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The Budget…an ongoing lie

As a political commentator, I probably shouldn’t admit that I’ve given up on Q&A. I came to the conclusion late last year that it had lost its way. I felt it was pandering more to ‘gotcha’ moments for entertainment purposes rather than in-depth political analysis and holding politicians to account.

I haven’t watched a full program this year, tuning in only at the tail end to see if anyone had imploded or proclaimed Australia a Republic. None of that happened last night, but what I did witness toward the end was the Minister for Veterans Affairs, Dan Tehan, give us his view on how we were going to repay the national debt.

He went on with some rubbish about having to get the budget back into surplus before we could begin paying down the debt. “Until you can get your balance sheet right, you won’t be able to (address the debt),” he said. His comment reaffirmed how right I was to stop watching Q&A.

Tehan said we needed to get the budget back into surplus, before we could start paying down the debt and I have no doubt he actually believes this. Most government and opposition members do. And therein lies the problem. They are economic illiterates.

How does one cut through on this issue? How do we go about explaining the reality that is a fiat currency? How do we explain in words of one syllable, that a government bond purchased by an investor and held in an account at the Reserve Bank as a deposit for that investor, is not a debt repayable by the people of Australia?

How do we explain that money received by the Reserve Bank for bond sales is not spent providing services? How do we explain to our politicians that all government spending is new money issued by the Reserve bank and electronically transferred to the commercial bank accounts of those who provide government services?

How do we explain that taxation receipts are monies drained out of circulation to enable the infusion of new money to keep the economy turning? How do we explain that a budget surplus is not a saving to be spent at some later time?

How difficult is it for a politician or the average person to grasp this reality? How much better would a platform like Q&A be if it were to confront politicians with this reality and call them to account on their failure to address poverty and inequality?

What is the point of having those who receive welfare payments, those who are public servants, pensioners and so on, believe that they are the beneficiaries of someone’s taxation receipts?

How much better would the conversation be if we were no longer tortured with comments such as, “my taxes are paying for this” or “taxpayers’ money is being wasted,” or other such absurdities?

Tonight’s budget will be, as it always is, the greatest lie a sovereign currency issuing government can tell. And the lie is perpetuated day in, day out, on an unsuspecting public who don’t know any better.

Tonight’s budget will be a chest-beating, blowhard of fiscal allocations that are meaningless to most people because they will neither understand the language used, nor be sufficiently informed to make a judgement on its value.

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32 comments

  1. stephentardrew

    Face plant!

  2. Ross

    John, would this budget be a tad different if the government was not so on the nose but riding high in the polls.
    What if there was no 40+ negative polls hanging off the governments neck, what if sitting coalition politicians and state governments are not being decimated by voters who are not that keen on snake oil austerity politics.
    Would the poor, the old, the sick, the unemployed, the pensioners, the unions, the teachers, the doctors, the hospitals and all of us, the 99% have something to really fear if the government was riding high in the polls?
    Fairness, don’ t make me laugh, budget 2014 gave us a taste of what the coalition is really about.

  3. stephengb2014

    John I wroteto my MP a Labor – hos m9nder came back and said that Bill Shprten and the Laborarty are cognisant of MMT, and agree with it. He then went on to gove me links to speeches by Bill Shorten where Bill talked in terms of manabong the debt.

  4. Terin Mahsout

    I just wish the ABC would let more of viewers’ detrimental commentaries through, instead of preventing us from demanding honest answers from our political leaders. We are sick of their rhetoric! We are sick of how they consistently deny their fraudulent, corrupt and socially irresponsible activities! The entire LNP Government needs to be replaced with the kind of people who actually want prosperity for ALL Australians, not just the fat cats at the top of the pyramid.

  5. Lurline O'Brien

    I’ve had a few comments on sharing the article I wrote, that I should shut up and be grateful to taxpayers for my $75. I’m very grateful, but not to the taxpayers as they’re not paying me. I’m grateful I can keep my energy provider making enormous profits with all the $75’s they receive to pay winter gas supply charges for 111 days. No gas included, just the right to use it. That’ll keep all us pensioners warm this winter for sure.

  6. lawrencewinder

    Ooh, I quite like QandA as it provides the ruling rabble an hour to display not only their incompetence but also their sheer lack of imagination. …like Tehan last night, breaking into a sweat trying to justify the waste of $100,000,000.00 for the museum at Fromelles and his complete inability (or bloody-mindedness) to contextualize Gonski Mk#2, HECS payments, Uni fees and housing prices… even panellist Danni Addison quipped to him something apropos “… you’ve lost this audience…” and Dave Hughes …well just watch him…

  7. Chris2017

    Thanks for your piece: I would not disagree except my feelings on the ABC and SBS are volcanic. Our money for crap and if you listen carefully, canned laughter on so-called comedy and light drama.

  8. paul walter

    Chris, you could go further and talk about Fairfax, which is an unrecognised scandal also.

  9. helvityni

    Q&A is better when there are no politicians on the panel, maybe ABC could invite some of our older, past politicians, who can be quite entertaining like Keating or Hewson, or someone like Bob Brown to remind us that Global Warming is real…not fake news…

  10. Paolo Soprani

    With you all the way on this. Total gibberish.is The Budget. Australia is a wealthy, prosperous country governed by idiotic, self-serving, deluded ideologues. The Press Gallery is in on this total charade, as are nearly all journalists. It is so completely a load of fiscal nonsense that people you try and explain it to actually have trouble grasping the fact that it is all complete garbage, so complete is the delusion!!! I believe the government is treasonous, hates the Australian people and is totally irresponsible when it comes to governance. The NBN, asylum seekers, funding the disaster that is coal, Tony Abbott, demonizing the sick and the poor, cutting university funding, school funding, medicare, negative gearing, tax avoidance by multinationals – all behaviour of a government acting AGAINST the best interests of the people they purport to represent. Treason!! And watch the gushing of the journalists tomorrow when they ‘analyse in depth’ this total package of BULLSHIT!!

  11. bobrafto

    I read somewhere in the past week that business profits were up around 60% (guessing, but I recall it being an impressive amount) so, where is all this employment being created by this bonanza? the correlation is that tax cuts are supposed to create jobs.

  12. Anne Heard

    Wow! Please have MMT explained in MSM. I have followed Bill Mitchell for a couple of years and am amazed that it’s not discussed more widely. What a con the politics of the economy is! We can all understand the basics of MMT, given some basic facts. But facts are anathema to Australian politics of fear.

  13. Kronomex

    Scott Morrison and empathy, what a contradiction in terms. I wonder who he had to mug to come up with that.

  14. helvityni

    …and there those two sit, looking all priestly and benevolent in their black and white attire, all smiles…we’ll find tonight, god give me strength, there will be some tears, and plenty of anger…

  15. lawrencewinder

    oops I meant.. the Sir John monah Centre at Villers-Brettoneaux.

  16. Marilyn

    I have been doing some research lately and I am looking into companies and the link between the boards. What I have found so far (early days) has made me absolutely furious and terrified. All the small, and not so small, Australian companies swallowed up by the big global corporations. Aged Care, construction, Telcos, developers, utilities and mining have been taken over or amalgamated, even Law firms.

    Where these companies would once have paid tax in Australia income can be sent off shore to minimise or negate tax. Remember Jennings, the home building firm, now gone. Swallowed! The times names are changed is horrendous! Leightons accused of corruption changed to CIMIC and is building the disgraceful WestConnex in Sydney. Cimic and Lendlease likely contenders for the second Sydney airport which the government will build despite the fact that the location is unsafe and SAC have opted out as a bad investment! Meanwhile corporate businesses are slathering at the prospect of dividing up western Sydney!

    What has happened? Why are we in this mess? Costs rising to provide more money for wealthy investors and the poor duded at every turn! Time to change the tune! This is not progress! A one off payment of $75 to single pensioners to cover doubling energy costs is an insult?

    What a gutless self-entitled lot we have in government!

  17. Phil

    Perhaps the politicians accused of economic ignorance are in fact not as ignorant as they would like us to believe?

    The game is to keep the majority public ignorant of the true economics – and the game is still going as per plan – but MMT info is seeping into the cracks and causing fractures to widen in the deceitful edifice. The genie is out of the bottle with ever widening public exposure to MMT and nothing can stuff that genie back in.

  18. Ric Testori

    I know that AIM is not yet MSM but having a writer as good as John Kelly come out with these economic truths supporting the logic of MMT is a wonderful feeling. Thanks John.

  19. Matters Not

    Re the Budget and the politics of same. Morrison et al have done well. At least in the short term.

    Stealing the rhetoric of the Opposition (Gonski) and giving a more sustainable meaning to same is fair game. That Shorten is running away from the essence of Labor policy is so sad. Now the ‘cheap’ politician. FFS!

  20. Don A Kelly

    The awkward truth is that as long as left leadership is framing important social issues in the erroneous neo-liberal ‘cost’ terms, the longer important infrastructure and social issues will be starved of funds.

  21. Alan Luchetti

    The only sensible budget commentary I’ve seen – and I’ve looked hard and long. Kudos, but I wish you weren’t so lonely.

  22. Peter

    Prediction: This is just a pathetic attempt by the Liberals to get a bounce in the polls so that they can call an early election. If it all goes to plan they will then have an extra 4 years to continue with their class warfare and tear our social fabric of society at the seams.

  23. Michael Taylor

    Peter, you could be right. Time will tell, of course, but there was talk pre-budget that this one would be an ‘election budget’. Let’s see what happens.

  24. Halfbreeder

    it was an election budget. i saw q &a and was disgusted by the bs sprouted by the tax accountant and the liberal politician but even more so by the abc journalist who had no capacity for critical thinking whatsoever and just assumed the bs was true. the dunderheaded lib poli stating ‘getting back to surplus’ yet aust hasnt been in surplus since before ww2. even.under menzies it ran deficits. phoney debt is the strategy used by neo cons to impose austerity measures and adopt liquidation strategies to buy cheap public assets and cut services and taxes on the pretence of attracting investment to create jobs. alla Greece. just wait until the TPP comes back. then the truth will be plain to see. and the shit will hit the fan

  25. Peter

    All the Liberals have essentially done with this budget is temporary switched their skull and cross bone pirate flag for something less threatening because they know their ship is taking on water, and fast. And if their stunt works they’ll immediately raise their pirate flag again and go back to looting the country of its wealth. This is who they are. This is what they always do. One just has to take a look at their atrocious history to see that is true.

  26. Bob

    Chris2017, have to agree on the quality of ABC and SBS.
    The decline in the ABC is more pronounced, I can hardly bear to watch it these days other than 4Corners and Foreign Correspondent.
    As for canned laughter, what a dead give-away that is. Hear it, pick up remote blaster, done.
    There are now so many shows I have never even watched for 1 minute, the promos are enough.
    I hear the laughter canned and bye bye.
    That producers keep making the stuff says a lot about the caliber of audience.

  27. Harquebus

    “How do we go about explaining the reality that is a fiat currency?”
    It’s easy, they all fail and John Kelly, an economic illiterate himself, is the last person that should be giving advice about grasping economic reality.
    Cheers.

  28. James Cook

    Can anyone please point me to a succinct, easy-to-understand-for-an-economic-illiterate article or book on MMT? I’m really trying to come to grips with the whole Government and Budget thing. All your comments indicate that I’m very out-of-touch.

  29. James Cook

    Many thanks Matters Not and Joe. I’m onto it!

  30. Pingback: The Budget…an ongoing lie | THE VIEW FROM MY GARDEN

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