Quote Originally Posted by jimandr View Post
I dare say Waza's point is that we will have to pay for these massive deficits somehow, and tax increases are the obvious consequence.

I've actually been taking a quiet delight in the uncomfortable way the right wing nut jobs have been supporting the PM and government, when ever since 2008 they have declared big deficits to be evil. On the same track I've been enjoying the discomfort of the hard left, who are finding it difficult to criticise the PM and government right now.

Nevertheless, the world has changed, and we are going to have to live with it the best we can.
The reason that big deficits are bad is they give you less lee way when the shit hits the fan like now. We sailed relatively easily through the GFC because we were actually in credit when it started, thank to Howard and Costello and the Mining boom. At the end of the day the same fundamentals that drive your household budget, drive the national economy. Despite what Economists might try to tell you to the contrary. After all the national economy is fundamentally just the collective of all the budgets; household, business and public sector.

The problem now is there is really no palatable alternative. You need to look to how the US fares because they are a big driver of global demand, and we feed off that demand by supplying the raw materials to the manufacturers etc. The other thing to look for is a change in how business, work etc is going to be done in the future.