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2009-09-03

Redesign remaining fiscal stimulus measures

Comments on Dennis Shanahan “The big cash splash”, 3/09/2009, http://www.theaustralian.news.com.au/story/0,25197,26019544-17301,00.html

This shows how incompetent and poor management of budget spending are wasteful and hard to stop once in train. The Rudd government will be remembered for its wasteful spending and it will have to live with that legacy for the time to come. It might come back to bite them even as early as the next election if it is held in its normal cycle.

As Shanahan pointed out, there is political as well as economic difficulties that may prevent the Rudd government from cutting back its big cash splash. However, it is not too late to redesign some of the stimulus package to target better and achieve better outcomes than the original budget plan. That requires skills as well as political courage.

It will be a test of its real economic management credential. The taxpayers and the public will tolerate government inefficiencies and incompetence forever, no matter how skilful the government is in political spins. The political rhetoric for government intervention and big spending using the recession as excuses cannot stand for too long, given that the economy has shown resilience in holding up growth.

They need to wake up to the reality and its honey moon is over. Public scrutiny will be strong and strengthened over the next months. They will be held accountable for their economic and program management.

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