Having gone to considerable lengths in lobbying for one of our very own, former finance minister Mathias Cormann, to become Secretary-General of the Paris based OECD, the Government — at least the international set – would be very pleased with itself.
Unfortunately, the OECD has long outlived its former fervour for economic rationalism: balanced budgets, low tariffs, and small government that leaves competitive free markets to be the essential supply force (with agriculture always an exception given the protectionism of its key European membership).
In more recent times it has focussed on decarbonisation, assisting the poor, gender issues (there is an OECD “gender portal” and scoldings about how progress-on-gender-equality-is-too-slow). The OECD is also – probably always was – a proponent of Keynesian stimulus. As a result, it usually has an unwarranted faith in fiscal stimulus in bringing about faster growth and tends to miss the damage done by government spending — especially that which supposedly favours the poor. It totally missed the excessive lending to those with no collateral that caused the US economy to implode in 2007 triggering the global Great Recession of 2008.
The outgoing Secretary-General is the Mexican socialist José Ángel Gurría.
Cormann seemed an unlikely successful candidate. Though ticking the boxes in linguistic skills, this was no different from other candidates.
Australia’s former finance minister was up against several female candidates at a time when all the pressures favour women being appointed as leaders in what are often seen as male bastions. The favourite was Cecilia Malmström, a politician from the small centre-right Swedish Liberal Party. She is an advocate for children and combating terrorism through “preventive measures, rather than through confrontation”. Beyond Swedish politics, she has a distinguished diplomatic career and was the former European Commissioner for Trade.
Cormann, as a Liberal, is ostensibly fiscally conservative, normally the key credential for a Finance Minister. Peter Walsh (1984-90) was Australia’s outstanding finance minister, holding back the innate spending excesses of the Hawke government but Penny Wong (2010-13) also did a reasonable job in the Gillard-Rudd administration. Among Liberals, Nick Minchin can claim credit in paring back the size of Commonwealth spending from the 25 per cent of GDP which he inherited to 23 per cent.
Cormann can make no such claims. Even prior to the COVID spendathon, he proved unable to reduce the size of government which was 24.4 per cent in his first year (2014) and 24.5 per cent in 2019. He was unable to build on the fat-cutting progress that Penny Wong set in train.
Perhaps he is just too nice a guy.
If not, he demonstrated oceans of adaptability in pursuing the top job in Paris. His acceptance statement talked of “a big job to be done to help drive stronger, cleaner, fairer, more inclusive growth.” Cleaner, fairer and more inclusive is the trifecta essential to win the EU and US/Canada vote in the modern woke era.
Hopefully, Cormann in his statement was just turning on the marketing charm. But probably not in view of his mundane record in holding back his fellow politicians’ predisposition to see themselves as the best spenders of their constituents hard-earned.
Like most bureaucracies, the OECD has a culture with established fiefdoms and ideologies. Its Secretary-Generals have become figureheads. The organisation would appear to have little to fear from Cormann breaking the mould by pushing back on its policies favouring carbon taxes, feministas and other goals deemed worthy by the elites.
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