I’ve come to the conclusion that the world needs a new “onomics” label as a means to exhume ourselves from the current global financial and economic crisis. No, it’s not “Obamanomics”, nor “Ruddonomics”. It’s “Shrinkonomics”.
“Shrinkonomics” I define as restoring consumer confidence by using psychology to subconsciously implant into the minds of Australians the seeds of hope for economic prosperity.
The Federal Government’s panicked and war-style rhetoric in dealing with the economic crisis will do little to inspire public confidence and resurrect a deflated economy.
Australians have taken a psychological battering from the negative economic news stories transmitted into our homes. Rather than relentless gloomy rhetoric, leaders across political spectrums and the media need to somehow find a means to collectively lift Australians off shrinks’ consulting couches across the nation.
One facet of “Shrinkonomics” is where the government establishes a “war” style advisory cabinet inclusive of members across the political divide. This will require setting aside the ideologically drawn battlelines between Australia’s political combatants.
Economic downturns, including recessions, do not necessarily discriminate based on which political party is in power or their philosophical political or economic allegiances. And no one economic theory, whether it’d be Keynesian, Monetarism, or any other economic ideological prescription will offer an all encompassing cure. All can play a role in alleviating the economic ills and subsequently contribute to the next phase of economic and social prosperity.
To confront this globally induced crisis, the government should therefore leverage the knowledge, experience and wisdom of individuals with differing philosophical slants across political spectrums. This inclusiveness should particularly be the case of our former Prime Ministers and State Premiers, including the likes of John Howard, Bob Hawke, Paul Keating and Nick Greiner. Instead, Australia’s political system tends to have a predisposition in putting them out to political pasture.
The US has a greater level of respect and public affection for their past political leaders and puts them to more productive public use. It perhaps demonstrates a level of immaturity within Australia’s political system.
If our Prime Minster wishes to demonstrate true leadership for the nation and boost public confidence in the midst of this crisis, then there needs to be a public demonstration that the leaders of our nation are united in their endeavours to overcome this crisis. This apparently politically unpalatable proposition is the path down which we need to venture. This is what real bi-partisanship is. The present political posturing between the Prime Minister and the Opposition Coalition leader will not plant the seeds of hope for Australia’s future prosperity. Healthy debate yes, political gamesmanship no.
A second aspect of “Shrinkonomics” is demonstrating that while there’s plenty of sombre news around, we should be taking a half glass full approach rather than a half empty one.
We currently have an unemployment rate of 4.5 per cent, which also means 95.5 per cent of people are employed. We have an economy holding up better than many others, with the UK, the US and Iceland being cases in point. We have one of the soundest banking systems in the world, in which just recently all of Australia’s top four banks ranked in the top 20 of global banks. We now also have the lowest interest rates in decades which present great investment opportunities, for both businesses and consumers. And world governments are doing their best with traditional and new economic tools and levers to see us through this crisis.
So while we are inexorably linked to the fortunes of other economies, Australia, to date, appears to have weathered the storm relatively well. Moving forward, I believe there’s much to be optimistic about. We just need to be promoting the positives more actively than has recently been the case, and working more closely together to see us through this time.
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