The truth about govt. debt

Stephen Koukoulas is a well respected economist/commentator on Sky (Business) News, and this is interesting information.

If you think that the asset sales were predominantly undertaken to reduce debt, then you could argue that line. Greece is an extreme example right now to firesale government assets to exclusively pay back debt. However, that wasnt the sole motivation behind these sales, nor the influencing factor.

What is not taken into account imo, is when you privatise/sell government assets, you generally unlock additional value, through innovation, additional profits, employment, exports, and the fact that these entities would not have been paying tax under the government owned status.

Would the likes of CBA, Macquarie who owns capital city airports amongst others been able to achieve what they have under government ownership?

However in terms of sole budgetary impact, what that means now, however, is that budgetary financial management becomes and even bigger issue than it ever has, because the path to pay back large amounts of debt solely falls on the revenue raising ability of the government not on asset sales.

BTW, didnt the previous QLD & NSW governments sell assets to pay back debt. Didn't help their parlous financial state!
 
Where is he getting the extra $23B of net debt from? Seasonally adjusted?:D
Yeah, good point. Maybe adjusted for cpi at 2.8% average per year to get the equivalent value in todays dollars then add the interest and ummm.. Can't think of anything else. :p
 
evand, you just got served by facts. Unless the AOFM is a Liberal/National stooge? Yeah I suppose it must be. Plus it's Tony's Fault.

Just remember Aaron that Evand is not serious about anything he writes on Somersoft, it's all a game as evidenced by his comment to me about "not real life".

Says it all dont it?
 
That's not true. What i said to you is not carry on like a pork chop and get all upset when things are posted you dont like. Let alone get petty and personal like you have again today.

The bit about its all a game is made up by you 100%.

The fact is the Howard govt sold Aussie peoples assets to reduce debt. Its not good economic management. Thats a huge list like all the others.

Pure and simple.

And can you address the topic of the thread?

Just remember Aaron that Evand is not serious about anything he writes on Somersoft, it's all a game as evidenced by his comment to me about "not real life".

Says it all dont it?
 
Which facts?

A blind troll.....from start to finish.

1983 : Libs lose election.....Debt at 16 Billion...Labor take over and increase debt.

1996 : Labor lose election...Debt at 96 Billion...Liberals take over and pay off all of the debt.

2007 : Libs lose election......Debt nil....Over 20 Billion in cash...Labor take over and quickly increase debt to a massive 145 Billion and growing at 0.1 Billion per day.

------------

Prediction :

2013 : Labor lose election...Debt at 180 Billion !! Holy ****....Liberals take over and struggle like hell to pay firstly the massive interest bill, before even contemplating making a start on paying off the massive Labor debt......again.

It took over 9 years to pay off Labor's 96 Billion debt last time. That was with ideal economic conditions and asset sales to achieve it.

How long do you honestly think it will take to pay off Labor's 180 Billion federal debt they've racked up in less than 6 years. I reckon close on 20 years. It's the biggest scandal not spoken about in the country.

It'll be Queensland's $ 65 Billion Labor debt on steroids. If you think the Qlders are about to do it tough, wait under the Federal debacle is fully realised.

Unfortunately, this is the pain that occurs when people consistently spend more than they earn. If you aren't picking up any lessons from the basket cases in Europe about where this Labor debt binge eventually leads, then you need to go back and learn the lessons of history.


Another Prediction :

evand will say everything above is rubbish and the truth is the exact opposite of the above....but then we all know that.
 
2013 : Labor lose election...Debt at 180 Billion !! ..... It'll be Queensland's $ 65 Billion Labor debt on steroids.

A scary side fact is that the $180b in federal debt, doesn't include any of the recently revealled state debt racked up by the state Labor parties that are now being ousted.
 
Well, first off, $16B of the $180B is Liberal debt blah, blah, blah.....

But we're gonna be paying about $10B a year just in interest!!!!!

That's more than 5 times this year's forecast "surplus".

So just running along that way, the debt will still be increasing by $8B pa by still running at a modest surplus.

Who is Swannie kidding????

To pay off $180B in 20 years the budget will need to be in surplus to the tune of $15B each and every year for the next 20. How much pain will that cause, heaps.

We'll be hearing Labor squealing like stuck pigs when all their programs are slashed to try and get their money giveaway paid off.
 
we're gonna be paying about $10B a year just in interest!!!!!

Federal Labor Govt, who have decided to overspend during their tenure of 165 Billion (the 20 Billion in cash....didn't that get scooped up and spent quickly....and the 145 Billion in current debt) are currently incurring 8.2 Billion per annum in interest.

All investors here on the forum understand this. This ain't good. That's $ 8.2 Billion per year that cannot be spent on Australians.....on good things like an NDIS. The foreign banks get it instead.

Unlike all investors on here, the Govt doesn't get a tax deduction for the interest it pays on its debt.

Unfortunately, the Labor Govt has decided not to pay the interest bill, and instead use a particularly potent form of debt called capitalising the interest....so they've chosen instead to just lump the interest bill of 8.2 Billion per annum onto the debt pile and carry on regardless.

Labor are spending $ 100 million per day, every day, more than they are earning.

The interest bill of $ 22 million per day ($ 8,200 million / 365 days) is just lumped on the credit card and put on the never-never.

Labor have no plan and no intention of addressing the debt. They will not be slowing it down, nor reducing it. It will continue to grow until the Australian people get an opportunity to kick them out.

What we do have is a PM running around making further promises to spend even more, trying to buy people's votes.

We all saw this at the Premier's meeting with the PM regarding funding for the NDIS. All leaders agreed that it was a good idea. Labor leaders including the PM instantly said they were in....but didn't have any money to throw into the pot....but what they hell, they were in regardless.

The Qld premier said he'd love to be in, wanted to be in, but with $ 65 Billion worth of Labor debt to tackle, he had no clue where the money would come from. There was no room in the Qld budget....all of it is up against it to tackle the huge debt problem he's inherited from Labor.

The greenies have been given a further $ 10 Billion to set up all of these feel good departments in Canberra. That's another $ 10 Billion on the nation's credit card she doesn't have to give.

I hope everyone has had a whale of time during Labor's federal reign. I hope you all saw something for the moeny spent. We'll all be tightening our belts now for the next 20 years to pay for it. It's not going to be pretty, but it is much more palatable than keep plodding going down this same ever increasing debt path.
 
Meanwhile, somewhere in Australia, a Somersoft user is franticly using Google to come up with the quintessential argument to win us all over and win the internets. :D
 
A few years ago I got $1,000 from the government in a stimulus package. That was great because I owned about $1,000 on my tax bill!

That's about the extent of the government spending I've had immediate exposure too.
 
The fact is the Howard govt sold Aussie peoples assets to reduce debt. Its not good economic management. Thats a huge list like all the others.

So what would you propose as an alternative? Let the debt continue to grow and grow and grow? Or use assets to reduce the interest bill that will be lumped onto future tax payers?
 
Well, first off, $16B of the $180B is Liberal debt blah, blah, blah.....

No it's not Rod.

The 16 Billion in debt Fraser left to Hawke was part of the 96 Billion Keating left to Howard.

Howard paid the lot off. Gone. Vamoos. With 22 Billion in cash in the vault ready for a rainy day (read GFC looming) thank God. That 22 Billion in cash was an asset fellas. It didn't last 2 seconds when Labor got their grubby hands on the vault keys.

This 145 Billion of new debt is all Labor....soon to be 180 Billion by the time the next federal election is due.


What I never understand is why the Liberals always feel the need to come in and clean up the mess created by Labor, every time, at every level.

The Liberals to me are like this old cleaning lady with a mop and bucket....going around mopping up the Labor mess.

The public see the place is looking good after a while, kick her out and get the Labor DJ back into the room and carry on with their wild spending orgy until it gets too much and they are up to their necks in it.

This time I reckon a big vacuum suck truck will be needed to clean up the mess, her standard mop and bucket won't cut the mustard.

I guess it takes all sorts to make the world go 'round.
 
The internet needs a sarcasm symbol.

I was just writing the fist line for the Team Juliar fan club to help them along.

The $180B (come the next election) is in fact about $200B in Labor spending in 6 years.

That's just crazy.

Coming into the next election I expect Juliar to go on a promise binge to try and buy another 3 years of power.
 
Yeah, good point. Maybe adjusted for cpi at 2.8% average per year to get the equivalent value in todays dollars then add the interest and ummm.. Can't think of anything else. :p

You're probably right, I was being facetious btw. Nice misleading way of creating a fictional number to suit an argument and then basing the rest of the argument on that made up number.
Maybe he should do the same to the $96B so the Libs can claim they paid back $200B and his calculations are consistent.

Interesting bio he has too;)
 
This is all beside Costello selling 167 tonnes of our gold reserve in 1999 at a paltry $300 per ounce. Costing Australia $6b+ in funds and turning our currency into a NON GOLD backed fiat currency!!!
Geez evand, we already confirmed in some other thread that the price was AUD$460 when Oz Gold was sold! Let's keep to the facts, hey?!

Stephen Koukoulas is a well respected economist/commentator on Sky (Business) News, and this is interesting information.
The Kouk is as blinkered as many others on this forum when it comes to politics and his blogs and tweets clearly reflect this. He is very selective with his use of facts to tell a story.
 
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