House price falls are not the economy’s biggest worry
Reserve Bank governor Dr Philip Lowe had more sensible things to say in three hours than we usually get in a month.
Here Ross Gittins, economist at the Sydney Morning Herald, sheds crocodile tears over wages suppression and associated low household incomes. He backs up and adds to the same crocodile tears of the Governor of the Reserve Bank. And, they aren’t the only ones.
The crocodile tears are necessary because wage stagnation is a problem.
Their joint solution though is that the problem be solved by just waiting for it to happen. Let the market weave its magic. Above all, shed so many tears about how bad it is so that everyone else sleep walks into waiting for the market to fix the problem.
Yet, there is a solution, other than the trickle down effect of the market. Put power into the hands of workers so that they can take the effective action necessary to win higher pay rises.
But that means a “right to strike”, a democratic right that has been effectively denied to Australian workers by Labor and the LNP so that it helps to create wage stagnation.
So, what would Gittins and Lowe say if workers here and there, and then perhaps in bigger numbers, took defiant action in spite of the prohibitive laws for pay rises? Even though that action would solve, in part, the problem they are crying about now.