Posted on 03/23/2011 10:31:23 PM PDT by Dundee
A NEW study names Australia and New Zealand the leaders in "fiscal responsibility" among top industrial nations, while the United States plumbs the lower rankings at number 28.
The Sovereign Fiscal Responsibility Index, developed at Stanford University, said mounting indebtedness and budget deficits put the United States in a class with troubled economies like Ireland (number 29) and Italy (27).
But Australia and New Zealand, followed closely by Estonia, Sweden, and China, stand at the top for their capacity to maintain strong fiscal balances decades into the future.
"There is great potential for a fiscal crisis in many countries, including the United States, if they don't start addressing the structural deficit challenges that lie ahead," said David Walker, the former chief US government auditor who oversaw the creation of the index...
The SFRI weighed 34 members of the Organisation of Economic Co-operation and Development and the four rising "BRIC" economies - Brazil, Russia, India and China - on a mix of current fiscal strength, fiscal sustainability over the next 40 years, and transparency in fiscal governance.
Unsurprisingly, countries with high reserves, low debt and balanced budgets generally ranked high.
Powerful economies with high sovereign debt levels like the US, Japan, Germany, and France were all in the bottom third...
Supported by Mr Walker, who was US comptroller general from 1998-2008, the study is likely to feed into pressures on the Barack Obama administration to cut spending in order to move toward a balanced budget.
"The US needs to engage in comprehensive and timely reforms to restore fiscal responsibility and sustainability and to avoid a debt crisis that would be felt around the world," the study said.
"Countries such as Australia and New Zealand that have implemented strong fiscal rules have seen declining debt levels and reasonable government spending."...
(Excerpt) Read more at theaustralian.com.au ...
Who implemented the private retirement account idea in Australia?
When I first saw the projected required tax brackets over the next 20-years to even pay the interest on our debt, I actually began looking at Australia as a last ditch effort if things truly collapse here in the US.
Turns out my jobclass would grant me favortism through their immigration system. (Yet another thing the US miserably fails at currently is focusing immigration on core needed industries).
I hope it never comes to that, but our politicians have been massively irresponsible for decades on end and our populace now entirely dependent on government.
I can’t call Australia a bastion of freedom, but economic realities are realities.
Ping
Funny enough, it was the Labor Party (the Australian equivalent of the Democrats in the US) in the 1980's and 90's and supported by the Liberal/National parties (equivalent to the Republicans).
We've got something like $1.3 trillion in our superannuation system (about 100% of GDP). It will certainly reduce the amount we will need to spend on the public pensions over the next 30 years.
I believe it was Paul Keating (I could be wrong) who was a Labor leader. He was once called, by former PM Bob Hawke, as the “World’s Greatest Treasurer “. What he was was a smart economist who foresaw the approaching baby boomer aged pension dilemma and did something about it! Despite his obvious leftie leanings I found him at least consistent with his economic credentials .
Mel
I’ve gone through much of the same thought process and landed with Australia as my favorite. My son goes off to college this spring and I’m thinking of taking a temporary assignment in AUS in the fall to test the waters.
Is this something of an Aussie ping list?
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