The Forum > Article Comments > Fiscal stimulus: handouts v cuts > Comments
Fiscal stimulus: handouts v cuts : Comments
By Saul Eslake, published 3/3/2009Fiscal policy must play a larger role in dealing with the current economic downturn.
- Pages:
-
- Page 1
- 2
-
- All
Lowering interest rates is OK for spendthrifts and the 25% of Australians with mortgages, but there are actually a lot more people out there depending on reasonable interests rates to survive and keep themselves free of government handouts (i.e. taxpayer handouts).
The call for and the crowing about lower interest rates when they occur is stupid.
As for using fiscal policy to get us out of trouble, just look what happened when Japan decided on that course: it still hasn’t recovered from it’s the 1990’s crash, whereas other countries have. And what about the US, drawing out its recovery until after WW2, while Australia and the UK were beating the Depression in 1933, and recovering in 1938, thanks to balanced budgets and cuts in spending.
Government spending and going into deficit as Ruddy Labor intends will not work. Tax cuts to get the market working, a balanced budget and cost cutting, except for some large and needed infrastructure works, is the only way to go.