The Issue: Former treasurer Joe Hockey’s warning for everyday Aussies: ‘Massive household problem’
He is sounding the alarm just days before the Reserve Bank’s next interest rate decision.
Former federal treasurer Joe Hockey has predicted government overspending will grow into “a massive household problem for everyday Australians”.
His warning comes just days before the Reserve Bank makes its next decision on interest rates and adds to warnings from economists about the potential for a recession.
Hockey tells 7NEWS podcast The Issue that “a significant economic downturn” is now needed to force the kind of spending cuts he believes are necessary.
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By continuing you agree to our Terms and Privacy Policy.“Governments can’t keep spending all the money they (currently spend) and they’re going to have to make some really tough decisions,” he said.
Hockey was the Abbott Government’s treasurer for two years and produced one of the most unpopular federal budgets this century.
“When I delivered a tough budget in 2014 and populists everywhere shouted it down and undermined it … government expenditure was less, government tax was less and the public service was 50,000 people smaller than it is today,” he said.
“So if it was a crisis in 2014, which it was - if it was a problem back then - it is a very significant crisis today. And the problem is that no one’s talking about debt reduction.”
Inflation, according to Hockey, is “locked in.”
“I think this is really dangerous. And it is frighteningly looking more like the late 80s than it should … because governments are just spending too much money,” he said.
These days Hockey is better known for his four years as Australia’s “Trump whisperer” - Ambassador to Washington during Donald Trump’s first term in the White House.
In his interview with The Issue, Hockey is critical of Trump’s second term on several fronts, including being “appalled at what President Trump has done with Russia and trying to get an outcome on Ukraine”.
However, the former Ambassador remains broadly supportive of the President.
“Despite what people think, he’s really smart. And he does have a strong moral compass,” he said.
“The one thing you can say about Donald Trump is he’s authentic. What you see is what you get.”
You can catch more of The Issue on Listnr or watch full episodes on our YouTube channel.
Originally published on 7NEWS
