John Roskam on the 10th anniversary of the Rudd stimulus package

On the silence of the Libs and Labor.

The fact that no-one wanted to talk about the legacy of the stimulus package is revealing. Labor didn’t want to discuss it because it brought back memories of the terrific waste involved, while the Coalition didn’t want to talk about it because to do so would reveal that they’ve done practically nothing to bring federal government debt under control. Both sides of politics have made the calculation that at the moment, in the midst of 28 years of uninterrupted economic growth, there’s few votes to be won by talking about government debt. The fact that in recent years it’s been population growth not productivity improvements that have fuelled that growth is also not discussed. It seems that to the major political parties, government debt is something that the voters’ children and grandchildren can worry about when the time comes. To me that’s a failure of leadership.

The gross debt of the federal government is currently approximately $560 billion. In the 2018/19 financial year the federal government will spend $17.8 billion on interest payments. Seventeen billion of anything is a big number to get your head around so let me put that into perspective. Interest is now the sixth largest single component of federal government spending after Social Security and Welfare ($175b), Health ($78b), Education ($34b), Defence ($31b), and what’s called ‘General Public Services’ ($24b) which includes public service salaries, foreign affairs and foreign aid ($5.7b), and superannuation benefits for retired public servants ($5b).

If you look at bit more closely within those areas you’ll see that we’re spending more on interest than we do, for example, on income support for people with a disability ($16.5b), higher education ($9.7b), or unemployment benefits ($10b).

A great time to contemplate higher power prices, significant threats to our major export industry, erosion of productivity by CFMEU-driven IR reforms and a rampant Keynesian in the Treasury. Not to mention higher taxes and the impoverishment of self-funded retirees. This party is the light on the hill?

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18 Responses to John Roskam on the 10th anniversary of the Rudd stimulus package

  1. Helen

    No wonder Bill wants to raid our piggy banks. Can’t borrow more, can he?

  2. Dr Fred Lenin

    Those responsible should be tried for theft ,have all family assets confiscated and be sent to a gulag on Hearde Island for life .

  3. stackja

    WA wave power company suspended from ASX
    Australian Associated Press
    March 1, 2019 5:39pm

    The cash-strapped company that received WA government funds despite not meeting targets attached to a wave power project has been suspended from trading on the Australian stock exchange.

    Carnegie Clean Energy was on Friday suspended for failing to lodge its half-year financial report in time.

    In a statement to the ASX, the company said it regretted missing the deadline and was working closely with auditors to have the accounts lodged as soon as possible.

    It emerged in parliament in September that Carnegie had not cleared any hurdles connected to the Albany project, but the following month it still got a $2.625 million payment, described as being part of a “variation” to the first $5.25 million milestone.

    Carnegie was also given a nine-week deadline to submit its detailed funding plan for the project to the state government, but was granted an extension to February after citing uncertainty around changes to federal R&D tax incentives.

    Premier Mark McGowan said the funding plan was being reviewed by cabinet.

    “Clearly it’s a concerning situation,” Mr McGowan told reporters.

    The company posted a $63.34 million net loss for 2017-18, revealing it paid $2.12 million in wages and fees to its executive team and consultants during the period.

  4. Tel

    It seems that to the major political parties, government debt is something that the voters’ children and grandchildren can worry about when the time comes. To me that’s a failure of leadership.

    No, it’s a failure of the followers to care for their own children and grandchildren.

    They can easily have different leadership, all they have to do is vote for it. My vote doesn’t mean much, but if lots of people do it, then it does mean something and they have proven they can unseat the major parties. If people refuse to do that, we can conclude they are short sighted and prefer things the way they are.

  5. 1735099

    No, it’s a failure of the followers to care for their own children and grandchildren”.

    Same kind of failure as those who are unprepared to take action on global warming, then?

  6. Rafe

    The best way to anticipate hot weather is to r educe power price so vulnerable prople can afford air conditioning.

  7. Perth Trader

    What is Aust. gross debt including Federal , State and territories debt?

  8. Mak Siccar

    Ignore the goad by the GetUp Troll.

  9. Boambee John

    Numbers

    Same kind of failure as those who are unprepared to take action on global warming, then?

    The debt and the interest costs are real

    So too is climate change. What is still an unproven (unprovable?) hypothesis is Catastrophic Anthropogenic Global Warning (emphasis added).

  10. Neil

    https://www.budget.gov.au/2018-19/content/bp1/download/bp1_bs11.pdf

    Table 4 says net debt was approx. zero in 2005-06 and minus $40B in 2007-08 ie less than zero. It is now at plus $350B. So that is a $390B increase since 2007. Wat have we got for that $390B of govt debt?

  11. Boambee John

    Wat have we got for that $390B of govt debt?

    The HRC, the WGEA, and sundry other wastes of money? And we have yet to get thecPyne class sea bottom decorations.

  12. Wil

    Why are the unions pushing hard about this so called crisis of catastrophic global warming all of a sudden?
    There must be some connection with the election and union power (pardon the pun) after they get in.
    It’s all over the media, same story every time, every interview.
    We are doomed.

  13. Russell

    Why are the unions pushing hard about this so called crisis of catastrophic global warming all of a sudden?

    Union controlled super funds are very heavily invested in renewable energy companies and their projects. They need to keep on the ratbag message because those funds are now more powerful than the old union push for more members. Not even putting up a fight with closing jobs in the coal industry.

  14. Jonesy

    Yep, the ponsie scheme is pushing hard to have super payments more regularly alongside wage payments…now, why would they want that? Surely, they feel for their individual members…or more likely…cashflow!

  15. Roger W

    The simple truth is that making a virtue out of debt reduction is not a vote winner.
    Talk to just about anyone under 40 (50?) and they are in debt up to their eyeballs, with credit cards maxed out. They don’t see this as unusual or even, in many cases, a worry. If the next iphone comes out, they have to have it. A holiday abroad? They deserve it and it can go on credit (if they have any left). Cards maxed out? Apply for another one and with luck you will get it. It may start to get harder now but the attitude to debt has already been hard-wired in. And there is always the bank of Mum and Dad. Pity about the next generation, though.

  16. IRFM

    I do recall valiant attempts to reign in expenditures only to be thwarted in the Senate by a cross benchvof feral proportions – I think all criticisms should be made with that in mind.

  17. Squirrel

    “………. and what’s called ‘General Public Services’ ($24b) which includes public service salaries, foreign affairs and foreign aid…….”

    We pay our federal department heads as much, or more (depending on their ranking), than the President of the United States and considerably more than the British Prime Minister – and lavish salaries and gradings seem to cascade down from those lofty heights. A governing class which is this out of touch with everyday Australians, and so very comfortable on the public purse, is unlikely to be advising any government on truly strict budgetary options – even if they had a receptive government to advise.

    The shrinking supply of credit sloshing around the international markets will eventually do the trick (that’s when the apologists will discover that our debt is only “low” in relative terms), and then there will be a lot of time to reflect on the squandered opportunities of the past decade, or so.

  18. Augustus Carp

    I got my first LED TV thanks to krudd’s $900 gift. That 42″ Hisense lasted until last year when the picture seemed a little off and it was replaced.

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