Sorry, this isn't the day we stop feeling sorry for ourselves

I’m sorry to be the one to break it to you, but I very much doubt that this small cut in interest rates will be the circuit breaker everyone from Treasurer Jim Chalmers down has been hoping for. After our many months of longing for this moment, such a modest saving can only be an anticlimax.I doubt this will be the reason the economy begins to recover as we all go out and shop. Nor will it be the sea change that secures another...

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When does bipartisanship happen? When there's mutual self-interest

If you think Labor and the Liberals are always at each other’s throats and never agree on anything, you haven’t been watching closely enough. Sometimes – last week, for instance – they do deals with each other they hope we won’t notice.When they’ve reached an agreement they don’t want seen, it’s because they’ve colluded to do something that advances their interests at the expense of the voters.It reminds me of economist Adam...

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We may be short of leaders, but we're not short of false prophets

With this year’s federal budget supposedly brought forward to March 25, the seasonal peak in business bulldust has come early. Last week Canberra kicked off an annual ritual little noticed in real-world Australia, the call for “pre-budget” submissions on what the government should do in its budget.I’ve never known any of that free advice to be acted on but, as all the participants in the ritual understand, that’s not the point....

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Maths or no maths? Ross Gittins and Richard Holden have it wrong

By MILLIE MUROI, Economics WriterWe’ve heard the old(er) boys argue over the optimal level of maths in economics, but they’ve delivered some imperfect information. Don’t know what I’m talking about?Seven years after sitting my final high school economics exam, four years after farewelling university economics, and three years since exiting the economics profession (almost) entirely, I’ve been reflecting.The reason? A clash between...

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The nation is finally coming to grips with home affordability

Right now, the prospect of much improvement in being able to afford a home of your own isn’t bright. We don’t look like solving the problem any time soon. But I’ve been watching and writing about the steady worsening in housing affordability for the best part of 50 years, and I’m more optimistic today than I’ve ever been.Why? Not because we’ve got the problem licked – and certainly not because mortgage interest rates will soon...

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Everyone hates government spending - until someone tries to cut it

It seems government spending will be an issue we hear a lot of in this year’s federal election campaign. But remember this: much of what’s said will be influenced by partisanship, ideology, self-interest and populism.Peter Dutton is making wild claims that need fact-checking. The business press is saying things that aren’t a lot better. And the debate will proceed according to an eternal political truth: while voters never mind...

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Economists find social media harms young people's mental health

By MILLIE MUROI, Economics WriterIf the latest research is anything to go by, my risk of developing a mental health disorder is rather high compared to much of the population. I’m in my mid-20s, female, and I can’t remember a day in the past decade that I’ve gone without social media.My first year of high school was the first year I dipped my toe into the space. Until I was about 12, communicating with anyone outside of family,...

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In 50 years, Trump will be remembered as just a puzzling footnote

I know I’m a bit late, but welcome to 2025. Before we get on with a year of absolutely gratuitous economic angst courtesy of a great American conman’s second coming, let’s take a breath and realise we’re already a quarter of the way through what many still think of as the “new” century.How time flies while you’re preoccupied with one crisis – one damn thing – after another. I hate to undercut the media’s business model, but old...

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Want more economics students? Drop the obsession with maths

The Reserve Bank is worried. The number of students wanting to study economics has been falling over the years, and it’s worried this will lead to a fall in the electorate’s economic literacy, which could end up worsening government policy.And the Reserve, being by far our biggest single employer of economists, may be worried its choice of potential recruits will deteriorate.An article by the Reserve’s Emma Chow, published last...

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Think the measurement of inflation's a bit off? You're probably right

By MILLIE MUROI, Economics WriterIf you’ve ever looked at the latest inflation figures and thought to yourself it doesn’t really reflect the ballooning or shrinking prices you’ve been paying, you’re probably right.Like most measures of our economy’s health, the consumer price index (CPI) – our main inflation gauge – is only a rough estimate of what’s happening to prices. It tracks changes in the costs of a vast range of things...

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Why we'd be mugs to focus on the cost of living at the election

It’s a good thing I’m not a pessimist because I have forebodings about this year’s federal election. I fear we’ll waste it on expressing our dissatisfaction and resentment rather than carefully choosing the major party likely to do the least-worst job of fixing our many problems.Rather than doing some hard thinking, we’ll just release some negative emotion. We’ll kick against the pricks – in both senses of the word.We face a...

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Should we really go forth and multiply?

By MILLIE MUROI, Economics WriterFor most of human history, it’s been a miracle for us to survive long enough, or reproduce vigorously enough to rapidly grow in numbers. But as we’ve gotten better at dodging tigers, killing germs and containing pandemics, we’ve also become increasingly intrigued and hungry to know how many of us there are, how many of us there will be and how it will affect our lives.Just before Christmas, the...

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How two economists got themselves more say in government policy

By MILLIE MUROI, economics writerFor all the havoc it has wreaked, some good things were born from the pandemic: widespread hybrid working for one. Another was the emergence of e61: a novel name – not for a virus or robot – but for a factory for economic findings.“What’s new about that?” you might ask. Well, it’s breaking a decades (perhaps centuries) old habit of people sticking to their lanes. Despite the important work done...

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The many different effects of the fall in our dollar

By MILLIE MUROI, Economics WriterThe Aussie dollar seems to have been slammed by a truck over the past few weeks, but it’s not all bad news. Plenty of people – not just overseas friends paying us a visit or buying our stuff – will be lapping up the benefits.As we rang in the new year, we rang in two since the Australian dollar could buy more than US70¢. Now, it’s scratching about at US62¢. You’d have to trek back to the early...

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The secret to better health and less obesity is a tax

By MILLIE MUROI, Economics WriterIf you’re like me, chances are that during the silly season you indulged in a bit more of the guilty pleasures than usual. I would make a bet though (and hit bingo about 90 per cent of the time) that it wasn’t tobacco that you reached for, but sugary treats – and maybe a bit of alcohol.The rates at which we tax tobacco might have you thinking that smoking is among the biggest health risks we face....

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What's happened to the cost of living is trickier than you think

It’s been a year of wearying in the fight against inflation. But if you think you know what it all proves, you’re probably kidding yourself. The first mistake is to subject it to too much rational analysis.While voters in Oz complain incessantly about “the cost of living”, the mug punters who put Donald Trump back in the White House were said to be on about “inflation”. Aren’t they the same thing? Well, maybe, maybe not.A penny...

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