The deal reached between the Australian Government and the Greens to abolish the Commonwealth's debt ceiling (here, here) seems sensible to me. It avoids a US style deadlock, while providing some additional information on Commonwealth government finances.
As I said at the time, the Opposition's stance on this one seemed silly to me. Leaving aside the substantive issues, from a purely tactical viewpoint it denied the Opposition a chance to appear reasonable at a time when they have dug in to oppose the Government on other issues. We are all such reasonable people. We don't oppose just for the sake of opposing, that sort of thing. Meantime, the gap between Government and Opposition in the opinion polls has narrowed.
Its probably also time for me to revisit the Hilmer review in a historical context because its local impacts fall within the scope of the history of New England that I am writing.
As an aside, the photo of Mr Abbott comes from The New Daily story (link above). I have been struck in a few recent photos at the way he seems to have suddenly aged. The physical demands placed upon modern political leaders are very high.
Yesterday, the Australian Bureau of Statistics released the latest national accounts data. This showed estimated growth in GPP for the September quarter of o.6%, with annual growth of 2.3%. The figures were a little weaker than some economists expected, leading to phrases such as "weak growth."
I took a different view. If you look at the graph from the ABS for quarterly GDP, you can see how growth peaked, fell and then flattened. My feeling is that we have come through the end of the the mining investment boom better than anyone might have expected, with economic re-balancing underway.
The Australian Reserve bank remains concerned about the high level of the Australian dollar. However, this is highly likely to fall as quantitative easing comes to an end in the US, and that will happen.
A lower exchange rate is not a total blessing, for it will force up costs and reduce real incomes in the short term. As part of the process, Australian interest rates will rise next year. However, the net effect of all the changes is likely to be better than expected economic growth over 2014.
One side-effect is that Commonwealth Government tax revenues will rise. Just as we saw constant over-estimating of revenue in the immediate past, I wonder whether we will now see underestimation of revenue? It's already happened at state level because rising house sales mean that stamp duty collections have been greater than projected.