Single photo says it all about the real reason Australians feel so poor right now

Daily Mail​

6 hours ago

Australia's prohibitively expensive electricity prices and high government spending have been blamed for the nation's productivity crisis.
Nationals senator Matt Canavan has convened an alternative roundtable at Parliament House in Canberra to Treasurer Jim Chalmers ' three-day Economic Reform Roundtable.
Chalmers is trying to find policy solutions to Australia's slipping living standards.
Senator Canavan said: 'There was no mention of a tripling of electricity prices that have occurred in the past 20 years.'
'There's no mention of the government spending that we've seen that is crowding out private investment.'
Canavan, a former economist with the Productivity Commission, noted that from 1990 to 2004, electricity prices had fallen by 19 per cent.
'We actually got in there and made some hard decisions and we lowered the cost of living for Australian people and of course helped Australian businesses compete with the rest of the world,' he said.
'Of course, since then we've lost complete control of electricity prices.'
During the 1990s to the mid-2000s, Australia's productivity - or hourly output per worker - increased by an average annual pace of 2.1 per cent during the first decade of the internet.
That was a far cry from the one per cent plunge in the year to March on Anthony Albanese's watch as Prime Minister.
The Reserve Bank has slashed its growth forecast to just 0.7 per cent a year for the next two years.
Economists have linked Australia's weak productivity growth during the past decade to a reluctance by companies to invest in new technology and machinery that would make businesses more productive.
'We are not, in my view, going to fix our productivity crisis if we cannot lower energy prices in the country, it's as simple as that,' Canavan said.
Gary Banks, a former chairman of the Productivity Commission, said Australia's productivity crisis risked making Australians poorer.
'Productivity ... has become a matter of general concern if not consternation,' he said.
'Even more concerning is the expectation, which is embedded in the Treasury's latest Intergenerational Report, of a much diminished future rate of productivity growth compared to what it was in the past.
'That will bring with it a comparable diminution in income growth and thus living standards in the longer term.'
Chalmers on Wednesday said the second day of his three-day roundtable would focus on addressing Australia's productivity crisis.
'The first day was about resilience, today is about productivity and tomorrow more fundamentally about the Budget,' he said.
'But we all know those three things are very tightly linked.
'Productivity really sits at the core of so much of what we're trying to achieve.
'In the conversations yesterday about attracting more investment, about capital deepening, capital flows in the world and in our own economy.
'Productivity is the central focus of the government, of today's part of the roundtable, but also the work that we will all do in the months and years ahead.
'It was a really deliberate decision by our government to put productivity at the centre of our economic agenda and that's primarily or exclusively because that's how we get those higher living standards that we need to see in our economy.'
Treasury is forecasting a string of deficits for at least the coming decade with government spending as a proportion of the economy at the highest level since 1986, outside of the Covid pandemic.
Shadow treasurer Ted O'Brien told Canavan's summit that workers would end up paying higher income taxes unless government spending was restrained.
'Absolutely key to where the real problem lies, that is, the government has to stop the spending spree because if it doesn't, then it's only going to go after more taxes, and the only tax they are really relying on is income tax increases,' he said.
'That's entirely what they think is going to close the gap of the deficits.'
Income taxes are expected to make up almost 52 per cent of commonwealth revenue during this financial year with neither side of politics committed to raising the GST from 10 per cent or broadening it to cover fresh food, health and education.
Labor is also committed to a net zero by 2050 target and a 43 per cent reduction by 2030.