With the Federal Budget set to be handed down next week, I suspect a lot of political skin will be riding on how it is received. All indications thus far suggest it will be designed to support the economy and protect jobs in a rather fragile environment.
Whilst there is always the usual sanctioned ‘leaks’ and media speculation, it is a fair guess that the country will run a large deficit next year – and for some years after that.
This fuels my long-standing thoughts that the national debts run up by the previous government will not be repaid during my working life.
To put it simply, the waste of the pink batts fiasco, the $900 cheques to dead people, the school halls deceit and assortment of stupid spending to mitigate some short-term pain will now be left to our grandchildren to repay.
If I was to have a bet on it, I’d say any meaningful repayment will never happen. We have set out on a path of debt and deficit which seems of little or no concern to too many politicians.
Many now appear happy to kick the can down the road so that someone else, sometime, will have to pick it up. This is the same approach that has got so many other countries into so much financial trouble.
That trouble will come home to roost later this year. Globally, I suspect we face the greatest financial crisis seen since the Great Depression of the 1930s.
It will be characterised by a lack of faith in government, bond defaults and an insatiable hunger by governments to raise more taxes. You see, whatever problems governments face, you can bet your last dollar that they’ll claim it is a lack of revenue that is causing it.
That means more taxes for you.
To their credit, based on the rumours surrounding the 2015 budget, the Abbott government seems to be resisting this approach. I am hoping that more of my colleagues have come to the conclusion that higher taxes stifle growth and weaken our economy.
It hasn’t always been fashionable to argue this case over the past few years but it remains absolutely true. If the government has come to this conclusion then it’s up to the rest of us to convince the Senate that this is the best way forward.
Cory Bernardi is the author of seven books and has been a member of the Australian rowing team, a publican, an investment portfolio manager and spent nearly 14 years as an Australian Senator.
