Why we're going slow on climate change

Every time I go to the Byron Bay Writers’ Festival I’m asked the same question: since there’s no policy issue more important than responding to global warming, and we’re doing so little about it, why do I ever write about anything else? I give the obvious answer. Though I readily agree that climate change is the most pressing economic problem we face, if I banged on about nothing but global warming three times a week, our readers...

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Fortunately, Turnbull's tax cap is just window-dressing

The Turnbull government’s solemn pledge to cap the growth in tax receipts at 23.9 per cent of gross domestic product is a political gimmick to which no government committed to economic responsibility would bind itself. So it’s good we can be confident that, should the Coalition remain in power in the years to come, it will ditch its solemn pledge the moment it becomes politically inconvenient. Why can we be confident? Because...

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Bracket creep lives to fight another day

An Australian newspaper’s headline on the morning after the budget was SCOMO STOPS THE CREEP. The nation’s most ponderous political pundit intoned that the Treasurer would “eliminate bracket creep for the middle class”. The man himself claimed his tax-cut plan “ran a sword through bracket creep”. Sorry, yet another of Scott Morrison’s attempts to mislead us in a most misleading budget. He’s exploiting the public’s hazy understanding...

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We'll get a very clear choice at the election

The federal election campaign could be as soon as August and no later than May. So which side is shaping as better at managing the economy? Sorry, I won’t be answering that question. If you’re smart enough to choose to read this august organ, you’re smart enough to make up your own mind – which you probably already have. The partisan or tribal approach to politics – if my side’s proposing it, it’s what I prefer – is a common...

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Let's outlaw she'll-be-right budget projections

The practice of including in the budget 10-year “medium-term” projections of the budget balance and net debt is pernicious. It should be abandoned in the interests of responsible economic management. It’s supposed to increase transparency and accountability, but in practice does more harm than good, presenting the government of the day with an almost irresistible temptation to portray the future as more assured than it is. The...

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Morrison's tax cuts aim well above the middle

One thing to be said in favour of Scott Morrison’s complex three-step, seven-year tax plan is that his small tax cuts for the deserving middle income-earners are more likely to actually happen than the huge tax cuts for the undeserving high income-earners. For the latter to eventuate, Malcolm Turnbull will have to be re-elected at least twice before July 2024. By contrast, the smaller cuts will start in six weeks’ time. For...

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Morrison's peculiar tax cuts designed to hide the truth

As a boy I was interested in magic tricks, reading lots of books and learning to do a few. It taught me two terms that have proved invaluable to me as an economic journalist: “prestidigitation” and “sleight of hand”. The trick is to draw the audience’s attention towards something else so they don’t notice you palming the coin or grabbing the rabbit you’ll supposedly produce from your top hat. Politicians and their spin doctors...

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How we arrived at budgets we can't trust

After last week’s appalling effort, the resort to misleading practices in the budget is reaching the point where the public’s disrespect and distrust of politicians are spreading to the formerly authoritative budget papers. We’re used to spin doctors with slippery words. Now it’s spin doctors with slippery numbers. They’re not just gilding the lily, they’re creating an unreal world where the truth is concealed. It gives me...

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Budget assumes a kinder, gentler world

Have you heard the one about a physicist, an engineer and an economist stranded on a desert island, with only a can of baked beans to eat? The two science-types spend ages arguing about the best way to get the beans out of the can without wasting any, until the economist is exasperated. “It’s simple,” he says. “Assume a can-opener.” Don’t laugh. That old joke (which I first heard from Professor John Hewson) tells you a lot...

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A blue-skies budget

This budget is too good to be true. If you believe Malcolm Turnbull's luck can turn on a sixpence, this is the budget for you. From now on, everything's coming good. This is the blue skies budget. Things will be so good that we can have everything we want. The government can increase its spending on all the things we want it to provide. Spending cuts? Perish the thought. In Scott Morrison's words, this budget can "guarantee...

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Whatever Tuesday’s budget holds, it’s sure to be fudged

It’s a sad truth that treasurers and finance ministers almost never avoid using creative accounting to make their budgets look better – or less worse – than they really are. But this fudging often costs taxpayers a lot more. Governments of both colours, federal and state, have been doing this forever, after the bureaucrats show them how. It’s one of the less honourable services public servants provide their honourable masters. The...

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Will tax cuts boost the economy? Yes - and no

When politicians seek to win elections by promising tax cuts, they invariably cloak the inducement by claiming it will do wonders for the economy. You’re not accepting a bribe, you’re helping improve things for all of us. Treasurer Scott Morrison has said that next week’s budget will include cuts in income tax for low and middle income-earners – presumably, to be delivered sometime after the next election. Labor will also be...

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Now for a budget in cloud cuckoo land

Did you hear the news? It’s a budget miracle. Remember all the worry about debt and deficit? Gone. Not a problem. Disappeared. Or, better word – evaporated. In recent months, revenue has started pouring into the government’s coffers. According to Chris Richardson, a leading economist from Deloitte Access Economics, the budget’s “rivers of gold” are flowing again. The improvement in the budget has been “humungous”. And though...

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LAUNCH OF RED SHIELD APPEAL

Orange, NSW, May 2018If you’re wondering why an economic journalist from the Sydney Morning Herald comes to Orange to help launch its Red Shield appeal, the answer’s in two parts. First is that my parents were officers in the Salvos – my father was the Army officer in Bathurst in the early 60s – so I find it hard to say no to them. Second is that, tho these days I hold the rank of backslider, I come from an extended family of...

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