Exactly fifty years ago the Australian government held a different referendum.
That time, in 1973, the Whitlam government held a referendum giving the Federal Parliament the power to control prices in order to tackle runaway inflation that was driving up the cost-of-living.
Up until then, price controls had been used exclusively by the states following World War 2 to prevent undue price increases on food, clothing and housing in the period of postwar readjustment. Basic foods like eggs, bread and milk were subject to control depending upon the individual state, with state prices ministers meeting regularly to coordinate controls.
That referendum was ultimately defeated, and the power to control prices remained with the states, rendering the Whitlam government unable to effectively deal with the ‘stagflation’ crisis of the 1970’s.
In the 1980’s there was a concerted effort by the Cain Labor government to tackle excessive price rises.
The government set a target ceiling on grocery price rises backed up by legislation which allowed the Prices Minister to set prices on declared grocery items. This legislation was credited with Melbourne going from having the highest price increases in the country to some of the lowest in the space of 12 months.
The then government also created an ‘Office of Prices’ within the department of Consumer Affairs with the express objective of deterring excessive price rises through price monitoring and price investigations.
Today, governments have discontinued efforts to prevent unfair price rises profiteering despite having the power and responsibility to do so.
Half a century after Whitlam’s price controls referendum, with profit-led inflation and ‘greedflation’, there is a compelling case for the re-introduction of price controls to lower inflation and tackle the cost-of-living crisis.
Profiteering from greedy corporations is fueling inflation and adding to the cost-of-living crisis where people are struggling to afford food, pay the bills or pay the rent.
The supermarket duopoly is a case in point.
As Coles and Woolworths post billion dollar plus profits and increased profit margins, whilst people take to social media to share their outrage at the supermarkets’ price hikes on basic foodstuffs like cheese, and lampoon Coles’ ‘Feed your family of four for $10 campaign’ from just 6 years ago.
With rents continuing to skyrocket, energy prices climb and with food prices set to stay high, the cost-of-living crisis is causing profound harm right across our community.
Increased stress, anxiety and worry, being unable to afford to visit family or friends, and significant hardship are all too common themes. People are putting off healthcare because they can’t afford it and are having to choose between putting food on the table or paying the bills.
It is imperative that governments take direct action to stop price gouging and lower costs of essentials for everyone. Without it prices will continue to go up and stay up.
Around the world governments are taking a range of such actions to force supermarkets to lower prices including putting price caps on essentials, limiting retailer’s profits or even simply using the threat of price controls to force supermarkets to bring down prices.
In Spain inflation is at just 2% because its left-wing coalition government has capped energy prices, controlled rents, lowered the cost of food staples and taxed excess profits.
Yet in Australia, despite state governments having the power to stop supermarkets from ripping people off, they’re refusing to use it. Instead they’re stuck in a neo-liberal policy straightjacket that’s allowing them to get away with it.
Gough Whitlam said in 1973 “Controls over prices are not a cure-all for inflation, but they can be used selectively as one of the elements in anti-inflationary strategy.”
With profiteering, price gouging and unfair price hikes driving up the cost-of-living today, price controls may be even more necessary than they were 50 years ago.
