The Australian Budget matters to us. The extent to which we haven’t descended here into a complete black hole of economic depression is in large part because of Australia’s still ongoing resource boom.
But Kevin Rudd and his Treasurer Wayne Swan are doing their level best to kill that particular golden goose. Last night’s Budget saw them sharpening the axe as they prepare to carry out the plan to decapitate the miners in order to drink their blood.
The tale can be told in four excerpts:
From this morning’s Australian newspaper, we read the budgetary boasts of Kevin and Wayne who, despite still spending like water, are making far-out promises of balancing the budget:
“Government debt is forecast to return to zero in 2017-18 - also three years earlier than previously predicted. Mr Swan predicted that the budget deficit, already down from $57 billion to $40 billion in 2010-11, would turn to a bare surplus in 2012-13 of $1 billion. “We have to grow together and maximise growth,” Mr Swan said.
From yesterday’s Herald Sun, we find out just how this fantasy is going to be funded. Not by ending Australians delusions about their taxpaid “entitlements,” but by finding a new sap to fund them: by soaking the miners:
“[By] the resources rent tax (RRT) , or as it is dishonestly titled, the resources super profits tax …
“It is not petty cash. The RRT will [they hope] raise $3 billion in 2012-13 and $9 billion in 2013-14 - the last two years covered by the official budget forecasts.”
And from the Herald Sun, we see how illusory those figures (and this recovery) are going to be.
“Fully half the $30 billion the Government claims as ‘savings’ over the next four years came not from real savings but from just two last-minute grabs for cash.
“Nearly $5 billion is to come from smokers - for their own good, of course - and another $12 billion from miners, thanks to the new ‘super profits tax.
“These are huge figures, and the mining tax depends crucially on there actually being ‘super profits’ left to plunder.
“If China’s growth stalls and our mineral exports shrink, Rudd’s forecasts are finished. If the miners, furious at Rudd’s smash and grab, keep announcing the cancellation or deferral of big projects in response, his tax take will shrivel, and our economy with it.”
And the miners? They’re already shrugging, as a local blogger spotted:
‘As they will say in Oz: "Where the bloody hell did ya go...?"’
“Well, apparently now its going to be Africa and other parts of Asia.
“Anywhere but the super funds of working Australians.
“Australian Prime Minister Kevin Rudd has managed to put a spanner in the works of that troublesome mining industry with his fabulous new taxes.
"Rio Tinto shelves billions in projects”
”MINING giant Rio Tinto has shelved plans to spend $11 billion expanding its massive iron ore operations in Western Australia because of the wave of uncertainty sparked by the Rudd government's proposed tax on super profits."
If there’s anyone anywhere who really believes that Kevin and Wayne will manage to steal enough from the miners to backstop their budget deficits, without sending their economy’s backstop off-shore in pursuit of safer profits, they probably need their heads read.