A little history

I don't usually post opinion pieces, but this one caught my eye as providing useful background to the next Federal Budget and the importance of understanding the policy mix.

The article points out the legacy of the Howard government's economic policy. They made Australians believe that a Budget surplus was 'good economic management' rather than achieving the economic goals we usually point to (inflation, unemployment, growth, external balance and income distribution).

The article suggests that giving Australians large tax cuts (especially to the better off) and making even less well off Australians believe Budget surpluses are always good has made the effective economic management of the Australian economy all but impossible.Monet

This is an opinion piece, however from my point of view I can't fault the analysis. I'd particularly like you to notice how the mismanagement of the mining resources boom has put monetary and budgetary/fiscal policy in almost perpetual conflict. It is also clear that the author sees Australia's deficit problem as one of too little revenue, not too much government spending.

The Canberra Times article is here

This article is most appropriate for VCE students who must understand the context and detail of Budgetary policy over the last four years. This provides context for current events. IB and VCE students will be able to see how different policy measures are interdependent and can be mutually supportive or cancelling. IB students should note - this is not suitable for an IA being an opinion piece.