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Today is D-Day, again. This afternoon the Reserve Bank will announce another rate hike, borrowers will absorb the shock and work out how much they'll have to trim from their household budgets. The daily $5 flat white on the way to work will be under threat. The canny budgeters will work out forgoing this one discretionary spend will save them about $1300 a year. They might even consider investing in a coffee machine for home. The crema won't be as rich, the milk not as frothy but the savings might just get them over that hardship.
The unfortunate folk who bought at the top of the property market last year and didn't fix their rates will likely lose sleep. Their homes are declining in value at the fastest rate since the global financial crisis. They'll be paying more for something worth less. It's unsettling but it's not the end of the world. The caveat that's often lost in the noise is that these steep declines in value come on the back of even steeper increases during the pandemic. The property market was due for a correction, which interest rate rises have hastened. Over time, value will be restored.
Shadow treasurer Angus Taylor, who raised interest rates in question time yesterday, was quickly slapped down by the Prime Minister, who reminded the Member for Hume that the Reserve Bank foreshadowed a string of rate hikes before the election. Any politician who tries to capitalise on inflation and the RBA's painful remedies for it is riding into a dry gulch. It's more profitable to focus on immediate cost-of-living fixes, of which there seem to be very few. Statements about making childcare more affordable are soothing but do not address the short-term pressures households are facing. Nor do energy policies set to transition us from fossil fuels to renewable energy. They're perfectly fine as long-term solutions but aren't going to deliver relief any time soon. Cheaper medicines are welcome too, if you have scripts that need filling. For young workers in good physical health but financial ruin, they mean very little. Next month, the excise cut on fuel will be removed, adding to the burden on households.
A strong democracy requires an effective opposition - one that asks the questions ordinary Australians are asking. What can the government do to ease the cost of living, not next year but next month? What can be done to ensure electricity prices come down, not next year but next month? What can be done to ensure those people who have jobs but can't afford to rent homes are looked after now, not next year or the year after that?
Resources Minister Madeline King showed yesterday the sort of bottle the public wants when she fired a shot across the bows of the companies sending our gas offshore to maximise profits at our expense. Guarantee domestic supplies, she warned, or face unprecedented export controls.
Again, the warning addresses a problem foreshadowed for next year, but at least it sends a strong message that the government can and will act.
As we all know, it's action we need when our budgets are being hammered today. As The King sang all those years ago:
A little less conversation, a little more action, please
All this aggravation ain't satisfactioning me...
HAVE YOUR SAY: Is the government doing enough to ease cost-of-living pressures right now? How are you feeling the pinch? Are you likely to drive less come September when the fuel excise cut is reversed? Is the opposition asking the right questions? Email us: echidna@theechidna.com.au
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IN CASE YOU MISSED IT:
- On the day the former prime minister returned to work and sat up the back, the new PM Anthony Albanese attempted to play down recent polling that showed the government was off to a strong start in office. In the first Newspoll published since the election, the Prime Minister's voter satisfaction rating is at 61 per cent. Mr Albanese said those polling numbers would not stick around forever.
- A Voice to Parliament would bring both practical and symbolic outcomes, the Indigenous Australians Minister says. As Prime Minister Anthony Albanese revealed at the Garma Festival the possible question that could be asked in a referendum, Linda Burney said there was an "overwhelming" sense of excitement in the Indigenous community for the Voice.
- One of the country's largest unions has called on employers to solve skill shortages by employing migrant workers, provided that Australians be trained to help fill similar roles. The resolution was passed by the Australian Workers' Union national conference in Sydney.
THEY SAID IT: "Great thoughts speak only to the thoughtful mind, but great actions speak to all mankind." -Theodore Roosevelt
YOU SAID IT: We asked about the old skills of searching out the best deal and whether some companies were using inflation as an excuse to raise prices. "I have no doubt that vendors and service providers are using the opportunity to price gouge wherever possible," said Bob. "Only by shopping around will we get the best deal. Have been doing it for years, Vendors and service providers generally have no loyalty to their customers, so the reverse should also apply. Do your homework, and get the best deal possible."
Elaine had some tips: "Shopping around is great - and it includes looking out for meat that is reduced because it's coming up for its use by date. There's nothing wrong with it, and it can sit happily in my freezer until I need it. My late husband used to say that I didn't go shopping, I went scavenging!! However, I try never to buy home brands in my search for a bargain. I think every time we buy home brands, we line the pockets of the big supermarket operators, and do harm to the smaller guys."