Thread by @davidfickling

Australia just passed a costly economic stimulus program amid a fast-slowing economy.

The problem? Most of the stimulus is more than five years away.

bloomberg.com/opinion/articl…

Most of the domestic discussion of this has focused on the very regressive nature of the tax cuts.

Which is true as far as it goes, but "regressive tax cuts" are what conservative governments do.

The far more baffling thing for me is that there's so little front-loaded benefit

The government's self-interest ought to dictate some robust stimulus, given record-low borrowing costs and a fast-slowing economy.

Instead they remain fixated on a budget surplus target despite monetary policy approaching the zero lower bound.

FWIW, more progressive tax cuts/stimulus would support the economy better, too, because cash is tighter for lower-income people so they're more likely to spend windfalls. The rich will just add it to savings.

But still, *any* front-loaded stimulus would be better than none.

The lesson they seem to have learned from the Trump tax cuts is "procyclical regressive tax cuts are good! Look at the U.S. economy!" That's the wrong lesson.

But the Trump cuts were passed towards the cycle peak. These are being passed towards the cycle low.

Indtead of making the boom boomier, they risk making the bust bustier.