Did someone mention a deficit?

The Opposition’s accidental new best friend, Chris Richardson, economist of Deloitte Access Economics has suggested that a budget surplus may not be such a wise idea given that Europe’s economic outook is somewhat fragile, though not entirely horrific.  The suggestion did not come with any criticism of Wayne Swan, in fact, the contrary.

Access said it did not expect a disaster in Europe, but if there was one the  government should be prepared to spend to stimulate the economy as it did during  the global financial crisis. “For all the unpopularity of the stimulus spending,  it did its job very well. Please don’t let populism derail a new stimulus if we  need it.”

This followed his earlier point that:

. . . the economy has already weakened and events in Europe hold out the prospect of it weakening further. I don’t think that tightening into that fragility would help the economy.

In other words, interpret it as this: forget about the suplus.

The Opposition interprets things a little different (with a large dose of derailing populism).  This proves beyond doubt that this Government has no intention of ever returning to a surplus.  Let’s hear what Joe has to say.

“Labor can’t deliver surpluses, it’s not in their DNA,” he told ABC Radio,  pointing out the last surplus delivered by a Labor government was in  1989/90.
“Whilst they lecture the rest of the world about fiscal  austerity, they fail to undertake it themselves,” he said.

I don’t think that’s what Chris Richardson was suggesting, but it’s easy to see the Opposition’s reasoning.  Europe is in trouble, stimulous spending at home is not to be ruled out according to an independent source, therefore Labor is bad.

With Wayne Swan being equally as adamant that there won’t be a deficit as Joe Hockey is in his huffing and puffing that there will be, I like what Richardson had to say about the politics of the issue.

Mr and Mrs Suburbs think a dollar in surplus means you’re a genius, and a dollar in deficit  means you’re a dunce. Politicians of both sides have played to that. They should  back off.

And that’s what we’ve been drip fed.  A surplus is good, a deficit is evil.

One of our contributors, Mangrove Jack commented on our recent Tax Forum thread that:

  • a deficit is a totally imaginary boogey man that neo-liberal economics uses to frighten people.  It wasn’t all that hard to do as we’ve been culturally primed to shiver at the very word.  But at the end of the day it’s just a number. If the government chooses to issue “debt” in the form of bonds to equal the deficit, fine, that’s just an asset swap for the private sector, and the stream of dividends further stimulus, but operationally, it doesn’t have to.  But everywhere we have conservative governments pushing this surplus nonsense.  They seem determined to push their economies to the edge of the 1930′s precipice.
  • when the economy has spare capacity . . . it is absolutely essential for the government to keep injecting money into the economy to keep the ship afloat.

Following the ‘reassuring’ announcements from all sides of politics today, I think Mangrove Jack offers a bit of sanity to the topic.  Chris Richardson would agree.  How do you see it?



111 comments on “Did someone mention a deficit?

  1. A timely post Min.

    “Mr. and Mrs. Suburbs” are being sold a great big lie over the debt and deficit mantra which the Coalition has been hammering for years.

    The Rudd Labor government went into deficit to fund the stimulus package during the GFC, and apart from the Coalition and their supporters it was received with some praise. It also kept our ship afloat when others sank.

    Had that not happened many thousands of Australians would have been on the unemployment queue, and receiving financial assistance from government revenue, which would have eaten into the precious surplus while businesses were bankrupted for the lack of paying customers.

    Any government worth it’s salt knows when to give the economy a boost and when to step back, and so far this government has done that.

    Press Release – Tax from more jobs lowers debt by $16 billion

    A Lateral Economics study released today shows that over a quarter of the debt from the fiscal stimulus will be repaid from the taxes of those who would otherwise have been unemployed.

    “As our economy turned down in late 2008, Australians’ spending kept other Australians in work. And those kept in work repaid the favour – by continuing to pay their taxes.” said Nicholas Gruen, CEO of Lateral Economics.

    “So for every dollar the government spent, tax revenue to Australia’s governments rose by around 22.5 cents, leaving just 77.5 cents to be repaid. The total windfall to the budget – and to the community – of the additional tax revenue from the cash transfers is around $6.7 billion. This money and the production of all those people and all that capital kept in employment are the riches of good economic management – the only kind of free lunch we know of.

  2. Pip, Neil talks about the deficit on every thread. It’s only logical that he’d grace this one with his vast reservoir of knowledge.

  3. The Government is in for a hammering either way. Spend money – create jobs – continue with the deficit. Spend nothing – do nothing – go into recession like the rest of the world if another GFC hits. But at least we’ll have a surplus and Neil, Tony and Joe will be happy. Though they’ll still blame Swan for the economic downturn.

  4. Umm, exactly how did Sloppy spin this report from Chris Richardson into “the government will never deliver a surplus”? Has poor old Sloppy’s brain, or what passes for a brain, been fried by Qantas?

    In fact Richardson recommends more stimulus spending if things go seriously pear shaped globally again and forget about a bloody surplus! I recommend that Sloppy does Grade 3 reading comprehension again.

    I agree with Roswell, a timely post, although I’m not so certain about the Neil part. 🙂

  5. Min, you beat me to it. I was trying to create a post that Neil would like.

    Thanks, I do not have to do it now.

    I have had this horrible though, why the conservatives love surpluses.

    It fits in with their hatred of welfare, government services and user pay mentality.

    I believe that maybe Mr. Swan can make cuts to middle to upper income welfare and transferring some of the tax burden from those at the bottom, to those at the top.

    It would fit in with wanting a unnecessary surpluses. Mr. Swan could do in reverse what Mr. Howard spent over a decade doing. Transferring the wealth from the employees to the employers.

    As long as he only touches middle and upper earners welfare and transfers some of the tax burdens to the wealthy, the economy will not suffer.

    Every cloud has an silver lining, so they say.

    “….Want a budget surplus? Looking for billions in savings? Easy. Tax the rich. Cut their subsidies.

    The tax system is a disguised spending program, worth, according to Treasury, $113 billion last year. This is equivalent to 30 percent of all Federal Government spending and receives no attention when the Labor and Liberal neoliberals talk about cutting spending.

    Attacking the $113 billion in annual tax expenditures – the tax lurks where income isn’t taxed or where extra tax deductions are given – could focus on the largesse to business and raise many tens of billions. Cutting capital gains tax concessions to business alone would raise up to $10 billion.

    A wealth tax, gift and inheritance taxes, taxing the profit on the sale of the homes of the super rich – these too could raise billions from the big end of town. Not to mention raising income tax rates on the rich and big business and reducing dividend imputation.

    What about abolishing the fossil fuel subsidies to business? An extra $10 billion there.

    Now all of these would have consequences. Business would try to raise prices and/or sack staff….”

    …….. Treasury estimates are that direct spending through the tax system on business totals about $8 billion. On top of that the capital gains tax concessions give billions each year to business and the rich.

    And the superannuation concessions, which overwhelmingly favour the rich, are actually a disguised spending program worth more than the pension.

    Why doesn’t Labor tax big business and stop spending tens of billions on the rich through the tax system. Labor?

    So here we have a Government and Opposition intending to attack the poor and ordinary workers to save a few billion when a few simple tax measures – like taxing the family homes of the rich, and abolishing the superannuation tax lurks for the millionaires, and getting rid of the tax concessions for capital gains – would raise tens of billions. …..”


    There are many options. Maybe Mr. Abbott needs to be careful what he asks for.

  6. This is the story of the day that is getting little coverage. It was dropped by Mr. Abbott this morning.

    ‘………..The Federal Government and Opposition are embroiled in a bidding war on international trade, with leaders from both sides at odds over Australia’s anti-dumping regime.

    Manufacturers of paper, glass, food and steel say they are being hurt by heavily subsidised cheap imports sold in Australia….”

    The Federal Government and Opposition are embroiled in a bidding war on international trade, with leaders from both sides at odds over Australia’s anti-dumping regime.'”


    I do hope that Mr. Abbott apologize to the British Chancellor, for allowing his shadow treasurer from misquoting him in our Parliament.

    Mr. Hockey as is their habit took one sentence out of a two sentence paragraph, to convey a diiferent meaning to what the Chancelor had said.

  7. Drum has discusion on this topic tonight on ABC 24

    Would recommend watching repeat or online.

    They also touch on push polling and animal farm economics of Mr. Costello.

  8. My dear local Channel 9 coming down firmly on Tony’s side, thoughtfully providing a montage of quotes from Gillard & Swan promising surplus (no shots of Tony saying he’d do it quicker) plus the information that Labor hadn’t delivered a surplus in whatever years. Gave us a shot of Blarnaby too, saying something about scales. You know you’re in for some seriously heavy bullshit populism when they trot him out. Abbott’ll be hoping for a clear run, being allowed to focus on Labor’s previous statements without being quizzed on his own.

  9. Once again, take the time to watch the Drum. One has to put up with Tim Wilson, but they are using him like we do Neil.

    Stephen Long is good value.

  10. Mr. Swan has used the MRRT and the Clean Energy Bull to introduce some tax reform. Seriously, this might be another opportunity.

  11. The problem is that our big miners are mainly foreign owned.

    “….Mr Debelle said the big recent change in the current account was the shift from trade deficits to trade surpluses as high commodity prices boosted returns from resource exports.

    But that had also affected the size of the net income deficit, he noted. “Because a sizeable share of Australia’s resource sector is foreign owned, the increased income of that sector partly leaks into a higher payment to the foreign owners, either in the form of dividend payments or retained earnings, thereby increasing the net income deficit,” Mr Debelle said.

    The scale of the outflows has begun to attract political attention, with the Greens recently calling for an increase in the rate of the government’s planned mining tax to claw back resource profits for Australians…..


  12. Sue at 11.49
    Looked around a bit, on the Oz’ website an article by the wondrous Matthew Franklin immediately turning poll results into leadership speculation. God they’re horrible, especially him, I think. How do you think tomorrow’s weather will affect the leadership challenge? It’s meant to be raining here, what bearing does that have?

  13. Cu, from your link


    But Mr Debelle said current account deficits were “not always and everywhere a bad thing”.

    “There can be perfectly good reasons why current account balances are not zero, and indeed can even be quite sizeable, without them constituting imbalances or being a cause for concern,” he said.

    “The accompanying capital flows are often beneficial”.

  14. Cu, also from your link, and very important considering all the blather from the Opposition.

    Yet the current account deficit, while narrower than previously, was still 2.5 per cent of gross domestic product.

    2.5% of GDP is tiny.

  15. There is an abundance of quality opinion on the MSM the last few days. What has happen to make this so.

    “Abbott leaves trail of fumes as Senate finalises carbon tax ”

    Read more: http://www.brisbanetimes.com.au/national/abbott-leaves-trail-of-fumes-as-senate-finalises-carbon-tax-20111107-1n3yt.html#ixzz1d1lF8JHe

    “The only other amendment moved by the Coalition was for the implementation of the bills to be delayed until after the next election”

    Read more: http://www.brisbanetimes.com.au/national/abbott-leaves-trail-of-fumes-as-senate-finalises-carbon-tax-20111107-1n3yt.html#ixzz1d1mXjpbA

    Is the problem laziness or are they as the body language suggests, given up.

  16. BSA Bob,

    did you notice the reference to Tony Abbott’s alleged constant negativity ?

    Not alleged, it’s been evident for a long time.

  17. Cu,
    it looks as if someone has let the dogs off the leash and they’re all barking.

    Maybe there’s a leadership rumble coming up 🙂

  18. Even Chris Uhlman said it looks like things are turning the PM’s way. I have not heard one word of suuport for Mr. Abbott. I believe Ch 9 did.

    It is more than a rumble, more like a roar.

    Too many ego’s in the Liberal Party, especially among the young brigade.

    All very nasty..

  19. Pip, I have thought this for weeks.

    It is not what has been said, but what is not being said.

    Mr. Abbott has been seen more on his own.

    Body language of many indictate something is wrong.

    They have an air of desperation and shambles.

  20. Cu….back-tracking….connect the dots 🙂
    there’s Ch.9


    The federal opposition has accused Prime Minister Julia Gillard of betraying workers in her own electorate as the Senate prepares for a vote on the government’s carbon tax.

    The tax is being blamed for the possible closure of a methanol factory
    [Coogee Chemicals] in Laverton, Victoria, and the shelving of plans for a $1 billion plant that would have provided 150 jobs elsewhere in regional Australia

    and the Opposition says [Greg Hunt]

    “Jobs will go to China, investment is lost and the emissions of CO2 will go up because China uses coal rather than LNG for methanol production.”

    **Govt assures company about carbon tax

    On the eve of a historic carbon tax vote in the Senate, the federal government has rejected claims the scheme has caused a Melbourne methanol producer to shelve expansion plans.

    Labor says Coogee Chemicals, based in Prime Minister Julia Gillard’s outer Melbourne electorate, will be no worse off under its carbon package, which will provide compensation to business and consumers


  21. Cu, of the young brigade watch Josh Frydenberg if there are any changes to the opposition front bench.

    He speaks like the parrots from the IPA.

  22. Cu,
    as we’re on the ‘Did someone mention the deficit” post, have you noticed the ‘debt and deficit’ has been given a rest recently or have I missed it ?

  23. Pip @12.35am, I wonder why Sloppy hasn’t had anything to say about Debelle’s remarks? I’m surprised that that opposition financial whiz kid is strangely silent. He could at least denounce Mr Debelle. 🙂

    CU @12.54pm, they’re still having a bit of a bat as per Senate QT, but they’re a bit half hearted, I think.

    BTW, i really enjoyed Jessica Rudd’s put down of the clown who just had to bring up the leadership challenge meme on QandA tonight. I was equally surprised at Ray Martin’s comments. He was just what we’d come to expect of ABC reporters of old. Fair and balanced.

    Pip @1.35am, Wong put them squarely in their box on that bullshit. You could clearly see that she thinks they’re dickheads. That lady takes no prisoners.

    Should we expect the imminent arrival of Neil Debt and Deficit of Sydney?

  24. Jane, I can’t believe I forgot all about Q+A.

    I heard Cash or was it Nash screeching in the Senate, and Simon Birmingham doing his best..but Penny Wong runs rings around the lot of them

    Neil debt and deficit of Sydney …just another trout mouth :mrgreen:

    He should stay in Sydney ! or further east !

  25. Another brain explosion from Tony Abbott:-

    Leaders lock horns over anti-dumping regime

    The Federal Government and Opposition are embroiled in a bidding war on international trade, with leaders from both sides at odds over Australia’s anti-dumping regime.

    But Trade Minister Craig Emerson says Mr Abbott “is wrong and he knows he’s wrong”.

    He insists Mr Abbott’s plan would violate Australia’s international trade obligations and risk hurting the people the Opposition Leader says he wants to protect.

    “We would have innocent working Australians caught in the crossfire as Mr Abbott just wrecks our position with the World Trade Organisation and invites retaliation. It’s totally irresponsible,” he said.

  26. Senator Wong is a good performer The shit that she takes is unbelievable. She does not deserve what is dished out to her.

    I believe Jessica when she said her father is happy. Most know it does not work to go back. I am sure Rudd has other worlds to conquer.

    As for Coogee, it has be he had assisted the firm instead of making political capital out of it.

    I think we seen a little of the old Ray Martin, he has been missing for a long time.

    I did not think Turnbull performed that well

    The show was unbalance. Only Turnbull and Reith seem to get a go.
    What is clear, Abbott is not liked.

  27. Cu, I’m sorry i missed Q+A, what was I thinking ?

    Nikki Savva is still writing about the next Labor leader and tipping Shorten…
    “but not yet”.

    Kevin Rudd has moved on and is doing a job he loves, and maybe he wants the leadership again but I wouldn’t be placing my money on such a bet.
    It doesn’t matter how many times he is asked by the silly journalists, or what he says, they write more crap.

    Reith and Turnbull are both in the news very regularly, and both have a burning ambition. I don’t think Reith has ever given up on Workchoices, whatever he calls it, and Turnbull can see the writing on the wall for Abbott and makes almost daily pronouncements to up his profile.

    Penny Wong must have a lot of patience to put up with the bumptious, pompous opposition she faces every day.

  28. Cu, thanks for the link.

    Dumping is a form of price differentiation between markets. It is not a prohibited practice under international trade agreements. However, remedial action may be taken where dumping causes (or threatens to cause) material injury to an Australian industry.

    I would prefer Dr. Emerson to handle any international ructions than for Tony Abbott to deal with it like a bull at a gate !

  29. Neil is too busy on Open thread. This was set up for him. Min beat me to it.

    I think he will stay away from this site, mainly because he does not understand much of what been written.

    I was working on something along the same line.

    I really believe Abbott is gone. I thought he might see the year out.

    All the media had to do all along was ask him some questions. Any questions.

    We have had the Clean Energy Bill gone through, or nearly through with one useless attempt at amendment.

    It is ridiculous.

    As Martin said it is OK to oppose but one does expect to hear some ideas from them.

    The PM is capable of adopting amendments, if they are better.

    I do not believe that Qantas was popular tonight either.

  30. The trouble is we do not have what Abbott is proposing.

    Maybe it is on the Menzies site. They hosted the meeting today. Being the work of Mirabella, I bet it is good.

  31. I would be susrprised if there was a challenge. Even if there is a small number with time on their hands, the most votes thay can muster is I think 15. Out of 104. Long way to go.

    The PM is handling the job well. If the put someone else in, the undermining would begin again.

    It does not make sense.

    There are too many experience, with cool heads in Labor.

    Ineed to go to bed, up to early zfter going to bed too late.

  32. Apologies if we have had this one already..in fact I’m certain that I read it yesterday but is seems that The Age has put it up again today.

    As Access’s Chris Richardson says, failure to produce a surplus next year is only politically horrendous, not economically. This was a line in the sand drawn by politicians, not by economists.

    Further out, there are bigger worries if the likely events come to pass and Abbott is elected prime minister and Hockey becomes his treasurer.

    Hockey’s apologists claim he just has to run with the policies Abbott invents, but that excuse is wearing very thin. Hockeynomics looks like a dangerous cult – a world in which Canberra increases services but cuts taxes while building up a massive surplus. No, it does not add up.


  33. There never was a challenge, there never was going to be. It is another ‘leak’ manufactured by either the opposition or the papers to divert attention. It didn’t work. I think the people are fed up with this navel gazing, which is why the Government is finally getting traction. They are the only ones with their sites lifted up and forward.

    As to the leaks. It will be interesting to see the results of the police investigation into the leaks about the tender process for the rights to the Australia Network. Gretch anyone?

    As to the surplus, there is not much the Governmnet can do. They have tied themselves to this return to surplus. Even from Access Economics outlook, a surplus can still be achieved ‘relatively’ painlessley. The Government had just better hope Greece sorts itself out, and no other hiccup develops.

    At the same time, hockey has tied himself to that mast too. IF they do return a surplus, his already crumpled reputation will be well and truly shot. It’s almost worth it just for that imo.

  34. Also, the issue of having to tighten one’s belt..given that the court of public opinion rules that a surplus ‘must be done’, this could be just the opportunity that Swan needs to undertake some long overdue reforms.

    The hint comes from…

    Government sources say ministers have already been summoned to appear before the razor gang but no decisions had been made yet about where to cut.

    They say a top priority will be protecting low and middle-income earners from the pain. That leaves the way open for tighter income means tests on welfare for higher income earners.

  35. Is it just me, or is it strange that the opposition FINALLY come under scrutiny AFTER the polls have reversed?

    They talk about poll driven politics. Are we witnessing poll driven journalism?

  36. Yet more scrutiny and again from the Murdoch media.

    I caught a snippet on Sky this morning that Robb was not at all impressed with Abbott keeping him out of the loop in budget discussions pertaining to the carbon tax. Has the Murdoch media decided on a changing of the guard..is it Turnbull leader/Robb treasurer??

    For Opposition Leader Tony Abbott and shadow treasurer Joe Hockey to seek to make cheap political capital out of Australia’s international obligations in this instance is simply extraordinary.

    According to Abbott, “the risk is that the Australian taxpayer will end up contributing another $5 billion to the IMF so that Greeks can continue to retire at 50”.

    Wrong. Australia is not – and has never proposed – contributing to the European Financial Stability Fund (the eurozone’s bail-out mechanism).


  37. Tom R @7.54

    Godwin Grech the public servant disgrace. Abetz/Turnbull got off lightly on that one. And Grech went into hiding when the proverbial sh!t hit the fan.

    In came he feds, what else did they find at the time.

    Now we have Turnbull once again with all his bluster saying “This whole sorry process is too important to be just pushed aside”….sounds a bit too familiar to me and the feds are back in again
    “The Australian Federal Police is investigating the leaks. It is focusing on a story written by Mark Day and published in The Australian ”

    or so the oo suggests or hopes

  38. CU,

    Your linking to speech by Guy Debelle was a curious digression (I wonder what you were looking for to come across that little gem !).

    I remembered reading the RBA transcript at the time, recalling especially his concluding remarks:

    “So in conclusion, I am reminded of some sage advice from Hamlet: ‘there is nothing either good or bad, but thinking makes it so’ ”

    He was of course referring to current account deficits, but his observation is equally valid for budget deficits.

    But the current account position is interesting in this discussion, because when it’s in deficit (the historical situation for our economy) a budget surplus must (by definition) be balanced by a private sector deficit. Households have to spend more than they earn to maintain their standard of living.

    Prof Bill Mitchell explains all this with some simple algebra on his blog.

    Whilst I welcome Chris Richardson’ timely (albeit timid) commentary, I’m also struck by the hypocrisy. It’s the orthodox economists (like Richardson) who have helped embed this surplus nonsense into the minds of politicians and economic journalists, from whence it trickles down to Mr and Mrs Suburbia to become received wisdom.

    Apart from Bill Mitchell (and maybe Steve Keene ?) I can’t think of one economist who has come out and criticised the much hyped surplusesof the Howard/Costello regime.

    If, right now, some 60 percent (?) of the population support action on climate change, whilst probably not fully understanding the arcane scientific underpinnings, how come almost 100% accept the drivel that underpins the surplus mantra when they are surrounded by the real-time and historical contradictions ?

    Got me beat !

    Meanwhile, whenever you hear Hockey, Robb, or Abbott bang on about fiscal rectitude and supluses, picture in your mind somebody winding rope around their neck whilst looking up for a low hanging branch.

  39. .against Min

    lol, I wondered what you were talking about, until I read it back to myself

    Now, that raises the question, what are you doing with a stoopidometer redlining up against you Min? 😆

    I’m just watchg QandA. turnbull and reith are just making a mockery of themselves and their party. It’s quite amusing.

    turnbull also said that we should be flying Qantas if we want to support it. And yabot is flying …. what again ROFL

  40. A little off-topic but as it’s included in the Abbott versus Robb stouch..might this be Turnbull jockeying for position..

    Liberal frontbencher Malcolm Turnbull last night declined to endorse Mr Abbott’s rejection of statutory individual contracts. Mr Turnbull said there should be maximum flexibility in the workplace. He also said the Coalition shouldn’t be frightened of the ”WorkChoices bogey”.


  41. Yes I agree. Our small govt debt thanks to Howard and Costello is way to small.

    How can we look countries like greece, Spain, Ireland in the eye.

    We need to have a debt like they do and Swan is the man to do it.

  42. Pip, I was going to give QandA the flick, but watched it. I thought Jessica Rudd was a revelation; she is a very savvy young woman and gave a very good account of herself, particularly when the inevitable “leadership challenge” shit was raised by some clown in the audience.

    She was seated between Turnbull and Reith. She takes no prisoners. the audience seemed very impressed with her.

    I disagree with CU on the balance issue. That was the initial reason I’d decided not to watch, but I thought it wasn’t too bad. Even the audience seemed more willing to listen and evaluate what was said, than barrack.

    Reith was OK in a couple of spots, but for the rest of the time adopted the sticking his head up Liealot’s backside. And for the first time in ages, we were told that Liealot is “genuine”. Genuine what was not made clear.

    I also thought Kate Ellis was pretty good. She didn’t allow Reith or Turnbull to get away with any crap.

    Ray Martin was really good, imo. He’s had time to scrub channel 9 off himself and was a reincarnation of the young journo on the ABC. The points he made were fair and balanced and well received. He also gave the GOP a fairly decent serve which In interpreted as a thinly veiled attack on the Liars Party.

    Even Tony Jones had shed some smarm. He must have been hosed down before the program started! 🙂

    Turnbull. Yes. He has smelled blood in the water and it’s Liealot’s. He was very evasive on AWA, SerfChoices and climate change and not once came out with even lukewarm support for Liealot.

    He is definitely jockeying for another stab (in Liealot’s back this time) at LOTO, by distancing himself from the Liealot stance. It’s clear that there is serious undermining happening, yet the msm is studiously avoiding noticing it.

    They’d rather keep hammering away at the non-existant leadership challenge by Kevin Rudd.

    MJ @9.22am, Mr & Mrs Suburb think a surplus is like rainy day savings, which sensible people have in case of whatever, because they have been bamboozled by the Liars Party into thinking that running a country and its budget is just the same as a household budget but bigger.

    Tom R, it was interesting watching Turnbull, I thought. Slithering around as if he was coated in oil to avoid supporting his beloved leader on any issue that was raised. Liealot had better watch his back!

    I wanted to smack that tosser who begged him to lead the Liars party again so he could vote for them as Turnbull’s head swelled another metre or two. These clowns have very short memories, obviously.

    Turnbull was an absolute disaster as LOTO. He was arrogant (still is, of course), intemperate and showed very poor judgement and a lack of political nous. And I feel certain that has not changed.

    Interesting times ahead, methinks as the opposition chews its leg off in a bitter and destabilising struggle for the leadership! Who’s got the popcorn?

  43. Tom R maybe some of the criticism of journalist is beginning to bite.

    Also what that whistle blower said on Friday at the Qantas appearance at the Senate Hearing, is felt by many.

    Many on AWA’s that are now coming up for renewal.

    He ssaid that the only people he heard praise AWAs were NOT on them.

  44. I know this is off thread but I am sick of people saying that the PM gained extra votes by saying there would be no carbon tax.

    I believe making that statement, there were less votes, not the other way around.

    The truth is that many, a great many have no real interest either way but will glad to see the matter settled, just as happened with the GST.

    They will not want to revisit the matter.

    That I believe to be the truth.

  45. Mr. Turnbull wore a new jacket last night on QandA .

    That must mean that Mr. Tunbull is challenging Abbott. What else would such a new shiny jacket mean.

    I love the message at the bottom of the scen, ABC24. Greens saying that Abbott is running away.

  46. Listening Abetz. GST revisited. I seem to remember it was as just as unpopular. So unpopular that it cause the demise of the Democrats for supporting the GST.

    By the way, Senato Wong said earlier that Mr. Abbott’s blood oath is becoming very watery.

  47. Has anyone noticed. for a so called important bill, there are many spare seats in the gallery.

    I think it maybe more important for the pollies than the public.

  48. Has anyone noticed the lovely photos of the PM. Ones that make her look a competent, friendly lady.

    …………”It’s not often that Rupert Murdoch’s local tabloids or broadsheet blow Opposition Leader Tony Abbott and opposition Treasury spokesman Joe Hockey away, but that’s just what Laurie Oakes did in his Saturday column.

    He gave ”attack dog” Abbott both barrels for his plain dumb stance in rejecting the mining tax in any form, plus slapped down Abbott and Hockey for ”advocating their feral version of economic isolationism” in opposing the possibility of Australia increasing its loan to the International Monetary Fund…

    Read more: http://www.theage.com.au/opinion/politics/coalition-guilty-of-credibility-failure-20111107-1n3wt.html#ixzz1d4caklnJ

  49. I’m not sure what Neil was admitting. Either it was tongue in cheek or he’s finally seen the light of day.

  50. No, Roswell, he is becoming confused.

    He must, along with other, stunned by the news that the PM might not be hated and there is criticism or no support for Mr. Abbott.

  51. CU @11.51am, I agree. I’d be willing to bet that the majority hadn’t given it a thought, because an ETS and carbon price had been part of ALP policy for several years.

    I think votes were lost because of the hatchet job by the Liars Party and the msm on the stimulus spending. what made me angry was the tradies who would have been sunk without it, whining about government spending! sometimes I think the government should have let the buggers lose their jobs!

    And you must be right about an imminent challenge from Turnbull; the jacket is a dead giveaway. And he didn’t sit next to Reith. That has to mean the challenge will happen before Obama gets here. Gee, I hope this shambolic opposition doesn’t embarrass the POTUS by changing leaders just before he arrives, don’t you? ROFL!!!!!

    He is admitting the debt is small, CU, but he attributes this to the Rodentochracy. However, this is quite an admission, just the same. Never mind, next comment will have the country bent over like a water wheel under the weight of the astronomical debt-surely the biggest debt in the history of any nation in the universe!!!!!

  52. And the closing comment from the Courier Mail piece is telling too. I’ve mentioned this before but the journalist mantra is: Headline, pic, opening paragraph, closing paragraph. Because this is basically all that 80% of the population absorb when looking at any article.

    A popular refrain from the Opposition benches is Labor’s alleged propensity to “tax and spend”, but the Coalition, with its string of what appear to be ad hoc responses, risks painting itself into a policy corner of “big spending, little taxing” – ironically just the sort of policy that got the likes of Greece into trouble in the first place.

  53. What the Opposition is forgetting, there are also reforms to taxation and economy.

    As is was for super they also fought so hard against.

    You can bet that this PM will be out quickly, undoing the harm that Mr. Abbott has caused.

    After all successful manufaturing owners are not stupid. I assume their accountants will soon tell them they have been mislead.

  54. I find it so laughable that Hockey has found a way of linking Richardson’s statement to equals Labor is bad. Silly man.

  55. Min @ 1.45pm,

    was this really in a ltd news publication?

    but the Coalition, with its string of what appear to be ad hoc responses, risks painting itself into a policy corner of “big spending, little taxing” – ironically just the sort of policy that got the likes of Greece into trouble in the first place.

    Amazing !

  56. Is it all over but for the shouting today? it is time for the Coa;ition to stop their whinging and move on?

    Patricia, could you create a poem on what one thinks of whiners and whingers.

    We have whining Pyne but I cannot think of anymore. I do not have that skill.

    “….Minister Julia Gillard to all-time lows. Upping the ante further, he made a “blood oath” last month to repeal the laws if he wins power in 2013.

    It’s a vow he could regret.

    A combination of pressure from business demanding certainty for investment, voter fatigue and the constitutionally tortuous process of repealing laws will likely force Abbott to back down, analysts say. If an Abbott-led government presses ahead with the repeal threat, it risks damage to the economy, legal action and high costs for industries, they say.

    The scheme begins in July and businesses from liquefied natural gas (LNG) producers to power generators simply want to move on and comply. The government and Greens have a majority in the upper house Senate, ensuring it will pass.

    “He’s said it’s written in blood, but you can promise to defy gravity and you’re not going to do it,” said Norman Abjorensen, a political analyst at the Australian National University.

    Voters and business may well find the scheme is not as costly as portrayed by Abbott. A government compensation package will defray the cost for more than 90 percent of households, while some industries will get substantial sweeteners.

    “I think when the positive side starts to kick in, and the huge relief package, and people see the dollars on the other side of it, it will dissipate the anger,” Abjorensen told Reuters



  57. And when they realise that they are not paying carbon tax but their tax burden is being reduced, they might finally realise they’ve been flim flammed by the Liars Party and their cheerleaders and express their feelings at the ballot box.

  58. Sue, good work.
    Repeating relevent links [ all over again 😀 ] in the hope of some common sense and truth reaching the wider public is a postive step in the right direction.
    There has been such a swift change of direction in the mainstream media, one jug-eared head must be spinning !

    After the fuss from Abbott about a loan to the IMF there is this:-

    As Business Council of Australia chief executive Jennifer Westacott put it: “Australia has acted in such a way as a global citizen in the past by agreeing to contribute through the IMF during the Asian financial crisis and should be prepared to do so again if necessary to support global and ultimately our own economic interests.”

    Abbott should also note that it is the IMF and its teams of inspectors that oversee the very austerity measures in debt-stricken countries in Europe that are aimed at carving back government waste and cutting back unfunded welfare entitlements such as generous Greek retirement packages.

  59. Roswell, we’ve been trying to lure the gentlemen..so far not very successfully, you being the exception. However, we’re hoping for improvements 🙂

  60. We will put up a bill to rescind. It this does not work, we will go to a DD and then past the bills.

    There are a couple of “ifs” left out.

    The first, if they win the next election. The second if they win the DD. What arrogance to assume they will.

  61. Jane and their tax free threshold is 30,000.

    There are lots of sweeteners and reforms as as well.

    Clever PM, she does not miss a chance to introduce another economic or tax reform.

  62. For,Neil. Something we have been saying about Howard/Costello for a long time but now it comes from the keyboard of a right wing media mouthpiece.

    Certainly more than a decade of sound economic stewardship during the Howard-Costello years (albeit with some caveats about lavish recurrent expenditure commitments made on boom-time revenues)

  63. And the other thing I’ve been Saying for a while is that Abbott is trashing the Liberal brand, maybe irreparably, is also mentioned. Maybe his own are turning on Abbott because they see the long term damage he’s doing.

  64. ME, it doesn’t matter to the diehards that Abbott is thrashing the Liberal brand. They detest Labor so much that their only goal is to see Liberals in power, no matter what the brand.

    I used to be a Liberal voter but as far as I’m concerned they are now damaged and the repair job is too great to mend.

  65. ‘I used to be a Liberal voter…’

    It’s a time of political upheaval, I used to be a Labor voter.

  66. Roswell, this is indeed a phenomena that Liberal voters continuously avoid the Question of why Abbott would make such a wonderful Prime Minister. They do a Joh Bjelke-Petersen…never you mind about that.

  67. Yabbott is not popular with the electorate and I mentioned on the other thread that Talcum still has his eyes on the leadership.

    There are many Labor Party supporters who think Malcolm Turnbull should lead the Liberals, but this of course would be a disaster for the Coalition.

    They would split and Barnaby Joyce, after capturing a lower house seat, should find the numbers to become leader of the Nationals.

    A state of political flux.

  68. El gordo, split? Abbott only won by one vote. With Turnbull the Liberals have a chance to throw out the old has-beens and promote some up and comers..far too many seat warmers left over from the Howard era.

  69. The who? The Nats don’t get a say on who is the leader of the Liberal Party. The Nats don’t even get a say on policy. At the last election the Nats garnished an incredible 3.43% of the vote.

  70. And there were the Nats 3.4% today complaining that Greens with 12% of the vote had too much influence.

    Reality check

    MPs Nats 11 Greens 1

    Senators Nats 6 Greens 9

  71. It’s a bit late I know but I’ve been thinking about Pip’s comment right back at the top, the comment that included the quote from Nicholas Gruen about how taxes would pay back 22.5 cents of every dollar of stimulus.

    I was curious about why Gruen would emphasise the revenue side of the stimulus rather than the actual stimulus effects, until I clicked on Pip’s link and read the whole thing.

    But Gruen also said the following:

    “Results were even better for the infrastructure spending. Where some of the cash payments were saved, all of the infrastructure spending went straight into the Australian economy. And with larger ‘multipliers’ than consumer spending, every $1 of government infrastructure spending increased output by $1.20 generating 36 cents of government revenue.”

    Although controversial (conservatives hate the government actual doing stuff…unless it’s corporate welfare), there’s plenty of evidence that a dollar of government spending adds nearly $2 to the GDP before tax and savings have nibbled it away to nothing.

    And the proof was certainly in Kevin’s pudding.

  72. Mangrove Jack have a read of this, on an infrastructure spend, an example of your argument.

    Mr Albanese said road safety was a prime advantage and the nine- kilometre road was as much about “saving lives” as achieving productivity and efficiency on the interstate transport corridor

    NSW Roads and Maritime Services’ Hume Highway manager Tony Dobbin and Abigroup bypass project manager Courtney Hoops have led an army of 1500 workers involved in the project since it started in February 2010.

    “About half the jobs went to local people,’’ Mr Dobbin said.

    “It has brought a lot of money into the area.”

    About a third of the $265 million is thought to have been spent on wages and employment costs.”

  73. Thanks for that link Sue.

    I imagine there are regional towns, communities, everywhere who could tell similar stories. The regional press is usually of a conservative bent but a good story is a good story, and their readership wants to hear it !

    At the national level that kind of stuff just gets drowned out by the endless and mindless re-telling of the BER and Pink Batt (sorry Min) nursery stories: “once upon a time children there was a witch, a red haired witch…”

    But not for much longer. I sense a change in the direction of the political breeze.

    Here’s a link for you. Bill Mitchell on spending multipliers.


  74. I might have to read that a couple of times Mangrove, but thanks for the link. It’s a learning curve. It’s all upwards from here.

  75. Mangrove Jack @ 8.39am,
    it’s never too late to post links such as Nicholas Gruen’s, in fact the more they’re posted the more chance that people will understand they’ve been conned by the “no brigade”. 🙂

    The same can be said for the Peter Martin articles about Hockey and Robb, and the mess they made of their budget costings assumptions “audit”, which is stil under investigation by the Chartered Accountants Association.



  76. Yes Roswell, Bill Mitchell’s ideas are also very counter-intuitive (at first) because we have all been fed bullshit for so long it’s imbedded in our reptilian complex.

    But persist and you will be richly rewarded.

    And Pip, thanks for those links to Peter Martin. You’ve reminded me I should drop in more often.

    I notice Mitchell and Martin cross-link, so I can be fairly certain I won’t pick up something nasty there.

  77. The world’s economy is about to go pear shaped. Swan will have no alternative but to open his wallet. It worked last time.

    Peter Martin is one of the last decent journalists left in the country. He’s also easier to read than Bill Mitchell. 😉

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