Blinkered partisanship is the main reason why I created this board - to try to keep it off the other boards as much as possible. Even so, can still be rather tedious.
Blinkered partisanship usually takes the form of attributing the cause of all problems to the party that happened to be in power at the time. People do not look past this to what was actually done to cause the problem, beyond what is necessary to give their argument at least some credibility by linking to the government of the day in any manner possible. It also tends to assume that things happen in a historical and geographical vacuum, despite the fact that the majority of the causes can often be traced overseas or back to previous times.
This is especially common with economic issues, in part because most people do not understand the real causes. Also, most economic decisions from government have opposite short and long term impacts. A government can do a lot of damage to the long term prosperity of a country with actions that make things appear good in the short term. Most reforms for the long term good of the country come at some short term cost to the economy. The costs of economic decisions also tend to be far more visible than the benefits. For example cutting off an industry that is dependent on subsidies or protectionism will be directly linked with the job losses from that industry, but won't be linked to the improved performance of the rest of the economy.
Political policy will cause the local effects. But equally important is positive or negative perceptions resulting in confidence or lack thereof.
Global concerns are less of an issue than many think. Blaming prosperity on an alleged 'mining boom' or economic downturn on 'sub prime mortgage failure' is ignoring reality.
The truth is neither have any reason to impact Australia much, if at all.
If you want to see how the government of the day can impact on perception you need go no further than today's news.
Tax cuts safe as Labor seeks budget cutsTax cuts will escape the axe as the federal government searches for ways to cut spending as a hedge against inflation.
The Rudd government will run a strict eye over all commonwealth spending - particularly promises made by the previous Howard government - as it looks to save billions of dollars ahead of the May 13 budget.
Fifteen billion dollars worth of coalition promises, due to be introduced over the next four years, will be placed under scrutiny.
But Finance Minister Lindsay Tanner promised the Labor government would not renege on its $31 billion in promised tax cuts.
The opposition claims Labor is trying to rewrite history by painting the Howard government as bad economic managers in order to blame them when interest rates go up again.
Two of Australia's biggest banks last week raised interest rates independently of the Reserve Bank of Australia (RBA), which will examine the case for another hike on February 5.
Economists believe there is a distinct possibility the RBA will lift official rates from their current 6.75 per cent as inflation remains a problem for at least the next 18 months.
The RBA will pay close attention to December quarter inflation figures due on January 23.
Mr Tanner said inflation was heading beyond the central bank's target band of two to three per cent.
"Inflation is getting beyond the three per cent level that is the outer limit of the Reserve Bank zone," he told Sky News.
And despite an interest rate hike in November, retail figures show no signs of consumption slowing.
Data from the Australian Retailers Association (ARA) showed spending for Christmas 2007 up 7.4 per cent at $36.5 billion.
Mr Tanner said it was crucial to keep inflation under control and nothing would escape the attention of the economic razor gang as it looked for ways to trim the budget to reduce inflationary pressures.
"We will be scrutinising all of the pre-election spending commitments which were made at the last minute by the Howard government," he told Sky News.
"It's critical that we get some serious discipline back into government spending, that we strengthen the budget surplus and that we put more downward pressure on inflation and interest rates.
"We will be dealing with all spending commitments, all programs on their merits ... but we are in a tough environment."
Despite the commitment to tackle inflation, $31 billion in promised tax cuts for low and middle income earners will remain sacrosanct.
"We believe that the tax cuts were of a responsible magnitude," Mr Tanner said.
Link What's your take on this? Let's see how you can read the economic impact of a current government action.
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