The media, has been scaring us about this country facing a future of debt, deficits and public penury .

“A decade of deficits spells a bleak future for Australians,”

In fact, the bond market rallied on the day of the announcement of a $12 billion black hole.
Australia is one of only eight nations in the world rated ‘AAA’ by all three major ratings agencies, this makes our bonds highly sought after.

Big funds in London and New York look at Australia and see a South Seas Switzerland – strong public finances, solid growth, low unemployment, low inflation, good yields and politically stable.

The Wall Street Journal, last year described the Australia Government’s ‘AAA’ debt one of the few safe haven investments left in the developed world.

The shortfall in the budget is about 1% of GDP.
Imagine you’re a two-income household earning about $200,000 a year. You’ve done the household budget. You forgot to include Jasmine’s school trip, which is going to cost $2,000. That’s 1% of your household GDP. Well, that’s the position Australia is in.

And what about THE DEBT? Another analogy: Your household income is $200,000. Your mortgage is $20,000. You are no worse off than Australia's economy. Are you worried?

More perspective. Australia has an unemployment rate of 5.4%. In the US, the economy leading the world out of recession, unemployment is 7.7%, in Canada 7.0%, in the European Union about 11%, in Spain 27%.

Since the GFC Australia has gone from 15th to 12th largest economy in the world. In that time, 900,000 new jobs have been created. This is a period when in much of the developed world, millions of jobs have been lost and millions of lives destroyed.

Now what would have happened to our budget position if the government had taken the austerity route –Tens of thousands of people would have been thrown out of work. More unemployed, more social spending. Fewer employed means lower consumer spending.

A thought filled thread.
And one if followed to its conclusion will remind us, media is privatly owned and used first, to put the owners views not the truth.
We are in for a ride, after Labors unavoidable loss, and the unloading by Abbott of his non core promises, we will see voters reject politicians, more than ever before.
This will see Labor needing to climb mountains, to just get back to its once base.
But it will, however it too, will not undo much of the Liberals actions, it is always so.
We how ever will not fall over or stall in our growth, we know, the thinkers of us, we prosper under both forms of government.

Thank you, Robert,

You note -

"And what about THE DEBT? Another analogy: Your household income is $200,000. Your mortgage is $20,000. You are no worse off than Australia's economy. Are you worried?"

Most people with a mortgage would agree with your premises, but usually their mortgage would be somewhat larger than $ 20,000. Try this scenario instead:

" ..... Your household income is $ 60,000, and your mortgage is $ 200,000. You work in manufacturing, or casual tutoring at a uni. Are you worried ?"

Bloody oath.

But let's keep smiling :)

Cheers,

Joe

It has been a unique experience, watching a government lurch from one stuff-up to the next, mishandling every single opportunity to present policy, and failing to manage any aspect of their portfolio with competence and precision. All against a background of relative financial stability, and an economy that is robust enough to survive a few minor sniffles with the minimum of medication. An object lesson in how not to approach government.

Part of the blame has to be allocated to the Green and Independent brigade, who have run interference on every single initiative, and not once been told to come to heel. But again, this only underlines the lack of management skills available to Ms Gillard and her team. Much can be attributed to the manner of her accession, which was an act of pure political bastardry. Failing to follow this up with a clear victory at the election fatally highlighted her inability to command the respect necessary to control the marginal ferals.

It is in this context singularly unfair to blame the country's mood on the press, who have hardly had to raise a finger - the incompetence stories simply write themselves. And keep on coming. The journalistic gift that simply keeps on giving.

And I defy any journalist in the country to come up with a story that throws a favourable light on the present government's management capability - even their "good" policies have been mangled, mismanaged and mishandled.

Whatever the financial fundamentals may be, they are not going to be a driver of the election result. All-round loss of confidence in absolutely anything the government says or does, is what will guide the outcome.

The following may be of interest:

http://newmatilda.com/2013/04/30/calm-down-about-deficit

Robert
So according to your perspective, everything that everyone in the country earns and produces is the government's to spend as it pleases? The country's wealth actually belongs to the government? It is ridiculous to say the government has wasted too much money - it could always have wasted more, like so many other states have done?

You see, the only reason Australia's finances are in as good shape as they are in, is because of all the people who *don't* share your Animal Farm theory that people are just some kind of chattel belonging to the government

Have we noticed in relation to media most of us think it is biased?
Take the ABC some claim it is the home of greens spin, others say Labor and y4es Liberal.
It is true it has produced sitting members for most sides.
But as is the case for some here, media news manufacturing, has produced a blindness.
And a bias, this country remains, under Dillard, better not worse of than it was when Labor came to power.
GFC taken in to consideration, and the elephant in the room, conveniently ignored , high Australian dollar.
In a short time, at winters end,we enter another form of winter, Liberal government.
The complaints about our country have far from a white knight coming to the rescue.
Abbott comes, with very few answers.

belly,

How can you know what Abbott will do?

Sure, i am worried about the future, but it is not Abbott's fault that Labor was so poor that he needed to do little. In any case,it was he who led the Coalition's revival, so he obvioulsy has the political skills.

Everyone knows that the Coalition is more inclined to balance the books during the poliical cycle, but he needs to be given time to show his credentials before the criticism or praise is justified.

Personally, and despite my belief that Aust's easy days are over, i feel he has the intellect and drive to do much better than some people think, certainly much better than Kevid Dudd and Julia Gillard have done.

Lexi, there is a lot of confusion about the debt.
The government points out as you have done that the debt is small in
terms of the GDP.
What the problem is, as they have discovered in Europe, not the size
of the debt but whether they can generate enough income to repay it plus interest.
With a falling GDP and an economy approaching zero growth the possibility
of repaying the debt plus interest is receding like some distant galaxy.

Both parties are, as far as the public can tell, quite confident
that they will be able get out of debt due to increasing growth.
That is why economists recommended printing money on one hand and
austerity on the other. One of the recurring themes is that they do
not understand why neither technique is working.

The only economists that seem to understand what is happening are
those that acknowledge that it is not a monetary problem but a problem
of the cost of energy.

It all reminds me of that not relevant saying;
"If you owe the bank $1 million you are in trouble, if you owe the
bank $100 million then the bank is in trouble."

Juliar's Labor has borrowed on behalf of every man woman and child in Australia more than $10 000 each in only 5 Years, which has now fallen on the shoulders of the Coalition to repay.

I personally would advocate the sale of every non core asset including any remnants of Telstra, Quantas, the power companies, NBN etc, and let the government no longer compete with business and focus on public service delivery only.

Chris Lewis Gday, how old are you my friend?
What do you base you own thoughts and opinions on?
Any chance seeing what happened in the past, and long term viewing of people plays a roll.
Not every comment has merit.
If you search say Rechtubs recent posts, just as an example, you will find he said the NDIS was something along the lines of suport for freeloaders!
Now Lexi gives us a link, to just as biased a media as the anti Labor ones.
A truth is avoided here.
Read the last line in Pericles post, first in this thread.
Forget policy, voting Australia has, it will play only a minor roll.
See however, and it is worth unbiased thought! the dislike for Dillard and her supporters.
Understand along with brilliant NDIS, NBN, carbon capture clean energy we got cash for clunkers and a total white wash of the knifing of a first term PM.
Liberals can afford to say nothing, do nothing, just wait and let the victory fall in their arms.
I personally thank Dillard for her brilliant but late, delivery of the NDIS by cornering Abbott, but wounder if it was Bill Shortens work, she lacks the ability to sell iced drinks in the desert.

Belly, i suppose i am being an optimist to some extent.

I too remember some of Abbott's dodgy comments over the years where his words did have ramifications for his image.

However, i view Abbott as a fairly decent and smart bloke who has the ability and opportunity to provide leadership on a new level. I base this on his visits around Australia where he has met many people and businesses of diverse backgrounds,and some policy positions (albeit fluctuating) which even offended the orthodoxy from his own side of politics. I actuaally see potential in this style.

Time will tell, however. I suspect Aust governance is going to get even harder.

I don't know about you Belly, you say you're a strong member of the Labour party yet you are always bagging them. Sounds like your are more of a follower of Abbott and his cronies - certainly you'd be expelled from any branch that I'd have anything to do with, if for no other reason for treason towards the party and the branch.

If you support Labour as you claim, prove it by sticking up for them, instead of continually putting them down. OK.

misanthrope,

Perhaps "Labor" ain't what they used to be.

Perhaps some people have principles.

Perhaps some parties (who ain't what they used to be) should listen to constructive criticism from their "supporters".

OK

As usual, I'm with you on this, Poirot.

When the PM challenges Abbott to a finger-wrestle, and demands to know if he will support policy x or y, all he has to do is say, "Of course, as long as it turns out that there's money in the Treasury for it. Can you assure the Australian people that there will be ?"

And what can she say ? He's on a winner either way.

Cheers,

Joe

I cannot believe how stupid humans are.Private banks now create money from nothing as debt to equal increates in our productivity + inflation + pop increases.

Unless we get back to Govt banks who create money from nothing to equal increases in productivity etc,we are totally stuffed.

This means the more growth we have,the more debt we incur.The debt can never be repaid unless we sell off resources and energy for next to nothing.

China is now accessing cheaper resources/energy from Africa and we are going the way of Cyprus.

Labour supporters always find a way to justify outright wastage. Despite years of National Broadcasters apologist they are still in for a hiding. Our postion on the economic ladder is very much despite the Government as the voters know.

I am blue in the face. I wish I could believe in representative democracy in this country. It simply doesn't exist.
Honestly, how many parliamentarians in your lifetime have behaved or acted in your or even the general populace's interests? Put simply, anyone you vote for is bound to follow the party line.

Take the sell-out of Australia starting with the Hawke regime's adoption of the neo-liberal free market mantra. Who when they voted, knew that they were giving him a mandate for such a drastic adjustment to Australia's social and economic welfare?

Privatization; who has seen a reduction in the cost of essential services?

Opening the country to foreign direct investment; well basically anything which used to turn the country a profit is now turning a profit for some outsider including the much favoured mining industry.

Floating the dollar, for god's sake we don't even control the value of our own currency, ask any Australian based trader about the complications this causes.

Smaller Government, well they've just about outsourced their own necessity, why do we allow them to pay themselves for not actually representing us.

De-regulation has locked Australia into an already passé economic model which is widely recognised as having comprehensively failed the the wider global community. Fortunately many countries have escaped the yoke of IMF and World Bank austerity and have now regained democratic control of their social and economic futures. There are signs of hope.

Until our politicians understand and are prepared to address this reality they will continue to swing around with one foot nailed to the floor and take the also naïve populace with them.

Economics is actually quite simple; 2+2 makes 4, Add, subtract, divide or multiply by any other number and it will alter the equation but no amount of hype will make the least difference to the science.
Much of the world and Australia sadly is caught up in the hype.
Den 71

What we can blame the press for, however, is their abject failure to provide education on "what it all means". This thread is a salutary example.

Some of the comments here defy belief, in their complete lack of understanding of how the world of banking and commerce actually works, and how its activities affect them personally.

DEN71, for example, is "blue in the face" thinking about our representative democracy. Which is all very fine, I'm pretty concerned about it myself. But...

>>Take the sell-out of Australia starting with the Hawke regime's adoption of the neo-liberal free market mantra.<<

These policies have provided the average Australian with a level of financial comfort and a lifestyle that they could not have even dreamed about before the Hawke/Keating team did their job.

>>Privatization; who has seen a reduction in the cost of essential services?<<

Privatization, in any economy, is designed principally to free the government from expending untold amounts of taxpayer dollars on enterprises of which they know and understand diddly-squat. So a more accurate measurement would be, how much taxpayer money has been saved, since the privatization?

>>Opening the country to foreign direct investment...<<

That's a doozy. Where else could the money to develop our industries - particularly mining - have come from? We could not have borrowed it all, our economy was simply not that big.

>>Floating the dollar...<<

Boy oh boy. Surely you have noticed the problems that a fixed exchange rate can create, then exacerbate, in places like Ireland, Spain, Portugal, Greece, Cyprus etc...? Or the decade-long row over China's central control over same? Allowing any currency to find an appropriate level in relation to other countries is fundamental to stability, not counter to it.

>>De-regulation has locked Australia into an already passé economic model<<

If it is passé, what has replaced it, pray?

>>...many countries have escaped the yoke of IMF and World Bank austerity and have now regained democratic control of their social and economic futures<<

Like, who?

An absolute farrago of misapprehension, all in one post.

Classic.

">>...many countries have escaped the yoke of IMF and World Bank austerity and have now regained democratic control of their social and economic futures<<

Like, who?"

Zimbabwe?

Thank you, Pericles, for some hard-headed sanity at last.

Joe

Pericles
Thankyou for your for your opinion piece in response to mine. Time will tell.
Den 71