Now for some fake “trust in government” reform

The ScoMo Government is a masterful fake. It is currently pretending to cut immigration, pretending to reform banking, pretending to build infrastructure, pretending to be a good economic manager, pretending to care about weak wages, pretending to care about energy prices, pretending to care about anything and everything other than rising house prices.

This we know from its only policy positions of substance:

  • full bore mass immigration;
  • the gutting of regulatory reform post-Hayne;
  • running fiscal surpluses in times of economic weakness;
  • forcing the RBA to heal for more rate cuts;
  • delivering only demand side stimulus for housing.

It therefore makes sense to add fake trust to an agenda of purely fake national interest policy. To wit, at The Guardian:

Scott Morrison, speaking to Institute of Public Administration ahead of the Thodey public service review being handed to government, will suggest that the “trust deficit” in politics is worst among middle-income Australians and call for greater use of corporate skills and diversity of viewpoints in the public service.

Morrison’s speech, seen by Guardian Australia, takes up the thread of his claim to respect the public service’s professionalism while demanding that once the government sets its policy direction he “expects them to get on and deliver it”.

Morrison suggests his government ministers “must not allow a policy leadership vacuum to be created, expecting the public service to fill it and do their job” and warns public servants that they must be “an enabler of government policy not an obstacle”.

The prime minister will urge the public sector to prioritise service delivery for “quiet Australians” who are not represented in Canberra by “vested and organised interests” such as corporations or the social services sector, which has been a persistent critic of the Coalition’s unwillingness to raise unemployment benefits.

“There is strong evidence that the ‘trust deficit’ that has afflicted many Western democracies over recent years stems in part from a perception that politics is very responsive to those at the top and those at the bottom, but not so much to those in the middle,” Morrison says.

“This will not be the case under my government. Middle Australia needs to know that the government (including the public service) is on their side.”

Morrison argues that the public service must be more open to outsiders because many of Australia’s “brightest minds” will not have previously worked in the federal bureaucracy.

So, a trust deficit will be repaired by the bureaucracy doing as it is told. Ross Gittins picks this up today:

We’ve come to expect that if the person taking the treasurer’s job doesn’t know much about economics, Treasury will give them a crash course and get ’em up to speed. But former senior Treasury officer Paul Tilley’s new book, Changing Fortunes, leads me to think this no longer happens.

These days, treasurers are so preoccupied by the daily battle for political survival they have little time or interest in economics tutorials. Treasury has got out of the habit of giving the treasurer any advice his staff doubts he’d want to hear. Treasury’s job is largely to supply facts and figures when demanded by the treasurer’s staff.

In which case, you have to worry about how much professional rigour goes into producing the budget forecasts. How much they’re designed to avoid giving the treasurer news he doesn’t want to hear.

The Reserve Bank’s latest forecasts for wage growth are laughing at the optimistic forecasts of the budget in April. Where the budget has wages growing by 3.25 per cent a year by June 2021, the Reserve has the growth rate rising only a fraction to 2.4 per cent.

But here’s the surprising thing. Despite the central importance of wages in driving consumer spending and overall economic growth, the Reserve’s year-average forecasts for real GDP differ little from those in the budget.

I find this suspicious. And worrying. If the central bank feels constrained by the forecasts of a Treasury anxious to avoid displeasing it political masters, we’ve got a problem.

Last week, while worries about how much damage Trump’s trade war might do to the world economy were causing share markets to plunge, Treasurer Josh Frydenberg – who was 20 at the time of our last big recession – emerged from his bunker to assure us the government would “take the necessary actions to ensure our economy continues to grow”.

Great. But who’ll be advising him on which actions are necessary? The young punks in his office?

No. It will be the Property Council of Australia. Masters of the fake.

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