Posted by The annual budget season seems to have become a time for nonsense.
I suppose that’s politics, and to some extent we should ignore it all – after all, they are just ‘playing the game’ – but there’s one bit of budget nonsense that is really annoying me, it is the line that goes:
‘this budget is good for retailers, and also creates additional space for the RBA to cut rates.’
The only budget measure that might do that is supply side reform, and that’s not what we got.
May 6 — Julia Gillard
“This payment will be good for our economy as well because it will help . . . the retail sector,” Ms Gillard said.
May 8 — Wayne Swan
“Surpluses that provide a buffer against global uncertainty, and continue to give the Reserve Bank room to cut interest rates for families like it did just last week”
The disrespect for the average person that the blatant double-talk implies is staggering. They treat us like we are all have gold-fish brains…
ricardian ambivalence 
Sorry but a contractionary budget allows for for rate cutting and this is a contractionary budget.
Supply side reform would be marginal as most of the hard work has been done.
Just how low do you think NAIRU could go to if you could get further labour reform passed?
Single minimum wage and set of conditions without any unfair dismissal = 4%
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unfair dismissal is a furphy but reducing the minimum wage is very hard without government support alah 5 economists proposal.