Mark Riley: Jim Chalmers declares economic turnaround after months of government silence

West Australian

a day ago

The Albanese Government is now telling Australians something it studiously avoided telling them in the run-up to the election.
They are better off than they were three years ago.
'Living standards are getting better,' Treasurer Jim Chalmers declared this week after the release of the March quarter national accounts.
He had data to prove it.
The standard of living measure had grown in the first three months of the year by 1.7 per cent.
That was the same rate by which the measure had fallen in the same quarter immediately preceding the 2022 election.
It is quite a turnaround.
Inflation is back in the Reserve Bank's target range at 2.4 per cent, less than a third of its peak in late 2021.
Interest rates are lower and likely to fall even further over the coming months.
People's pay is increasing above inflation. That is, workers are finally enjoying real wage growth.
The Fair Work Commission's decision this week to lift the minimum wage by another 3.5 per cent — 1.1 per cent above inflation — will ensure the country's 3 million lowest-paid award workers will feel the immediate benefit of that.
And unemployment is steady, challenging the theory that falling inflation causes job losses.
All this adds up to one undeniable conclusion — the cost-of-living crisis is easing.
The data has been saying that for the better part of the past year.
Yet the Government wouldn't admit it during the campaign when Peter Dutton was asking voters 'whether you are better off now than you were three years ago'.
I put that to Anthony Albanese at the National Press Club in the final week of the campaign.
He wouldn't allow himself to admit that Australians really were better off.
Instead, he turned the question on its head by saying Australians would have been a lot worse of if Dutton had been prime minister because he had opposed most of the Government's cost-of-living relief measures.
Why did Albanese dodge the question? Because the election playbook says it's dangerous to tell voters they are better off.
It can sound like hubris, leaving the Government open to claims that it is out of touch with the real pressures on average Australians.
Recoveries are always patchy. Some people do well, some do really well, and some don't get much benefit at all in the short term.
There is a psychological, if not always practical, disconnect between the data and people's lived experience.
It is something Chalmers always acknowledges and did this week as a caveat to his declaration that things were indeed getting better.
'Now, we acknowledge, as I have probably 30 or 40 or 50 times in your presence, that sometimes or often, how people feel and fare in the economy doesn't match the aggregate national numbers that we see in the national accounts,' he said.
Those aggregate numbers were positive, if only just so.
They showed the economy growing at an anaemic 0.2 per cent in the March quarter. That is half the market expectations.
There are reasons for that. Some are natural: floods, drought and an ex-tropical cyclone. The biggest, though, is human: Donald Trump.
Trump's tariffs have cast a cloud of uncertainty over international trade that is affecting global investment and confidence.
Equity markets are zooming to new record highs on what the Financial Times has dubbed the 'TACO principle', which dictates that Trump Always Chickens Out.
Anthony Albanese is likely to meet the President on the sidelines of the G7 in Canada in about 10 days, asking him politely to chicken out of his tariffs on Australian exports.
At the same time, Trade Minister Don Farrell is trying to land an agreement on a potentially rich free trade deal with Europe.
If the Government can pull both those things off, it might just be able to go to the next election telling voters they really are better off.