Saturday, August 30, 2014

Digital revolution transforms productivity debate

A second former econocrat has joined former secretary of the Prime Minister's department Dr Mike Keating in seeking to lift the tone of the economic debate. "We are spending too much effort debating how and how quickly we should bring the Commonwealth budget back into balance," Dr Ric Simes said in a speech to the Australian Business Economists this week. "We need to elevate the economic debate from the level of catchcries...
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Wednesday, August 27, 2014

Why almost all of us are 'out of touch'

When politicians say things such as that the poor don't buy petrol, it's easy to accuse them of being "out of touch". Actually, all politicians face that accusation before they're through. It's one of our favourite things to say about pollies we disapprove of. But let's turn it around: exactly how in touch are you and I? Much less than we imagine. We know a lot about our own circumstances and those of our friends and neighbours,...
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Monday, August 25, 2014

Mining boom makes little sense

Conventional economic analysis assumes the behaviour of businesses is always rational but, in reality, the booms and busts that cause the ups and downs of the business cycle are driven by emotion more than rational calculation: unwarranted optimism, greed, impatience, short-sightedness and herd behaviour. Consider our resources boom. The ideology of economic rationalism says private enterprise can do no wrong; ill-advised...
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Saturday, August 23, 2014

Many reasons for the impossible: power demand falling

We know the two great certainties in life are death and taxes, but many thought there was a third: the inexorable rise in consumption of electricity. As the population grew and each of us got a little more prosperous each year, we'd use more power. The mighty electricity industry was built on that certainty. Except that electricity consumption has been falling for the past four years. To say this has taken the industry...
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Friday, August 22, 2014

CARING ABOUT FAIRNESS

Talk to Legal Aid Conference, Sydney, Friday, August 22, 2014I’m trying to give fewer speeches these days, and I knock back far more invitations than I accept, but I agreed to talk to you today mainly because I felt I ought to thank you. Thank you for the work you’re doing, for the contribution you make in ensuring that people are informed about their rights and responsibilities under the law and are adequately represented before...
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Wednesday, August 20, 2014

Abbott's economic script is out of date

It doesn't seem yet to have dawned on Tony Abbott that he was elected because he wasn't Julia Gillard or Kevin Rudd, not because voters thought it was time we made a lurch to the Right. The man who imagines he has a "mandate" to mistreat the children of boat people, ensure free speech for bigots, give top appointments to big business mates and reintroduce knights and dames, represented himself as a harmless populist before...
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Monday, August 18, 2014

Stop wasting money on infrastructure

Don't laugh too hard at the ABC's new satire, Utopia, and the wasteful and appearances-driven antics Rob Sitch gets up to as head of the Nation Building Authority. It's too close to the truth to be funny. One of the foremost areas where governments need to lift the efficiency of their spending - as opposed to cutting payments to the needy or short-sighted cost-shifting - is infrastructure. It has become an area where too...
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TALK TO TREASURY SEMINAR ON COMMUNICATING ECONOMIC IDEAS

National Library of Australia, CanberraAs far as journalism is concerned, economics is the great contradiction. On the one hand, there’s no subject more like to get you a guernsey on the front page. On the other, there’s no subject more likely to confuse, irritate or simply bore the reader rigid.If economics is the study of the ordinary business of life, and GNP is what ensues when 86 million Americans get up and go to work,...
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Saturday, August 16, 2014

Economists should learn some geography

One of the great failings of economists is their confident assumption that their way of looking at the economy is the only way - certainly, the only useful way - of understanding it. For one thing, their almost exclusive focus on money - prices, actually - and their convenient assumption that people are rational, allows them to analyse an economy populated by automatons rather than fallible, flighty humans. Behavioural...
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Wednesday, August 13, 2014

Big business now calling the economic shots

Sometimes I wonder whether the economy is being managed for our benefit or for the benefit of the big businesses that dominate it. The two big supermarket chains we get to choose between, the two domestic airlines and privately owned airports, the three foreign mining giants that were allowed to redesign the mining tax they didn't like, and the four big banks that control so much of our superannuation and the investment...
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Monday, August 11, 2014

ALL YOU NEED TO KNOW ON THE TRICKY TOPIC OF PRODUCTIVITY

Talk to VCTA Teachers Day, Melbourne, Monday, August 11, 2014Productivity isn’t everything, but in the long run it is almost everything. A country’s ability to improve its standard of living over time depends almost entirely on its ability to raise its output per worker.                                                                     Paul...
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