By Nick Le Moignan
I STARTED writing these columns back in 2018 because I noticed some parallels between the ways Jersey people and Australians look at the world and enjoy life. As we surge nervously into 2024, on opposite sides of the planet, there are more similarities than ever in our priorities and concerns.
The differences are considerable: Australia’s island-continent is roughly 64,000 times the size of Jersey, with about 240 times as many people. Both are surrounded by glorious beaches, as well as seas whose moods range from seductive to tempestuous. Both sets of inhabitants appreciate our good fortune in possessing peace and plenty. We enjoy our freedoms of expression and association: we are not bound by the political or religious mumbo-jumbo that ruins lives in many other nations and cultures.
Sure, there are plenty of reasons for us all to fear the future – above all, the rapidly accelerating catastrophes of human-caused climate change, the brutal wars in Ukraine and Gaza, the potential for a wider conflict if China invades Taiwan and the appalling chance that US voters may elect a crazy, criminal, would-be despot to make America feudal again.
My choice of reading matter is eccentric: I suspect I am alone in reading both the Jersey Evening Post and the Sydney Morning Herald almost every day. Both papers offer thoughtful leadership and try to reflect their readers’ preoccupations – and they seem to agree that three issues are of great concern to their communities:
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The rapidly rising cost of living.
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An insufficient supply of housing.
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A fear that increased immigration may disadvantage local people.
The latest figures available from the Australian Bureau of Statistics (to September 2023) show annual rises in the cost of living of between 5.3% for aged pensioners to 9.6% for employee families. The difference is largely accounted for by mortgage repayments. Jersey’s Retail Price Index rose by 10.1% over the same period, compared with a rise of 8.6% in the UK. ITVX says that means “£100-worth of goods or services when records began in June 2000 would cost around £227 today”.
Of course, price inflation must be matched by wage inflation – and overall inflation needs to be kept within acceptable limits – but a measure of inflation is preferable to stagnation or stagflation, since it is the primary means of redistributing wealth from older, retired generations to younger, still working ones.
The current round of rising inflation, the first since the global financial crisis of 2008, is an unavoidable consequence of worldwide “quantitative easing” during the pandemic. If you increase the supply of money without increasing the supply of goods and services, prices must rise.
The simple logic of the economics is little consolation to working families struggling to survive from week to week. Voters tend to blame recently elected, popular leaders like Kristina Moore and Anthony Albanese for such problems, even if they are way beyond their control. The PM’s party colleagues will, however, protect him from any vote of no confidence, as Labor seems to have learned the lesson of the Rudd/Gillard/Rudd job-swap years.
Once Australia’s New Year fireworks had faded, Albanese and his Treasurer, Jim Chalmers, came out fighting. They accused supermarket chains of “price gouging” (not passing on reduced costs to consumers) and threatened to cap prices and force supermarkets to reveal what they pay for produce. It’s too early to say how well this strategy will work, but it seems very much in tune with voters’ concerns.
The evidence against the stores looks strong: in the year to October in eastern Australia, wholesale cattle prices fell by 66% and lamb by 38%, but supermarket prices barely flickered.
For governments, the problem is how to help families without adding to inflation. Albanese’s other plan is to increase his already generous Energy Bill Relief Fund, which subsidises power bills for five million households. Such an option is presumably not open to Jersey, given its vast expenditure on paid politicians and public administration.
As in Jersey, Australia’s house prices have stayed high despite sharply rising interest rates and mortgage costs. The reason is a shortage of supply. Australian taxes favour older generations, allowing “negative gearing” on investment properties and subsidising privately held superannuation funds. Stamp duty, payable on property purchases, is another disincentive to downsizing. Labor lost the 2019 election for daring to question these concessions and they won’t be going there again.
The obvious answer is to build more houses and apartments – and you might imagine Australia has no shortage of space for them – but here, too, development approvals are hard-fought between the NIMBYs (Not in my back yard) and the YIMBYs (Yes…) and demand is still growing very much faster than supply.
That problem is exacerbated by last year’s huge, post-pandemic surge in immigration. It’s clear that immigrants perform a vital function in the long term, in helping the economy to grow, but, as elsewhere in the world, in uncertain times, newcomers trying to establish themselves are often viewed with suspicion by those already established.
All these difficulties are not new, and they are not ultimately as threatening as climate change, widespread wars and the destruction of democracy – but they are closer to our hearts and hip-pockets and easier to identify. It’s hard to take the long view when you’re struggling to pay the rent or put food on the table.
Australia’s Macquarie Dictionary, ever-alert to changing linguistic trends, chose “cozzie livs” as its Word of the Year for 2023. The phrase is apparently used (by nobody I’ve ever heard) as a colloquial substitute for “the cost of living”.
The Macquarie announcement glossed over the fact that its selection is not one word but two, admitted sheepishly that it was originally “coined in the UK” (!) but claimed that it had “resonated strongly with Australians”.
My fear is that future generations will compare us with the Emperor Nero, who is said to have fiddled while Rome burned. We may all be fussing about the “cozzie” while our “livs” are about to burst into flames.
