Blogotariat

Wes Mountain/The Conversation, CC BY-ND

So good, and so unexpected, has been Australia’s economic improvement over the past three months, it has wiped one-third of the projected 2022-23 budget deficit.
Or it would have, had the government not decided to give away almost half (45%) the windfall.

Overwhelmingly, Australia’s top economists would rather the budget funds measures to cut carbon emissions than cuts income tax or company tax.

They are also dead against rumoured cuts to petrol tax and the tax on beer.

Cutting petrol tax to bring down the cost of living used to be the political version of a joke. Failed US presidential candidates John McCain and Hillary Clinton both tried it in 2008.

We are about to find out whether we’ll lose a tax break worth up to $1,080 a year.

If you told someone a year ago unemployment was about to dive below 5%, to just above 4%, they wouldn’t have believed you.

If that person was an expert, and you said it would happen despite a Delta outbreak and lockdowns in our two biggest states, they might have said you had little idea of how the economy worked.

What’s the boldest thing the Morrison government could do in next month’s budget?

It would be to forecast an unemployment rate below 4% (a rate of three-point-something), then to pledge to go further, to two-point-something.