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The Forum > Article Comments > Labor's recession recovery myth > Comments

Labor's recession recovery myth : Comments

By Arthur Thomas, published 20/8/2010

The Labor economic war strategists have fired off all their economic ammunition while ignoring the need to retain reserves for the unforseen.

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China stimulus package good; Australian stimulus package bad! Shades of George Orwell.

All economic activity carries some risk. China has, I believe, far more cement production capacity than it can possibly utilise and I suspect the same applies to steel.

Australia's financial position is capable of supporting another round of stimulus spending if that becomes necessary.

The Coalition has been critical of some waste in the stimulus packages but it has never criticised the waste attributable to major companies. BHP spent billions on a direct reduction plant which was a failure and through tax reductions the public carried a significant proportion of that waste. I wonder how much the failure of ABC Learning due to poor management has reduced the potential tax income. There are many other examples such as RIO's takeover in the aluminium industry.

The maintenance of employment, not any earlier action by Howard and Costello, is what saved Australia from a housing market collapse although the activities of Howard and Costello contributed to the over-inflation (bubble) of house prices which has denied many young people the opportunity to own their own home. Money for first home owner schemes usually disappears into the pockets of speculators and builders.

In the H and C era bank creation of money was about three times the inflation rate and while H and C kept their boots on the neck of wage earners the inflation caused by the banks activities went to capital assets or, in affect, to the well off.
Posted by Foyle, Friday, 20 August 2010 10:32:40 AM
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You have to laugh at the tories and their "save for a rainy day" crap.
If the global financial crisis was not a rainy day I dont know what was.
Posted by mikk, Friday, 20 August 2010 11:27:31 AM
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oh it's all so easy, you just borrow some more money

future generations won't mind paying for the follies of this generation
Posted by Amicus, Friday, 20 August 2010 12:14:49 PM
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More Liberal banner waving.
neither objective or accurate.
Posted by examinator, Friday, 20 August 2010 12:50:55 PM
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Yes Amicus, it's all so easy, at least for those who can't add up.

Foyle, that is quite right, for Oz at least.

China stimulus package, Chinese spending.

Oz stimulus package, Oz debt.

It is pretty obvious which is good for oz, & which is bad. If you look at the total expenditure in each case, it is again obvious which one did the job, & did it without burning down any Oz homes.
Posted by Hasbeen, Friday, 20 August 2010 1:14:15 PM
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WHat did save Oz from the recession? Yeah, we know Artie. Show us your Lib membership card and then say "Johnny and Pete"!

You're a fool Artie. You're actually saying Rudd should have done nothing in case there was worse to come. Read your stupid argument. So when does that rainy day come? In Lib terms, never. They sock it away in a future fund which could have been used for the spend on jobs.

Instead, what's that money doing? Sitting under Costelloe and going backwards with the market. Excellent plan.

Get a life Artie and thank goodness all don't think like you do.
Posted by RobbyH, Saturday, 21 August 2010 8:43:13 AM
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Examinator and RobbyH

A member of no political party, I focus on performance and words, and follow the trails back to the beginning identifying trends, patterns, omissions, spin and responses.

It also pays to overlay this research with event start-stop time lines related to both global and domestic issues.

Yes, the world economy was facing a crisis. Australia however, had a surplus and no debt, and was far better placed than any other developed nation to minimize the potential effect of the crisis. Time was on our side for strategy development. Action was indeed required. Panic, misinformation, political posturing and reckless spending combined with a clear lack of coordination of responsible planning, was not.

Part II will soon take you on this journey from the election of the Rudd Government to the August 21 2010 election, where a government appeared not only guilty of glossing over facts and effects of failed policies by talking up faltering economies, but also resorted to talking up a recession for pure political gain.

The August 21 election appears a clear demonstration of the priorities of party politics for survival combined with power group plays in the most negative campaign ever foisted on the Australian voting public at the expense of clearly defining strategies, relying on rhetoric, spin, and a cargo cult mentality.

Both parties failed to define the strategies that will address the real situation for Australia's economy in the coming six and twelve months due to looming changes in our major trading partners' economies and that of the global economy as a whole.

Policy promises mean nothing until shown to be working, as clearly shown in the post Rudd election period. Can you blame people for being sceptical?

While the Liberals are also relying on continuing demand from China to return the Australian economy to surplus, their proposal to defer spending on the NBN appears to be the only option available to provide some form of reserve to address the unforeseen.

Arthur Thomas
August 22, 1010
Posted by Arthur T, Sunday, 22 August 2010 4:37:08 PM
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