Originally published in The Australian Financial Review on May 31, 2012

The idea that the Coalition would oppose an increase in the Commonwealth’s debt ceiling makes about as much economic sense as its hostility to a market-based mechanism to address climate change. But, as with most of Tony Abbott’s big calls, it clearly makes good short-term political sense. In an age of slogans it is much easier to argue that government debt is bad than to argue it is good. But macro-economic variables are neither superheroes nor villains, and making good policy decisions is a bit harder than picking who to barrack for.

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