There is apparent surprise that real incomes are falling after years of public sector waste and the diversion of our resource base into junk expenditure (NBN, pink batts, school halls, etc). But who understands any of this since now the Treasurer, seeing things going badly, has stated there will be no more cuts to public spending. That’ll fix it.

Really, he is a captive of the ultra-Keynesian Treasury and nothing is going to change.

“We have always got to live within our means but we’re not going to have cuts — new cuts — to make up for revenue shortfall due to external challenges,” the Treasurer said.