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"...public opinion deserves to be respected as well as despised" G.W.F. Hegel, 'Philosophy of Right'

the light at the end of the tunnel « Previous | |Next »
January 30, 2013

In his Upside to economy's downside column in the Sydney Morning Herald Ross Gitten asks: why has the gloom of so many business people and consumers greatly exceeded the reality? Why have people's perceptions of the state of the economy been so much worse than what the hard facts tell us.?


Gittens reckons that a big part of the explanation is political. By this he means that:

Many business people seem to be sitting on their hands until the political atmospherics improve. They say the period of minority government has damaged confidence, but this is code for their impatience to see the back of Julia Gillard.....If you delve into [the Westpac and the Melbourne Institute] index you discover that people intending to vote Liberal are far more pessimistic about the economy than those intending to vote Labor. I suspect it will prove a better indicator of who'll win this year's election than of the prospects for consumer spending.

The end of the gloom for the corporate elite is a Liberal government. With the proper order restored all will be well in heaven and earth and we can all relax and be comfortable. The corporate elite don't seem to appreciate that a Coalition government would be one blundering through history; or that it would be led astray by its ideological opposition to an educated polity and a strong research establishment that threatens the corporate elite's vested interests.

Gittens adds that another explanation for the discrepancy between perception and reality is surely that the difficulties currently faced by the manufacturing and retail industries from structural change caused by the high dollar and digital technology have mistakenly been taken as symptomatic of the whole economy.

The policy option here is is to allow the supply side to adjust to the different structure of demand more normal and sustainable sources of demand – to ease the way for retail workers and autoworkers to retrain for faster-growing industries. The worst thing that governments can do is to stand in the way by propping up unviable firms or by sustaining demand in unviable industries through easy credit. These kind of supply-side adjustments take time.

| Posted by Gary Sauer-Thompson at 6:17 AM | | Comments (7)


There are so many sectarians, obscurantists and anti-science ideologues in the Coalition.

The Australian’s David Uren says that economic policy focus should be on food and minerals to drive prosperity and wealth.

The heart of the Australian economy, as far as Asia is concerned, remains our supply of minerals and food. We do other things well, including education and tourism. Financial services holds promise. But Australia has global leadership in natural resources and agriculture, and that should be the base for our long-term thinking about Australia's place in the region.

Australia should specialise in industries that use a lot of natural resources.

Why not compete on the basis of our use of human capital rather than natural advantage?

"Why not compete on the basis of our use of human capital rather than natural advantage?"

that means reversing a decline in education standards in Australia relative to the rest of the world

"led astray by its ideological opposition to an educated polity and a strong research establishment that threatens the corporate elite's vested interests."

e.g.. the sceptical views on climate change. solar and wind energy amongst the highly influential Australian businessmen, politicians and media personalities.

They reckon that a group of elites within the scientific establishment, media and government are all collaborating to obscure the truth and silence dissent.

Thus we have the aggressive campaign to try to stop adoption of wind power initiatives by the Australian.

How can so many in business be both good at the minutiae of their livelihoods and so myopic and unreflexive, so uncurious, as to who and what they and the world around them are?
To kill off education and civil society kills an incubator for civilisation- these people seem like the ignorant peasants who chopped the goose's head off and tore open its innards in pursuit of another illusory nugget that would have came anyway with an iota of patience.
We have the US disease. Watching a business spokesman for the business lobby tonight, I thought of the citing of the Gittens comment, "...waiting to see the back of...Gillard", in his babble about "damaged confidence".
The crocodile tears don't obscure a ubiquitous dog in the manger attitude when Labor is in government that seems Hesiodic in character and apparently immutable.

Business has always been that way with Labor. The lets get them outa the way and times will be good attitude. Perhaps not so much now that Labor less represents as the workers party.
Dont think there is much sitting on hands waiting going on in small business at the moment. Politics isnt a factor. Its tough and most would shut the doors tomorrow if they could get out square and get a job.