Author Archives: Michael Keating

Michael Keating

About Michael Keating

Michael Keating is a former Secretary of the Departments of Prime Minister and Cabinet, Finance and Employment, and Industrial Relations.  He is presently a visiting fellow at the Australian National University. 

Why Labor should scrap the Stage 3 tax cuts

The Government’s stage 3 tax cuts due to come into operation in 2024-25 should be scrapped. They are too costly and too biased in favour of the highest incomes. Instead, there are other better ways to support economic growth using … Continue reading

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How does the 2020-21 Budget stack up?

The budget deserves a “pass”, but the government is favouring tax cuts which may not all be spent. Also much of the assistance appears to be poorly targeted to the areas which have most suffered a loss of jobs.

Posted in Economy, Politics | 4 Comments

Scotty from marketing: A fact check

Trump is notorious for his lies, but it is time that a fact check was applied to Scotty from Marketing, too. Without it I doubt  we can elevate the political debate from its present populism.

Posted in Politics | Tagged | 5 Comments

Deregulation or better regulation?

Too often the public debate is around whether there should be less regulation, but typically regulation exists for a reason, and the issue should be how to regulate more effectively.

Posted in Economy | 2 Comments

The Budget – possible additional measures

Yesterday I considered the economic outlook and concluded that on present policies the pace of the recovery post-Covid is likely to be too slow. Today’s article discusses what extra stimulus should be incorporated in the Budget in two weeks, and … Continue reading

Posted in Economy, Politics | 2 Comments

The economic outlook and the Budget

In two weeks the Government will bring down its delayed 2020 Budget. This article discusses the economic outlook and concludes that further stimulus measures will be necessary in the forthcoming Budget. The desirable size of that additional fiscal stimulus and … Continue reading

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Infrastructure Stimulus: there are smart projects out there, if we care to look

Infrastructure spending is touted as the path to economic recovery, but our leaders can no longer afford to throw billions at programs with little economic merit or policy logic.

Posted in Infrastructure, Politics | Tagged | 1 Comment

Superannuation: how much do we need to save?

A hot political issue is whether to proceed with the legislated increase in superannuation contributions from 9.5 to 10 per cent next July. There are pros and cons but if the superannuation increase is further postponed, there should be an … Continue reading

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The economic outlook and taxation. Part 2

Yesterday Part 1 of this article argued that bringing forward the second and third stages of the Government’s legislated tax cuts would achieve very little economic stimulus and would damage the longer-term fiscal position. Part 2 today considers the future … Continue reading

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The economic outlook and taxation Part 1

The Covid-induced recession has turned out to be worse than we initially hoped writes Michael Keating. Part 1 of this article discusses the additional fiscal stimulus that will be necessary and why it should not include bringing forward the Government’s … Continue reading

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We still need to provide adequate retirement income.

The current early drawdowns of superannuation balances will reduce those workers’ retirement incomes. It would therefore be desirable to allow and encourage them to restore their superannuation balances as and when they can.

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The Reagan and Thatcher legacies: sorting truth from fantasy.

Neo-Conservatives want to believe that Reagan and Thatcher achieved smaller government, lower taxes, and a booming economy. The reality, however, is very different.

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The Government’s economic response to Covid-19.

The Government’s long-awaited update of the fiscal and economic outlook contains no real surprises. But what we still need to know is what the Government intends to do next when the present economic support measures run out.

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The Prime Minister’s reform agenda for skills

Although it is good that the Prime Minister has recognised the importance of skills, missing from his reform agenda are two of the most important issues: the nature of skills and how they are taught, and the use of skills … Continue reading

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The Grattan Institute’s Fiscal Recovery Plan

The economy is presently receiving an unprecedented, but time-limited, level of fiscal support. The report just released by the Grattan Institute provides a very good analysis of what is now needed to sustain the economic recovery.

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Universities and jobs – the Government’s changes are neither fair nor sensible

The Government’s proposed changes to the fee structures for university degrees are not fair, and contrary to the Government’s assertion, nor do these changes respond to the needs of the labour market.

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National Cabinet to replace COAG: Part 2 of 2.

Part 1 of this article yesterday discussed the reasons why National Cabinet has been successful so far. Today, Part 2 will discuss how replacing COAG seek to define the future mandate of the National Cabinet and its revamped ministerial committees, … Continue reading

Posted in Politics | 3 Comments

MICHAEL KEATING. National Cabinet to replace COAG: Part 1 of 2.

Scott Morrison has decreed that “COAG is no more” and will be replaced by his new National Cabinet. Part 1 of this article below, discusses the reasons for the initial success of both the National Cabinet and COAG.

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MICHAEL KEATING.. What should we do with the $60 bn left over from JobKeeper?

The discovery of an error of $60 bn in the costing of JobKeeper raises the issue of what should be done with this money? However, as JobKeeper was always incomplete these deficiencies should be the first call on this extra … Continue reading

Posted in Economy, Politics | 5 Comments

MICHAEL KEATING. Why the coronavirus shouldn’t stand in the way of the next wage increase (The Conversation 26.5.20)

Wage increases are widely believed to pose a threat to employment. But this ignores their role in supporting demand growth. Instead, wage increases consistent with maintaining an equilibrium distribution of income are necessary to sustain economic growth and employment.

Posted in Economy, Politics | 1 Comment

MICHAEL KEATING. When should the budget deficit be unwound?

Australia’s present budget deficit is unprecedented, but it represents an appropriate response to the recession. The resulting debt does not present a future problem, and the deficit should only be unwound as private demand recovers.

Posted in Economy | 10 Comments

MICHAEL KEATING. Covid-19: What we need to know.

An international inquiry into the origins of the Covid-19 virus misses the main point: what the world really needs is an inquiry into the effectiveness of the response.

Posted in Politics | 9 Comments

MICHAEL KEATING. Update on the economic outlook

The government and its advisers expect this recession to be relatively short-lived, but the recovery may well be less complete than they anticipate and are planning for.

Posted in Economy | 3 Comments

MICHAEL KEATING. Covid-19 and inter-generational equity

The increase in public debt in response to Covid-19 will not result in an unacceptable debt burden on young people. Instead, anyone seriously concerned about inter-generational equity would support action to reduce climate change and to improve the availability of … Continue reading

Posted in Economy | 6 Comments

MICHAEL KEATING. Economic Policy post Covid-19. Part 2.

Today I address (i) how best to support aggregate demand, and (ii) how quickly to restore budget balance. In Part 1 of this article yesterday I concluded that these are the two key issues for future economic policy.

Posted in Economy | 12 Comments

MICHAEL KEATING. Economic Policy post Covid-19. Part 1.

This article considers economic strategy post Covid-19. In Part 1, today, it is argued that the principal requirement will be to generate a faster rate of increase in aggregate demand, and that Morrison’s proposed business-friendly policy settings will not help. … Continue reading

Posted in Economy | 3 Comments

MICHAEL KEATING supports Pearls and Irritations.

Pearls & Irritations is the best blog I know to find articles that keep me up to date with the findings of policy-relevant research and expert independent evidence-based assessment and comment on a wide variety of critical policy issues.

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MICHAEL KEATING. Covid-19 and Future Fiscal Policy

Covid-19 will have a big impact on fiscal policy over the next few years. The Budget balance is estimated here to show a deficit equivalent to 4½ per cent of GDP this year and as much as 10 per cent … Continue reading

Posted in Economy | 3 Comments

MICHAEL KEATING. Covid-19 and the Economic Outlook

The Government’s unprecedented cash splash to shore up the economy will save us from what could have been a much worse recession. This makes it doubly strange that the Government is so uncommunicative about the future economic and fiscal outlook … Continue reading

Posted in Economy | 3 Comments

MICHAEL KEATING. -Covid-19 and the role of expert advice

The response to Covid-19 has raised an important question about the role of expert advice in the formulation of public policy, and whether it can and should be independent advice.

Posted in Politics | 9 Comments