Impressive. That’s how Jean-Claude Trichet, President of the European Central Bank, described the world’s economic performance earlier this week. We continue to have encouraging indications for global growth, which is an exceptional period of several years with very, very dynamic growth,” Trichet said.

However, according to Trichet, it’s not all roses and sunshine: “This doesn’t call for complacency – we see risks that must be taken into account if we want this growth to last. We have certainly the risk that inflation could create an environment that would not permit sustainable growth.”

So it should be no surprise that a statement was released shortly after the completion of the G20 summit warning of future interest rises across several countries to contain inflationary pressures.

Maybe if those in the know at the RBA had of heeded Henry’s advice of a pre-emptive 50 basis point rise in early November (instead of the 25 basis point rise), the likelihood of interest rate hikes in the lead-up to next year’s Federal election would have been severely diminished – helping not only home buyers, but also the government’s chances of re-election.

However, Federal Labor, Bomber Beazley specifically, has failed to capitalise on the recent interest rate rises. The Oz explains it quite succinctly: “The day after the Melbourne Cup… the Reserve Bank put up interest rates for the fourth time since the 2004 election and delivered the ‘silver bullet’ for Kim Beazley to beat John Howard next year. The Howard Government’s broken covenant with the Australian people on interest rates was meant to deliver Labor an election-winning boost. While the fortunes of the ALP did change, however, it wasn’t for the better. In the 16 days since, federal Labor’s hopes have been dented and its plans have unravelled.”

Many commentators, Henry included, have been hard on the ALP and Bomber in particular for not making a better fist of things in the past, and we repeat the mantra, more in sorrow than in anger that the punters deserve a more robust effort around the country from the shadow benches to raise the level of debate and – dare we say it – keep the b-stards honest.

Henry sincerely hopes that Santa takes care of Bomber this Christmas, if only so there can be a decent showing at next year’s election. The issue of course extends beyond the Commonwealth to the States, where we are pleased to see a stronger showing in Victoria by an increasingly better organised and well-drilled opposition (this from a pretty low base, but any progress is most welcome).

Read more at Henry Thornton.

Peter Fray

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Peter Fray
Editor-in-chief of Crikey