LETTER: Too much or not enough debt?

Sir – Followers of current political discussion will know that there is a widespread view that the world economy is in dire straights because countries have accumulated too much debt. This proposition is generally put forward by conservative parties and used as evidence of the incompetence of more centrist or left leaning parties. It is used when the debt to GDP ratio is around 25% (Australia) as easily as when it is over 100% (some European countries).

So it will be most informative for us to follow the experience of Japan where the new “conservative” government have decided to throw out the text book and re-inflate their economy. [Straits Times Asia Report, April 19.]

If we followed their approach is it possible we could finance the NBN, NDIS, Education Revolution, Fast Train past Brisbane and Tony Abbott’s generous maternity leave package too? Additional reading on the same subject is Paul Krugman, Nobel Prize winning economist and regular NY Times columnist.

It is time for Australia’s press to seriously question the current assertion by so many of our current state premiers and Liberal/NP shadow cabinet members that they have or are about to inherit an economies in deep trouble. The truth may be that it is their policies that have or will cause the trouble in years to come if we fail to learn from world experience.
Richard Bentley
Alice Springs

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