Last week’s Final Budget Outcome (FBO) for 2023-24, released by the Australian Treasury, confirmed that Progressive Labor governments are far more successful than right-wing coalition administrations in managing the budget.
The document was a resounding affirmation of the economic success of the Labor Government led by Prime Minister Anthony Albanese, who won office in May 2022. The Albanian government will contest another election early next year.
The FBO debunked several perennial lies from the pro-Coalition Murdoch, Nine and ABC newsrooms, including that Labor always outspends the Coalition.
Government spending has been systematically distorted
A misleading article reporting on the FBO last week in prestigious Australian dailies Age and the Sydney Morning Herald quoted the Coalition’s shadow treasurer, Angus Taylor:
“…This is the biggest government spending and taxation in Australian history. Taxation since Labor came to power for the year just gone has increased by $104 billion… and the vast majority have actually spent it.”
Why the unhappy writer Age What he didn’t fact-check was that almost every budget sets a new spending record as Australia’s population and economy naturally expands. In fact, only three times since World War II has spending fallen year over year. This happened in 1954, 2013, and 2022, in all cases adjusting for previous outlier growth.
Of the era another failure was ignoring spending relative to gross domestic product (GDP). This was a modest 25.2% in the year to June, only marginally higher than last year’s low spending result of 24.5%. These figures compare with 31.3% and 26.4% in the last two years under the Coalition. Angus Taylor is a greedy hypocrite.
Of the seven prime ministers this century, the three worst spenders were all coalition prime ministers. See the chart below.
Budget surpluses to repay the debt
Only two governments this century have generated net surpluses along the journey – so far. They are John Howard’s and Anthony Albanese’s. The two worst administrations for budget deficits were the Abbott and Morrison Coalition regimes. See the chart below.
The $22.1 billion surplus the Albanian government offered in 2022-23 was the strongest in dollar terms since records began in 1970. The most recent one, confirmed last week, was not as large but still in the top of all time.
As a percentage of GDP, they were 0.9 and 0.6, respectively. The biggest GDP surpluses this century were Wayne Swan’s 1.7% (Labour) in 2007-08 and Peter Costello’s 1.6% (Coalition) the year before.
The crippling cost of Coalition incompetence
Two consecutive surpluses in today’s difficult global conditions underline the destruction wrought by the Coalition from 2014 to 2019, pre-Covid. There have been boom years in Australia, with record demand for exports, strong commodity and agricultural prices, low global inflation and international economic stability and growth.
In these six years, all well-managed economies have generated budget surpluses and paid down their debt. Germany, Norway and Luxembourg ran surpluses in each of those six years, while Denmark, New Zealand, Sweden and Switzerland were in the black five times. The Netherlands, the Czech Republic, Lithuania, Iceland and even Greece ran surpluses in four of those six years.
Australia, by contrast, was a conspicuous loser, producing no surplus in any of those years of plenty. None. Instead, they ran up total deficits of $169.9 billion and cut gross debt from $271.7 billion when they took office to $561.8 billion in December 2019, before Covid.
Then they badly botched the response to Covid, wasting almost half of their vast stimulus spending. At the end of their horrendous administration, deficits totaled $421.3 billion and the debt exploded to $895.3 billion.
That Australia’s current horrendous debt and high interest payments are directly attributable to the corruption and incompetence of the shonks and shysters who ran the Coalition parties during that period is borne out by the surplus-generating and debt-repaying work in far less favorable circumstances.
Lying media contortions
This, of course, leaves Australia’s pro-Tory commentary with no case for re-electing the Coalition – which they have traditionally based on economic supremacy.
This will not stop them from trying. The aforementioned “story” from last week in Age they couldn’t find any basis in the FBO for a negative title, so they made one up. Headlined “Budget starts to show wear and tear on slowing economy”, the presenter read:
“A sharp drop in tax receipts from workers and businesses over the past four months has revealed an emerging economic bottom line ahead of the upcoming federal election, despite the government running one of its biggest budget surpluses on record.”
There has been no drop in tax revenue, sudden or otherwise. It was a huge increase. Taxes in the year to June totaled $633.4 billion, the highest on record. This was 23.7% of GDP, the highest since the boom period, just before the GFC. It was $32.1 billion higher than the previous year and $96.8 billion more than the Coalition’s top tax take in 2021-22.
What Age it was seen that actual tax revenue was slightly below the boffins’ gross estimate in the Treasury’s May budget papers – by 0.83%. They then described this as “a sharp drop” foreshadowing a serious “economic line”. Pure nonsense.
This is indeed “before the next federal election”. So Australians can expect more where that came from.
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This is an abridged version of an article published today in Independent Australia. The original article is available here in its entirety for free:
independentaustralia.net/…
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