Third party intervention led by the US and France has achieved a ceasefire in Lebanon. The US now needs to push for a settlement in Gaza where the combatants withdraw, and an external force is charged with maintaining the peace. (more…)
Michael Keating
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Trump’s impact on the rest of the world, and Australia in particular
Somewhat surprisingly, careful analysis and modelling show that Trump’s crude attempt to Make America Great Again, mainly damages the American economy. The rest of the world, and Australia in particular, should proceed with their own business as usual. (more…)
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The US election campaign: Lessons for Australia
Just like in the US , the next Australian election will be decided by the cost of living. Both the US and Australian economies have performed quite well, in difficult circumstances. However, the lesson from the US election is that both Governments need to tell their story better. (more…)
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Changes to tertiary education funding fail to remedy “stupid inequity” of Morrison era
The changes to Tertiary Education funding announced by the Prime Minister last weekend, mostly benefit former students. Arguably there are other higher priorities to restore the funding of higher education and remove anomalies in the fees charged. (more…)
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Peace in Gaza: Part 2
A sustainable peace settlement in Gaza needs to meet the legitimate demands of the key parties, but given their inability to negotiate such an agreement themselves it will need to be proposed and implemented by the US and the major Arab nations under UN auspices. (more…)
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Peace in Gaza: Part 1
The death and destruction in Gaza continue, and now in Lebanon as well. There have been peace negotiations for a year, but so far unsuccessful. Today, Part 1 of this article examines why. Tomorrow Part 2 will discuss a possible way forward out of this disaster. (more…)
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Productivity growth has slowed: will it recover?
Restoring the rate of productivity growth is critical to future living standards, but unless technological change accelerates living standards may not increase as fast as we are used to in future. (more…)
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International comparisons of monetary policy
Much of the expert commentary on Australia’s monetary policy settings is guided by what is happening in other countries. However, monetary tightening can have a markedly different impact in different countries, and while Australia appears to have been more cautious, so far it seems to have managed well. (more…)
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Does the Reserve Bank need to change?
Shortly after he became Treasurer, in July 2022, Jim Chalmers announced a review of the Reserve Bank – the first since the current monetary policy arrangements were instituted in the 1990s. (more…)
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How to ensure a Gaza ceasefire
We are all appalled by the scale of the deaths and destruction in Gaza. Every day brings more terrible news. (more…)
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When should we expect interest rates to fall?
The Reserve Bank has explicitly warned against any expectation that interest rates will start to fall soon. On the other hand, the Treasurer recently claimed that the Reserve Bank is smashing the economy, implying that interest rates should fall soon. Who is right? (more…)
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The cost of living crisis is really a housing crisis
The evidence shows that the only households whose living costs have risen faster than their incomes are those homeowners with a mortgage. For the other two thirds of households, their incomes have risen faster than their living costs. Policy should therefore focus on why mortgage costs have risen so dramatically. (more…)
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Policy responses to the cost-of-living crisis
Improving housing affordability is the key to resolving the cost-of-living crisis, but the policy options are limited and will inevitably take time to have their desired effect. (more…)
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The cost of living and housing affordability
The cost-of-living crisis mainly reflects a decline in housing affordability. A consequence is that this crisis is much worse for middle-income people, who are typically middle-aged, and who are most likely to have a substantial mortgage. (more…)
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A future made in Australia?
Is Australia’s new industrial policy a way forward to a competitive, innovative, and sustainable future in which the benefits of new technologies such as renewable energy and artificial intelligence are widely shared throughout society? Or a reversion to past failed attempts to protect local industry, pick winners at taxpayers’ expense, lag in innovation and productivity while further contributing to growing inequality by enrichment of the rentier elites? (more…)
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Clutching at straws: America will not maintain its economic dominance
Although rarely acknowledged, China is the world’s biggest economy, and it will most probably continue to grow faster than the US, its main competitor. (more…)
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Dutton’s ignorant, incompetent policies contradicted by evidence
Dutton has finally started to show his hand and build his campaign for the next election around energy policy and housing affordability. The problem is that his ignorance of the evidence demonstrates his incompetence. (more…)
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Labor’s 2024-25 Budget: competent but not outstanding
After considering Opposition criticisms, this article concludes that this Budget reflects Labor’s competent economic management. However, a more ambitious tax reform agenda is needed to adequately provide all the services that Australians expect. (more…)
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A future made in Australia: Can it work, what are the risks?
Claims that industry assistance comes at a cost to other industries and consumers are too often right. Industry policy should therefore be limited to areas of identified market failure and requires tight evaluation of each case and that performance targets are met. (more…)
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Why conventional economic theory is wrong about technological change
Society as a whole has a critical interest in the direction of technological innovation. This cannot be left uniquely to a limited group of capitalist bosses. Consultation with all the key interest groups and government regulation have a critical role to play in ensuring future economic growth and a fair go for all. (more…)
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The impact of AI on the labour market and equality
In future AI is the new technology which is likely to have the greatest impact on our economy and our society. But how AI is used and developed is a choice, and so far AI has been predominantly focused on continuing the emphasis on automation. To realise the full potential of AI and minimise its harmful effects there needs to be more public consultation and regulation to determine the future direction of AI. (more…)
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Sharing the benefits of technological progress
This is the first of three articles discussing how the benefits of technological progress are shared, and thus determine the distribution of income and influence our economic and social structures. This first article focuses on how these benefits have been shared historically. (more…)
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Housing affordability and equality: part 2
Yesterday, Part 1 of this article discussed the decline in housing affordability and the consequent increase in wealth inequality. Today, Part 2 will discuss possible policies to restore housing affordability in the interests of a more equal and cohesive society. (more…)
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Housing affordability and equality: part 1
The first part of this article explores how home ownership has become almost impossible for most aspiring first-home buyers and how that is creating a much more unequal distribution of wealth. A second part tomorrow will discuss the policy options to restore home ownership and thus a more equal and cohesive society. (more…)
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What does Dutton stand for?
Dutton regularly proclaims what he opposes, but what he will do in terms of new policies mostly remains a mystery or alternatively will not work. (more…)
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The future of tax reform
There are recurrent calls for tax reform, but it is typically too difficult to achieve a consensus. However, the necessary action to reduce carbon emissions by introducing a tax on carbon emissions could result in most people being better off and thus achieve broad support. (more…)
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Restoring Australia’s prosperity by becoming a superpower
The debate about climate change is far too often in denial. It needs to change to focus on the positives of how Australia can become a Superpower based on green energy and products that rely on green energy. (more…)
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US Intervention to end the war in Gaza
What is almost universally agreed is that an enduring peace settlement for Palestine must be based on a two-State solution. However, getting that settlement accepted will require active intervention by the US to broker the deal. (more…)
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Labor’s rejigged Stage 3 tax cuts benefit 84% of taxpayers
After due consideration of the main criticisms, the Labor Government’s rejigged Stage 3 tax cuts seem to be a good way of responding to the cost of living crisis without adding to the Budget deficit and inflation. (more…)
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Is China an economic threat?
America insists on treating China as an economic threat, but the reality is that China’s economic advancement has benefited us all. Instead, the stagnation of wages and manufacturing job losses experienced by Trump supporters in the US largely reflects the impact of technological change. (more…)