stoush.net

Sat, 04/08/2007 - 7:31pm — alex white

“The states are going into debt. My point simply is that if you go into debt, you have to borrow to finance that debt and when you borrow to finance that debt, you put upward pressure on interest rates because you compete with private borrowers.

“The federal government is not doing that. State governments are doing that, that’s the point I was making.”

Any right-wingers care to explain the economics behind Mr Howard’s statement here, given that state governments borrow in the international markets? Is Howard suggesting that the deficits run by a few Australian State Governments seriously reduces the total amount of finance available globally (or even in Australia)?