Nick McKim (Tasmania, Australian Greens) Share this | Hansard source

We are witnessing something extraordinary and devastating unfolding in this country: the lives of the poorest Australians, those who can least afford to be made worse off, are being degraded in the relentless and dogmatic pursuit of a self-defeating economic goal. Renters and mortgage holders are being smashed by a Reserve Bank stuck in the past and in denial of reality. Tomorrow will just be the latest chapter of this unfolding ruination of the poorest Australians when the RBA does what it shouldn't do and lifts interest rates for the 10th consecutive time. Meanwhile, the government is more interested in ashen-faced commentary rather than doing what it was elected to do, which is to actually help people. We find ourselves today, and we will find ourselves tomorrow, at the dead end of neoliberal economics. And at that dead end lies the inherent flaw in one of the hallmarks of this corrupt ideology: so-called independent central banking.

Independent central banking is fundamentally undemocratic. The justification for one of the most important economic tools not being in the hands of elected government is that monetary policy is too important to be left to politics. We are told that interest rate decisions are best left to those who really understand the economy, and that inflation is always and everywhere a function of excessive demand that the RBA alone should be left to get under control. It's on this reductive logic that the RBA's nine consecutive rate rises have been based and have gone unchallenged by the government. And it's on this reductive logic that tomorrow's 10th interest rate rise will again be based. But the logic is flawed. How do we know it's flawed? Well, because the RBA have told us so.

Last month, the RBA said that between half and three-quarters of the increase in inflation is a result of supply shocks. And the chair of the board of the RBA, Mr Lowe, said, 'There is very little that monetary policy can do to offset supply shocks.' He said, 'Our models are not well suited for supply shocks.' So, there it is: our glorious, technocratic, wise-above-all-others, independent central bank, responding to a problem it can't understand with a solution that doesn't suit. That's the great travesty happening before our eyes.

We know that interest rates are not the right tool to deal with the current inflation spike, but we are stuck in this bizarre Pavlovian state where the RBA raises interest rates to squash a non-existent price-wage spiral and the government goes through its 'nothing we can do about it' routine, and the poorest Australians—the renters and the mortgage holders of this country, who did nothing to create the problem of spiking inflation—are paying the price. And we're supposed to believe that this is the best we can do, while the wealthiest in this country continue to make off like bandits. Well, it's not good enough.

I say to Labor: people's lives are being destroyed, so wake up and do something about it. Tax corporate super profits, tax the wealthy, freeze rents, make child care free, put dental and mental health into Medicare, and raise income supports. These are meaningful actions that Labor could do if they would just take their heads out of their centrist fundaments and look to the light on the hill. Please, do something. Don't just sit there and pretend you can't.