Recession In Australia Essay

Decent Essays
not have otherwise got, at perhaps lower levels of penalty rates than they would have wanted, but they got a job.
In the end, the greatest social dividend from good economic management is full employment. By dismantling industrial reforms, Mr Rudd’s government was arguably adding to unemployment.
Although the government at the time delivered fiscal stimulus programs, which were subject to criticism, there is no doubt that Australia did not end up down the same path of its fellow advanced economies.
Some recession is avoidable and, as I have mentioned above, Australia fared extremely well compared to other developed countries. That was the good news. The bad news, at the time, is that the Australian government, through the decisions it procured, made it worse that it might have otherwise been.
…show more content…
As I have touched on earlier, one of the causes of the GFC and why the sub-prime came about is because people were essentially leant money when they could not repay it. Too many people were given keys to these houses without any real capacity to service their loans. Obviously, this was not the only reason for the meltdown but it certainly played a very big part in the crisis.
If a government wants to help a poor person buy something, it is preferable that they give that poor person a cheque off the bottom line of the budget and not have the banks and financial institutions lend that poor person money in circumstances where he or she can never repay the money. If you securitise something that is a sound product, then the end result of that securitisation will not be as bad as the end result of the securitisation of something that is a dud product in the first place (e.g. sub-prime
Get Access