The Australian government should borrow money to pay for rebuilding from flood damage instead of imposing a one-time levy on taxpayers to fund the effort, said Warwick McKibbin, a member of the Reserve Bank of Australia’s board.
“Borrowing is a far better strategy,” McKibbin, a professor at Australian National University, said today in an interview on Bloomberg Television in Canberra. “This is a classic example of where a government should borrow. We have room to run deficits in the short term. That’s what we should do.”