Nick Sherry (Tasmania, Australian Labor Party, Assistant Treasurer) Share this | Hansard source

Thank you for the question, Senator Coonan. Firstly, this government makes no apologies for the introduction of the bank guarantee. We make absolutely no apologies for that. One of the important lessons that the Rudd Labor government learned from the Great Depression is that there are three important broad policies to put in place. The first is to guarantee your banking system, and certainly the circumstances we saw last year necessitated a guarantee of the banking system. Without confidence in the banking system the economy, as we faced last year right around the world when bank guarantees were being implemented, faced collapse. That would have been cataclysmic. That is the first, and we make no apologies for that.

The second is that you deliver stimulus packages. You do not, as occurred in the Great Depression, cut pensions and wages; you implement stimulus packages. We have seen the very positive evidence that has flowed from those stimulus packages. They have helped cushion the Australian economy, along with the bank guarantee. The third is that you do not resort to protectionist measures, which as we know from the Great Depression deepened and lengthened it.