Journalists play the fool in the ‘economic reform’ theatre of the absurd

Did you enjoy the media coverage of the Business Council’s economic reform discussion paper “Living on borrowed time” this week?

“Business Council boss Jennifer Westacott wants to ignite a national conversation and convince everyday Australians of the merits of big economic reform,” wrote an Australian Financial Review journalist. “Everyone would be $10,000 better off over the decade if measures were introduced to boost productivity and stop it from ‘acting as a handbrake on the economy’.”

“The Business Council of Australia has launched a new campaign with a long ‘to-do’ list,” said a report in The Australian. “BCA chief executive Jennifer Westacott said the plan aimed for better and more jobs, higher wages, lower taxes, improved living standards, and lower energy prices.”

“The BCA are putting forward a plan essentially for wages growth today … So will this work?” Westacott was asked on Sky News. “We’ve got a very narrow economy where too many eggs in one basket,” she replied. “By way of example, 10 companies pay 30% of all of the corporate tax. We’re very reliant on a few industries. We’ve got wages growth, to your point, stagnating and I think that creates a lot of stagnation in the community. What’s driving that is low productivity and low business investment.”

“The Business Council of Australia has warned if the economy is allowed to just ‘muddle along’, the nation will be laden with an extra $50 billion of debt every year, ran an AAP report. “In a new report released ahead of next Tuesday’s federal budget, it says without stronger growth Australia will sleepwalk into a state of widening deficits, lower living standards and a heightened vulnerability to economic shocks.”

“The Business Council on Wednesday released a discussion paper entitled ‘Living on borrowed time’ in a bid to start a national debate about ways to lift economic and productivity growth over coming years,” wrote a Nine journalist…

Oh, wait, hang on. I got muddled. None of these are from this week. They’re from the coverage of the BCA’s last two “economic reform” ukases in 2019 and 2021. Sorry.

Sadly, despite the BCA featuring a number of Australia’s worst profiteers and price gougers in its membership ranks, there’s no evidence of inflation in the BCA’s rhetoric: a couple of years ago we were all going to be $10,000 better off if we did what the BCA wanted, but it’s now just $7000 each.

That none of the journalists involved appears to have noticed this shrinking of benefits, or remembered that the BCA produced exactly the same demand for reforms a couple of years ago — even when they themselves covered it — illustrates how absurd this endless cycle of “economic reform” debate is.

This week, Westacott appeared on ABC’s 7.30 to be interviewed by Sarah Ferguson, who appeared oblivious to the endlessly reheated nature of what the BCA is demanding. “This report, called ‘Seizing the moment’, so full of life and drama,” Ferguson — usually known as a ferocious interviewer — gushed to Westacott, who was allowed to repeat, unchallenged, the BCA’s easily disproved claims that company tax cuts would increase investment, productivity and wages.

But this media failure goes further. Rather than do their jobs and sceptically assess the claims of the BCA, journalists then added it to the political agenda of the day.

“Following the BCA’s report published this morning, do you accept a reformed blueprint to overhaul the industrial relations and tax system?” one witless journalist asked the prime minister on Monday. Treasurer Jim Chalmers took questions on it on Monday as well, and then was asked by Ferguson about it on 7.30 last night. Chalmers rightly rejected the idea of company tax cuts. This then spurred further analysis and comment from the press gallery about the government’s lack of appetite for big reform — with no journalist involved bothering to even factcheck the BCA’s lies about company tax cuts.

This is theatre of the absurd stuff. A pack of profiteers and gougers simply repeats the same drivel it has been uttering for at least a decade, slaps a different name on it, has it covered straight-faced by journalists who pretend they’ve never heard it before, leading to other journalists to quiz politicians about it as though it’s a legitimate matter of public debate, prompting chin-stroking commentary about the terrible state of politics.

It’s entirely vapid at best and deeply disingenuous at worst, a reflection of how shallow, amnesiac and incapable of original thought and scepticism mainstream media journalism is that this circle-jerk constitutes economic debate in Australia.

The only meaningful part of any of this occurred yesterday, when Chalmers and Assistant Competition Minister Andrew Leigh announced they were establishing a taskforce within treasury to consider upgrading Australia’s competition policy framework, with an advisory committee including the Grattan Institute’s Danielle Wood and former Australian Competition and Consumer Commission head Rod Sims.

The involvement of Wood and Sims augurs well that this won’t be an idle exercise: Sims has been a strong advocate for significantly strengthening competition laws to address the high levels of concentration in the Australian economy. And in her wonderful speech at the jobs summit last year, Wood spoke about the need for competition laws that were fit for purpose. The issue of competition is also one that is dear to the heart of Leigh.

Real competition laws in Australia would deliver the power to regulators to break up — or heavily regulate the pricing power of — our biggest companies and worst profiteers.

Curbing market concentration is crucial to lifting investment, reducing inflation, increasing wages and boosting productivity — the links between large, dominant companies and underinvestment, profiteering, poor productivity and low wages growth are all well-established. It’s one of the biggest issues facing Australia. Chalmers was barely asked about competition at the media conference announcing the taskforce, and not at all by Ferguson.

The BCA doesn’t like the idea of strengthening competition laws. “We are cautious about the risks to the economy if merger activity is stifled by overzealous and uncertain regulation at a time where Australian industry needs to scale to compete globally,” Westacott said in response to Chalmers.

That fear in the eyes of big business should be a big hint to the media about what’s really important in the economy. Instead, they’re too busy capering and gambolling in a policy pantomime driven by greed and amnesia.