Liberal party think the economy is a magic pudding

[skippy]

"THE Howard Government came to believe in "magic pudding" economics of lower taxes and increased spending during its last years in office, Tony Abbott says.

"The one thing that I am inclined to suggest might have changed or developed over the latter part of the Howard government's term, I think we did start to believe in magic pudding economics," Mr Abbott said"


http://business.smh.com.au/business/lib ... -9qjm.html

This really say's it all, the Libs are now admitting they had no idea.

[Jovial Monk]

bwahahahaha

And People skills also said the Rodent should have apologised to the Stolen Generations.

[Hebe]

I wonder if the Mad Monk is jockeying for the leadership.

[Jovial Monk]

He has lots of People Skills, you know

[Hebe]

So he says.

[Jovial Monk]

Dumb as a Barbary Ape is my guess, but then I think Costello lower than slime, Howard a rat and DT dishonest, so who am I to say?


Muwahahahahaha

[Uncanny Valley]

"The fact we could have lower taxes, higher spending and bigger surpluses for about five years - in other words, we could have a magic pudding - led some people to think that thrift, prudence, responsibility had somehow become irrelevant. It's never irrelevant, and I fear that we're somehow going to discover just how relevant those old fashioned economic virtues are in the next few years."

Superb quote.

I typed that up and bunged it on a few notice boards at work last fortnight.

Can I just point out that in the original "quoted" bit by Skippy he is quoting the article, not specifically Tony Abbott. I'm sure that was only an accident that it looked like you were quoting Tony Abbott.

I've only read the quotes, not seen the interview. I'd be interested to know how much [what "weighting"] he is talking about the past government, and how much he's talking about business leaders, mums and dads, and morons in general.

[JW Frogen]

I work with a woman who has one fine dam pudding.

Magic even.

[Jovial Monk]

This is a much more detailed view (with lots of errors I will discuss below:

More starkly, the Treasury reported that from the 2004-05 budget to the 2007 election, the China boom and a robust economy had added $334 billion in windfall gains to the budget surplus.

Of this, the Howard government spent, or gave away in tax cuts, $314 billion, or 94 per cent. Again, for perspective, this is the size of the entire annual economic output of South Africa or Denmark. Effectively, the extra revenue from the commodity boom has been spent or provided as tax cuts, summarised the Treasury in its summer 2008 Economic Roundup. The study compared Howard's fiscal policy with that of that touchstone of recklessness, prime minister Gough Whitlam.

Recent Howard budgets resembled "Christmas night at the pirate cave", in the phrase of a former budget analyst with the Treasury and Department of Finance, Stephen Anthony, of the consultancy Macroeconomics.com.au. . . .More starkly, the Treasury reported that from the 2004-05 budget to the 2007 election, the China boom and a robust economy had added $334 billion in windfall gains to the budget surplus.

http://www.smh.com.au/national/fiscal-f ... tml?page=6

Look at that figure and weep! $314BILLION dollars just *given*away* 04/05 to 06/07! Given away in numerous spending (read: pork barreling)) and tax cuts to the wealthy. Really, one of Peter Hartcher's first errors is that the China (and India) boom and Howard's buying of elections started in '01.

What is not discussed, at least in the excerpt published by the SMH, that all these tax cuts and pork barreling happened in a boom! In a boom the budget should absorb money from the economy in the form of tax revenue to stop the boom starting to turn inflationary. The idiots just used their magic pudding to feed money into the boom, causing 10 interest rate rises on the trot! If mining was not as capital intensive as it is now inflation would have been much much worse.

Hartcher talks about the Hawke/Keating govt introducing major reforms which is true and states that the Howard govt continued these reforms. Pardon? Apart from the GST which is just a revenue raising measure (and which led to the C/w increasing its take of tax to GDP at the expense of the states) what reform did they introduce? Their IR reforms affected only a handful of workers, their FTA with America saw our balance of trade decline sharply--in a mining boom!

Finally I ask you: if the $390Bn mining boom revenue 2001-7 had been saved, how much better would we be today? No need to borrow, our Sovereign Fund could finance companies like OzMinerals and Rio, it could have made investments overseas, strategic investments that would bring in wealth etc etc. But we had a bunch of clowns, amateurs, smirkers and magic pudding eaters who fell down on their duty, lived in lotus land and failed to manage our economy!