Monday, May 14, 2012

Environmental accounting: completing the picture

Dinner Talk to ABS Conference on Environmental Accounting, Melbourne, Thursday, May 14, 2012 Ross Gittins, Economics Editor, The Sydney Morning Herald I’m pleased to be invited to speak to this dinner of a conference convened by the nation’s official bean-counters. I don’t use that term disparagingly. Some people may think they’re far too talented or too important to waste time counting the beans, but I’m not one of them. If...
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Saturday, May 12, 2012

Why the budget isn't as contractionary as it looks

If you take the figures at face value, this week's budget is deeply contractionary, delivering a blow to demand at a time when parts of the economy aren't at all strong. But in economics, it's rarely wise to take things at face value. There are different ways to assess the "stance" of fiscal policy - to work out the direction and size of the effect a budget will have on the economy. Settle back. There's a two-way relationship...
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Wednesday, May 9, 2012

How Swan did his budget trick

If you are having trouble seeing the horror budget we were told to expect, that's according to plan. This government has always wanted to be tough in principle, but never in practice. For most people, Wayne Swan's fifth effort doesn't contain much that is nasty and includes a few things that are quite nice. To be sure, it does include some nasties for higher income earners. Individuals earning more than $300,000 a year will...
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Monday, May 7, 2012

Reserve steals Swan’s budget forecasts thunder

While normal people are awaiting tomorrow night's federal budget to see if the measures Wayne Swan announces are naughty or nice, misguided souls in business and the financial markets are more interested in knowing Treasury's forecasts for the economy in 2012-13. Well, wait no more. This year the key forecast for year-average growth in real gross domestic product in 2012-13 is the budget's worst kept secret. It's taking the...
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Saturday, May 5, 2012

Pre-budget primer: how pollies fudge the figures

When governments discover their self-imposed budget targets are harder to achieve than they expected, they face an almost irresistible temptation to cover the gap with a little creative accounting. As we wait to see on Tuesday night the herculean efforts the Gillard government has made to keep its promise to achieve a budget surplus in 2012-13, let's review some of the tricks governments get up to when they find themselves in...
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Wednesday, May 2, 2012

Truth is almost always in the middle

I like Americans. I have American friends, and I remember a trivial incident that endeared me to Americans forever. We were in a funicular going up one of the hills surrounding Lake Como in Italy, at close quarters with a group of Yanks. They were joking and teasing each other in a way that struck my contact-deprived mind as very Australian. But thanks to a great American institution, the Pew Research Centre, I now realise I...
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Monday, April 9, 2012

What Jesus said about capitalism

Most churchgoers see no great conflict between their beliefs and life in a market economy such as ours. But proponents of the little-known "sabbath economics" argue Christ's teachings have been reinterpreted over the centuries to make them fit with modern capitalism. All I know about sabbath economics comes from the little book, The Biblical Vision of Sabbath Economics, by the Californian theologian and teacher Ched Myers. I'll...
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Saturday, April 7, 2012

How to improve investment advice to retirees

They say that at every stage of life the baby boomers reach, the world changes to accommodate their needs. So now the boomers are starting to reach retirement, it's the investment advisers' turn to lift their game. To date, the superannuation industry's greatest attention has been paid to the accumulation phase: how much people need to save to ensure an adequate income in retirement. But the boomers' interest is switching to...
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Wednesday, April 4, 2012

How business is white-anting the weekend

Whether or not they realise what they're doing, Australia's business people, economists and politicians are in the process of dismantling the weekend and phasing out public holidays. And they're doing it in the name of making us better off. Historically, the two arrangements that have protected the weekend and public holidays from encroachment by employers are state government restrictions on trading hours and the requirement...
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Monday, April 2, 2012

Let's slow down the mining boom

Innovative thinking is not only in short supply in Australia's businesses - as our weak productivity performance attests - it's also hard to find in the economic debate. You could count on one hand the economists who do some lateral thinking and throw into the debate some new way of viewing a problem and overcoming the familiar difficulties. But one economist who does come up with new ideas to think about is Dr Richard Denniss,...
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Saturday, March 31, 2012

We risk letting lawyers stifle innovation

If our business people, economists and politicians are genuine in their desire to lift our productivity, rather than just moan about the Fair Work Act, they'll put reform of the regulation of intellectual property high on their to-do list. Unfortunately, the minor changes to intellectual property regulation put through Parliament last week, to the accompaniment of great self-congratulation by the Gillard government, suggest...
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Wednesday, March 28, 2012

Why most of us live in big cities

We live in the age of the city. A year or two ago we passed the point where half the world's population was now living in urban areas. This is because the rapid economic development of many large but poor countries is as much about urbanisation as industrialisation. Now experts are predicting the proportion of us living in cities will rise to 70 per cent within the next 40 years. This isn't happening by accident. People migrate...
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Monday, March 26, 2012

Subsidies no way to fix high dollar problem

Emeritus Professor Max Corden, of Johns Hopkins University, formerly of Oxford University and now back at the University of Melbourne, is probably Australia's most distinguished living economist. So when he writes on what we could do about "Dutch disease" we ought to take note. What follows is my account of his paper for the Melbourne Institute, The Dutch Disease in Australia: Policy Options for a Three-Speed Economy. As is...
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Saturday, March 24, 2012

Is Australia living beyond its means?

It has become fashionable to say the US is ''living beyond its means''. But can the same accusation be levelled at Australia? It was a claim we used to hear often when people worried about the big deficits we were running on the current account of the balance of payments. During the 1960s, the current account deficit averaged the equivalent of 2 per cent of gross domestic product. By the '80s, however, it was averaging 4 per...
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Thursday, March 22, 2012

DO WE HAVE ENOUGH? HAVE THE POOR HAD ENOUGH?

Talk to TEAR Breakfast, Sydney, Thursday, March 22, 2012 I’m delighted to accept John McKinnon’s invitation to speak on TEAR’s theme for the year, Enough. What is enough for us? When will the poor have enough? The standard answer in a capitalist economy, of course, is that you can never have enough. Bigger is always better. And conventional economics gives the same answer. Indeed, the very goal of economics is to help communities...
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Wednesday, March 21, 2012

ENERGY POLICY: A MARKETPLACE OR A GOVERNMENT’S PLACE?

Debate at The Sydney Globalist launch, Sydney University, Wednesday, March 21, 2012 I'm happy to be speaking in favour of govt intervention in the energy market and against a 'free' market. I’ll be giving an orthodox, economic response to the question and my colleague John Mikler will give a more radical, political response. He’s meant to be channelling Bob Carr - who cancelled his appearance here tonight when he got a better...
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Endless growth and a healthy planet don't compute

Do you ever wonder how the environment - the global ecosystem - will cope with the continuing growth in the world population plus the rapid economic development of China, India and various other "emerging economies"? I do. And it's not a comforting thought. But now that reputable and highly orthodox outfit the Organisation for Economic Co-operation and Development has attempted to think it through systematically. In its report...
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