Max Ehrenfreund is running the Political Animal blog this weekend. He’s a smart young man. But he is a bit wrong in his thinking about the recent Australian election that threw the Labor Party out of power and put the conservatives in power. The situation there is quite interesting. The Labor Party has been in power for 6 years and because of their policies, the economy (and much else in the country) is doing pretty well. But there has been a lot of infighting within the party and the people are sick of it. So they threw the bums out!
Where Ehrenfreund gets it wrong is in thinking this means that economics doesn’t matter as much as we have thought. He wrote:
I think what’s gone on is that the people have forgotten just how bad conservative policies are. They are taking the relatively good economy as a given and thinking that they can put the conservatives in charge and everything will be fine. And they might be right. For one thing, the conservatives in Australia are not as bad as the conservatives here in America. And even conservatives here usually take a little time to destroy the successes of liberal governments.
But let’s not forget that Australian unemployment has also been rising the last couple of years. It isn’t a large increase, but it is enough to cause the people to assume that the liberal government isn’t doing that much for them. Sure, they managed the 2009 recession well, but what have they done lately? So it makes some sense for the people to consider trying a new government. And the new prime minister Tony Abbott is not completely unappealing. He panders well to the worst instincts in people like nativism. His economic policies are the same as any conservative: he will cut taxes and regulations. And as usually, this will primarily make the rich richer. It will help the economy a bit because cutting taxes does that. But cutting environmental regulations during a recession is almost certainly counterproductive. And he wants to “cut spending and balance the budget.” So I suspect that the Australian economy will start doing even worse and soon the people will want the liberals back.
Of course, Ehrenfreund is right that the fundamental problem is that voters are not rational enough. In particular, they tend to fall for this same nonsense about cutting spending as though that’s going to make the economy better. But as the conservatives screw up the economy (and they always do), I’m sure we will see the Australian people acting very rational.