The Parliamentary Library released a research paper which divides numerous economic trends up by Governments from Whitlam to Howard. It turns out party hats don’t work so well in analysing these trends.
This is an interesting graph with a nice trend. Economic policy makers over the last forty years can take a bow. When averaged across administrations it shows that governments have had a consistent policy of stabilising inflation until we have the mechanism today where an apolitical body, the Reserve Bank, makes interest rate decisions. There are external influences as well such as the China joining the global manufacturing business and placing deflationary pressures on economies with open trade policies. But by and large it can be argued that reducing inflation has been a successful government economic policy – to the point that Howard is presiding over very stable and low inflation figures.
I do not know why it dipped during Fraser’s term but to put it into perspective that graph makes the dip look large because of its scale; it is the difference of 2% between Howard’s high mark and Fraser’s low one. Which suggests labor participation is pretty consistent.
This is the most significant graph of all of them as it shows a definite bump between Whitlam/Fraser and Hawke/Keating/Howard. The last three governments are doubling the growth rate of Fraser and quadruppling the growth rate of Whitlam. Two issues here; economic liberalisation is superior in producing growth outcomes and secondly globalisation has been good to Australia. By the same token globalisation is meaningless unless Australia adopts economic liberalisation. Since Hawke this has been a consistent government policy.
There is a dip in the Hawke/Keating years, but like the labor participation graph the dip is bigger than it appears with a 0.8% difference to the Howard government. Otherwise that graph would be a neat uniform upward trend.
Unfortunately there is a definite upward trend here from government to government. Successive governments are taxing more and funding more. If you compare the size of government under Whitlam it is pretty hardcore in comparison to a modern government. Even adjusted for inflation tax receipts have doubled in the last thirty years.
So what can we conclude from that smattering of graphs?
Mainly that Australia has had good governance and the economic policies have been consistent from one administration to another in seeking better economic outcomes. There was an obvious change to economic liberalisation or rationalism in the 1980s which has been continued to this day. In conjunction with globalisation this has advanced Australian growth and prosperity.
Where Australia has had bad governance it has usually been temporary and contained in small areas. It is an issue, but by and large, government policies are consistent across administrations enough that the party itself does not matter so much. The trends indicate that a party reading of this data does not work so well as the positive trends, such as inflation, and the negative trends, such as increasing tax receipts, are across parties and suggest consistent government policy rather than differential party policies.