Between 1999 and 2004 there was no investment in Australia, it all went into housing and consumption all borrowed on the current account. When Peter Costello runs around saying, 'Oh we've paid off the debt,' it's like the pea and thimble trick. The Government debt or the massive private debt abroad? It's continuing to grow.
About this quote
- What does it mean?
- Keating claims the government hid private debt by labeling it a debt payoff trick.
- In plain terms
- Private debt grew while the government claimed to clear public debt.
- What can you take from it?
- Be skeptical of economic summaries that ignore private borrowing.
Where it applies
Putting it to work
Questions to consider
- How should debt be measured effectively?
- What counts as national economic health?
Another view
Private debt is not always the direct responsibility of the government.
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