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Reaping what they did not sow

By Anthony Cox - posted Monday, 17 June 2013

Some commentators have argued that Australia is currently well served politically by the Gillard government as shown by a number of economic indicators.

This misses the point. Australia has many natural advantages in mineral, agricultural and technological wealth. Equally important is Australia's democratic structure and individual freedoms which our citizens enjoy.

Given these inherent advantages the proper measure of whether the current stewardship by the Gillard government is enhancing Australia is not a comparison with other nations who are not so well served by inherent advantages but whether Australia is doing as well as it should or could be.


The Gillard government and its treasurer Wayne Swan are given credit for seeing Australia through the Global Financial Crisis [GFC].

At the end of 2008 and the beginning of 2009 Swan's Stimulus packages gave $21 billion to various categories of Australian citizens.

The recipients of this largess spent their windfalls in the following way:

Spent it [on things other than bills or other debts] 39.8%
Used it to pay bills [utilities (phone, electricity etc), medical, other services] 30.2%
Credit cards 1.5%
Mortgage 2.9%
Personal/short-term loans [e.g. car payment] 0.3%
Saved it 18.7%
Invested it  4.9%
Don't know/Not sure 1.2%
Refused 0.4%
Total 100.00%

The summary of the expenditure categories were:

Panel B: Collapsed Categories

Spent 40.5%
Saved 24.0%
Paid off debt 35.5%

No lasting infrastructure or investment flowed from this $21 billion. It was either consumed immediately or used to pay off personal debt.

The contrast with China's response to the GFC is instructive.

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About the Author

Anthony Cox is a lawyer and secretary of The Climate Sceptics.

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All articles by Anthony Cox

Creative Commons LicenseThis work is licensed under a Creative Commons License.

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