We need to solve this politician-induced cost of living crisis
With interest rates rising again this week, inflation driving up the cost of everything and unaffordable housing for young people, families have been under the most pressure for decades.
The frustrating thing about all of this is that it’s very little because of the war in Ukraine.
This might come as a surprise given the narrative of state and federal governments.
Much of the cause of the price spike was and is preventable and is the result of the policies of the big parties, the Greens and the new Teals.
Yes, Vladimir Putin’s evil warmongering 22,000 kilometers away had some impact. But the local government’s overreaction in spending borrowed billions on the pandemic and other largesse measures has been like pouring gasoline on a dumpster fire.
Now the Reserve Bank is trying to stifle it by raising mortgage rates.
Despite this week’s 0.5pc rise, there are signs that the RBA is not over and further mortgage stress is on the horizon.
Inflationary pressure is also heightened by rising electricity bills and oil prices.
Joe Biden carries some guilt for fueling global oil shortages leading to gas pump pains here.
He canceled the Keystone pipeline from Canada and halted oil and gas drilling on federal lands, which cruelly undermined America’s energy self-sufficiency under former President Trump.
In Australia we have banned gas fracture stimulation which has been safe and used for decades and the effect has been to slow gas production and raise prices.
Successive governments have banned oil exploration in Australia’s Great Bight, shutting down a potentially rich field before we even know what’s there.
It’s all well and good for Australia to pursue low-carbon policies, but limiting the supply of energy from coal and gas while providing decades of billions of dollars in taxpayer subsidies for renewable energy generation technologies that are not yet up to scratch. only hurt people.
These policies by the Greens, Labour, Liberals and now the Teals have brought the East Coast power grid to a third world state of reliability.
This is all the more infuriating given Australia’s competitive advantage, as a resource superpower is wasted with no environmental gain.
Our emissions are 1.3% of those of the globe and our chief scientist said that if we stopped all burning of fossil fuels and eliminated our intensive animal industries, it would achieve ‘virtually nothing’.
Meanwhile, we’re exporting record amounts of coal and iron ore, and that’s just as well because that black and red gold provides much-needed revenue to pay off our out-of-control debt and fund government services like hospitals and schools.
When it comes to housing affordability, Putin is not the one restricting the supply of land in Australia or imposing stifling red tape on new suburban and infill developments. Tax breaks such as negative debt and capital gains tax breaks as well as subsidies for first-time home buyers all conspire to further drive up the price of housing.
The fundamental drivers of Australia’s cost of living crisis are local. They are induced by politicians.
And in terms of family taxation and childcare policy, it is the Green-Labor-Liberal-Teal alliance that penalizes families who provide childcare at home by denying them equal childcare allowances of children. This political quadrilateral also conspires to deny income splitting to reduce a family’s taxable income.
So what to do?
Governments must establish the market conditions for abundant, affordable and reliable electricity. Thorough planning and costing of a renewable energy network, including storage and interconnection, must take place (it has not so far).
Wind and solar farms should be forced to add storage to their operations and we cannot afford to close more coal and gas plants until we have made the appropriate arrangements to replace them with electricity generation reliable.
State and federal governments need to free up more land and cut red tape and government burdens that impede development, driving up costs. The generalization of access to property must become an urgent political priority.
Governments must abandon their ideological bias against families wanting to have a parent at home to look after the children.
Australia’s political quadrangle has left the field when it comes to dealing with the social and economic well-being of families.
Lyle Shelton is National Director of Family first.
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