The Government's fiscal stimulus package prevented the Australian economy from falling into a deep recession and prevented a massive increase in unemployment, according to over 60 Australian university lecturers and professors.
In an open letter released this week in the lead up to Saturday's federal election, professors and lecturers from universities across Australia confirmed their support for the coordinated policies of the Labor Government in the hope that Labor's economic achievements will be recognised by the Australian population.
In the letter, the signatories defended the Government's budget deficit which has been targeted by the Coalition in its election campaign.
"Just as a major corporation goes into debt to invest in its stock of capital, so does a government," the letter said. "Just as many householders have a debt to a bank or mortgage company, so does a government. A government has a budget deficit and a government debt, but it also has capital assets (roads, ports, better equipped, broadband etc)."
Professor of international finance law Ross Buckley, associate professor Sandra Egger and senior lecturer Gillian Moon of the University of New South Wales' faculty of law were amongst the signatories to the letter, which labelled the performance of the Australian economy as outstanding.
"We note that during a recession automatic stabilizers (increase in total unemployment benefit payments and decreased tax revenues) lead to an increased government budget deficit," the letter said. "In almost all the OECD countries there has been a massive increase in unemployment and in budget deficits. In Australia both have been trivial by comparison."
The signatories to the letter commended each stage of the Labor Government's fiscal stimulus package, including the payment of $900 which helped to boost confidence in the retail industry and the building education revolution and first home owners grant which boosted the construction industry and created thousands of new jobs.