Unraveling Frydenberg’s Mind

Since Treasurer Josh Frydenberg sits side-by-side with PM Morrison at the pinnacle of the Morrison government, it is appropriate that we query the state of his mind, just as we sought to understand Morrison’s in Unraveling Morrison’s Mind.

There is no evidence that he is attracted to the conspiracy theories that fascinate Morrison, nor is he known for taking an evangelical approach to his politics. He is of the Jewish Faith, and on the face of it, seems to follow it in an orthodox way.

What then goes on in his mind as he pursues his role as Treasurer?

First, he finds it un-embarrassing to repeat over and again a set of blatant lies.

Let’s start with ‘wages growth is picking up’. The objective evidence shows that this is not so. So strident is this line that his Finance Minister, Mathias Cormann, repeats the lie at every opportunity: “Our economic agenda has been successful in delivering stronger growth, in delivering stronger employment growth, in helping to drive the unemployment rate down and wages growth is picking up.” He even had the effrontery to repeat the claim only a few days ago. “Something we don’t read much about, in fact we are often told the opposite somehow – wages growth is picking up.”

So whom do we believe? What about the Reserve Bank? An unambiguous assertion in its November Statement of Monetary Policy reads: “… wage growth is no longer expected to pick up.” The bank has downgraded its forecasts to 2.2% for the rest of this calendar year, before growth “picks up” again next year… to 2.3%, where it will stay well into the 2020s.”  0.1% is not much of a ‘pick up’ over the decade ahead, and is well short of the ‘pick up’ in inflation!

The bald assessment of the RBA has had no effect on Frydenberg or Cormann. Although Abraham Lincoln reminded us long ago ”You can fool all the people some of the time, and some of the people all the time, but you cannot fool all the people all the time”, they persist with this blatant lie over and again.

The lie is all the more cruel as it gives false hope to the countless wage earners who have been looking for a wage rise for so long. The reality of wage stagnation has been with them month after month, year after year, and threatens to extend into the next decade.

If you wish to see what wages growth there has been for each state and territory for the last ten years, look here: The graphs tell the sorry story. Not so impressive is it?

What sort of person continues to lie so blatantly? Unraveling this feature of Frydenberg’s mind seems more challenging than unraveling Morrison’s mind. At least with Morrison there was some evidence of his penchant for conspiracy theories and evangelical talk. But how can one explain Frydenberg's penchant for unashamedly and repeatedly lying? And he knows he’s lying – the evidence of his lies is before his eyes every day.

One can only assume that for Frydenberg lying is part and parcel of his modus operandi, an innate element of his character that troubles him not! Perhaps he takes the view that so long as it serves his purpose, lying is a standard political procedure.

Wages growth is not the only focus of his lies. He still claims to be headed for a surplus by ‘paying down Labor’s debt’. As Kaye Lee says in the November 10 issue of an article tited: MYEFO will be interesting in AIMN:

…“the underlying cash balance for the financial year to 30 September 2019 was a deficit of $13,853 million i.e. in the first quarter of this financial year, we have spent almost $14 billion more than we have received.

And there are implications for the upcoming MYEFO as budget predictions are falling short. The net operating balance for the year to 30 September 2019 was a deficit of $15,209 million, which is $2,681 million higher than the 2019-20 Budget profile deficit of $12,528 million. The difference results from lower than expected revenue and higher expenses.

The fiscal balance for the year to 30 September 2019 was a deficit of $14,650 million, which is $928 million higher than the 2019-20 Budget profile deficit of $13,721 million. The difference results from lower than expected revenue, higher expenses and lower net capital investment. There have also been downgrades for expected wages and GDP growth.
So there’s another set of Frydenberg lies.

Here’s yet another from Michael Pascoe in The New Daily: Frydenberg’s tax cut for foreign investors is a triumph of spin over substance:
Whenever he gets the opportunity, Treasurer Frydenberg likes to trot out his “record $100 billion infrastructure investment” line from his April budget. To put it kindly, that’s just political spin.

The $100 billion is over 10 years – $10 billion a year. Back in 2014, then-Treasurer Joe Hockey was promising $50 billion over six years – $8.33 billion a year. Midway through Mr Frydenberg’s promised decade, Joe’s $8.33 billion in 2014 dollars will be worth more than Josh’s $10 billion in 2024 dollars. It’s a con to sell it as an increase. And the colour of the “new” Federal money is yet to be seen, other than some $35 million spent on advertising it.

And the final kicker for Mr Frydenberg’s stunt is its emphasis on mega-projects, things costing more than half a billion dollars. Politicians do love the big announcement, as Utopia viewers and Infrastructure Australia know.
Now Frydenberg is into giving loans to overseas investors. As Michael Pascoe puts it:
It is no surprise, then, that the government, wanting to be seen to be “doing something” about a stagnant economy, has reached for a tax stunt – a 50 per cent tax cut for foreigners wanting to invest in big infrastructure projects here. It doesn’t matter that various economists have immediately called out the nonsense. It doesn’t matter that this is an unnecessary waste of revenue, will have little (if any) net positive impact on getting new projects underway, that the impact (if there is any) will be many years away when the economy needs help now.

It only matters that it’s something for the Treasurer to announce when the government is under pressure over falling wages growth and rising unemployment…It matters only that the stunt was swallowed by a compliant media! The simple reality is that the world is awash with capital desperate for anything worthwhile to invest in…it is a shortage of projects being brought forward by governments, a shortage of political vision. The big investors, including those leading our $2.7 trillion superannuation money mountain, are scouring the world for infrastructure projects…While Treasurer Frydenberg feeds his media chooks the necessity of cutting foreign investors’ withholding tax from 30 per cent to 15 per cent, there is more than $20 trillion sitting in government and corporate bonds offering negative interest rates. That is an amount of money that is impossible to comprehend. It’s a quarter of all the world’s government bonds.

Anyone brighter than Josh Frydenberg should be able to see there’s no need to halve tax to attract investment in such a climate. Indeed, the Australian government can presently borrow money for 10 years for about one per cent. The opportunity exists for the government to issue “infrastructure bonds” and get knocked over in the rush by investors foreign and local.
Now he's telling older Australians they may have to work longer. Warning that there was 'an economic and fiscal timebomb facing the country' that would place new demands on our health, aged care and pension systems, he argued that people in their mid- and late-60s will have to work longer and undertake training to keep in touch with the jobs market as pressure builds on the budget bottom line. But economist Euan Black, writing in The New Daily, argues that Frydenberg is 'missing the point' simply because there aren't enough jobs to go around!

Need I go on? Frydenberg’s mind, uncluttered by conspiracy theories, is cluttered with economic gobbledygook, which is even more dangerous that conspiracy theories when he bedazzles the man-in-the-street into believing that he knows what he’s talking about. He lies unashamedly until he believes his own lies.

Which is more dangerous – Morrison’s attraction to conspiracy theories and evangelical talk, or Frydenberg’s addiction to lying and misrepresentation, together with the economic incompetence he exhibits day after day?

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