Australian Election 2016 – The Great Pork-Barrel Election That Dooms Us To Dangerous Debt

Posted on Thu 06/30/2016 by

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Bolt New 01By Andrew Bolt ~

The spending to save Malcolm Turnbull has been a disgrace, matched only by Labor’s own spendathon.

AustralianElection2016David Uren:

Bill Shorten’s sackful of policy promises includes spending measures totalling $34 billion across the next four years. That is about $2200 for every one of our 15.5 million enrolled voters…

The Coalition’s spending promises of $3.4bn look to be a snip at only $220 a vote, but that is not the full story. The decision to spend $35bn building frigates and another $50bn building submarines in Adelaide was driven by the need to shore up vulnerable South Australian Coalition seats, while the company tax cuts add another $4.9bn to the deficit across the next four years.

Much of the Coalition’s election spending has been targeted at shoring up individual sitting members. In electorates where the Coal­ition is worried — such as Leichhardt, held by Warren Entsch in far north Queensland, or Eden-Monaro, held by Peter Hendy in southern NSW — it is spending between $60 million and $70m on sundry projects. That translates to almost $1000 of taxpayer funds for every voter….

[A]ll this vote-buying should stop… And even if it did pull a hundred or so votes across the line in marginal electorates, it is a partisan corrupt­ion of government.

With the budget in deficit to the tune of about $40bn a year almost continuously since the financial crisis, politicians should be focusing on how they plan to wind back spending…

The Coalition talks about getting spending down as a share of gross domestic product but is pledging its hopes of doing so on passing stalled savings through the Senate and on a rapid acceleration of nominal economic growth (the value of all goods and ser­vices). Neither appears likely… Labor derides the Coalition’s so-called “zombie measures”: savings from 2013-14 that have not passed the Senate. The Parliamentary Budget Office puts their value at $12.3bn across the next four years and $50bn across the next decade.

Pork barrelling on a grand scale:

The Turnbull government has pledged to spend $859m on 73 infrastructure projects in Coalition-held seats and only four Labor-held seats benefit…

The projects have all been announced since the 3 May budget and are detailed in the Coalition’s costing document released on Tuesday by the treasurer, Scott Morrison, and the finance minister, Mathias Cormann…

The seat held by the deputy prime minister, Barnaby Joyce, New England, is a major beneficiary, receiving grants for the Armidale airport roundabout, Inverell shire traffic flow improvements, the Jewry Street bridge, the Munsie bridge upgrade, Scone bypass, Tenterfield heavy vehicle bypass and an upgrade of Tamworth regional airport…

Result? The Liberals actually aren’t spending much less than Labor at all.  Jacob Greber:

(A)nalysis by The Australian Financial Review of the tax and spending projections of both sides of politics indicates the Coalition is almost certain to match Labor’s spending levels unless it ramps up cuts or succumbs to the draw of higher taxes…

In analysis that underscores how permanent the expansion in government spending as proportion of GDP is likely to become, the 2016 budget papers and Labor’s 10-year fiscal plan released on Sunday confirm there is almost no difference between the two sides on spending, which will remain at levels normally associated with recession or economic downturns.

Under Labor, payments as a proportion of GDP will stay above 25.7 per cent though to 2026-27, when they hit 25.8 per cent, the same as where they start in 2015-16.

The Liberal-National party’s spending outlook is virtually identical, with outlays edging down only slightly by 2026-27 to 25.4 per cent of GDP.

The difference by 2026-27, in today’s dollars, is about $6.4 billion, or 1.5 per cent of total Commonwealth spending in 2015-16.

On taxes, the contrasts are more substantial. Labor’s tax levels will climb to a record 26.4 per cent of GDP by 2026-27 from 23.5 per cent in 2015-16…

The government’s total tax take will climb to 25.6 per cent of GDP in 2026-27, an increase worth almost $34 billion in 2016 terms, but still $12.8 billion less than Labor…

A consequence of the projections is that Labor can forecast larger, if modest, long-run surpluses, whereas the Coalition’s projected windfalls of around 0.1 or 0.2 per cent of GDP are essentially rounding errors…

Labor, which hasn’t challenged the Financial Review’s calculations, pointed out this week that the Coalition’s outlook relies on it passing around $15 billion in so-called “zombie measures” left over from the 2014 budget, and still subject to being approved by next Senate.

Andrew Bolt writes for the Herald Sun, Daily Telegraph, and The Advertiser and runs Australia’s most-read political blog. On week nights he hosts The Bolt Report on Sky News at 7pm and his Macquarie Radio show at 8pm with Steve Price.

Read more excellent articles from Andrew Bolt’s Blog . http://blogs.news.com.au/heraldsun/andrewbolt/