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The Forum > Article Comments > What skyrocketing debt? > Comments

What skyrocketing debt? : Comments

By Alan Austin, published 16/8/2013

For its increased debt Australia has to show new roads, railways, energy and water infrastructure, improved school facilities, insulation, social housing, defence housing and other public assets.

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Well no, public debt is not much of a problem, or no worse in comparative terms than having, an income of $100,000.00, and borrowing $50.00.
Hardly a problem if needed for income earning infrastructure, but a very big one if used for essential recurrent spending?
However, the same can't be said of private debt.
The highest median house prices in the English speaking world is a problem, as is the economic impact of quite extraordinary rents, that force over a million or so families to regularly go without essential staples. (Sydney is now the most expensive city in the world!)
Negative gearing was supposed to increase housing stocks, but it has done anything but!
And the record burgeoning foreign debt, well over one and a half trillion, is a problem; as is servicing it, largely at commercial rates, [which someone somewhere has to pay?]
Done no doubt to avoid tax.
Little wonder we Aussies now pay a 30%+ premium at the checkout!
We need to borrow quite differently.
Thirty year self terminating bonds ought to be at least trialled. This gets the foreign capital, minus the price gouging/tax avoiding foreign ownership.
If these foreign guests, or around 95% of corporate Australia, weren't successfully avoiding tax, the govt would likely not have to borrow at all, but get busy building an income earning sovereign fund.
Particularly if all govt service was rationalized, and made the respective responsibility of just one tier.
A doable measure that would reduce govt costs by around 30%!
Genuine tax reform is the final piece of this puzzle; which if done properly, would end all avoidance as well as costly compliance!
Which in most cases, is likely to bite deeper into the bottom line, than a single stand alone expenditure tax, which is all that's needed!
Rhrosty.
Posted by Rhrosty, Friday, 16 August 2013 11:13:43 AM
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Alan, you are pushing the labor party line ... sigh... again. Debt is good and we want to waste more.
We Australians have rejected that European socialist stupidity.
Don't believe me?
Take a look at the recent polling. Labor's polls are going south so fast the will soon be in a position worse than they were with Gillard.

If they continue with their massively negative and deceitful campaign then that is also very likely to accelerate.
Btw even with the extraordinarily harsh and what will be eventually useless, PNG solution the boats keep coming...
Posted by imajulianutter, Friday, 16 August 2013 11:39:15 AM
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Sorry but this whole article is a fail.

Get the real picture on Australian debt.
http://www.australiandebtclock.com.au/

A government does not produce anything. It only has the monopoly of force to legally steal from its citizens.

A better solution to all the government ineptitude is to have a smaller and therefore less wasteful government. Allow people to keep what they earn and don't punish them for being productive and you would have a vibrant economy.

Will this happen, No you will instead vote for the politician that promises you the most kick backs, They will borrow to give you what you want and your kids will be left holding the bill.
Posted by AdrianM, Friday, 16 August 2013 12:13:26 PM
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>> Alan, you are pushing the labor party line ... sigh... again.

>> "Debt is good and we want to waste more." <<

posted by imajulianutter, Friday, 16 August 2013 11:39:15 AM

Debt is not necessarily waste. It is if it is used for non-growth areas.

Debt for investment, especially in productive capital works, is a good thing. Especially if the works produces a satisfactory Return on Investment, like the NBN is projected to do - 7% pa.
Posted by McReal, Friday, 16 August 2013 12:25:45 PM
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AdrianM
What is your view on the Tobin Tax, which could provide the government with revenue and leave personal income untaxed?
Posted by Candide, Friday, 16 August 2013 12:29:22 PM
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Rudd the $250bn man, now has his regular apologist Alan Austin.

AA is trying to persuade us that the more than $10 000 of debt incurred by Rudd and his moronic treasurer is not so bad, and comparing it with the EU countries that have suffered under decades of socialism.

It is like saying that Joe Bloggs is not so bad as he only beats his wife once a month, where there are lots of people that beat their wives several times a week.

Considering tax revenue is about $400bn p.a. the debt is more than 50% of annual government revenue.
Posted by Shadow Minister, Friday, 16 August 2013 1:26:44 PM
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