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Pyne caught red-handed with the airbrush

Date

Chief Political Correspondent for The Sydney Morning Herald

View more articles from Lenore Taylor

Christopher Pyne ... "I was simply making the point that the Coalition's economic management is better than Labor's."

Christopher Pyne ... "I was simply making the point that the Coalition's economic management is better than Labor's."

Christopher Pyne had his airbrush out yesterday – erasing the entire global financial crisis from Australia's economic history.

"Well if there had been a Coalition government for the last five years ... I think most people accept that we would have had continuing surpluses," he told Sky television.

Actually most people do not accept that.

In 2009, a forecast $20 billion surplus became a $57 billion deficit in part because Labor spent more than $50 billion as stimulus in the face of an international economic meltdown and in part because company tax revenue collapsed due to the financial crisis.

What Coalition leader Malcolm Turnbull said at the time was that we should have spent less on the stimulus – maybe $25 billion or $30 billion. The Coalition waved through the first $10.2 billion stimulus package but opposed the second $42 billion package on the basis that it was too big – and that spending of about $15 billion to $20 billion would have been more appropriate.

It's pretty safe to assume that revenue would have collapsed just the same, no matter who was in the Lodge.

In retrospect, what Mr Turnbull said looks pretty smart (he also argued it was implausible to effectively and efficiently spend $16 billion on school halls in the timeframe proposed and that the pink batts scheme should be means-tested or require a co-contribution from the householders, which might have saved a whole lot of pain) But even if Australia had done exactly as the Coalition said we should do at the time, we'd still have come out of the crisis about $180 billion in debt, rather than $200 billion. And the nation would still have run very large budget deficits.

Mr Pyne has every right to question where the Gillard government intends to get the money to pay for its promises on a national disability insurance scheme and the Gonski education reforms, and it is possible that a Coalition government might have now been in a better fiscal position. But breezy statements that the Coalition would have "got through the global financial crisis quite easily" do not match the facts.

For the record, he told Fairfax Media we were were taking his statements "too literally . . . I was simply making the point that the Coalition's economic management is better than Labor's".

252 comments

  • Christopher Pyne and economic literacy?

    No, there's no link there.

    Stick to points of order, Christopher. Then again, don't.

    Commenter
    gary2002
    Location
    Sydney
    Date and time
    December 10, 2012, 1:34PM
    • Hockey will run the Treasury gary2002. In which case Swan will not.

      Anyone can throw a hundred billion of borrowed funds at an economy and help it. Swan's just lucky he was left with zero debt.

      Overall, if Labor had done nothing about the GFC then the mining sector would probably have kept the GDP growth rate very close to current trend.

      Commenter
      Hacka
      Location
      Canberra
      Date and time
      December 10, 2012, 2:43PM
    • hacka - you are dreaming!

      The mining industry was laying off workers wholesale before the stimulus spending.

      Commenter
      Ross
      Location
      MALLABULA
      Date and time
      December 10, 2012, 2:48PM
    • He should stick to his portfolio........................wnatever that is.
      The trouble with being the "attack dog" is you can neber be taken too seriously on important subjects. TA suffers a bit from that.

      Commenter
      wennicks
      Date and time
      December 10, 2012, 2:50PM
    • Aaaahhhh - of course!!! Hockeynomics.

      The examples I've seen of this much-vaunted economic theory haven't received much acclaim so far. In fact, reviews have at times been quite scathing.

      For Mr Pyne to claim that the scribblers were treating his statements "too literally . . . I was simply making the point that the Coalition's economic management is better than Labor's" beggars belief. He was caught ot - fair and square.

      Will Hockeynomics be allowed to be examined "too literally", or is Hockeynomics based of Fuzzy Logic - the coalition type of fuzzy logic, as opposed to the mathematiically-based Fuzzy Logic.

      Commenter
      gary2002
      Location
      Sydney
      Date and time
      December 10, 2012, 2:53PM
    • Treasurer Joe? What have we done to have that threat made against us?
      I pray we will never see that economic apocalypse.

      Commenter
      Cheesus Crust
      Date and time
      December 10, 2012, 2:54PM
    • Ahh Hacka

      I admire you unwaivering loyalty to the master race (LNP) but read on, If the ALP did exactly what the LNP suggested they would still be $180bil in debt. Again it shows the LNP just refuse to open their eyes and acknowledge the GFC, maybe this statement is apt under the circumstances ****But breezy statements that the Coalition would have "got through the global financial crisis quite easily" do not match the facts.****

      Commenter
      Buffalo Bill
      Location
      Sydneys Northshore
      Date and time
      December 10, 2012, 2:55PM
    • Ross you might want to brush up on your Swannienomics if you think that's the case.

      Isn't it interesting that Swan has never said so much as "thank you" to Costello for the brilliant balance sheet he was left.

      Commenter
      Hacka
      Location
      Canberra
      Date and time
      December 10, 2012, 2:58PM
    • Hacka:
      "Hockey will run the Treasury "

      You mean the guy who blatantly lied to the electorate about having his party's 2010 election costings "audited" when they in fact had an $11 billion black-hole (resulting in two of those who worked on them being fined for breaching professional standards)?

      Let's hope not for the country's sake.

      Commenter
      Think Big
      Location
      Sydney
      Date and time
      December 10, 2012, 2:58PM
    • @Ross - you've got to be dreaming in fact. The stimulus package saved the mining indusry???

      How would that come about. With a free handout to middle to lower income earners primarily spent on ither reducing debt or buying Chinese made plasma television sets I see little impact on the mining industry. Even if you look at the ridiculous school package again you will see no impact on the mining industry.

      Mining is booming due to China and some other Asian countries - nothing to do with the stimulus package. We export our miing resurces we use a minimal amount locally.

      The stimulus package did very little (of any good long term solution) to this country, but kept a lot of people happy as they thought it made a difference. But simple people sometimes need simple solutions.

      Commenter
      Michael
      Location
      Sydney
      Date and time
      December 10, 2012, 3:03PM

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