Angus Taylor believes it’s Labor fault that inflation is out of control, telling InvestorDaily in an exclusive interview that “it can be done better”.
“The reason I’m so confident of that is because I saw us ultimately doing better in beating inflation last time we had it,” the shadow treasurer said.
The formula, according to Taylor, is “less government spending” and “less government regulation”.
“The great learning from the seventies and the eighties, which inspired my interest in economics, was that if you get government out of the way, government doing less, spending less, intervening less in the economy, that’s your best chance to beat inflation,” he said.
“We had leaders who understood that back in that era, obviously on our side of politics, John Howard, and in other countries, people like Ronald Reagan and Margaret Thatcher, they were crucial to beating inflation. But to give credit to the Labor party, I think Bob Hawke was really important in beating inflation, too. And he was a much more conservative person economically than we’ve seen from anyone from Labor in recent years”.
Taylor stated that despite public criticism, the Coalition has opposed significant portions of the $209 billion spending increase since Labor took office, aiming to combat inflation.
“Meanwhile, they’re [Labor] pushing through industrial relations legislation, raising the cost of everything. We know it’s raising the cost of building anything in this country and building houses, building roads, you name it, we’re going to see a lot more of that. You don’t do those things when you’ve got an inflation crisis.
“We’ve got to get back to our liberal principles. That’s how we beat inflation. That’s how it was beaten last time.”
Getting back to these liberal principles, according to Taylor, is also key to driving economic growth and productivity, both of which he described as “diabolical”.
“The economy has essentially stopped on a GDP per capita basis. Three quarters in a row, GDP per person has gone backwards. And meanwhile, we have a very low unemployment rate. So, it’s sort of odd, isn’t it, that we’ve got a household recession, a family recession, and at the same time, you’ve got this low unemployment rate. And the reason is productivity is completely shot.
“And until you fix that, you won’t have a sustainable victory against inflation and you won’t get to a strong growing, low inflation economy. Productivity in Australia is much worse than we’ve seen in almost any other advanced country in the world. The UK, the US, all better than us. And it really is a diabolical situation,” he said.
Looking towards next month’s budget, the shadow treasurer added he hopes it will give Australian’s a pathway to prosperity, liberating them from the “terrible productivity malaise and standard of living malaise that they’ve suffered from in the last couple of years”.
“We need to see Labor recognise the back-to-basics agenda that’s necessary to beat inflation, to get a strong, growing economy. To recognise that enterprise has got to be at the centre of the economy, not government. And I think that kind of budget can set Australia off on the right course. I’m hopeful, but, yeah, we’ll see, we’ll see.”
To hear more from Taylor, tune in to our podcast.
Maja Garaca Djurdjevic
Maja's career in journalism spans well over a decade across finance, business and politics. Now an experienced editor and reporter across all elements of the financial services sector, prior to joining Momentum Media, Maja reported for several established news outlets in Southeast Europe, scrutinising key processes in post-conflict societies.
