Peter Hartcher is an old mate but this is just plain wrong:
The better Australia’s economy, the worse its politics. The bigger its boom, the smaller its politicians. And the greater the crisis in the world, the more trivial the crises that consume Canberra.
Australia’s economy has entered its 28th year of growth, unprecedented for any developed country. At the same time, its federal Parliament pitched itself into its most dismal performance since coup fever took hold with sudden ferocity in 2010.
…The fade-out of the mining boom put a drag on growth that continued for about five years, but this week’s figures showed Australia had successfully made the transition from post-boom brooding to a new phase of broadly based growth.
This is welcome evidence of resilience – the mining boom turned to bust, yet the larger economic boom rolls on. This continues one of the most consistent paradoxes of modern Australia. How can Australia be one the economic marvels of the world, yet its politics be so pathetically pointless?
I’d suggest that it’s not a coincidence.
When Australia casually tipped John Howard and Peter Costello out of power, it was the first time postwar that the electorate had removed a government at a time of unambiguous economic growth. The people, it seems, no longer gave governments credit for good times. By that time, Australia’s economy had been growing for a record continuous 14 years. The longer it rolls on, the more inevitable the long boom seems. Liberated from electoral responsibility for the economy, the political class seems to feel liberated to indulge itself in the pettiest of personal and factional bickering. Across both major parties.
Here’s what you need to update yourself on, Pete. The economic boom does not “trickle down” any longer. According to the ABS, the real average compensation per employee fell another 0.4% in the year to June 2018 to be 4.2% lower since March 2012:
The below chart tracks quarterly real per capita HDI:
As you can see, quarterly real per capita HDI has fallen by 0.8% since June 2012!
Below is the same chart presented on a 4QMA basis:
Here, real per capita HDI fell by 0.3% in the year to June 2018 and has fallen by 0.2% since June 2012.
To add further insult to injury, the growth in real per capita HDI so far this decade remains anaemic at just 0.60% per annum, which is lower than the 1960s (2.34%), 1970s (1.86%), 1980s (0.90%), 1990s (1.30%), and 2000s (3.18%):
The truth is households have not gone anywhere for six years and have hardly budged in ten. This is unprecedented in modern history and coming on the end of a boom is a slap in the face to a polity with high expectations.
Moreover, this is a fatal disconnect between Canberra (including Pete Hartcher) and the polity as the former only chases policies that keeps the headline boom running while the lived experience of falling living standards is first distressing then angering for voters when it is denied.
No political party can hold support for long under these conditions and PMs keep getting necked as result. Internecine party politics then makes it worse but they are symptom not cause.
