..we should all realise that the possible reason why the US and Australia escaped a recession in 2023-24 was due to higher Govt spending, higher immigration and public sector employment expansion. The Govts knew that private sector economy was and is still weak and only through Govt intervention did the economy muddled through rather than falling into an abyss.
..but the outcome of that was higher and protracted inflation creating a higher cost of living, which necessitated rates to be kept higher for longer.
..but most people took their jobs for granted and blamed the Govts for higher cost of living issue.
..except that they had not realised that you have to have one (higher cost of living) for the other (lower unemployment)...and people often only think for themselves rather than the collective lot. So all the large Govt recruitment to improve public service was kind of engineered to keep semblance of a decent economy but at least provided jobs that would have otherwise shrunk given that the private sector was already well into retreat. People who are holding their jobs are holding with dear life, because those who lost it would have much difficulty find one, and one that offers just as good remuneration.
..so if the Govt of the day, i.e Trump and possible under Dutton's Libs, they want to shrink the public sector to remove wastage, they can by all means but they have no qualms spending millions on consultants/advisors and related parties. Does the common man/woman benefit from this? You figure that out. Public servants have no skill sets readily to join the private sector which is ridding of administrative type work.
...today my newsletter writer warned of impending recession resulting from Trump's twin policy of public sector shrinkage and lower immigration, a demand void that is created with relative ease and unlikely to be offset fast enough by Trump's hope for higher FDIs into America to avoid tariffs. And his tariffs on imported goods, especially from cheaper nations like Thailand etc will certainly result in higher domestic inflation.
...so who are the losers? Average public servants (even though bought out) who have to face higher cost of living, with little asset to benefit from any asset inflation.
