The speed with which Australia’s fundamental operational structures are being changed is quite breathtaking.
At the beginning of February, the Federal Treasurer, Jim Chalmers, released a ‘thought’ article where he announced “…the beginnings of a new economic model” by creating “…a new values-based capitalism for Australia”. This embodies a surprisingly radical intent, even given the tradition of the labour movement’s ambitions over the last 50 years.
On my thesis, ‘The New Australian Socialist Experiment’ (also released in February), I saw Chalmers’ declaration as part that emerging experiment. What I hadn’t expected was the rapid rate at which this new agenda unfolded, became apparent and ignited a vigorous debate.
Gary Banks was the head of the Productivity Commission from 1998 to 2013. The Productivity Commission is the major government-funded ‘think tank’ that looks at, and reports on, how to make Australia efficient and productive. Normally any criticism by such government bodies directed at government (even by retired heads) is cautious, using toned-down bureaucratic language. But this week Gary Banks came out swinging.
In a damning assessment of the current policy direction Banks referred to “…policies that have damaged our economy’s ability to cope with change, to be competitive and support economic growth.” He refers to “monumental bungling”, policies that are “…contrived to maximise the cost…” and “…we [Australia] have been busily eliminating our competitive advantage…”
Gary Banks’ criticism is directed at all governments, not just the current federal government. What is significant is not simply his criticism of specific policies, but the unexpected tone of his criticism. He is flagging an Australian structural, self-created, economic downslide.
Banks’ blunt warning comes just as many retirees are reeling in shock at unexpected significant changes to superannuation tax rates. While the proposed tax regime only appears to affect ‘rich’ people, those changes also signal that using superannuation for retirement is now much more risky. Is this the beginning of the end for superannuation?
To us (SEA), it’s not just what’s already happened that’s caught our attention, but what seems to be pending. There are tea leaves to be read!
- There is broad media reporting of a rental crisis. But emerging policy seems to be pushing housing rental supply in a negative direction. One much-touted ‘solution’ is the imposition of rental price controls and rent freezes.
- Influential, wealthy unions are supporting and calling for price controls—not only on energy but, seemingly, more broadly as well.
- State workers’ compensation schemes are in financial crisis, unable to fund their obligations.
Our experience is that when this sort of media coverage starts happening it’s usually followed by new regulations to ‘solve’ such problems.
And we know that the policy knives are out to harm self-employed people. We reported in February on just one agenda item designed to kill off independent truck drivers.
Over the next few weeks we’ll try and put together analysis of these issues and more. Things are certainly moving at a rapid rate!