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Rudd: Joyce ‘irresponsible’ for comments

Prime Minister Kevin Rudd this morning accused Opposition finance spokesman Barnaby Joyce of irresponsibility following suggestions by Joyce that the US may default on its debt.

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Yesterday, Joyce said Australia must prepare for the fallout that may occur were the US to default on its debt.

“What will be the effect then on the demand for Australian resources?” Joyce asked.

“Obviously that would go through the floor, and you know, how would Australia go forward in a position where the dynamics of the global economy are all changed?”

Joyce also wants a ban on Chinese state investment in Australia.

“There has to be consideration as to what extent you want a state-owned enterprise, China or otherwise – a state-owned enterprise will be the owner of your mineral wealth, our nation of Australia’s sovereign wealth in the ground,” he said.

But Mr Rudd says Joyce is making up policy as he goes along. “That’s shooting from the lip, making it up on the run, I think being very, very irresponsible about basic Australian interests.”

“For someone, as the alternative finance minister of Australia, to run around the place saying America could default, Australian state governments could default, that’s not responsible economic policy,” he said.

Joyce aims for big four

Yesterday, Joyce also floated the prospect of introducing divestiture laws aimed at improving competition in the banking sector.

Senator Joyce said banks were riding rough shod over consumers due to reduced competition in the sector and that the federal government was doing nothing to stop it.

“Westpac under the cover of darkness have jacked up rates way beyond where the RBA (Reserve Bank of Australia) has done it and have done because they can,” he told Sky News.

The comments follow a decision by Westpac to hike its mortgage rates by 0.45 of a percentage point, almost twice the

25-basis-point rise in the official rate handed down by the Reserve Bank last week.

“The government stood by and watched St George and Westpac amalgamate, BankWest and CBA amalgamate,” Senator Joyce said.

“The government has stood by and watched the centralisation in the banking market and now we’re seeing the fruits of that.”

Earlier this year, Westpac bought St George while the Commonwealth Bank acquired BankWest.

Senator Joyce said the centralisation of the banking sector had put the banks in a very strong position where they could basically do what they wanted in terms of interest rates.

Joyce: Give government the power to break up merged banks

The opposition finance spokesman said divestiture laws could be introduced that would allow the government to break up the merged banks if they abused their market position.

“You don’t even have to break them apart. You have to suggest to them that those powers could be in place to do that if they are not more diligent in how they respect the Australian community,” he said.

“Sometimes these powers are like a Sword of Damocles and they keep people in check because they know the government has the capacity to influence how they do business if they get out of control.”

The federal government stood back and watched the big banks gain market share and as a result consumers were being exploited with no checks or balances.

“We would certainly look at competition in the banking sector and we would certainly be far more diligent about what the effects would be to the marketplace prior to these mergers going through,” he said.