New research by the Australia Institute reveals that across a broad range of economic measures, the Abbott/Turnbull government has performed the worst of any Australian government since Menzies took power in 1949. The institute’s paper also notes that historically there is little correlation between “business friendly” policies and economic performance.
Inevitably election campaigns become focused on economic management. On this score historically, the Liberal Party is usually assumed to be the better economic manager. For example, a poll earlier this month by the Essential Report had voters preferring the LNP over the ALP on the issue of who they trusted on “management of the economy” by 39% to 27%.
Such a belief is behind the Liberal party’s main desire to fight the election campaign on their economic plan, the central feature of which is the company tax cut.
With this has come much commentary that the ALP is waging a war on business, and that being anti-business (or at least anti the company tax cut) means being against strong economic performance.
But a report by the Australia Institute to be released today titled “Jobs and Growth … And a Few Hard Numbers” shows that there is little correlation between economic performance and either political party. The report, which examines the economic performance of Australia under every prime minister since Menzies, also found that the “business friendliness” of a government does not appear to have much impact either.
The report examines economic performance across a range of 12 indicators – including GDP per capita, the unemployment rate, employment growth and the growth of real business investment and intellectual property investment.
The findings by economist Jim Stanford showed that on all but two measures, the performance under the Abbott/Turnbull government has been worse than that under the Gillard government.
Only on the measure of growth of government debt as a share of GDP is the Abbott/Turnbull government “better”. But even if you agree with the proposition that lower government debt is a good thing, the Abbott/Turnbull growth of 2.16% of GDP is only marginally better than the 2.26% of GDP growth observed under the Gillard government.