Shadow,

The link is a subscriber only page (and the usual trick of replacing theaustralian.com.au with news.com.au doesn't work). And from the portion of it you posted, it doesn't really say anything much. It was always likely going to be hostile to the Labor government (since it's from the paper that either follows or sets the Liberal Party agenda) but it seems all it can manage is a bit of skepticism and a few "what if" type questions.

In reality there's nothing dangerous about it. Even if the stimulus wasn't the biggest part of the story, it was an essential one. Interest rate cuts alone were insufficient to solve the problem, as overseas experience shows. Maybe a faster response would be better, but what they did was fast enough to keep Australia out of recession. And "if the tap kept gushing for too long" then we'd have seen a rise in inflation. We didn't.

Fiscal discipline should not be seen as an end in itself, but rather as a means of controlling inflation. Economic growth could be a lot higher if everyone accepted this.

Good onya Shadow, all you can provide to counter Aidan's intelligent economic argument is a link to an ad to subscribe to a bit of Murdoch's gutter press! I take it your economic wisdom is based on what you can get out of the pagers of a couple of trashy fish wrappers. Well done.

To become an "economic guru" like Shadow this all you have to do is;

"Would you like to become a subscriber for 50% less for the first 12 weeks†? Sign up now and access the full breadth of The Australian's content in minutes."

I advise you to cancel your subscription to such rubbish, its not worth it.

So you pay for the thoughts of Chairman Rups, good onya Shadow! None of his so called newspapers are worth two bob.

Aidan, Paul,

I know that left whingers don't like to think, and need their news predigested by tame economists that will give them suitable sound bites.

Try this from the ABC

http://www.abc.net.au/news/2011-08-08/kates---the-australian-stimulus-and-the-damage-it-caused/2829090

Talking about inflation, when the GFC stuck in late 2008 the inflation rate and the growth rate dropped whilst unemployment increased until mid 2009 when inflation and growth began to rise, reaching "normal" growth and inflation rates by the end of 2009, and unemployment began to drop.

So by your own definition, by the end of 2009, there was no longer any need for stimulus.

However, by this point only 25% of the stimulus had been spent but labor was in its element spending like drunken sailors, and did not turn off the taps until 2012.

SM,

Can you explain to us then why this:

http://www.abc.net.au/news/2014-10-28/koukoulas-why-is-abbott-considering-a-gst-hike/5845256

"The facts show that Treasurer Hockey's budget in May delivered government payments, as a share of GDP, at 25.3 per cent in 2014-15 and it will remain at or above 24.7 per cent throughout the forward estimates. By way of contrast, the last three Labor budgets had government payments to GDP averaging 24.6 per cent.

If Mr Abbott and Treasurer Hockey were in fact fiscally tight and their budget cut government payments to, say, 24.1 per cent of GDP, the level delivered in the last full year of the Labor government in 2012-13, the current tax take without hiking the GST would see the budget deficit of 0.1 per cent of GDP in 2015-16 and a surplus in 2016-17 and beyond, even with the expensive spending plans of Mr Abbott."

?

P,

Steve K, while being a well known economist is also well known for presenting politically motivated half truths.

Fact 1, Changing the GST will not make one cent difference to the federal budget, as the funding goes to the states. This is why no federal gov since Howard has considered the pain of the GST for no gain.

Fact 2, Abbott has made it clear that he will not consider changing the GST unless the states (the beneficiaries of any increase) are prepared to make the case to the electorate.

Next with respect to the budget % of GDP,

Fact 3 Expenditure by Howard was in the region of 22.5% of GDP

Fact 4 Labors last 3 budgets all missed their targets by a wide margin putting their actual expenditure close to the 25.3%.

Fact 5 Government revenues have dropped considerably over the last 4 years.

Fact 6 the Labor locked in most of their expenditure, and has spent the last year blocking every saving measure it can by the government.

Thanks SM,

What explains Hockey bequeathing the RBA nearly $9 billion which it didn't need or ask for?