A simple fact of macro management that Treasurer Dr Jim “chicken” Chalmers appears unaware of:
Jim Chalmers has credited record government spending and Labor’s budget strategy for keeping Australia out of recession amid the weakest non-pandemic economic growth since 1991, using the data to reject the Reserve Bank’s claim the economy is “running too hot”.
If he spent less, interest rates would be lower, there would be a greater supply response in market sectors where inflation is at its hottest and, overall, the economy would be growing better with higher productivity:
This would generate better profits and income growth for workers without inflation.
An economy is a river that ebbs and flows through different tributaries. It is not a never-changing lake that you paddle over.
By seeing it as the latter, Chicken Chamlers is only ensuring that the per capita recession runs on forever:
He is dangerously inept.
