True to his word, Senator Joyce has not relented in drawing attention to the dangers of ever-rising debt.
From the Canberra Times (my emphasis added):
A couple of years ago I was apparently a financial hayseed from the wild west of Queensland when I mentioned the debt.
Canberra is the canary in the coal mine for debt and the canary hasn’t been chirping lately. Mr Wayne Maxwell Swan has lost control and the cuts to spending and jobs are imminent.
I was startled at the trajectory of the debt when it was at $100 billion, and to be honest most ignored me. It wasn’t the size but the speed of the increase that worried me. Our gross debt is now $238 billion.
Last year Thomas Sargent won the Nobel prize for economics partly because of his work on government debt.
He noted that if you choose not to debase your currency, which can be the precursor to social collapse, government debt must be repaid through running budget surpluses at some point in the future equivalent to the size of our debt.
Debasing your currency is what the USA, UK, and EU are all doing, by “printing” money. In our Orwellian world of doublespeak, that is now euphemistically called “Quantitative Easing”. Their currency debasement is the key reason why (a) Switzerland’s central bank pegged their currency to the “QE’d” Euro, to protect their economy, (b) Norway’s central bank acted to weaken the Kroner, after all the “hot money” that was going to Switzerland went looking for a new “home” threatening to damage their economy, and (c) why the Aussie Dollar is way overvalued, wiping out whole industry sectors here, with only Bob Katter (and now, Paul Howes) arguing that something should be done.
Mr Swan believes, and this is just not going to happen, that we will have a surplus of $1.5 billion next year. Well, by then our gross debt will be about $270 billion and the custom of late means that it will be vastly more than that.
When Labor came to office, you owed $56 billion, so to get the debt back down to this level, Mr Swan will have to run budget surpluses of $1.5 billion for 142 years.
That’s the important point. A surplus does not mean that the debt is repaid, it just means you have a little bit of money to start paying off the debt.
So what are our other options?
Before our debt gets to $270 billion it has to pass through our current debt limit of $250 billion.
What would happen to Canberra if the limit on the nation’s credit card was not extended? A rather large train runs into a rather large boulder in a few months’ time.
If you choose not to do that you have to instead extend your overdraft again to your fourth debt limit in four years. Now we have an incredibly fast train going off the edge of a very large cliff in a year or so. So which one do you want?
Or do you just close your eyes and say a quick prayer to the Lord that it will all go away? Dear Jesus please pay our credit card off.
My humble suggestion is that you do everything possible for the cogs of the economy to turn in the most efficient way to make us as much money as possible.
This should start by getting rid of the carbon tax.
In my portfolio of water, I would recollect that between 2000 BC and 4000 BC the great civilisations of the world managed to create an economy from the development of irrigated agriculture. The Tigris and Euphrates, the Indus Valley in what is now Pakistan and the Yellow and Yangtze in China.
If you do not have the capacity to create excess commodities, you do not have a surplus-generating economy. Yes it must be environmentally sustainable but it must exist.
This week I have been travelling around the Northern Territory looking at options for expanded agriculture. The people up here were hit hard last year when Four Corners ran the country for a month and exports of live cattle to Indonesia were banned. They are still recovering.
I have just been to a meeting where it has become apparent that when the government doesn’t know the answer they just invoke the word ”environment” and then they are miraculously endowed with omnipotent qualities that preclude your right to question them.
There is one other way we can pay back the debt. We can just tax people to within an inch of their life and vainly hope that they are motivated to remain in the legal economy.
On a scale of one year, you only started working for yourself in the last week. From January 1 to April 3 you have been working for the government.
How much longer do you want to work to pay for the NBN? How much longer do we all have to wait before common sense takes over in a big white big building on a hill in Canberra?
More wisdom and commonsense in his little finger, than in the rest of Parliament House combined.
Barnaby is right.