Whatever Wayne Swan’s faults, bombast isn’t one of them. Swan’s determination to remain downbeat about Australia’s economic prospects continues to ield some of the more peculiar interviews in recent Australian political history, in which he is repeatedly urged by journalists to admit that the economy is going well but always manages to find the cloud within the silver lining.
This morning he was grilled by the ABC on Access Economics’s latest Business Outlook, in which the so-called Treasury in exile declared us through the worst of the recession with only collateral damage, partly thanks to the Government’s stimulus package, and predicted a much lower peak in unemployment than the Government officially anticipates.y
As we’ve pointed out before, Access Economics’s forecasting record isn’t the greatest. We can forgive misjudgements like its comment in September 2007 that “Access Economics does not expect the US credit crunch and the US slowdown to develop into worldwide weakness.” Everyone else got that wrong too. But it’s not much more than six months since Access warned of a horror run for retailers, even as the Government’s first cash splash was hitting consumer pockets. And it was only a couple of months ago that Access predicted 8.5% unemployment next year.
Why the Treasurer is being quizzed about this firm’s forecasts is a mystery.
This is not to suggest a problem with Access Economics so much as with the extent to which economic commentary in Australia is based on numbers of momentary significance, numbers which are loaded with meaning in the few minutes after their release and then promptly forgotten. The numbers may be new data from the ABS or another round of predictions from Access, but both briefly drive the media cycle and then vanish completely.
Given the comprehensive failure of the economics profession over the last 12 months, it might be time to ease up on the pointless fixation with digits which, given their real-world accuracy, might as well be randomly generated.
Crikey is committed to hosting lively discussions. Help us keep the conversation useful, interesting and welcoming. We aim to publish comments quickly in the interest of promoting robust conversation, but we’re a small team and we deploy filters to protect against legal risk. Occasionally your comment may be held up while we review, but we’re working as fast as we can to keep the conversation rolling.
The Crikey comment section is members-only content. Please subscribe to leave a comment.
The Crikey comment section is members-only content. Please login to leave a comment.