One of Andrew Bolt’s columns in today’s Herald Sun is a critique of Kevin Rudd’s management of the economic crisis. While being careful to note that there is no proof that the Rudd Government’s attempts to stimulate the economy have failed, Bolt compiles a lengthy list of the ways that, according to him, Rudd has got it wrong.
But are some of these things really the sins of Rudd?
This December quarter slump almost certainly will be followed by worse figures for the March quarter, giving us a technical recession.
But only last November, Rudd said he agreed with predictions by deputy Reserve Bank governor Ric Battellino that Australia was on track to avoid any such thing.
The Treasurer also assured us then that the economy would not shrink as it just has: “All of our advice at the moment is that we will continue to grow . . .”
And one of the key architects of their spend-spend-spend strategy, Treasury secretary Ken Henry, confirmed that this spending was aimed precisely at stopping what we’ve just seen: “Well, of course it’s possible that Australia will avoid a negative quarter of growth. And we’re trying our hardest to make sure that that happens. That we do avoid a negative quarter of growth.”
Except they failed. They got it wrong.
Except that a lot of those things seem to involve politicians receiving advice from experts that turned out to be off the mark. Which leads to a couple of possibilities – perhaps there was genuinely bad advice given, or perhaps it was a difficult situation for making accurate forecasts. How do we partition up the responsibility and blame between those three “causes” – the Government (i.e., politicians), the experts, and the unpredictability of the circumstances? It seems to me it’s a hard task to do, especially when we don’t really know how much blame even exists to be divided up – as Bolt points out, quantifying the effectiveness or ineffectiveness of the Government’s economic initiatives is difficult at best. But many of the examples he lists are of statements made by Rudd and Swan about the advice they were receiving – and not statements of their own beliefs or positions. One counter-argument to this as an argument is the notion of ministerial accountability – that the Minister (e.g., the Treasurer) is ultimately responsible for all of the actions of his Department. But in an area where an elected official is relying on expert forecasts to make decisions, to what extent should the non-expert be held responsible if those forecasts do not come to pass?
Incidentally, Bolt also criticises the first stimulus package as failing to have the intended effect:
Here’s another thing they got wrong. Relatively little of the $8 billion they sprayed into the mailboxes of poorer Australians in December got spent.
Possum attempted to disabuse Bolt of this notion last month, but apparently was unsuccessful.
I am also interested in the connection between this type of column and Mark Latham’s comments in yesterday’s AFR. We have non-expert columnists commenting on the economic management performance of non-expert politicians, who are relying on the best available advice from expert economists. To what extent should the columnists be relying on their own evaluation, and where can they (and we) go to get expert evaluations of Government performance?