Jobsworths in Treasury miss the (decimal) point

The deficit is just the bottom line of a whole series of spending and revenue figures.

Just stick with the way we’ve always seen the world and done things, wrapped up in meaningless moronic exactitude.

It’s the two decimal points that are so damning of Treasury and Treasurer. They capture and broadcast to the world the meaningless exactitude of the moronic.

There they are on the first page of Thursday’s Economic and Fiscal Update. That the deficit estimated for the 2019-20 fiscal year is $85.8bn and that for the 2020-21 year is $184.5bn.

Two immediate points. Is it so important to tell us that last year’s still only estimated deficit is $85.8bn, rather than a rounded-off $86bn or more honestly a range, of say, $83bn to $89bn?

Does Treasury — and by consequence the Treasurer taking ownership of the numbers — have even the slightest understanding of the fundamental dishonesty in presenting such a precise estimate for the 2020-21 year as the $184.5bn?

They might just as sensibly give us a forecast of the temperature — to a decimal point — for June 30, 2021.

In both cases — next year’s deficit and next year’s temperature — there is no way in the world that they could sensibly, honestly, argue the case for the exactitude.

While a more honest projection of the 2019-20 deficit would be that $83bn to $89bn range, the one for 2020-21 would be more like $170bn to $200bn; and even that would only validate a 95 per cent confidence level.

And, I need stress, this is not because of likely subsequent policy measures in the formal October budget; I’m talking about reality forecasts as of right now.

Now I understand, and you should too, that the deficit is just the bottom line of a whole series of spending and revenue figures. But that only serves to emphasise my point: the fault, dear Brutus, lies not in the — absence of — stars but of sub-ranges.

If you had more honest ranges for all the line items, you would end up with a more honest range for the bottom line deficit figure.

The second explanation — excuse — is that not having ranges is the way it has always been done. But that betrays not only the more long-established stupidity, shared by Treasury public servants and politician treasurers, but also a newer and far more disturbing stupidity.

On the first, the question again has to be posed: are skulls really that thick? Every year Treasury pumps out this budget exactitude both at the micro and the macro level and every year it is actively misleading and wrong.

They should long, long since have shifted to ranges that would engage honestly with the limits of their own competence, the limits of even the best prediction, and just simply being truthful in communication with the public.

The corporate world does this with profit forecasts, to honestly project to both shareholder and market.

Disdainful eyebrows

Oh dear, among the global elites in which both politician and bureaucrat mix, that would raise more than one or two disdainful eyebrows. “We” just don’t do it that way; we all pretend to exactitude; you’d be blacklisted if you shifted to honesty.

This is another flavour of why we need to disengage from the smothering plethora of internationalist so-called multilateralist bureaucracies.

They are an intellectual sewer, spreading diseased analysis, polluted policy, and fake solutions and certitude.

The second stupidity

But it is to the second stupidity, I really want to turn the emphasis. Those two decimal points announce a bureaucracy and a political leadership rooted in the past: a numbing inability to understand that this time it really is different; that, to borrow from Star Trek, we have undergone a seminal shift in the time-space continuum.

It’s not just the virus, although that and even more the almost total uniformity in the global response, has been the trigger; but the way seminal change has all been building, again not just through and after the GFC but pretty much from the mid-1990s, with this virus response dramatically expanding it.

We just simply cannot return to the world of February.

But on the more granular, important level, we shouldn’t want to anyway. That’s to say, the world of February had long since passed its use-by date.

Yet, the budget exactitude and comments continually emerging from both political and bureaucratic Canberra such as “looking through the cycle” join with the tired rhetoric of “tax reform” to demonstrate a complete inability to understand this.

That we just have to ride the “recovery” and life and prosperity will resume.

It reminds me of the story of long-serving watchmen at key points in the U-Bahn tunnels in April 1945, doggedly demanding fleeing Berliners show the appropriate passes before they would allow them to proceed.

As they had always done; that’s the way they had done it in the 1930s; that’s the way they had done it in the 1920s; showing no awareness that in April 1945 they were living in a “different’ reality.

You see it also in the ABS doggedly sticking to its definitions of employment (only one hour a week) and unemployment (actively looking for work) — despite the complete disconnect those definitions have to the reality of the unique government-mandated shutdowns.

A definition of course which surfaced in the Budget update and the prediction that the jobless rate would “peak” at “around” 9.25 per cent. Ah, a curious combination of “approximate exactitude”; but also just utterly false.

By any measure connected to reality, conventional-thinking economists argue a real jobless rate around 13-14 per cent; I’ve argued what could be called a “shutdown-policy real rate” closer to 20 per cent.

Complex reality? Understanding seminal shifts? Creatively crafting how to survive and prosper into it all?

That’s all too hard, even if it’s — unlikely — understood. We will just stick with the way we’ve always seen the world and done things, wrapped up in meaningless moronic exactitude.