Economy gets big tick (TheAge)

[Tigers of Old]

Of course I am happy to have my tax money spent on schools, hospitals, police, fire fighters, etc. Throwing that up is intentionally dirtying my argument.

I get mad about the deficit because it has been created without providing any of these things.

It was spent on schools.

The two schools my son has attended over the past 3 years had a gymnasium/public area built that didn't exist previously and 2 brand new large classrooms which put kids into a far better environment than they were previously. Sure it is difficult to quantify how much of a direct im[pact that has had on any child's education but it is also hard to ascertain how much the construction of all these school buildings had on driving the economy. You say all these contractors were busy? I'm not convinced at all of that. This was happening right in the middle of the GFC remember and these builders, architects etc. had work and we largely passed through the GFC unscathed. Now not so much..

 

[Willo]

cant argue when you put it like that.

every australian owes over $205000 and it is all Gillards fault. outrageous.

Well if you're saying it's Gillard's fault, next time you're talking to her, tell her I want my share back. I could sure do with it and could spend it more wisely. Thanks Brodders.

 

[MB78]

So we're paying $5 billion in interest every year. Yep $5 billion without touching the principal. Sound economics? You can make your own judgement.

That's it. What's the plan the government have in place to address this? All I hear is spin from Swan and Gillard.

 

[Rosy]

On waste.....those effected by the Tasman Peninsula fires are able to make claims of up to $1000 for inconvenience, etc from Centrelink. You don't need to provide any proof, and don't have to show you have lost property, etc, simply state you were camping in the area and Julia hands you your cheque.

Having had experience with people in the Black Saturday bush fires in our district that comment disappoints me a bit Rob. I can't see the situation being too much different no matter who the Govt is. Certainly not a situation exclusive to "Julia" and I reckon it's pretty ordinary to bag the support that way. Many people impacted by the fires have nothing. No proof of identity, no available records, no money, no toothbrush...not even a change of undies. Surely you can't expect Centrelink to require licences, documents etc to prove eligibility on the spot? Bludgers and no-hopers can make bogus claims, as they did here at the time, but they can be tracked down and prosecuted later. Surely those left destitute should be a priority? How can that be if they are required to go through red tape and endless forms Centrelink usually requite to establish eligibility?

 

[Tiger Rob]

Having had experience with people in the Black Saturday bush fires in our district that comment disappoints me a bit Rob. I can't see the situation being too much different no matter who the Govt is. Certainly not a situation exclusive to "Julia" and I reckon it's pretty ordinary to bag the support that way. Many people impacted by the fires have nothing. No proof of identity, no available records, no money, no toothbrush...not even a change of undies. Surely you can't expect Centrelink to require licences, documents etc to prove eligibility on the spot? Bludgers and no-hopers can make bogus claims, as they did here at the time, but they can be tracked down and prosecuted later. Surely those left destitute should be a priority? How can that be if they are required to go through red tape and endless forms Centrelink usually requite to establish eligibility?

My comment was certainly not meant to offend anyone with legitimate need. My utter frustration is that the Centrelink people are told that they must pay upon request. Allowing my tax money to be fritted away without any checking whatsoever is criminal IMO.

 

[Tiger Rob]

It was spent on schools.

The two schools my son has attended over the past 3 years had a gymnasium/public area built that didn't exist previously and 2 brand new large classrooms which put kids into a far better environment than they were previously. Sure it is difficult to quantify how much of a direct im[pact that has had on any child's education but it is also hard to ascertain how much the construction of all these school buildings had on driving the economy. You say all these contractors were busy? I'm not convinced at all of that. This was happening right in the middle of the GFC remember and these builders, architects etc. had work and we largely passed through the GFC unscathed. Now not so much..

I can tell you categorically that at that point in time Tasmania's economy was still going very well. We did not have a down turn at that stage. As I said I had a fair bit to do with the schools stuff and I can tell you honestly here all those involved had plenty of work on.

 

[Rosy]

My comment was certainly not meant to offend anyone with legitimate need. My utter frustration is that the Centrelink people are told that they must pay upon request. Allowing my tax money to be fritted away without any checking whatsoever is criminal IMO.

Agree it's not an ideal situation when lowlifes can rort the system but I don't see how someone who's lost everything can be expected to wait for days, even weeks, while checks are put in place. There is distressing hysteria, heartbreak, devastation and mayhem at fire evacuation points. Victims need the money immediately even if they can't tick the identity and eligibility boxes. Bearing in mind so many have nothing but the clothes they were wearing what do you see as a solution Rob? I think it would be more criminal not to give some immediate help those so desperately in need.

 

[Willo]

Having had experience with people in the Black Saturday bush fires in our district that comment disappoints me a bit Rob. I can't see the situation being too much different no matter who the Govt is. Certainly not a situation exclusive to "Julia" and I reckon it's pretty ordinary to bag the support that way. Many people impacted by the fires have nothing. No proof of identity, no available records, no money, no toothbrush...not even a change of undies. Surely you can't expect Centrelink to require licences, documents etc to prove eligibility on the spot? Bludgers and no-hopers can make bogus claims, as they did here at the time, but they can be tracked down and prosecuted later. Surely those left destitute should be a priority? How can that be if they are required to go through red tape and endless forms Centrelink usually requite to establish eligibility?

Fair comment. No doubt there are those that would take advantage, but the I agree those that had nothing should be the absolute priority. (Regardless who is in government).
My heart goes out to those who lost everything (material). Even more so to those who lost loved ones and friends. Situations like these are when everyone should come together to help out those that have suffered. I don't see any merit in politicising this at all. Sure some will take advantage, they always will, but the biggest factor is immediate assistance to those that need it.

 

[Giardiasis]

Neither you nor anyone else has answered that yet.

The answer is it won’t be paid off, as it would be political suicide to attempt to do so. The government can’t raise taxes because people won’t elect them. The government can’t cut spending, because people won’t elect them. There is next to Buckley’s chance they will see an increase in revenues anytime soon.

Hence they will continue to spend via the instrument of monetising debt by their friends at the RBA. Both political parties support this.

The debt won’t be paid off; it won’t even be stopped from increasing. It will one day blow up, but that’s a problem for the next generation of politicians/voters.

 

[Willo]

The answer is it won’t be paid off, as it would be political suicide to attempt to do so. The government can’t raise taxes because people won’t elect them. The government can’t cut spending, because people won’t elect them. There is next to Buckley’s chance they will see an increase in revenues anytime soon.

Hence they will continue to spend via the instrument of monetising debt by their friends at the RBA. Both political parties support this.

The debt won’t be paid off; it won’t even be stopped from increasing. It will one day blow up, but that’s a problem for the next generation of politicians/voters.

That's exactly the point.
I don't believe both political parties support it to this extreme level, that's increasing day by day. History shows that the recent Coalition governments had much lower debt levels and were able to service the debt.
I've got no doubt that all governments borrow/monetise debt. But at the current levels?

That's my concern, something will blow up, pity whichever generation when it does.

 

[Giardiasis]

That's exactly the point.
I don't believe both political parties support it to this extreme level, that's increasing day by day. History shows that the recent Coalition governments had much lower debt levels and were able to service the debt.
I've got no doubt that all governments borrow/monetise debt. But at the current levels?

That's my concern, something will blow up, pity whichever generation when it does.

The Coalition love spending as much any major political party. The key isn't servicing debt, it is spending levels. The Coalition happened to be around when revenues were high enough to service their level of spending, and to pay off government debt.

The Coalition aren't going to be elected if their policies are aimed at eliminating the debt (hell even reducing it) given the decrease in government revenues, because people won't accept tax increases or spending cuts. Individuals in the Coalition might not be comfortable with the current level of government debt, but the alternative would have them sitting on the wrong side of Parliament.

Both parties support our current banking system, i.e. fiat money, fractional reserve lending and the existence of the RBA. This is because it is the only politically acceptable way to finance their spending. Inflation must always be met with deflation. Given the goal of the RBA and other central banks around the world is to inflate at all costs (and hence not allow natural deflation to correct a change in demand for money), our economy, and the world economy will eventually see a massive write off of wealth.

Theoretically if we could change our financial system to one that isn't fundamentally flawed, it would still not solve the issue. Democracy is also fundamentally flawed, because groups of people will always band together in order pressure politicians to advantage them over all others. Politicians want to be elected, and hence we will be back to where we are now. People don't live long enough to learn the lessons of financial history, and neither do they even care to learn about it.

 

[tigersnake]

That's exactly the point.
I don't believe both political parties support it to this extreme level, that's increasing day by day. History shows that the recent Coalition governments had much lower debt levels and were able to service the debt.
I've got no doubt that all governments borrow/monetise debt. But at the current levels?

That's my concern, something will blow up, pity whichever generation when it does.

The coalition government were able to do this because they didn't spend anything, no big ideas, no infrastructure. Recent IMF study showed they were very wasteful with middle class welfare though.

 

[tigersnake]

The Coalition love spending as much any major political party. The key isn't servicing debt, it is spending levels. The Coalition happened to be around when revenues were high enough to service their level of spending, and to pay off government debt.

The Coalition aren't going to be elected if their policies are aimed at eliminating the debt (hell even reducing it) given the decrease in government revenues, because people won't accept tax increases or spending cuts. Individuals in the Coalition might not be comfortable with the current level of government debt, but the alternative would have them sitting on the wrong side of Parliament.

Both parties support our current banking system, i.e. fiat money, fractional reserve lending and the existence of the RBA. This is because it is the only politically acceptable way to finance their spending. Inflation must always be met with deflation. Given the goal of the RBA and other central banks around the world is to inflate at all costs (and hence not allow natural deflation to correct a change in demand for money), our economy, and the world economy will eventually see a massive write off of wealth.

Theoretically if we could change our financial system to one that isn't fundamentally flawed, it would still not solve the issue. Democracy is also fundamentally flawed, because groups of people will always band together in order pressure politicians to advantage them over all others. Politicians want to be elected, and hence we will be back to where we are now. People don't live long enough to learn the lessons of financial history, and neither do they even care to learn about it.

Generally agree with you Giardiardis.

You probably won't agree with me on this:

Coalition > big revenue > big spend on middle class welfare > no spend on infrastructure > balanced books

ALP > less revenue > trying to rein-in middle class welfare, tough ask, still a big spend > spending on infrastructure, playing catch-up on 11 years of nothing .> deficits

IMO, the Coalition, that bastion of shrewd fiscal responsibility, pissed one of the greatest bonanzas in our nation's history up against the wall. It was a disgrace we'll be paying for maybe for generations. But people kept voting for him.

 

[Willo]

The coalition government were able to do this because they didn't spend anything, no big ideas, no infrastructure. Recent IMF study showed they were very wasteful with middle class welfare though.

As long as you're happy with the direction we're heading.

Generally agree with you Giardiardis.

You probably won't agree with me on this:

Coalition > big revenue > big spend on middle class welfare > no spend on infrastructure > balanced books

ALP > less revenue > trying to rein-in middle class welfare, tough ask, still a big spend > spending on infrastructure, playing catch-up on 11 years of nothing .> deficits

IMO, the Coalition, that bastion of shrewd fiscal responsibility, p!ssed one of the greatest bonanzas in our nation's history up against the wall. It was a disgrace we'll be paying for maybe for generations. But people kept voting for him.

What a load of absolute hogwash.
One minute you say they didn't spend anything, the next they pissed it up against the wall. Funny how they left a fair whack t($50-60 billion) that's gone, plus another $260 billion of borrowings.

Tell me, exactly how much and what did they waste it on? How much waste "will we be paying maybe for generations?"
A reply with facts (or links) would be appreciated.
I think you've got a touch of the sun mate. Labor have spent $300 billion plus so far.. The coalition left money in the bank.

 

[tigersnake]

As long as you're happy with the direction we're heading.
What a load of absolute hogwash.
One minute you say they didn't spend anything, the next they p!ssed it up against the wall. Funny how they left a fair whack t($50-60 billion) that's gone, plus another $260 billion of borrowings.

Tell me, exactly how much and what did they waste it on? How much waste "will we be paying maybe for generations?"
A reply with facts (or links) would be appreciated.
I think you've got a touch of the sun mate. Labor have spent $300 billion plus so far.. The coalition left money in the bank.

I'd thought I'd made it clear, they spent nothing on infrastructure, thats where the nothing come in. They spent sh!tloads on un-means tested, middle class welfare, thats where the p!ssing up against the wall comes in. No contradiction, very clear, very simple. But don't take my word for it Willo, that pinko organisation the IMF says the same thing, (they also said Rudd was wasteful, so there you go).

 

[tigersnake]

I think you've got a touch of the sun mate. Labor have spent $300 billion plus so far.. The coalition left money in the bank.

Definately got some sun, I'm in Brisbane, but hasn't affected me. The Coalition spent nothing on infrastructure. They had heaps of revenue via mining boom they spent on giving money to people who didn't need it to maintain their vote, which worked a treat.

The cost to us now and in the future is the wasted opportunity of the mining bonanza that could have built the nation, instead of going to Harvey Norman and Wesfarmers shareholders.

 

[Willo]

I'd thought I'd made it clear, they spent nothing on infrastructure, thats where the nothing come in. They spent sh!tloads on un-means tested, middle class welfare, thats where the p!ssing up against the wall comes in. No contradiction, very clear, very simple. But don't take my word for it Willo, that pinko organisation the IMF says the same thing.

So how much was actually spent on welfare? No figures? Shitloads is how much?
No doubting the IMF said there was "fiscal profligacy". How much then was spent on Welfare and how much now? Any idea or did you just read the headline article?

You still haven't answered how we'll be paying for it for generations to come, when the Coalition left money in the bank. It's not as if they emptied the coffers and borrowed exorbitant amounts of money and left a huge debt for Labor to service, is it?

What infrastructure have we had from Labor to justify $300+ billion in spending/borrowing?
Pink batts..pfft the BER $16 billion (some waste but some good), what other infrastructure has been built?

 

[Willo]

Definately got some sun, I'm in Brisbane, but hasn't affected me. The Coalition spent nothing on infrastructure. They had heaps of revenue via mining boom they spent on giving money to people who didn't need it to maintain their vote, which worked a treat.

The cost to us now and in the future is the wasted opportunity of the mining bonanza that could have built the nation, instead of going to Harvey Norman and Wesfarmers shareholders.

Yeah well it's 40 degrees here and I've got some.
Are you saying that there hasn't been a mining boom during the last 5 years or so? I know the GFC affected it to a degree, but obviously with the Mining Tax the government had big plans for another tax boom. Got that wrong as well.

Harvey Norman and Wesfarmers? What about the money Kevvy handed out? Forgot about that or is it covered with "stimulating the economy? The "free" set top box, Harvey Norman would have done handsomely out of that.

 

[mld]

Without wanting to get into a white-hats black-hats argument, I'd say the major problem with the expansion of middle class welfare under the Howard-Costello government was that the spending was implemented as an ongoing measure, funded by a temporary increase in revenue. This makes it very difficult for future governments to remove such payments that people now feel that they are entitled to, even in the face of a reduction in revenue. It is very easy to increase spending, and very difficult to remove the increase.

Agree or disagree with the Rudd-Swan stimulus measures, the cash hand-outs were not ongoing.

 

[Giardiasis]

Anyone willing to discuss my points, or is this another Libs vs ALP cheerleader battle?