So the government debt ceiling has gone. And good riddence in one sense, it was no big deal other than perhaps it helped with some fiscal discipline as governments were always likely to be a bit coy when asking for an increase the debt limit. It had the down side of creating market tension whenever the Opposition threatened to or actually voted against the rise in the ceiling, but that was always low risk.
The compromise the Greens were able to demand of Mr Hockey reminds me of Dr Evil, in the Austen Powers movies seeming a ransom of $1 million or else he would blow up the world.
Mr Hockey, no doubt, was having trouble holding back his laughter when the Greens demanded greater transparency over the budget and government debt in return for abolishing the debt ceiling. Even more laughable is the requirement that the government report to Parliament each time the debt level rises by $50 billion to explain why.
Mr Hockey must be pleased that there are suckers born every day and for him, it was the economic fringe dwellers in the Greens.
The Greens are obviously ignorant of the huge amount of information that is already available on debt, government spending and revenue. It just seems they haven’t bothered to ever look at it.
Every Friday, the Australian Office of Financial Management publishes the level of gross debt. It splits it into total debt ($300.7 billion as of last Friday) and that which was covered under the old debt ceiling ($296.1 billion). The AOFM publish their borrowing program for the week and year ahead with regular updates according to budget developments. It is easy to track gross debt on a daily basis by adding new borrowing and and subtracting when T-Notes and bonds mature. The proverbial monkey with a calculator can do it, but not, it seems, the Greens.
There is a lot of information on debt from the AOFM whose website is here: http://www.aofm.gov.au
Then there is the monthly budget update from the Minister for Finance which gives an update on actual revenue and spending by the Commonwealth for the month and the bottom line run rate verses the budget or MYEFO estimates. There is also an estimate of net debt there too, for anyone interested. The Monthly Financial Statement is here:
Then, of course there are the two fiscal highlights for the year – the Budget and the MYEFO. These are the most comprehensive updates on spending, revenue, gross and net debt. There is history going back to 1970-71 and usually four years of forward estimates on most major measures. There is almost limitless information in the array of budget documents here:
Mr Hockey must still be trying hard to hold back his laughter given the Greens demand amounts to the proverbial limp lettuce leaf.
Whatever the politics of the issue, the debt ceiling has gone.
Long live the debt ceiling!