Politicians Making Inflation Worse

We elect politicians to fix problems and make people’s lives better.

But increasingly our elected representatives are doing the opposite.

They’re creating new problems, exacerbating existing ones and failing to find solutions to
any of the pressing issues.

The biggest issues facing most Australian households right now – according to the surveys -
are the cost of living and rising accommodation costs.

Soaring prices for petrol, electricity and food are a major burden for many families and the
shortage of homes, a problem created by politicians, is getting worse – thereby pushing up
property prices and residential rents.

The Federal Government has taken no effective action to deal with these core problems.
There’s a lot they could do to deal with petrol prices, power prices and the shortage of
housing, but they’ve thrown up their hands and essentially told us is out of their hands.

They’re leaving it to the Reserve Bank to solve inflation by putting up interest rates – a move
which has added to inflationary pressures in many key areas, including residential rents.

And now we have analysis from the International Monetary Fund, which has concluded that
the spending boom on infrastructure by governments across Australia is one of the biggest
contributors to high inflation.

The IMF says the unusually high level of government spending on infrastructure has helped
push the nation’s economy beyond full capacity, which has forced the Reserve Bank to lift
interest rates further to tame inflation.

In effect, Australian mortgage holders are being forced to bear the consequences of higher
interest rates because government spending has over-expanded and is heating up demand that
the Reserve Bank is trying to hose down.

It’s bizarre, isn’t it? Politicians have made serious errors of judgment which have caused high
inflation and the Reserve Bank’s response is to punish the one-third of Australian households
which have mortgages.