Readers will know that for some time now I’ve been arguing that the Turnbull Government has been getting bad advice from the RBA and Treasury that it needs to urgently do nothing lest it upset the horses. Here it is in black and white from Laura Tingle at Domainfax:
While a push on the participation issue suggests the government is looking for major savings in the welfare budget, federal cabinet has been warned by Treasury and the Reserve Bank that uncertainty about the economic outlook at home and abroad means it shouldn’t seek to make any really radical short-term changes in the budget which might undermine confidence and growth.
We need to ask ourselves how it is that we ended up in a position in which reform paralysis is the preferred economic path when everyone knows that the precise opposite is the real truth. Indeed Glenn Stevens himself acknowledged as much, also from Domainfax
