A document was leaked from the Australian Bureau of Statistics which showed it is planning to sack around 200 staff to pursue efficiency dividends to allow a pay rise to occur. I was interviewed by ABC economics commentator Stephen Long as part of a segment he put together on the national ABC current affairs show PM tonight which examined this issue.
Click for the full Transcript of the segment.
Click for the full mp3 podcast
My views are obvious from the piece. But what Stephen edited out to make the segment work within his time limit was a comment I made about pro-cyclical fiscal policy. The point is that critics of fiscal policy activism have argued that because data is so lagged in getting to us, aggressive fiscal interventions (like a stimulus) sometimes take too long to implement and by the time they are impacting the private business cycle has turned anyway – thus, making the fiscal policy a further growth surge with the danger of inflation. Counter-cyclical policy, instead, aims to fill the burgeoning spending gap left by the evacuation of private spending. The point is that you not only need timely data but also good data. I cannot see why you would cut spending to the Australian Bureau of Statistics.
Digression: WorkChoices dies, arise WorkChoices Lite
Well today the Senate finally signed off on the new Fair Work Bill. I guess it is a time to be happy. But given that workers in small businesses are not protected for the first 12 months from capricious behaviour there really isn’t much to be happy about. Not to mention the failure to reinstate proper Safety Net procedures for setting the minimum wage. But at least the last regime is slowly being taken out of the statutes.