The peddlers of recession p-rn have been hard at it in recent weeks, barely slowed by the traditional Yuletide excess. Barely a day has gone by without some bank, investment analyst, economics commentator or ratings agency offering their own special index of misery to illustrate just how stuffed we are, or will be later in the year.
Like real p-rn, of course, recession p-rn doesn’t serve much actual purpose except to get people hot and bothered, but it’s tremendously popular. Today The Daily Telegraph site even put a credit crunch story about James Packer in its scrollable gallery, usually reserved for celeb snaps and T&A shots. A “Recession rippers — Aussie babes looking for work” gallery surely can’t be far away.
Admittedly there are those for whom predictions of gloom and doom aren’t about the rush of contemplating just how awful everything is going to get. For some, the looming downturn is a personal vindication. Steve Keen has complained in Crikey of being treated as an Eeyore, but really he is more a Biblical figure than a resident of the Hundred Acre Wood, having warned for years about the dangers of debt with the fervour of an Old Testament prophet. Every new piece of bad news is, for Keen, who last week upgraded his predictions of doom to “worse than the Great Depression“, evidence that he was right and the rest of us sinners, who have refused to repent of our debt-laden ways, wrong. Ed Shann is another, predicting last Monday in the AFR that “Australia is about to suffer one of the sharpest drops in income in its history.” Shann has long argued that Australian house prices are set for a fall, and finally he expects to be proved right — in a big way.
There’s a puritanical air to such jeremiahs, condemning the rest of us for having it too easy for too long, and while they may not take any pleasure from our fate, there’s a grim satisfaction for them in being proved right, so they think. And while they may differ fundamentally from those who would re-regulate everything in sight and re-establish government at the centre of the economy, they have rather a lot in common with many on the Left who are taking inordinate pleasure in seeing capitalism succumb to its own failings.
But most commentators aren’t of that ilk. They’re just trying to make a buck in these tough times, and recession p-rn is what sells best at the moment.
So along comes Access Economics today, with a new “Business Outlook” perfectly timed for the media cycle. “Batten the Hatches” the press release cries, before retailing a litany of predictions about the doom ahead. As always, Access Economics’s release was embargoed, not for any valid commercial reason, but simply because it adds to the sense of newsworthiness. Timed for bored weekend hacks preparing Monday’s newspapers, the release was a gift for them, complete with snappy lines like “the Federal Budget is buggered” and “NSW is drowning, not waving.”
Clever stuff, and Access was rewarded with strong coverage in the broadsheets this morning, leading ABC Radio news and guaranteed follow-ups when journalists raised it with Wayne Swan. After all, it’s Access Economics, “known as Australia’s ‘Treasury in exile’ for the large number of ex-Treasury officers” as The Age’s Peter Martin pointed out.
There’s a little bit of intellectual sleight-of-hand in the respect accorded Access by the media, because the work of serving Treasury officers is met with scepticism and dispute from the media, but ex-Treasury types in the private sector don’t seem to get anywhere near as much questioning. But as Martin noted, Access has changed its tune rather dramatically with its latest report, having hitherto been upbeat about Australia’s prospects.
Indeed, Access’s predictive record is pretty ordinary. They’ve been calling the end of the resource boom for years, and sheer persistence should finally see them get it right in 2009. They predicted that the NSW economy was about to recover in mid-2007, right before it seriously went into the toilet at the hands of Morris Iemma. And less than a year ago its pre-Budget outlook was headlined “Horror Budget or horror interest rates” on the basis that the Australian economy was running so hot the Government needed to savagely cut expenditure or watch the Reserve Bank jack up rates.
That, needless to say, didn’t quite transpire.
Not that Access was alone in missing the financial crisis. But their predictions about unalloyed gloom should be considered with the same scepticism that their predictions of uninterrupted growth merited. An embargoed press release and some nice lines don’t make up for being badly wrong. And however flashily it’s presented, p-rn is still just p-rn.
If this is the quality of your journalism, I think I’ll stay a squatter.
Who is Andrew Peter Thompson? I appear to be missing something …
I can’t stand all these self-appointed ‘experts’. I moved all my super into cash over 12 months ago on the simple philosophy that what goes up for a few years must eventually come down with a bump as has always happened in the past. I have been to several financial advice seminars over the last few years, as I am nearing retirement, and not one of them said to think about the cash option but merely advised to leave your super in the markets to reap the high returns. Now the downturn has happened they are still saying leave it in the markets or you will miss the recovery when it happens. Why pay enormous fees for ‘experts’ to tell you to do nothing no matter what the circumstances? People should learn from history not ‘experts’.
When you’re buggered you’re finished. So clever it aint. Battle on regardless, the world not over yet!
I have to disagree with this article. Most of economic data and commentary has not really plunged totally into the gloom and doom. To become an economic manic depressive you need to do it properly. Armageddon, wastelands…a complete meltdown of capitalism!
This stuff coming out is fairy floss, how many times to we hear “The domestic economy is set for a comeback in the fourth quarter”
Bah! Bollocks!