Sunday Sanity Break, 11 March 2018 - Viable economic policy needed
'I'm giving Australia a break from our new tariff policy because it's such a great little country, a loyal ally to the USA and a nation that buys aeroplanes and other stuff from us far larger in value than we buy from them', asserted President Trump, or words to that effect.
'Rocket Man' has apparently agreed to meet the Donald to discuss 'denuclearisation' of the Korean Peninsular. The President's remaining senior colleagues are doubtless concerned that the North Korean boss will run rings around their deal-meister. Still, it looks like the trade sanctions may be biting, and I'd not be surprised if the Eurozone nations are about to face some painful truths about the cost of NATO when called upon to up their cash contribution or face new trade barriers.
Meanwhile, the thirtieth Newspoll will be with us soon, and is widely expected to remain at a level that justifies at least a challenge to the leader. Trouble is, there is no-one obviously qualified to be a new leader, and Tony Abbott is ruled out to avoid Labor's Rudd'n'Gillard'n'Rudd madness. So we battle on with current management, seemingly impervious to the good news on jobs and general unhappiness with the current management.
Trouble is, Mr Turnbull, the public recognise that you know little about economics and lack decisive courage in improving third rate economic policies. Here are the things you should have a clear policy on:
* Fiscal policy needs to have a viable plan for a return to substantial budget surplus. This is so fiscal policy can help cushion the downturn when the next global crisis hits, and in the meantime allow higher spending on defence, health and education.
* Monetary policy similarly needs to be returned to some semblance of normality so it can be eased to help soften the blow from the next global crisis. (The primary focus on goods and services inflation needs to be rethought to facilitate a return to sustainable interest rates.)
* Immigration policy needs to be reformed, with about half the current level overall and better targeted to include a language test and 'commitment to our way of life' test. Apart from far happier people in our big coastal cities with less traffic chaos, fewer home invasions and other soft improvements to the way of life, this will help reduce budget deficits as many unsuitable immigrants require welfare. (Bravo John Stone and Judith Sloan for saying this in recent weeks.)
* Productivity policies need to be focussed on to allow Australia's incomes, including real wages, to rise without creating goods and services inflation or slowing jobs growth. This will also improve the budget balance and give Australia the opportunity to become a genuine global economic leader. (Please note with 80% of record jobs growth in government, it is no wonder that productivity is low. And where are wages growth highest - you got it, in the government sector, where productivity is near zero.)
Such policies need to await a reforming government, like the Hawke/Keating government and the Howard/Costello government. Sadly, no-one of the stature of key members of these governments seems to be on the horizon, so we shall stumble on with unhelpful economic policies and unhappy voters not knowing who to vote for.
A window into international view of Australian kulture is provided by an Indian Institute. (Something very different.)
The Sporting Life
South Efrica's test team has struggled its way to a modest lead in the second test. Clear mutual lack of respect bedevils the contest and relatively weak umpiring is not helping.
AFLW is a revelation, with the most amazing increase in skill levels after one and three quarter seasons of playing at a high level. Did Henry ever tell you about the Supercoach who decades ago revealed that he was coaching a women who was in his view capable of playing with the men at the highest level? In Henry's family, the daughter was the best footballer although not allowed to show up the boys once she was 10 or eleven years old.
Soon it will be AFLM time, and we are happy to have secured tickets to the opening game. This features Caaaarlton! vrs Richmond, and one expects the reining premiers to win easily. Sadly Caaaarlton!'s AFLW team is not doing so well, so it is implausible to shout 'give the gurls a go!".
Image of the week - courtesy The Economist