Conventional Wisdom

Conventional Wisdom

This article from the August 2012 edition of the IPA Review is by Researcher with the IPA, James Bolt.

With the federal government finally forecasting Australia’s first surplus since the global financial crisis (GFC) hit, it is interesting to look back at how we came out of the catastrophe relatively strongly. While Wayne Swan’s surplus may rely on some dubious accounting, the fact remains that Australia is not nearly as broke as almost every other country on the globe. Enter The Australian Moment, journalist George Megalogenis’ economic history of Australia from the early 1970s until Rudd’s stimulus package, which seeks to answer the question of how we came out of the financial crisis as the ‘last rich nation standing’.

According to Megalogenis, the reason we came out of the GFC as the last nation standing is because of a number of inspired decisions made in our economic past. The three he predominantly focuses on are firstly, our willingness to trade with the rapidly rising Asian region earlier and with more effort than most (if not all) Western nations; secondly, getting the government as much out of the finance sector as possible without complete deregulation; and finally and most controversially, the success of former prime minister Kevin Rudd’s stimulus package. Megalogenis argues that much of our success was not thanks to China’s demand for our natural resources, but by the collaboration between Rudd and the Reserve Bank.

It only takes a couple of pages to realise how much work Megalogenis has put in to this book. Megalogenis does not only say who won which
election, but also provides the net gains and losses of seats by state, and the economic conditions that accompanied them. He does not simply list inflation numbers in Australia, but compares them with other nations and explains the trends that underline why economies grew or shrunk. No stone is left unturned. Annabel Crabb calls him ‘Australia’s best explainer’, and this book stands testament to that.

Although what is there is substantial, the central weakness of the book is that it tries to cover too much in too few pages. It is an ambitious feat to provide a complete economic and political history of Australia since 1970 in one book. Though economics and elections are well covered, other major events in Australia’s history are skimmed over without getting to the heart of the matter-especially when it comes to the Howard government. John Howard’s time as prime minister is summarised in 50 pages, focusing mainly on WorkChoices, the Tampa incident and other aspects of the government that Megalogenis is critical of. The reader undoubtedly finishes the chapter with the impression that Megalogenis thinks Howard only did three things right, and only in election years, which, if logic is followed, does raise questions as to how Howard managed to last almost 11 years in office.

Howard can only dream of the treatment that Labor gets. Gough Whitlam, in Megalogenis’ view, was not so much incompetent as pushed to the brink by circumstances beyond his control, like stagflation. Apparently that’s why his ministers accepted Khemlani’s loans, and of course Whitlam should never have been sacked. The recession we had to have snuck up on the Hawke/Keating ‘dream team’ out of nowhere-the reader is completely blindsided by it-and even then, the recession is painted as insubstantial. In other words, Megalogenis conforms to the popular view of most press gallery journalists in modern Australian politics.

The key selling point of this book is the fact that it had input from many of Australia’s living former prime ministers. But their actual contribution to the book is really not as substantial as it should be. Instead hearing their opinions on different policies or events spread out through the book, they are relegated to the end of chapters, so enjoyable rants from Paul Keating are unfortunately few and far between. It often feels as if there are pages and pages of Megalogenis and then a few paragraphs of the major figures involved, which could have been better balanced.

If you really want to know what the collective view of the federal parliamentary press gallery is of the last 40 years of Australian history, you’ll enjoy this book. But a book written by a writer of Megalogenis’ stature, with enviable access to former prime ministers, should be much more than that.

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