Joe Hockey Raring to Improve on Treasurer Swan’s Performance
With the prospect of the Coalition heading the national government by 2013 growing by the day, Shadow Treasurer Joe Hockey appears ready to take on the job presently dispensed by Federal Treasurer Wayne Swan.
Under Labor's management, the Australian economy, presently worth $1.4 trillion, withstood threats of recession during the last global financial crisis in 2008 and Swan continues to preside over domestic expansion hinges largely on the ongoing resources boom.
Hockey, however, was far from being impressed and dismissive of Swan's economic policies, the core of which anchored on billions of spending that the government were necessary to sustain growth amidst the global economic difficulties.
According to Hockey, his counterpart had so far supervised the expenditure of more than $50 billion since the financial downturn four year ago, most of which he claimed were excessive.
Despite praises for Labor's stimulus spending that the OECD said reached 5.4 percent of the Australian GDP by 2009, Hockey told Reuters that he is more inclined to focus on accumulating savings, which then the country can use as a solid buffer for difficulties ahead.
The opposition treasury spokesman is convinced that volatility will continue to hound the capital markets over the next two decades and "the less exposure we have to international capital markets, the more we can rely on our own savings."
Those savings, Hockey said, will finance the country's expansion plans and can be employed as firewalls "to inoculate us from global volatility."
Growth can also be fuelled by slashing the cash rate, which would be one of the central policies of the Coalition government, Hockey said, adding that under his watch the Reserve Bank of Australia will maintain its independence.
He would work though on realising lower interest rates that would prop up the finances of many Australian households, possibly levelling the country's cash rate to that of many developed nations, which Reuters said average from zero to one.
"We have amongst the highest central bank interest rates in the world," Hockey noted.
Also, Hockey is keen on rejecting suggestions that another wealth fund similar to the $73 billion Future Fund should be established to partly bankroll federal infrastructure projects.
"A new sovereign wealth fund for Australia is a ridiculously stupid idea for so long as we have taxes that are higher than many of our competitors, when we have net debt of A$140 billion, and for so long as we have a free and open economy," the opposition stalwart argued.
In its stead, the Coalition would roll out upgrades on the existing 15-year government bonds that Hockey said should lure foreign capitals that the government can then utilise in funding its construction initiatives.
"It is important to have benchmark government bonds, and I would push the benchmark bonds - I'd like to see 30 years out there - longer dated bonds, to create a benchmark for in particular infrastructure investment," Hockey told Reuters.
And the only Labor economic policy that the Coalition would keep is the budget surplus goal, which Hockey said he would deliver each year that the Liberal controls the national government.