God I Hate Football

My daughters are both happy this morning. I wonder if it would be considered an act of cruelty were I to encourage them to become football fans? As a fan of the Adelaide Crows, today I am in pain. It’s not the first time, it won’t be the last. My daughters do not know this pain yet, and while I look forward to the time when we sit as a family and watch the footy, part of me wants to spare them the despair all football fans know.

There is nothing worse than your team losing a final. Except if your team loses after leading by a large amount after the first quarter. The only thing worse than that is if your team loses after regaining the lead in the last quarter. Except if your team loses after regaining the lead again in the last minute. And the only thing worse than that is if your team loses after giving away a free kick with 20 seconds left to play allowing the opponent to kick the winning goal.

Today Crows’ fans are thus feeling the worst pain possible to any football fan. Well, I guess it would be worse if it had been a preliminary final, or (God spare us) a Grand Final. But for Crows’ fans today that is small consolation. No day will ever be worse; nothing will ever take away the pain.

The greatest film about being a football fan is Fever Pitch. The adaptation of Nick Hornby’s novel is actually better than the book (and please, for the love of God don’t watch the American version which converted a football fan into a baseball fan). In the film, Colin Firth plays mad Arsenal fan, Paul, who when reacting after a particularly unexpected and horrific loss screams at his girlfriend (and non-football fan) when she suggests “It’s only a game”:

DON'T SAY THAT! Please! That is the worst, most stupid thing anyone could say! Cause it quite clearly isn't "only a game." I mean if it was do you honestly think I'd care this much?

Says it all really. Of course it is only a game; and yet last night after the match I wanted to cry. I couldn't though, because I was in shock. I couldn’t believe we had blown a 5 goal lead – gone from looking like world beaters, to suddenly being unable to hand pass to a team mate 5 metres away. Throughout the third quarter it got so bad I had to switch off the TV and went to just listening to the match on the radio stream on the net, in the vain hope that this act might change things.

Football (and sport in general) does this to fans. If my sitting on the toilet during the entire match would mean the Crows would win, even though it meant I wouldn’t actually see it, I would do it in a heartbeat. During summers when I was young and my favourite player, Greg Chappell, was batting in a test match, I would make myself sit in the same position every time he faced a ball during his innings – as though my doing something different might somehow alter the universe in just the slightest amount that would then mean Chappell would edge the next delivery to the wicket keeper. Call it the sportsfan’s chaos theory – you don’t want to do anything that might be the equivalent of a butterfly flapping its wings in Brazil causing a tsunami in Japan.

The stupid thing about it all is that I don’t even like watching football. Well of course I do like it – heck I love it; I long for the start of every season, we got Foxtel purely so we could see every Crows' game. But I don’t think I can ever recall actually enjoying watching the Crows play a match. I don’t look forward to watching them – beforehand I am full of nerves and prophecies of doom mixed with specks of hope and “whatifs”. During the match, I am never confident, never able to relax, never able to savour the moment. OK, I lie – I did enjoy the last couple of games by the Crows against Essendon and Carlton, but only because we flogged both of them. Even in those games I was only really able to relax and enjoy myself once the Crows were 10 goals up with a quarter to play (and even then… they get the first couple, we go off the boil… it couldn't happen could it???).

And yet… and yet (sigh)…. I know I would never miss a game – I organise my life around the Crows’ matches, and a good weekend can be gauged by whether they won or lost. It’s stupid; however, I know I won’t be able to change things. I am doomed. I will, for the rest of my life, be destined to be addicted to the drug of a Crows’ win.

But geez, the depression from a hard loss is viscerally hard. And it is what separates the occasional fan from the true believer. It’s why Collingwood fans still bristle when talking about the 1979 Grand Final; it’s why Geelong fans don’t find much consolation in having been in perhaps one of the best Grand Finals of all time in 1989. It’s why North Melbourne fans try to have a collective amnesia about the 1998 Grand Final and instead recall only 1996 and 1999.

Losing isn’t so bad – it’s losing when you think you should have won that really hurts. That inability to compute the fact that even though you were the better side you lost, and that the better team didn’t win… and yet of course you know deep down that’s a lie; the best team always wins, you just can’t bring yourself to think that and so you force those thoughts back down inside. And in this instance I can’t even blame the umpire – the free kick was there (why Rutten? Why??). I can however harbour hatred at Channel 10’s standard Collingwood-biased commentary and production (do we really need to see shot after shot of the reprobate Collingwood fans giving players the finger? We know Pies’ fan can’t count past one, but do we really need photographic proof of that shown every other minute?).

The only good thing about losing in a non-Grand Final is that Crows' fans will be able to gain some healing should Geelong beat Collingwood next week – because schadenfreude is the footy fans most helpful emotion – losing isn’t so bad, so long as your nemesis is then defeated as well. Should Collingwood go on and win the flag, Crows' fans will forever be stuck thinking that had we held on for that last 20 seconds it could have been us. It’s why Bulldogs fans break out in shivers at the memory of 1997.

So while I probably won’t watch next week’s game – It would hurt too much – I will be able to enjoy the Grand Final the following week so long as Collingwood is not there, and I can say to myself, oh well, the Cats would have beaten us anyway… it doesn’t matter.

And yet it does matter. It will for a long time. And it’s why I can’t wait for next year’s season, and why I will again sit down, ready to put my emotions on the line every weekend, hating every minute, but doing so because of the utter feeling of pure bliss after each win.

But please God, make sure Collingwood loses against Geelong.

On the QT: Bad News Bears Edition

Kevin Rudd answered only two questions in Question Time today – the first was a Dorothy Dixer on the economy, but it was possibly his best ever answer. He was actually funny – to the point where you wanted him to keep going. Yes, Kevin Rudd was on fire. But then, it’s easy to be funny when you’re working with great material, and today Rudd had two good script writers – the Australian Bureau of Statistics and Joe Hockey.

The ABS helped Rudd by showing unemployment had remained stable at 5.8%.

This is excellent news, but hardly that which would have you cheering from the rooftops

– especially when you look at the figures of actual employed persons:

So yes unemployment is stable, but less people have a job than before (the participation rate dropped as well – ie there were less people looking for work, which is why the actual unemployment figure remained the same).

So this was good news for Rudd – in fact, it was perfect news. The stable unemployment figure allowed him to argue that the stimulus was helping slow unemployment, but the actual employment figures allowed him to also argue that the Government needs to keep the stimulus going because the economy is still shaky.

Had the ALP been able to manufacture the unemployment figures themselves I doubt they would have come up with anything more politically helpful than what actually has occurred.

Little wonder the opposition wheeled out only Joe Hockey, with Turnbull laying very low. Unfortunately for the opposition, Joe decided to open his mouth.

Now firstly this morning Hockey was interviewed in The Australian newspaper and for absolutely no good reason decided to commit the Liberal Party to cutting Government spending by more than 3% of GDP or around $40 billion. Yep good luck with that as an election strategy Joe. But just when you think he couldn’t do any worse he came out with this beauty at his press conference (thanks to Bernard Keane at Crikey for the transcript):

“So you’re saying,” one journalist asked, “it is more important to keep interest rates low than to spend money to keep people in work?”

“Yes, yes,” Hockey replied.

At the time, 2UE journalist Latika Bourke wrote on her Twitter:

Shadow Treasurer Joe Hockey says keeping interest rates low is more important then spending money to protect jobs.

She may have well have written the ALP’s line of attack.

Just think about what Hockey – the former Minster for Employment and current alternative Treasurer of Australia – has said. Ask yourself if you had a choice between losing your job or having to pay 1% more on your mortgage, which would you choose? In fact ask yourself how much interest rates would have to rise before you would rather give up your job. If you are like me you are thinking never. The cash rate could hit 10%, but I’d rather have a job than it be at 3% and be unemployed. Yes it’s hard to make repayments when your mortgage goes up, by it’s a sight more difficult when the mortgage stays the same but your income disappears.

It’s a no brainer. And yet Hockey chose losing his job. Though he won’t actually lose his job, because supposedly he is the Liberal's next leader after the election. But his performance in the last 24 hours shows that he’s not really up to the main game, and is only a good second banana – someone best kept to the easy-lifting portfolios. As Shadow Treasurer he has been a bag of wind with little puff.

And so in Question Time, Rudd made merry with Hockey’s statements. He also had fun with Hockey’s tweet from yesterday’s Question Time when he wrote:

listening to swan on the G20 and i am wondering how many finance ministers he met are left wing

Rudd turned this into an assessment that Hockey thinks the G20 is some great left wing conspiracy. He laughed as he recounted the efforts that great left winger from Higgins (Peter Costello) had put into forming the G20. He then listed off some right wing leaders from the G20 nations such as Sarkozy the Socialist and Berlusconi the Bolshevik. It was all pretty good, and shows that Rudd is a good parliamentary performer when he lets himself drift from the standard script.

He was probably in a relaxed mood because he had some more good news up his sleeve. For his next answer to a Dorothy he announced a $70b Gas deal to Japan and South Korea.

Stable unemployment, dumb statements from the opposition and a huge export deal? Does it get any better when you are PM?

The rest of the front bench jumped into Hockey as well – Wayne Swan suggesting at the next G20 meeting they’ll all break out into a few verses of the “Internationale”. Swan also produced some interesting research done by his office that found that since Turnbull has become leader when the unemployment figures go up Turnbull comes out and does the press conference; when they go down or are stable he stays away and lets Hockey do the presser. Julia Gillard got into him as well on this point labelling Turnbull “the political undertaker; he only turns up when there's bad news”.

This fits nicely in with the ALP’s continuing theme of Turnbull – Mister Negativity; no strength (only turns up when it suits him). It got so bad that Lindsay Tanner was comparing him to John Hewson (which means that Turnbull has so far been compared with Andrew Peacock, Hewson and Mark Latham – not a winning trifecta).

In between all this frivolity for the ALP, Julia Gillard was again targeted for every single thing wrong, going wrong, or seeming like it could perhaps be thought to possibly be wrong with the education stimulus. Now there is nothing wrong with taking a micro approach to questions – the ALP did it well in 2007. But the problem with the Liberal Party is there is no big picture attached. When the ALP in 2007 asked about specific people who lost their jobs under WorkChoices, the big picture was they were going to get rid of WorkChoices, and that the policy did not increase productivity like it was supposed to; rather it merely killed workers’ entitlements. But what is the broader picture to nitpicking the education stimulus? Sure you need to hold Government to account, but why is the opposition doing this? Do they oppose the spending – well yes, but why? The stimulus was put in place to keep unemployment down and growth up. It has done this. The Libs argue about interest rates – but that puts them back to where Joe Hockey was – arguing interest rates are more important than jobs.

There’s no underlying big strategy, no policy framework, and certainly no big statistical proof to support their case. Also the ALP were on a winner in 2007 because WorkChoice was as popular as syphilis at a brothel. Is anyone out there marching in the streets demanding the Government not spend money at their kid’s school?

There are two other problems with this strategy. The first is that Gillard is killing them. Some in the media thought she was a bit sluggish early in the week, but she creamed them today. The other problem is the Libs have gone to such micro lengths that you half expect them to ask Gillard about the leaky tap at the Murray Bridge South Primary School shelter shed. Micro is fine; trivial is not.

There are times to focus on the small things, and there are times for the big picture. At the moment in the gallery of the economy the big picture reigns supreme, and it has been perfectly framed by the ALP. There’s little the Libs can do except try not to look like they are standing there with a texta getting ready to deface it.

On the QT: Spelling Bee Edition

At the Parliamentary doors this morning, Senator Steve Fielding was asked to explain why he wanted the Governor of the Reserve Bank to appear before a Senate Hearing on the stimulus package (you know the one which we had a hearing on last year, and was then discussed at Senate Estimates hearings in February and then again in May). He had been heard earlier saying that he wanted monetary and “physical” policy to work together. The journos were obviously wanting clarification on just what was “physical” policy.

He cleared it up by saying he meant “fiscal policy. He should have stopped there, except he then went into Dan Quayle territory:

“I'll make it quite clear: fiscal, F-I-S-K-A-L."

When a journalist repeated his misspelling, Fielding corrected himself and said:

"F-I-S-C-A-L. Yeah, fiscal." (He knew straight away he had been caught in a “bugger” moment, and he knew it would also get a lot of airplay).

Later in the day he came out and said he suffered from a “learning difficulty”, which meant he struggled with English. Suddenly, according to some media types, we were not allowed to laugh at his misspelling, and instead should be thinking he was brave to admit his problem.

Please. For a start, he was the one who decided to try and spell the word, so it’s not like he was being picked on; and second, learning “difficulty”? I had a difficulty learning maths, tech studies, and pretty much anything that involved chemicals and equations with electrons. It’s called having different strengths, and it’s why I don’t go about stating the chemical make up of sodium nitrate, explaining how a cosine is used in trigonometry, nor ever try to make anything from wood with a band saw. (I’m also pretty hopeless at spelling, despite having a PhD in English Lit, which is why I would never spell words out loud to the national press). Sure, maybe he has dyslexia, fair enough – that is a “disorder” (not a disability – would you describe someone with dyslexia as “disabled”?), but I haven’t seen anywhere him saying that is what is his “difficulty”. If it is dyslexia, then why not admit that? Wouldn’t it be good to show people that dyslexia is not an impediment to becoming a Senator? (as if anyone nowadays wouldn’t think that anyway).

Of interest as well is that in the media “difficulty” quickly became “disability” or “disorder”. My daughter has Down Syndrome – that’s a disability, being useless at English is not. (Is it too much to ask the media be correct on a story that originated due to someone spelling a word incorrectly – or is it the case that the spelling of words is more important than their meaning?)

Anyhoo, the fact is those from the left who attack Fielding don’t do it because he can’t spell, they do it because he got voted in on less than 2% of the vote, takes advice on climate change from people who think the link between cigarette smoking and cancer is overrated, and because he comes out with dopey statements such as that his voting against an increase on the tax on alcohol “broke the back of the alcohol hold on Australia”. 

But look, Fielding is a small potatoe (as Dan Quayle would say); the big events were happening in the House of Reps. Which is to say, nothing of any import was happening.

Here’s the shorter version of today’s Question Time:

Opposition: Lindsay Tanner, why won’t you wind back the stimulus?
Tanner: You’re kidding aren’t you?

Today the opposition seemed to target Tanner – ignoring Rudd completely. I’m not sure who the bright spark in the Liberal Party room is who thinks Tanner is the ALP’s weak link in Question Time, but I suggest they are displaying all the signs of a learning difficulty.

Turnbull, displaying that he has yet to learn how to ask a question in Parliament, quoted a speech by Tanner from 2007 in his question to Tanner, which meant Tanner could bring up everything else he had mentioned in that speech (which included attacks on the Howard Government advertising, Regional Rorts, etc, etc).

It was all a bit pointless and dull. The opposition alternating between nit picking the education stimulus and trying to attack Tanner because the stimulus is working too well.

The upshot is that this Friday Ken Henry and Glenn Stevens will rock up to the Senate and say absolutely nothing startling – interest rates are at rock bottom and will go up because they are at expansionist levels. The stimulus should remain, but there shouldn’t be any further cash handouts (which there aren’t any), and stimulus should now be targeted at mid to long term infrastructure projects (as it already is).

But I guess it’ll give Senators Abetz and Joyce another chance to battle wits with Ken Henry. Anyone wondering who will win? I thought not; on that subject no one has any difficulty.

Flick of the Week: “I am constantly surprised that women's hats do not provoke more murders”.

Having been in Adelaide today and was flying back home during Question Time, I’ll leave On the QT till tomorrow and instead get around to doing a A Flick of the Week (which I must admit is struggling to live up to its name given the rare times I get around to writing one).

This week’s Flick of the Week takes us with the great German singer, actress, entertainer, Marlene Dietrich from Touch of Evil to the film she made immediately prior to that, the adaptation of the Agatha Christie play, by director Billy Wilder, Witness for the Prosecution.

I have to admit not having seen this film for many a year. I’d venture it has been well over a decade, and given I can get it from Amazon for $12 I should put in an order. Despite (or perhaps because of ) the time since I last saw it, I have to say this is an old favourite. It is a great courtroom drama – in fact as it was made before Inherit the Wind, To Kill a Mockingbird, Judgment at Nuremburg, and Anatomy of a Murder it is really the Granddaddy of all courtroom movies – that puts a primacy on keeping the viewer guessing and entertained. In a world of Law and Order: Adnauseum it is nothing new to have courtroom scenes with surprise evidence, and witnesses being economical with the truth, and so we may feel inured to all attempts at surprise from the courtroom – unless it involves even more shocking revelations “that will make you question humanity” (as often seems to be the case on the Law and Order shows). But Agatha Christie is not of that school. She was making people guess whodunit before dun knew who it was.

The plot involves eminent barrister, Sir Wilfred Roberts (Charles Laughton) , who is recovering from a heart attack, taking on the case of Leonard Vole (Tyrone Powell) accused of murdering the rich, elderly Mrs French (the motive being that she had recently changed her will to leave him the majority of her estate). But those are just the bare bones of the story that leads back to post wartime Berlin, includes bigamy, disguise, double cross upon double cross, and brandy in a cocoa thermos.

Marlene Dietrich plays Vole’s German wife, and she give a tour de force performance. She would only appear in only two more American films (Touch of Evil and Judgement at Nuremburg), and if you’ve ever wondered what the fuss about her was, this is the film to see – she not only acts, but she also has a scene singing in a German nightclub where she gets to show off her famous legs.

Charles Laughton though is the frame on which Wilder drapes his film. The dialogue by Wilder and Harry Kurnitz is (as is always the case with a Wilder film) sumptuously witty, and Laughton absolutely eats it up. He delivers his courtroom scenes in a manner that has you deciding he is the only man you would want defending your life, but also wonderful is his interplay with his nurse which is done in a brilliantly irascible manner.

The film was nominated for six Oscars, but won none (Bridge on the River Kwai was the film that year). It famously ended with the line:

The management of this theatre suggests that for the greater entertainment of your friends who have not yet seen the picture, you will not divulge the secret of the ending of Witness for the Prosecution.

And in that spirit, I will not reveal any more of the plot, except only to say that unlike a number of twisty, plot driven films, this one is enjoyable to watch even if you do know the ending.

Previous Flicks of the Week:

Touch of Evil – Orson Welles
The Third Man – Trevor Howard
Brief Encounter - David Lean
Lawrence of Arabia – Claude Reins
Casablanca – Humphrey Bogart
The Big Sleep – Howard Hawks
His Girl Friday – Cary Grant
Charade – John Williams
Schindler’s List – Liam Neeson
Love Actually – Emma Thompson
Sense and Sensibility – Ang Lee
Crouching Tiger, Hidden Dragon – Michelle Yeoh
Tomorrow Never Dies – Pierce Brosnan
The Thomas Crown Affair – Renee Russo
In the Line of Fire – Clint Eastwood
Where Eagles Dare – Richard Burton
Zulu – Stanley Baker
The Guns of Navarone – Peter Yates
Breaking Away – Dennis Quaid
The Right Stuff – Ed Harris
The Rock – Sean Connery
The Longest Day – Richard Beymer
West Side Story – Ernest Lehmann
North By Northwest - The first one.

It’s still broke, still needs fixin’

Yesterday I came up with a graph that looked at the quarterly growths in GDP across a range of major economies. I couldn’t be buggered doing a graph for annual changes in GDP, but thankfully Peter Martin has done it for me! It’s a graph that is pretty sobering to look at:

It doesn’t take a genius to see that Australia has done pretty bloody well over the last 12 months compared to the rest of the world, and it also shows just how bad things are in the rest of the world. Look where Japan – our biggest trade partner – is located. Imagine life in the UK right now. If you’re wondering why Obama’s satisfaction ratings are going down, a look at the negative GDP growth in the US in the last 12 months will give you some indication (even though he can hardly be blamed given the God awful mess he inherited).

But Australia? It’s the little nation that could.

Why do you think we are where we are? Magic?

No. It is because interest rates are at break-the-glass-we-have-an-emergency level, and because back in October 2008, when the rest of the world was about to plunge off the economic cliff, the Rudd Government went into economic stimulus overdrive.

The GDP growth was consumer led. As Martin writes:

Driving the rebound was an 0.8 per cent bounce in household consumption in the quarter, built around a 2.5 per cent splurge in spending on clothes and shoes and a 1.9 per cent binge in spending on furniture and household equipment.
Business investment in equipment jumped 5.6 per cent, spurred by generous depreciation allowances in the May Budget.

Now here’s the thing; yes we’re in the positive for GDP growth, but still well below what you would consider average growth – unless you think 0.6% annual growth is good (in which case I just hope you’re not my superannuation fund manager).  Take away the stimulus now and do you seriously think that pathetic little growth will sustain itself? Really? Why? Have a look at all those other economies – you know our trading partners. Do they look like they’re gearing up to start buying heaps of our exports? Take away the stimulus and just what do you think will sustain GDP growth? Prayers and wishes?

And yet here’s Joe Hockey last night on Lateline:

JOE HOCKEY: … the problem is that all the money the Rudd Government has spent is leaving us with a burden that is going to impair our economic recovery over the next few years. We've now got seven years of deficits for what appears to be five minutes of economic downturn with one negative quarter and it's a massive price to pay for a new school hall.
LEIGH SALES: How far should the stimulus be wound back, then, in your view?
JOE HOCKEY: It should be wound back significantly.
LEIGH SALES: What does significantly mean?
JOE HOCKEY: When you actually look at the entire package that the Rudd Government rolled out from the Budget in 2008, they committed over $100 billion of new extra-spending initiatives over the forward estimates. Forty per cent of that money kicks in after the 1st of July next year. And Australians need to ask themselves: why will interest rates go up, why will interest rates go up whilst the Rudd Government is continuing to spend money?

I doubt I have every heard anything so dumb coming from a front bench politician not named Julie Bishop. Joe Hockey, who would have you believe is qualified to be Australia’s Treasurer, believes the reason interest rates will rise from 39 year lows is because of the stimulus. On that reckoning he therefore must think that interest rates should – all other things being equal – stay at 3%. Yep; despite the fact that the lowest interest rates ever under the 11 years of the Howard Government was 4.25%, Hockey now thinks a rate over 25 percent lower than that “record low” should be the norm.

A complete dill. I would love a journalist to ask either Hockey or Turnbull what they think is a non-stimulatory level of interest rate.

Today in Crikey, Bernard Keane wrote a brilliant piece that nailed this bull about winding back the stimulus for what it is:

The “debate” over whether the Government should pull back on the stimulus package is a classic case of a press gallery trying to frame a real-world issue into a narrow, political framework that suits its own reporting purposes. It is a collective illusion being foisted on the mainstream media’s ever-smaller audiences by journalists and commentators unable or unwilling to see outside the gallery prism of winners and losers and political personalities.

And it is a “debate” run entirely by the press gallery and the Federal Opposition. There are no — no — economists or business groups who think it is time for the stimulus to be wound back, except for those on the far right or Liberal shills such as Henry Ergas, who opposed the stimulus package in the first place.

Spot on.

Here’s Peter Anderson, head of the Australian Chamber of Commerce and Industry (easily the most anti-ALP business group going):

"Much of the growth has occurred in areas where the government's stimulus package has had a direct impact," Australian Chamber of Commerce and Industry chief Peter Anderson told reporters in Canberra.
"What that tells us is that there is still some underlying fragility in the Australian economy."
He said the economy would be tested to sustain levels of growth in coming quarters. "Whilst helpful to confidence, it cannot be a basis for any euphoria or any view in the Australian economy that we are out of the economic woods, we are not yet out of the economic woods."

That sounds very much like a man still damn worried about the fragility of the economy.

According to Joe Hockey and Malcolm Turnbull though such concerns are foolish. It’s all over, that war has been fought and now it’s time to criticise Rudd and Swan for how they fought it – you know that they used too much ammunition (which has me thinking that Hockey and Turnbull probably think soldiers on the front line worry more about if they’re shooting too many bullets rather than if they’re going to run out of ammunition).

Just as dopey has been the Canberra Press Gallery (as Keane notes). At yesterday’s press conference some fool actually asked Swan if he could guarantee that the Government wouldn’t borrow 1 cent of money it didn’t need.

Just amazing. Does that clown actually think there is a shop that Swan goes to and asks to buy a recovery from the Global recession?

Again using a war metaphor, it’s like asking a General to guarantee that he won’t fire one round of ammunition more than necessary to win the battle. Here’s a tip – the job of the General is to win the battle, and it’s the job of the treasury to keep us out of recession. Suggesting Rudd and Swan could have spent less means saying – well we got 0.6% growth, if we had spent a billion less would that mean we would have got 0.5% growth? Do they seriously think the economy is that easy to manoeuvre?

Running an economy is not (despite what Peter Costello would have you believe) like driving a sports car that requires just putting your foot on the perfectly calibrated accelerator or brake. An economy is not a Ferrari; it is sluggish, it doesn’t steer well, it is prone to sliding off the road; the accelerator and brake are sometimes touchy, other times resistant to pressure; the gears require double declutch; and while you’re doing all that, the windscreen has fogged up and the demister is on the fritz; and to top it off the steering wheel at times seems to have a wheel lock on and no one can find the keys.

In short an economy is a  bugger of a thing to drive.

Asking questions about whether a billion or so less could have been spent is like a car journalist judging a Camry’s handling, acceleration and top speed compared to that of a Porsche.

It’s time to acknowledge that the economy handles like a pig but Swan and Rudd (and Treasury) seem to have (for now) worked out how to at least keep the thing on the road. 

Swan’s got a little growth he’d like to show you all

Well that was a shock! So much for economists thinking the GDP growth might be nil to slight. A 0.6% rise in a quarter is positively booming (well relatively so).

Here’s a graph of the GDP growth of the world economy by quarter since the start of 2007:

What it shows (and I admit it’s a bit confused), is that around the middle of 2008 pretty much everyone started heading south. Some parts of the world really went off the cliff – Japan, Korea and Sweden more than most.

Australia went down by a bit, but by the 1st quarter of 2009 we were kicking arse and taking names macroeconomicaly speaking.

In the second quarter, the rest of the world started slowly to catch up; but while South Korea has got some serious economic steroids, and Japan is also getting going, by and large most of the world is still going backwards (only less so than they were 3 months ago).

So when the GDP figures came out today, it was pretty obvious that Wayne Swan was going to be pretty happy, and was also going to take most of the credit. And indeed he did.

He also went straight onto the front foot by pointedly repeating (and repeating) that any calls to wind back the stimulus would be akin to “pulling the rug out from under the economy”. He does have a point – the economy is growing, but it is a tad early to say things are booming along nicely and that we can all put our feet up and wonder what all the fuss was about.

Yesterday the Wall Street Journal wrote that there were worries in the US about the performance of a large number of banks. As AM reports: 

the federal deposit insurance corporation, the FDIC, which guarantees deposits, has 416 banks on its problem list - an increase of 109 troubled banks from three months earlier. The Journal also wrote in its editorial that the FDIC has a mere $10.5 billion in reserves to guarantee $4.5 trillion in bank deposits. The paper says American taxpayers better get ready for another bailout - this time for deposit insurance.

To give an indication of how fragile things are in the US, last Friday 3 banks failed, bringing the total to 84 so far this year, as the banking industry grapples with deteriorating loans. That compares to a total of 25 bank failures last year and only three in all of 2007.

So on one day last week as many banks failed as in all of 2007, and the FIDC is still worried about 416 others! (No wonder the Dow Jones Index went down the last couple of days).

So the smart move seems to be hold the course, keep the stimulus going just in case the US and other fall again – especially as the remaining stimulus is pretty much all the relatively non-inflationary infrastructure and building (no one is suggesting we need another cash handout).

Joe Hockey was given the unenviable task of talking up the Opposition’s line of opposing the stimulus (which we can now see has worked) and trying to explain that the stimulus which kept Australia out of recession was poorly targeted. It was obviously too big a task for Malcolm Turnbull, because he wasn’t sighted today. Poor Joe did a quick doorstop interview where he said:

… if you throw enough money at a problem some of it will stick. The economy's resilience is due to the good state the Coalition left it in before the global crisis hit. Today is a warning bell for Mr Rudd - stop spending so much money otherwise we are going to end up with higher interest rates and higher taxes.

He kept to the line, but it didn’t sound too convincing. This year Hockey and Turnbull and other in the Liberal Party have used the phrase “Rudd recession” 25 times in Parliament. They were positive that the economy would go negative. That debate is now over, and it all sounds a bit foolish.

The Liberal Party are now reduced to arguing that the debt accumulated due to the stimulus wasn’t worth keeping Australia out of recession. It’s a tough argument to sell. It is highly unlikely interest rates will go up to the levels they were at the time of the last election, and so the “cost” of the stimulus is going to pretty ephemeral to most people. It’s one thing to talk about debt, it’s another for people to actually feel the impact.

And when it comes to economic selling points, as with medical conditions, people generally only get worried when they can feel something.

Negative growth? Unemployment? High interest rates They’re easy to feel.

GDP growth? Well it looks likely that it’s going to be a lump felt by the opposition from now till election day, and you can bet neither Swan nor Rudd will take pity and cut it out for them.

The Pinball Wizard and Crazy Politics

On her Twitter page today, young Green’s Senator, Sarah Hanson-Young noted that today was 12 months since her Maiden speech, and she remarked “wow what a crazy year it has been!” Unfortunately for Senator Hanson-Young, on a day when Victorian Tourism Minister Tim Holding was found after getting lost bush walking on Mount Feathertop and NSW Health Minister John Della Bosca came out and admitted he had been cheating on his wife, federal MP Belinda Neal, and had been having an affair with a woman half his age, the bar has been well and truly raised for using the “crazy” adjective. When he was found, Holding was described as being “cold, wet, scratched, bruised and disoriented but overall was "fine”. But for the last, the same most likely could be said of Della Basco today.

Equally crazy is Federal politics, where the economic news today revolved around the Balance of Payments figures coming out today. They showed that export income had fallen pretty drastically – mostly due to falls in commodity prices. The other economic news was the Reserve Bank deciding to keep rates on hold. For now.

This is what the RBA said:

Economic conditions in Australia have been stronger than expected, with consumer spending, exports and business investment notable for their resilience. Measures of confidence have recovered. Some spending has probably been brought forward by the various policy initiatives; in those areas demand may soften in the near term. Some types of capital spending are also likely to be held back for a while by financing constraints. But overall, it now appears that investment may not be as weak over the year ahead as earlier expected. Higher dwelling activity and public demand will also start to provide more support to spending soon and, hence, growth is likely to firm going into 2010.

Which is Governor of the RBA speak for some things are good, some things are not so good, and we can’t really say whether or not things are going to keep getting better or get worse, but we think they’ll get better. Perhaps.

The interesting thing will be tomorrow’s National Account figures which will show GDP growth in the June quarter. A week ago economists (yeah those guy who are never wrong) were thinking there would be GDP growth of around 0.5%. After today’s Balance of Payment’s figures they’re quickly revising that down to anywhere between –0.1% to 0.3% or somewhere around there (let’s not kid ourselves that it’s anything more than an educated guess).

Now you would think the Government would be disappointed should growth come in lower and that the opposition would be crowing if the GDP is low because that would mean the stimulus has failed. The only problem is that in the last week Malcolm Turnbull and Joe Hockey have been going on that the stimulus should be wound back because the economy is going better than expected. Here’s Turnbull today:

The Opposition Leader told The Australian yesterday the signs of economic recovery made it clear the Prime Minister's $43billion economic stimulus package was too big.
But Mr Rudd was unable to wind back spending, Mr Turnbull said, because he had made the mistake of promising a new hall or library to every primary school in the country, and he would pay a massive political price if he reneged on the pledge.
Yesterday Mr Turnbull said the signs of economic recovery had vindicated his stance, and that Mr Rudd had tied himself to public expectations and would be unable to cancel the spending on schools no matter how compelling the economic evidence.
"My view is that the government should be easing back,"

It is a rather bold statement to make given that it was only the start of June that Turnbull was criticising Rudd for acting as though the economic crisis was over. So now we are in the crazy situation where the opposition is berating the Government because the economy is doing too well and thus the stimulus should be wound back, but also that the stimulus has not had anything to do with the economy doing too well. Similarly we have a Government who wouldn’t mind a few slightly gloomy economic figures if only to show Turnbull as a total economic dill and to also help with their argument that the stimulus needs to continue.

Thus we had Joe Hockey on the weekend saying:

'The Government's spending too much money and it's going to put upward pressure on interest rates and its going to cause Australians to pay higher taxes than they should be paying to pay off this debt. Sooner or later the Rudd Government has to pull back on playing Santa Claus and start playing the Grinch.”

Which is a nice line, but not all that intelligent. Gee Joe, you think interest rates might increase from the lowest level since 1960? What a genius. Here’s the thing Joe, if interest rates went down from here that would mean only one thing – the economy is officially in the toilet. Actually it’s gone down the S-bend and is on the way to the sewer. When interest rates are at  a stimulatory level you want them to go up because that means the economy doesn’t need to be stimulated to such an extent. And here’s the other thing – the overwhelmingly large percentage of the stimulus planned in the next two years is on infrastructure and building, which has a lot less impact on inflation than the cash payouts or tax cuts.

Wayne Swan came out today and had a whack at Joe, saying:

Joe Hockey must be "deaf, dumb and blind" if he thinks the government's economic stimulus is not working, Treasurer Wayne Swan says.
He was again defending the government's decision to continue with its planned investment spending, even though there are signs that the economy is over the worst of the impact of the global recession.
He said the stimulus package has had a dramatic impact on confidence and supported investment when private demand "went through the floor as a result of the global recession".
"There are tradies all over the country who are working on stimulus projects. It's adding to confidence in a way that we don't see anywhere else in the world," Mr Swan told the Fairfax radio network on Tuesday.
"I think Mr Hockey ought to at least acknowledge that the stimulus package has done good things for this country, and it's meant that we're one of only two advanced economies that grew in the March quarter.
"He just ought to be man enough to acknowledge it."

Ah, bless those tradies – the “working families” of 2009.

Later in the day, Opposition spokesman for the Disabled, Senator Mitch Fifeld said that Swan should apologise for the insensitive comments about people with disabilities. Sigh. Yes apparently you can no longer say that someone who refuses to see or hear evidence is blind or deaf. At this rate, the metaphor is close to being as dead as the bump in AFL.

Ok, maybe he shouldn’t have said “dumb” (it’s just not accurate – no one has ever suggested Hockey has any problems talking), but I suspect Swan (who apologised if anyone took offence – which I seriously doubt) must be a bit of a fan of The Who and was thinking of the line from their Rock Opera Tommy, and the deaf, dumb and blind kid who “sure plays a mean pinball” (and who also plays by sense of smell…)

When the national accounts come out tomorrow, we’ll see a continuation of these bizarre political days where the opposition will be hoping for a strong increase in GDP growth, and the Government will be kinda hoping for a small increase (if any). The Government of course won’t mind too much a strong GDP growth – it will take all the credit, and it is a pretty easy story to sell – it just means that they’ll have to reconsider the stimulus and counter the opposition’s attack that the stimulus isn’t needed. A weak GDP growth figure on the other hand shows Turnbull and Hockey to have been far too bold in their predictions of the growth of the economy and also gives them greater strength to their argument for continuing the stimulus, thus it is an easier sell for them.

Crazy times indeed.