

    Whether it be part of some grand “New World Order” conspiracy or just the unintended consequences of a poorly designed system introduced back in the days before technology made its influence so absolute I don’t know and it really doesn’t matter that much.

    What is certain is that, in time, we will get our “alternatives”, but we should not expect anything else from them that we haven’t seen before, nor should we expect any substantial change to the status quo – that is a truth that is simply too inconvenient for most people to be confronted with.

    • interested partyMEMBER

      Well put.

      You highlight the magnitude of the problem all too well!

      Good grief……….the sweet despondency that is MB…..

    • Western capitalistic democracy???

      It is not a “democracy”. See comments above.

      Joe Public simply can’t comprehend or won’t contemplate the challenges we face . . .

      Research by groups like the Initiative and Referendum Institute shows that people living under actual Democracy (or even partial Democracy) are more informed of issues than those living under the corrupt system of elective government.

      Under elective government there is no point understanding issues, because one’s opinions don’t count for anything anyway.

      If Democracy were the problem, then why are the Swiss – the most democratic people of all – not in the most hopeless fiscal position?

      In fact the exact opposite is true.

      • Stephen, I was suggesting that reference in name only, certainly not in nature.

        I was a member of the LIberal Party for enough years to educate myself on the difference – hence the decision to leave (well that and Tony Abbott!)

        I’m quite a fan of direct the notion of direct democracy but I fear that even that can be corrupted by vested interests (particularly those aligned to MSM.)

        The challenge is how to make opinions count within the structure of the sham of a system we have right now without having to tear it down and start again.

        Perhaps it will necessitate pitch forks in the end – the US administration certainly seem to be preparing against that eventuality.

      • The challenge is how to make opinions count within the structure of the sham of a system we have right now without having to tear it down and start again.

        Waste of time and effort.

        With Democracy, all else will follow.

        Without Democracy, all other battles will ultimately prove futile, eventually white-anted by the relentless power of rent-seeking under the corrupt system of elective government.

        Concentrate the firepower on the battle worth fighting. The battle for Democracy. Everything else is a distraction.

      • People will still vote in their own selfish interest and out of their own ignorance.

        Can you imagine Sydneysiders and Melbournites. who will totally control such a ‘democratic’ government voting now for sacrifice to give a better deal for the regions and rural Australia?

        it ain’t gunna happen!

      • It depends how one defines “People”.

        Is Australia one “people” or is it six (or more) “peoples”?

        The Constitution would require double majorities to enact Democracy in the first place, and such an enactment would probably not pass in the smaller States unless it retained the protection of double majorities.

        Moreover, the history of popular voting both in Australia and elsewhere is that people in general oppose the centralisation of power. Of 32 centralising referenda in Australia, only 2 ever passed (compared with a 50% success rate for non-centralising referenda). Likewise in Europe, direct votes on centralising proposals (such as on the Euro in Denmark and Sweden, and on the European “constitution” in France) have seen popular defeat.

        It is politicians and rent-seekers who love centralisation. They generally impose it against the express wishes of the People(s) by using legislative tricks (such as the Lisbon Treaty which was enacted without popular vote, except for the Irish who were bought off).

        Centralisation – like all monopolisation – benefits the Few at the expense of the Many. Democracy gives the Many a weapon with which to fight back.

      • Stephen
        The catch-cry in Aus is ‘one vote one value’ which means Federally Sydney and Melbourne, because of the current economic and social distortions, rule and will continue to do so.
        Further you have a media which is Capital City centric. There is no real thorough examination of anything outside capital cities and the Sydney/Melbourne axis just gets weighier and weightier.

        Re Switzerland is a much more uniform country and much less geographically and economically divergent.

        Australian cities have been iompoverishing rural Australia for six decades. It’s difficult to see how your democratic solution will do anything buit make that situation worse given that we are where we are.

        Note: I have been in favour of direct voting referenda on matters for some 45 years!

      • I beg to differ.

        The real driver of metropolitan concentration are the “presenteeism” and “courtier” effects (by-products of elective government) discussed here.

        Most people in Sydney and Melbourne do not benefit from the current system. They are forced to accommodate to it because there has been no way to change it.

        Ask how many people would prefer to live in a smaller city or even a town if only there were decent jobs and amenities there.

  24. A $1,000,000,000 a month interest bill on Australian Government debt. The Senate refuses to pass Budget savings yet demands even more borrowed money be spent. The nation is hostage to harridans like Lambie. Labor is complicit, apparently possessing no long term interest in the future of the country, incapable of focus on anything beyond the next election. Petty partisan politics has poisoned the national interest.

    There is no palate for serious reform, no unifying vision – I guess we’ll continue to muddle along in our boom-bust way.

    She’ll be right mate.

    • interested partyMEMBER

      There is no national interest. You yourself have correctly stated that “vested interests are the economy”…..so sort that out first before lambasting all others ….bar lib.

      • Vested interests are the economy !

        And Governments must carefully manage the balance between vested interests advocating a greater share of the pie and the longer term economic health of the nation.

      • Under the corrupt system of elective government, governments themselves (that is, politicians) are the vested interests!!

    • Its right that the total revenue stream of government is reviewed not just cutting from those whose collective political clout is slight.

      Thus I see Lambie’s approach as both honest and appropriate to delivering a circuit breaking opportunity to do things properly.

    • “Labor is complicit, apparently possessing no long term interest in the future of the country, incapable of focus on anything beyond the next election. Petty partisan politics has poisoned the national interest.”

      I know you don’t have much to work with these days, but seriously?

      http://www.crikey.com.au/2014/04/30/coalition-hypocrisy-abbott-and-hockey-in-their-own-words/

      On whether families on $150,000 should get social security …

      Abbott, May 2011, on Labor’s move to freeze the indexation of welfare payments to families earning $150,000:

      “These are class-war cuts that the government is inflicting on people.”

      Hockey on Labor’s move, 2011:

      “… the politics of envy.”

      Abbott in his budget reply speech, May 10, 2012:

      “The fundamental problem with this budget is that it deliberately, coldly, calculatedly plays the class war card … families on $150,000 a year are not rich, especially if they’re paying mortgages in our big cities.”

      • Political and economic discussion is now just slogans. Not sure what the cause is – media maybe. Maybe it is just us. We want what we want and’ don’t bother with detail or excuses’!

      • It is now clear we are heading toward difficult times. Steps must be taken to address the Budget blowout inevitable in coming years and to restrain the growing Government debt burden.

        When Labor refuses to pass savings measures it designed you know it’s National Interest game over. When it blocks savings initiatives and passes spending commitments you know it’s National Interest game-over.

        Labor’s only interest is the next election. Game-over.

      • GunnamattaMEMBER

        Well they have been set such a superb example in the current government!

        The Torynuffs are on the spit……(and they wanted it)

        slap an apple in TestosterTones gob and roast away.

      • This is exactly the garbage that is rotting the budget.

        Free money for people who don’t need it and baby boomers addicted to entitlements.

        A few ideas that will never sway with the greedy voters and complicit politicians…

        Means test the family home and reduce the maximum allowable assets for the age pension to $500K – sell down your assets in retirement – why should we subsidise your children’s inheritance?

        Reduce all family benefits to zero

        Negative gearing to be quarantined against income from the asset

        No novated leases etc – throw out the tax code, start again with zero deductions

        No childcare rebates

        Get rid of the Federal Education, Environment and Health departments – or alternatively have the balls to get rid of all state governments.

        No private health insurance rebates

        Cut the ABC and SBS in half – news only – the rest can go

        Surplus in no time and the tax cuts would be affordable and huge.

    • 3d1k – The Libs have absolutely refused to engage in any serious thinking re the economy and Australia. Mind you i do think the whole of westarn civilisation went down this road.

    • You do realise that you with your defence of vested interests are part of the problem too, don’t you?

      • interested partyMEMBER

        To be fair here, we all defend our own little patch in some form or other. 3D is very correct that vested interests are the economy……always have been and always will be, no matter the governing structure or bias.
        I agree with 3D on the basis that good governance will soften the pain…….however……show me good governance in this day and age, and I will show you my unicorn.

  25. Don’t let Santa down, go out there and spend for Christmas,” the Treasurer said.

    You guys are reading too much into it. Mr Hockey has obviously been conscripted to play Santa at the local shops. He’s just trying to drum up some extra business and photo opportunities for self.

    • Hill Billy 55MEMBER

      As someone else has said, the way Joe could play Santa is to put some cash into the hands of ordinary australians to enable them to pay off some debt and hence to get the system creaking over.

      However, he is idealogically opposed to such and therefore just meanders around offering platitudes in the hope that some misguided people actually do have some coin to spend. Good luck with that!!

  26. Since there is so much anguish over IP’s it should be remembered its a function of lobbyist bribery dating decades ago…

    So Herbert Nelson bribed propagandists who took on the job were Milton Friedman and his U Chicago cohort, George Stigler. Circa 1946.

    Skippy… when you can hire out economics dept’s to do your bidding…. oops free market university’s…. wellie a couple of decades and she’ll be ripe…

  27. deep-seated pessimism from a loss of confidence in social and economic institutions

    Which for three decades now have been inculcating people to focus on pursuing their own self-interest and a liberalising of markets above all else. Not surprising then that it is difficult now to build a narrative about what needs to be done for the good of our country, when those economic and financial institutions and politicians have juiced asset prices, lowered tax for the wealthiest, boosted private debt, and creamed workers’ real wages.

    Now they have decided that some of those self-interested people need to stop being so greedy and think about future generations. It is all so transparently bunkum that no wonder people are detached and cynical and afraid. There is no national narrative beyond the sentimental cultural signals used to sell fear and beer.

    The economic future belongs to command or autocratic economies that can more readily dictate the narrative, or those that have spurned the neo-liberal dogma of free markets and freedom of capital movement and free exchange rates. A country as narrow and faithless and shallow and credulous as Australia is just a cork on the ocean.

      • Not just B.A.

        I am actually quite positive about the future.

        We are not talking about major reforms and they can be introduced gradually.

        Won’t be a piece of cake but people are quite capable of getting it together when the need to.

        For the most part we are talking about fine tuning aspects of the 1980 reforms.

        Regulating to limit unproductive capital flows starting with the most blatant. That will be a big step forward for the housing ponzi but fixing supply along with other dysfunctional or uncompetitive markets are also required.

        While that involves some reduction in free trade, purity is for the birds. As for trade in goods and services that is less of a concern but regs for quarantine, dumping, slave labour, envionmental issues are already in place.

        Rethinking the role of monetary policy (and therefore the RBA and the private banks) with respect to the money supply and fiscal policy is sensible but moving back to a massive public sector need not be part of the recipe. In areas where public ownership is practical amd works do it if not don’t.

        I am not convinced that fiat currency should be created by private banks. I would be more included to let them issue their own bank notes to those willing to accept them and restrict their role with respect to fiat to mere intermediary and full reserving for at call deposits.

        The point of experience is to learn from it – we have had some valuable lessons from the last 30 years – lets not waste them.

  28. hmmm – i thought the budget was about telling us its not all wine and roses – cuts to the ABC and tertiary institutions are about pulling back funding to nice to have but ultimately non productive entities. Tony and Joe have got it partially right. They just need to deal to the housing ponzi … if they did that then they would be worthy of a century of governance.