Last Tuesday’s prime rate increase has been positioned as a disaster level cyclone by the opposition, and an inevitable but minor storm in a well-managed teacup by the Government.
Which is it?
Anyone who has been using their brain over the last months recognised there would be a rate rise, soon.
House prices have surged, supply chains are broken, energy and telco prices are ramping up, there is a not so little war going on in Europe. China is locking down millions in response to Covid outbreaks, and we, along with the rest of the developed world have been printing money like Darcy Duggan on day leave.
If ever there was a recipe for an inflationary breakout, this is it.
Unfortunately, or fortunately, depending on your point of view, we are in an election campaign characterised by ever more expansive promises to spend more in pursuit of a few votes.
Who now cares about the rhetoric that previously dominated the political agenda: Debt and deficit? Seemingly the current government has had some sort of shape-changing conversion on the road to Kooyong that makes all that former fiscal rectitude irrelevant.
Meanwhile, the opposition, while squarely blaming the government for the inflation rate is determined not to be outspent in the vote buying contest.
All this is happening while teachers in NSW strike for better pay for the vital job they are doing, Nursing home staff are as rare as non-drinkers on Anzac Day, and hospital staff are exhausted after two years of intense pressure on them while listening to politicians tell everyone not to worry, everything was under control.
There has been a wholesale replacement of fact by opinion and belief.
A fact is repeatable, its veracity can be tested, and the impact of changing input variables measured. A belief by contrast cannot be put to the test, but for some it becomes an absolute truth that is beyond dispute, and any disagreement is treated as some form of advanced blasphemy.
At some point, the piper will have to be paid, and ignoring that simple fact only makes the day of reckoning more painful.
Whichever party wins on May 21, they will inherit a generational mess of its own making. Trouble is, we, the voters, will be paying for it while politicians and by then former politicians will be running for the publicly funded sinecures provided
Header cartoon credit: the great Leunig
