Jim “Chicken” Chalmers is as good a politician as he is Treasurer, which is not a compliment.
For the past several days, he has been on the hustings crowing about all of the jobs he has created. As well as blaming Australians for the housing crisis.
There are many ways to debunk this spin, but perhaps the best is to look at real wages. These capture both the inputs of rising wages and inflation, so they tell us pretty well whether living standards have been rising or falling under Treasurer Jim “Chicken” Chalmers:
As you can see, despite the Chicken’s protestations of victory, he has delivered the worst crash in living standards basically ever.
We can dig deeper and ask how much of this is directly the fault of the Chicken. After all, the government did inherit an economy with weak wage growth and rising inflation.
This terrific chart from Westpac that decomposes the Aussie CPI is a good place to start:
The chart shows that roughly 2% of annual inflation (rents, utilities and gas plus spillovers) have and will directly result from Chicken Chalmers’s decisions to let the gas cartel run wild and to unleash lunatic levels of immigration.
He has also been running spending too high, so that’s more at the margin, but we’ll be generous and leave that out.
To this, we must add the suppression of wages engineered by the Chicken via mass immigration.
This is not easy to do. We can guess that wage growth would have reached 4.5% and stayed there instead of stalling out at 3.7% (for a couple of quarters as Fair Work decisions flow through) and then falling back to 3% on the labour supply shock.
That is a lost income of 0.7% in year one. 0.9% in year two. And 1.3% in year three.
Roughly speaking, Chicken Chalmers’ mistakes will contribute 40% of the 7.3% fall in real wages probable over his tenure as Treasurer.
If we multiply that by real net disposable income per capita we get a Chicken Chalmers incompetence bill of $1837.98.
We could add the higher interest rates and externalities – such as crush-loaded public services, wrecked energy transition, homes lost, ruined environment, etc – but we’ll let those go too.
We should note that Chalmers’ incompetence bill does not fall evenly across households. It is much worse for lower-income Australians. Utilities are much larger components of their discretionary incomes. If you rent as well, then the Chicken has shafted you.
I suggest everybody invoice the Chicken to remind him that it is unwise to cluck while trashing living standards.
If you rent, double or triple the bill.
