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The Forum > Article Comments > Fact-checking Australia's likely next PM > Comments

Fact-checking Australia's likely next PM : Comments

By Alan Austin, published 29/7/2013

Mr Abbott's address to the Australia-Israel Chamber of Commerce in Melbourne on Monday of last week contained about twenty readily identifiable falsehoods.

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Hi Rhian,

Re: “No, I would not agree 2.5% is a good result comparatively.”

Depends who we compare with, doesn’t it?

Most economists would regard Canada, Germany, Austria, Denmark, Japan, Luxembourg, Netherlands, Finland, South Korea, Ireland, France and the UK as 12 comparable modern consumer societies.

No?

Their tradingeconomics average is negative! Australia: +2.1%.

So depends on comparisons.

Re: “Not only is it the lowest in decades, it's also lower than in Australia even at the height of the GFC.”

Do you mean “height” or “onset”, Rhian? For many nations, probably including Australia, this is the height now. It’s a long way from over for much of the world.

Re: “It may be better than in Europe, but we know much of Europe is a basket case.”

Correct. No-one is comparing Australia with Italy, Portugal, Spain and Greece. But the robust European economies – Germany, Denmark, Norway and Switzerland – are also struggling with sales. As are several non-European OECD countries – South Korea, Japan and Mexico.

Re: “It was you who raised them [retail sales] as evidence of Australia’s supposed strong economy. I thought it relevant to point out how weak they are.”

Hmmm. Yes and no.

Raised only to show Australia has been travelling better than Singapore through the GFC. Singapore had nine decreases and only three rises in the last 12 months. Australia, in contrast, had 12 positives.

Re: “How weak they are”.

Well, compared with comparable economies, positive 2.6% is not week at all, Rhian.

Denmark has had 15 consecutive negative months. That’s weak.

Re: “I have no idea what Abbott’s advisors tell him [on productivity], but it’s a bit rich for you to castigate him for quoting numbers that were accurate and the most “recent” available at the time he used them.”

Not at all, Rhian.

He has continued to lie about Australia’s productivity, long after the upturn became apparent.

Refer item 7 in the original article. That was two weeks ago.

Maybe he’s unaware of the recent turnaround. Don’t know. But he is lying and he should stop.

Cheers,

AA
Posted by Alan Austin, Thursday, 8 August 2013 10:31:41 PM
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Alan,

Everytime, you feel the need to cherry pick the figures. The government figures show that NET debt when Hawke took over was about 7.5% of GDP and was 18% when Howard took over.

It would appear that the mainstream media tells far fewer porkies than the unscrupulous contributors to New Matilda and Independent Australia.
Posted by Shadow Minister, Friday, 9 August 2013 2:34:29 PM
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Hi Alan

Item 7 in your articl emade no reference to falling productivity, but spoke of government’s failure to implement productivity-enhancing reforms. You conflated this in this forum with the older reference to falling productivity in this forum to imply that Abbott lied. He didn’t.

Re height of the GFC. It was a global crisis. Global GDP contracted in 2009, but rebounded in 2010 and has grown since. Europe may still be in the doldrums, but the global economy has recovered.

You say “most economists would regard Canada, Germany, Austria, Denmark, Japan, Luxembourg, Netherlands, Finland, South Korea, Ireland, France and the UK as 12 comparable modern consumer societies.”

Similar consumer societies, yes. Similar economies, no. Similar economic conditions, definitely no.

Australia’s terms of trade have surged to their highest level in more than 100 years. Of your comparators, only one (Canada) is a major commodity exporter. Even in Canada the rise the terms of trade in the 2000s was not as strong, and the post-GFC rebound was not nearly as strong, as in Australia. Canada’s largest export market is the USA, which spearheaded the global recession. Nine of your 12 comparators are in Europe, where the economic malaise of major countries quickly spreads to others. Europe’s largest trading partner is Europe.

Australia’s largest export market is China. None of your comparators has the advantage Australia has enjoyed of its largest trading partner recording real average GDP growth of more than 8%pa and import volume growth of more than 10%pa in the three years after the GFC. Between 2006 and 2012 Australian mining investment as a percentage of GDP rose from 2.1% to 6.3%; the total value of mining exports rose by 13.4% pa; and total exports to China rose by 27.7% pa (258% in total - now that truly is a “staggering” growth rate!)

Almost all your comparators had significant financial sectors exposure to the toxic credit instruments whose implosion precipitated the GFC. Australia had almost none.

So no, I’m not impressed that our post-GFC economic performance is better than the comparators you selected. So it should be.
Posted by Rhian, Friday, 9 August 2013 3:37:46 PM
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Hi Rhian,

Re, “Item 7 in your article made no reference to falling productivity, but spoke of government’s failure to implement productivity-enhancing reforms.”

Correct. Mr Abbott said this on July 22:

“Unfortunately, we’ve heard this [Government commitment to boost productivity] from Mr Rudd before, indeed on numberless occasions since 2007 but he’s never actually taken the steps needed to convert aspiration into achievement.”

This is clearly the opposite of the reality:

http://www.pc.gov.au/

Productivity has been a major Government focus with results at last.

No-one expects Mr Abbott to commend the PM for his courage and vision, and congratulate him on the effectiveness the ABS data now confirms.

He has the right to remain silent.

But if he deliberately speaks the opposite of the truth, he should be called the liar that he clearly is.

Labour productivity improvement first became evident in early 2011. That rise has continued unabated. Multifactor became evident in mid 2012.

So denigration since then has been unwarranted. Yet Mr Abbott persists.

Re: “It was a global crisis. Global GDP contracted in 2009, but rebounded in 2010 and has grown since. Europe may still be in the doldrums, but the global economy has recovered.”

Only if we define ‘crisis’ as severe reversal of GDP growth, and only if we regard ‘recovered’ as a return to positive GDP growth.

As discussed earlier, there are other determinants. From Monday: “The critical outcome is not just the debt they emerged with, but overall economic health – income, growth, national wealth, jobs, inflation, tax rates, productivity, savings, terms of trade, credit ratings. On these, Australia is top of the world – by a mile – and streaking further ahead.”

So those economies still suffering badly from high unemployment, low company profits, bankruptcies, high taxes, inflation and other ills are still experiencing the global financial crisis – even if their GDP growth is now positive.

These are many in all regions.

And, indeed, many still have negative GDP growth, especially in Europe, parts of Central America and much of Africa.

The GFC has a way to run yet, it seems.

Cheers,

AA
Posted by Alan Austin, Friday, 9 August 2013 8:23:20 PM
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