longweekend58 wrote on Mar 31
st, 2013 at 2:24pm:
He has an economics degree plus was a senior member of the former govt who ran the economy far better. in the meantime Swan has managed the worst debt and worst deficits EVER.
longweekend58 wrote on Mar 31
st, 2013 at 2:29pm:
except it isnt counter-cyclical. that would imply a desire and capacity to return to the black, neither of which labor has demonstrated. all labor has done is what they ALWAYS do which is to spend like a drunken sailor and then ask someone else to pay the bills.
I am curious longweekend. Do you know the history of the Great Depression of 1929/1930? Are you aware of the Keynesian theory of what happens in a deep recession that affects several countries and what to do about it? The idea is that when the financial system starts failing, banks stop lending and companies start making employees redundant, there is less money in the economy. The economy shrinks. The government needs to stimulate the economy to keep it going, so people will keep spending, so there won't be runs on banks, companies won't fire as many people and unemployment doesn't rise to dangerous levels.
In order to do that, it has to use up whatever surplus it has and run a deficit. I agree that some of the Rudd/Gillard Government's policies were silly, shoddy, unnecessary and just ill-conceived, but some of the debt was necessary. Now that Australia is recovering from the GFC, it doesn't need to stimulate the economy as much. Australia is ready to pay back the debt.
I just think Wayne Swan was stupid for promising a return to the surplus because the state of the world economy was still very uncertain. There was no guarantee you'd have the same demand from China, or that you would get the revenue from the MRRT that you wanted. Wayne Swan was an idiot to be so optimistic. He should have kept his mouth shut. He should have been more conservative. When there's so much economic turmoil in Europe, you don't go around promising a surplus here.
The Gillard/Swan Government is incompetent not because they can't keep Australia's economy going, but because they keep making stupid promises. They are so indecisive. Their policies keep having to be revised. They're erratic and have no consistent direction.
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