Pandemic aside, government spending needs to increase by at least 7 per cent of GDP

Dr Marc Robinson, an Australian, Swiss-based international authority on government finances documents how and why advanced nations are headed for a new era of bigger government during the pandemic in his latest book, Bigger Government.

A member of the OECD Advisory Panel on Budgeting and Public Expenditures and former staff economist at the International Monetary Fund, Dr Robinson has advised more than 30 countries on budgeting reforms.

Dr. Marc Robinson

Dr Robinson says although government spending has surged during the pandemic, nearly all of this extra spending is temporary.

“The real problems for governments in Australia and elsewhere are the powerful long-term spending pressures that will necessarily make governments bigger. It’s how we manage the growth that will be crucial to our future,” he said.

“Government health spending, which is responsible for approximately 70 per cent of total health expenditure, will need to grow enormously. But not so much because of the need to build better defences against future pandemics. Rather, it is mainly because of the technological revolution that is gathering pace in the health sector, particularly on precision medicine and other new technologies.

“Governments will also be compelled to spend big on fighting global warming, fixing ailing infrastructure and providing adequate aged care for rapidly greying populations. The combined effect of these and other spending pressures threatens to drive budget deficits and government debt through the roof.

“There is no way that substantial tax rises can be avoided. In this challenging context, government spending needs to be focussed on addressing real problems rather than imaginary ones.”

These and other topics such as a Universal Basic Income, elderly care provision, which is extremely poor in Australia compared to countries such as Japan, the Netherlands and Germany, climate change and infrastructure deficits are covered in Marc Robinson’s new book, Bigger Government, The Future of Government Expenditure in Advanced Economies (376 pages, Arolla Press).

This far-sighted book is about the future of public spending in advanced economies over the time horizon of the next 30 years. Its central proposition is that government is set to get considerably bigger, growing in most countries by at least seven per cent of gross domestic product between now and the middle of the century.

This rise will be triggered by major external forces and pressure points that will be very difficult to resist.

Large increases in government spending will pose a major problem for future governments and for all mainstream poles of political opinion. Robinson’s book examines the challenges and how to cope with the prospect of the relentless rise in government spending.

“With government debt shooting up in the wake of the pandemic, we must focus on the right priorities,” Dr Robinson said.

“An important message to heed is that those on the right need to abandon pipedreams of small government and those on the left need to recognise that money for costly projects won’t exist.”

Bigger Government is available at all good bookstores in hardback ($36.99) and paperback ($24.99). More information from:

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