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On this episode of Dollars & Sense, Greg and Elinor discuss the latest GDP growth figures, how rate increases have damaged the economy and what might come next.

Greg Jericho is Chief Economist at the Australia Institute and the Centre for Future Work and popular columnist of Grogonomics with Guardian Australia. Each week on Dollars & Sense, Greg dives into the latest economic figures to explain what they can tell us about what’s happening in the economy, how it will impact you and where things are headed.

Host: Greg Jericho, Chief Economist, the Australia Institute and Centre for Future Work // @GrogsGamut

Host: Elinor Johnston-Leek, Senior Content Producer, the Australia Institute // @ElinorJ_L

Show notes:

‘Now the Australian economy is on its knees, will the RBA finally start cutting interest rates?’ by Greg Jericho, Guardian Australia (September 2024)

This article was originally published on Public Square: A CNU Journal. It is shared here with permission. All images were provided by the author.

Plans to import LNG to Australia reveal the extraordinary failure of consecutive Australian governments to stand up to multinational gas corporations, the Australia Institute has said.

Key Points:

• Australia is one of the biggest exporters of gas in the world, alongside Qatar.
• Around 80% of Australia’s gas is exported as liquefied natural gas (LNG).
• Over half (56%) of gas exported from Australia attracts zero royalty payments, effectively giving a public resource to multinational corporations for free.
• Across the country, gas and oil extraction employs just 21,200 workers — less than half of one percent (0.15%) of the 14 million people employed in Australia

“This is pure farce,” said Rod Campbell, Research Director at the Australia Institute.

“We produce, burn and export a staggering amount of gas in this country. The gas industry itself is the biggest user of gas in Australia due to the gas it burns to process LNG exports. To suggest there is a shortage is absurd.

“The fact of the matter is that we have allowed multinational gas companies to take us for a ride by giving away our resources tax free and locking us into unsustainable export contracts.

“When facing a genuine resource shortage, the usual first step is to reduce usage, but that is far from what’s happening here.

“Heavily subsidised multinational corporations have been driving up the cost of gas in Australia by forcing us to bid against the international market for our own resources.

A significant proportion of young Australians say attending live music is important to them, but rising costs are a major barrier to young peoples’ attendance at live music, a first-of-its-kind national survey conducted by The Australia Institute and commissioned by The Push has found.

As the live music industry in Australia continues to struggle financially, the survey found there is strong support among young Australians for policies that would both support the sector and encourage more young people to engage with live music events.

The Australia Institute, commissioned by The Push, surveyed 1,009 Australians between the age of 16 and 25 between 9 and 15 August 2024. The survey has a margin of error of plus or minus 3%.

Jaison R. Abel, Richard Deitz, Natalia Emanuel, and Benjamin Hyman

Marco Del Negro

GDP growth figures released today show the economy almost grinding to a halt. The economy grew by only 0.2% for the quarter and just 1% over the last year. The release of these GDP figures shows that the Reserve Bank is wrong when it says, “the economy is running a bit hot” and it is time to start cutting interest rates.

The only reason the economy has seen any growth is because of the contribution of government spending. Without this contribution the economy would have shrunk by 0.2% this quarter. Worst still, without the government’s contribution the economy wouldn’t have grown at all over the last year.

This highlights just how weak the private sector is right now. Household spending is down. Business investment is down. The private sector has been smashed by the rapid rise in interest rates, demand has dried up and production is grinding to a halt.

The current economic conditions highlight how close the Australian economy is to recession and how damaging high interest rates have been to the economy. With inflation falling in Australia and around the world it is time for the Reserve Bank to follow other central banks and cut interest rates.

The post Public spending keeps the economy going as the private sector is hit by rate rises appeared first on The Australia Institute.

On this episode of Follow the Money, Ebony Bennett discusses the latest in federal politics with Professor Mark Kenny, former Chief Political Correspondent for The Sydney Morning Herald, The Age and The Canberra Times.

This discussion was recorded on Tuesday 3 September 2024 and things may have changed since recording.

Guest: Mark Kenny, Director, ANU Australian Studies Institute // @markgkenny

Host: Ebony Bennett, the Australia Institute // @ebony_bennett

Show notes:

‘The PM can ill-afford bad weeks as narratives harden’ by Mark Kenny, The Canberra Times (September 2024)

Public spending keeps the economy going as the private sector is hit by rate rises by Matt Grudnoff, The Australia Institute (September 2024)

Theme music: Pulse and Thrum; additional music by Blue Dot Sessions

Today’s national account figures show that GDP per capita fell by 0.4% during the June quarter. This is the 6th consecutive quarter of negative GDP per capita growth, showing that Australia is in a per capita recession amid an ongoing inequality crisis.

Key Points:

• GDP per capita growth of –0.4% represents the 6th consecutive quarter of negative per capita growth in Australia while total GDP growth of 0.2% is historically weak.
• Household consumption fell by 0.2%, the weakest growth rate since the COVID-19 lockdowns in the September quarter of 2021.
• Government expenditure contributed 0.3% to GDP growth.
• Interest rates are a blunt instrument that are causing normal Australians significant financial pain while the tax system is turbocharging wealth inequality.

“Today’s figures show that Australia’s economy has gone backwards for a record six consecutive quarters once you take into account population growth,” said Greg Jericho, Chief Economist at The Australia Institute.

“They confirm that households have been smashed by high interest rates despite our research showing that inflation has been mostly driven by company profits and supply-side factors. Fortunately, government spending has helped stop the economy from shrinking.

“Today’s figures highlight again how necessary the change to the Stage 3 tax cuts were, which will deliver some much-needed relief to low- and middle-income households rather than overwhelmingly benefit the rich.

Marco Del Negro 

Repeat delays are testament to how fiendishly difficult it is to get changes to electoral law right. The most recent delay has been attributed to constitutional concerns: how to design laws that limit political finance without violating freedom of political expression, which is protected by the constitution.

The High Court has reined in legislative overreach, and may get another chance to do so: last month former state independent candidates wrote to Premier Jacinta Allan arguing the carveout in Victoria’s political donation laws for the major parties’ funding vehicles is unconstitutional. Victoria introduced strict donations caps ahead of the last election. There were three independent MPs in the state’s lower house. After the election, none remained.

Only in politics does the winning team get to change the rules of the game. The risk is that MPs may vote to skew the electoral system to their own benefit, at the expense of a level playing field.
The Albanese government has given some clues of its plans, including a cap on donations, and a cap on spending of somewhat less than $1 million per candidate. One million dollars sounds like an eyewatering sum, but putting up a viable challenge to a sitting MP does not come cheap. The Australia Institute calculates each MP enjoys almost $3 million in incumbency advantages, plus non-financial benefits.

Launch of Captured: How neoliberalism transformed the Australian state

Speakers: Phillip Toner and Michael Rafferty

Thursday 5 September 2024, 1:30-2:30 pm

Room 341, Social Sciences Building, University of Sydney

Please join Phil Toner, Mike Rafferty and contributors for a seminar launching the recently released edited book Captured: How neoliberalism transformed the Australian state (Sydney University Press)

Four decades ago, faced with a series of economic, political and social crises, business and government leaders in Australia and many other nations were convinced by a well organised ideological insurgency of the need for what at first was presented as a series of technical changes in economic policy. However, neoliberalism quickly became a revolutionary agenda for re-ordering the social democratic state.

Captured: How neoliberalism transformed the Australian state directs attention to the central role of state power not just to remake markets, but also to remake a broad swathe of political life, social policy and citizenship.

Republicans have tried to pin the Vice-President as ‘Comrade Kamala’, but are her economic policies all that radical? On this special After America and Dollars & Sense crossover episode, Dr Emma Shortis and Dr Greg Jericho discuss Harris’ economic agenda.

This discussion was recorded on Friday 30 August 2024 and things may have changed since recording.

Register for our webinar with Nick Bryant on Thursday 12 September via the Australia Institute website.

Guest: Greg Jericho, Chief Economist, the Australia Institute // @GrogsGamut

Host: Emma Shortis, Senior Research for International & Security Affairs, the Australia Institute // @EmmaShortis

Show notes:

Dollars & Sense, the Australia Institute

Theme music: Blue Dot Sessions

To mark PPE@10 this feature starts a series of posts to celebrate ten years of Progress in Political Economy (PPE) as a blog that has addressed the worldliness of critical political economy issues since 2014. 

Last month, BlackRock, the world’s largest asset manager, made headlines as its support for shareholder proposals on environmental, social and governance (ESG) issues tanked at 4%, down from a peak of 47% in 2021.

This looks like an extraordinary pivot because in 2020 BlackRock became infamous as a posterchild for ESG investing. In his open letters to investors and companies that year, BlackRock CEO Larry Fink declared a ‘fundamental reshaping of finance’ whereby long term company profits would be dependent on ‘embracing purpose and considering the needs of a broad range of stakeholders’. He claimed this would involve putting sustainability at the heart of BlackRock’s investment strategy and integrating ESG factors into its investment decision making.

Peter Dutton and Donald Trump have a knack for political division. There’s no doubt that stoking fear and the politics of division can be brutally effective, but the last thing Australia needs is to import the damaging culture wars of the American far right, dominated by bonkers conspiracy theories adhered to by militant acolytes untroubled by reality.

Trump vowed to conduct ‘ideological screenings’ and to bar refugees from Gaza if he wins the Presidency and he’s also said he will bring back his controversial ‘Muslim ban’ on immigration. Similarly, Dutton has been echoing Trump’s call to ban refugees from Gaza, arguing that accepting people coming from Gaza is a national security risk. Zali Steggall described the policy as ‘inherently racist’ and this week Treasurer Jim Chalmers said: “[Dutton] divides deliberately, almost pathologically, and that sort of division in our leadership, in our society, right now is worse than disappointing — it’s dangerous.”

On this episode of Dollars & Sense, Greg and Elinor discuss the Greens’ ‘Robin Hood’ tax proposal, post-pandemic profits and the latest inflation data.

Greg Jericho is Chief Economist at the Australia Institute and the Centre for Future Work and popular columnist of Grogonomics with Guardian Australia. Each week on Dollars & Sense, Greg dives into the latest economic figures to explain what they can tell us about what’s happening in the economy, how it will impact you and where things are headed.

Host: Greg Jericho, Chief Economist, the Australia Institute and Centre for Future Work // @GrogsGamut

Host: Elinor Johnston-Leek, Senior Content Producer, the Australia Institute // @ElinorJ_L

Show notes:

‘Unemployment is rising and Australia’s economy is weak – but don’t hit the recession alarm just yet’ by Greg Jericho, Guardian Australia (August 2024)

This article was originally published, in slightly different form, on Southern Urbanism. It is shared here with permission. In-line images were provided by the writer.

The media industry has changed radically over the last three decades, transformed by the 24-hour news cycle, social media and the tech giants, and now artificial intelligence. On this special episode of Follow the Money, recorded live at Politics in the Pub in Canberra, Minister Ed Husic, Senator Sarah Hanson-Young and Karen Percy from the Media, Entertainment & Arts Alliance (MEAA) discuss technology, trust and the future of journalism.

This discussion was recorded live on Wednesday 21 August 2024 and things may have changed since recording.

Guest: The Hon Ed Husic MP, Minister for Industry and Science

Guest: Senator Sarah Hanson-Young, Greens Arts & Communications spokesperson // @sarahinthesen8

Guest: Karen Percy, Federal President (Media), Media, Entertainment & Arts Alliance (MEAA) // @PercyKaren

Host: Richard Denniss, Executive Director, the Australia Institute // @RDNS_TAI

Host: Ebony Bennett, Deputy Director, the Australia Institute // @ebony_bennett

Theme music: Pulse and Thrum; additional music by Blue Dot Sessions

“What do you need to solve the climate crisis? The answer is, everyone.” This quote from climate scientist Katherine Hayhoe highlights the importance of collective action, which is crucial in the travel industry, an industry which is at the heart of the global economy yet contributes substantially to climate change. The travel and tourism sector contributed 9.1% to global GDP in 2023, but it is responsible for 8% of global GHG emissions. Due to these environmental externalities, many key travel companies have shifted their focus so that they are no longer solely prioritising profit maximisation and are now trying to mitigate their environmental damage. To ensure that the global tourism industry doesn’t continue to compromise our planet, sustainable travel practices must be adopted by all. In this blog post we explore three ways in which travel for tourism can be conducted more sustainably: eco-tourism, carbon emissions offsetting, and global environmental projects. Additionally, we will discuss how governments can support and encourage sustainable tourism through regulations and subsidies.

Ecotourism Destinations

In February 2024, Taylor Swift’s The Eras Tour ignited a diplomatic dispute among ASEAN countries, after the Singaporean government subsidised the tour at a cost of US$2-3m per show, in exchange for Swift to perform her Asian shows exclusively in Singapore. In response Singapore’s neighbours complained of ‘betrayal’, arguing they could have also subsidised Swift’s concerts. This competition among ASEAN countries to host such ‘mega-concerts’ stems from the economic boost such can provide, a phenomenon dubbed ‘Swiftonomics’. It is reported that after The Eras Tour, Singapore’s GDP increased by 0.2%. This case demonstrates how concerts can have substantial economic implications, as Southeast Asia’s ‘competition states’ jostle to attract the investment and growth opportunities that come with them.

This week the Pacific Islands Forum meeting in Tonga will see leaders from the region address the dramatic impact of climate change and the urgent need to reduce emissions. It is an important moment for the Australian government to reject the lies of the gas industry and acknowledge that approving more gas will ruin the livelihood of the millions living in the Pacific Islands.

Gas is a massive contributor to greenhouse gas emissions (the clue is in the name!) that cause climate change. And given the world has just experienced 13 straight months of record setting temperatures, it is brutally clear that we need to reduce emissions quickly and with much greater urgency than has been the case over the past decade. But reducing emissions is not compatible with gas company profits, so gas companies and their boosters in the media routinely bring out a scare of gas shortages and with it calls for more gas.

Australians have gone through another winter without running out of gas despite being told earlier this year that a gas shortage was very much on the cards. And so of course now the gas industry is warning that a gas shortage could still occur because… well… because the gas industry knows that the only way it can justify demanding the government approve new gas mines is if people think we are about to run out.

This article was originally published, in slightly different form, on Southern Urbanism. It is shared here with permission. In-line images were provided by the writer.

Whether lazing by the seaside during the summer, or escaping to exotic beaches during the winter, coastal regions have always been a space for relaxing. This form of travel is called ‘Coastal Tourism’, which is defined as  the temporary movement of people to aquatic environments or ‘blue spaces’.  Overtime, as recreation has become more valued to human wellbeing, coastal tourism has gained popularity through offering engaging scenery and a relaxing break from the day to day grind. With gaining popularity however, our natural spaces have been captured by the tourism industry, with large resorts dominating coastlines. Through sustainability scares and aggressive capitalism, our beaches are starting to lose their sex appeal.

Tourism and climate change; environmental impacts

Blue spaces are more than just natural resources. With island states, tropical beaches and surf coasts appealing to holiday goers, the profitability and subsequent privatisation of the tourism industry has shifted focus from the ecosystem and the cultural significance of the landscape. This is capitalist tourism, which favours economic benefits to the detriment of environmental sustainability.

This process, in conjunction with the threat of climate change, has global and local consequences.

ABC journalist and podcaster Matthew Bevan joins Dr Emma Shortis on this After America to discuss the Democratic National Convention and Trump’s to set the agenda.

This discussion was recorded on Monday 26 August 2024 and things may have changed since recording.

Guest: Matthew Bevan, host and writer of If You’re Listening, the ABC // @MatthewBevan

Host: Emma Shortis, Senior Research for International & Security Affairs, the Australia Institute // @EmmaShortis

Show notes:

‘Harris delivers warm and strong acceptance speech as Democrats take joy, hope and renewal to the electorate’ by Emma Shortis, The Conversation (August 2024)

Theme music: Blue Dot Sessions

For over two years now it has been clear that profits have been the main culprit of inflation, and that wages have not driven prices despite repeated warnings from the Reserve Bank and business groups that a wages breakout could be about to come and start a mythical “wage-price spiral”

The latest data on wage growth in Enterprise Agreements from the Fair Work Commission (FWC) is just the latest evidence that reveals how wrong those spreading a fear campaign about wages have been.

In the 3 months to 26 July this year, the 3 month weighted average of annual wage growth in enterprise agreements lodged with the FWC was 3.7% – down from a peak of 4.3% in October 2023. The last time the average was this low was in August last year. Importantly the 3.7% growth is lower than the most recent annual inflation figure of 3.8%.

While business groups and conservative media outlets continue to argue that wage growth is keeping inflation high, in reality – as has been the case for the past 2 years – wages are not driving inflation, indeed they are lowering it.

One of the most regular and biggest scare campaigns Australians are subjected to is that Australia is about to run out of gas – that households will not be able to run heaters in winter or the light will go out in summer and the air conditioners will stop working because there will be no gas to power the electricity.

These warnings are increasingly shrill. In March for example The Australian newspaper warned that “Urgent action needed if Australia is to avoid catastrophic gas shortfall”. Despite getting through winter without a catastrophe this morning The Australian newspaper is now warning, that a “Perfect storm’ warning” has been issued to Australia’s east coast energy market.

It is all balderdash.

Australia digs up and exports a lot of gas. A really, really large amount. How much? Try 82,000,000 tonnes of the stuff each year. That is the 2nd largest amount of LNG production in the world, suggesting we are pretty good at it. But all that gas ends up as global greenhouse gas emissions and we’re meant to be reducing emissions.

While the intention to reduce the influence of corporate political donations is welcome, the proposed legislation would disproportionately advantage incumbent parties, including enormous increases in public funding, much of which could be spent on election campaigning.

The Australia Institute’s submission to the government consultation into the Bill finds that:

On this episode of Dollars & Sense, Greg and Elinor get out the world’s tiniest violin for Australia’s big banks, who are finally having to compete to offer better mortgage rates, and discuss why three of the ‘big four’ are now offering less for term deposits.

Greg Jericho is Chief Economist at the Australia Institute and the Centre for Future Work and popular columnist of Grogonomics with Guardian Australia. Each week on Dollars & Sense, Greg dives into the latest economic figures to explain what they can tell us about what’s happening in the economy, how it will impact you and where things are headed.

Host: Greg Jericho, Chief Economist, the Australia Institute // @GrogsGamut

Host: Elinor Johnston-Leek, Senior Content Producer, the Australia Institute // @ElinorJ_L

Theme music: Blue Dot Sessions

We’re told it’s a cost-of-living crisis, but not everyone is feeling the pinch. New Australia Institute research shows that the ultra-rich are getting richer, thanks in part to Australia’s distorted tax system. On this episode of Follow the Money, Dr Richard Denniss and Dave Richardson join Dr Alice Grundy to discuss the growing problem of inequality and what we can do to fix it.

This discussion was recorded on Tuesday 20 August 2024 and things may have changed since recording.

Guest: Richard Denniss, Executive Director, the Australia Institute // @RDNS_TAI

Guest: David Richardson, Senior Research Fellow, the Australia Institute // @daverr01

Host: Alice Grundy, Anne Kantor Research Manager, the Australia Institute // @alicektg

Show notes:

Wealth and inequality in Australia by David Richardson and Frank Stilwell, the Australia Institute (August 2024)

‘The Morrison election: What we know now’ by Richard Denniss, The Monthly (June 2019)