Meltdown continues at the Oz
The Australian has long since ceased to be a serious newspaper. Its opinion pages are devoted to recycling talking points from the US-centred rightwing parallel universe (some more serious conservatives have described it as the “conservative cocoon”, a term coined by conservative blogger Ross Douthat, recently elaborated here). Its political writers, who straddle the gap between news and commentary have long been in the tank for the conservative parties or for particular conservative politicians. Its war on science (Tim Lambert is now up to instalment XXII and he’s not comprehensive) has long passed beyond the point of absurdity.
Even so, I don’t think I’ve seen a front page headline as brazenly defiant of the facts as today’s. Having claimed, falsely, that the Reserve Bank opposed the government’s deposit guarantee, and been put down, mildly but firmly, by RBA Governor Glenn Stevens, the Oz doubles down and announces a “backflip” on the basis of the marginal adjustments discussed here yesterday.
For the correct story, you have to go the Fin (paywalled unfortunately). While the Fin is just as rightwing as the Oz on most issues, its readership consists primarily of businesspeople who need accurate information, not delusional rightwingers who need their prejudices confirmed. From the Fin it is clear that the Bank pushed for an unlimited guarantee (for much the same reasons as given here) and that it was Treasury that initially wanted the silly $20 000 limit.
The Oz is now essentially worthless as a source of information. Some individual journalists are still pretty good, and articles with their bylines are worth reading. But if their weather report predicted sunshine, I’d pack an umbrella, just in case.
Update The Oz goes for the trifecta, despite their claim that the RBA opposed an unlimited guarantee now being denied outright by both Glenn Stevens and Ken Henry. They have a document showing that the RBA wants to charge wholesale depositors directly for the guarantee and using the term “cap” to describe the amount that would be used to distinguish between wholesale and retail. This kind of ex post tweak is unsurprising, but still news and if the Oz had stuck to that a couple of days ago, they (and the Opposition) would be in less trouble now. Instead they have beaten it up into a full-scale war with the Government, Treasury and RBA which is going to cost them a lot in the long run.
To restate the point, the original announcement said nothing (at least nothing I saw) to indicate that the government guarantee would be free, and deposit insurance schemes normally involve a premium. In due course, I expect that the government will charge the protected institutions for the guarantee. It’s turned out to be necessary to move more quickly at the wholesale level, but this is a step in the right direction. The silly pointscoring of the Opposition (and its representatives in the press) is grossly irresponsible.