Good lesson in basic (conventional) economics. And or, the boom and bust nature of conventionally run economies?
The current problems started in the Howard years, when the then current boom was basically squandered, writing out cheques for folks who'd never ever been entitled to Govt benefits before!
And or, as tax breaks for folks who simply didn't need them? Creating in the process a structural deficit!
Further compounded by tax avoidance on a hitherto unknown global scale.
We've inherited a tax system that had its beginnings with Westminster.
And has since then had layer upon layer of complexity added. Moreover, we apparently collect somewhere around 150 different taxes. With at least 40 of them impacting on the price of a loaf of bread, and others cascading through our manufacturing industries, driving up the price of everything we make here! However, only around 11 of them collect most of the revenue!
We churn money by taking a fuel excise and then returning some of it as rebates!
The rivers of gold that came from mining boom mark one, ought to have been invested in a wealth earning sovereign fund, and income earning assets ought to have been retained instead of sold off, to manage a short term cyclical downturn.
Had we been pound wise instead of penny wise, we would not now be discussing where and what to cut, but rather where to invest the surpluses?
Our tax system is basically broken and ought to be completely jettisoned, and replaced with a single stand alone, unavoidable expenditure tax.
This would allow firms to keep the money currently ripped from the bottom line, just to cover tax compliance costs, around 7% averaged.
It would also act to stop entities like Google and Apple from using extremely sharp practise to avoid a fair share.
Arguably, and expenditure tax can be set at a lower rate than the returned compliance costs, in a win/win outcome for business and the economy.
Incidentally, if anyone wants a (pro bono) more comprehensive explanation of my expenditure tax proposal, give me an Email address.
Rhrosty

The tax system is inarguably far too complex for regular folk, however I have no doubt that lawyers & bean-counters find it quite profitable as is. Unravelling the present mess would, under ALP or LNP gubmunts would necessarily involve a bunch of legal leeches ... how does one convince those grubs to do something, the end result of which has the potential to cause immeasurable financial loss to their erstwhile compatriots ??

In theory at least, the GST was 'supposed' to render the end of virtually all other taxes. What we saw in practice was typical failed lawyer turned male bovine dropping politician double-speak. Sure they got rid of 'some' taxes, but they also decided to describe a whole raft of other taxes as variously a 'duty', 'impost','levy', 'subscription' etc etc. Further down the track, we see not only brand new taxes & what-all springing up to fund the utter ineptitude of officialdom, but they also conspire to raise the GST. Note particularly that every other entity on planet earth that has as much as a nodding acquaintance with budgets encounters situations where income doesn't amount to what was predicted. Difference is that other than the parasites infesting our various parliament houses, the relevant bean-counters look for ways to economize. Clearly the word 'economize' was omitted from the bloodsucking parasites handbook.

to be continued

continued

How many employees, when they find their paypacket isn't covering all the bills, wander off to the boss and demand a payrise ?? Of course not, at least not if you expect any more money from that particular source. What about the mechanic who fixed your car last month. Does he front around and hold his hand out for another thousand bucks because he can't pay his bills ?? Obviously not if he values your custom he won't. Maybe you get fruit & veg from the nice greek down the road, but this time he says 'youa gotta givva me 'nutha fivty fora lasta week'. Dunno about you, but I'll be finding another place to shop. Why then should we accept elected representatives who merrily squander the money we entrust, and then come looking for more, not only once or twice, but time after time after time immemorial ?? Its not as if they lack resources, we also supply whole armies of staff, machinery, every conceivable resource known to mankind & still more, yet year after year they stuffup miserably and come back after more of our hard-earned. ENOUGH I SAY !!

Rhosty

Nice theory, shame about the facts. IMF data show the Australian government’s structural position switched from deficit to surplus in 1997, stayed in surplus until 2007 and has been in deficit since.

http://www.imf.org/external/pubs/ft/weo/2009/02/weodata/index.aspx

Rhian, that is stunning. I think the link to the specific information is http://www.imf.org/external/pubs/ft/weo/2009/02/weodata/weorept.aspx?pr.x=92&pr.y=10&sy=1980&ey=2010&scsm=1&ssd=1&sort=country&ds=.&br=1&c=193&s=GGSB&grp=0&a=

It shows the Howard years as being the only years when we have been in structural surplus since 1980. It ends abruptly in 2008.

Why hasn't the media picked this up amongst all the butt covering by the bureaucrats?

This really is the worst government in 30 years, and by a long shot. The structural deficits are far worse now than anything previous in the IMF dataset.

Yes, Graham the turnaround is stunning

you picked the series in dollars of the day, which was always going to make the current deficit look big, but even as a percentage of GDP it was a record in 2010:

http://www.imf.org/external/pubs/ft/weo/2013/01/weodata/weorept.aspx?sy=1990&ey=2014&scsm=1&ssd=1&sort=country&ds=.&br=1&c=193&s=GGSB_NPGDP&grp=0&a=&pr.x=63&pr.y=16