There’s surprisingly good news on the employment front for January, with unemployment only increasing by .3%, full time employment holding steady and female full time employment rising substantially:
ANZ economist Katie Dean said the stimulus package had worked to retain jobs in January in tandem with aggressive interest rate cuts. “The stimulus measures are having an impact,” she said.
Interesting news for the Liberals, you’d think. The Shadow Treasurer’s reaction?
The Coalition’s Julie Bishop said it showed the jobs market was strong enough not to need the “$42 billion spending spree” rejected by the Senate.
Right then.
The Government has struck a deal with Xenophon. He’ll be in the Senate chamber shortly. You heard it here first.
More likely, the areas of the economy that are tanking are in the highly capitalised mining sector. This sector employs relatively few workers directly but the multiplier effect of those businesses is huge. It’s only a matter of time before the consequences ripple through the rest of the Australian economy.
Swan has already made dire warnings about the effect of this collapse in Australia’s main export sector on government tax revenues. From memory he quoted a figure north of $150bn.
Bishop’s specious logic is breathtakingly self-serving.
Well, as Headmistress Bishop has pronounced everything is fine, the Emergency Assembly is now completed. Girls, please return to your Domestic Science and Secretarial classes in an orderly fashion.
There is no need to visit the Tuck shop at lunchtime. Also, the extra allowance for cotton, thimbles and knitting needles has been withdrawn.
The House Croquet tournament will resume on Thursday afternoon, and auditions for both the Deportment and Embroidery Competitions will be held on Saturday morning.
The School Gardener (Mr Wilson) will no longer be with us. Ditto two of the Cooks. We must all scrimp and save when times are simply marvellous, girls!
I only caught the back end of the story on PM last night but questions have been asked about the accuracy of the statistics – large margin of error in the sample due to reduced sample size due to reduced budget (Swannie!). Could have been a drop in employment, too.
My current hobby:
Saying to my Liberal friends “Julie Bishop is certainly a far more effective and able deputy than Julia Gillard”
and then watching the expression on their faces.
Perhaps Jools should have a look at the Age analysis referred to by Peter Martin in this post Linked text
The employment figures were very dodgy before the government recently cut funding to make them completely useless.
Is she really that deluded?
Didn’t Bob and the Greens squeeze some more money out of the stimilus package for the ABS?
the corollary of Bishop’s statement is that there may be circumstances when the Rudd Package is the appropriate response.
Yet official Lib rhetoric has it that compelling our grandchildren to pay for our stimulus is always wrong.
Clearly Bishop hasn’t been following the bouncing ball during Liberal party community hymn singing.
For God’s sake, Julie, pay attention!
Razor @ 4 Heard the same story. Link if anyone is interested.
When was the last time we had a shadow treasurer that was spread so much mirth through the land? I hope they don’t dump her.
In October 2007, according to the ABS, employment increased by 12,900. This actually meant that with a 95% confidence level, the change in employment was between –34,100 and +59,900. I don’t recall anyone back then dismissing the 12,900 figure as meaningless. Anyone who understands statistical methodology knows not to place much weight on monthly variations but that doesn’t stop some in the media making breathless announcements implying fraud and deception when someone finally gets the concept of confidence levels through their thick smug heads.
Kim Says:
[CROW ALERT]*
Not surprising to me. Earlier this month predicted that AUS will weather the GFC better than comparable countries , with our unemployment to stay well below double figures and house price falls by less than 20% off their peak.
My reasoning is that our banking system is healthier than the RoW due to Howard-Costello’s magic bullet for financial solvency: more prudent load provision by lenders (due to stricter post-entrepreneural prudential regulation) and better loan service by borrowers (due to massive immigration driving up rents).
Rudd-Swan are certainly building on the good foundations laid by the RBA and Howard-Costello. The big interest rate cuts are doing their bit, possible because inflation is still within reasonable bounds. Also the Commonwealth’s sound financial position, inherited by Rudd, has left plenty of money in Treasury for the big stimulus:
I am also reasonably bullish about the medium to long-term prospects of AUS’s mineral trade with the PRC. The CCP’s standing committee on foreign investment was in town the other week, with a shopping list of properties and equities to prospect. They will be pulling out their chequebooks in a year or so;s time, when the market troughs.
Undoubtedly they see the need to shift investment out of the dodgy US and into more reliable investment destinations. Also they will continue to need more minerals to supply the re-development of the western hinterlands.
THis is necessary for economic reasons (switch from flagging external to lagging internal demand) and poltical reasons (to appease internal rural unrest). So ignore the bears on the PRC.
Its too early to claim victory for my theory yet. We still have a fair bit to go down. But we are not going to crash like the US and UK.
So I am going to rake in any brownie points I can for making correct predictions. BTW, Kim and Mark and Spiros (and Nabakov and Fyodor if your are onine), what are your emprically testable quantitative predictiosn?
Just askin’.
* [EATING CROW ALERT]
For most of the late noughties I expected and predicted (08/18/05 at 03:15 PM) that AUS would be more vulnerable to the inevitable GFC due to our higher reliance on (now costlier) outgoings to service capital inflows and (now cheaper) incomings from mineral exports would make us more. Hence my hysterical blogging about financial bubbles in equity and property markets. I was wrong about that. I over-estimated the severity for AUS (and under-estimated the severity for the RoW).
Getting a sense that the idea in camp liberal that the best economic managers are lawyers with good contact books and battering ram personalities might be hitting some obstacles in the real world.
You’re right, Armagny. Clearly the best economic managers are moralistic Mandarin speakers, second-rate academics and union lawyers.
- required – yes, but they have to be able to LISTEN and critically ASESS the advice their Treasury and RBA boffins present. Could that be the difference? Without such advisors, Viscount Turnbull and Headmistress Bishop are stumbling about in the dark…?
This nutcase has been saying all along that “union bosses” would wreck businesses and employment in this country. Honestly, she should get someone else to write her lines. Someone who understands consistency and continuity.
Either that, or she should copy someone else’s lines.
It’s not necessarily the worst problem for the Liberals that Julie Bishop doesn’t have a clue about her portfolio (though it doesn’t help!)… the bigger problem is that what she says is politically dumb and massively counter-productive. They really have to think about getting rid of her.
To be fair to Julie Bishop, she’s hardly ever on the telly or rafio. Viscount Turnbull hogs the limelight. He is whom (does that sound like Malcolm, “he is whom”…) most voters will blame, I think.
radio
‘rafio’ is a raffish Rasta-rap group with Sicilian undertones
Apart from not knowing anything about here portfolio, Bishop’s an example of how ridiculous the game of politics has become. Everything needs to be spun to party lines and it make everyone look foolish. Add to that Hockey’s childish antics in question time yesterday and Turnbull’s claim that Rudd’s economic plan had failed after the senate’s initial rejection.
Not that the Libs have a monopoly on such behaviour (NSW Labor are star performers in this regards) but is there a politician that has a modicum of self respect anymore?
Sorry for the meta commentary.
“Clearly the best economic managers are moralistic Mandarin speakers, second-rate academics and union lawyers.”
That’s agreed then.
90 000 jobs will be ‘supported’ at a cost of $700 000 per job.
Less than a decade ago, many people believed that the unemployment rate in Australia could not fall below 6% before inflation kicked it. It’s now 4.8%.
Is it worth spending $42 billion to keep the unemployment rate at record lows?
Jack M. Strocchi @ 13:
There’s a lot of premature self-congratulation going on in Australia at the moment. Lets see how Australia weathers the collapse in Asian trade before we get too cocky.
And to think Julie will be on Q&A next week. Now that’s something to look forward to.
Bobby(23):”90 000 jobs will be ’supported’ at a cost of $700 000 per job”.
In that case I’d like to exchange the actual job for the support.
Cash would be nice, who do I see about it?.
Liberal vultures are circling Julie Bishop
Liberal vultures are circling Julie Bishop
The Sydney Morning Herald is reporting on grumblings from within the Coalition on the performance of shadow Treasurer Julie Bishop. No kidding. She isn’t quite Sarah Palin, but she’s no intellectual giant either.
As an aficionado of the Laffer Curve school of economics, it’s worth considering how Ms Bishop approaches solving our great national problems. I would suggest she depends heavily on the same oracle as the Republican Party in the USA.
You too can now access the thoughts and penetrating insights of the oracle who is guiding GOP and Liberal Party policy prescriptions.
Wondering what Ms Bishop’s and the Liberal Party’s stance will be to tomorrow’s issues, today? Just follow the link to the
GOP,Brendan Nelson,Julie Bishop, Liberal Party Problem Solver for a sneak preview. (h/t to Brad Delong)But what would be the estimated cost to the government if 90-100,000 extra jobs were lost, and it took an extra 2 or 3 years for the economy to recover? There’s pretty good historical evidence that downturns lasted much longer before countercyclical government fiscal and monetary policy became the norm. Also even if jobs estimate is based on the entire package, it’s closer to 450,000 per job over 3 years – still a lot, but the general consensus from economists seems to be that it’s about right.
“people like her, she’s good value” ???Um.. naa I wont go down there. Oops!
As I said Julie’s on Q&A next week. Someone coukd ask her why are your fellow Libs trying to dump you as acting Treasurer?
Turnbull puts the kiss of death on Bishop:
I love the way the phrase ‘total confidence’ reliably means anything but.
Bop,
It would be about as reliable as a statement by JWH that he would retire and hand over to Cossi, was.
Somebody should send Bishop a bucket of water and ask to put her hand in the bucket then take her hand out. And think what that means.
If you were depending on the local steelworks for employment, you’d be shitting yourself about now. Seriously.
Rudd’s stimulus won’t help. It’s looking grim. A slab of steel isn’t exactly an impulse buy for most tax-payers.
Mars that would depend on how much the local steelworks depends on exports, and how much of the handouts are spent by consumers on products whose supply chain involves steel from said steelworks (e.g. the products themselves might be made from Chinese plastic, but still need local steel for shipping etc.). But in general anyone heavily dependent on a single source of employment is at high risk in current economic conditions. OTOH, it’s a good time for skill diversification, even if it means having to sell your house and rent cheaply for a while (not much fun if you have a family to support, of course).
What do you get when you give a “Laffer curve” to a cross Shadow? A Laffer-minute!
Look, no one finds Bishop’s travails more amusing than me – but as a general comment, and scuse my French: but why exactly are we trying to “stimulate” the dead corpse of ‘consuming on credit = teh economy’? Wasnt that the problem in the first place? Isnt this how we got into this mess?
I must have missed something.
Lefty, unfortunately the problem has swung to the other extreme now – everybody is suddenly trying to live well within their means and saving/paying off debt “excessively” – I agree that there’s room for measures to discourage making excessive use of credit for consumption once the economy is back on track, but now isn’t the time for it.
Well she’s gone now …. satisfied? You think it’s gonna be a quarter as much fun with Robb?
She’s “very excited about foreign affairs. It is an important role” She stays on as deputy leader.
Sure Wiz – on balance I support it, especially its broad redistributive aspect (more for lower and middle, less for higher income) but stepping back from the hooplah a bit, you’d have to wonder why we’d want to get a credit-driven bubble economy “back on track”.
Oh dear. What a goon. Can’t wait for her first policy announcement.
But if Bishop is the best person for the job, doesn’t it stand to reason that her less competent successor will excite even more unfavourable commentary?
So why cut and run? Bishop’s explanation makes no sense at all.
Katz – she didn’t claim to be the best. She claimed she had been diligent and competent. She claimed no monopoly on competence. At least she didn’t say she “wanted to spend more quality time with my family”.
Is it Robb? Well actually that will be fun. He’s one of the best people in the lower house, Abbot aside, to make the electorate aware of the putrid nastiness that underlies the Liberal Party. An excellent vote-loser. (Hope I’m right.)