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Wayne Swan warns of...

Discussion in 'The Economy' started by Tropo, 17th Apr, 2009.

  1. Tropo

    Tropo Well-Known Member

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    Wayne Swan warns of budget shocker

    WAYNE Swan has warned of a horror budget, seizing on China's slumping economy to highlight the threat to the deficit and growth.
    China yesterday reported its lowest growth rate since it started publishing quarterly growth figures 15 years ago.
    The 6.1 per cent rise is much greater than any developed economy, but the figure is well short of forecasts made by either the Chinese Government or the International Monetary Fund and less than half the 13.7 per cent growth achieved in 2007.
    The Treasurer, using his most pessimistic language to date to describe the budget position, said China's growth report "provides stark evidence of the impact of the global recession on the mining boom, which supercharged Australia's economy in recent years".
    "The simple fact is that a global recession, and deep downturns for our key trading partners, make it certain that our own forecasts for growth and revenue in the budget will be substantially worse than in UEFO," Mr Swan said, referring to the updated economic and fiscal outlook published by Treasury just two months ago.
    more ....Wayne Swan warns of budget shocker | The Australian
     
  2. Chris C

    Chris C Well-Known Member

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    So those estimates were wishful thinking... $50B+ deficit here we come!

    It was only a few months ago that the government was suggesting that debt could reach $200B. I'd hate to think what it will explode to if they used some more realistic figures that include key points like the fact that both Australia and the developed world are all heading into a synchronized recession that to date has shown no real signs of bottoming!

    Does anyone know what the interest payment would be on a $300B to $400B of government debt for country that has just trashed its AAA rating in a world where there is no money?

    :p
     
  3. AsxBroker

    AsxBroker Well-Known Member

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    Hi Chris,

    That's why I'm ticked off that they keep on increasing the tax thresholds. Great way of losing heaps of tax from PAYG income taxpayers!
    If they kept the tax rates where they were a few years ago the deficit would be a lot lower.

    Maybe they will reduce the tax thresholds and stop dropping the highest marginal tax rate?

    Cheers,

    Dan
     
  4. Chris C

    Chris C Well-Known Member

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    I'm actually on the other side of the coin Dan. I think taxes are way too high and should be lowered further.

    There are are loads of developed countries out there that manage to have tax rates much lower than ours and still don't have budget deficit problems. Plus they aren't riding off a massive resource booms.

    What we have is a government that is unable to control spending, and thinks more spending is the solution to everything, and unfortunately the long term trend on taxes in Australia is definitely upwards sloping, along with governmetn expenditure on health and welfare (funny that):

    [​IMG]

    I don't know how other people feel but I'm not really not much of a fan of the whole tax the rich so the lazy can live the dream. Nor am I a fan of raising taxes so government can create more beaucratic jobs that are nothing more than a drain on an economy.

    As Regan said back in the 80s, "Government isn't the solution to the problem, it is the problem!".

    Unfortunately for America I'm sure the assination attempt on Reagan made him think twice about his stance when it came to his election promises of downsizing government.
     
  5. AsxBroker

    AsxBroker Well-Known Member

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    There is going to be quite a few in deficit...Who is going to be in surplus?

    With NSW hospitals constantly being in the news about not being able to pay bills, there obviously isn't enough being spent in health...

    It's also a great way of keeping control over unemployment figures.

    Cheers,

    Dan