Talk It Out

Crystal balls and election year politics

A yet another embarrassing leak about big business plans to advertise in support of Howard's WorkChoices revealed that the business groups commissioned economic models to speculate on what economic benefits WorkChoices brings to Australia. The models are likely to be used as basis for advertisements to tell the voters about the inflation, unemployment levels and economic growth "penalty" that would result from employees having any rights in the workplace.

Of course you can get an economic model to give you any answer you want, depending on the assumptions and methodology you chose to adopt. Pick the outcome and there will be an economic model out there to justify it. Pick an opposite outcome and there will still be an economic model that will give you that outcome. Both of those models can sound feasible and yet be complete nonsense.

Interestingly, this economic modeling by the business groups seems to be inspired by government commissioned models, which ensured favourable results by assuming the outcomes that they desired to achieve. The business groups model was constructed according to (undisclosed) "terms of reference" (ie assumptions) given to the forecasters by ACCI. Apparently there were three scenarios to examine: "no change to Work Choices, an abolition of the industrial relations laws, and a return to the pre-1993 era before the Keating government made enterprise bargaining the main mechanism for wage negotiations." Needless to say that "a return to the pre-1993 era" is not on the agenda of either party. The only possible rationale for examining this scenario is to push the "Labor will ruin the economy and cause Australia to collapse into the Pacific ocean" type of scare campaign. Very much like the sort of campaign that the Howard government likes…

And coincidently, the firm retained by the ACCI - Econtech - has done quite a bit of work for the Howard government, on issues from effect of tax reform on boarding houses, sale of Telstra (where their analysis was used by the government to attack Labor), the tax system (note that the Econtech report was criticised by a Senate committee for very selective use of assumptions) and other work (just google the name). See any similarities with the big business advertising consultants' connections to the Liberal party?

But even without the lack of transparency in assumptions and the flawed scenarios, economic forecasting is a bit like weather forecasting - it is occasionally right, but only by accident. As Laurence J. Peter so wonderfully put it - "an economist is an expert who will know tomorrow why the things he predicted yesterday didn't happen today." Economic models are not crystal balls that show the future, they are just guesses, based on a whole lot of (politicised) assumptions. And they make an excellent basis for misleading advertising.

June 23rd, 2007 Posted by Unsilenced | Australian politics, Howard government, Industrial relations, Australian election, Business groups, Economics | no comments

Encouraging people to become citizens is a dirty trick - just ask Hockey!

Every time I think that the Howard government has reached the pinnacle of hypocrisy and dirty politics, I'm in for a surprise. Today is no exception.

Joe Hockey accused the unions of using dirty "tricks to get workers to vote against the Howard government at the next election". Now that of itself is nothing new, the Howard government can't go a day without accusing the unions of something. But what have the unions done this time to upset Joe?

Well, they are engaging in the heinous act of "trying to persuade migrant workers to become citizens so that they can vote."

How absolutely dreadful! Encouraging people who are entitled to become Australian citizens to actually take up citizenship - a "dirty trick" indeed! While Joe was huffing and puffing about unions, he obviously forgot about the ads that the government has been running, encouraging people to do exactly the same thing.

Remember those advertisements that "there has never been a better time to become an Australian citizen"? The ones sponsored by the federal government and paid for by the Australian taxpayers? How about the Australian Government Citizenship Initiative website - http://www.citizenship.gov.au/, which reminds us that the Australian citizenship is "much more than a ceremony" and tells us that:

"Australian citizenship symbolises our unity as a nation. It represents commitment to Australia and its people, the values we share and our common future. It also symbolises the sense of belonging to the country where we have been born or where we have decided to make our home."

How very inspirational. Also inspirational are the Department of Immigration media releases following citizenship ceremonies which state that "taking up the privilege of citizenship was a great expression of loyalty and commitment to the Australian way of life".

But when it is a union encouraging migrants to show their "commitment to Australia and its people", "the values we share" and "to the Australian way of life" - it's a dirty trick, according to Hockey, an unworthy attempt to throw out the Howard government. Citizens can vote, you see. And if they can vote, they might vote against the Howard government. And that's just not on!

Thanks for reading 

June 23rd, 2007 Posted by Unsilenced | Howard government, Industrial relations, Unions, Australian election | no comments