Tuesday, 28 April 2015

Book Review - Confessions of a failed Finance Minister by Peter Walsh

Confessions of a failed Finance Minister by Peter Walsh

Sydney: Random House Australia, 1995                                 ISBN 0091829992

The recent death of Peter Walsh at the age of 80 drew me back to this book, which I read with interest when it first came out. While some parts of the book have dated a little, the strength of the book - Walsh's clear-eyed view of how to best serve the working men and women of Australia - is even stronger now than when it was written.

Walsh's book is not a political memoir in the usual sense, but more a description of how politics can corrupt good policy. Walsh was one of the few clear-eyed members of the Labor government of the 80s and 90s: he, unlike many other politicians, fully understands that for governments to achieve anything, they need to make the best use of the money that they coerce from the public. This involves a rational look at all options, and ensuring that the scarce funding goes to the best place to do the best thing.

As a reader might guess from the title, Walsh feels that the government he was part of - most importantly as Finance Minister - while doing some good things, mostly squibbed their chance.

In some ways the best way to describe the tone of this book is to quote from it - it helps that Walsh is eminently readable. Some examples follow -

"It is easy to understand the politics behind grandfathering [re: instituting means testing of pensions]....but its moral justification is suspect to say the least. It says that existing beneficiaries of anomalies and rorts can continue to receive them, but no new entrants will be permitted. It is certainly discriminatory, but does not attract the attention of 'anti-discrimination' activists and their hangers on."

Regarding the Bureau of Agricultural Economics claim that that a 10 percent sales tax on wine would reduce sales by 14 percent - "Even if retail prices increased by 10 per cent - which they wouldn't - demand elasticities of 1.4 per cent are only found where there is a close substitute. There is no close substitute for cask or flagon wine. At the upper restaurant end of the market, anyone who can afford to eat in a restaurant in the first place will not be deterred from buying a $15 bottle, or a second bottle, because the price had gone up by 75 cents."

Regarding uranium sales, a vexed issue for the Labor party throughout the 80s and 90s - "But because the French tested weapons in the South Pacific and supplied nuclear technology, the ban on sales [of uranium] to France was retained. (They were also primarily responsible for the EEC Common Agricultural Policy, and half of them were on Hitler's side during the War.)"

When dealing with the Department of Foreign Affairs' objection to the Finance Department's proposal to sell surplus land in Tokyo - "The Japanese Government would be deeply offended. The site contained an ancient well, almost a Japanese sacred site. (The answer to that was if the well was so important, and since Japan had the world's biggest current account surplus and we had about the world's biggest deficit, the Japanese Government could buy it.)"

On former education minister Susan Ryan - "Susan carried throughout her political career much of the Whtlam-era baggage, including a naive affinity to China. Following her visit to China in 1976, she told me we could learn a great deal from China, to which I replied 'Cut it out, Susan, if you and I were in China we would both be in concentration camps'." [and Walsh claims to have liked Ryan!]

When the government was declining, and Walsh was getting sick of the slippage he addressed a Labor lawyers conference "that the Budget was being 'oversold' (all Keating's Budgets were), that the new Parliament House was a scandalous waste of money, that the country was still in economic jeopardy, that expectations must be scaled down; and told the bleeding hearts that Labor's child care policies which delivered subsidies of up to $100 a week to some, regardless of how high their household income was, while the vast majority of women with pre-school age kids who plucked chooks at Inghams for less than $300 a week got nothing, were a disgrace."

He continues on in this vein - he describes Hawke as vain and too engrossed in being a statesman, Keating as someone not as smart as he thought he was, and many other ministers as wilfully ignorant or beholden to vested interests to the detriment of good government. Hawke famously said "My friend Peter always was a Cassandra", and Walsh points out that Hawke's ignorance of Greek mythology led him to inadvertently hit the nail on the head - Walsh knew what was going to happen, but nobody believed him (he at least was able to use that line to his own advantage - for many years writing a column named the Cassandra Column for the Australian Financial Review).

Walsh was always focussed on how the government could most effectively assist working people without feathering the beds of the middle classes. He abhorred tariffs, industry assistance and non means-tested handouts.

What is most depressing about reading this book in 2015 is not the grubby politics that occurred during Walsh's time, but that when one looks around the current political arena there are no Walsh's on any side of politics to cut through the spin and ensure that a government does what it should.

I wonder if we'll see his type again.

For anyone interested in Australian political history, and those who want to think about what it is to have good government, this book is well worth reading.

Cheers for now, from
A View Over the Bell

No comments:

Post a Comment