Budget 2012, travel losers

[eastwest101]

- the Coalition lost the election
- Rudd (as a personality) won the election due to being charismatic and appealing to a large portion of voters (for the love of god I still don't understand why IMHO), and by selling himself as Howard-lite. Voters weren't interested in major change, just a "refresh" as IT folk would say (a luxury voters are seemingly prepared to take when the economy is traveling well)
- the ALP as a party/team was in no way ready to govern
- Rudd's gloss started to come off when voters started to suspect that perhaps it was all just marketing rhetoric and there was a lack of substance behind "Kevin07", although this never got tested
- the ALP "post-Rudd" has revealed what the Party really was and stood for and the electorate doesn't like it. Just didn't quite reject it resoundingly enough in 2010, and every step since has just reinforced to the electorate that they made a mistake in 2007.

Interestingly - for some reason - a lot of middle-ground voters absolutely "hate" the government, but haven't "warmed" to Abbott on a personal level even though they embrace his policies. No doubt the internal party pollsters on both sides are spending big $$$ examining this mindset.

Getting back on topic though - I will be surprised if this budget delivers a big boost to Labor as I think people have stopped listening - just as they did with Howard - albeit on a much larger scale now.

That is a pretty elegant summary of things there. I think the swinging voters are having a dose of "buyers regret" since 2007.

 

[Moody]

My take on the latest Labour era (that is swiftly coming to an untidy end) :-

The electorate finally tossed out Howard when he started habitually lying to them about issues they cared about (unlike "Children Overboard" etc.). Rudd made a promising start in putting some soul back into the nation (National Apology, Ratifying Kyoto, etc.) but things started going off the rails when he took on some very greedy people with very big pockets. He then also bottled it on climate change when the Coalition lurched to the extreme right and replaced the monarch (pun intended) with the court jester. The final nail in the coffin was that he is a complete prick to work with, so as soon as he was vulnerable the party tossed him out.

Enter Gillard who was an impressive parliamentary performer and solid deputy, who then proved to have been promoted one time too many. She listened to the spin doctors when she shouldn't have and then didn't when she should. In the end all of the good work of the past three years (e.g. dodging the GFC bullet that the Coalition wanted to take between the eyes like a good grunt) looked to be going down the toilet, but Abbot snatched defeat from the jaws of victory and they got another lifeline.

Did they learn from their mistakes - did they bollocks!

The past couple of years guiding significant legislation through an absolute political minefield should be a feat to be proud of, but continuing leadership squabbles and various other PR disasters have led a slide in the polls. Considering the calibre of the opposition (which is simply appalling) this is particularly ignoble.

So for once I find myself agreeing with the baying shock-jocks and their self-interested sycophants. Let's have a coup now and toss Gillard and her rabble out.

... as long as we can do the same to the new fools once their popularity drops below 50%. I give them 6 weeks.

 

[Moopere]

... as long as we can do the same to the new fools once their popularity drops below 50%. I give them 6 weeks.

Particularly relevant if we choose to become a polls driven nation, as recent posts appear to be promoting (most Australians this and the majority of Australians that...)

 

[dfcatch]

My take on the latest Labour era (that is swiftly coming to an untidy end) :-

The electorate finally tossed out Howard when he started habitually lying to them about issues they cared about (unlike "Children Overboard" etc.). Rudd made a promising start in putting some soul back into the nation (National Apology, Ratifying Kyoto, etc.) but things started going off the rails when he took on some very greedy people with very big pockets. He then also bottled it on climate change when the Coalition lurched to the extreme right and replaced the monarch (pun intended) with the court jester. The final nail in the coffin was that he is a complete prick to work with, so as soon as he was vulnerable the party tossed him out.

Enter Gillard who was an impressive parliamentary performer and solid deputy, who then proved to have been promoted one time too many. She listened to the spin doctors when she shouldn't have and then didn't when she should. In the end all of the good work of the past three years (e.g. dodging the GFC bullet that the Coalition wanted to take between the eyes like a good grunt) looked to be going down the toilet, but Abbot snatched defeat from the jaws of victory and they got another lifeline.

Did they learn from their mistakes - did they bollocks!

The past couple of years guiding significant legislation through an absolute political minefield should be a feat to be proud of, but continuing leadership squabbles and various other PR disasters have led a slide in the polls. Considering the calibre of the opposition (which is simply appalling) this is particularly ignoble.

So for once I find myself agreeing with the baying shock-jocks and their self-interested sycophants. Let's have a coup now and toss Gillard and her rabble out.

... as long as we can do the same to the new fools once their popularity drops below 50%. I give them 6 weeks.

I would agree with a lot of what you have said (although the GFC management IMHO was more to do with dumb luck and cash in the bank than good management). Although the swift cash guarantee was very necessary.

I do however disagree on the electoral importance of the National Apology and Kyoto. Those who truly cared about these issues (voters to whom it was a vote-changer) were/are already ALP voters. I don't believe that those issues change governments. (not between ALP and Coalition anyway... Perhaps between ALP and Greens. ) personally - I think the relevance to voters of these issues is over-stated.

To the average swinging voter - good stable times (such as those enjoyed in 2007), do allow the luxurious indulgence in such issues.

When times are tougher - mainstream voters do not rate issues such as apologies, Kyoto, gay marriage or similar as vote-changers. They care about whether they can pay the mortgage, have a job next week, support their kids etc etc. That's why election issues don't always follow opinion polls and focus groups on any particular issue.

The environment is a great example - apparently in 2007 everyone cared about reducing emissions - one of Kevin's platforms. In 2012 - it seems the vast majority don't care so much about it when they actually see the supposed solution.

Mainstream voters don't indulge in peripheral issues when things aren't going well.

Whether Rudd was a phoney or not (my own views aside), at least at the time people believed that he would manage the important issues.

The fact that the Coalition is not on their best game but yet continue to trump the Government, speaks volumes for how much the current mob are out-of-touch with the majority (regardless of our tribal leanings).

I actually hope the ALP gets their act together - as much as I want to see them out of office... It's no good for the country if they are decimated.

 

[dfcatch]

Particularly relevant if we choose to become a polls driven nation, as recent posts appear to be promoting (most Australians this and the majority of Australians that...)

Sorry my friend - that's how democracy works. It's a majority rules society.

And without being rude - but you would no doubt not be making the statement you did if the "majority view" happened to match your own.

I don't hide my biases, but I do try to keep my analyses even-handed.


The short answer to your comment is "yes"

 

[dajop]

I I actually hope the ALP gets their act together - as much as I want to see them out of office... It's no good for the country if they are decimated.

I think the country - and the ALP (who probably will be decimated at the next election) - would have been much better served if Liberal Party had formed a minority government. I wonder if the popularity of Liberal party would have gone down the plughole as well, after all it is extremely difficult to have to do deals with small parties/independents and govern in the interests of all (perhaps unless it was the Australian Democrats who , before they lurched too far to the left, seemed responsible enough - eg on the GST, and actually probably even saved some governments from themselves at times).

Sorry my friend - that's how democracy works. It's a majority rules society.

It is, but not based on week by week polls. Part of the big problem of this country is we are governed by short term policy thinking focussing on re-election (and marginal seats). The shorter the term between polls, and ability to bring down a government based on opinion polls can only damage the long term interests of the country as a whole, as it would focus the government even more on the short term.

If I were to offer my opinion, the problem with national politics is that it has become too extreme - ALP too far to the left under Gillard, Liberals/Abbott too far to the right, where has the influence of all those in the centre gone ? But paradoxically in some instances more centrist types are dominant - Victoria comes to mind - there didn't seem to very much difference when government changed from one party to the other.

 

[Moopere]

Sorry my friend - that's how democracy works. It's a majority rules society.

Ah yes, but not polls based, excepting that the compulsory vote at election time is a sort of poll

Polls you see in the media and elsewhere are based very often upon several hundred respondents, perhaps a thousand or so in some circumstances. Entirely different animal to a compulsory vote or a plebiscite.

And without being rude - but you would no doubt not be making the statement you did if the "majority view" happened to match your own.

Yep, I would. I find it funny when polls or posters in forums use language like "Most Australians want..."

Very few polls one sees in the media (for example) have anywhere near enough data points to be statistically relevant or to make wide sweeping claims about what the population as a whole actually wants.

 

[amaroo]

I think the country - and the ALP (who probably will be decimated at the next election) - would have been much better served if Liberal Party had formed a minority government. I wonder if the popularity of Liberal party would have gone down the plughole as well, after all it is extremely difficult to have to do deals with small parties/independents and govern in the interests of all (perhaps unless it was the Australian Democrats who , before they lurched too far to the left, seemed responsible enough - eg on the GST, and actually probably even saved some governments from themselves at times).

Australian Democrats - RIP....bet they would like to change some of those decisions.

ALP are in Green & Dangerous waters.....if they don't change they will follow the DEM's into political oblivion.

I'm a true blue ALP hater however, I hate the greens more:mrgreen:

 

[dfcatch]

Dajop - quick question?

Why do you define Abbott as right-wing?

Many of his policies are in fact very small-l liberal, paid parental leave is an example that comes to mind.

Most of his critics are in fact right-wing liberals who think he should be promoting more free-market ideals.

The problem with making a liberal party assessment on the budget is that it's no longer a simple comparison of wet vs dry economics.

And I would suggest the same dilemma faces the government, although tax and spend is the natural political view of Swan. But I do wonder how it sits with the likes of say Shorten (should he become leader).

I am however disappointed that Swan didn't announce a Bossreggie Lunch Bonus in the budget! I would very gratefully accept such a handout

 

[dfcatch]

Ah yes, but not polls based, excepting that the compulsory vote at election time is a sort of poll

Polls you see in the media and elsewhere are based very often upon several hundred respondents, perhaps a thousand or so in some circumstances. Entirely different animal to a compulsory vote or a plebiscite.




Yep, I would. I find it funny when polls or posters in forums use language like "Most Australians want..."

Very few polls one sees in the media (for example) have anywhere near enough data points to be statistically relevant or to make wide sweeping claims about what the population as a whole actually wants.

Sorry - my bad, misinterpreted the comment.

Agree wholeheartedly with your comments here


Ps. Sorry for post-padding, no multi-quote on the iPhone.

 

[eastwest101]

Agree with nearly all your points Moody except:

My take on the latest Labour era (that is swiftly coming to an untidy end) :-

... but things started going off the rails when he took on some very greedy people with very big pockets.

Actually - Rudd believed Swan's assurances that the State governments and the mining industry were OK with the RSPT. This was his mistake.

He then also bottled it on climate change when the Coalition lurched to the extreme right and replaced the monarch (pun intended) with the court jester. The final nail in the coffin was that he is a complete prick to work with, so as soon as he was vulnerable the party tossed him out.

Agreed Rudd should have either called the greens bluff of blocking the CPRS and gone to a double-dissolution election which he could have won, but its hard to see what he could have done with the greens blocking the CPRS if the greens held the balance of power in the senate.

Enter Gillard.... In the end all of the good work of the past three years (e.g. dodging the GFC bullet that the Coalition wanted to take between the eyes like a good grunt) looked to be going down the toilet...
Did they learn from their mistakes - did they bollocks!

If coalition were in government in the GFC their response may have been about the same as it was treasury's advice. Maybe slightly less profligate than Swan's throwing away money on the streets but China, good banking system and the surplus would have got the economy through anyway, no matter who was in government.

 

[Moody]

If coalition were in government in the GFC their response may have been about the same as it was treasury's advice. Maybe slightly less profligate than Swan's throwing away money on the streets but China, good banking system and the surplus would have got the economy through anyway, no matter who was in government.

That's not what the Coalition said they would have done, but no doubt they were lying, eh? Hypothetically if they had been in charge and had rolled out a much smaller stimulus package as planned, then Australia would have slipped into recession. This is not idle conjecture - it is as close to certainty as you can get. In fact a few economists claim that while we did not officially cross the line into recession - it was about as fuzzy as the current "surplus".


But imagine what being told we were in recession would have done to public and business confidence. Once that genie was out of the bottle it is very hard to get your mojo back (just look at the rest of the developed world), and we would likely have a one-speed economy at the moment. [Everything not resource-based being dead in the water].


Anyway - I just pray that the coalition are lying, because if they follow through on all the current "promises" we will be looking back at this time a little more fondly than we would imagine.

 

[dfcatch]

...we will be looking back at this time a little more fondly than we would imagine.

The Coalition would have to win, and then spectacularly reveal themselves as the Greens in disguise by revealing their Mission Impossible-style masks in order for that to happen.....

 

[medhead]

Well the savings are a mirage like so much else. Just like how my voluntary super contributions will earn them a whole lot more with a 30% tax, but in reality as far as I understand it there won't be any point in my doing it and they won't get anything as people pile into negatively geared investments instead.

Sorry the super thing just does not work like that. One can either make concessional contributions, from money that hasn't been taxed yet, or non-consessional contributions, from money that has been taxed already.

There is a $25000 cap on concessional contributions. For someone earning $300,000 the 9% super guarantee already exceeds 25,000 so they can't any extra voluntary concessional contributions. So extra tax on the 9% contributions.

Non-concessional contributions are not tax in super, as that would be double taxation.


Sent from the Throne

 

[Deleted member]

My take on the latest Labour era (that is swiftly coming to an untidy end) :-

The electorate finally tossed out Howard when he started habitually lying to them about issues they cared about (unlike "Children Overboard" etc.). Rudd made a promising start in putting some soul back into the nation (National Apology, Ratifying Kyoto, etc.) but things started going off the rails when he took on some very greedy people with very big pockets. He then also bottled it on climate change when the Coalition lurched to the extreme right and replaced the monarch (pun intended) with the court jester. The final nail in the coffin was that he is a complete prick to work with, so as soon as he was vulnerable the party tossed him out.

Enter Gillard who was an impressive parliamentary performer and solid deputy, who then proved to have been promoted one time too many. She listened to the spin doctors when she shouldn't have and then didn't when she should. In the end all of the good work of the past three years (e.g. dodging the GFC bullet that the Coalition wanted to take between the eyes like a good grunt) looked to be going down the toilet, but Abbot snatched defeat from the jaws of victory and they got another lifeline.

Did they learn from their mistakes - did they bollocks!

The past couple of years guiding significant legislation through an absolute political minefield should be a feat to be proud of, but continuing leadership squabbles and various other PR disasters have led a slide in the polls. Considering the calibre of the opposition (which is simply appalling) this is particularly ignoble.

So for once I find myself agreeing with the baying shock-jocks and their self-interested sycophants. Let's have a coup now and toss Gillard and her rabble out.

... as long as we can do the same to the new fools once their popularity drops below 50%. I give them 6 weeks.

I don't agree that Abbot lost. He ( the libs won more votes etc) the problem arose from too many " independents" with personal agenda. The fact is labour was installed on false promises. ( wilkie a case in point) Abbot didn't play that way and he will have moral high ground in the long term by not doing so, one cold argue he should have played the game and taken the parliament. But he was always going to have a hostile senate.
Hits government was seen early for what it was. Inept, and deceitful. The long game here is labour will be out of government again for at least 2 and probably 3 terms. Katter saw it all and has kept his powder dry, and if the lobs are too far to the right, Katter is over the horizon in crazyville.
I really think Abbot is 10 times smarter than everyone thinks. And that is what has and will undo the current government.
I agree that he doesn't look like a future PM , but he hasn't been tested yet. And there are other more palatable options, unlike labour. .......mind you I could be completely wrong !

 

[Deleted member]

I would agree with a lot of what you have said (although the GFC management IMHO was more to do with dumb luck and cash in the bank than good management). Although the swift cash guarantee was very necessary.

I do however disagree on the electoral importance of the National Apology and Kyoto. Those who truly cared about these issues (voters to whom it was a vote-changer) were/are already ALP voters. I don't believe that those issues change governments. (not between ALP and Coalition anyway... Perhaps between ALP and Greens. ) personally - I think the relevance to voters of these issues is over-stated.

To the average swinging voter - good stable times (such as those enjoyed in 2007), do allow the luxurious indulgence in such issues.

When times are tougher - mainstream voters do not rate issues such as apologies, Kyoto, gay marriage or similar as vote-changers. They care about whether they can pay the mortgage, have a job next week, support their kids etc etc. That's why election issues don't always follow opinion polls and focus groups on any particular issue.

The environment is a great example - apparently in 2007 everyone cared about reducing emissions - one of Kevin's platforms. In 2012 - it seems the vast majority don't care so much about it when they actually see the supposed solution.

Mainstream voters don't indulge in peripheral issues when things aren't going well.

Whether Rudd was a phoney or not (my own views aside), at least at the time people believed that he would manage the important issues.

The fact that the Coalition is not on their best game but yet continue to trump the Government, speaks volumes for how much the current mob are out-of-touch with the majority (regardless of our tribal leanings).

I actually hope the ALP gets their act together - as much as I want to see them out of office... It's no good for the country if they are decimated.

That's a pretty summation , I agree with the sentiment about voter concerns, labour didn't ( and still don't) listen.

 

[drron]

That's not what the Coalition said they would have done, but no doubt they were lying, eh? Hypothetically if they had been in charge and had rolled out a much smaller stimulus package as planned, then Australia would have slipped into recession. This is not idle conjecture - it is as close to certainty as you can get. In fact a few economists claim that while we did not officially cross the line into recession - it was about as fuzzy as the current "surplus".


But imagine what being told we were in recession would have done to public and business confidence. Once that genie was out of the bottle it is very hard to get your mojo back (just look at the rest of the developed world), and we would likely have a one-speed economy at the moment. [Everything not resource-based being dead in the water].


Anyway - I just pray that the coalition are lying, because if they follow through on all the current "promises" we will be looking back at this time a little more fondly than we would imagine.

Of course the economists who said we did the right thing with the stimulus package were the same economists that didn't see the GFC coming.
Japan had its GFC in 1991.They have had numerous stimulus packages since but their share market and property prices still are well below the levels then.Their gross debt is the largest in the world as a percentage of GDP.Now with the aged population numbers increasing whilst the working population decreases they are facing huge problems.
All the stimulus packages do is kick the can further down the road.For example Hardly Normal had a big spike in sales and profitability with the original cash splash then.But as was predicted by some economists that just brought forward spending so the demand drops later-as it has done with Hardly Normal.
This week on ABC National the owner of a sex aid shop in outer Melbourne was interviewed.She was looking forward to next months cash splash because last time her turnover increased 20%.She thinks it might increase by 30-40% this time.What this demonstrates is the economy was stimulated but not economic growth.Very little was produced of benefit for the future.Compare that with the US stimulus in the 30s-Hoover Dam,Rockefeller centre etc.
And finally the examples of stimulus in the USA,UK and the EU are hardly great adverts for stimulus packages.In fact one of the countries that is doing best since the GFC is Iceland-no stimulus,allowed banks to go bankrupt,devalued their currency=debt wiped out and now bouncing back strongly.
The real reason for our doing so well is not the stimulus package but the fact China has saved our bacon.The last 4 years have seen Australia's terms of trade at record levels.
Wayne Swan should really be known as the World's luckiest Treasurer.

 

[rechoboam]

The idea that a government can fix or avert a recession by giving out money seems fundamentally absurd to me. If that were the case what would prevent the govt from making everything perfect all the time? The bank guarantee was important. I think everything else could have been skipped.

Previously I thought things like the 50% depreciation bonus were useful. However having been in a car showroom at the time and having been in the same one recently I think it just deferred problems.

 

[serfty]

...

Very few polls one sees in the media (for example) have anywhere near enough data points to be statistically relevant or to make wide sweeping claims about what the population as a whole actually wants.

They actually to tend to provide a reasonable guide.

The major polls are released with a published statistical error margin.

e.g. Galaxy poll's trumpet an average difference of 1.4% in relation to actual election results. Galaxy Research - political polling

 

[dfcatch]

The idea that a government can fix or avert a recession by giving out money seems fundamentally absurd to me. If that were the case what would prevent the govt from making everything perfect all the time? The bank guarantee was important. I think everything else could have been skipped.

Previously I thought things like the 50% depreciation bonus were useful. However having been in a car showroom at the time and having been in the same one recently I think it just deferred problems.

The concept of pump priming is sound, the effectiveness is arguable.

Most economists agree the first stimulus helped, but that the second larger one was over the top and too late.

The bigger issue was that Labor had no idea what they were doing. Right as the subprime crisis was looking to morph into the GFC and everyone was urging spending / potential stimulus, Rudd/Swan were declaring war on inflation when blind Freddy could see that it was completely the wrong direction.

That's why the stimulus (2nd tranche) is criticized for being too much too late.

The second reasoning behind tax and spend to stimulate the economy (not so much "pump priming") is the Marginal Propensity to Consume. In short - every dollar that is spent by government goes into the economy, whereas a dollar of tax saving is partially consumed by savings, and only a percentage goes directly into spending.

Of course this ignores the benefits of saving, availability of capital, incentives to earn etc etc.

It also ignores the issue of debt-funding stimulus (as opposed to true tax-and-spend).

None of it is simple, and none of it is universally agreed upon. But there are the two primary theories as to "why" the government would take that action.