Government Surpluses Strangle Economic Wellbeing
Channel: PEGS Institute
Date: 2024-03-11

A short clip from a longer video: https://youtu.be/BSNmNTl_BZo
Or watch the full series to get the full perspective: https://www.youtube.com/playlist?list=PLMUzeMKhbl10X-XzH-6q4iU0Ysul7cC4c

Original description:
Australia’s gross household debt to income before tax ratio is the second highest household debt burden in the world. But how did Australian households become so indebted and what will this mean in the coming months and years?

Research from the Reserve Bank of Australia shows average personal debt more than doubling from $106,000 in 2001, to $350,000 in 2019. Average mortgage debt among older Australians has blown out by 600 per cent since the late 1980s, and that’s after accounting for inflation. 

We should not allow ourselves to forget that in practice, the government taking a larger share of the debt burden has led to better outcomes for the Australian people than austerity principles that heap the debt burden onto households, and businesses. It is hard to say that the government is effectively serving the people when now, more than ever, Australian families are suffering under the weight of unsustainable private debt. The security provided by the government deficit approach enables a brighter future for Australian households, families and businesses.

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Sources:
Total Credit to Private Non-Financial Sector, Adjusted for Breaks, for Australia - Federal Reserve Bank of St Louis - https://fred.stlouisfed.org/series/QAUPAM770A 

https://www.abc.net.au/news/2019-10-18/household-debt-leaves-australians-working-longer-spending-less/11608016

https://www.abc.net.au/news/2019-08-27/mortgage-debt-causing-older-australians-distress-study-finds/11450958

https://www.abc.net.au/news/2016-06-17/fact-check-is-wage-growth-lowest-on-record/7505512?nw=0

https://www.abc.net.au/news/2020-08-30/liberal-party-of-robert-menzies-proudly-delivered-large-deficits/12609876

The Deficit Myth by Stephanie Kelton

https://www.businessinsider.com.au/australias-household-debt-is-now-one-of-the-highest-in-the-world-2018-1

https://www.abc.net.au/news/2018-01-18/household-debt-extremely-elevated-and-tipped-to-grow/9340880

https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/rp1819/WageSlowdown 


Credits:
Written by PEGS Institute

Spoken by Andrew Johnson
Edited by Jackson Winter

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Music
Passage by Ugonna Onyekwe
A Rising Wave by Jeremy Blake
1940's Slow Dance (Sting) by Doug Maxwell, Media Right Productions