0

Shopping cart

Restraining the House of Spendthrifts

David-Leyonhjelm-Liberal-Democrats-Federal-Senator_740x460
Share on linkedin
Share on facebook
Share on twitter
Share on email

Imagine a demagogue playing a game where he needs to become generous with other people’s money. It’s easy – they earn it, and he decides how to spend it. And when they don’t earn enough for all the spending ideas he comes up with, he can borrow on their behalf, and mortgage their children’s future.

Labor governments in Australia have played this game well.

Liberal governments have talked about its dangers, but have also played it well. Former Treasurer Peter Costello ran years of budget surpluses in the nineties but was blessed by the mining boom; spending was still going up. The period was described by economist Chris Richardson as “temporary boom, permanent promises”.

When he became Prime Minister, Malcolm Turnbull assured us he would fix this problem. But now his government is exacerbating it.

Underlying the problem is that the beneficiaries of more government spending are many, the payers few, and everyone has one vote.

More than half of all Australian households receive government cash handouts. More than eighty percent of the population pays less in tax than they receive from the government, after allowing for ‘in-kind’ benefits such as public schools and hospitals. That means less than twenty percent of the population pays for the collective goods we all benefit from, like defence, police, footpaths and street lighting.

We are electing our way to a problem by not insisting that governments reduce spending.

The Liberal Democrats are committed to smaller government, lower spending and lower taxation.

Senator David Leyonhjelm is a Federal Senator for the Liberal Democrats.

Share on linkedin
Share on facebook
Share on twitter
Share on email

Subscribe

The Australian Business Executive (The ABE) provides an in-depth view of business and economic development issues taking place across the country. Featuring interviews with top executives, government policy makers and prominent industry bodies The ABE examines the news beyond the headlines to uncover the drivers of local, state, and national affairs.

All copy appearing in The Australian Business Executive is copyrighted. Reproduction in whole or part is not permitted without written permission. Any financial advice published in The Australian Business Executive or on TheABE.com.au has been prepared without taking in to account the objectives, financial situation or needs of any reader. Neither The Australian Business Executive nor the publisher nor any of its employees hold any responsibility for any losses and or injury incurred (if any) by acting on information provided in this magazine. All opinions expressed are held solely by the contributors and are not endorsed by The Australian Business Executive or TheABE.com.au.

All reasonable care is taken to ensure truth and accuracy, but neither the editor nor the publisher can be held responsible for errors or omissions in articles, advertising, photographs or illustrations. Unsolicited manuscripts are welcome but cannot be returned without a stamped, self-addressed envelope. The publisher is not responsible for material submitted for consideration. The ABE is published by Romulus Rising Pty Ltd, ABN: 77 601 723 111.

© 2019 - The Australian Business Executive. All rights reserved.