Ryan Bridge: Should we care what the IMF thinks?
Follow
the podcast on
Don't you find it annoying when some economist or think tank or some 'group' comes to our country and tells us what they think we need to do to make it better?
There's the odd case where you'd want to listen. Former world leaders, current world leaders, banks who lend you money, rating agencies who dictate your cost of borrowing.
But your OECDS, IMFS and World Banks and United Nations?
They all come down here, someone tells them we don't have a capital gains tax and they say, uh, well, you guys need a capital gains tax.
And raise your pension age.
The IMF is here doing this right now.
They outline the problem - we have structural deficit. The government spends more than it earns.
It's borrowing money from the rest of the world just to keep its head above water.
It's struggling, pay-cheque to pay-cheque, taking out pay-day loans to cover the in-betweens.
It's gotten so bad, as I told you earlier this year, next year, $5,600 of the taxes you pay as a household will go straight to paying the interest bill on our debt.
That’s five and half grand a year, just in interest!
More than we spend on schooling our kids through primary and secondary.
Debt servicing is now the fourth-largest line item on the Government’s books, according to Treasury.
So, enter the OECD, or the IMF, or the OEIMF.
Their solution? A comprehensive CGT could raise the equivalent of 1% of GDP, roughly halving the country’s fiscal deficit.
A deficit, they say, we should pay down.
The problem with demanding more tax to pay for bad spending is that it encourages more waste and gluttony.
It's like gorging on fast food, paying for the skinny jab, then getting fat all over again.
You don't learn discipline. No consequences.
And once the next structural deficit inevitably arrives, you know what IMOECDS will recommend.
Another tax.
Take your Radio, Podcasts and Music with you
Get the iHeart App
Get more of the radio, music and podcasts you love with the FREE iHeart app. Scan the QR code to download now.
Download from the app stores
Stream unlimited music, thousands of radio stations and podcasts all in one app. iHeart is easy to use and all FREE
