Malcolm Turnbull (Wentworth, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

My question is again addressed to the Prime Minister. Given higher Commonwealth debt means job-destroying higher taxes and job-destroying higher interest rates, isn’t the Prime Minister borrowing and spending money that has created no jobs today but will certainly destroy jobs tomorrow?

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

The Leader of the Opposition would be aware that most mainstream economists and most leaders of business organisations in Australia have said that, in the midst of a global financial crisis and a global economic recession, the responsible thing for governments to do is to go into temporary deficit on the basis of temporary borrowing. Those opposite, if they were faintly honest about their own position and the costs associated with their own position—which we calculate to be $180 billion worth of undertakings on their part—would agree that they would be in precisely the same position. Let us just be honest about this in this chamber. Those opposite are pretending that at this point they would not be in deficit. That is untrue, because those opposite would be confronted with exactly the same reality that we have been confronted with in government with collapsing government revenues. So either you balance the budget in terms of the necessary recourse to borrowings or you simply act irresponsibly in the current global economic environment. Those opposite, presumably, would have us act irresponsibly.

The bottom line is this: whether it is the International Monetary Fund, the Business Council of Australia or the Australian Chamber of Commerce and Industry, every responsible mainstream business organisation stands up with the government to say that, in this time of national economic emergency, a global economic recession which is washing across the shores of Australia, this is the time for governments to engage in temporary deficit and temporary borrowing in order to provide economic stimulus to the economy. The result of that is to cushion the impact of the global economic recession. The alternative on the part of those opposite is this: to simply throw people to the wolves; simply allow them to fend for themselves, as they would have working families do under their prescription on industrial relations.

Our policy on these matters is clear; those opposite seek to evade their responsibilities on this and not be clear about the extent of their own undertakings by way of policy, where that would land them in terms of deficit and the recourse which they would then have to undertake by way of temporary borrowings. We stand with the mainstream business organisations of the nation, acting responsibly to cushion the impact of the recession now. The relative economic data on Australia in the fourth quarter last year measured against most of the rest of the OECD demonstrates the positive impact which a temporary stimulus has. I would recommend to the Leader of the Opposition that he look hard at the examples which come from overseas and that he own up, directly and honestly, about the impact that his own undertakings on policy would produce in terms of deficit and debt.