THINKTANK AGREES WITH AUSTRALIAN GOV'T BOND MARKET MOVE.

CANBERRA, Dec 2 Asia Pulse - Treasurer Peter Costello's push to withdraw the government from the bond market has received support from a Newcastle University thinktank.

But the Centre of Full Employment and Equity (CofFEE) also disagreed with Mr Costello's pursuit of Budget surpluses, saying this has led to unsustainable levels of private sector debt and destroyed public wealth.

In a submission to Treasury's review of government involvement in debt markets, CofFEE Director and macroeconomics specialist Bill Mitchell said government bonds had no public interest role as the private sector argued.

"The claim that the government is serving the public interest by issuing debt is nonsense," Professor Mitchell said.

"It is really nothing more than special pleading by an industry sector for public assistance."

Professor Mitchell said ...