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EYE-BALL Guru on The Great Big Financial Swindle – Part II – The ‘Budget Surplus’ Backflip – Swan tells his own Porkies …

December 29, 2012
Latest GURU Posts:

22nd Dec – The Great Big Financial Swindle – Part 1 – The ‘Budget Surplus’ Backflip – Swan serves up Senator Wong …

– 14th Dec – The Walls are crumbling – Government admits High A$ policy is hurting –

– 4th Dec – Retailers and bureaucrats don’t understand – high A$ value responsible for off-shore purchases –

– 19th Nov – Government Expenditures Part I – Department of Prime Minister and Cabinet – DPMC – STAFFING –

– 3rd Nov – Shareholders – Holding back the world – scared money – scared boss’s –

– 31st Oct – Finally – RBA bubble head opens his mouth – He says – $A intervention not needed –

– 25th Oct – Foreign Minister Bob Carr & Wife – An Australian asset –

– 25th Oct – Communications Minister Stephen Conroy – one of Gillard’s Lap-dogs – untrained and unleashed –

– 24th Oct – Climate Change Minister Greg Combet – The Carbon Tax – emissions Trading scheme –

– 24th Oct – Treasurer Wayne Swan – Mini Budget Part 3 – The Clangers keep coming …

– 23rd Oct – Treasurer Wayne Swan – Mini Budget Part 2 – Mortgaging Australia’s Future to appease his ego

– 22nd Oct – Treasurer Wayne Swan – Mini Budget Part 1 – paints a false mirage to protect his legacy –

– 21st Oct – Penny Wong – On the mid-year accounts –

– 16th Oct – The First Home Owners Grant – the fallout and a reflection on a stupid stupid Government policy …

– 10th Oct – Tony Abbott Talks the Talk – but he is on empty when it comes to detail –

To see more GURU posts:

click here …

The Great Big Financial Swindle – Part II –
The ‘Budget Surplus’ Backflip –
– Swan tells his own Porkies …

| Author: EYE-BALL Guru | 29th Dec 2012 |
Link to Part I …

Treasurer Wayne Swan joined the ALP ‘wingers’ herd when he tweeted his comments on how the rest of the world is to blame for the ‘backflip’ on the budget surplus.

Treasurer Swan’s ‘tweets’ – presented as an image below – represent his explanation to his followers, some 28.5k which is an impressive number, but nowhere near Kevin Rudd’s followers at 1.18 Million, (@KRuddMP), or Julia Gillard’s following at 323K, (@JuliaGillard).

The number of followers reflect to poll popularity in that Rudd remains more than three times more popular that Gillard.

Swan’s Tweets: (@SwannyDPM) – all tweeted 28th Dec 2012.

[Click on Image to enlarge in a new window.]

The message Swan provides in these ‘tweets’ once again screams ‘idiot’ to all those who understand the GFC and the real ’cause and effect’ – he was most certainly wearing his ‘duncehat’ when in a post Xmas stupor … he thought he would share his GFC ‘fiscal cliff’ wisdom.

The 1st and 2nd of Mr Swan’s tweets above generalise about the ‘Tea Party’ and the damage they have done to the global economy.  Mr Swan has no understanding of the cause of the GFC – he is in the middle of dealing with its aftermath – but that is akin to a mad-hatter running in circles creating a panic wherever he runs or tries to hide his overreach.

The last of the ‘tweets’ – “Australia does not suffer the same problems that plague the US or Eurpoe due to our resilient economic dundamentals” … is pure conjecture … this Nation is but a ‘bees-dick’ away from disaster yet Swan does not understand what it is he does not understand.

The Australian and Julie Bishop had something to say about his ‘tweets’ as well –

Tea Party cost us surplus: Swan

| Author: JOE KELLY| Date: Dec 29th, 2012 | Link to On-Line Story. |

WAYNE Swan has blamed the conservative Tea Party movement in the US for damaging the global economy and contributing to the “whack” to Australia’s budget position that has ruined Labor’s planned 2012-13 surplus.

The Acting Prime Minister and Treasurer used Twitter yesterday to warn that the looming fiscal cliff in the US, coupled with the European debt crisis, had directly affected Australia by reducing tax receipts, thus undermining next year’s budget surplus.

But Mr Swan saved his key criticism for the Tea Party, accusing it of holding the world to ransom and setting back the post-global financial crisis recovery for the past 18 months.

“The impact of America’s fiscal cliff saga combined with Europe’s deep problems is having a real impact on the entire global economy,” he tweeted.

“Of course, we’re seeing that impact first hand in Australia with the huge whack we’ve copped to our revenue base.

“The fact is, no matter what happens this week, huge damage has been done over the last 18 months thanks to the Tea Party’s influence. It is lamentable that so much of the world’s post-GFC economic recovery has been held hostage in such a reckless way by the Tea Party.”

Automatic cuts to social security and defence accompanied by scheduled tax increases are threatening to plunge the US back into recession, with President Barack Obama cutting short his Hawaii holiday to return to Washington yesterday to try to hammer out a solution to stop America sliding over the fiscal cliff.

Opposition foreign affairs spokeswoman Julie Bishop suggested yesterday that Mr Swan’s attack was an attempt to blame the Tea Party for the scrapping of the 2012-13 surplus guarantee and was an “entirely unhelpful” intervention into US politics.

“The US President and the US congress are trying to find a way to deal with the huge US budget deficit and record levels of debt,” Ms Bishop said.

“The last thing Wayne Swan should be doing is giving gratuitous advice. He’s hardly in a position to criticise politicians or political parties overseas about how to manage the budget.”

Mr Swan backed away from Labor’s longstanding promise to return the budget to surplus before Christmas, citing a slump in tax revenues arising from the “deepest and most sustained period of global economic turmoil since the Great Depression”.

He said the government would reassess Australia’s budget position in the new year and take into consideration the US management of the looming fiscal crisis.

Bank of America Merrill Lynch chief economist Saul Eslake said the unwillingness of parts of the Republic Party to compromise over revenues was a major cause of the current impasse, but said the reluctance of the Democrats to compromise on entitlement spending was also a key factor.

He suggested Australia could face its own version of the fiscal cliff next year, saying it was not a good time to enact any combination of large tax increases coupled with spending cuts.

Mr Swan launched a savage attack on US conservatives for their position on the US budget in September, claiming the biggest threat to the world economy were the “cranks and crazies” in the Tea Party that had taken over a part of the Republican Party.

Treasurer Swan is looking for the ‘hook-bait’ in selling the ‘budget surplus backflip’ and the attacks that will be coming his way in the New Year.

In Part I of these series’ of posts, comment was made about Treasurer Swan sending out Senator Wong to face the music and test the waters on the ‘budget surplus backflip … click here to read that post

That post included a Table where past budget results have been analysed for revenue and expenditure percentages year on year.  They paint a completely and entirely different picture to the song Mr Swan and Senator Wong are trying to sell – that Table is too important to talk about without seeing the data extraction results – it reappears below:

TABLE 1: Federal Government Budget Revenues and Expenditure growth:

[Click on table Image to open and enlarge in a new window.]

  • Link to Data Table 1: Australian Government Monthly Financial Statements – October 2012
  • Link to data table 2: Table D10: (page 367) – Australian Government accrual revenue, expenses and fiscal balance by institutional sector ($m)

As noted in Part I – the reference to the drop off in ‘revenues’ as Swan tries to promote is a complete fallacy.   The revenue growth in 2011 of 7.8%, and in 2012 of 9.6%, both  represent revenue growth ranked 6th and 3rd highest in all annual revenue growth patterns since 1996.

Revenues were not the problem Mr Swan – and for you to tell everybody it was is you directly lying to the public.

In fact – Part I also highlighted the point that for the budget deficits in 2010 [$57 billion], 2011 [$51 billion], and 2012 [$47 billion] to have been balanced  – the revenue growth needed to create such a scenario would have had to have been, 16.5%, 26.9%, and 25.9% for each of those years.  These numbers represent multiple factor increases and were completely unrealistic in their forecast.

As can be seen from the Table above – there has only been a single year since 1996 were revenue increased by more than 11%.   When Mr Swan blames the ‘GFC’ and the ‘Tea Party’ as he does in his tweets for his ‘budget surplus backflip’, he is attempting to create his own bow-wave to cover his own ass down the line … don’t let him is my advice.  This is political misdirection on a criminal scale.

To have some understanding of the ’cause’ of the GFC he would need to understand the way global trade has changed and is now linked to labour costs.   We all know Mr Swans Union background and allegiance – he tells us all so many times he is about jobs, jobs, and more jobs’.   Mr Swan talks about it but has no demonstrated understanding to what is happening to the jobs market in Australia.  He must begin to realise that with our relative high labour costs to our competitors, that Australia is becoming isolated and uncompetitive on an International scale.

The very essence of how these high labour costs have risen is linked to the allowing of the increase of the value of the A$ without central Bank or Government intervention or response.

This and the previous Government’s acceptance of the continued resource trade resulting in the high A$ policy has reduced export revenues over the last 8 or so years to the tune of well over a A$trillion dollars.

This has been the cost to the Australian economy through successive failure by Government to deal with and offset the repercussions of a high A$ value policy.   The A$ trillion cost represents more than three times the $300 billion debt created in response to the GFC stimulus funding over the Rudd/Gillard years.

Mr Swan has nothing to say about this because he does not understand the global market changes at play.

The reality – the rest of the world have themselves plugged into our high interest rate returns, our capital gain guaranteed on the currency appreciation, and on the back side of this our labour costs have skyrocketed on a global scale causing a massive repositioning of Australia’s labour force to offshore markets.   This will continue in coming years and unless policy is introduced to combat this stupid rape of the Nation … Australians will have yielded without a fight.

All the while Mr Swan has been serving as Treasurer, and even when he was Opposition Treasurer before 2007 – he was sucking his thumb pretending and wanting to be though of as the ‘best treasurer in the world’.   That ‘gong’ given in 2011 was the rest of the World’s greatest ‘thankyou’ message for the greatest fraud even committed on the Australian people.

Some Global history:

If Mr Swan was a student of history, he would know that for more than 40 years Western Government’s around the world have embraced debt as a means to get themselves re-elected.   The continual change of Government’s in each of the Nations where the GFC impacted hardest – all allowed their deficit overspend to happen on the sellable pretence they were improving the ‘standard of living’ in those Nations.

In other words, ego driven Leaders sold us all a dump saying that the election promise’s were there to serve the electorate – the truth behind that lie is that they were using the spend to first get themselves re-elected.

The number of unpopular decisions made by Government’s since the Vietnam war can be counted as few and far between – how many of them had anything to do with real economic management?

Take the President Nixon abolishment of the ‘gold-standard’ in the early 70’s as an example – this policy some 40 odd years later can be seen as the trigger event that set the economic powerhouses on its borrowing spree for the next 40+ years.

See chart below – there is plenty of debate on this issue – see Wikipedia source here

[Click on table Image to open and enlarge in a new window.]

The USA are currently dealing with the ‘fiscal cliff’ debate … they have walked themselves to that cliff willingly and via consecutive Government’s who spend, spend, and then spend some more.    The US$16.4 trillion debt ceiling negotiated with much market speculation and movement early in 2012 – is again all used up – Geithner states that it will be reached on Monday next, 31st Dec 2012 – see chart table below:

[Click on image to enlarge in a new window – click ‘Ctr+’]

This debt ceiling renegotiation is a part of the ‘fiscal cliff’ scenario, yet in the two months since Obama was re-elected there has been little or no urgency to deal with the impending crisis – this is what Swan refers to in his ‘tweets’ when he blames the ‘Tea-Party’ … yet Mr Swan wants to use this inaction as blame for his budget surplus backflip … what an idiot …

Meanwhile global markets are humming along with no real understanding that the western world is now so dependent on consumer spending that without it Nations will fall – nobody will put it in those terms – yet the consumers have decided themselves it has been better to pay down debt and save more.  Government’s are scratching their heads trying to find ways to make the consumer feel confident to go out and again spend in ways that bought about the GFC in the first place –

Talk about insanity – “doing the same thing over nad over and expecting a different result” … Albert Einstein.

The Wayne Swan gangrene:

There are economic forces at work around the globe they few can understand of predict where they will lead the globaleconomy.   Swan and his dreamboat existence as Treasurer is as far removed from this reality as anyone could be.   He likemoist wants to return to the 80’s and 90’s style economic menagement and anything different challenges him beyond his capacity to visualise the way ahead.

Every Treasurer around the world has one collective thought in how to deal with the GFC recovery – that aim is to try and convince people to spend their recent accumulated savings and their weekly earnings to ignite a spending recovery – this in a job markets going backwards in western Nations.

The Government’s around the world have filled that role as stimulus provider since 2007-08.   They have now run out of money and to now fill that breach in spending – they want people spending to fill the void.    This is a massive sell-out … an admission that the global Government stimulus has failed and failed miserably.  The fundamental flaws in the system are still there – still allowing the privileged to spoon feed themselves off the poor and less fortrunate.

They are even using the adage that interest rates have never been so cheap to promote more borrowing.   Banks are once again in full agreement as they try to sell their debt to unsuspecting borrowers.

Swan is fully engaged in this spend recovery yet – he won’t be there to experience and deal with the disaster he has help create as it unfolds – nor for the decades long hurt it will cause … he will be enjoying his life-long pension and all its parliamentry perks.

Government Cheque book:

Global Leaders believe that Government is an open cheque book to use to implement policies they think will firstly not make them unpopular, and secondly allow them to tell everybody that these spending measures, and/or policy initiatives will make their lives better.

Look to Queensland’s new Leader – when you take a desperate man/womans job away and force them onto welfare – of course they will respond … Campbell Newman’s poll numbers are almost half what they were eight months ago and he is still in his first year as Premier.   His vicious cuts to Government spending and the job retrenchments caused is the immediate impact.  But behind that is the 20 odd year ALP QL Government open cheque book policy to create jobs.  A great number of those jobs were created in public service and Newman’s agenda is to cut them back.

The cause and effect on both the former ALP Government, and new Leader Newman’s policy impact on the electorate and they vote according to how they are affected.

Government’s have become the greatest sellers of dreams and hogwash ever – they are worse than Hollywood types and have even become creative in their imagination by using hollywood actors and artists to help sell their message.   You know what – we are the bigger fools because every election we are stupid enough to believe the spin and thing that politicians don’t lie.

The nutshell – it is all a dump.  The current generation’s apathy to all things political will be paid for by our children and our grandchildren in the decades ahead.

Wayne Swan is a pathetic example of a federal politician who overreached by far, and when joined by the likes of Gillard, Conroy, Emerson, Roxon, Shorten, Garrett, and a host of other current Front Bench Ministers – it is no wonder Swan and Wong are all looking for parachutes over this ‘budget surplus’ backflip.

The Howard Years:

Even the John Howard years [1996-2007] – was out of his depth.  The latter 5 years of Howard’s term as PM were the best years of the mining boom and they were largely wasted …

The Government at the time did not know where real economic growth was happening, and all since confirmed by the lack of infrastructure upgrades in the mining towns, and the ports to cater for the expanding exports.  This proved once again that Government’s have no idea what to do with or how to spend surplus revenues.

Then Treasurer Peter Costello claims his greatest achievement was the establishment of the ‘Future Fund’ – a $50 billion strip from taxpayers to fund superannuation entitlements set up to cover previous years underfunding of public servant retirement entitlements.  What a wank and one eyed think-tank policy.

This ‘Future Fund’ gives Parliamentarians a far greater employer contribution scheme, retirement perks than any average Australian could never hope for under their own public super-fund, and all taxpayer funded.

The initial source of funds used to set up this ‘Future Fund’ came from the proceeds of the Telstra sale … the rest of the surplus’ during the Howard years was used to pay down previous ALP generated debt under Keating and Hawke.  Howard and Costello had no vision of future infrastructure needs, or of the need to upgrade State electricity grids across the Nation.

Nobody escapes blame in this unfolding human created disaster … everybody is at fault – someone once said … ‘people treat you the way you let them treat you’ …

Well it is about time Australia and the rest of the world bloody well woke up and believed that our current Government’s are treating us all as fools … the Wayne Swan excuse for his ‘budget surplus backflip’ is akin to a small child’s wanting to blame someone else for their own mistakes.  He is treating us all as if we were naive fools and hung on every word he said.   I urge you all to fight back …


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The EYE-BALL Guru …

  1. barry
    December 29, 2012 at 2:27 pm

    Seems Australia is going to vote these clowns in for another term…..America is awake to them . Why aren’t Australians?
    Still too busy at the football?


    Seems Australia just wants to give their country away …….why am I not surprised?

  2. December 30, 2012 at 8:55 am

    Barry – the video link is Tea Party propaganda … it lost me when it drew the political bar and lumped the Democrats with the Fascist’s, Socialists, and Communists …

    Up to that point I was able to absorb the rhetoric and process the agenda … for what it’s worth the GOP politician narrating the story was far too slick and rehearsed … it was a propaganda video and like the type the Nazi’s used to sway opinions against the Jews …

    In fact I’d go so far as to think that American Politics is on a collision course to self-destruction and there goes the Democracy business model for everybody …

    Great link nevertheless …

  3. david the pragmatist
    December 30, 2012 at 9:22 am

    Well if ever we needed a confirmation of Mr Swan’s economic standing and knowledge, we need look no further. Hello “the tea party” really. Why not the Republicans’ or the NRA ?
    Those pesky gun laws are not helping our “surplus” management. Why not cyclone “sandy” or anything that ruined Mr Swan’s well laid out plans that so obviously showcased his economic ingenuity.
    Well Mr Swan, you have done everything in your power to fcuk our economy and we can only hope that you fcuked that as well. The fact that the worlds’ economy is being engineered by Central Banks and monopolistic countries is the one thing he has going for him in a world of deflation and yet to come inflation (he doesn’t know that by the way). Why else would the gold price be held up in a mammoth debt structure of money printing why governments secretly stash production at current prices . Don’t worry Mr Swan you would not understand this any more than you understand the manipulation that will take place in controlling this.I wonder if he has thought of stockpiling and buying all the gold that our producers dig up, like so many other money printing economies/ countries are doing.

    I am convinced that the doomesdayers and foretellers of Amargeddon are fundamentally correct but will be proven wrong again, and again, because when the street only has bullies in it, then anyone who wants to fight them is going to get a bloody nose! Its the one thing we can predict in a world where timing is everything and is again manipulated to a level we cannot predict.

    Mr Swan you are an insignicant labour politician who has no real understanding of what is happening. If you need proof of that, you only need go as far as the “tea party”.

    Maybe blissful ignorance is his greatest strength and ally. It certainly helped him get the misnomer of the world’s greatest fcukwit economic manager or greatest treasurer. Obviously the two go hand in hand.

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