Normally, I can see what Peter Martin is driving at, and can see merit in his views, but having just read "Why Not Cut GST?" (2008-11-24), and I’m shaking my head.
Sure… it doesn’t just benefit irresponsible borrowers. Yes, the discount might have a sunset clause of a year, but I can’t see any government in the last year of a term, with 2009 probably being even worse than 2008 as far as main street is concerned, increasing taxation.
OK, OK, Peter is just quoting someone else, but still…
We’ve got rusted-out infrastructure, a whole lot of other capacity constraints, so even if we keep spending as individuals, we’ll be in no better shape when the economy starts moving again around the world. We won’t rise with the tide… we’ll still be anchored to the seabed and drown.
With things about to get really ugly, it’s not an extra couple of percent in your pocket this week that inspires confidence… it’s your opinion of whether you’ll have a job in a couple of months.
As I’ve outlined before ("Sarkozy’s Smart Move" – 2008-11-09) buying back the farm (to be sold at a tidy profit in a few years) and giving confidence to mums-and-dads by bringing back a strong and deep public service, rather than have people worry if they are working for subcontractors, as well as putting down infrastructure when labor and resources will have little price pressure, would leave us in much better shape down the track.
Balneus 