Yes, Kevin, Let’s Talk About “The Facts On Debt”

KEVIN RUDD and his ceaseless sideshow of senseless spin continues to roll merrily along; fresh from his dubious success on asylum seekers, Kevin and the ALP are turning their focus to debts and deficit. The Labor story may be correct in a literal sense, but in reality its dishonesty is breathtaking.

Labor last night launched a new 30 second TVC, entitled “The Facts On Debt,” which — as ever — I am more than happy to share. Readers can access this masterpiece here.

First, the facts — as Rudd presents them.

Is Australia’s debt, per capita, one of the lowest in the developed world? Yes.

Is Australia one of only eight countries in the world with a AAA credit rating? Yes.

Does Australia rate a stable outlook from the three major credit agencies? Yes.

Kevin’s facts are 100% accurate — if taken strictly at face value.

So why, in Rudd’s words, are we hearing a lot from the opposition about Australia’s debt?

And moreover, why is this an issue that resonates strongly with people?

Firstly, ordinary Australians (unlike ALP politicians trying to gloss over their own incompetence) are concerned with what happens in Australia, not in “the rest of the developed world.”

Such comparisons are meaningless to people living in this country; they don’t simultaneously live somewhere else.

Secondly,with Australia’s government debt running at about 25% of GDP (or about $260 billion), the figure is low by world standards, but it’s also 30% of GDP higher than it was when Labor took office in 2007.

In other words, the ALP has reversed Australia’s debt position by about $300 billion in six years: and remember, “Labor’s Black Hole” that was inherited by John Howard and Peter Costello from the Keating government in 1996 was just one-third of that amount.

And third, debt levels might be “low” enough to keep ratings agencies docile — for now — but the trend of the country’s debt is clear, continuous, and headed in one direction: up.

People are legitimately concerned about this government pissing borrowed money up against a post; the collapse of Greece, Cyprus, and the ongoing wobbles in places like Spain and Italy serve prescient notice on Australians of what will happen if it doesn’t stop.

Labor has — as I said — racked up a $260 billion debt in just six years; to achieve this, it first had to also spend $40 billion in banked surpluses accrued by Howard and Costello just to reach the point of zero.

Were the ALP to be re-elected — and were the rate of borrowings to continue at the same rate they have thus far in its term of office — far from being situated near the bottom of the pretty graph Rudd presents, Australia would sit near the top.

(That graph, incidentally, has been circulated in social media for most of the past year — especially by former Treasurer Wayne Swan — whenever it has felt the need to defend its sorry record on economic management and/or its addiction to borrowing money overseas).

A lot of people are frightened of what might happen if another $150 billion is added to the debt pile at the end of a further three years of Labor government.

Rudd (and Swan, for that matter) have traded on the Global Financial Crisis for five years now as a justification for the debt problem they have created.

Yet economic stimulus measures introduced by the duo in 2008 were slated to amount to $43 billion at the time. What is the excuse for the other quarter of a trillion dollars?

We have of course heard the cracked record about “deteriorating government receipts” countless times; Swan in particular was fond of stating how little money was rolling in.

Even the various taxes the ALP introduced — designed to reap tens of billions of dollars, but in reality unable to raise a sweat let alone money in any reasonable quantity — were no fix.

(Many of us never thought the day would arrive when the “tax and spend” party couldn’t even tax something competently, but that day is now…)

But none of this has stopped Labor from throwing $10 billion at its own policy inferno that is asylum seekers, or attempting to blackmail Liberal state governments into signing on to receive billions of dollars in new recurrent education funding, or wasting tens of billions of dollars on useless school buildings, pink batts, and all the other misdirected programs that chew up borrowed Chinese cash with nary a skerrick of value for money in sight.

And that’s before we even get to routine waste, inefficiency and general mismanagement and/or incompetence: all attributes that are bywords for every Labor government that has held office since World War II.

We are “hearing a lot from the opposition about Australia’s debt” as Rudd puts it, because a) the Liberal Party was left to carry the can in 1996 and fix the mess Labor left behind; and b) the mess is even larger and smellier and more rancid this time around, and will take longer — and require tougher measures — to fix it.

The end consequence of a Labor government these days seems to be to leave behind a state of virtual sovereign bankruptcy for the Liberal Party to fix.

Once the Liberals have done so, ALP campaign techniques essentially boil down to calling the conservatives a bunch of nasty, heartless arseholes for fixing what Labor should never have broken in the first place, and eventually the ALP reclaims office.

And the whole cycle starts anew.

Australians are fortunate that the country isn’t at the point of near-bankruptcy, or anywhere close to it. At least, not yet.

But if Rudd, Swan and Gillard can chew through $300 billion they didn’t have in just six years, people shudder to think what they might be capable of if permitted a further three years to continue their debt spree unabated.

This is why we are hearing a lot from the opposition about Australia’s debt.

And it’s why Rudd — with his too-clever-by-half truisms, which omit the half of the story that tells of an appalling record of profligate mismanagement by his government — can talk about “the facts on debt” until the cows come home, but will have no credibility at all.

Wrong again, Mr Rudd.