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To do nothing is now a sensible option, Mr Rudd
letter published in The Australian, 11 April 2009

The large fall of 35,000 in employment in March, coupled with the raising of unemployment forecasts by many commentators, signals the first major deterioration in the job situation and outlook. What is the Rudd Government's response to a development that has been almost certain from about six months ago?

Apart from blaming the deterioration overseas, the basic strategy has been to increase government spending, at first presented as preventing a recession and now as preventing a greater fall in jobs than would otherwise occur. But the Rudd/Gillard response "if we hadn't increased spending the situation would have been much worse" is now wearing very thin and will get even thinner as employment falls much further over the rest of 2009.

It is now plain as a pikestaff that the Government's analysis of the underlying economic situation and the strategic response needed have been defective. To coin a phrase "it's time to change" in a very major way.

First, stop the additional spending and the increasing undermining of confidence about that strategy (as recognised by the more sensible G20 leaders). Second, instead of being a do-something-every-minute Prime Minister, Kevin Rudd should adopt a reduced government role by providing businesses with the opportunities to use their skills to the fullest possible extent in the terrible environment they now face. As state treasuries recommended to the 1931 Premiers Conference, “employment must be made profitable. This cannot be done by government relief works or subsidies to private industry, but only by removing obstacles to reduced costs, and by the restoration of confidence”.

Des Moore
South Yarra Vic

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