Finally, the numbers go Malcolm Turnbull’s way.
For months the Opposition has been attacking the Government’s first stimulus package, which it (in hindsight, foolishly) initially supported, on the basis that it had no effect. Without evidence, the argument could have gone either way. But bit by bit, the data dripped in, showing a surge in retail and construction generated by the December handouts and the First Home Owners’ Grant boost. The Opposition tried to spin and twist the figures but they were increasingly clear.
As late as yesterday, Turnbull was still at it, saying “there is no evidence that the stimulus package, the cash splash from December, has had any positive effect beyond a slight increase in retail sales”. He was beginning to look silly.
Now, though, he has a basis for his argument that the Government’s efforts to stimulate the economy aren’t working. He can point to the cold hard fact that the economy shrank by 0.5% in one quarter. It would have shrunk even more if not for a strong farm performance.
The Government has a number of responses. For a start, the “cash splash” as the Opposition insists on terming it didn’t arrive until mid-December, near the end of the quarter. The validity of that argument will be tested three months from now when we get the March quarter figures. It can also argue that it would have been worse but for the stimulus package. It can point to the fact that the main reason for the decline is the fall in inventories. Moreover, unemployment is yet to really rise significantly; however bad the economy might be, most employers appear to be hanging on to their workers.
And of course, an annualised contraction of 2% is the sort of number the Americans, the Japanese and the Europeans would kill for.
All fair points. But none of that level of detail will cut through. Turnbull only has to say “-0.5%”.
The Government has been adept at talking directly to voters, cutting through the political and media chatter. Rudd specialises in it. Malcolm Turnbull and the Coalition have focussed on political games and point-scoring that might work in Parliament but have no cut-through to voters. Worse, they have allowed Rudd to craft the public perception of them as irresponsible opportunists and right-wing radicals.
-0.5% now gives Turnbull some cut-through of his own. The figure will resound with voters, and probably cause a further collapse in confidence. Those who criticised the fixation on whether the number was negative or positive as Micawberish — basically, Terry McCrann — miss the point utterly: we’re in a vicious circle where bad news will further undermine confidence, leading to further bad news. The plus or minus sign in front of the number is critical, whether that’s rational or not.
Turnbull, as long as he isn’t seen to be exploiting the bad news, can now stick to his “I told you so” routine.
The Government may now be ruing that it did not try to get even further ahead of the curve and get a stimulus package off the ground earlier than December. But if the next quarter returns to positive territory, it will look like the Government got its timing just about right. Meantime, it will face a reinvigorated Opposition, which isn’t a bad thing at all given their performance lately.
One other thing: who predicted a contraction of this magnitude? Commentators, economists and analysts don’t seem to have any more of a clue than the rest of us about how bad things are. Something to bear in mind as we go further into the unknown.
“Finally, the numbers go Malcolm Turnbull’s way”.
Bernard complimenting Turnbull, no matter how begrudging and small-minded the homage, is a very very significant event.
Why?
In the first instance Keane is implicitly criticising his beloved Divine Leader: The Kruddmeister. Circle the date in your diaries.
Secondly, Keane is implicitly admitting that he may have got wrong when he informed us that Turnbull had just committed political suicide in choosing to vote against the second $42 billion “stimulus package”.
Mind you, Bernard has admitted that he had got it wrong before. So I must believe that he shall explicitly admit it at some point in the future; so keep your diaries open on that score.
Peter, those ‘smart arse financers’ living in wrongness all this time are still trying to tell everybody how to do it which is the psychological classic state of those whom don’t get it. When is a joke a joke to the death?
George is singing my song but I think ‘George’ is a pseudonym for the head of treasury.
Forgotten is that cute piece that used to continuously clog all the media and was delivered by that exciting and extraordinary thing/bloke whom/which was the closest that Australia ever came to producing as its own real live and oh so sensational war criminal (by attitude more than by deed unfortunately for him) yes that sexy bit that loved getting his jollies off behind his Bush, J How aah dam what’s his name – the piece …… “labour will always deliver higher interest rates than me” (@ 3 to 4 % – another joke) that’s why Australia continues to stay laughing, all these unreal jokes that walked around as the real thing.
The greener side of trueblue Heaven? Leftwing Aussie-Irish Catholic
It’s not absolutely necessary to be leftwing to support Rudd but it helps.
What is absolutely necessary is ignorance and/or sh1t-fer- brains.
How do you grovel?
“corpus delicti”?????????
You saw it with your own eyes! A PURPLE shirt!!!!!!!
…..besides do really want to catch Bernard and The Krudd: ‘flagrante delicto”?
“Negative growth”???? The opposite of growth in an economic sence would be contraction or recession. Call it what it is. If you die, is that negative life?
Why is it so bad to have a contraction in the economy? We need to wipe out the excess of which we have all been guilty.