INTERESTING DEVELOPMENTS
The Reserve Bank will probably hike the interest rate of 0.35% today, possibly to 0.85% which would add an extra $140 a month on mortgage repayments of around $500,000, according to Rate City. But The Australian ($) was more demure, saying it’ll probably climb to more like 0.6%-0.75% instead. It’s the second of several hikes expected leading up to Christmas by which time it could’ve climbed as high as 2% according to Macquarie Bank, AMP and Goldman Sachs — The Courier-Mail ($) says that would plunge half a million more Queenslanders into mortgage stress. So how does our interest rate compare with the world? In the US, it’s 1%, as BBC reports — it jumped from 0.75% in March, the country’s biggest increase in 20 years. It’s the same in the UK, the broadcaster continues, where interest rates went from 0.75% to 1%, the highest level in 13 years. It’s a different story in Mexico, where rates are 6.5%, and in India, where they’re 4.4%.
So why are interest rates going up everywhere? Basically, restrictions eased and we all started buying more. But staff shortages (from illness and closed borders) have caused a shortage of stuff — and when there are fewer goods, they cost more. Ukraine and Russia’s conflict caused oil and gas to surge in cost too. All of this is causing inflation to soar the world over. One theory to control prices rising is to raise interest rates — when borrowing money is more expensive, we both borrow less and spend less. Credit card and mortgage repayments go up, but it’s good for any money you have in the bank because you earn more on it. That’s an incentive for us to all save. It sounds good in theory, but Crikey’s Bernard Keane and Glenn Dyer say it’ll hold back job growth and wage growth — and besides, many companies passing on higher prices are reporting massive profits, some in part because of taxpayer-funded JobKeeper, the pair add.
A SUB-OPTIMAL TIMELINE
Look — we probably won’t build nuclear submarines by 2038, Defence Minister Richard Marles says, as The Age reports. It was the audacious commitment of the Coalition government after our French exit from a $90 billion submarine deal that decimated our relationship with France (and was a major blow to its economy, as the Washington Post ($) reported). In his previous life in the portfolio, Opposition Leader Peter Dutton maintained we’d make the 2038 deadline, which is when our Collins-class submarines will be retired — but Marles says we’ll likely use a fleet of interim boats until the mid-2040s.
Marles also says the Labor government will be “speaking softly while carrying a big stick” — a Teddy Roosevelt reference — when it comes to China. It comes as China called us a “little bully”, The New Daily reports, after our Defence department slammed a “dangerous manoeuvre” and “safety threat” by a Chinese spy plane that came very close to one of our planes in late May. China’s state-affiliated media outlet The Global Times was like, stop exaggerating — it said we concealed “pivotal details” and were “loud and urgent but with little evidence”. Prime Minister Anthony Albanese was a bit worried, however, and said we’d spoken to China’s government about it.
JOHNSON AND FRIENDS
Overseas now and sound the leadership-spill klaxon — the fate of UK Prime Minister Boris Johnson is safe — for now — after he won a vote of no confidence. Conservative MPs overnight voted en masse on the no-confidence motion for Johnson’s leadership, as BBC reports, with the final tally being 211 to 148 (where the critics needed 180 to kick him to the curb). The fluffy-haired Tory has been fighting for his life after a string of scandals that showed alcohol-fuelled parties and gatherings at Number 10, while the rest of his country was languishing under lockdowns. The saga has been dubbed “Partygate” and The Guardian has an excellent timeline if you’d like to track the scandal — news.com.au says Johnson is actually the first serving UK prime minister to have broken the law.
Johnson is safe for a full 12 months now — but the discord in his party is palpable. Ex-cabinet member Jeremy Hunt, who lost to Johnson in the last leadership contest in 2019, has said he’d run again if Johnson was deposed. Hunt voted against him, and he’s not the only mutinous one — Scottish Tory Andrew Bowie, MP Laurence Robertson, and MP Dehenna Davison all revealed overnight they voted to dump Johnson. Sir Roger Gale, a long-standing critic of the prime minister, said he voted against Johnson for a few reasons — naming the time Johnson defended his then-aide Dominic Cummings for driving to County Durham during lockdown instead of asking him to apologise.
ON A LIGHTER NOTE
In the last couple of years a new meme has popped up — “taking a stupid walk for my stupid mental health”. It may sound a little bitter and twisted, but it’s more like a faux-begrudging acceptance that even a stroll around the block will usually boost one’s mood in some small way. And science agrees — researchers call this the feel-better effect, though it’s not limited to walks. A swim, some yoga, a bike ride, or even a good stretching session can improve one’s mood a little bit. One day, psychologist and exercise coach Kelly McGonigal got thinking about how this feel-better effect could be scaled. Research has shown several movements that both are inspired by, and can themselves create, joy — “imagine fans erupting when their team clinches a playoff spot”, she explains.
So McGonigal created the “joy workout” — it’s an eight-and-a-half minute, science-backed routine to make you feel good fast. McGonigal leads you through six so-called joy moves — like reach, sway, bounce, shake, jump for joy and one she named celebrate which “looks like tossing confetti in the air”, she says. There are no rules to this thing — go fast or slow, listen to her soundtrack or your own favourite music, repeat your favourite moves or invent your own, just do whatever feels good for you. “Consider this video as an experiment and an invitation to find your own joy of movement,” McGonigal says. Give it a shot if this sounds interesting to you — you deserve to feel good.
Hope your heart feels light and full this morning.
SAY WHAT?
I don’t think we should be afraid to talk about any technology that’s going to have the ability to reduce emissions and electricity prices. That’s something we can consider in time. I don’t think we should rule things out simply because it’s unfashionable to talk about them.
Peter Dutton
The Liberal leader has said he is “not afraid” to talk about “unfashionable” nuclear energy as an alternative to coal and gas. But Greenpeace says nuclear energy generates huge amounts of toxic radioactive waste while being very slow and expensive, while nuclear plants are dangerous and vulnerable.
CRIKEY RECAP
Many shine at the Bad-Take Brownlow, but Peter Hartcher takes the crown
“Both Terry McCrann and Gerard ‘Gollum’ Henderson went with innumerate and logic-chopped arguments that what matters in a preferential system is first-preference votes, and Jacqueline Maley faithfully reproduced the opposition’s pitch about The New Peter Dutton: that we don’t yet know him. (To paraphrase Jason Clare on Tim Wilson on election night, that we don’t like him is not because we don’t know him, it’s because we do.) And on the ABC, Stan Grant, bless, said teal supporters were just like Trump supporters, in that both were angry. Very Hegelian, Stan.
“But of course, the winner on points and on the red carpet has to be Peter Hartcher, who is not only a wonky vote counter and a poor analyst, but is happy to do such twice in two weeks. Readers of The Age/SMH were gobsmacked to see their senior political opinionista, in a piece denying the significance of the teal and Greens result, completely undercount their first preferences by comparing the 2022 running totals on the AEC website with the completed count from 2019.”
What tomorrow’s interest rate rise will do — and what it won’t
“The National Accounts’ GDP implicit price deflator increased 2.9%, the fastest rate since the March quarter of 1988 and a sign of just how embedded cost pressures are now in the wider economy. The ABS pointed out that as a key part of that deflator, the domestic final demand implicit price deflator rose 1.4%, which was the strongest growth since the introduction of the Goods and Services Tax in 2000.
“But the main inflation narrative centres on energy prices and supply chain problems here and overseas, and the Reserve Bank could send us into a deep recession with precisely zero effect on that. Raising rates won’t change Xi Jinping’s zero-COVID mentality and his willingness to shut down large parts of the world’s second-largest economy; it won’t produce microchips or more new cars faster; it won’t compel Russia to withdraw from Ukraine. And it won’t push energy prices down, nor enable us to go back in time and prevent the climate wars from preventing a much more rapid decarbonisation of our energy system.”
Suddenly united, France’s left threatens Macron’s dominance — Anthony Albanese should take notice
“If you think Australia’s Labor and Liberals have a hard time with the slow collapse of the two-party system, spare a thought for reelected French President Emmanuel Macron, now confronting a far more uncertain outcome in the country’s parliamentary elections this month. Polls are hinting that a surprisingly united socialist and green coalition — the New Ecological and Social Popular Union (NUPES) — could grab a majority in the assembly, or at least deny Macron’s centrist coalition control of the Parliament.
“It’s offering a real-life example of the global left’s argument that economics — abandoning neo-liberalism — can trump working-class support for hard-right populism. The result? Jean–Luc Mélenchon (think France’s Bernie Sanders) could break through as prime minister for Macron’s second presidential term, with his promise to attack inequality with a wealth tax and more progressive property tax.”
THE COMMENTARIAT
Federal anti-corruption body will manacle political vision — Barnaby Joyce (The Age): “Government ministers have — and must have — the discretion to step outside bureaucratic recommendations and make decisions based on a vision for a greater Australia. It might be a decision based on their political views, or on their compassion, and it might not subscribe to the purity of a business case.
“If a politician like Ted Lindsay had been forced to go before an ‘integrity commission’ to justify decisions to invest in the areas he represented, such as the building of Burdekin Falls Dam, might he have been deemed ‘corrupt’. That would have been a travesty. Seed infrastructure that has developed the north of Australia would not have passed a Canberra business case, but it was a political vision that had it built. And the people came, and subsequent analysis showed the decisions were worthy. This is the vision of elected representatives, and that should not be usurped by another pillar of bureaucracy such as the proposed commission.”
Albanese right to place highest priority on Indonesia — Greg Sheridan (The Australian) ($): “Jokowi is an enigmatic, elusive, often difficult leader, especially for international interlocutors. It’s not that he is disagreeable or instinctively opposed to good ideas. It’s rather that, somewhat like the character Tom Bombadil in The Lord of the Rings, his mind just travels down different paths. His imagination is captured by odd bits of technology. Like many Indonesian leaders, like most Indonesians, he is focused on the internal politics and dynamics of his vast, complex nation.
“His record as president is mixed — mediocre economic reform, episodic attachment to democracy, episodic lack of commitment to civil liberties, generally popular, religiously and socially moderate, and remarkably successful politically. It’s not up to any visiting Australian to contest any of that because, while we have an overwhelming interest in broad Indonesian success, most of those issues are, broadly, none of our business.”
READ ALL ABOUT IT
Qatar, other Muslim nations condemn India over anti-Islam remarks (Al Jazeera)
Russia seeks buyers for plundered Ukraine grain, US warns (The New York Times)
Israel’s fragile ruling coalition to vote on Israeli settler law (Al Jazeera)
Platinum Jubilee: Six of the best royal moments (BBC)
Almost a quarter of Canadians report eating less than they should due to rising prices: survey (CBC)
Elon Musk threatens to end Twitter deal over lack of information on spam accounts (The Wall Street Journal) ($)
Apple unveils iOS 16 with revamped lock screen and big changes to iMessage (CNN)
Pope Francis’s latest plans fuel rumours over resignation (The Guardian)
Is criticism of [NZ] PM’s US trip fair – or just Tall Poppy Syndrome? (NZ Herald)
HOLD THE FRONT PAGE
WHAT’S ON TODAY
Kulin Nation Country (also known as Melbourne)
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Former ambassador and diplomat Kevin Magee, La Trobe University’s Nick Bisley, La Trobe Asia’s Kate Clayton, and University of Melbourne’s Dan Hu will be in a panel discussion about how Labor could re-evaluate our relationship with China.
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Zoos Victoria’s Jenny Gray, Ecosystem and Forest Sciences’ Brendan Wintle, and Conservation Ecology Centre’s Jack Pascoe will speak on a panel about what we risk if we continue to lose biodiversity.
Yuggera Country (also known as Brisbane)
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ABC’s Paul Barclay is in conversation with Alicia Cameron discussing her book, Building an Innovation Hotspot, at Avid Reader bookshop. You can also catch this one online.
