Why does Malcolm Turnbull make so many mistakes?

A man with a background like Malcolm Turnbull shouldn’t make so many mistakes.  An ex-merchant banker, Goldman Sachs manager, businessman, barrister, politician and Opposition Leader should be more perspicacious.  He doesn’t seem to understand what he’s doing.

Earlier this year he made the mistake of accusing Kevin Rudd and Wayne Swan of ‘talking up inflation’ and ‘egging’ the Reserve Bank to raise interest rates, both commonsense-defying accusations.  Now inflation is down to an annualized 3 per cent, at the top of the comfort zone of 2 to 3 percent favoured by the Reserve Bank.  So raising interest rates has had an anti-inflationary effect, even if it was not the only factor.  Rudd and Swan were right in pointing to the erosive effects of steadily rising inflation and the need to get it under control.  Now that that has been achieved, the Reserve Bank has today been able to further cut interest rates, to 4.25 percent, much below the rates during the Coalition reign of ‘interest rates will always be lower under the Coalition’. How could Turnbull not understand such fundamental financial truths?

Then he made the mistake of questioning the Government’s $10.4 billion economic stimulus package after having given it bipartisan ‘un-quibbling’ support.  Shouldn’t he have understood that such equivocation leads to erosion of confidence in his decision-making?  To justify his about-face he said he would have formulated the package ‘more astutely’.  No details were provided.  Another mistake – he expected his assertion to be accepted without question.

Then there were the mistakes he made in criticizing the Government’s bank guarantee.  It should have been capped at $100,000, it should have had a shorter duration, it would cause havoc, it has made the situation worse, Australia is the only country whose actions have aggravated the financial crisis, Rudd and Swan have no idea what they’re doing, they’re incompetent in financial management, they’re out of their depth, and so on it went – nothing they did was right.  Yet no independent commentator has shown how any of these criticisms are valid.  Some in the media have given Turnbull support, but with no justification.  How could an ex-banker make so many mistakes?  How could he be so lacking in understanding?  The guarantee seems to have worked.  Who’s complaining now?

Next he made the mistake of insisting that the Government must not go into deficit – that would be a failure in economic management.  He can’t find an economist, or for that matter a columnist, to back his aversion to a deficit, or more correctly his aversion to Rudd going into deficit.  Then he repeatedly makes the mistake of declining to say whether he would go into deficit if he was PM.  So who does he expect to give his rhetoric credence, apart from his rusted-on supporters?  [more]

This week he made the mistake of giving his National Party colleagues his blessing to cross the floor and vote against tax incentives for planting forests as traps for carbon emissions.  A piece by Samantha Maiden in The Australian, Malcolm Turnbull surrenders in Coalition row over forests plan accuses him of ‘running up the white flag over a backbench revolt on climate change’.  Another mistake, this time of leadership, that undermines his authority.  Four senators did cross the floor and Fiona Nash resigned from the shadow front bench.

Today Turnbull is facing another revolt in his ranks on IR with at least two Liberals refusing to accept Labor's mandate to abolish WorkChoices.  Last week he accepted Labor's mandate and declared WorkChoices dead as Liberal policy.  But some conservative hardliners within his party don't agree with him and are threatening to ‘vote with their conscience’.  Read all about it in Samantha Maiden’s article Liberal MPs may spurn Malcolm Turnbull over IR in today’s Australian.  Here’s another example of weak leadership, further undermining of Turnbull’s authority, and flagging party discipline.

Next he’s threatening that the Coalition will block the $28 billion school funding bill in the Senate and thereby delay next year’s funding to non-Government schools.  How could a Coalition leader make such an electorate-angering mistake, a mistake that will disadvantage many Coalition voters?  What does he expect to gain?  Such political mistakes are foolish and costly.

Perhaps most seriously for him, Turnbull has made the mistake of allowing Julie Bishop to exercise her prerogative to select the Shadow Treasurer position.  She is not performing well, the media has begun an attack, some of her colleagues are privately expressing doubts about her ability and white-anting her via the media, and Bishop and some of her colleagues have been forced into defensive mode.  His mistake was to appoint her when he knew she didn’t have the qualifications or the qualities for what is a difficult job.  He overlooked a better choice in Andrew Robb, the only Coalition member who has shown some understanding of the financial crisis.  It was either a mistake of political judgement, or a sign of leadership weakness in not insisting that he pick the best team.

What a catalogue of mistakes, what a lamentable lack of understanding of economics, financial matters, politics and leadership.  How can he go on?  Laurie Oakes thinks he has the answer: even when he‘s wrong, Turnbull is never in doubt about the correctness of his position.

History may show that Turnbull’s biggest mistakes are underestimating Kevin Rudd and Wayne Swan, perpetually insisting they ‘simply don’t understand’ financial or economic matters, consistently condemning their every move, changing his tune whenever it suits him, flying in the face of competent economic intelligence, failing to exercise strong leadership, continuing to make political points at a time of unparalleled financial turmoil and steadily losing credibility as he does, indulging in obfuscation and circumlocution while avoiding answering questions asked by interviewers, and most significantly failing to notice that the people are not behind him. 

Polls show that the only parameter on which Turnbull has made any headway since becoming Opposition Leader is a better satisfaction score than Brendan Nelson, not a difficult ask.  This week’s Essential Research Report shows that respondents felt Julia Gillard would make a better PM than Malcolm Turnbull 39/34.  The people are watching, thinking and making up their minds.

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2/12/2008If any reader has doubts about my statement that Turnbull indulges [quote]“...in obfuscation and circumlocution while avoiding answering questions asked by interviewers...”[/quote] read the transcript of the interview of Turnbull by Chris Uhlmann on the ABC’s AM yesterday: http://www.abc.net.au/am/content/2008/s2433787.htm

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4/12/2008"Earlier this year he made the mistake of accusing Kevin Rudd and Wayne Swan of ‘talking up inflation’ and ‘egging’ the Reserve Bank to raise interest rates, both commonsense-defying accusations." AA George Megalogenis has a very interesting blog post regarding interest rates. Truffles, to my memory, has been consistent with his claim that interest rates were too high, I dont believe his claims about the ALP "egging" on the RBA as it is supposed to independant. Looks like he might have got one thing right. "GDP slowed by two-thirds, from a growth rate of 1.5 per cent over the December and March quarters to a miserable 0.5 per cent in the June and September quarters. Household consumption collapsed from 1.8 per cent to zero over the same period. Now the rub. Federal spending as measured by the national accounts halved from 2 per cent to 1 per cent. Only state and local governments kept up their end of the bargain with their spending rising from 1.8 per cent to 2.1 per cent. A year ago, household consumption was worth 55.9 per cent of GDP. Now it’s 53.7 per cent - a record low. A year ago, federal, state and local spending was worth another 17.8 per cent of GDP. Now it is 17.3 per cent - a figure last seen in 1979. How did federal Labor manage to run against the cycle? The simple answer is they didn’t know what they were doing. The more subtle explanation is that neither did the Reserve Bank. Glenn Stevens was still raising interest rates in February and March - the very quarter that the data tells us the economy had peaked. It is easier for the Reserve Bank governor to admit error. He can cut interest rates as fast as he can raise them. " http://blogs.theaustralian.news.com.au/meganomics/index.php/theaustralian/comments/number_crunchers_missed_turn/ While Swan can rightly reply that it was an inheritance from the previous Gov and that the RBA had little choice, Truffles can claim that he was right all along, the rainmaler scam paying dividends?

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5/12/2008Bearnard Keane's take on [quote]Turnbull's shocker of a week[/quote] on [quote]Crikey[/quote] is worth a read. http://www.crikey.com.au/Politics/20081205-Turnbulls-shocker-of-a-week.html
How many oranges do I have if I have 3 oranges and take ONE away?