Wayne Swans Harvey Norman Budget – Buy Now Pay Later

Agmates member and freelance journalist John Mikkelsen writes:

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THE build-up to this week’s Federal Budget reminds me of the hype over swine flu – it was going to be a shocker but turned out to be a bit of a fizzer as far as horror stories go.

A deficit of almost $58 billion instead of the $20 billion surplus forecast in last year’s budget is no cause for celebration, but the leaks before Treasurer Wayne Swan’s delivery on Tuesday night made sure any shock value was lost.

So if you tuned into Auntie to watch the presentation live in the hope of seeing the fiscal facsimile of Wolf Creek or the Blair Witch Project, you would probably have been a bit disappointed. Instead of a Canberra Chainsaw Massacre, we saw something more in tune with Willy Wonka and the Chocolate Factory.

Not that it was all good, there was some bad news and belt-tightening mainly for higher income earners, and for those in their forties or younger who had hoped to retire at 65.

Sorry, you’ll have to be nice to your bosses for at least another couple of years before you can tell them what you really think.

There was good news for single pensioners with $32 a week more, couples gain an extra $10, carers an extra $600 a year, workers receive some small tax cuts, but those on unemployment or single parent benefits miss out.

The $22 billion approved for major infrastructure is good news, even though it had been earmarked the previous year. But the devil is in the detail and most local residents will want to hear if a sizeable allocation will be made for the Gladstone airport upgrade. Don’t hold your breath.

It’s interesting that this “third stimulus package” is about equal to the cash handed out in bonus payments. (Critics claimed these did more to stimulate the pokies or the economies of countries such as China, churning out their plasma TV’s).

Cutbacks to private health insurance rebates are bad news but again we knew about those weeks in advance.

Now fired-up Opposition leader Malcolm Turnbull has challenged the government to swap the health cuts for an extra three cents tax on cigarettes, which he said would raise the same amount and lower the strain on health services. Go Malcolm!

The biggest criticism of the budget is its sugar coating of forward income estimates and a return to a budget surplus position as soon as 2015, which many analysts, even punters, see as over optimistic. And there are suggestions the government would really like the Opposition to trigger a double dissolution election before they have to frame next year’s budget, when the really bad news would hit the fan.

Centrebet has described this week’s effort as “A Journey into Neverland” and its odds on a Rudd government being returned next election have taken a blow.

Independent Senator Nick Xenophon labeled it ” A Harvey Norman budget – Buy now, pay later.”

Reminds me of a story I heard which could hold an answer:

“Holiday season is in full swing at a small seaside town but it’s raining so there is not much business. Everyone is heavily in debt.

A rich tourist arrives at the small hotel. He asks for a room and puts a $100 note on the reception counter, takes a key and goes to inspect the room on the third floor.

The hotel owner takes the banknote and rushes to his meat supplier, whom he owes $100.

The butcher races to his supplier to pay his debt. The wholesaler rushes to the farmer to pay $100 he owes for pigs.

The farmer gives the $100 to a local prostitute who had supplied her services on credit. The prostitute goes quickly to the hotel and pays the $100 bill for her hourly room use.

At that moment, the rich tourist comes down to reception and informs the hotel owner the room is unsatisfactory, takes his $100 back off the counter and departs.

There was no profit or income. But everyone no longer has any debt and the small town people look optimistically towards their future.”

Hmmm, has to be a catch. Or you could say, the benefits of ” Buy now, pay later” depend on good luck and good timing. I wonder if Wayne Swan had heard that story?

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