In Stranger in a Strange Land, Robert Heinlein cautions against dumping a leader you don’t like, just because you don’t like them. Make sure whoever’s going to replace them isn’t even worse, he warns. Americans are getting an object lesson in Heinlein’s warning: they swapped Trump’s mean tweets for Biden’s utter, demented incompetence, nay, malfeasance.
As a consequence, in just two years, America’s economy has gone from boom to bust. From energy independence to fuel shortages and prices at record highs. The country is even reduced to using emergency military flights to stop American babies from starving.
But, hey, at least they don’t have the mean tweets any more.
Australian voters are about to learn the same harsh lesson. Certainly, the Morrison government had done little to earn re-election, and a great deal to deserve being dumped, but it looks like we’re going to learn pretty quick that the alternative is a lot, lot worse.
Labor risks putting the country’s triple-A credit status in danger if it races to implement nearly $45bn in “off-balance-sheet” election promises, one of the top rating agencies warns.
This is the sort of thing Labor does, repeatedly: make grand promises, but shift the costs off the books. It’s what Julia Gillard did with the NDIS, by pushing most of the spending out past the forward estimates, meaning that it wasn’t included in official costings. Now, Gillard is long gone, but the monster she birthed is on track to become Australia’s single biggest budget behemoth.
For all his talk of leaving his red-ragging Marxist past behind him and remaking himself as a sobre fiscal conservative, Albanese’s coming straight out the gate with some good ol’ Labor big-spending. Including more bennies, of course.
As Anthony Albanese flags the potential for additional cost-of-living support […] The Prime Minister has promised a $10bn fund to increase social and affordable housing and a $20bn “rewiring the nation” fund to modernise the electricity grid and build transmission infrastructure. In addition, the government has also pledged a $15bn “national reconstruction fund” to revitalise manufacturing.
Of all of them, only the last has even the remotest possibility of making sense, so long as it isn’t just trousered by the same clowns who’ve left us so badly exposed by sending all our manufacturing off to China, anyway. The rest could be largely fixed by dumping two damaging mainstream political obsessions: mass immigration and “Net Zero”.
The housing crisis is a simple case of increased demand, driven by importing the equivalent of the population of Adelaide every few years, and dumping them in Melbourne and Sydney. The only reason the electricity grid needs to be “modernised” is because of the exponentially increased stress imposed by unreliable, intermittent “renewables”.
And it’s all going to come with some hefty costs.
While such spending commitments tend not to appear in the underlying cash balance, Mr Walker said the rating agency would include them in its assessment and that they could “pressure the AAA rating” if the spending was frontloaded […]
Australia is one of only nine countries to hold a AAA rating from all the major agencies: S&P, Moody’s and Fitch.
Such a ratings downgrade would have some very big effects. Mostly, it would make it more difficult for the government to borrow, and cost much more when it does.
But, it must be said, Labor is not the first government to hide its big-spending by disguising them as “off-balance-sheet” items.
Independent economist Saul Eslake said the off-budget accounting for investments in financial assets to fund spending did not have “any basis in accounting standards”, and that mostly it was a way for successive governments to keep the cost of some commitments out of the public eye. But Mr Eslake said it would be virtually impossible for Labor to spend $45bn in the space of two or three years, particularly given shortages of labour and materials.
The Australian
Eslake clearly underestimates a Labor government’s ability to blow the budget to kingdom come in record time. Does he not remember Kevin Rudd and Wayne Swan?