Friday, 11 May 2012

Knee-jerk politics and unusual policies

We have just been handed a budget by our great and glorious leaders, and quite honestly, it is pretty damn boring. I just don't care enough about it to have looked at it in great detail, and anyway, the media will hype anything of interest up anyway! Right?

Have a look at this comment about the front cover of 9 May's Australian. Really gives you some confidence in the impartiality of our journalists, right?

There seems to be a trend towards hyping up anything that will discredit or inconvenience the party in power. Since Labor have been in power, most of the news about them has been negative (ignoring the contents) or at least negative in spin.

Anyway, to this budget. The one thing that really got my attention was Suzie Keen's opinion piece in "In Daily" on 10 May 2012. In Daily is a free periodical that can be accessed at www.indaily.com.au, and is always worth a read.

Suzie noted that according to one budget calculator, she stood to gain $0.06 per week, or about $3.00 per year. That was because this budget, for all of its "Family Spending," (see "Business pain, families gain" type headings), did not have much for people who don't have kids in school.

The underlying policy to this seems clear. As always, our great and glorious are advocating an expanding population. Like Howard's "Baby Bonus", there is a push to stimulate the economy by increasing the population.

I guess there is some justification for this. We will need more people in the work-force as the baby-boomers begin to retire, but I object strenuously to the theory that economic growth is always good. As the economy gets bigger, the rich get richer, and that is good, but it always seems to be accompanied by a growth in the lower class. (Note that this is a blog, therefore an opinion piece, and no, I don't have anything to back that up with.)

Ok, so that is my first dig today, at the policy that growth is a must. That sorta (not really) leads me on to my second dig of the day, which is the Euro-zone crisis. Specifically, the response of the rest of the Eurozone that is NOT in crisis.

Take as the premise that Greece is in a terrible financial position and looks like defaulting on its debts. The terms of any bailout include harsh austerity measures. Increase the pension age, lower the pension. Reduce government spending, cut back on public sector wages.

The whole point of this bailout should be to stimulate the economy and promote good policy and management. The thrust of the current bailout seems to be to grind Greece's economy into the mud! Surely a better way to get government debt under control would be to try to increase employment, spending, and therefore taxation?

There are some policies that are necessary, such as increasing the retirement age. But firing all your public sector workers is just going to put them onto welfare themselves. Why not focus on reducing corruption, and developing the aspects of Greek economy that are producing a return?

Also, riots and protests don't make anyone any money. Except placard-makers.

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