Malcolm Turnbull has taken exception to Kevin Rudd describing the current financial crisis as a "national security emergency" http://www.abc.net.au/news/stories/2008/10/19/2395100.htm?section=justin?

Is the government using the language of fear too much? Should they be using more measured tones? Or would this in effect understate the crisis and lead to citizens making bad decisions as a result?

Graham, I read the article you linked to quite differently to the way I've interpreted you comment.

I got the impression that Turnbull was objecting to the lack of debate of the measures rather than the severity of the issues.

Apart from that picking up on the questions in your post.

I get the impression that we are facing a very real risk of a major financial crisis and I'd prefer to see honest acknowledgement of that by political leaders

There is a risk that doing so will talk down the economy - a "60 minutes" segment last night with an economist talking of a 40% drop in house values won't do much to help house prices in the short term but I doubt overall that reporting on risks will create long term harm.

Rudd's package seems to be mostly targetted at those who will be hardest hit by a slowdown but will we need that 10 billion later to fix much bigger problems.

I'm guessing that for many (not all) at this stage of the crisis it will be a nice freeby rather than a make or break help package. Have we really hit the rainy day yet and will the money help stop it raining next year?

Is an extra $1000 in someones pocket just before christmas this year a more caring or helpful move than setting up a scheme which might lessen the chances of the loss of the family home when things get really tough?

TBC

R0bert

Part 2

Are there things we could do better? I doubt that there is one single answer and certainly some people really need the money now so the following are brainstorming ideas rather than realistic solutions.

- $10 billion towards low cost but functional emergency housing so that if we are caught in a global recession/depression beyond our control we lessen the numbers on the streets and if not we never have someone living on the streets because there is no alternative.
- $10 billion to kick start a publically owned bank which does not need to return a profit to shareholders during tough times and which is willing to find ways to help people keep their family home if things go bad. Not one to lend to those unwilling to help themselves but one supportive of those caught up in global events beyond their control.
- $10 billion to find ways of getting our manufacturing sectors going again or doing more onshore processing of what we export.

R0bert

Hi Robert, I grabbed the only quote from Turnbull I could easily find, but I based a lot of my post on what he said to Fran Kelly on Radio National this morning. http://www.abc.net.au/rn/breakfast/stories/2008/2395498.htm.

The “economic stimulus package” is aimed at indiscriminate spenders just before Christmas. After Christmas, the beneficiaries of Government ‘largesse’ will be broke and whining again.

Rudd has cynically handed out money to people who will blow it, stimulating the economy for a short time to make the Government look good.

Today’s cartoon of paramilitary looking police arresting a couple of oldies with Rudd proclaiming: “We have reason to believe you intend saving your bonus…” sums it all up!

Rudd the Dud is treating not only Parliament with contempt; he is treating all Australians with contempt

Graham, thanks. That gives a better coverage of his position. Turnbull seems to be criticising "sound byte" language rather whilst supporting truthful disclosure (if only I believed that any pollies really believed that). What I heard on the interview I liked.

R0bert

Mr Right I have my doubts about whether the $10B handouts will be spent. When consumers turn negative they tend to save what they receive, no matter what.

Mr Rudd is showing is is no different from Mr Howard again. Mr Howard used the threat of terrorism to gain a political advantage and Mr Rudd is using the financial 'crisis' to his advantage. Unfortunatley the public only know as much on both issues as the press feed them (usually not accurate).

It is hillarous to listen to economist and financial commentators who are trying to tell the public what is going to happen in the future, If they were so clever they would of told people to move their money from super funds 6 months ago and yet many still listen to these soothsayers. They have a lot in common with the gw high priests who are only ever wise after the events and yet are so confident with their predictions before hand. Thankfully their is One who knows the future and He is our only sure bet.

Rudd did say over a week ago it was like a security crisis.
And Turnbull has said it is not and that Rudd is over stating it.
Quite simple really a bad read from Turnbull this is far from over a post above talks of housing over priced by 40%.
Well some will fall more.
Regards and grateful thanks to the poster who said Rudd the dud!
Polling shows a different story, soon Turnbull must come to understand he has to say things that win voters other than those welded to his side.
Tell those who have already lost so much this is no crisis.

TWO OBSERVATIONS.

1/ Australia seems rather insulated from the factors which caused the massive devaluation of houses in America..i.e.. sub standard lending practices. So...why panic?

2/ The handouts show how shallow so many of us are (those who suddenly declared Ruddish to be 'GOLD'(en Calf?) with his new approval rating) for the sake of a small bowl of porridge.

GrahamY,

When you say, "Mr Right I have my doubts about whether the $10B handouts will be spent. When consumers turn negative they tend to save what they receive, no matter what", I wonder if you are making a common mistake of assuming there is a single entity called 'consumers'?

There is no single category labelled 'consumers' just as there is no single phenomenon called 'the economy' and no single thing called 'the market'. They are all made up of a complexity of elements and components.

Rudd was shrewd to accept the advice obviously offered to him by analysts to make the handouts available to those most likely to need to spend quickly (although some pensioners will squirrel away their bonus, just as some eligible to buy their first home will still not be in a position to do so).

As a pensioner myself and having just come back from an expedition to Coles and Safeway (I go to both to buy up specials where I can) I know that I will be having a more relaxed time this Christmas than last year. Our grandchildren will get something better than last years' meagre Christmas box and it will be nice to go on a beach holiday for the first time in years.

And if there's anything left in the kitty I might look at upgrading my antiquated computer and get a printer that actually works.

So when you say consumers tend to save I think you need to differentiate among that large class of people. Save? Not me. I want to enjoy what little there is left on this planet. And I don't think I'm Joe Malone.

"A national security emergency"?

Yes... I would agree with Kevin.

When money systems fail people get sacked and personal debts do not get paid and many folk get displaced from their homes and rented premises and the attendant social problems cause the crime rates to skyrocket.
...and guess what?
There arent enough police to deal with this one rather large financial crisis.
No one in the West was ready.

This is not the 1930's when people had respect for others, when people went to church, when women and children get into the lifeboats first.

Its a time of high social rebellion at the end of a long prosperous period thats gone on since the late 1950's. People are too used to having it so good.

Who knows what Kevin has also been fed by intelligence organisations regarding the slip into global unrest/terrorism?

Look at the spread of wars and conflicts? Theyre coming closer and closer.
And we're not ready.

No.
I wont say Kevin is out of line with "a national security emergency".

Law and Orderwise...the world is falling to pieces.

We need to get ready.

Kevin certainly is not inspiring confidence.$10 billion is less than 1% of GDP.It will have some short term effect but the real game is keeping people spending so they will keep their jobs.In the last recession the Keating Govt denied the reality of a recession until it was nearly over.Now our Govt threatens doom and gloom before it has even really begun to bite.Some commentators are already making predictions of 200,000 jobs being lost.Not a good confidence booster.Are they preparing us for something really nasty?

The US is running the risk of blood in the streets since they have the most armed civil population on the planet.Putting millions of people out of their homes is a recipe for civil unrest.It is better to keep people in housing paying at least something and them keeping their jobs.

Polycarp no offense meant but you showed a total lack of understanding in that post.
This believe me is a crisis, and Australian homes are more over valued than American bet on it.
Rudd knew giving the money to pensioners would do two things.
As the post above says it will be spent.
Some will have a better Christmas some may get the fridge or washing machine they need.
And in spending it the economy has a chance of not slowing too fast.
Those polls David surely you know they are not driven by handouts?
They are clearly a vote of confidence in the way he is handling this crisis.
If in doubt read articles in such as the Australian fully supporting his actions.
This is not a short Sharpe recession, this is bigger than most think, unless the world can find new ways of controlling debt and over spending we are in for bad times.

This is interesting.

R0Bert, that economist on 60 minutes was Steve Keen. The same Steve Keen that wrote an article published on OLO almost exactly one year ago. BEFORE the first downturn in November.
http://www.onlineopinion.com.au/view.asp?article=6528&page=1
Back then the article only generated 16 comments, some are highly amusing to read now.

As for runner denigrating the prophetic powers of economists, that is highly amusing. This economist got it right, because he had good data. In fact this economist has saved me at lot of money so far because I actually read the articles here (the interesting ones that have more than just opinion in them anyway) and I moved into cash last year. You would have too, runner, if you had read his article and understood the implications. Thanks OLO, you have at least helped one Australian family.

There's none so deaf as those that will not hear.
And Prof. Keen is now treated as a prophet.
I'd listen to him if I were you.

Hi Graham,

I would agree with Kevin Rudd for the financial crisis to be treated with the importance of a national security issue. While the property market might be a lesser risk, there need to be an impact assessment on three key issues:

- Exports: the fact that the US, EU and many other Aussie exports markets going into recession means there will be an impact on our exports, SME markets, jobs, etc.

- Travel and Tourism: the impact on travel and tourism to and from Australia in a global recession.

- Foreign investment: The impact on investment market to and from Australia.

While I believe the impact can be serious it could also reveal new opportunities for us.

What I find worrying is the level of Australian public debate on this issue in comparison with the US and the EU. I am overseas at the moment and whenever I check Aussie media it seems we are still covering it as something happening overseas.
Peace,

Pensioners and carers big winners in Rudd's rescue package.

Ok ,but Rudd had to deal with that
anyway and hes pretty much copied
what Howard did pre Christmass.
Then again theres nothing unusual in that.

Dont forget this is the same man
who wanted to stop carers payments
all together just a few weeks
after being elected but got caught out.


They 'forced' neighbouirs of people
on pensions to spy on them.
Do you all remember that.

Now does that sounds like a PM
who cares about pensioners
and carers I ask you.

He STILL has not addressed the
issue of single pensioners remember.

Never mind I am sure everybody
will be pleaed to know we waisted
more tax payers money in the senate
making sure the size of serving
at Parliment house canteen were ok- For God Sake at this time of national sercurity to quote him.

Rudds Minister for enviourment is the
closest thing to a National Sercuity Emergency.

On 4 corners she disclosed she had no idea
our largest water catment was purchased
by an off shore company.?

Jenny Wrong certainly got that Wong.
Not one person from the Federal
Government attended the meeting
that sold off our water supply.

We cant blame Rudd for the worlds mess. However had been concerned about National sercurity he had his chance when he was Shadow Minister at the AWB enquiry.

His duty WAS to inform people about the other activities AWB were involved in.

AWB Landmark still operate in the same manner in live exports not just wheat.




You dont talk UP a national sercuity problem putting fear into home buyers and investors if you smart. A PM job is to put peoples mind at ease not provide the last supper.



+ whos going to feeed us Ms Wong +China?

Oh, btw do you think theres any connection between the Uk company and China that purchased our water. Just asking?

There is one question I have to pose again.Since the mid 90'S with a pop of 18 million we have now virtually doubled our GDP to $1.1 trillion and yet ordinary folk are worse off than the 80's. The US has a similar scenario.They too have a shrinking middle class and a pop who have both parents working long hours just to pay the mortage.

The debt trap it seems was a snare to enable those at the top of the food chain to take the cream and run.The tax payer it seems will again pick up the bill for their excesses.

I suspect that the bailout will only prolong the agony,since the preditors will use this time to play the market and draw more tax payer funds into their web of deceipt.

Our earnings to debt ratio is far higher than the Great Depression.On the other hand,we in Australia have a lot of savings in the form of super,however much of this is invested in the banking/share market bubble.
I don't like the notion of interesting times.

don't concern yourself with these deep matters, uncle rudd will protect you.