Being smart and being logical aren't the same

Years ago, a leading American teaching hospital admitted a 21-month-old boy we'll call Kevin. He was pale and withdrawn, drastically underweight, had constant ear infections and was refusing to eat. He'd been neglected by his parents. A young doctor took charge of his case. He hated having to draw blood from Kevin's emaciated body and noticed the boy refused to eat after being poked with needles. Intuitively, he kept invasive...

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How multinationals rort our tax system

You're familiar, I'm sure, with the Double Irish Dutch Sandwich. It sounds tasty - but only to the big multinational companies that use it to avoid tax. According to the Assistant Treasurer David Bradbury in a speech he gave late last year, it's the device Google uses to pay very little Australian company tax on the profit it makes on an estimated $1 billion a year in Australian advertising revenue. As Bradbury explains it (using...

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CAN AUSTRALIA BECOME THE FOOD BOWL OF ASIA?

RAS Hot Topic Debate, Sydney Showground, Tuesday, March 26, 2013Can Australia become the food bowl of Asia? Short answer: probably not. Longer answer: not without either a lot of taxpayer subsidy (which is unlikely to be forthcoming) or without a lot more economic reform than rural voters have shown any sign of being willing to accept.I suspect I’ve been invited here today as the anti-hero, the economic rationalist bad guy for...

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Labor and Liberals must end budget dishonesty

An immediate federal election is the last thing we need unless we're happy for it to be a fiscal lucky dip. Both sides have much work to do yet to provide voters with adequate information on the cost of their policies and election promises and how they'll be paid for. Labor must deliver this mainly in the budget; the Coalition must release its facts and figuring no later than early in the election campaign proper. And don't...

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How what's hurting most is also what saved us

While many business people see the economy as badly performing and badly managed, our econocrats see it as having performed quite well and better than could have been expected. Why such radically different perspectives on the same economy? Partly because business people - particularly those from small businesses - view the economy from their own circumstances out: If I'm doing it tough, the economy must be stuffed. By contrast,...

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Economists show racism alive and well in Oz

Australians aren't racist - and even if some people are, you and I certainly aren't. It's true, of course, that many of us are terribly stirred up about the arrival of so many uninvited boat people. And both sides of politics vie to be seen as harsher in their treatment of these interlopers. Then there's Julia Gillard's new-found concern about foreigners getting to the head of the jobs queue. But this has nothing to do with...

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Tax facts contradict voters’ perceptions

Is Labor a big taxing, big spending government, as Tony Abbott and his Liberal colleagues claim, or has it been taxing us a lot less than the Howard government did, as Wayne Swan claims? As with many conflicting claims by pollies, it depends on how you interpret the figures. In truth, the Libs always make such a claim against Labor because it plays into the electorate's deeply ingrained stereotypes about the strengths and weaknesses...

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Why tax revenue is falling short of budget

Try this quick quiz: which matters more, the growth in ''nominal'' gross domestic product or the growth in ''real'' GDP? Sorry, it was a trick question. The right answer is a favourite reply of economists: it depends. If your interest is in how fast the economy's growing (or not growing), the answer is real GDP - GDP after allowing for the effect of inflation. But if your interest is in how fast the federal government's tax...

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FROM BIG DATA TO KNOWLEDGE

Talk to NatStats 2013 Conference, Brisbane, Thursday, March 14, 2013I want to make a contribution that’s a bit offbeat and a bit challenging, but hope is constructive. This conference is based on a proposition that’s simple, seemingly obvious and even admirable: the better information we give people, the better will be the decisions they make. Indeed, I imagine that’s a proposition that guides the whole of the bureau’s work....

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'Wealth creators' push materialism over social side

There is a contradiction at the heart of the way we organise our lives, the way governments regulate society and even the way the Bureau of Statistics decides what it needs to measure and what it doesn't. Ask people what's the most important thing in their lives and very few will answer making money and getting rich. Almost everyone will tell you it's their human relationships that matter most. And yet much of the time that's...

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Productivity improves, but no one notices

You could call it the mystery of the disappearing productivity crisis. Last week's national accounts for the December quarter confirmed that, if we ever really had an underlying problem with weak productivity improvement, we don't have one now. By now, that's not such a mystery. No, the puzzle is why the people who made so much noise about the supposed productivity crisis show little sign of having noticed its evaporation. For...

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Underneath, the economy is slowing

THE world is a complicated place - and the Bureau of Statistics' national accounts are more so. Sometimes they're better than they look, but the figures we got this week aren't as good as they look. On their face, they say real gross domestic product grew by 3.1 per cent over the year to December. Since the economy's trend (medium-term average) rate of growth is about 3.25 per cent a year, that doesn't look too bad. The worry...

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