Rudd government's debt as a proportion of GDP flawed

Like most Australians at the moment, I do think about the amount of debt the government is running up. On 19 May, the Prime Minister said his target was 13.8% of GDP or $300 billion, expected during 2013/14.

For this percentage to be realised, GDP would need to grow to $2.17 trillion. In the 2009/10 budget, the government is estimating GDP to be $1.18 trillion for 2009/10, which is a fall of 1.52% from 2008/9.

For GDP to increase to the levels claimed by the Rudd government, it would need to increase by 45.75% or 11.43% per year. Looking at the graph to the left showing GDP growth around the time of the last recession, these figures are unrealistic.

Based on history, it would not be pessimistic to claim GDP growth of 5% a year following the current financial crisis. Based on this rough estimate, GDP would be $1.42 billion in 2013/14 at which time the $300 billion claimed by Rudd would represent 21.2% of GDP.

Debt would be less under the coalition

Brendan Nelson's refusal to say how much a coalition government would go into debt for during the global financial crisis is a little hypocritical after the coalition mocking Kevin Rudd for not saying the word "billions".

During ABC's Q&A program, Nelson said:

It should be obviously less than it is at the moment and the quality of the
spend should be quite different from what it is.

Does that mean the coalition would go into $314,999,999,999 of debt?

It's OK to send our staff first class, the last government did it

Kevin Rudd's defence of paying $60,000 to send four treasury department staffers to London in first class by claiming the previous government did it is a complete and utter farce.

It cost the government $15,000 per person to send these staffers to London. Looking briefly at airfares, a trip in economy class would cost $5,000 each while business class would have cost around $7,500 each return. Would it have hurt them to fly in business class and save the government 50% of the fare?

Was a cost-benefit analysis done on business vs first class? Probably, only to find that "the benefits to staff travelling in first class at a cost of 200% over business class outweigh the cost".

I suppose a saving of $30,000 is nothing when the government is looking at spending up to $315 billion in borrowed money.

West Australian hoon should be gaoled

Serial tool, Ryan James Joseph, 20 of Perth should be gaoled after being fined for his 6th hoon offence. Joseph's other previous driving offences include driving while disqualified and reckless driving.

Despite the vehicle used by Joseph to perform the latest burnout being registered in his girlfriend's name, a magistrate ordered that it be confiscated and crushed by police. Prior to being siezed by police, the vehicle had already been trashed, allegedly by Joseph.

At the time Joseph committed the burnout offence, his girlfriend and 14 month old child were in the vehicle.

Speaking to the media, WA Police Minister Rob Johnson said: "It just shows you the irresponsible type of person that he was and I am glad that he is not only losing his vehicle but he will be losing his licence and I hope that he will be fined very heavily."

Does the minister honestly think that taking this guy's car is really a deterrant to him - he trashed it before police collected it. It shows that he couldn't care less what happens to it. As for losing his licence - the hoon has already been busted for driving whilst disqualified in the past, what will stop him from doing it again?

Add to that a heavy fine, do they really think it will deter someone with the mentality of Joseph?

The best way to deter Joseph and prevent him from driving is for him to be imprisoned for the duration of his disqualification. It is clear he has no respect for road rules and orders of the court.

Image Credit: (c) Perth Now

Home quarantine works, if people actually do as they are told

I read with disgust how some of those ordered into home quarantine are flouting health officials orders, placing the vulnerable in the community at risk. Even more startling is that health officials claim there is nothing they can do to ensure people obey the orders.

Why bother issuing orders if people don't have to comply with them?

Why are these people so selfish and thinking only of themselves?

These same selfish people are probably going out into the public, getting up close and personal to people, coughing on them, shaking hands after they have coughed or sneezed without washing them.

How would those who are ordered into quarantine feel if they spread the virus to someone undergoing cancer treatment, someone with AIDS or a respiratory disease? Would they even care?

Image Credit: Zelda, Wikimedia Commons, PD

NSW Health messed up on the Pacific Dawn

The NSW Health department has completely messed up on its handling of AH1N1 swine influenza aboard the Pacific Dawn.

When the Pacific Dawn docked in Sydney on Monday, health authorities believed that those with flu-like symptoms on board were suffering seasonal influenza as the ship had not been to any affected countries.

Passengers of the ship have condemned the lack of information from health authorities.

Even more strangely, a child who was aboard the Pacific Dawn attended school for half a day before being told he should be home in quarantine.

While the death rate of A/H1Nq has been fairly low thus far, the handing of the Pacific Dawn by NSW Health shows serious flaws in its handling of potential pandemics. What would of happened if it was a highly pathogenic and contagious disease?

Once again, the NSW government has screwed up. Congratulations Mr Rees.

Image Credit: US Center for Disease Control, Public Domain

Conservative economic management

It is a common view in Australian politics that the conservatives are better economic managers than Labor. Is this because they tax more and spend less?

Looking at the record of the Howard government (because the budget periods from 1995/6 to present are easiest to get data for) - it seems that it increased taxes while spending less on core services like Defence, Health, Education and Transport/Communications. While the Howard government paid off the $96 billion in net debt it had at its first budget in 10 years, it neglected core services and the challenges Australia faced.

One only has to use health, education and transport systems in Australia now to realise that they have deteriorated significantly in the past 15 years. Now, before my neo-conservative friends say "that's a state responsibility", they need to think about where most of the money comes from for these services.

While it is important for the government to run budgets in the black, it is more important for the government to be able to provide core services to its taxpayers.

Has the Howard government's underspend on infrastructure helped the economy? No, because now we only have to spend what should have been spent on the first place. Thanks Mr Howard.