Why a Cap on Government Debt is Needed

This week, Pauline Hanson tabled a bill in parliament to bring back Australia’s debt ceiling so this parliament can start getting serious about economic management and budget repair.

Spending and borrowing are already out of control under the Coalition and we shudder to think what could happen under a Government run by Labor and the Greens.

Read the full story below:

Pauline Hanson aims to cap government debt

Matt CoughlanThe Newcastle Herald

Pauline Hanson wants to limit the amount of money the government can borrow by bringing back a debt ceiling.

The One Nation leader has introduced private legislation to parliament to set the debt cap at 35 per cent of gross domestic product, effectively reinstating the ceiling which was abandoned under former treasurer Joe Hockey.

“It is unfair and unconscionable for governments to borrow to pay for day-to-day spending and leave it to another generation to repay a debt for things they did not receive,” Senator Hanson told the upper house on Monday.

It comes after the Young Liberals unsuccessfully tried to pass a motion at the party’s federal council to reintroduce a debt ceiling.

Finance Minister Mathias Cormann spoke against the motion, arguing it would mean the government would be forced to negotiate spending with the crossbench.

Gross debt will be $561 billion in 2018/19, or 29.5 per cent of GDP, and is forecast to peak at $596 billion in 2025/26.

Senator Hanson said governments needed to be prudent during good times to position them to help the economy during the bad.

“Australia has never defaulted on its government debt but that is not the same as saying it can never happen,” she said.

5 replies
  1. Glenn Davie
    Glenn Davie says:

    It is true government debt is out of control. There is a better way, its called a sovereign banking system there is a Ted talk on this. Take the power away from the banks to create money every time they make a loan. This is the cause of unafordable house prices and inflation. The RBA controls the rate of how much new money is pumped into the country by adjusting interest rates. Give the power to the government again to create there own money. This money can enter the economy through infrastructure spending which is hundreds of billions a year. The banks will only be able to lend money that they have and not create it. Then to protect the savings of people from inflation. Like Alan Greenspan has suggested, back the peoples deposits with gold so the value of our savings goes up with the price of gold hedging us against government over spending or too much money creation. Its a win win for everyone except the banks. House prices will be much more stable and people won’t feel the pressure to take on loans that they can’t afford. This will also reduce house speculation but real jobs can be created through all the new infrastructure creating a more efficient economy. But the peoples savings must be protected with gold. If you think this sounds far fetched watch what Russia and China are doing with gold. Now is the time to attack the banks while they are on the run.

    Reply
    • gregory peake
      gregory peake says:

      Thanks for that knowledge It sounds good, we cannot keep borrowing money if the country was running at its full potential
      we would not have to borrow w we would be owed!

      Reply
  2. ken Benson
    ken Benson says:

    The debt level has become ridiculous , the amount on interest itself is lost and should have been available to purchase necessary items. I can’t believe we they say we are going great when the only way we can pay our bills is in many cases by continuing to borrow. At the age of 79 years I was always told to live within my means. This meant at times going without, saving to purchase an item when I could afford but at all times maintaining and living within my budget. I wonder with politicians in their home life do they live within their limits. Although they are overpaid for what they currently achieving. It is more important for them to maintain their place in parliament and salary than what is best for OUR COUNTRY.

    Reply
  3. gregory peake
    gregory peake says:

    Thanks for that knowledge It sounds good, we cannot keep borrowing money if the country was running at its full potential
    we would not have to borrow w we would be owed!

    Reply
  4. Alan Rawnsley
    Alan Rawnsley says:

    THEY ARE LIKE LITTLE BOYS WITH A CREDIT CARD THEY HAVE JUST RECIVED. DONT UNDERSTAND THEY HAVE TO PAY IT ALL BACK WITH INTREST REDICKLESLY HIGH 17% THATS WHEN THEY FIND OUT THAT MONEY DOES NOT COME FROM THE HEAVENS IN THE SKY, BHUT OUT OF YOUR POCKET. BUT THIS DOES NOT AFFECT THEMTHEY DONT PAY IT BACK THEY JUST RETIRE ON A FAT PENSIONAND PERKS THAT YOU AND I DONT GET BE THE WE THE PEOPLETHAT ARE THERE EMPLOYERWHO THEY JUST TREAT LIKE SHIT DONT RESPECT THERE BOSSESTHEY WILL NOT DO WHAT WE WANT THEM TO DO UNLESS THEY ARE FORCEST TO DO ITBY PUBLIC PRESURE. AS FAR AS I AM CONCERNED I DONT TRUST AND NEVER HAVE ,IN MY EARLY DAYS AS IT WAS THE END OF THE WARI LEARNED VERY BUT WHERE IS THERE ANY REAL STATES MENQUICKIIVE ALL WAYS COLD THEM PARCITES,THEY DO LIVE OF US I WOULD LOVE TO SACK THEM AND START AGIAN

    Reply

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