Editorial: Rate rises and cost of living bite but Albanese does nothing

Millions of workers are being pushed into poverty by the surging cost of living, yet the Albanese government does nothing.

The Reserve Bank caused even more shock when it raised interest rates for the 12th time in June, with further rate rises still expected. It seems determined to drive the economy into recession.

Workers will pay the price as unemployment rises and mortgages and rents skyrocket.

Home loan payments have more than doubled, rising an extra $1200 a month on average. Almost a million people are facing a jump in repayments as fixed-rate terms expire.

Household spending is plummeting following the cost of living squeeze. Commonwealth Bank economists expect a per capita recession later this year, with a 50:50 chance of an outright recession.

Workers on Award wages will get a 5.75 per cent pay rise this year, following the Fair Work Commission’s decision. Most workers are getting far less—with a real wage cut of 3.1 per cent over the last year on average. Real wages have dropped back to the levels of 2009.

But not everyone is suffering. Big companies and the rich are still rolling in cash. Qantas is expecting a record profit of $2.48 billion and the big banks raked in a combined $16 billion over the last six months.

CEOs pocketed 15 per cent pay rises. The average pay of bosses at the top 200 companies is now $1.1 million. Profits have been driving inflation, with OECD research in June showing that profits took most of the benefits of higher prices as inflation was accelerating in early 2022.

As a result the profit share of the economy has hit a record high and workers’ wage share is at its lowest in history.

The Albanese government could tax the rich to subsidise power bills, which are set to rise another 20 to 30 per cent. Queensland’s Labor government has announced a $550 subsidy for every household. But Albanese has done nothing.

The money is there. Labor managed to find an extra $2 billion for social housing in the face of pressure from The Greens after the stand-off in the Senate over its hopeless housing fund.

There are billions more going on the Stage Three tax cuts and nuclear submarines—as well as far more that could be raised through taxing obscene corporate profits.

AUKUS opposition

Opposition to Albanese’s appalling $368 billion spending on nuclear submarines is growing among unions and Labor Party members.

The Queensland Labor state conference voted down a motion in support of the nuclear subs 229 votes to 140 in early June.

A motion opposing the nuclear subs also went to the Victorian state Labor conference, before it was pulled and referred to the national conference in August in a factional deal.

Unions including the AMWU and ETU oppose the plan, continuing a long history of labour movement opposition to the nuclear industry.

Albanese’s ridiculous argument that the nuclear subs are a “jobs bonanza” has been blown out of the water. It was already clear that $368 billion could deliver far more jobs elsewhere, say in building public housing or renewable energy. Albanese has claimed the project would deliver 20,000 jobs—at a cost of over $600,000 per job a year.

But the Defence Department has now confirmed that five of the eight nuclear subs could be bought directly from the US. The first three will definitely be US-made Virginia submarines, with an option to purchase four or five from the US if local construction falters.

Every union and Labor Party branch should back a motion against the nuclear subs, and back the protests planned outside Labor’s national conference in August.

The court ruling that Ben Roberts-Smith committed war crimes in Afghanistan shows the real face of Australian militarism. Australia is an imperialist power that works in lockstep with the US to dominate the world.

We need to oppose the surge in military spending that’s feeding the power struggle between the US and China in the Asia-Pacific and increasing the chance of a catastrophic war.

A union campaign for pay rises is also desperately needed. Unions that fight win more pay. Even though pay increases are still behind inflation, Sydney University won 4.6 per cent this year, while Onelink workers in Sydney won 7 per cent this year after five strike days.

NSW public sector workers including nurses and teachers have been offered 4 per cent by the new state Labor government after strikes last year—but should keep fighting for more.

The NSW Health Services Union has rejected the offer saying it “falls short” of what’s needed, holding stop-work meetings in hospitals.

The Albanese government is refusing to act on the crises around housing, the cost of living or climate action, protecting the wealth and profits of corporations and the rich. It is going to take a fightback through grassroots organising, protests and strikes to win the real action needed.


Solidarity meetings

Latest articles

Read more

Albanese aids Israel and smears protests as horror unfolds in Rafah

Israel has begun its long-threatened assault on Rafah. Hundreds have already been killed,  thousands more will likely die as Israel’s savagery continues.

Labor’s cost of living band-aids in budget leave real problems ignored

Labor’s budget is about making it look like the government is acting on the cost of living, in the hope of dampening the anger workers feel about it in time for an election in the next year.

Voice to Parliament another example of Albanese’s aversion to serious change

Support for the referendum on the Voice to Parliament is still plummeting.