Editors' Picks — 10th May 2015

Budget Monitor, The Wheels Fall Off — Deloitte

Australia’s budget is in a poor position, and it is only getting worse. Deloitte explains that China has been driving the budget for the last decade, but now, as we observe China’s economic growth rate reach a slowdown, Australia is struggling to stop the deficit. Deloitte looks at a comparison between policy costs, expenses and economic impact on the budget to conclude that poor decisions on government policies are partly to blame.

Citizenship for sale: government explores price-based immigration system — Matthew Knott and Deborah Snow

Deborah Snow reports on new information suggesting that the government is considering selling the right to immigrate to Australia. This proposal is the government’s solution to fixing the budget. If the plan goes ahead, the government could reel in tens of billions of dollars, but Snow raises the concern that the initiative discriminates against poorer immigrants, and may restrict them from seeing their families. An open poll to readers of the article indicates a negative response to the scheme.

Interest rate cut: Treasurer Joe Hockey urges Australians to spend — James Massola

In light of the Reserve Bank’s recent move to cut rates, Treasurer Joe Hockey is encouraging Australians to increase borrowing and investing. This comes after figures showing slower economic growth; Hockey’s aim is to stimulate the economy by helping those with mortgages and smaller businesses.

Why Warren Buffett Is Torn on the Minimum Wage — Bourree Lam

Bourree Lam discusses the relationship between minimum wage and employment opportunities; if the minimum wage were to increase, what would the impact on employment be? Discussion for an increase to $15 per hour by 2020 has been considered, but economists are concerned that this will significantly affect employers’ willingness to hire workers — a scenario which will improve the situation of some, at the potential expense of many, who may lose their jobs.

Here comes the crash — Scott Phillips

“If this is bad, sign me up … great must be out of this world.” Scott Phillips claims. He bluntly states the inevitable; timing is uncertain, but a market crash is going to occur. Phillips advises that regular investment is the key to surviving the impending fall; wasting time trying to predict when it will occur is futile. Australians need to look beyond the immediate future and start preparing for what comes afterwards.