The John Hyde Archives
Historic archive of articles and newspaper columns written by former Australian politician John Hyde OAM.
Economics
Fraser's Budget error - not enough Thatcher
- During the 82/83 years, the treasury expects gross product to fall and likewise, real wage earnings should also fall. If not, unemployment will increase.
- Only if a UK type strategy is adopted, which is a long-term strategy of growing real product demand faster than real wage increases.
Some heavy losses but the battle continues
- Dry politicians reflect the changing view of how an economy should be run.
Labour's stand on sales tax should be queried
- A Tariff tax falls most heavily on necessities of life versus a sales tax which falls most heavily on luxury goods.
Facing up to structural change
- The Australian government cannot do much to prevent the world trade patterns from changing.
- Various interests need to be more balanced in a fair manner.
An evaluation of OECD cures for economic ills
Economics Currencies & Commodities Economics
- General world economic downturn, poor world commodities markets and the drought have caused Australia to suffer a shock worse than Japan's oil shocks.
An evaluation of OECD cures for economic ills
Economics Currencies & Commodities Economics
- General world economic downturn, poor world commodities markets and the drought have caused Australia to suffer a shock worse than Japan's oil shocks.
Unknown
- Defensive protectionist policies make things worse.
- Australian trade is much more restrained compared to similar sized economies.
- Nations which have unilaterally reduced their trade barriers have achieved higher rates of economic growth.
When is a Wage Freeze not a Freeze?
Industrial Relations Economics
- Wages must increase less than prices.
- High wages decrease demand
Unknown
- Political restructuring is essential and part of the process.
- In a commercial setting, people "vote" using their dollars. It is then wrong that their votes are confiscated by limiting their choices to certain anointed candidates in a political setting.
- If Australia is unable to accept steady restructuring of our industries in accordance to market demands, then bloody restructuring becomes necessary when we become impoverished.
Foreign Investment
- Investors are only interested in Australian investments that perform better than elsewhere.
- No investment can take place without the foreign buyer and Australian seller gaining something.
- As long as there are investments that Australians are unwilling to finance, foreign investments will provide jobs and additional incomes.
Unknown
- The selfish use of privilege will destroy the free Australia that men fought for.
The opposition and the Mini Budget
- If Labour does a better job of managing the economy, then the Liberal party will be in opposition for a long time.
Wage-fixing priesthood keeps its god alive
Industrial Relations Economics
- Centralised wage-fixing is the creation of jobs for some who would otherwise be unemployed.
- A minimum wage is often set so high that it comes the permanent wage of those in the group with employers unwilling to offer more to capable individuals.
- Marginal employees such as the young, old, and unskilled are permanently shut out.
Thatcher's Victory
- Two myths were: 1) society has a deep-seated prejudice against women & 2) elections are won by a party that espouses the middle ground.
- People voted for hope that the economy would get better
- A democratic government can earn the respect of its people by governing for the long term.
BHP
- The bigger a company becomes with government intervention, the more damage to an economy it can do.
- BHP is seeking a preference over smaller businesses when it comes to subsidies.
The Long Term
- A nation whose economy stagnates will become hard to govern.
- Poor growth also compounds political problems that are associated.
Choosing the right index
Economics Industrial Relations
- For indexing wages, the right index must be chosen. Lest we get more unemployment.
- If the CPI is used to index wages, then we should exclude the effects in terms of trade, taxes and devaluation from it.
A great trading nation
- Countries with small economies must trade with foreigners while citizens of large economies have a range of specialist skills that enable them to trade with each other.
- Australia's trade is getting worse over the years.
Statutory Marketing Authorities
- An industry that depends on world markets cannot avoid change. By delaying just long enough, many who have neither learnt to swim or moved to a higher ground will drown.
Their Own Worst Enemies
- The capitalist economy has a better track record than the socialist economy and so there is no need to apologise for it.
Facing 1984
- Productivity may be improved by effort, improved practices or increased capital per worker
- Our productivity gains are less than other countries and is not sustainable.
Entrepreneurs
Economics Regulation Cronyism Business
- Entrepreneurs are first forwards looking decision makers, but often become crony business managers once estabilished.
Thomas Sowell & Walter Williams
- Sowell & Williams argue that racism, discrimination & poverty are minimised where markets are the freest and are worsened by government intervention.
- Affirmative action has created an action not to hire groups.
- Sowell has insisted that he has faith not in the market but rather the evidence about the market.
Taxes and Economic Growth
- High taxes are hostile to economic growth and hence to higher living standards.
- Link between high taxes and lower productivity, lower private consumption and lower life expectancies.
Labour's style
Politics Industrial Relations Economics Business
- Bob Hawke ceded authority to those whom should not have authority.
- He expected big business to follow the government's lead on when and where to invest.
- His government is a corporatist consensus of government, big capital and big union.
Occam's Razor
Taxation Subsidies Politics Economics
- It is remarkable that socialists think that the free world's financial system to blame for third world poverty.
- There is no obligation for a liberal society to tax itself to subsidise conversation & peace movements.
Productivity & Living Standard
- Australian productivity has not kept up with living standards from 1969 in a 13-year period.
- Consumption has outstripped production; investment per head has declined.
International Comparisons
- Comparison of Australia's economic performance with other nations
- Slower growth rate compared to the UK (Study of a group of developed nations)
- Even with our resources (Aus. & NZ), our living standards have fallen behind resource poor countries of Western Europe
- With our lower economic performance, there might be a labour and skill migration of Australian to other countries.
Japan's Ministry (MITI)
Economics Business Industrial Relations
- Japanese Government assisted in economic growth by restraining itself from interfering with the economy.
- Japan's industrial policies are the best because the government interference is the least.
Rich Land, Poor Land
- Those that followed economic wisdom the closest increased their people's standard of living the most. (Ghana v Taiwan)
Brookings on Deficits
Budget Monetary Policy Fiscal Policy Economics
- Aside from printing money, a govt deficit must be financed by bidding for the same funds that private investors seek.
- Brookings' objection to a high budget deficit is that it will reduce economic growth by increasing consumption at the expense of investment.
- Deficits allow govts to spend money that is not raised in taxes.
Whither the Liberals
- There are three philosophical positions: 1) The Dries (Free market advocates), 2) The Wets (Keynesian Big Govt advocates) and 3) The Uglies (preservers of status quo).
- Due to the people seeing political corruption, a demagogue may just get enough support by posing as a Dry or Wet to turn the Opposition's philosophy away from a more open, free and personally responsible position.
Kasper's Schumpeter Lecture
- He opposes Keynesian theory that productivity is unchanging. His theory is that capitalism improves productivity through entrepreneurs.
- Every fifty years or so, the world goes through burst of innovation that is concentrated in certain areas.
Restructuring the High Cost Industries
Industrial Relations Economics
- Restructuring means releasing resources from high cost activities to invest in low cost activities.
The Underlying Economic Problem: John Brunner
- Either production must be increased substantially, or consumption must be decreased drastically.
New Zealand and Sri Lanka
- A democrat can, given the right circumstances, successfully implement long term economic goals.
The Ultimate Cost of Protection
Protectionism Politics Trade Economics
- Australia is paying a heavy social price for a closed economy. Only by reducing border protection is there a possibility of turning things around.
The Crunch
Industrial Relations Economics Politics
- If Bob Hawke feels that he is too weak to defy vested interests, he will sow the seeds of economic decline for everybody.
Industrial Policy
- Only a free market economy with strong positive and negative incentives can stimulate productivity.
Going for Growth or For Broke
- Foreign capital used for growth is no cause for concern. Only if it is used to finance current consumption.
Lange's Economy
- Mr David Lange is the man who steered the New Zealand economy to eventual recovery by using free market principles.
Transparency II
Protectionism Politics Economics
- Industry specific councils are a menace which should not be given any standing when forming public policy.
Fools or Knaves? The Reith Lectures
- Our current politicians favour interventionism, the question is whether they are knaves or fools? *
Fraser On Howard
- The question facing the next Prime Minister is whether they will tackle our economic crisis without deferring to vested interests.
A Crisis of the Spirit
- If Australians are to accept that there must be uneven sacrifices, we must feel that we are going somewhere.
What is Unemployment?
- Unemployment figures are no longer a good proxy for economic distress which must be identified more directly.
The NFF Seeks Audience
- The National Farmers Federation (NFF)'s paper argues that the government's policies are unable to cope with changes.
Petersen et al
- Debt and inflation are now so serious they must be remedied with a strong and specific political mandate.
The Rocky Horror Show
- The deficit should be reduced by cutting government expenditure instead of raising taxes.
- The proven way to economic success is through deregulation.
The Deficit 1987
Economics Taxation Fiscal Policy
- When governments borrow rather than raise taxes, there are several consequences: 1) The young lose, 2) investments drop, 3) The country's credit rating suffers, 4) The police are required to force people to service the debt, 5) Foreign debt accumulates and 6) The government is tempted to inflate the currency.
South Africa
- Political power is least important in a liberal free market society with a small government.
The Campaign Issues
Politics Regulation Industrial Relations Economics
- John Howard's policy stances are more like Margaret Thatcher than he is given credit for.
- The important issue is to increase efficiency without which Australia is sunk. Tax cuts matter but not so much as deregulation and industrial relations reform.
Investment: Where will it come from?
- If private savings and investments are to increase, then the people must reduce their consumption. However, there is a danger that households might maintain their current living standards and savings levels might decrease.
When Elephants Mate
- Corporatism (consensus of elected elites) can produce good outcomes, Singapore, Austria and Sweden are often cited as good examples of successful corporatist governments. However, only fools expect elites to remain benevolent even if they started that way. It is in the human nature to use power to guard personal status.
The Rules of The Game
- Economic necessity is forcing the individual to accept change and in the long run good procedures in support of good principles should generate good outcomes.
Testing the Heroes: Liberalism Under Fire
- The importance of Menzies, Locke & Co for our current problems whether their insights and actions will enable us to think more effective about solving our current situation.
World Trade
- Everything in an economy relates to everything else. One industry's protection is always another's cost.
- International trade is always governed by domestic politics.
The Stock Market and History
Politics Economics Monetary Policy
- The cause of the Great Depression was not the stock market collapse but the result of poor government policies. The politicians should allow the markets to adjust accordingly instead of intervening and making things worse.
Private Correspondence
- By deregulating our economy, we will be able to pay our public debts.
A Deregulation LED Recovery
- Deregulating will do more for the economy than getting the people to reduce their living standards.
Micro Economic Reform
- Whenever there is an economic crisis, vested interests lose their hold over the government.
- Unfortunately, some parties are prepared for the country to be destroyed rather than give up their interests.
A Tale of Two Nations
- The message for Australia and Fiji is that we have a choice between raising our gross national product or lower our standards of living.
- It is either deregulate or decay.
Public Sector Accountability
- The WA government should not have initiated public sector activity which displays the usual inefficiency.
- The real problem is that that when Western Australian politicians introduce government into commerce, they often abuse the trust that is placed upon them.
What Price the Accord?
- The accord has delivered wage restraint at a cost which is the higher levels of overseas debt and higher account deficit.
The Liberals Won't Tax Gold
- The economic objection to an industry paying less than its share of taxation is that some other industry will have to pick up the slack and comparative advantage of each industry is ignored.
Tariffs: The Beam in Our Eyes
- Even though tariffs lower living standards, politicians use them to win over some voters.
What's Political Important In 1989?
- Political corruption, foreign debt and declining living standards are the big issues in 1989.
Say Not the Struggle Naught Availeth
- As Dry policies are being implemented, any lags between implementation and consequences must be explained as must any mistakes or unrelated causes.
How to Generate Poverty Without Really Trying
- To alleviate poverty, most of the poor will become rich only by given the opportunity to work, save and exchanging their goods and services.
Chile
- Chile to become an economic success story. Reform included reducing tariffs to a flat 15% and substantially deregulating labour market.
Not So New Federalism
- The Australian economy will not recover until the people who make the economic decisions face the consequences of their own decisions.
Macphee
- Since 1974, both the Labour and Liberal parties have adopted freer market policies, but Mr Macphee has not changed his positions.
Trade Policy
- The problem is that Australians are consuming more than they produce. Until that is fixed, there is no reduction of the trade deficit.
Ian McLachlan
- Mr McLachlan's H.R Nichols Society address was significant in that it addressed waterfront work practices and he is a future Liberal MP with leadership potential.
Of Ethics and The Economy
- In this current climate, our government places electoral interests ahead of policies that will benefit society overall.
Interest Rates Are Not Doing the Job
Interest Rates Economics Business
- When there is not a need to rely on interest rates to kill demand, the inflow of foreign investment will fall.
Des Moore
- Des Moore of the IPA had two recommendations: 1) debt does matter 2) monetary policy must be tightened.
Those Vietnamese Refugees
- The immigration of any group that is willing to integrate into Australian society is good as the group will enrich the economy and society.
Joining East Asia
- The most important lesson that we can learn is the export orientation for the most successful countries is high and even going to the extent of subsidising exports.
Roger Douglas II
- To fix the economy, our political leaders may look to New Zealand's former Finance Minister who has led market reforms to their economy.
The Good Fight
- Austin Stewart Holmes was one of Australia's finest civil servants and a true servant to democracy.
- Mr Holmes was an honest true servant to democracy.
The Tortoise and The Hare
- The fundamental fact of democratic politics is that any support for change must be generated by the leadership explaining the changes to the people.
The Election and The Debt
- The incoming government must deal with the problem of excessive foreign debt. Increased productivity is the only way to go.
Some Budget Cuts
- We might have more confidence in the political parties if they would face up to economic problems instead of just promises to spend more.
The Small Business Lobby
- The corporatist style of government has failed, and the best thing of small business owners is to have a level playing field.
By the Year 2000
- The most significant changes will be our own attitudes and the sort of society we have in the 2000s will be of our own making.
Inflation
Economics Currencies & Commodities
- To prevent inflation, people must be given reason to expect that prices of things they buy will stop rising.
- Currency management should be done independently from the government by the Reserve Bank and the board of the Reserve Bank held to account.
Wool Again
- The demand for wool is elastic due to substitutes, there is no reason why the wool industry should have price controls in place.
Doomsaying
- Markets provide feedback for us to correct past mistakes and embrace new opportunities. By taking what doomsayers at their own value, if we implement policies that restrict opportunities, we place our society in real danger.
Rural Inconsistency
- It is hypocritical for Liberals to advocate for a free-market approach yet refuse to abolish the reserve price for wool.
Of Debt and Protection
- If Australia is to become internationally competitive, we need to reduce tariffs as well as our debt levels.
A Voice from The Wilderness
- The failure to understand opportunity cost has resulted in needlessly expensive environmental protection.
- It is not possible to regulate demand and when bureaucrats fail to control human behaviour, they blame economists for the mess.
The Coming Year
- Australia has more artificial barriers to high productivity than almost any other nation, in order for the economy to recover with minimal pain we need to have wholesale improvement in productivity and abolish the barriers.
The Wage Case
Industrial Relations Economics
- High minimum wages kill off jobs and increase foreign debt. In order for Australia to have a trade surplus, Australians must improve competitiveness sustainably. Unit costs must be lower than other countries.
Housing
Regulation Property Rights Economics
- Legislation that reduces a landlord's right to raise rent or to evict tenants reduce supply and drives up rents anyway. Paul Keating deregulates the cost of home purchases while the Minster for Housing regulates rents. It will not work.
What Should We Expect of The Rest Of 1987?
- Australians have been becoming wealthier but at a slower rate compared to other nations.
The 1930s, The 1980s And Beyond
- Recessions cannot be permanently avoided and due to our industries being unproductive is exacerbating the problems that we are facing due to our borrowing and a world depression.
Of Rural Industry and The Economy
- The reason for our relative economic decline is the failure to seek out areas where we have comparative advantage.
- For the moment, primary industry such as farming, and mining is where we are efficient.
The Real Exchange Rate
Currencies & Commodities Monetary Policy Economics
- The solution to our problems is to raise productivity by deregulating and privatising and encouraging saving.
- The coming devaluation of our currency will increase inflation can be prevented by increasing wages and other costs as long as necessary.
What We Should Expect of The New Government?
- There is a rough consensus about what needs to be done to restore dynamism to the economy, what is lacking is the political will.
Waste in NSW
- The NSW government run on the platform of deregulation and privatisation.
- Micro-economic reform is eliminating waste and failure and is always opposed by people who lose their benefits and seldom praised enough by those who gain from the new efficiencies.
Every Galah in The Country Is Parroting Micro-Economic Reform
- The relevance of micro-economic reform is that reduction in foreign debt leads to a more productive economy and an increase in living standards. However, it tends to be resisted by those that need it the most.
How to Create an Oil Crisis
Economics Business Currencies & Commodities
- If you stop oil companies from making profits, they will stop delivering fuel to our vehicles, the situation would be made worse.
How They Will Govern
- There is a trend of deregulation and privatisation where the skills of a producer are rewarded over that of a lobbyist. This is Australia's only hope.
Who Is the Most Socialist?
- The ranking correlates with capital payments to the States by the Federal Government. The States have spent the payments increasing the size of state governments instead of compensating the private sector.
A Lesson from Argentina
- Australia and Argentina are similar in many ways. We have not made major mistakes in handling our economy but have been careless about long term growth.
- If we mismanage our economy, we will not be able to escape problems similar to what Argentina faced.
Their Own Worst Enemies
- Private ownership is where the citizen gains protection from the state and it not only an economic question but also moral and ethical questions. It should not get into bed with government.
Entrepreneurs
Economics Protectionism Business
- The switching of commercial to political entrepreneurship, established interests have encourage governments to protect their interests as well as causing the economies to stagnate.
Australian And United States Deficit
Budget Economics Fiscal Policy
- Both the US and Australia have penalised investing by spending consuming more and will cause a reduction in productivity and hamper long-term economic growth.
The Election Result
Politics Budget Taxation Economics Fiscal Policy
- The election campaign extracted three promises from Bob Hawke: 1) no tax increases, 2) no increase in government expenditure without economic growth and 3) reduction in the budget deficit.
About
John Hyde OAM is a former Australian politician. He was elected as the member for the Division of Moore in Western Australia for the Liberal Party.
John Hyde OAM is the author of Dry: In Defence of Economic Freedom.