McAuley, Ian: How the deficit obsession is eroding the budget’s usefulness

McAuley, Ian

How the deficit obsession is eroding the budget’s usefulness‘, The Conversation, 21 April 2016

Over many years the budget has morphed from an economic statement explaining how the government allocates resources, to a fiscal statement. The emphasis has shifted to explaining how the government will manage the budget surplus or deficit, and therefore government debt. Over the last few years what passes for an “economic debate” has tended to focus on the fiscal deficit, as if balancing the budget were the hallmark of sound economic management. Much of the detail about appropriations has been dropped …

Emphasis has shifted from explaining “what is the government doing with our taxes?” to “what is the government doing to manage its finances?”.

The author blames the change on ‘the economically impoverished framework of “public choice” theory’ which ‘sees government spending as a necessary evil’.

Similar: five budget myths that refuse to die written by five academics in The Conversation. Myths include small government is better, any tax increase is harmful and government budgets are same as household budgets.

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