real economist

Channeling Hayek. Challenging mainstream narratives on economics & geopolitics. Analyzing power, policy, and markets. Independent, unapologetic truth-seeker.

[real economist @x197324]

Stephen, Australians are not concerned about a poster. They’re concerned about the cost of living, housing affordability, power prices, mortgage repayments and whether their children will be able to buy a home.

The real story is that households have endured years of financial pressure while government spending has continued to expand. Families are paying more for groceries, insurance, rent and energy than they were a few years ago.

Instead of attacking Senator Hanson, perhaps the focus should be on why so many Australians are frustrated with the political establishment. Dismissing those concerns as “incoherent blather” only reinforces the perception that ordinary Australians are not being listened to.

You served as an economic adviser during the Gillard era and have long advocated for progressive economic policies. That’s your right. But Australians are entitled to ask whether decades of increasing government intervention, spending and bureaucracy have actually delivered better outcomes.

Housing affordability is at crisis levels, productivity growth has stalled, and many households feel they are working harder just to stand still. The debate should be about these issues—not about whether a poster received media coverage.

Australians don’t need lectures from economic commentators. They need answers on how we’re going to reduce cost-of-living pressures, improve productivity, increase housing supply and restore confidence in the economy.

That’s the conversation voters are having, whether the political class likes it or not.

A few factual points you can legitimately reference:

Australia experienced inflation peaking above 8% during the global inflation surge after COVID, with interest rates rising significantly as the Reserve Bank attempted to bring inflation back under control.
Housing affordability remains one of the biggest concerns for Australians, with home prices relative to incomes remaining historically high.
Stephen Koukoulas was a senior economic adviser to former Prime Minister Julia Gillard and remains a prominent commentator aligned with progressive economic views.

[real economist @x197324]

Stephen, this is selective history dressed up as economics.

John Howard inherited net Commonwealth debt of around 18.5% of GDP in 1995–96 and by 2007–08 Australia had net financial assets of 3.8% of GDP. That was not “vandalism”; that was fiscal discipline. Treasury also notes asset sales contributed, but budget surpluses were the major driver.

On tax: Australia’s tax-to-GDP ratio peaked around 30.4% in 2000, and in 2023 it was 29.9%, still below the OECD average. So the “largest taxing government in history” line needs proper context.
On productivity: Treasury says Australia’s strongest productivity period was the late 1990s, driven by microeconomic reform, not reckless spending.
And Stephen, given you were Senior Economic Adviser to Julia Gillard and worked in Treasury, you know the Labor/Rudd-Gillard period left Australia with rising debt, structural deficits and no serious productivity reform agenda.
The real vandalism is pretending disciplined budgets, lower debt and reform caused today’s productivity crisis. They didn’t. Poor reform, higher spending, weak investment incentives and bad policy since then did.

[real economist @x197324]

@LindaSilmalis New faces, old faces, recycled faces… meanwhile One Nation is quietly sharpening the broom. 🧹

[real economist @x197324]

“Stephen, productive Australians aren’t leaving to ‘save a few dollars.’ They’re leaving because Labor has created an environment where success, investment and entrepreneurship are treated like targets to tax rather than engines of growth.

Capital flight isn’t emotional — it’s economic reality. When investors and business owners leave, Australia loses jobs, innovation, philanthropy and future tax revenue.

And the ‘there’s a queue of thousands wanting to live here’ argument misses the point entirely. A nation cannot sustainably replace wealth creators with bigger tax burdens and expect stronger productivity.

This government is slowly turning Australia from an investment destination into a warning sign.”

[real economist @x197324]

Stephen, this argument ignores one basic reality: Australians are getting pushed into higher tax brackets by inflation even when their real spending power barely improves. That’s not a tax cut it’s stealth taxation.

Indexing tax brackets simply stops governments from profiting off inflation-driven wage rises. If inflation goes up 5% and wages rise 5%, why should workers pay a higher marginal rate when they’re no better off in real terms?

Even economists across the spectrum acknowledge bracket creep quietly increases the tax burden every single year without Parliament openly voting for higher taxes.

And the claim this would force massive rate cuts is questionable at best. Leaving more money in workers’ pockets isn’t automatically inflationary when households are already crushed by mortgage repayments, energy costs and cost-of-living pressures.

The real issue is governments becoming addicted to bracket creep revenue because it’s politically easier than honest tax reform

[real economist @x197324]

@TheKouk Kouk accidentally posted the economic equivalent of:
‘The private sector carried the economy on its back… therefore government should get the credit.’
Peak Labor economics.

[real economist @x197324]

Another rate rise.

Australians aren’t “tightening belts” anymore - they’re drowning.

Mortgages up. Rents up. Food up. Power up.
Meanwhile wages can’t keep up and small businesses are getting smashed.

At what point does “fighting inflation” start destroying the people it’s supposed to protect?

#auspol #RBA #InterestRates #CostOfLiving #Australia #Inflation #SmallBusiness #MortgageStress

[real economist @x197324]

Maureen, that’s a very selective read of history.

The IMF has never “twice voted” the Liberal Party of Australia / National Party of Australia coalition as the “most profligate government ever” — that claim doesn’t stack up. In fact, the John Howard / Peter Costello era delivered repeated budget surpluses and paid down net government debt to effectively zero.

As for the Scott Morrison government — yes, spending increased significantly, but that was during a once-in-a-century global shock (COVID-19 pandemic), when governments worldwide injected stimulus to prevent economic collapse. That’s hardly comparable to peacetime structural spending.

The real issue now is persistent, ongoing spending in a high-inflation environment — which is exactly what forces the Reserve Bank of Australia to tighten and, as even Stephen points out, deliberately slow the economy.

You can’t blame temporary crisis spending for today’s structural inflation pressures, while ignoring current policy settings that are keeping demand elevated.

If we’re going to debate this, let’s stick to facts — not political folklore.

[real economist @x197324]

Stephen, this “long-term strength” line sounds great in an article — but try selling that to families choosing between groceries and their mortgage.

You call it “temporary pain” — for a lot of Australians it’s looking a lot like permanent damage. Inflation’s still biting, interest rates have crushed borrowing capacity, and people are genuinely going to the wall. That’s not theory, that’s reality.

At some point you’ve got to ask — if all this government spending was meant to help, why are households worse off? Because right now, there’s no “long-term gain” in losing your home.

[real economist @x197324]

@chriscornish @TheKouk Got it — aimed at Chris:

Everyone’s saying it’s unsustainable now ditto for Australia.
The difference is some of us have been calling it for 10–15 years.
Chris, welcome aboard some of us were saying this long before it became obvious.

[real economist @x197324]

Australia’s debt-to-GDP at ~35% looks low on paper compared to other advanced economies no argument there.
But that’s exactly why complacency is dangerous. We’re importing the same fiscal habits as the US, just earlier in the cycle.
It doesn’t stay “low” if deficits become structural and interest costs start compounding.
The issue isn’t where we are — it’s the trajectory.

[real economist @x197324]

@harry_zuma @TheKouk Love a good debt scare post… just missing the bit where Labor inherited the tab from the ‘back in black’ era.
Net debt ~$19k per Aussie — not a crisis, but the trajectory matters.
The risk isn’t who to blame, it’s that we keep normalising deficits while interest bills stack up.

[real economist @x197324]

@mariodayba Let’s do something about it. Instead of just talking about it, let’s start by not voting incumbent political members of Lebanon. And start a proper revolution by kicking them out.

[real economist @x197324]

“Kouk’s Crystal Ball”

Old Kouk’s back with charts so neat,
Telling us inflation’s beat.
Rates will fall, just wait and see—
“Trust the data… trust me.”

But deficits are running wild,
Spending spree dressed up as mild.
Printing cash to smooth the ride,
Then acting shocked when prices rise.

He hums the tune of Canberra’s choir,
“Soft landing” is the phrase they hire.
Yet every time they steer the ship,
It’s taxpayers who feel the slip.

While Hayek warned what comes from this
Too much control, too much “assist.”
Markets speak, but few will hear,
When policy’s the puppeteer.

So here’s a thought, just one to keep:
You don’t fix fires with petrol heaps.
And if this “plan” is truly grand…
Why’s everything still out of hand?

[real economist @x197324]

Mate, you’re counting debt like it’s disappearing quick,
But rolling it over’s still the same old trick.
A maturity drops, you call it a win,
While new bonds pop up,same game, new spin.

Debt down on paper, sounds clever and neat,
But refinancing’s just shifting the seat.
So if that’s “falling,” then here’s the twist
Your maths looks sharp… but your logic got missed.

[real economist @x197324]

@nyunggai Warren, fair enough—the Pope isn’t God. But comparing yourself in the same breath? That’s a bigger stretch than the Titanic making a U-turn. Maybe stay in your lane.

[real economist @x197324]

@PaliNewsNetwork @pnn_nyc What about the Palestinians who came to Lebanon and killed Christians? Some of those Palestinians who committed these acts were also Christians. Why do Palestinians continue to be expelled from various Arab nations, including Lebanon, which is not considered an Arab nation?