Why bribery is key to boosting our economic prosperity

By MILLIE MUROI, Economics WriterOf all the incentives in the world, money must be among the most powerful. Since its birth thousands of years ago, dosh – chasing it, saving it, and paying it back – has driven us to ruin but also some remarkable feats. So, it shouldn’t be any different when it comes to the “p” word.Before your eyes glaze over at the mention of productivity, you should know that had it improved more in recent...

Read more >>

Don't worry, you'll have enough in retirement ... with one big proviso

Sometimes I think I should appoint myself chief ageing reporter for this august organ. Why? Because I’m the only one left around here to know about – and care about – what’s happening to the oldies. But the truth is it’s not a lot more oldies we need to attract to secure this masthead’s future. That’s why we’re training up bright young economists such as Millie Muroi.But, while we’re having old folks’ day, let me ask you a personal...

Read more >>

Oligopolists gouge power and gas prices, Albanese cops the blame

If, as seems likely, Anthony Albanese and his government lose seats at next year’s federal election, one thing we can be certain of is that the nation’s economists and econocrats won’t be admitting to their not insignificant contribution to Labor’s setback.Economists have such a limited understanding of how the behaviour of the real-world economy differs from the economy described in their textbooks and measured in their econometric...

Read more >>

Trade deficits don't have to be wicked, unless you believe Trump

By MILLIE MUROI, Economics WriterWhile the US president-elect would have you believe a trade deficit is a wicked thing, it’s not a hard and fast rule. In fact, it can actually be good. We’ve become used to the word “deficit” being synonymous with “bad” (think about how many governments highlight when they’ve got a “budget deficit” – not a lot!). But deficits don’t have to be bad.Since late 2016, Australia has had a run of trade...

Read more >>

We've entered the era of gutless government

Sorry to tell you that I’m finishing this year most unimpressed by Anthony Albanese and his government. I’m still reeling from his last two weeks of parliament, pushing through 45 bills just to show how much he’d achieved and give himself the option of calling an election early next year should he see a break in the clouds.Some of the measures pushed through at breakneck speed merited much more scrutiny, while some reforms that...

Read more >>

The Australian economy is behaving strangely

By MILLIE MUROI, Economics WriterAustralian consumers are usually the engine room of the economy. Every extra dollar we spend drives economic growth higher – and there’s so many of us that we’re usually a force to be reckoned with. In the three months to September, though, something strange happened.We had more income to splurge but shied away from spending much of the extra cash according to national accounts data from our number-crunchers...

Read more >>

How Albanese is tighten up on tax-dodging multinational companies

By MILLIE MUROI, Economics WriterEarlier this week, a crucial piece of legislation made its way through parliament. It didn’t receive a lot of fanfare, but it’s a long-overdue tweak to our tax system.You probably know companies such as Amazon, Apple and Microsoft. They’re multinational corporations that make hundreds of billions of dollars in profit every year, some of it right here in Australia – and probably from you as a customer.Yet,...

Read more >>

Playing a major role in saving the planet could make us rich

If you’ve ever been tempted by the thought that Australia forging our future by becoming a global “superpower” is a nice idea but probably not a realistic one, I have big news. New evidence shows it’s the smart way to fund our future.Last week, while we were engaged in a stupid argument over whether the Future Fund should continue growing forever and earning top dollar by being invested in other countries’ futures rather than...

Read more >>

Our politicians aren't acting their age. That's a good thing

By MILLIE MUROI, Economics WriterIf I told you someone, especially a politician, wasn’t acting their age, you might safely assume that’s a bad thing. What childish behaviour have they indulged in this time, you might ask.But this week, it’s a compliment. The fountain of youth still evades us, and there’s no great anti-ageing commission – AAC, not to be confused with the ACCC – on the way. But the focus in Canberra has switched,...

Read more >>

How climate-denier Trump may leave China to save the planet

To a sensible person, the most worrying aspect of the re-election of Donald Trump is his refusal to take climate change seriously. He says it’s a hoax and a scam.There’s no denying that Trump’s decision to again withdraw America from the 2015 Paris Agreement to reduce greenhouse gas emissions and limit the global average temperature increase to below 2 degrees is a setback.It could tempt many other countries to give up their...

Read more >>

Memo to RBA: If wages growth isn't the problem, what is?

 I can’t help wondering if the Reserve Bank isn’t misreading the economy. And it seems I’m not alone.When you’re seeking to manage the economy through its ups and downs, it’s critically important to diagnose its problems correctly. If you’ve misread the symptoms, you can make things worse rather than better. Or, for instance, you can single out citizens who had the temerity to borrow heavily to buy their home and subject...

Read more >>

How can jobs and joblessness both be going up?

By MILLIE MUROI, Economics WriterDespite more than two years of higher interest rates, meant to slow down spending and activity in the economy, unemployment in Australia remains unusually low.The nation’s chief number-crunchers, the Australian Bureau of Statistics (ABS), said there were 16,000 more people employed in October, while the number of unemployed climbed by 8000. The unemployment rate stayed at 4.1 per cent for the...

Read more >>

Education is leading the two sides of politics to change sides

A strange thing is happening in politics. People who in earlier times could have been expected to vote for the right-wing party are now more likely to be supporting the party on the left, while those who would have voted for the left in times past are now more inclined vote for the right.This is something the insiders – the political scientists, pollsters and party professionals – know all about, but the politicians prefer not...

Read more >>

Will Trump be disastrous for our economy? I doubt it

When, in its wisdom, the American electorate does something really stupid, it’s tempting to predict death and disaster for the whole world, including us.But though the Yanks are embarking on a bout of serious self-harm – and this will have costs for the rest of the world economy – let’s not kid ourselves that we’ll be prominent in the firing line.Leaving aside Donald Trump’s climate change denial – a topic I’ll get to another...

Read more >>

How we measure recessions is wrong. There's a better way to do it

By MILLIE MUROI, Economics WriterOf all the scary words in economics, recession is probably among the worst. Not just because of the bad times we link it with, but because of the way it’s measured.What if I told you the way we measure recession is wrong? Or at least that we need to give it a rethink?The widely used rule for a recession is “two consecutive quarters of negative economic growth”. That means two sets of back-to-back...

Read more >>

You can blame Albanese for all our woes - except the cost of living

I try not to be a pollie basher – we get the politicians we deserve – but I can’t remember a time when I’ve been more disillusioned and disheartened by the performance of both major parties. It’s fair to criticise them on every topic except the one that obsesses us: the cost-of-living crisis.Let’s start with that. For several years, we had prices rising at a rate that was actually lower than the Reserve Bank and economists regarded...

Read more >>