Sore Losers

[HAL]

Oh. One what?

[Kelpelican]

[Dr Alf Andrews]

Rising oil prices are John Howard's fault.

If there is an earthquake and a tidal wave, that will be John Howard's fault too.

If John Howard wants to claim the CREDIT for things that are completely beyond his control (i.e. low interest rates) then he can damn well take the BLAME for things beyond his control too.

You want to know why the Pies had such a shit season ... I can tell you, beyond all doubt.

It was JOHN HOWARD's FAULT.

[Blanch]

Alf, your post is hilarious until you realise how true it is.

[DidakinthePocket]

This is worth another topic!

Whilst we are at it,

Its the Howard Governments fault;

I broke up with my girlfriend
my neighour crashed their car
the price of eggs in london went up....

What else can we blame on them???? Honestly!

[Cannibal]

I have spent my entire working like in commerce and industry, first as an accountant, then in financial and general management, the last 12 years running my own consulting company in finance and IT. It is a complete myth that the Liberal Party is the better economic manager. Over the last eight years the Liberal Party have successfully created the impression that the recession of 1990 is clear-cut evidence of this and have equally successfully backed the Labor Party into the corner of denying Paul Keating's economic legacy, which is in itself the primary reason this country wasn't adversely affected by the Asian financial crisis of a few years ago.

Keating's recesssion was largely blamed upon the Reserve Bank continuing to increase interest rates to dampen a runaway economy in order to limit the adverse consequences of the rampant inflation beginning to impact on the economy, which itslef was caused by imports (the current account deficit was high but only a third of what it is now, evidence of the success of the Hawke/Keating changes). They misjudged the impact but, in fairness, no-one was reacting as expected to the increased rates and continued to borrow and borrow, as they were blinded by the benefits of asset inflation.

This is no different to the credit squeeze of 1960 when Menzies was Prime Minister and Holt the Treasurer. At that time, the economy was buoyant but the current account deficit growing, with the conseqences on inflation, so Holt brought in a range of deflationary measures ranging from increases in taxes to restrictions on bank lending. It is well known amongst economists that this was a classic example of the stop-go economic management typical of the Menzies era. This resulted in bankruptcies and rising unemployment, which in turn led Menzies to the brink of electoral defeat in the 1961 Federal Election, where his 32-seat majority collapsed to just one (also famous for Jim Killen's 110 vote win in Moreton which led to him saying Menzies called him "Magnificent", but which was itself a myth, as Menzies never rang Killen at all whilst the week-long count of votes progressed).

Similarly, the defeat of Malcolm Fraser's government in 1983, in which no other than John Howard was Treasurer, can be laid at the feet of their economic management. Again, a recession: low economic growth, rising unemployment, rampant inflation and high interest rates, no less! In 1977, Fraser announced tax cuts (an election bribe), then negated them in 1978 by announcing an income tax surcharge! In 1979, Fraser and Howard abandoned income tax indexation (designed to offset the impact of bracket creep). In 1980, Fraser rode the resources boom but still needed to apply a capital gains tax scare to ensure a win in that year's election. In 1981, Fraser and Howard encouraged a wages breakout through the Industrial Relations Commission then apllied a wages freeze late in 1982 to check the economic downturn. At the time of the 1983 Federal Election, which Fraser lost, income taxes were higher than in the Whitlam years, government spending had risen back to the same level and inflation had risen to 10%.

It was Labor under Hawke and Keating who (a) reined in the legacy of the $10 billion deficit left by Fraser and Howard (which would otherwise have resulted in much higher interest rates), (b) had the courage to make the most fundamental change ever to the Australian economy by floating the Australian Dollar in in December 1983, (c) bringing about financial deregulation (which led to the competitive pressures in that industry which themselves serve to hold down interest rates in the long term) and (d) brought in the Accord, which restrained wages increases which in turn led to low inflation but, more importantly, led to the trade-off of wages increases for superannuation, which will underpin lesser reliance on the State to fund retirements in the future. It was John Howard himself who said at the time (whilst Leader of the Opposition) that he agreed with all these policies and urged the Liberal Party not to oppose those policy measures just for the sake of doing so.

In 1990 and 1993, Labour won both elections, despite the 1990 recession, from which can be taken that the electorate was not willing to trust the Lioberal Party with the responsibility for economic management at those times.

In truth, there is very little difference between the economic policies of both parties. During the Hawke/Keating years, it was Labor who successfully won the middle ground, which Howard has for the last eight. In the face of ever-increasing globalisation, our economic fate will become more and more the result of external impacts. Responsibility for managing interest rates was placed in the hands of the Reserve Bank by Labor and their independence enshrined in law. If the Reserve Bank deems interest rate rises are necessary to off-set any external inflationary or recession-making impact, it will do so and it does not need to consult the government of the day to do so.