Garry Barrett

Poll 64

Panelists were asked to comment on two questions: 

Is the budget likely to achieve its aim of getting inflation back within the RBA target band by the end of this year and back to 2.75% by mid next year?

And

On May 14, the government delivered a budget designed, in the Treasurer's words, to "focus on fighting inflation in the near term and then growth in the medium term " - What grade would you give the budget, given that objective? A, B, C, D, E or F

Wes Mountain/The Conversation, CC BY-ND https://creativecommons.org/licenses/by-nd/4.0/

YES On balance, I see the budget as aligned with the objective of getting inflation back within the RBA comfort zone. Obviously, this is not the only objective driving the design of the budget, so there is a wide "confidence interval" around my forecast.

B

The government is attempting to balance providing cost of living relief to households against managing inflation at a time of soft economic growth. Its pragmatism is evident

Poll 63

April Poll - panellists were asked about the GST deal with Western Australia.  The following two questions were posed: 

"Is the long-standing arrangement broadly the best method of distributing the nationally-collected GST revenue?" and "Should the 2018 changes be kept or scrapped?"

YES

Scrapped

Poll 62

Panellists were asked "Which of the options set out below best describes the kind of approach the Australian government should take to the US Inflation Reduction Act? (Pick 1)"

To support homegrown emerging green technologies

Provide more grants to innovative firms across the entire economy

Poll 61

Worried economists call for a carbon price, a tax on coal exports, and ‘green tariffs’ to get Australia on the path to net zero

Expand the safeguard mechanism to cover more facilities to mimic a broader carbon price | Increase the carbon price presently paid by big polluting facilities via the safeguard mechanism | Expedite investment in large battery storage

Poll 59

Our panellists were asked the following 2023 budget question: "On May 9, the government delivered a budget designed, in the Treasurer's words, to strike a balance between relief, repair and restraint'.  What grade would you give the budget, given that objective: A, B, C, D, E or F?"

Wes Mountain/The Conversation, CC BY-ND - https://creativecommons.org/licenses/by-nd/4.0/

Overall rating: B - Keeping inflationary pressures in check: B

B

OVERALL COMMENTS: There were important measures in the budget which provide relief to vulnerable members of the community. Highlights were changes to the Parenting Payment Single, childcare care subsidy, support for Medicare bulk billing and reduced costs medicines. However, the government could have gone further in lifting the payment rate for Jobseeker (or committing to a phased increase). The change to Petroleum Rent Resource Tax was useful, though again I thought the govt could have gone significantly further on this front, generating further revenues. INFLATION COMMENTS: The government clearly sought to provide relief to families for cost of living pressures without adding to inflation. The range of subsidies such the electricity bill relief, Commonwealth Rent Assistance and Medicare bulk billing incentives and PBS dispensing limits work to reduce the costs of necessities for families without directly increasing the CPI. This was a smart approach to avoid adding to an inflationary spiral.

Poll 58

When panellests were asked to find an extra A$20 billion per year to fund government priorities like building nuclear submarines and responding to climate change, Australia’s top economists overwhelmingly back land tax, increased resource taxes, an attack on negative gearing and extending the scope of the goods and services tax.

Photo credit by Joshua Hoehne on Unsplash

Efficiency picks: Increase resource taxes Wind back deductions for negatively geared properties Wind back superannuation tax concessions Equity picks: Wind back superannuation tax concessions Introduce inheritance taxes Increase resource taxes

Poll 57

Australia’s top economists have overwhelmingly endorsed intervention to restrain gas and electricity prices, with only three of the 47 leading economists surveyed believing the best thing the government can do is to leave things to the market.

Photo credit: Wes Mountain/The Conversation, CC BY-ND

.

Increase taxation of resource rents for gas producers and use proceeds to reduce electricity and gas

The rise in international gas prices is a windfall gain for extractors of a national resource. Resource rent tax is one mechanism for sharing the windfall gains with the public.

Poll 55

Australia’s top economists are divided about how to tackle ballooning inflation of 6.1% that’s forecast to climb to a three-decade high of 7.75% by the end of the year.

Wes Mountain/The Conversation, CC BY-ND

Reserve a portion of gas and other commodities for domestic use Boost childcare subsidies

4.5%

The response has to be based on a detailed understanding of the drivers of the increases in the CPI. Important elements of recent experiences relate to supply-side factors; as a consequence we'll have to accept temporary higher CPI increases

Poll 52

"What do you think the intake of permanent migrants should be in coming years"

Australia’s leading economists have overwhelmingly endorsed a return to the highest immigration intake on record, saying Australia should aim for at least 190,000 migrants per year as it opens its borders, up from the target of 160,000 per year set ahead of COVID.

Photo credit "Wes Mountain/The Conversation, CC BY-ND"

.

190,000 is about right

Poll 51

Our panellists were asked whether rate hikes would be necessitated in the United States, Britain and Australia.

Despite appearances – especially in the United States – the era of high inflation isn’t set for a comeback in the view of Australia’s leading economists, and most see no need for the Reserve Bank to lift interest rates next year.

Question 4

"Following the next Federal election, the incoming Federal Government should commission an independent Review of the Reserve Bank of Australia."

Photo credit "Wes Mountain/The Conversation, CC BY-ND"

Agree

Poll 51

Our panellists were asked whether rate hikes would be necessitated in the United States, Britain and Australia.

Despite appearances – especially in the United States – the era of high inflation isn’t set for a comeback in the view of Australia’s leading economists, and most see no need for the Reserve Bank to lift interest rates next year.

Question 3 

"The Reserve Bank has, over the past 5 years, effectively used the tools available to it to achieve its goals of "maintaining the stability of the currency, ensuring full employment and furthering the 'economic prosperity and welfare of the people of Australia'."

Photo credit "Wes Mountain/The Conversation, CC BY-ND"

Agree

7

Poll 51

Our panellists were asked whether rate hikes would be necessitated in the United States, Britain and Australia.

Despite appearances – especially in the United States – the era of high inflation isn’t set for a comeback in the view of Australia’s leading economists, and most see no need for the Reserve Bank to lift interest rates next year.

Question 2

"When do you expect the Reserve Bank of Australia to next lift its cash rate?"

Photo credit "Wes Mountain/The Conversation, CC BY-ND"

.

7

2023

Poll 51

Our panellists were asked whether rate hikes would be necessitated in the United States, Britain and Australia.

Despite appearances – especially in the United States – the era of high inflation isn’t set for a comeback in the view of Australia’s leading economists, and most see no need for the Reserve Bank to lift interest rates next year.

Question 1

"The current combination of Australian fiscal and monetary policy poses a serious risk of prolonged above-target inflation."

Photo credit "Wes Mountain/The Conversation, CC BY-ND"

Disagree

8

Poll 49

"What measures should Australian governments adopt to promote demand for vaccination once supply is no longer a constraint?"

Photo credit "Wes Mountain/The Conversation, CC BY-ND"

Mandatory vaccination for higher risk occupations;Vaccine passports for higher-risk settings (eg. flights, restaurants, major events);National advertising campaigns;Cash incentives for vaccination;Lotteries with cash or prizes for the vaccinated

There is a positive social benefit with each person vaccinated. To encourage as high a rate of vaccination as possible, the govt should consider the spectrum of policy options available. To start, a clear and compelling information and communication campaign is needed. Further options including cash incentives or possible prizes merit consideration. Vaccine passports make very good sense for local business and, as is currently the case, will be required for international travel (when Australia moves to open up). A number of occupations are very high risk of exposure and spread - mandating vaccination for those occupations is a sensible public health measure.

Poll 47

This month, our panellists were asked whether Australia should take action to speed the transition to electric cars.

"As part of efforts to reduce carbon emissions, Australian governments should take action to accelerate the take up, or take no action to accelerate the take up of electric cars"

Photo credit "Wes Mountain/The Conversation, CC BY-ND"

Subsidise the purchase of all all-electric cars, Subsidise public charging points for electric cars

9

Poll 46

"On May 11, the government delivered a budget designed, in the Treasurer's words, to 'secure Australia's economic recovery and build for the future'.  What grade would you give the budget given that objective, A, B, C, D, E, F?"

Photo credit Wes Mountain/The Conversation, CC BY-ND

.

C

Poll 44

"Ahead of a decision about any permanent increase expected early next year, The Conversation and the Economic Society of Australia asked 45 of Australia’s leading economists where they thought JobSeeker should settle."

Be indexed in line with wages

Poll 42 

"The October budget will see the government announce additional policies to support recovery.  Please nominate the four programs you think would be the most effective (for an intervention of a given size) over the next two years"

Photo Credit: Wes Mountain/The Conversation, CC BY-ND 

Permanently boosting JobSeeker (Newstart) beyond December 31, 2020, Social housing, Incentives for cleaner fossil fuel energy, Funding higher quality aged care

Poll 41

"The legislated increases in compulsory super contributions, which are set to climb from 9.5% of wages to 12% over the next five years should...."

Photo Credit: Wes Mountain/The Conversation, CC BY-ND 

Be deferred

8

In light of the deep recession we are currently in, I would defer increasing forced savings measures such as the Superannuation Guarantee. Individuals and families can undo some of the forced savings (through dissaving on other margins) though the liquidity-constrained are least able to do so. Current cyclical conditions are so serious I would defer addressing the structural, life-cycle saving measures associated with increase the Superannuation Guarantee.

Poll 40

"Governments should provide ongoing fiscal support to boost aggregate demand during the economic crisis and recovery, even if it means a substantial increase in public debt"

Photo Credit: Wes Mountain/The Conversation, CC BY-ND 

Agree

10

Poll 38

"The benefits to Australian society of maintaining social distancing measures sufficient to keep R<1 for COVID-19 are likely to exceed the costs"

Strongly agree

9

There are immediate economic costs of strict social distancing measures enacted to limit the spread of COVID-19. Studies of the Spanish Influenza pandemic indicate that cities in the US that moved quickly to strict social distancing (or economic lock-down) measures experienced better health and economic outcomes. There are also important distributional issues to consider - there are policy levers to share the costs of the economic disruption across society and ameliorate the most severe impacts. The health and mortality impacts of allowing R>1 will severely impact the most vulnerable sections of our community.

Poll 37

Proposition 1: "Without changes to existing public policy or private sector practice in Australia, motherhood will always negatively affect a woman's career."

Proposition 2: "In Australia, fathers are more restricted than mothers in fulfilling a caring role while in employment."

Part 1 - Strongly agree

9

Part 2 - Disagree

8

Poll 34

"In general, using more congestion charges in crowded transportation networks — such as higher tolls during peak travel times in cities, and peak fees for airplane takeoff and landing slots — and using the proceeds to lower other taxes would make citizens on average better off."

Agree

5

Poll 29

"A sustained increase in the number of new homes constructed each year, all else equal, will make housing cheaper than otherwise."

Disagree

8

The proposition alludes to a shift in the supply curve for new housing stock. However, the motivating material is about the growth in house prices in Australia. To understand the Australian experience of rising housing prices, research shows that the relative growth in demand factors is critical.

Poll 30

"Pricing of road-use for electric vehicles should be the same as fossil fuel-powered vehicles."

Disagree

7

Poll 35

"There is no way to significantly increase the degree to which Australian retail banks act in the interests of consumers."

Strongly disagree

9

Poll 32

"There are clear net benefits for Australians from (further) increasing the diversion of waste from Australian landfills."

Strongly agree

9

Poll 33

Proposition 1: "There is a significant risk that, either as a result of the findings and recommendations of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry or as a result of the financial institutions' response to those findings, credit will become less readily available to Australian households or businesses."

Proposition 2: "Assuming credit becomes less readily available to Australian households or businesses, this will in turn have adverse consequences for the performance of the Australian economy."

1 - Agree

2 - Disagree

Poll 26

"The wages and conditions of Australian workers providing services in sectors affected by the rapid growth of digital on-demand subcontracting platforms will, on average, be expected to fall without further government intervention."

Agree

7

Poll 25

Proposition 1: "The modern phenomena of information overload and social-media-fuelled 'fake news' bring into focus the value of quality journalism. Quality journalism has a public-good dimension that warrants public support."

Proposition 2: "The Australian government presently provides funding for the ABC and SBS, Australia's independent public broadcasters. The Australian government should increase its financial support of quality journalism."

1 - Strongly agree

2 - Agree

Poll 24

"Assuming that the law will be changed to allow same-sex couples to marry in Australia, this will generate net economic benefits for the nation as a whole over the next 10 years."

Agree

8

Poll 23

Question A: "Holding labor market institutions and job training fixed, rising use of robots and artificial intelligence is likely to increase substantially the number of workers in Australia who are unemployed for long periods."

Question B: "Rising use of robots and artificial intelligence in Australia is likely to create benefits large enough that they could be used to compensate those workers who are substantially negatively affected for their lost wages."

A - Disagree

B - Agree

Productivity gains are the foundation of improved standards of living across the community. Technology change can cause dislocation, and different groups of workers - for example, by skill level and type, experience and location - will be affected differently. An important distributional issue is to ensure groups more strongly impacted are appropriately supported.

Poll 15

"It is more effective to teach an introductory course in micro-economics first before an introductory course in macro-economics."

Agree

8

Poll 18

"Given the Commonwealth Treasury?s ongoing difficulty in making accurate forecasts of some of the key economic variables underpinning the Budget ? in particular nominal GDP growth ? the Government should ?outsource? the economic forecasts used in framing the Budget to an independent agency (such as the Parliamentary Budget Office), as now happens in the United Kingdom."

Agree

8

Having an agency at arms length from govt should reduce the risk of political interference in the Budget forecasting process. This, in turn, has the potential to improve the credibility and accuracy of key forecasts.

Poll 13

"Hillary Clinton is likely to be the superior US presidential candidate for the Australian economy and for Australia."

Strongly agree

10

It is challenging to distil a coherent economic plan from Trump's public announcements during the election campaign. Clinton's stated plan and public policy experience make her the compelling candidate.

Poll 17

"In response to energy shortages around Australia, government policies requiring gas producers to reserve some production for domestic consumption are a good way to ensure that Australian consumers have access to sufficient gas supplies while still allowing for gas exports."

Agree

5

The total benefit of current levels* of migration to Australia will outweigh the total costs to Australia's economy.

Agree

9

Poll 11

Part 1: 'Behavioural economics provides new and useful insights into individual behaviour.'

Part 2: 'It is unethical for governments to use behavioural economics to "nudge" citizens.'

PART 1 - Strongly disagree

9

PART 2 - Strongly disagree

9

Poll 9

"Assuming it is implemented, Brexit will deliver net economic benefits, on average, to UK citizens within its first 5 years."

Strongly disagree

9

Poll 8

"Australia will receive a bigger economic growth dividend in the long-run by spending on education than offering an equivalent amount of money on a tax cut to business."

Agree

8

The social return to the investment in human capital I would expect to be greater. The specific details of the 2 policy options would clearly be important; the potential return on investment in schooling at early stages of the life-cycle are very high.

Poll 7

"The recently released 2016-17 Commonwealth Budget projects that the Australian Government's underlying cash balance will return to surplus by 2020?21*. Australian politicians should rebalance the budget with greater urgency."

Strongly agree

9

Poll 5

"Government investments in major sporting events usually generate net benefits for the city or region where the investment is made."

Disagree

10

Poll 3

"Giving specific presents as holiday gifts is inefficient, because recipients could satisfy their preferences much better with cash."

Disagree

9

There is a literature on this - the quote is based on a very static perspective. In an evolutionary context, gift giving can have important implications for building trust and cooperation. Gifts can be useless but the institution of gift-giving may be very valuable.