Extract from The Guardian
The “cost-of-living crisis” has ushered in a feverish cycle of retail politics, where our elected representatives strive to prove both their empathy and utility by promising to end the hip pocket squeeze being felt by many Australians.
The Albanese government has made history winning a cost-of-living byelection; New South Wales has changed power in a contest where the hip pocket nerve was vigorously massaged; the upcoming federal budget will inevitably be framed around the issue as well.
But there is a wilful blindness at the core of this crisis that risks diminishing the challenges people face by reducing them to a crude consumer price tag.
The “cost-of-living crisis” has the vibe of a construct cooked up in one of those libertarian language labs that have shifted “global warming” to the more benign “climate change”, “public funding” to the fiscally medicinal “tax relief” and “privatisation” to “asset recycling”.
“Cost of living” implies an inevitability to our current situation, as if this inflationary cycle is just a natural consequence of our worldly existence, part of the rhythm of our economic life that we need to accept.
But there is nothing natural about the pain that households are currently feeling. It is the direct consequence of “economically rational” decisions (another triumph of rightwing framing) made by governments over many years.
There is nothing natural about a housing system that privileges those who have accumulated capital over those who have not; nothing natural about the retail markets that dominate education, nothing natural about our unhealthy reliance on fossil fuels.
As this week’s Guardian Essential poll illustrates, these are decisions that are now undermining the economic security of many Australian households
If cost of living is the question, the answer is a resounding “ouch”. One quarter of the population are doing it tough, another 40% are starting to feel the heat, leaving just a third in the comfort of the economic banana chair.
This speaks to a second problem with the “cost-of-living” frame. It vests the challenge to find the money to pay the bills and mortgage in the individual, rather than seeing these as the inevitable consequence of turning essential services into private markets and transforming citizens into customers.
As individual consumers it’s on us to navigate the system, with the government’s role confined to improving the flow of consumer information. Remember the Rudd government’s impotent response to post-GFC rising prices with a string of price comparison websites?
Finally, thinking of the current problem as a “crisis” makes the moment seem transitory, more like an economic storm or bushfire to be weathered while absolving government of longer-term accountability for systemic failures.
But a separate question suggests most people have not read the free market memo and expect the government to intervene with more than crisis payments and emergency accommodation.
People, especially the young who are most affected by the impacts of inflation, believe government can – or more appositely could – make a difference if they chose to. It’s what politicians do with that expectation that is more revealing.
Ironically, for the conservative political parties that have always governed in the name of “free markets”, blaming the new government for living costs requires a suspension of disbelief that not even the Murdoch echo chamber can sustain.
This was borne out in the Coalition’s abject failure in the Aston byelection over the weekend, where the federal Coalition discovered that simply shouting “cost of living” is not enough to convince people you have a plan.
Meanwhile in NSW, Labor’s successful prosecution of the “cost-of-living crisis”, a key issue in winning minority government, was more a series of Band-Aids placed on existing policy wounds than transformative change.
NSW Labor promised to lift the 2.5% public sector wages cap designed to peg pay claims to inflation but now delivering declining living standards to nurses, teachers and many other tens of thousands who work directly for the government.
It also pledged to end the Coalition’s privatisation fetish and specifically vowed to keep Sydney Water, one of the few assets that hadn’t been flogged off already, in public hands.
Most gallingly, it promised to redirect significant taxpayer dollars to offset the exorbitant tolls multinational corporations are charging people to get around a city too reliant on private roads. Cost of living, indeed.
A final table shows there is an appetite for government to take the discussion beyond the sticker and open a more honest discussion on the very architecture of our economy.
These figures show the depth of public appetite for government intervention into the markets of essential services, not just at the point of sale, but at the source.
Ideas that have been off the table for the best part of four decades including centrally mandated price caps on energy prices enjoy overwhelming public support. Tax cuts are also as popular as ever, highlighting the challenges in reversing even the regressive stage-three handouts to the wealthy.
But it is support for systemic change that also stands out, starting with the shambolic childcare market that has placed unnecessary economic stress on young families while placing unfair barriers on women returning to paid employment.
Turning this failing market into a coherent, universal early learning system will ease price pressure, increase immediate productivity and invest in kids for the long term.
Speaking of working, the workplace minister, Tony Burke, has recognised one of the huge drivers of cost-of-living pressure is at the input end, a bargaining system designed to minimise wages for labour and maximise profits to capital.
Even before our current “crisis”, the Reserve Bank was warning of the impact of artificially low wages. Now it is these same Paye wage-earners who are facing the brunt of rising prices who are being most squeezed.
There is strong support in our Guardian Essential poll for Burke’s endorsement of a higher minimum wage; but this is not the only work on his agenda to get wages moving, with “same jobs, same pay” laws to increase pay for labour hours and contractors.
Rather than being in a “cost-of-living crisis”, maybe we are actually in an “inequality crisis” or a “markets charging us too much (while continuing to deliver massive profits) crisis”.
Or maybe we are entering a “finally taking responsibility for the way our nation functions” moment. Less “cost of living”, more “choice of how we live together”.
The “cost-of-living crisis” narrative served Labor well in opposition, allowing it to shift the abstract economic management contest to the kitchen table.
Moving beyond it in power could give it its best chance to create the momentum and urgency to deliver on its broader policy agenda and render the Coalition, which will instinctively oppose anything it does, even more irrelevant.
Peter Lewis is an executive director of Essential, a progressive strategic communications and research company
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