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i cant even begin to describe how much of a stupid idea this "stimulus plan" is. how about putting it toward very labour intensive infrastructure projects? or possibly to help out small business as they are the major employer in this country?

I see some merit to it. I know I will think since I put, say $500 to my credit card I will be more likely to spend an extra $20 on a DVD or CD this week or next and I dare say there are others out there who may do this.
The stress of a bill or debt is alleviated (albeit temporarily) because a large payment was made at once, thus encouraging small splurges for a while. So I may not go out and spent the full amount in one go, but instead spread it out over a longer period.

I agree, I will probably do the same

How much is that splurge going to total though? How far does ~$1000 go in an individual's pocket, as opposed to spending the lump sum on really stimulating the economy through job creation. Most of the money we spend (either on paying off debt or on small luxuries) will head straight out of the country anyway.

Post by Daniel

How much is that splurge going to total though? How far does ~$1000 go in an individual's pocket, as opposed to spending the lump sum on really stimulating the economy through job creation. Most of the money we spend (either on paying off debt or on small luxuries) will head straight out of the country anyway.

In the long run, even if it gets sent overseas, it is still stimulating the economy in terms of import/export business.

Keep in mind the idea of this is to inject money back into our economy - no matter how it is spent. People who use it to clear debt will be reducing the financial pressure on their households, freeing up money to spend. People who use it to buy things will be putting it straight back into the economy.

It might seem worthless to us, but think of the businesses it will be helping who are hanging out for someone to buy their products but have experiences a slow down in business due to the economic downturn? Business who are now paying higher rates for importing, and the products they sell.

This will help - even if it just seems like the government is throwing money away. We can't avoid the recession, but we can try and make it as easy on us all when it does come to pass as possible. In the end, unless the US turns around, we will all be looking to local business for our products as soon enough it will be far too expensive to look overseas.

We are quite lucky to be in a position where we have our own resources in terms of livestock and fresh foods. Consider places like Japan where they have virtually no natural resources or farming and have to import everything.

My beer and pizza has turned this into a rant, sorry.

My point was that injecting money back into our industries no matter how it is spent will help keep the giant flowchart of events moving.

Mmm Beer and Pizza, a good way to spend my stimulus :D

Post by Danica

Keep in mind the idea of this is to inject money back into our economy - no matter how it is spent.

Is billions of dollars in debt, as the government is borrowing this money, and spedning it in a scatter gun approach honestly the most appropriate of measures? As opposed to spending it a very concentrated way. An individuals contribution back to the economy, whether by way of reduction of personal debt or direct spending, won't bring back the thousands of jobs already lost nor prevent a rise in the unemployment rate.

Take the pink bats investment. Yes, there'd be some benefit to that. And a few Australian companies will make some money out of it, and their installers shall as well. But that's rather concentrated. And the pink vats? They'll be manufactured overseas. It might seem protectionist, but don't we have a few thousand people now unemployed who would be more than capable of aiding the production of said pink vats? And call me scepticle, but pandering to the green vote in a state facing an election (Queensland will be the biggest beneficiary of the vat installation program) seems like a politically slanted agenda to me.

It might seem worthless to us, but think of the businesses it will be helping who are hanging out for someone to buy their products but have experiences a slow down in business due to the economic downturn? Business who are now paying higher rates for importing, and the products they sell.

Why not then follow Obama's model, and specifically promote 100% Australian products which have come into existence as a result of the stimulus package. That's going to have a far greater impact upon business, big and small, and the Australian people than a product which is imported from overseas especially given 50% of the ticket price of a good many imports goes directly overseas.

This will help - even if it just seems like the government is throwing money away. We can't avoid the recession, but we can try and make it as easy on us all when it does come to pass as possible.

It's not an issue of whether or not it's right to spend; we need to spend. It's an issue of how much and how. The announced stimulus packages account for 5% of Australia's GDP, the US has seen fit to only spend 2.9% of its GDP. It's also seen fit to spend it in a much more targetted way; even the rescue packages there have had far more clauses attached to them in Australia (consider Pacific Brands who took a package from the government and then went on to sack their workers).

We could be spending the same amount of money on infrastructure to future proof Australia; that would directly create jobs.

We could spend the money on new dams, after all this drought isn't going anywhere.

We could spend the money directly creating jobs.

We could acknowledge the fact that the last stimulus package back in December did very little to help the country; unemployment went up and the retail market still shrunk.

And if that were seen as too protectionist to direct the way the money is spent, we could actually put some hard work into ensuring the money is targetted in even the simplest of fashions. For instance, we might choose not to deposit the money into the bank accounts of dead people or Canadians. Or in fact, we might just stop it going overseas to begin with by not sending it out to close to 70,000 people.

And while we're out there being clever we could look at things like the workplace reforms and carbon trading schemes that most people are backing away from, yet this government continues to pursue. They surely aren't going to help grow the economy in its time of need? Even the unions are backing away from the severity of the workplace law changes knowing that it's going to cost jobs (though they claim only in the short term - hate to break it to them but those Pacific Brands jobs are never coming back).

Daniel: I agree that its not the best way to try and tackle the issues - all of the points you've made about job creation etc are good ones. What I was trying to say on my beer and pizza clouded rant was that while it's not going to fix everything as effectively as making changes in other areas will, the payment will help a lot of Australians who are struggling because of the downturn.

We can look to the US for the examples it is setting in attempting to keep industries and companies alive by 'bailing' them out, but ask many of those struggling in the US and I bet they would say they would prefer a small payment from the Government rather than see it go to all the corporations who have already proven they suck with money.

I think we all know that this isnt going to solve the problem. I just think its a way to try and help those who have been hardest hit.

Yes there have been some big arse ups in the payments so far - but the rush rolling out of all this was bound to have some mistakes in it. I dare say the amounts paid out in error will be minuscule compared the millions that are going to spent on trying to get things back on track in the next few years.

BUT... This is a big issue. Many people are either for or against it. And like with most major political issues, no one is ever going to agree. I know what you are driving at, but I don't believe it's a total clusterfuck of an idea.

Although there are most definitly more things that this lump sum of money could be spent on (there is absoultly no question of that) the government have thought this out and believe they have made the right decision... therefore I believe the only thing we can do as consumers is be grateful for the gift of free tax-free money. I dont know about everyone else, but for me the biggest thing this recession has affected in my life is my overall budget - making my money streched further than it can actually go making it increasingly difficult to make my debt payments on time. So of course I will be so excited to be able to make such a large deposit on it in one hit, although in saying that if I have managed to get x amount payed off by the time my cheque arrives I may decide to take myself on a shopping spree. I am not discounting or meaning to be selfish or cold hearted to anyone else, I can see everyside of this argument, but you see I am just choosing to be grateful for what I have got and what I am being given whilst also being enlightend and educated on the matter at hand.

Thank you very much for the information, totally appreciate it!

i dont think the government thought this out at all..i think they were thinking "oh no we are screwed, now how can we do this while still making sure the public are happy with us? oh right, lets throw money at them and the happy masses will be louder than the intellegent ones who realise this is stupid".
i think infrastructure is the way to go, not helping us all pay our credit cards.