Rudd's $42 billion 'nation building' plan (3 Viewers)

[i.x3.candy]

i want to ask, will international student( overseas student) be eligible for the bonus?
and when they say earning less than 80k, is that during 07-08 or 08-09 included aswell?

Thank you

 

[Smithereens]

i want to ask, will international student( overseas student) be eligible for the bonus?
and when they say earning less than 80k, is that during 07-08 or 08-09 included aswell?

Thank you

why the hell would you get a bonus? You're not even a citizen.

 

[i.x3.candy]

first of all

i'm not even from china
second i just asked a question =)

and thirdly, i am an australian resident for tax purposes~
and do work in australia as a casual
so that's why i'm asking

 

[johony]

haha


gunna get me a new tv
thanks nick xenophon

 

[ziki]

wasnt this plan on hold like 2 days ago? and some minister was blabing in senate

'australia is the first country that a stimulus pakage was rejected'

 

[Will Shakespear]

coz in the other countries they didn't try to rush it through without letting any other parties read the fine print, lol

 

[Gerald10]

How much is too much debt?

When it becomes unserviceable - ie you have to borrow more to pay off debts which leads to more debt thus leaving you in a debt spiral which for a nation means the collapse of the exchange rate and therefor hyper inflation and mass unemployment - see Zimbabwe. We are not even remotely close to that situation - in fact the package would need to be 10x the size for us to be even on par with this the rest of the western worlds economies.

 

[Gerald10]

On one hand I agree with what Rudd is trying to do here. Directly injecting cash into the economy will definitely get the Australian economy back up and running. However he probably hasn't thought long and hard that most people will end up using the money to pay back existing mortgages, or either saving it up for a rainy day (i.e. precautionary saving).

As Malcolm Turnbull put it nicely:
"The Labor debt train has left the station. Destination unknown. The only known fact is that our children and their children will pay for the debt."

Anecdotally you may find people saving etc. Paying back a mortgage makes a consumer more able to spend anyway so its still working. But on the whole economists take account of the marginal propenisty to consume (how much of every extra dollar given will be spent immediately) in delivering these packages to calculate a complex multiplier - ie how much $1 will stimulate the economy by. I believe normally that this is around 2.5%. So $10bn will stimulate the economy by $25bn. But it is perhaps lower.

See the above post in regard to debt - it will be repayed in the next economic cycle. Indeed that what should happen each economic cycle - a government go into debt to allieviate a recession then pay it off whilst trying to control the subsequent boom.

Edit: I wasnt even close to sober in writing these posts so please forgive me for grammer etc.

 

[blue_chameleon]

When it becomes unserviceable - ie you have to borrow more to pay off debts which leads to more debt thus leaving you in a debt spiral which for a nation means the collapse of the exchange rate and therefor hyper inflation and mass unemployment - see Zimbabwe. We are not even remotely close to that situation - in fact the package would need to be 10x the size for us to be even on par with this the rest of the western worlds economies.

10 times? Have you got anything to support that?

T'was a pretty simple question though, as a taxpayer of the country, what kind of debt level is unserviceable? 100 billion? 200 billion? 500 billion?

 

[SashatheMan]

My CTP insurance came in yesterday and registration re-newal for the car. all up just over $900 dollars.

So i am basicly going to be just giving the government back it's cash. Yey!

 

[Gerald10]

10 times? Have you got anything to support that?

T'was a pretty simple question though, as a taxpayer of the country, what kind of debt level is unserviceable? 100 billion? 200 billion? 500 billion?

Well most other western countries currently have debt levels of around 45% of GDP which is still (the market believes anyway) sustainable. Thats what I mean by 10x as big - our GDP is a little more than 1 trillion so a package of 450bn would put us on par with the rest of the western world's debt.

There is no magic figure that triggers the collapse in the exchange rate - if the Forex market completely loses confidence (and I mean completely) in a nation's economy for any reason, not just debt, the owners of AUD would sell like mad until the currency was virtually worthless. We do not want this because it is economic doomsday - interests rates must go up to attract investors to hold the exchange rate which causes domestic demand to stop while the collapsed dollar would mean that inflation would be huge. In other words your completely and totally f***ed.

But for that to happen our debt would need to be far far far bigger - I would hazard a guess at around 100% of GDP give or take 20% - but the market is unpredictable - I cant be certain of those figures. I do know that it is considerably more than 100bn and probably a lot closer to $500bn.

Theoretically all the future surplusses should be used to finance deficits over the course of the business cycle (from recession to recession) and 100bn in that case isn't anything to worry about. But look we should question these decisions - they are big decisions with consequences but the consequences of a minor future restraining of growth is far surpassed by the consequence of not going into debt which is a deeper and prolonged recession.

 

[withoutaface]

Other nations' debts have been accumulated over years and years, the idea that just because they have debts accounting for 45% of GDP that we should try to reach this with one piece of legislation is just ridiculous.

 

[katie tully]

I just resent people yapping about "their" money.

 

[Iron]

Bishop of London says that redundancy is good for the soul -Times Online

Redundancy could be a blessing in disguise for City workers who have fallen victim to the credit crunch, the Bishop of London said yesterday.

"Sometimes, people seem to be relieved to get off the treadmill and to be given an opportunity to reconsider what they really want out of life. One of the great implications of this turbulence for us is to re-boot our sense of what a truly flourishing human life consists of. The 'CrackBerry' culture is dangerously addictive and switching off from it is notoriously difficult,"

 

[Gerald10]

Other nations' debts have been accumulated over years and years, the idea that just because they have debts accounting for 45% of GDP that we should try to reach this with one piece of legislation is just ridiculous.

I wasn't suggesting that in any way... at all... ever. I completely agree that doing that would be ubsurd.

 

[blue_chameleon]

I wasn't suggesting that in any way... at all... ever. I completely agree that doing that would be ubsurd.

Ok, so with the understanding that we could reasonably service a debt of 45% of GDP before we had problems, and acknowledging that although it would be serviceable it would be absurd to take on debt of that magnitude, is it feasible to look at a ballpark figure as a cap for national debt?

Whilst I understand we need to stimulate the economy by spending money we don't have, I cringe at the rhetoric that we are in 'unprecedented times' and the government is willing to place the country into a debt level of 'whatever is necessary'.

I guess however, as we progress through 2009 we'll hopefully have more information on how much needs to be spent, and in what areas.

 

[The_highwayman]

the whole rudd policy employs a "give a man a fish" logic.

This money would be better directed into infrastructure and training.

 

[blue_chameleon]

the whole rudd policy employs a "give a man a fish" logic.

This money would be better directed into infrastructure and training.

The $42 billion package would probably get half of the projects proposed or planned by Labor in NSW completed.

Hell, if Rudd is handing out money to help support jobs and nation build to the extent of 'whatever is necessary', he can finish all of our projects, right? Considering NSW is probably the state in the worst economic condition.

 

[Lex152]

Only think this (nsw's state of affiars) is partly due to the redistributive measures of the gst?

 

[withoutaface]

Only think this (nsw's state of affiars) is partly due to the redistributive measures of the gst?

The GST excuse is a tiny, tiny proportion of what's fucked up about the NSW economy.