Before we spend the next month dissecting the wrong numbers.

Australia (people, companies, banks and government therein) owes other countries (people, companies, banks and governments thereof) money. This is due to reach over a $1trillion in the next three years.

The Australian government owes the Australian people and other countries a total of $114.2bn. www.wolframalpha.com/input/?i=australia's+national+debt

The government pays Australian super funds, Australian gilt owners and owners overseas an interest payment for this.

Depending on the duration of these government bonds, the government pays different interest rates

www.bloomberg.com/markets/rates-bonds/government-bonds/australia

The interest rate is around 6% about $7bn a year. This works out around $19m a day - about 95c each per day.


So Australia as a nation of 20 million people borrows such that we all pay 95c a day. So when you assess whether they've spent the money well, think about what they've done and whether it is worth 95c today.

Psychology of the adverts.

$19m seems like a lot and $114bn seems like more. Oh dear Gillard is taking the country to the dogs.

whereas, keeping the proportions but making the numbers a bit more understandable


$1.9 seems like not very much compared to $11,400. Two thirds of a latte vs two to three months take home pay for the average aussie

Disclaimed
I can't vote
I don't think governments spend money particularly effectively
I'm not on Gillard's side cos she's a ranga

theDoctor said...

well shut up and mind your own business then

Oooh Doc - chill man chill.

I too can't vote, don't think governments spend wisely and am not on Julia's side (but not because she is a ranga), but I do pay taxes, so I reckon that gives me the right to voice my opinion and to listen to ginger poms who do the same.

If it is my tax they are spending I reckon it is my business.