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Turnbull: we made economic mistakes

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Peter Martin

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COALITION communications spokesman Malcolm Turnbull has crashed into the economic debate, saying the Howard government made bad economic decisions in its final years, ones for which he accepts collective responsibility.

Asked which of the Howard government's decisions were bad, he said: ''This isn't the time or the place, nor would I be able to comprehensively chronicle them all, but I think most of us feel that. Peter Costello clearly does.

''The reality was inevitably the surpluses came in - in those last three years much bigger than forecast - so the government was presented with a lot more money at the eleventh hour, as it were.''

Malcolm Turnbull.

Malcolm Turnbull. Photo: Alex Ellinghausen

Mr Turnbull's view challenges the Coalition's formal position that it was its economic management that produced its repeated budget surpluses.

Mr Turnbull believes the Coalition should have banked much more of the income from the mining boom, perhaps by putting it in a wealth fund managed by the Future Fund. But he said the idea had become less attractive after ''the so-called Keating debt had been paid off''.

''I say this as somebody who has been part of a government and made collective decisions about spending. This is a behavioural economics perspective. From a political point of view my strong belief is that a new sovereign wealth fund would be very much in the spirit of the times, and would become a matter of real national pride.''

He also took issue with those on both sides of politics who want the Reserve Bank to cut interest rates in order to restrain the Australian dollar.

He compared it to the McMahon Coalition government of the early 1970s, whose ''repeated veto of the stronger dollar in 1971 and 1972 stoked runaway inflation''.

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147 comments

  • The worst economic manager in Howard's front bench was Tony Abbott who in the dying months of the Howard Government, in order to claw back votes, introduced the Dental Health Care Plan system as Minister for Health.

    This open chequebook splashing of thousands of dollars for lucky constituents does not depend on clinical need, is not means-tested, is arbitrarily applied, and is a medico-legal minefield for GPs who are asked to administer it with equivolcal guidelines and threats of auditing, and a temptation to dentists to supply work based on the needs of the dentist rather than of the client.

    The scheme sucks billions from the health budged with dubious results.

    Abbott in particular, and the Libs in general, should not be trusted to manage an economy.

    Commenter
    Ross
    Location
    MALLABULA
    Date and time
    April 20, 2012, 8:14AM
    • Ross can you tell us if Labor after being in government for 4 years has ended this 'wasteful' dental health scheme. if not one suspects your complaint is really motivated more by personalities than policy.

      Commenter
      SteveH.
      Date and time
      April 20, 2012, 9:12AM
    • We have seen that will both Joe and Malcolm coming out and admitting that Howard and Costello got it wrong, very wrong. Sure lets have them take the reins again.

      Commenter
      Peter
      Location
      VIC
      Date and time
      April 20, 2012, 9:20AM
    • Once again, Mr Turnbull is showing the way, unlike Abbott, who will make huge spending promises to get into power.

      Let's face it, with Joe Hockey slashing welfare, Abbott increasing middle class welfare (paid maternity leave) and Barnaby Joyce telling us Australia is almost bankrupt, we will be in a mess two years from now. What a bunch of economic incompetents!

      Commenter
      Peter
      Location
      South Yarra
      Date and time
      April 20, 2012, 9:24AM
    • So the BER, Pink Batts, Cash for Clunkers and $900 handouts were good economic policy???

      Commenter
      Gay Refugee
      Location
      Canberra
      Date and time
      April 20, 2012, 9:37AM
    • Their economic credentials was all they had going for them ... what have they got now???
      Howard was not a good economic manager anyway (considered one of LNP's best). It might win votes to pay more money to the well off, but it is not sensible money management.

      Commenter
      Yuppy
      Location
      Yuppy Ville
      Date and time
      April 20, 2012, 9:42AM
    • SteveH - Your point is right, Labor has not abolished this scheme. In some ways, it is not much better at economic management than the Coalition. On the other hand, we GPs lose so many fights with patients who tell us. "My neighbour got his $4,500. How dare you stop me getting mine?"

      As to my motivation? Well, I object to people labelling the mediocre economic management of John Howard who governed during 20 years of economic sunshine, as being superior to that of Rudd and Henry and Stevens who navigated the economy through the most savage economic hurricane in 80 years.

      And even if ALP economic management may not be superior to that of the Libs, at least they don't crow that the triumphs are due to their own brilliance and the failings due to overseas factors beyond their control. In fact the ALP for reasons unkown to me has downplayed its economic success - and for that alone we should be grateful.

      Commenter
      Ross
      Location
      MALLABULA
      Date and time
      April 20, 2012, 9:48AM
    • Gay Refuge,
      Yes, Insulation scheme, $900 cash back and BER were very good economic tools. There are many reports and economists to back this up. They may have not been 100% rolled out as efficiently as the ycould be if time was on a government's side but it was not and the times required serious and swift response to a GFC.
      Cash for Clunkers on the other hand was not such a good policy but was done to save the car industry when GE pulled out of financing cars & the GFC hit. The 100% write off for 08/09 was good policy becuase businesses went out and bought vehicles.

      Commenter
      Econorat
      Location
      Sydney
      Date and time
      April 20, 2012, 10:01AM
    • @ Gay Refugee

      Well yes, they mostly were mostly good policies that helped save us from the GFC, but executed poorly by Labor. That’s the choice we have at the next election…. Labor will head in the right direction slowly and with mistakes, but Abbott will achieve his terribly damaging policies with lightning efficiency! For example MRRT money returned to the billionaires faster than we can blink for example! Then Beasley will introduce ‘Work Choices v2.0’ and cut away the safety net.

      Commenter
      QED
      Location
      Sydney
      Date and time
      April 20, 2012, 10:16AM
    • It's interesting to hear from a senior Lib that there was waste and some wrong decisions. I'm also fascinated by the comment of the "so called Keating debt". If it wasn't for Keating the LNP would not have had the years of surplus (they've admitted this themselves). The pity is that they squandered the good times to provide middle class welfare whilst leaving us with a structural deficit and did not undertake any reform other than the GST, the Alice Springs to Darwin railway and Workchoices. Overall the LNP lack vision and they have always been like that. I'd be interested to hear any visionary policies of the LNP?

      From what we've heard so far from Abbott he will cut $70 billion, comprising of slashing some good visionary policies (NBN, carbon tax), and now welfare (but I bet not middle class welfare - baby tax and now the nanny tax). They're also advocating paying polluters for no return (direct action) that will cost every Australian $1300 per year. At least what Labor proposes will lead to a new energy and sustainable future, a new digital future (NBN) spending on infrastructure, education, disability insurance, hospitals.

      And before the rusted on Libs start their mantra of the lie I think if you add it up they all lie, just some more than others, that is, Abbott see http://www.thepoliticalsword.com/post/2012/02/19/Tony-Abbott-we-are-sick-of-your-lies.aspx

      Commenter
      n720ute
      Location
      North Coast NSW
      Date and time
      April 20, 2012, 10:59AM

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