Of trust and trusts

Our existing political elites fundamentally broke trust over the COVID debacle. They panicked, threw the manual out the window, and then used the full power of the state, and state adjacent institutions like universities and media, to impose panic on the whole population and make it compulsory.

Now the lies and incompetencies have become apparent but as most voters aren’t prepared to verbalise this, and most politicians aren’t prepared to admit it, the bond of trust between most elected figures and the electorate has been corroded.

The resulting quest for authority with authenticity is flowing around the world and resulting in the popularity of politicians like Donald Trump, Nigel Farage and Pauline Hanson.

In January before the last federal election voters had high hopes that Peter Dutton was the authentic real deal. By May they realised he was offering much the same as Labor, just with a slightly different fabric, so they chose the original and voted Labor.

This wasn’t an enthusiastic choice, this was a government elected with one of the smallest first preference votes in the modern era, even though it resulted in a two-party preferred vote of massive proportions.

The result built a tall, but rickety pile of government on shaky foundations, which looked deceptively powerful to its owners. This led our Daggy Dad PM and his youthful Treasurer Tonto, to decide to burn some political capital in pursuit of policies they’d dreamt about for years.

Policies like increasing the tax on capital gains and abolishing negative gearing, even though they’d denied they would do that at least 53 times during the election campaign.

They felt they could justify this on the basis of what they term “intergenerational inequity”, which purports to describe a situation where older Australians are getting an unequal share of the economy at the expense of their kids and grandkids.

One of the ways this inequity manifests is in the difficulty young people currently have buying a home.

There is a problem with this justification for the policy change. Everyone agrees that the major problem with home ownership is the supply of new housing but not only do the budget papers predict there will be fewer houses as a result of this new policy, but rents will rise.

On this basis house prices will probably rise as well, but it will be harder for young Australians to save a deposit because their already horrendously expensive rents will be even more horrendously expensive.

And it gets worse. People used to save for a deposit by putting their money in the bank. But interest rates have been so low for so long, and deposits so much more expensive that the task has become herculean and would-be homeowners have looked to ways to accelerate their saving.