Tuesday, October 14, 2008

Australia unveils A$10.4b stimulus plan

Australia unveils A$10.4b stimulus plan

The housing sector is a major beneficiary. The Government will triple to $21,000 the current $7,000 first-home buyers grant for people buying a newly constructed home. Those first-home buyers moving into existing properties will receive a doubling of the allowance to $14,000.
Why pick such an old-fashioned industry to subsidise. Back in the 90s I read an article about protectionism and the Australian motor industry. Apparently, the protectionism causes a dead-weight loss to the economy of $250,000 per job in the industry. That’s why Australians drive dinosaurs like Falcon & Commodore…

How about every Australian be given a transferable voucher worth $500, to be spent on computers, software or broadband sign-up costs? And another worth $300 to spend on Australian software?
Transferable so those who already have a computer, or don’t want one, can sell it (at a discount maybe) in order to buy other stuff. And the voucher should have a short expiry, like maybe 3 months, to encourage it to be used quickly. Or, or, or.

Or why not just cut taxes to a flat 23%...

Nah, too fucking simple.

(Why is the Aussie gummint trying to stimulate the "real" Australian economy when the effects of the financial crisis on the "real" economy are uncertain, if any?)

1 comment:

Mark Wadsworth said...


I'm doing running updates on my blog about the crazy measures the UK gummint is taking to prop up house prices. They aren't quite as blatant as a straight cash payment to people to persuade them to buy into a falling market, though!