Flat White

How even Xi Jinping gets something this budget

12 May 2021

5:47 PM

12 May 2021

5:47 PM

In all the lists of budget winners and losers, one name has been missing: Xi Jinping. Yet China’s President for Life has done very well out of this budget; very well indeed.

The budget talks of trillion dollar debt and interest payments of $20 billion dollars a year. If we get inflation or an increase in interest rates, Australia will be fiscally feeble for a generation.  And just the fact that so much money will be unable to be used otherwise is good news for the Chinese Communist Party. Think of all the cruise missiles, ships, drones and other aircraft, cyberwarfare capability and, yes, even submarines that could buy.

The debate has vanished into the mists of time, but debt and national security became an issue during the 2012 United States presidential campaign.

“A nation with our current levels of unsustainable debt … cannot hope to sustain for very long its superiority from a military perspective, or its influence in world affairs,” Admiral Michael Mullen, a former chairman of the Joint Chiefs of Staff, said in September of that year.

As the polls loomed nearer, CNN reported:

The national debt was not on the official agenda for the third and final presidential debate, which focused on foreign policy.

But both President Obama and Mitt Romney acknowledged … what a chorus of former military leaders, current administration officials and fiscal hawks have been saying: that the country’s debt is a threat to national security.

If … debt continues to grow unbridled, the US government will be constrained in its ability to pay for what it wants to do militarily and diplomatically. And it could limit the country’s leverage with foreign powers.

CNN quoted Lawrence Korb, a senior fellow at the Center for American Progress who served as assistant secretary of defense under Ronald Reagan as saying:

You can’t be strong around the world unless you’re strong at home.

Australia obviously isn’t the United States. We’re a deputy sheriff, but we live in a dangerous neighbourhood.

And a dollar that goes on debt payments is a dollar that can’t go elsewhere, be it in tax cuts, social welfare spending — or national security.

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