Using pork barrelling to learn something about fiscal policy

In today's SMH, Peter Martin has a neat write-up of my Economics Letters paper with Christine Neill, which exploits Howard Government pork-barrelling to estimate the impact of fiscal stimulus on job creation. We find that the cost per job amounted to $10,000 to $31,000 over a three-year period.
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Next Community Forum

Just a reminder about my community forum tomorrow night. The main focus of the forum will be Labor's plan for a National Disability Insurance Scheme, but I'll also be happy to take questions on any other local or national topics, from tax to terrorism, roads to refugees, postboxes to polio.

Details, details...
Venue: Belconnen Community Services, Swanson Court
Time: Tuesday 25 October 6.00-7.30pm

I hope to see you there. And in the event you can't make it along, here's a complete list of my coming mobile offices and community forums.
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Open Australia Reopens

Due to a change in the way Hansard was formatted, Open Australia (main site, my page) has been out of action for several months. I'm pleased to say that this spunky interface for following parliament is now back online.
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Teacher Merit Pay

On Mon 14 Nov, 6-7pm, I'm giving a talk on 'The Economics and Politics of Teacher Merit Pay' at the Grattan Institute in Melbourne. Here's a summary:
The debate over merit pay can be summed up as follows: economists like it, voters love it, and teachers are divided. Can merit pay be made to work? Andrew Leigh MP will discuss these issues with John Daley, Grattan's CEO.

Looking across the international evidence, Andrew Leigh surveyed three sets of data that are relevant to answering this question: impact studies of teacher merit pay schemes, evidence on teacher attitudes to merit pay, and surveys of attitudes in the general public to merit pay. Looking at the existing merit pay plans, one is struck by the fact that they their incentive schemes are often very complicated, and most estimates are of short-run effects (so do not capture selection into the teaching profession).

Teacher attitudes are mixed, with new teachers more open to merit pay than their more experienced colleagues. US surveys find that voter support for merit pay is high and rising. I conclude with ten suggestions for future research on teacher merit pay.

To RSVP, click here.

(Incidentally,  Grattan is presently looking for a fellow to work in its cities program. If you liked Ed Glaeser's book, you should consider applying.)
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Positive Coaching

The New York Times has a great blog post on the new Positive Coaching Alliance. Some snippets:
youth sports has come to emulate the win-at-all-costs ethos of professional sports. While youth and professional sports look alike, adults often forget that they are fundamentally different enterprises. Professional sports is an entertainment business. Youth sports is supposed to be about education and human development. ...

As a father of an 8-year-old who has happily regained his love of soccer thanks to a very positive coach, I can attest to the value of its teachings. Research has found that youth attrition rates are 80 percent lower for children whose coaches practice positive coaching (pdf, p.11). ...

P.C.A. encourages parents to let go of winning and concentrate on life lessons. “There are only two groups of people whose job is to win games,” says Thompson. “Coaches and players. Parents have a much more important job: to guide their child’s character development.”

What works best is helping children understand that they control three key variables: their level of Effort, whether they Learn from experiences, and how they respond to Mistakes. ...

Because there are so many opportunities to fail in sports, it is a gold mine of teachable moments. “If a child misses a big play, it’s a perfect opportunity to talk about resiliency,” explains Thompson. “‘I know you’re disappointed and I feel bad for you, but the question is what are you going to do now? Are you going to hang your head? Or are you going to bounce back with renewed determination?’” ...

One technique, adopted by many, is teaching players to “flush” their mistakes. Using a hand gesture that mimics flushing a toilet, a coach can signal from the sideline and players can signal to each other. “So the kid looks at the coach and the coach goes: ‘Flush it.’ The teammates are saying: ‘Hey, Flush it, we’ll get it back.’ “The single most important thing we do is help coaches teach kids not to be afraid to make mistakes,” he adds. ...

The key is not to withhold criticism, but to deliver it in a way that is helpful. If the child is angry or sulking or defensive, she’s not going to be listening very well anyway. “When you ask people to focus on mastery, it’s not soft,” notes Thompson. “And screaming at a kid is not tough. That’s just a lack of impulse control.”
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Community Organisations

Two local organisations - Al-Anon and the ACT branch of the National Servicemen’s Association - have asked me to let people know a bit more about them. Details over the fold.

There’s no silver bullet for ending addiction. One of the most iconic programs – AA’s Twelve Steps - works for around 10 percent of individuals with addiction problems. There’s a temptation is to say that it ‘only works for around 10 percent’, but any program that works at all is not to be disparaged (perhaps for that 10 percent AA is the perfect fit). AA has its detractors, but dealing with addiction is not a one-size fits all proposition.

Perhaps AA’s success rate would be higher if the role of its sister organization, Al-Anon, was more widely recognised. Al-Anon was founded by Lois Wilson, who was married to Bill, one of the co-founders of AA. Bill Wilson was an alcoholic who found a way to beat his addiction through mutual aid and a working knowledge of the ‘science’ of addiction. The religious experience that accompanied Bill’s detox certainly didn’t hurt either, and AA does place emphasis on surrender to ‘something higher’, but that something higher needn’t be spiritual, it might just as easily be a stable family or the future of one’s children.

Which brings me back to Al-Anon and Alateen. Lois Wilson was ideally placed to understand how an addict’s behavior could send shockwaves through the lives of his or her family and friends. Lois saw how behavioral patterns of an addictive personality could develop from and reinforce complex co-dependent dynamics within a family or a group of friends. She saw the benefits that could come out of providing the families of alcoholics with the same kind of mutual aid and support offered by AA.

Ideally the programs are coupled. The majority of participants in Al-Anon meetings are the spouses of individuals attending AA. Statistics seem to suggest that problem drinkers are more likely to recover if their partner or a member of their family is attending Al-Anon meetings. Just as importantly, though, a partner or family member attending Al-Anon is likely to be happier, both during and after the program, than one who isn’t.

Al-anon is open to all family members and friends of alcoholics. Alteen operates on the same principles but is geared to the needs of the children of alcoholics.

You can find out more about the principles of the organization, how meetings work, and what sorts of things are discussed at Al-Anon’s website. If you think an Al-anon meeting could help you, check the website.

ACT branch of the National Servicemen’s Association

Were you in National Service? The ACT branch of the National Servicemen’s Association would love to hear from you. The ACT Branch was formally incorporated in 2010 so that the National Association would have a voice in the nation’s capital.

The membership of the National Servicemen’s Association continues to grow, as more ex-National Service personnel discover the organisation and take up the opportunity to form friendships with like-minded contemporaries. The Nashos conduct many military and social events, and try to cater for the interests of both members and their partners.

If you’d like to learn more about the organisation or if you’d like to become one of the Nashos in Canberra, visit their website or email nashos <AT> 
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In case you’ve ever wondered what an MP’s inbox looks like, here are two messages (which arrived within seconds of one another), that neatly bookend the 200-odd emails I get in a typical day.

In response to my position on climate change:
You are an absolute fool & a joke, the science has only been settled by the rogues that the Government bought off to say the right things, IT IS A HOAX & a dirty rotten TAX, you IMBERSILE, I honestly don’t know how you & all your other oxygen thief’s sleep at night.

The lot of you are GRUBS.

In response to my position on same-sex marriage:
I have an incredible amount of respect for you Andrew.

Thank you so much, you are a wonderful person.
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Mapping the Northside launched today

[caption id="attachment_1707" align="alignleft" width="461" caption="Me with Hannah Semler (left), Director of the Belconnen Arts Centre and professional artist Maryann Mussared. As you can see, the map is enormous. "][/caption]

Today I officially launched the 'Mapping the Northside' project along with Hannah Semler from the Belconnen Arts Centre.

Mapping the Northside is an exciting project where I've joined forces with the Belconnen Arts Centre to help people learn about more great places in our region.

An enormous map (3m x 2m) will be displayed in the Belconnen Arts Centre from today until Thursday 17 November upon which you can locate your favourite places in the Federal Division of Fraser - the northside of Canberra. This is your opportunity to tell everyone about your special, important places and environments and let your imagination run wild - you can include any kind of creative response, such as a drawing, photograph, story, poem or even performance work.

There will be three facilitated information sessions at Belconnen Arts Centre (Saturday 29 October 11 – 1pm), Gorman House Arts Centre (Saturday 5 November 11 – 1pm) and Gungahlin Library (Saturday 12 November 11 – 1pm), where professional artist Maryann Mussared will be available to help guide the creative process.

I encourage everyone to call into the Belconnen Arts Centre, see the big map and have a think about your favourite place on the northside. You can also suggest a favourite place to [email protected] or [email protected].

More information is available from the Belconnen Arts Centre (  or 6173 3300), or my office on 6247 4396

Many thanks go to both the Gungahlin Library and the Gorman House Arts Centre for their support on this exciting project.
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The Social Impact of the US Recession

My AFR column today summarises a handful of fascinating new papers on the US slump.
US Recession Hits Home, Australian Financial Review, 18 October 2011

Empirical economists are a perky bunch. Give us a badly-designed policy, a natural disaster or an economic calamity, and we’ll use it to learn something about human behaviour.

And so it is with the latest recession in the US. While Tea Party Republicans force America to repeat the policy mistakes that prolonged the Great Depression of the 1930s, a spate of fascinating new research papers have analysed the current slump.

Some have set about documenting the human impact of the crisis. Michael Hurd and Susann Rohwedder argue that what made this latest crisis so severe was the simultaneous shock to the sharemarket, housing market and labour market. They point out that the impact of the 1981-82 and 2001 recessions was muted by the fact that house prices still rose.

For Americans, the 2008-09 recession brought a triple-whammy. The US sharemarket almost halved in value at its worst point. Average house prices fell by more than a tenth (more than a third in California and Florida). Unemployment doubled to over 10 percent (it is now 9 percent).

The impact was particularly felt by men, who accounted for 71 percent of the job losses. This had the effect of speeding up a long trend towards the feminisation of the labour market. In late-2009, there were equal numbers of men and women in the US labour market (most likely for the first time in history). Wags call this the ‘mancession’.

But regardless of demographics, the US recession has spread its tentacles across society. Thirty-nine percent of households experienced unemployment, had negative equity in their house, or were in arrears in their house payments. Real median household income in 2010 was 6 percent lower than it had been before the crisis.

The wounds will take a long time to mend. Rajashri Chakrabarti and colleagues at the New York Federal Reserve find that a fifth of Americans withdrew money from shares when the market bottomed out, locking in their losses. And in an exhibition of Keynes’ ‘paradox of thrift’, US households are now focused on paying down mortgage debt, hampering the prospect of a consumer-led recovery.

One result of a ghastly labour market is that the average American is working 2 hours less per week than before the recession. With time use surveys, Mark Aguiar and coauthors ask the question: what did Americans do with the additional hours? They find that about one-third of the time went to household chores. More than half has gone to leisure activities, such as socialising, reading and watching television.

If you’re looking for an upside to the downturn, it’s that recessions are on average good for population health. For example, the share of Americans reporting poor health or trouble sleeping has fallen during the recession. With shorter hours and fewer jobs to go around, it’s not surprising that work-related illness has declined.

But for those handing over their house keys, it’s a different story. Combining postcode-level data on foreclosures and hospital visits, Janet Currie and Erdal Tekin show that in places where more homes are repossessed, there is a spike in suicide attempts and admissions for anxiety-related conditions such as hypertension. Given that 1 in 45 US homes received a foreclosure filing in 2010, this suggests that the housing crisis is one of the nastiest communicable diseases to hit America in a long time.

What impact has the crisis had on the attitudes of Americans? In a short paper, Betsey Stevenson and Justin Wolfers show that trust in politicians tracks the business cycle. Not surprisingly, then, a Gallup survey that has been running since 1972 shows voters’ confidence in the US Congress at an all-time low. Americans have never loved their legislators, but now they loathe them.

Finally, Angus Deaton regards the financial crisis as a chance to ‘stress test’ the idea of happiness as a measure of wellbeing. Since 2008, Gallup has been polling 1000 Americans daily. Deaton finds that happiness responds more to the state of the sharemarket than to fundamental measures such as income and unemployment. From this, he concludes that happiness is too sensitive to ‘short term ephemera’, and serves as a poor proxy for the state of the aggregate economy.

If there’s a silver lining out of the US recession, it’s that it’s raised plenty of interesting questions for academics to answer. Many economists would prefer a second fiscal stimulus package; but for now, the research findings will have to be our solace.

Andrew Leigh is the federal member for Fraser.
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Local teachers recognised at national awards

Gai Brodtmann and I congratulated some outstanding local teachers over the weekend.
Teachers and principals from the ACT have been recognised at the 2011 Australian Awards for Outstanding Teaching and School Leadership for their hard work and dedication.

Member for Fraser, Andrew Leigh, and Member for Canberra, Gai Brodtmann, today congratulated five exceptional local teachers who received recognition as territory finalists at a ceremony in Melbourne.

“These finalists have made an outstanding contribution to our community by demonstrating innovation in their teaching practices and providing a positive schooling experience for local students,” Gai Brodtmann said.

“There are few jobs more important than teaching young Australians. Awards such as these help to raise the status of teachers who are delivering high-quality education for young Australians,” Andrew Leigh said.

Minister for School Education Peter Garrett presented the national winners with their awards at an event hosted by the Australian Institute for Teaching and School Leadership on Thursday 13 October 2011.

Certificates were presented to 39 state and territory finalists, from which the Minister’s

Award and four national winners were selected in the following categories:

  • Australian Primary Teacher of the Year

  • Australian Secondary Teacher of the Year

  • Australian Primary Principal of the Year

  • Australian Secondary Principal of the Year

  • Minister’s Award for Excellence in Teaching or Leadership in Aboriginal and Torres Strait Islander Education

Winners of the national award will receive a professional learning scholarship to work with recognised education experts and practitioners within Australia or overseas.

A full list of finalists in the Australian Awards for Outstanding Teaching and School Leadership is available at:

ACT finalists:

Category Nominee School
Primary Principal Liz Wallace Isabella Plains Early Childhood School
Secondary Principal Michael Lee St Mary MacKillop College, Canberra
Minister’s Award Lyle Swan Telopea Park School
Primary Teacher Glynis Steward Florey Primary School
Secondary Teacher Caitlin Hanby University of Canberra Senior Secondary College

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Cnr Gungahlin Pl and Efkarpidis Street, Gungahlin ACT 2912 | 02 6247 4396 | [email protected] | Authorised by A. Leigh MP, Australian Labor Party (ACT Branch), Canberra.