Wayne Swan frustrates me

I know he's trying as the new treasurer, but he sounds like a broken record with his "banks who raise interest rates above the RBA rate will be punished/mortgagers will be able to switch banks more easily."

Do you really think many people can just switch their hundreds of thousands in loans just at the drop of a hat? Do you think that banks won't impose penalties for rescinding the contract early? And most of all, I think the saying "the lesser of two evils" encapsulates best what I'm about to say, if all the banks are bumping up their rates, who are the poor families going to switch to???

Really Wayne, I mean c'mon, that's just empty rhetoric.

I'm mindful of not bagging the banks either. I understand they have a higher cost of capital now due to the sub-prime crisis, and I understand (at the risk of sounding like a fat capitalist) that they need to deliver profits to their shareholders, which explains (nb. not necessarily justifies) the higher interest rates.

I'm still of the notion that raising interest rates is not the best way to tackle inflation. Raising interest rates means higher repayments for people who've borrowed to buy property (the majority) which means higher rent, which comes back again to increase inflation - the very thing we're trying to decrease! On that note, even though I have investment property, the Government would do well to drastically increase the supply of housing as the reason why we have such high rents is because there is a MASSIVE under-supply. All the strugglers out there renting are having a really tough time.

I suggest less tax cuts. A lot of the concessions are to wealthy investors or business owners - important to the vote and hence who the politicians can't afford to piss off. It's seen as a "no-go" for the Rudd government because if he goes back on the promises he made during the election, he will be flayed. But by reducing tax concessions, this means the money goes back to the Government and they can sit tight on it until inflation comes down to an acceptable level, without having the effects of increasing rents does - higher inflation and angry strugglers.