David Bushby (Tasmania, Liberal Party) Share this | Hansard source

Senator Conroy raises the band. I assume you are talking about the inflation band. There are a couple of ways that that can be achieved. You could achieve that by spending massively, stimulating the economy and having massively high interest rates to balance the economy and get the inflation rate between two and three per cent. But nobody would want that because, if you did that, you would have to borrow money which taxpayers would have to pay back and, on the other side of the equation, Australian taxpayers, Australian homebuyers and small businesses would be paying hugely high interest rates. But you could achieve that two to three per cent band by doing that. That is where we are heading at the moment.

However, the alternative is to not overstimulate the economy using fiscal policy. Keep the spend down, keep interest rates down and you can still get between the two and three per cent band. That is the preferable place to be. I am sure it is where the RBA governor would prefer to be—