Voters understand better than commentators the trickery of state budgets

That’s the title of my latest piece in the Guardian.
Opening paras

Privatisation has been the last fiscal resort of desperate governments for decades. By now, just about everyone in the community understands that the supposed windfall achieved by selling income generating assets is spurious. Voters have routinely tossed out governments that have advocated or implemented privatisation, sometimes by stunning margins.

The only people who haven’t got the memo are the politicians who make budget policy and the journalists who write about it. The politicians’ reluctance to abandon privatisation is understandable if discreditable: when electors throw them out, they are virtually guaranteed a lucrative post-political career in the financial sector.

The failure of political journalists to understand what they write and talk about for a living is more surprising. Yet the coverage of the Queensland and NSW elections suggests that there has been no improvement in understanding of the basic issues.

Turnbull’s class war

The right is fond of decrying as “class war” any proposal that would benefit Australian workers and low income families. But, we finally have a genuine “class war” election in view and it has been launched by Malcolm Turnbull, with his attempt to tie future governments into massive income tax cuts for high income earners.

The good news here is that, despite some wavering, Labor held its nerve, opposed the second and third stages of the package and voted against the entire bill. Some people (I imagine the kind who call themselves “hardheads”) were worried that defeating the entire bill would be hard to explain to voters. They didn’t apparently consider how they would campaign against regressive policies they had already voted for (or maybe they supported those policies).

In any case, voters in Australia finally have a clear choice. Massive tax cuts for companies and high income earners, or a progressive tax system that provides the revenue we need to provide decent public services. It seems that a majority of younger voters, at least, know where they stand (more on this soon, I hope).

Economics in Two Lessons, Chapter 13

Thanks to everyone who commented on the first twelve chapters of my book-in-progress, <em>Economics in Two Lessons</em>.

Here’s a draft of Chapter 13 on Redistribution

Comments, criticism and praise are welcome.

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Earlier draft chapters are available. These aren’t final versions, as I am now editing the entire manuscript, but you can read them to see where the book is coming from.

<a href=”https://www.dropbox.com/s/ilqwwru858rihrl/QuigginTwoLessonsDraftTOC.pdf?dl=0″>Table of Contents</a>
<a href=”https://www.dropbox.com/s/d8x2dp5sbxi70er/QuigginTwoLessonsIntroductionRevised.pdf?dl=0″>Introduction</a&gt;.
<a href=”https://www.dropbox.com/s/ao6s4jaejbrzap1/QuigginChapter1Revised.pdf?dl=0″>Chapter 1: What is opportunity cost?</a>
<a href=”https://www.dropbox.com/s/r1k8iqcpeboosbh/QuigginChapter2Revised.pdf?dl=0″>Chapter 2: Markets, opportunity cost and equilibrium</a>
<a href=”https://www.dropbox.com/s/x4umnbwj4kmihd6/QuigginChapter3Revised.pdf?dl=0″>Chapter 3:Time, information and uncertainty
</a><a href=”https://www.dropbox.com/s/s2fkdwmbmje6fdo/QuigginChapter4Draft.pdf?dl=0″>Chapter 4:Lesson 1: Applications</a>.
<a href=”https://www.dropbox.com/s/pmml30mkozzj9j5/QuigginChapter5Draft.pdf?dl=0″>Chapter 5: Lesson 1 and economic policy</a>.
<a href=”https://www.dropbox.com/s/44bvl01adcv2fte/QuigginChapter6Draft.pdf?dl=0″>Chapter 6: The opportunity cost of destruction</a>
<a href=”https://www.dropbox.com/s/23d7veamse5wnde/QuigginChapter7Draft.pdf?dl=0″>Chapter 7: Property rights, and income distribution</a>
<a href=”https://www.dropbox.com/s/eoc19utnfhvtk47/QuigginChapter8Draft.pdf?dl=0″>Chapter 8:Unemployment</a>
<a href=”https://www.dropbox.com/s/ovvuu5kzgc7f33t/QuigginChapter9Draft.pdf?dl=0″>Chapter 9: Market Failure</a>
<a href=”https://www.dropbox.com/s/00menn8garip6y3/QuigginChapter10Draft.pdf?dl=0″>Chapter 10: Market failure -Externalities and pollution.</a>

<a href=”https://www.dropbox.com/s/7815grsyp24nfuf/QuigginChapter%2011%20%20Market%20failure.pdf?dl=0″>Chapter 11: Market failure: Information, uncertainty and financial markets</a>

<a href=”https://www.dropbox.com/s/seojgihd4mrkcrq/QuigginChapter%2012Draft.pdf?dl=0″>Chapter 12 on Predistribution</a>

Feel free to make further comments on these chapters if you wish.

User experience

As I mentioned a while ago, after years of having the blog managed for me by Jacques Chester (thanks again!) I’m now out on my own. I’m working through WordPress.com. A reader has mentioned that the process of commenting has become burdensome, something I’ve noticed with the default WordPress setup. I’ve tried to fix this by removing the requirement for an email address.

I’d appreciate it if readers could comment on what happens when they try to post a comment. If you can’t comment at all, please email me at j.quiggin@uq.edu.au

Black helicopters and the Fairfax press

I’ve mostly given up talking about the nonsense published on a daily basis in the Murdoch press. There are more reliable alternatives, after all. At least so I thought until I looked at today’s Fairfax papers, which ran, as the lead, a piece from Peter Hartcher headlined Beijing uses infrastructure as friendly forerunner of political power. It’s as obviously loopy as anything Maurice Newman has written on Agenda 21, or Graeme Lloyd on Climategate
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Maybe we need a degree in Western Civilization after all

I’ve kept out of the latest silly culture war so far, but I couldn’t resist this from Josh Frydenberg. After decrying a “long march to the left” in Australian universities, he says

It is absolutely critical that the next generation of students understand about where the rule of law came from, where democracy came from, freedom of speech, freedom of religion, women’s suffrage

Looking through that list, it can be described as a potted summary of the “long march to the left”  in Britain (and by extension Australia) over the course of the “long 19th century” from the French and American revolutions to the outbreak of the Great War.  At the beginning of that period, Freydenberg’s conservative precursors supported the rule of law, and opposed democracy, freedom of speech and religion and women’s suffrage. It was only after long struggles that restrictions on freedom of speech and religion like the Six Acts and Penal Laws  were repealed. The fight for (initialy male-only) democracy and women’s suffrage took even longer.

If we extended Frydenberg’s list into the 20th century, we’d get something like this University of Sydney course which covers

struggles over labour rights and working conditions in the 1900s, women’s suffrage, Aboriginal land rights, race relations and the White Australia Policy, homelessness during the Great Depression, freedom of speech during the Cold War, the Vietnam Moratorium and sexual liberation in the 1970s, the environmental movement, refugees and asylum seekers, and LGBT rights today

This course was denounced by Bella d’Abrera of the Institute of Public Affairs in a piece supporting the need for a Western Civilization course. It’s notable that free speech and women’s suffrage occur both in Frydenberg’s celebratory list and d’Abrera’s denunciation. I’m guessing that, if pressed, d’Abrera would not defend the implication that these, and other items like the end of the White Australia policy, were things to be deplored. But it would be interesting to see her present a version of history in which all the freedoms we now enjoy appeared magically and without any strugge.

Looking at this mess, I think we might need a course in the history of Western Civilisation after all. It should be provided to people like Frydenberg and d’Abrera so they can decide exactly whether they want to stop the clock at 1970, 1950 or perhaps at 1900.