06-08-2010, 12:14 PM
It looks like the Australian media is supporting Abbott to win the election on August 21. The bookies still have the Labor Party as strong favorites, so I'm inclined to think Labor will still win, although in the final analysis it doesn't matter which group of talking heads is elected, because they are all going to answer to their corporate masters anyway.
One issue that does my head in is the incredibly misunderstood issue of Government (public) debt. The Conservatives alarmist TV Ads stating that public debt racked up by the Government will engulf and destroy us all are incredibly dishonest.
Australia's public debt currently sits around $50 billion. The Government's broadband rollout and other spending initiatives are expected to blow it out to about $90 billion by 2013.
However this amount pales in comparison to Australia's private debt, currently $1900 billion--forty times the size of the public debt level.
Private debt is comprised of household, personal and business debt. Household debt (86% of which is mortgage debt) comprises $1000 billion (one trillion) of the total private debt. $140 billion is personal debt and $750 billion is business debt.
It doesn't take an economic genius to see that our massive increase in private debt--in particular mortgage debt (it has increased from 20 to 80 percent of GDP in the last decade, I think) is the biggest economic problem the country faces.
Former PM John Howard irresponsibly encouraged this mortgage binge, and introduced the first home buyers grant to back it up. Thousands of people who couldn't afford it jumped on the mortgage bandwagon.
Now we're left with a property market so overheated that most people need to spend half or more of their income on rent or mortgage. With all that income tied up in housing obligations, the wider economy suffers.
When the housing bubble bursts and the foreclosures start mounting, those unfortunate people will be told by the media that the cause of all their problems was reckless Government debt, because of reckless Government spending.
Steve Keen's blogs were right all along.
http://www.debtdeflation.com/blogs/wp-co...igures.pdf
http://www.debtdeflation.com/blogs/
One issue that does my head in is the incredibly misunderstood issue of Government (public) debt. The Conservatives alarmist TV Ads stating that public debt racked up by the Government will engulf and destroy us all are incredibly dishonest.
Australia's public debt currently sits around $50 billion. The Government's broadband rollout and other spending initiatives are expected to blow it out to about $90 billion by 2013.
However this amount pales in comparison to Australia's private debt, currently $1900 billion--forty times the size of the public debt level.
Private debt is comprised of household, personal and business debt. Household debt (86% of which is mortgage debt) comprises $1000 billion (one trillion) of the total private debt. $140 billion is personal debt and $750 billion is business debt.
It doesn't take an economic genius to see that our massive increase in private debt--in particular mortgage debt (it has increased from 20 to 80 percent of GDP in the last decade, I think) is the biggest economic problem the country faces.
Former PM John Howard irresponsibly encouraged this mortgage binge, and introduced the first home buyers grant to back it up. Thousands of people who couldn't afford it jumped on the mortgage bandwagon.
Now we're left with a property market so overheated that most people need to spend half or more of their income on rent or mortgage. With all that income tied up in housing obligations, the wider economy suffers.
When the housing bubble bursts and the foreclosures start mounting, those unfortunate people will be told by the media that the cause of all their problems was reckless Government debt, because of reckless Government spending.
Steve Keen's blogs were right all along.
http://www.debtdeflation.com/blogs/wp-co...igures.pdf
http://www.debtdeflation.com/blogs/