Buck-passing Treasurer Jim Chalmers has everyone in a miserable state

Treasurer Jim Chalmers and, inset, RBA governor Michele Bullock.

Addressing the National Press Club in October 2022 for the first time since he became Treasurer, Jim Chalmers was emphatic about the dangers of inflation. It was “public enemy number one,” and “the dragon we need to slay,” he said.

“An indiscriminate spraying of cash would have made our inflation challenge more profound,” he warned, stressing the need for fiscal restraint. To do otherwise would not only prolong excessive inflation but also cause “higher prices and higher interest rates” that would hurt Australians.

“And I think most people get that,” he said.

They do, Treasurer. You would be surprised though who, of all people, does not get it. But more on that later.

By January 2023, and having been in office eight months, one week, and two days, Chalmers saw within himself the emergence of an economic polymath. In a 6000-word essay published by The Monthly, he outlined his great plan to force an economic evolution for the betterment of the masses. By drawing on his magisterial wisdom and the dosh of others, he would transform “neoliberalism” and deliver us “social capitalism” built on “fairness” and a “values-based” economy.

Contrary to Chalmers’ expectations, his paper did not attract universal admiration. The general consensus of commentators was, firstly, his essay was a hotchpotch of undergraduate scribblings, and secondly, that the Treasurer had tickets on himself. But true to his word, he has since transformed the economy, although slightly differently from what his philosophising envisaged.

As for his posturing about an economy that mandates fairness, you could say that Chalmers has made a start to fulfilling his egalitarian vision. We are well on the way to becoming a society in which nearly everyone is equally miserable.

A few examples will suffice. GDP rose by a pitiful 0.2 per cent in the June quarter. The pandemic period aside, this is the Australian economy’s worst performance since the end of the early 1990s’ recession. The Albanese government has realised negative GDP per capita growth for the sixth successive quarter.

The number of filings for personal insolvencies in July was up by 8.9 per cent from June. Real per capita retail spending has fallen by 6.3 per cent since June 2022. And as The Fin Review reported last month, Australian households suffered the biggest drop in disposable incomes across the OECD during the past two years.

Having failed to remake capitalism, Chalmers has now decided he will change the laws of economics. He claims there is “not any evidence” that the government’s massive splurge is a predominant driver of inflation.

This is delusional. Taxpayers are funding nearly two-thirds of the jobs created under the Albanese government. Public spending now stands at 27.6 per cent of GDP – a post-war record, while Commonwealth social benefits increased by 15.8 per cent last financial year. Yet productivity continues to slide, falling 0.8 per cent in the June quarter.

Chalmers and Bullock in November 2023. Picture: Aaron Francis

Like his leader Anthony Albanese, Chalmers has a habit of denying the obvious. That is not the only similarity the men share. Both have remarkably flexible principles. Less than two years ago the formerly serene Treasurer was giving us the thoughts of Chairman Chalmers. Yet now he resembles a frazzled Latin American finance minister, with a fiscal policy to match.

As for his bold remarks about slaying the inflation dragon, that is rich. In this pantomime, Chalmers plays ‘Brave’ Sir Robin from Monty Python and the Holy Grail, the medieval knight who does a runner when confronted by the monster, only for his minstrels to compose a ballad hailing his cowardice. (Slightly amended lyrics): When inflation reared its ugly head / Jim bravely turned his tail and fled.

But even worse than Chalmers’ pusillanimous abrogation is his blaming RBA governor Michele Bullock for the current situation, claiming rate hikes were “smashing the economy”. Compounding this weasel act was his insistence later he was “not taking a shot at anyone”.

“The Reserve Bank governor has her job to do when it comes to monetary policy; I have my job to do and my responsibilities,” he told reporters.

No-one disputes that. Unfortunately, however, the role of Treasurer and Chalmers’ understanding of what it entails are vastly different. He prioritises self-ambition and ensuring another three years of Labor government over reducing inflation. And if getting the RBA to reduce the cash rate before the next election means browbeating Bullock, so be it.

To her credit, Bullock is not budging. Not that she was seeking vindication, but it came when ALP national president, former treasurer, and four surpluses charlatan Wayne Swan accused the RBA of “putting economic dogma over rational economic decision making”.

Memo to Swanny: it is a truism that political careerists, spivs, and hacks are past masters at using the public teat to accumulate wealth for themselves, but they are utterly clueless when it comes to giving informed advice on economic growth. Give it a rest.

Swan, you will remember, also lambasted Productivity Commission chair Danielle Wood earlier this year for voicing concerns about the Albanese government’s Future Made in Australia plan, claiming she was “completely out of touch”.

As Janet Albrechtsen noted in this masthead yesterday, both Bullock and Wood deserve respect for their objectivity and apoliticism. The occasional political stoush is an inevitable aspect of their respective roles, but both have proved their resilience.

But imagine the reaction of the ABC and the rest of the so-called progressive media if it were a Liberal treasurer undermining Bullock, or if an obnoxious Coalition elder tried to put Wood in her place. Loud accusations of misogyny and mansplaining would follow within minutes. You could guarantee that on the following Monday evening, Q+A would field an all-female panel to discuss why the Coalition sees strong women as a threat. But as expected, the sisterhood is mute when a Labor figure is responsible.

In defence of Chalmers though, I take issue with those who claim he is the worst treasurer since Jim Cairns. Obviously they forget that Energy Minister Chris Bowen held the treasury portfolio, albeit for a mercifully brief period.