Is Public Debt Worse Than Private Debt?

Stupid Is As ... Stupid Governs

Tony Abbott ran into flack with his interview with Karl Stefanovic. You'd think an interview with Karl would be mostly soft-toss fluff balls in the morning, but no. Karl sent a question right at Tony Abbott's head, pointing out that the ALP is being about as obstructionist as he was when he was in opposition. If it worked for Tony and the Coalition, why wouldn't Bill Shorten do the same?

Of course, in the dissembling that followed, Tony Abbott said that the mission of his government was to reduce the deficit so future generations would not have to live under the burden of debt. Now, this is a very curious construction because to cut back on the deficit, his own government is proposing deregulating the tertiary education sector, whites predicted to raise student debt substantially. In other words, the Coalition are under the delusion that if the debt doesn't show up on the government's ledger as public debt, this is somehow greatly beneficial to the people who will be saddled with the debt.

What Tony Abbott is proposing is to privatise the debt right back onto the future generations. With minimal public debt, subsequent governments would look great for future politicians, but individuals would be saddled with massive private debt incurred for getting an education.

Now, I'm not suggesting public debt isn't a problem - especially if it is massive like Japan's debt. That being said one wonders if Tony Abbott has taken a closer look at the ballooning private sector debt in Australia, the repayments for which are slowing down the economy. It makes no sense adding even more on to this pile, just so the government can pretend to be doing something important through washing its hands of education funding. Clearly it's a crock.