Most days I find myself nodding in agreement when reading Judith Sloan’s op-eds. Some days I find myself nodding in agreement when reading Peter van Onselen’s op-eds. Rarely, if ever, have I found myself agreeing with both on the same. Today is one such day.
Judith takes a big stick to the Productivity Commission:
The Productivity Commission immodestly calls its first five-yearly review of productivity Shifting the Dial, released this week and commissioned by Scott Morrison. I have another title for it: Shifting the Dial Backwards.
Take it from me, it’s 1200 pages of bureaucratic sludge. But amazingly, its most radical ideas — replacing stamp duty with land tax; turning pharmacies into automatic dispensing outlets (with a TAFE-qualified staff member in charge); transforming universities into schools; imposing a national carbon price and road-user charges — are rationalised in the space of a few paragraphs, often with reference to other institutions, particularly the Grattan Institute.
Judith is on fire and it gets better as she warms up to the task. The bottom line:
If there is one ominous theme that pervades the Shifting the Dial (Backwards) report, it is that more data will solve pretty much everything. More data is what central planners always want. With more data, those mistakes that politicians and bureaucrats routinely make can be eliminated.
And with more data, including in the hands of consumers, everything will be better. Don’t worry about privacy breaches, about self-serving analyses, about big brother watching over you. Forget principles, forget markets, forget the limitations of governments and bureaucrats — data will solve everything.
No one will deny that, along with most developed economies, we have a productivity challenge. And it would be great to have more efficient and effective health and education systems. But to think that even more detailed bureaucratic interference, piecemeal changes to taxes or getting rid of pharmacists are the solution is to be profoundly mistaken.
In a separate piece PvO identifies the problem – and, to my mind, fingers the productivity challenge facing developed economies, including Australia.
Universities prioritise research over teaching because they are incentivised to do so, by governments no less — indeed, in particular by the federal government, of which Morrison is a senior figure.
In other words, he and his cabinet colleagues are responsible for the system that rewards a focus on research over and above teaching in Australian universities.
No one in government should need a report to inform them of the effect of their own policy decisions. If Morrison thinks it’s a problem, change the policy. If he’s looking for someone to blame, find a mirror.
Let me repeat the money quote:
No one in government should need a report to inform them of the effect of their own policy decisions.
Indeed. Yet here we are. It’s probably worse than that. I suspect many people in Canberra have absolutely no idea that many of the perverse outcomes that we observe are precisely due to the design of the policies that they have dreamt up. The instinctive solution is more government intervention. Perhaps they should try doing less.