The Australian Budget was released this week – and there was hardly any surprises.
There are lot’s of commentaries out there – so I will not be be too deep.
– We had to have this kind of Budget – even last year – as there is NO debt emergency in Australia in comparison to the world.
Even the mania with Budget Surplus is a bit an obsession. It is like if we were 4 friend paying a $100 meal….and each of us put $30 instead of $25 – Just put $25.
So it is a mildly good Budget…but as usual misses the mark.
– This budget pushes a lot on the small enterprise. Nice, but no small enterprise will turn around a country (think about it – BHP can hire 1,000 easily enough…you need 333 small companies to hire an extra 3 people to reach the same result – definitely with less efficiency and profits.
– All the items that provoke a serious structural imbalance for the society (Super tax offset for ultra rich, negative gearing etc) have not be touched.
Practically this Budget relies on growth to tackle the country debt.
It will not succeed, as it did not tackle the serious issue. The idea is that if we get the desired growth level Debt/GDP ratio will peak at 27%.
But the growth does not pick up, the growth level debt/GDP will peak at over 30 – still not an issue in the global context, but it will seriously endanger the AAA rating of Australia with serious consequences (increase in yield so even more difficulties in restricting the Budget growth.
But the issue is in our three year political mandate….the Australian governments always look at the next elections and not at what is best for the country in the long term!
PS Did you notice the new media trend? Scaremongering campaign before the Budget…and then a not so bad Budget so we are all happy lambs (to the slaughterhouse)!
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