Many of Government's problems are largely Swan's

Comments on Paul Kelly “Labor turns the boom into a crisis”, 24/08/2011, http://www.theaustralian.com.au/news/opinion/labor-turns-the-boom-into-a-crisis/story-e6frg6zo-1226120742007

Yes, it is the government's misjudgement and mismanagement that exacerbate the current manufacturing problems. However, I would attribute the bulk of the government's problems to the Treasurer Mr Swan.

Many of the government's problems are economic problems that are inherently Treasurer's main responsibility.
Rudd's mining tax problem, and the corporate tax relief problem and Gillard's carbon tax problem, they can all be related to Swan's poor judgements and poor management of economic policies.

Needless to say, Swan played a very poor role in Rudd's disposal.

The carbon tax and governance

Comments on Dennis Shanahan “Credibility joins carbon crusade”, 17/08/2011, http://www.theaustralian.com.au/national-affairs/commentary/credibility-joins-carbon-crusade/story-e6frgd0x-1226116270286

The government would sound more credible if it hasn't used the carbon tax as a way for wealth/income redistribution as it has proposed in its carbon tax package, and it got a border carbon adjustment to not distort and reduce Australians' comparative advantage in trade of goods and services with other nations.

These fatal shortcomings of the government's carbon tax bill are related to ALP Robin Hood ideology and its cowardice to confront other powerful nations in terms of equal treatment.

Of course, the compensations for businesses should not be as generous to recognise that businesses can pass the higher costs due to carbon tax either fully or at least partially as they are proposed in the bill, and more compensations should be for households on an equal per capita basis to remove the income distribution effects.

Further, it is hard to understand why it will be necessary to move from a carbon tax system to an ETS, given that the former is more efficient and involves fewer transaction costs. Of course, some financial market participants would like to have an ETS for the addition financial opportunities created by that to benefit from it. Further, bureaucrats would like it to create more government jobs and powers for them.

Taken together, it shows the government is incompetent, out of date and out of touch. This is another reason that it would be better for the government to seek a mandate for its carbon tax and ETS at an election. I should say I am not politically biased and is not pro or against any of the major political parties and I just would like to see fairness in politics and in governance.

Scared they've been on the run

Comments on Dennis Shanahan "erils for PM in hanging on to surplus", 12/08/2011, http://www.theaustralian.com.au/national-affairs/commentary/perils-for-pm-in-hanging-on-to-surplus/story-e6frgd0x-1226113362948
Gillard and Swan and their government has been particularly stubbon in promoting the budget surplus line of argument, so much so that they have greatly damaged their images and lost touch with the public. the flood levy, for example, was completely unnecessary, especially in the context that they had also pledged a carbon tax to come and the public were uncertain and concerned about the impact of the carbon tax in the coming years. Consumer confidence as well as business confidence have further eroded by the persistence of the surplus pledge at the expense of prudent economic and budget management.
Of course, Gillard and her coleagues have been aware of their broken promises, particularly the one on carbon tax, and the potential damage of further broken promises. But one has to weigh the benefits and costs of each policy and the totality of all policies and make the best choices and choose the lesser evils.
Unfortunately, Gillard and her colleagues have been scared and have not been able to show they are able to do the best and right things. they have tended to make policy on the run and rush to announcements without fully consider ttheir effects, for the nation and for themselves.

What all these show that Gillard and her colleagues in government have been unable to show true leadership. And that is not good particuarly for Gillard.

PS: see also: Alan Kohler "A surplus of political stupidity", 12/08/2011, http://www.businessspectator.com.au/bs.nsf/Article/Wayne-Swan-budget-Julia-Gillard-economic-crisis-ma-pd20110812-KMSTR?OpenDocument&src=rot.

Australia is undoubtedly a lucky country

Comments on Mumble blog “Australia’s miracle economy: fact or fiction?”, 16/05/2011, http://blogs.theaustralian.news.com.au/mumble/index.php/theaustralian/comments/australias_miracle_economy_fact_or_fiction/

While the points could be regarded as well made, it would be more helpful to or clearer to readers if a table showing period averages for the three countries were presented.

Secondly, while worldwide forces affect many countries, the charts, particularly the budget balance one, do show that Australia has been lucky due to the mining boom, so has been Canada. Improved and higher terms of trade helped to achieve better budget outcomes in both countries.

Thirdly, the chart with employment shows Australia benefited more than Canada, due to labour shortage as a result of the mining boom.

In contrast, Britain has not got this luck. And it is still struggling in the wake of the GFC, while we Australians are riding on another mining boom as commodity prices rise through the roof again and even higher!

Government tactics - clever, coward or irresponsible?

Comments on Julie Novak “What happened to the meat axe?” 12/05/2011, http://www.theaustralian.com.au/national-affairs/budgets/what-happened-to-the-meat-axe/story-fn8gf1nz-1226054249543

While all the arguments may be true, the government is skilful in trimming the APS by increasing the efficiency dividend.

So I would add some cautions to the post, even though I agree that the government created a false impression in the first place.

What the government is doing is to force or let the agency heads to do the nasty part of reducing employment in their own individual agencies without the government saying it is reducing APS jobs. It is clever politics, although it will damage and hurt some agencies more than other due to different conditions they have and whether they really have fats left or they are already being left with bones. So some may say it is lack of courage to do the right thing in the right way by a government.

The numbers of likely changes in some areas cannot show the dark side of some agencies that will have to reduce its staff numbers due to much slower than inflation increase in funding as a result of the increased efficiency dividend requirement.

Further, arguably, the increase in the pay in the APS over the last few years may not have match the increases in the private sector, even though there have been skill shortages from time to time across Australia.

Gillard better than Swan on some details

Comments on Joe Kelly and James Massola “Wayne Swan can't say which year Labor achieved its last surplus”, 12/05/2011, http://www.theaustralian.com.au/national-affairs/budgets/julia-gillard-defends-war-on-middle-class-welfare-in-budget/story-fn8gf1nz-1226054476115

Prime Minister Gillard has done some home work and was prepared for the issue of when ALP government last had a budget surplus, obviously much better than her Treasurer had been.

The PM should be commended for that and by implication Swan needs to improve a lot in this area, not the least to avoid breaking a glass with water spilling over a table of paper.

Having said that, I'd like to raise two points.

Firstly, while it is politicians' tradition to portray their political opponents as no policy detail and no substance in arguments, it should be noted that it is the government not the opposition that is responsible for government budget, with the supports of the full machinery of the APS. So demanding for the opposition leader to come up with details of an alternative budget should they question the government's budget is not the correct approach by a prime minister.

Secondly, the superficial figures of tax revenue as a percentage of GDP are only part of the story of whether a government is high or low tax one. There are other relevant issues, like how the tax revenue is spent, transferred or saved, and etc.

For example, a government may actually be a low taxing government even the proportion is X percentage points higher for a government in a year if it returns an amount of revenue more than X percentage points of GDP to the taxpayer, than an alternative scenario, and vice versa. The same thing can be said if government saves part of the revenue in a fund or pays off debts.

Further, arguably, a particular year’s government revenue can be affected by many factors, such as a sudden economic boom or improvement in compliance and enforcement, and etc.

In another word, it is government spending that is a better indicator of a government size.

On that account, ALP government generally perform poorly, especially if its larger spending was also related wastage.

Irresponsibility and incompetence of a government

Comments on “The budget that got away”, see Mumble Blog, 10/05/2011 on the day of federal budget, http://blogs.theaustralian.news.com.au/mumble/index.php/theaustralian/comments/tough_budget/

It is hard to understand why we have to had such levels of deficits, to the tune of $51 billion this financial year and $20 billion next financial year, given that, first we didn't experience a recession, second we have very good terms of trade and external demand for our commodities is extremely high, third, we have unemployment rates at or below 5%.

Yes, Rudd/Gillard/Swan didn't have the guts to reduce government expenditure in their first budget and used the GFC as an excuse to ramp up their own spending and wastage.

More ironically and or hypocritically, they didn't dare to stop the tax cuts that Howard/Costello introduced and continued to the Rudd years. Although that may not necessarily have been a bad thing compared to their wastage, they nevertheless blame Howard/Costello for causing the so called structural budget deficits.

The fact is that Howard/Costello had budget surplus, repaid government debts and created future fund, as well as cut taxes.

What Rudd/Gillard/Swan has done? Deficits and large deficits, debts and increased debts. Wait, there are more, new taxes and more new and big taxes.

For them to blame their predecessors is a bit too rich in politics and political incompetence and spin at the extreme!

It is a shame of them. But they don’t have a sense of shame and they don’t and can’t feel it.

That is a government out of touch, and senseless!

Question of least consequence?

Comments on Rob Burgess “The real reason to bash Swan”, 9/05/2011, http://www.businessspectator.com.au/bs.nsf/Article/Wayne-Swan-Federal-Budget-2011-Treasurer-deficit-s-pd20110509-GNSW3?OpenDocument&src=sph

Question of least consequence, are you kidding?

Rob Burgess argues that questions about “how big is the deficit, could it have been smaller, and how long will it take to erase”, are the most likely source of the bashing for Swan’s fourth budget at the budget night, but they are also the question of least consequence.

I would question why?

One should ask a serious question of why those are the only main reasons for increasing budget deficits for 2010-11:

“From the MYEFO figure of $41 billion, the budget deficit is now expected to come in at $51 billion. Roughly a third of the blowout is from funding natural disaster relief in Queensland, Victoria and WA. The remainder is largely split between a drop in capital gains tax (housing falling, shares drifting) and weaker corporate tax receipts as the China-led terms-of-trade boom continues to punish non-resources-related businesses.”

Why shouldn’t one ask about the quality of budget in the first place? That is, why didn’t the government expect some possible impact on its revenue sources when it made that budget? Or was the government too optimistic than warranted at that time?

Besides, has there any positive side story of revenue impact that that should be included, or there has been none during 2010-11?

If one looks from this aspect, then those are not least consequence questions any more.

Swan's strict fiscal rule

Comments on Wayne Swan “Fiscal policy is setting us apart”, 14/04/2011, http://www.theaustralian.com.au/national-affairs/commentary/fiscal-policy-is-setting-us-apart/story-e6frgd0x-1226038712169

A comment first: yes Mr Swan, your fiscal rule is strict: if there are additional expenditures, you bring in a new tax to meet them.

That is as strict as it can get.

But whether that is responsible or not, or a good fiscal policy approach or not, is another matter altogether, isn't it, Mr Swan?

It is not too difficult for people to see it at least is a very lazy approach, no matter how you dress it up and spin around.

PS: maybe Mr Swan meant another strict fiscal rule: to only allow school to use the BER funding for building school halls and or libraries, irrespective what they need most and how effectively those school halls and or libraries contribute to those schools education needs.

Of course, it was wastage, as most people have realised.

Further, the pink batts scandals are worse than whether the insulations are effective or efficient or not, it still costs taxpayers money now to just fix up the messes left by those programs.

Swan can't avoid Keynes's curse

Comments on Jessica Irvine “Swan proved Keynes works but can he avoid Keynes's curse?”, 13/04/2011, http://www.smh.com.au/opinion/politics/swan-proved-keynes-works-but-can-he-avoid-keyness-curse-20110412-1dcis.html

While there may indeed be Keynes's curse in a logic sense, but it is the real political economy of most government budgets that cause more grieves and cynics.

It is not the inevitable wastage of most government fiscal stimulus measures, but the stupid, sometimes deliberate and politically driven wastages that are the problem for the public.

For example, there have been so many examples of wastes shown in the BER programs. Further, the restrictions for the BER projects for each and every school to be either school hall or library were so problematic, because that is another form of wastage (it is not the best outcomes or the most effective projects for many schools and they could have been better off if they had been allowed to build what they need most) that could and should have been avoided.

The home insulation programs are another example. Why didn’t the government anticipate the potential risks and problems in advance and take measures to minimise them is beyond anyone’s belief?

On that account, Swan will not be able to avoid the crudest Keynes's curse due to those silly designs of the government policy and poor implementations.

Most economist students will be shocked to realise that the real world fiscal policy design in terms of its content is nothing like what they were taught from the textbook – a government that always acts with a good intention to achieve good fiscal policy objectives.

Welcome to the real world, at last.

Swan and Gillard's low lines

Comments on Wayne Swan “Levy helps us to pay as we go”, 10/02/2011, http://www.theaustralian.com.au/news/opinion/levy-helps-us-to-pay-as-we-go/story-e6frg6zo-1226003217719

Swan is repeating the line that "Even someone on an annual income of $80,000 will pay only $2.88 a week - less than the price of a cup of coffee." But a one per cent increase in Medicare levy is more than 2 or 3 per cent increase in their tax bills.

He ignores the fact that the $1.8 billion is about 0.5% of federal revenue. And more importantly, it is less than the waste the federal government has done in its BER programs, along!

He and Gillard have been saying in terms of how many cups of coffee for those being hit, but they just hid the fact or the picture in percentage terms.

They conceal their poor management of taxpayers’ money.

How hypocritical is that!

It appears that Gillard and Swan have been trying to divide and conquer the public and taxpayers by this levy.

They divide states against states.

They divide taxpayers against taxpayers.

It is trickery in behaviour.

It is low politics.

It is demeaning.

PS: Swan says “Levy helps us to pay as we go”. It could also be said "Levy helps us (the government) to manage as they waste”.

Swan's levy of essentials

Comments on Siobhain Ryan “Flood levy in frame as Wayne Swan rules out cuts”, 26/01/2011, http://www.theaustralian.com.au/national-affairs/flood-levy-in-frame-as-wayne-swan-rules-out-cuts/story-fn59niix-1225994545370

Mr Swan opportunistically says "But I don't think the Australian people would want us to respond by hacking into essential expenditure in health or education, sacking teachers or nurses."

But he conveniently conceals the fact that few Australians want them to waste billions in the pink batts scheme and building the school halls programs. What happened?

If the government had not wasted in those schemes and programs, then we would have them available for rebuilding the floods affected areas.

When those wastes were happening, why didn't Swan or anyone from the government say anything those wastes could do to those essential services?

What a joke!

Swan, Gillard and the government always have a reason to do whatever they want to do, irrespective it is really reasonable or not. What is the point for Swan to say that?

But it serves the point that it is not too difficult for the public to see their hypocritical side.

Swan tends to be an embarrassment. What a awkward duck!

Why Swan needs to warn about price hike?

Comments on James Massola "Inflation figures are good news for rates, but Wayne Swan warns of looming food price spike", 25/01/2011, http://www.theaustralian.com.au/national-affairs/treasury/inflation-figures-are-good-news-for-rates-but-wayne-swan-warns-of-looming-food-price-spike/story-fn59nsif-1225994289457
Wayne Swan said the impact of the floods, in economic terms, was the worst the nation had seen.

That is unlikely to be true.

We have very large scale droughts running for years that affected agriculture in Australia and affected other industries as well, such as the gardening industry with water restrictions in many places. Some people even didn't have water to shower.

So what was Swan talking about!

Some politicians are used to scare people and conceal their own deficiencies.

This is a good example.

From his role in the RSPT fiasco, it is not too difficult to know how good his economic management skills are!

We shouldn't expect too much from him. Otherwise we would be bitterly disappointed.

AS the Treasurer, his warning of price spike next quarter is neither warranted, nor helpful to expectations, see the following from the report.

TREASURER Wayne Swan has warned of a looming spike in inflation as the impact of the floods is felt in food prices at the checkout.

He welcomed soft inflation figures released today, which make an interest rate rise less likely next week.

But the March quarter consumer price index won't hold such good news.
“Despite the fact that these figures are lower than anticipated, we do know the next quarter figure - the March quarter - will see a spike, particularly on vegetable and fruit prices and that will have an impact on the March quarter,” Mr Swan said in Canberra.

Wong follows Gillard and Swan

Comments on Ben Packham “Rebuilding Queensland after floods won't alter budget surplus timing: Penny Wong”, 19/01/2011, http://www.theaustralian.com.au/national-affairs/rebuilding-queensland-after-floods-wont-alter-budget-surplus-timing-penny-wong/story-fn59niix-1225990976483

It seems some of the federal Labor ministers are really fool headed with no strategic political sense.

Swan is one - the Treasurer who presided over all Rudd government's ill conceived and ill managed government spendings, such as the pink batts, the BER wastes etc, and the disastrous SRPT policy. He, however, got promoted to Deputy PM after Gillard deposed Rudd from the prime ministership. What did that say of the quality of federal Labor politicians?

Wong had a record of failed climate change policies in Australia - she was the climate change minister, failed in negotiation with the Greens to pass her climate change legislations in the parliament. What her accountability was? She got the key finance minister, albeit she left the difficult position of climate change minister where she was assisted by the current climate change minister Greg Combet.

The PM, Gillard, having deposed Rudd and being very skilful in negotiations with the independents (unfortunately at the expense of the nation I am afraid to say), was nevertheless the education minister who presided over the BER wastes. Now she is seen clueless to key policies.

Maybe that is the result of a minority government. But that is exactly the time real leadership can shine. But she hasn't, not since she became the PM.

Swan - what can we say about him?

Comments on Wayne Swan “Conservatives are the new nabobs of negativity”, 3/01/2011, http://www.theaustralian.com.au/news/opinion/conservatives-are-the-new-nabobs-of-negativity/story-e6frg6zo-1225980655211

Swan says: "Almost alone in the world, we now have the luxury of setting ourselves up for the big economic opportunities by investing in the things that will give us an edge: knowledge and skills, environmental sustainability, and the digital economy."

Let's look at the 3 areas he included here: education, environment and digital one by one. For education, Labor government undoubtedly had the BER. But unfortunately the BER has had so many wastes that greatly reduced its effectiveness.

For the environment, the Labor government has had the home insulation program that it had to stop it due to rots through abuse the program and the safety problems that program generated.

For the digital issue, the government has got the NBN going now. The difference between this and the other two is the very long time of the NBN project and the huge investment. Further there is no business case study and cost benefit analysis.

Swan in this post argues the negativity by others. Looking at what the Labor government has done the above so far, how can people not feel negative? How much more wastes will Swan oversee as the Treasurer?

Swan should look at himself to find where the problems lie.

PS: due to length limit, the original comments could not include more. But when I read more of that post, the more I felt Swan's hypocrisy. On resource taxation, they had to scrap their RSPT and replace it with their MRRT. They had done it not because of pressure from the opposition, but from the mining sector. Further they brought down their own first term prime minister, due to problems with their RSPT.

On the NBN, the government tried to prevent the release of relevant information to the parliament and delayed and delayed releasing the limited information they promised to do it.

So whose problems are they? Who are more negative?

He should be ashamed what he has done to the nation in terms of wastes, his role in them and his role in replacing Rudd and being promoted.

Federal Labor should be wise on MRRT with the states

Comments on Paul Kelly “Labor can't afford another humiliation”, 24/12/2010, http://www.theaustralian.com.au/news/opinion/labor-cant-afford-another-humiliation/story-e6frg6zo-1225975606789

Well, Paul, you have set a bar that is too high for Labor.

Another humiliation, unfortunately, is on the way and is inevitable, that is the fight with the states on state mining royalties.

Unless Gillard/Swan and the federal government retreat immediately from their current attempt to force the states to bend to its will on mining royalties, they may lose even more including their current MRRT to the states, should they mount a constitutional challenge on the constitutional validity of the federal government to impose that tax.

The fundamental fact is that the right to royalties or mineral rents as the MRRT says, belongs to the states, unless the land belongs to the Commonwealth.

Gillard and Swan need to be much wiser to launch a fight with the states to pick up royalty revenue from the States.

They have been silly on this for some time and now they need some sanity in their own minds.

What does the entire above mean? It means that another humiliation is already on them, sadly to them.

For your own sake, please give up Treasurer job, Swan

Comments on Peter van Onselen Swan's apprentice outshines the chef”, 17/12/2010, http://www.theaustralian.com.au/news/opinion/swans-apprentice-outshines-the-chef/story-e6frg6zo-1225972364861

It will be in the interests of Swan himself, Gillard, the government and Labor (and the nation dare I say) for Swan to swap to another portfolio that he is capable to handle while keeping the deputy PM role.

His role in many of the policy blunders such as the failed RSPT up to now and in disposing Rudd as PM shows he is not up to the job.

The nation hah not seen a so incompetent Treasurer for a long time until he came to the post.

If he continues the Treasurer job for long, it will be really unfortunate for many and many people including himself.

He should have the knowledge and wisdom of self aware and take the best step for himself.

What job best suits him? That is anyone’s guess.

Swan's 'reforming' the banking sector

Comments on Michael Stutchbury “Package gives policy a bad name”, 13/12/2010, http://www.theaustralian.com.au/business/opinion/package-gives-policy-a-bad-name/story-e6frg9p6-1225969800721
Is this another grocery watch idea, RSPT idea or pink batts idea?

It is likely to increase the costs to consumers and mortgage holders in the longer run, because of the propping up of smaller non-banking organisations using taxpayers' money.

With Mr Swan at the helm of the nation's economic policies and reforms, how much can you expect, if the RSPT dramas and fiascos were of any guide?

Among the most recent Commonwealth Treasurers, where would people rant him in terms of competency, style and achieving good outcomes for the nation?

But I am not sure how to comment on Swan's legacy. To fair to him, he has been on the position for just three years by now.

Beattie must be kidding

Comments on Peter Beattie “Swan succeeds where Obama fails”, 30/10/2010, http://www.theaustralian.com.au/national-affairs/swan-succeeds-where-obama-fails/story-fn59niix-1225945028550
I am sure the comparison of Obama with Swan is relevant.

The condition in the US has been so different from Australia.

If policies developed or proposed are a guide, the RSPT, even the health reforms, don't lend support to the argument that the Treasurer is strong or can be a useful assistant to the PM.

Just think about what happened to Rudd - Swan was the Treasurer when Rudd was PM and RSPT was his baby and was the straw that crushed Rudd's prime ministership; he was promoted when Rudd was dumped!

Swan's unique stuff of mathematics

Comments on Peter Hartcher “Role reversal from Swan and Hockey”, 10/08/2010, http://www.smh.com.au/opinion/politics/role-reversal-from-swan-and-hockey-20100809-11u1w.html?posted=sucessful
The argument of federal debt to peak at 6% GDP is equivalent to "which is like someone who earns $100,000 borrowing $6000", demonstrates another simple mathematics by the unfortunate Treasurer, because the federal government does not own 100% GDP: to be correct - what it can take is only the tax part.

How can the Treasurer make this sort of arithmetic? No wonder the federal government has been plagued with wastes in its programs with such a man as Treasurer.

He has been acting as if he owned every cent of the nation's GDP! Bet, bet and more and bet using others' money.

Whose money? Taxpayers, of course!

Is this another stuff learnt from primary or secondary school, in Australia?

Or is it because of logic and numbers as opposed to simple numbers?

It seems that is really some stuff hard to understand.

Laughable stuff? You bet!