The Treasurer, Scott Morrison, says there is a “terrible risk” that Australia’s economic success has sown the seeds of complacency.

In a speech to Bloomberg, in Sydney, Morrison said there was a new divide in Australia between “the taxed and the taxed nots”. He warned of the complacency of a generation that “has grown up not ever having known a recession” and an attitude where “deficits are dismissed as temporary, cyclical and self-correcting”.

Morrison said there were three things the government must do over the next three years.

Firstly, it must “get debt under control by returning the budget to balance”.

Secondly, it must “support and implement policies that help us to increase what we can earn as a nation..in a low growth, low interest rate, low inflation, low wages growth, volatile world”.

Thirdly, Morrison warned against a return to “renewed protectionism” and an attitude that “trade, investment and positive immigration policies are increasingly seen as the problem and not the solution”. Whilst many Australians “feel the system no longer works for them”, Morrison cautioned against a cynical and populist political endorsement of this sentiment. “We cannot pull the doona over our head,” he said. “Rather than secure our economic future, it will cost it.” [Read more…]