NEWSFLASH! In September I will join The Conversation as its Business and Economy Editor. I have been honoured to work at The Age for the past ten years, originally alongside the legendry Tim Colebatch, and for the past four years as economics editor in my own right.

At The Conversation, my job will be to make the best thinking from Australia's 40 univerisites accessible to the widest possible audience. That means you. From the new year I will also write a weekly column.

On this site are most of the important things I have written for Fairfax and the ABC over the past few decades. I recommend the Search function. The site is a record for you, as well as me.

I'll continue to post great things from The Conversation and other places here, and also on Twitter and Facebook. Enjoy.

Thursday, November 27, 2008

Who ran up and who paid off debt

Commenter Marek asked whether Julie Bishop could possibly be right when she said that it took the Coalition ten years to pay off $96 billion of debt left by Labor.

The figures are here, and below - click to enlarge.

Julie Bishop is right. The Coalition paid off Labor's debt. It did it by selling just about everything it could lay its hands on apart from Australia Post.

Telstra accounted for the bulk of it (although the government got a bad price for the first lot of Telstra).

Selling Telstra meant that the government missed out on its dividends. It helped government finances not at all.

It was as if a farm sold it cows to pay off its debt. It would become debt-free, but would miss out on milk and the earnings from selling it.