28 February 2023

Tim Dunlop: “As many economists are currently noting, the Reserve’s response to inflation is predicated on increasing interest rates to curb wages, even though wage growth is not causing inflation.” (He cites this recent paper by the Australia Institute.) “This is the insidiousness of neoliberalism writ large: it institutionalises and normalises policy that, in a truly democratic system would not be allowed to stand. It gives cover to the various elites who benefit from its presumptions and removes from citizens the right to challenge policies that lead to deeply undemocratic — unequal — outcomes. … Every time you hear the Treasurer, Jim Chalmers, invoke the title ‘the independent Reserve Bank’ remember that what he is really doing is underlining the undemocratic nature of that institution, hiding behind its alleged independence to normalise policy that is harmful to working people. ‘Independent’ in this context is just another word for anti-democratic. It is a way of removing control of the economy from social-political forums like the parliament that, in a democracy, are meant to be about the pursuit of equality amongst citizens, and instead creating the exact opposite: a more unequal society where wealth is channelled relentlessly upward.”