Josh Frydenberg economic downturn stimulus treasury
(Image: AAP/Lukas Coch)

In December 2012, treasurer Wayne Swan faced a choice: tax revenues had continued to underperform Treasury's forecasts and the global economy was deteriorating. He'd already cut $10 billion from spending in MYEFO a few weeks before to preserve a promised budget surplus, which he and prime minister Julia Gillard had committed to scores of times.

Now he'd have to cut spending again if he was to cover further shortfalls in tax revenue. But with unemployment at 5.3% and rising, spending cuts risked weakening the economy at a time when it was already struggling. So he could either save his pride and spare the government political embarrassment and maintain the surplus, or cop the humiliation of breaking a promise and prop up the economy.