This is a budget of politician-created contradictions.
Contradictions and money are a bad mix, especially for a nation state.
Politicians who don’t understand the reality of female biology are unlikely to also see economic reality.
And so it is.
The cost-of-living crisis this budget purports to alleviate with $14 billion in hand-outs to disadvantaged people has bi-partisan authors.
In fact, the entire political quad which runs Australia – Labor, Greens, Liberals and Teals are all-in on the energy price-hiking net zero frolic.
Reducing emissions is a noble aim, but our politicians are trying to do it without the technology to replace the cheap and reliable power we once enjoyed.
So in the budget they will borrow yet money for yet more windmills and solar panels while we eschew coal, gas and of course nuclear.
Instead of reducing our projected net debt of $702 billion by 2026/27, $2 billion of money we don’t have is to be gambled on “green hydrogen”, an unproven technology.
There’s never been a cost-benefit analysis of the energy transition but there’s been high costs and no benefits to people in the suburbs.
The political quad has caused the electricity price hike and the irony is Labor last night handed $14 billion of borrowed money back to people who are struggling to pay their electricity bills.
In seeking to be seen to be helping, this cash splash is likely to further drive wealth-sapping inflation.
It’s pouring petrol on the dumpster fire which the quad collectively lit.
The phrase “false economy” comes to mind.
But who doesn’t like a cash hand out, especially if you’re doing it tough.
I confess to buying a flat screen TV with the money Kevin Rudd gave me during the GFC.
It would have been better if politicians had not created the problem in the first place.
The budget predicts that inflation, now running above 6 per cent, will be halved to 3.25 per cent next year.
This is off the back of flogging mortgage holders with interest rate hikes when a key driver of inflation is out-of-control government spending and debt, factors not addressed in tonight’s budget.
Instead of leaving people struggling to pay off their homes to do all the heavy lifting in reducing inflation at the behest of the Reserve Bank, the government should have pulled the levers available to it and reduced its spending and debt.
But it didn’t.
Labor boasts tonight of a $4 billion surplus – the first by any government in 15 years.
Herein lies another contradiction.
It’s not brilliant economic management and government spending restraint but a mining boom and record income tax receipts that has delivered the rivers of cash to government coffers.
While the political quad (Senator Matt Canavan aside) demonises coal and gas, it is fossil fuels super profits that have delivered the surplus, not fiscal discipline by Labor.
How does Labor expect to keep funding the NDIS, which is now bigger than Medicare and growing at $5 billion at year, and pay down our $1 trillion gross debt if it keeps making a virtue of refusing coal and gas developments?
Killing the goose will come back to bite.
The debt is going up at a rate of $700 per second, and we’ll be paying $27 billion in interest payments per year within four years.
Net debt will be $702 billion in 2026/27.
It’s commendable to be offering cost of living relief to people who are struggling. But if governments of both persuasions had not driven inflation through flawed energy policy and out of control government spending, there wouldn’t have been the need to compound the problem by borrowing more money to help the people the government hurt.
Sadly, that’s how politics works, particularly when ideologies like climate catastrophism drive public policy.
Do you like this page?