This is the latest line Rudd is running, via the ABC:
The Opposition says the spending package is badly managed, will push up interest rates and leave the country with too much debt.
Prime Minister Kevin Rudd has used the Opposition’s stance to again attack Mr Turnbull’s political judgement, accusing him of being at odds with the consensus from the recent G20 finance ministers meeting that spending should continue.
Firstly, Rudd’s package has gone well beyond the G20 consensus in both its size and in the level of waste being incurred. Secondly, the Australian economy is performing completely differently from the rest of the G20 due to international trade. So unless Rudd thinks he is presiding over the socialist mess that is the British economy, then he should wind back the spending.
UPDATE
Michael Stutchbury on the unthinkable and why Rudd is totally wrong:
Even the Greens are worried that the government is spending too much….First, Australia does not rely heavily on manufacturing, which globally collapsed in the wake of the financial crisis. Second, Australia’s pre-crisis resources boom retained substantial momentum, which has been quickly rekindled by China’s recovery…third, the front-loaded fiscal and monetary stimulus delivered by the government and the Reserve Bank has gained more “traction” than in most other economies.
…Group of 20 finance ministers and central bank governors…agreed to G20 countries having different “exit strategies” for unwinding their “extraordinary fiscal, monetary and financial sector support”.
We are the first to come out of the downturn so we should be the first to wind back our ‘stimulus’ package. Simple stuff, but there is a growing suspicion in the MSM that the cash-o-rama is becoming more about Rudd’s personal glorification than helping the economy – with school plaques all across the country honouring his generosity in spending other people’s hard earned money. So kind…
The UK Telegraph has written an article outlining how modern governments are repeating the mistakes of depression era governments in exacerbating the economic downturn through the massive expansion of the public sector:
Barack Obama is committing the same mistakes made by policymakers during the Great Depression, according to a new study endorsed by Nobel laureate James Buchanan.
One could easily substitute Obama with Rudd. For instance Julia Gillard during here trip to the USA likened the ALP government with Obama’s ‘progressive’ administration.
…economists Charles Rowley of George Mason University and Nathanael Smith of the Locke Institute, claim that the White House’s plans to pour hundreds of billions of dollars of cash into the economy will undermine it in the long run. They say that by employing deficit spending and increased state intervention President Obama will ultimately hamper the long-term growth potential of the US economy and may risk delaying full economic recovery by several years.
The study represents a challenge to the widely held view that Keynesian fiscal policies helped the US recover from the Depression which started in the early 1930s. The authors say: “[Franklin D Roosevelt's] interventionist policies and draconian tax increases delayed full economic recovery by several years by exacerbating a climate of pessimistic expectations that drove down private capital formation and household consumption to unprecedented lows.”
Compare the success of Australia’s fiscally conservative ‘Premiers’ Plan’ during the depression against the fiscal expansionism of FDR and his ‘New Deal’.
