The tax and spending settings of the government are starting to wreak havoc on the economy and the news is about to get worse.

The latest key economic data – known as the national accounts – is due to be released by the Bureau of Statistics tomorrow.

The report is expected to reveal Australia is suffering from sluggish economic growth, propped up by record levels of government spending.

Australia has long been stuck in what’s called a per capita recession.

In layman’s terms, that means the average Aussie is becoming poorer and our standard of living is decreasing.

And that’s not about to change anytime soon.

Treasurer Jim Chalmers has sought to make a virtue of his government handouts – such as electricity price discounts and childcare support – as addressing the cost of living crisis Australians are enduring.

But the contradiction is that economists continue to warn that Chalmers’ spending – which is at record levels – is prolonging peoples’ pain.

It comes as the amount of tax that the government collects is falling because commodity prices have come off in recent months and fewer international students are attending our universities in the wake of the government’s crackdown.

In other words, there is less tax money to spend, but more spending is happening anyway – by using debt to pay for it!

And unfortunately, the more state and federal governments spend, the less likely interest rates come down.

It’s that simple.

Chalmers’ high spending is ‘baking in’ inflationary pressures, which prevents the Reserve Bank from lowering interest rates to counterbalance the sluggish economy.

Worst of all, we know this government spending isn’t going to stop.

With a federal election campaign just around the corner both major parties will want to tempt voters with expensive electoral bribes.

There is even a reserve contained in the budget allocating billions of dollars to do just that.

The fact the election is likely to be a closely fought contest only increases the chances of higher spending.

The next election will be the equivalent of a spending arms race between the major parties.

It will lock in unsustainable recurrent spending, which will balloon the national debt – and future generations will one day need to pay it back.

In the meantime we all need to service the interest payments on the debt.

That is becoming one of the most extensive line items in the federal budget, as debt hits the trillion dollar mark with no end in sight.

You’d think that would lead to higher taxes.

Tomorrow’s national accounts numbers will reveal just how soft economic growth in Australia really is.

The only reason we are growing at all and not going backwards is because of record government spending and high levels of immigration, despite the squeeze being placed on the university sector.

Mining profits have collapsed, down nine percent this quarter.

Company taxes are down right across the board, contributing to an expected $30billion deficit when the next budget is handed down.

Instead of growing the economic pie, as Paul Keating used to advocate, we’re just growing debt levels.

And that’s without the government legislating economic reforms that can help bring the debt back under control.

No wonder speculation is growing that the government wants to get to the polls early, before next year’s budget, which is set down for April.

Delivering bad economic news hand over fist won’t help Labor win the next election, so why would Albo wait until after the budget to head to the polls?

The better answer is he probably won’t, unless he doesn’t think he can win, of course. In which case he’ll wait as long as he can before serving himself up to unhappy voters.