The third cost of increased government spending is that it can be unsustainable (meaning it can cause problems if that level of spending continues) or can destabilise financial markets. The sustainability of Australia current increase in spending is not a concern because it is temporary and does not change the long run growth rate of debt. Financial stability is not a concern given Australia debt is seen as a safe haven by financial markets: this is why investors are willing to accept pathetically low interest rates for the honour of being able to finance our debt.
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