If you’re looking to make an informed vote based on economic strength this Saturday, here are some numbers worth looking at. The Australia Institute has released a paper analysing the economic performance of Australian governments from Menzies onward.
Here are some highlights of the report.
* Note that while the Howard government passed a surplus to Rudd (that he famously destroyed and put the government into debt), the debt was accumulated in the roll out of Rudd’s stimulus packages during the global financial crisis. And what is a budget surplus if not unallocated funds to cushion a country in unexpected economic crisis? That is precisely what Rudd did, and may have been the best economic management the country has seen—ever.
On GDP per capita growth:
Only the Rudd government performed worse than the Abbott/Turnbull duo in this category. Remembering that both governments have been victims of difficult economic times, you might be ready to shrug it off. The Gillard government’s result matches Abbott/Turnbull at 1.1% a year each—so where exactly does this idea that the ALP under Gillard was worse at economic management come from?
On jobs and wages growth:
Of particular interest to those of you who like to eat, and who need the money to invest in food to indulge in the luxury of eating: wages growth has suffered under the Abbott/Turnbull government.
Remember that in this time, while wages are falling, living expenses are still inflating. The average postage stamp costs $1 and public transport fares increase every January 1st. Wages should be growing to support those costs, not shrinking.
On household debt growth:
This is where it gets scary. This is where we see the sort of ‘growth’ Abbott/Turnbull have really shared with the Australian public.
Record low wages and income growth coupled with record increase in household debt. Not really something you’d want to boast about.
On allegedly reducing government debt:
So there’s some numerical support here. Some. Under Rudd, government debt growth hit a record 3.3% pts per year. As noted at the top of the article, a large chunk of that growth was in response to the global financial crisis, and a government that was determined to out-spend economic disaster.
On the GDP and economic growth:
If you look at the numbers as they’re typically presented (by average GDP growth per year), you’d be fooled into thinking that Rudd was a terrible economic manager. Abbott/Turnbull are too willing to boast their 2.60% growth against Rudd’s 2.17%, though they notably forget that Gillard tops the three recent governments with a growth of 2.75%. Essentially, GDP growth has stalled since the Coalition came into power, and that is not what they would have us believe.
To look at the numbers a different way, and the way they perhaps should be measured, is to compare those growth rates against the rest of the world–against the Organisation for Economic Co-operation and Development or OECD. This gives a picture of how each government performed against other countries during the same economic period.
That is, Rudd’s performance against other governments faced with the GFC, Howard’s performance in relatively stable times, etc. To compare governments directly with each other is somewhat unfair, as they each faced different situations in global economics.
This data, displayed by the percentage above the average GDP percentage growth across the OECD tells a vastly different story than a comparison of Australian governments to each other ever will.
Abbott/Turnbull sits just 0.62% above the average OECD GDP, behind Howard (honoured alleged economic mastermind) and his 0.85% above. Gillard shows in at 1.04% above (yes, performing better globally in her time in office than Abbott/Turnbull has in theirs), but is eclipsed by Rudd who saw 2.89% above the falling OECD GDP. Australia grew stronger economically while the world struggled not to grind to a halt.
Part of that? The Labor government under Rudd utilising the budget surplus (and then some) to keep the economy moving. The big ‘economic mis-management’ that Abbott/Turnbull love to trot out under the terms ‘government over-spending’ and ‘increased debt’. Did Rudd spend too much? Possibly. We will never really know what the minimum spend would have been to keep Australia rolling during the crisis.
What we do know, is that we saw growth in that period. The measures saw results.