Bam wrote on Mar 12^th, 2020 at 10:20am:



On the contrary, the country would have been $5 Billion per annum worse off in the real economy under Shorten Labor.

Vic wrote on Mar 12^th, 2020 at 3:12pm:


Well said!   

Meanwhile ... the opinion so far is that the Morrison fiscal stimulus package is pretty good. Some more may be required in May.

'Rudd mark II': what experts say about Australian government's $17.6bn stimulus package

Economists say the Coalition’s response to the coronavirus will do its bit to boost confidence, but further cash maybe needed

A step in the right direction to boost GDP growth

The government’s announced fiscal stimulus worth around $17.6bn, or about 1.2% of GDP. Importantly, 60% of the spend will land in 2Q, boosting GDP growth sizeably in the quarter. Cash payments to welfare recipients will support consumption, as should the increase in the instant asset write-off for business. The transfer/subsidy to business is also reasonably generous, and should go some way to insulating the labour market by providing an offset to any liquidity issues.

Generally we view this package as a step in the right direction, and it is worth noting that the government retains the option to scale or add to these measures in the May budget if required. The government has been reasonably short term in dictating the duration of stimulus, with all of it to be spent or distributed before mid-2021. This should go some way to insulating budget estimates in the out years from too much deterioration.

– Sally Auld is the head of Australia and New Zealand economics and markets research at JP Morgan.

Handing money to the lowest earners is effective

The government’s decision to provide cash payments and incentives to the supply side of markets, helping companies continue to fund their payrolls (including apprenticeships) and in other ways negotiate supply-chain disruptions, is welcome news. This support could have been even more targeted to sectors that are worst affected. Extra support to the health sector – an obviously affected industry – is also welcome, though the opportunity was missed to underscore facts about hygiene habits, bug virulence, and our country’s preparedness, that would reduce public panic.

The decision to write cheques to welfare recipients seems sourced in the notion, valid or not, that such people are most likely to feel the pinch of supply-side disruptions. Handing out money to our lowest earners is a more effective spending stimulus than handing it out to the highest earners, due to the former’s higher marginal propensity to spend. While a once-off handout to Australia’s worst-off gets my vote, as with the infusions for suppliers the tailoring of this government response to the Covid-19 virus disruption could be better. To counter Covid-19’s effects, we would target directly affected workers, not implement a blanket demand-side stimulus to poor people. I expect administrative feasibility featured in the government’s deliberations.

– Gigi Foster is a professor in the School of Economics at the University of New South Wales, and co-host with Peter Martin of the Economists on ABC RN.

Striking in its similarity to Rudd response

The most striking feature of the government’s response is that it is identical in outline, and in many of the details, to the Rudd government’s response to the global financial crisis. The central elements are a cash handout aimed at sustaining consumer demand and broad measures to stimulate investment. The idea of a modest and tightly targeted stimulus, with a price tag of around $5bn, being promoted by government leaks as recently as last weekend has been abandoned.

Instead, we have a package with an initial cost of nearly $18bn. Allowing for inflation and population growth, that’s very similar to the $10bn cost of the Rudd government’s initial stimulus. As with the Rudd package, the plan is to wind that back rapidly once the crisis is over – we all know how that worked out. It’s highly likely that the economic aftershocks will be felt for years to come, and that the impact on the budget will be well over $100bn by the time we recover.

The big question is whether anything will change in the longer term. In the immediate aftermath of the GFC, we saw some attempts at rethinking the failed ideology of market liberalism, and accepting that a modern society can only function with a strong government and a commitment to a just society. The looming disaster of the coronavirus is exacerbated by growing inequality and insecurity. Hopefully, the response will mark a turning point.

– Professor John Quiggin is the VC senior research fellow in the school of economics at the University of Queensland

Captain Nemo wrote on Mar 12^th, 2020 at 4:25pm:



The stimulus package is “pretty good”, because it is nearly a direct copy of Rudd!  It is Rudd Mark 2. As the good professor Admits. “Striking in its similarity to Rudd response”.    That would be the policy that Turnbull and abbot pilloried and now it suddenly is good policy. Please tell me though, where are the billions of dollars coming from to pay for it?    How much money are my grandkids and great, great grandkids have to pay back because of an incompetent Coalition who have not produced one surplus since their election in 2013.        Labor did not win government so anything they would have done is a moot point.   
Where is the promised surplus Morrison to match the coffee cups you spent money on marked “ back in black”? Where is the money coming from for Rudd Mark2?

Captain Nemo wrote on Mar 12^th, 2020 at 2:30pm:

That is unprovable hypothetical rubbish.

Why are you ignoring the real mess the Coalition has made to the economy in preference to posting wild-eyed hypothetical nonsense?

Bam wrote on Mar 12^th, 2020 at 5:11pm:


What ever happened to the $100 lamb roast we would be paying under the ETS....Nothing much changed apart from emissions dropping and business booming....The Coalition spew bullshit and idiots believe them despite evidence to the contrary....Now they have copied Swan's stimulus and claim it is now sensible policy....Australia deserves to go into recession for voting in these ass holes!!!

John Smith wrote on Mar 12^th, 2020 at 4:59pm:


No benefit to the "real economy".

Just a $5 Billion hit to it.