As a result, Norway is today in a net asset position – so wealthy it recently became the target of a Twitter campaign led by comedian Stephen Colbert to get it to fund global girls' education. They say the true test of character is how people pull together in the bad times. But the true test of a country's budget and economic management is what governments do in the good times. Do they, like Norway, establish funds to pocket windfall income gains for the good of all? Or do they, like Australia, fritter the money away in tax cuts and family benefits? It appears we have our answer. This week's national accounts should not come as a surprise to anyone. Economists have been warning of the end of the mining boom for years now. Some were even so bold as to suggest Australia too should establish a sovereign wealth fund to save some of the windfall budget benefits of the China boom for future generations.

But that is not, as it turns out, how we Australians do it. While those Scandinavians pull together to fund universal welfare states, free education and generous parental leave schemes, Australians chose the path of individualism. Australians benefited greatly from the mining boom. Household incomes were boosted not only by higher wages, but also tax cuts and boosts to family payments. Of course, instead of celebrating the good times, we spent much of it whingeing about the cost of living. As Deloitte Access Economics director Chris Richardson has been at pains to point out for almost a decade now, Australian politicians took the temporary benefits of a mining boom and spent them on permanent tax cuts and handouts, opening a massive structural hole in the budget.

The Rudd government took remaining surpluses and spent them trying to buffer Australia from the global financial crisis. And it worked, for a while. Australia had a lovely crisis. Mortgage rates were slashed and families received bonus cheques in the mail. Meanwhile, authorities in China propped up their economy by building empty apartment blocks and high-speed railways to nowhere. Australia survived the GFC relatively unscathed. It is the end of the China boom that now risks bringing us unstuck. Australia now joins a group of resource-dependent, advanced economies that are now struggling, including Canada, which is in recession, New Zealand and Norway. Fortunately, we are not so much a one-trick pony as many of these countries. Australia still stands to benefit from exporting other things to China, like agriculture products and services. But Australia's budget crisis has only just begun.

Treasurer, Joe Hockey, who revelled in lambasting former Labor Treasurer Wayne Swan for never producing a surplus, now looks likely to follow his predecessor's lead. Fix the budget, they said. It'll be easy, they said. Nearly two years into government, the reality of the economic and budget task ahead is hitting home. The irony is most Australians took their tax cuts and stimulus cheques and saved them. As this week's national accounts confirm, Aussie households have gone from spending more than we earn, to saving about 8 per cent of it. If only our leaders could have shown as much discipline. The time to fix the fiscal roof is while the sun is shining.

Hockey et al now resemble a rag-tag team of tilers stuck on the roof in the pelting rain with little but some chewing gum and string to assist them. In truth, successive Australian governments – Howard, Rudd, Gillard and now Abbott – have colluded to use a temporary boom in finances to fund unsustainable tax cuts. Worse, they used it to pledge big spending on disability care and education – entirely worthy things we can't now bring ourselves to abandon, but we have no idea how to fund. And anyway, with an economy now on the ropes, cutting spending and raising the tax burden would be exactly the wrong thing to do. The price of this collective political failure is that Australian government debt on issue has hit $385 billion and is rising. That's not a problem if the money is all invested in worthy infrastructure that will grow the economy's productive capacity. But Australia is simply living beyond its means just to pay for the ordinary business of government.

The Norwegians have their fund to pay for future generations. We're leaving a legacy of public debt. It is an indictment of successive governments – Howard, Rudd, Gillard and now Abbott – that our budget is in such a parlous state. One day our coal and iron ore will run out, and we will have precious little to show for it. Twitter: @Jess_Irvine