Inequality is back at the heart of politics
As 2025 draws to a close, we can look back on a year when economic inequality became firmly entrenched on the Australian political agenda, he writes Carl Rhodes.
WHEN THE YEAR STARTS, surveys It was already showing that the cost of living was the number one issue for Australian voters. No surprise there. Inflation had so eroded the spending power of ordinary Australians that income inequality had reached a 20-year high. high.
When the federal election campaign began, it was a continuous three-year stretch. price increasesEverything from shelter and food to electricity and medical services had been bitten hard.
The Prime Minister called for elections on 28 March. Anthony Albanese declared:
“Only Labor is driven by the cost of living.”
The truth is still naked. Poverty rates climbed increased to 14.2%. The number of Australian billionaires has doubled in a decade.
Headlines talked about the crisis:
ABC’s title:
‘Australia faces cost of living nightmare’
The Guardian title:
‘We need leaders brave enough to fight inequality for everyone’
Sky News title:
‘Cost of living will leave one in five Australians without food for Christmas’
By August, when the federal government convened the Economic Reform Roundtable, intergenerational inequality had risen to the top of the agenda. Inequality, once shorthand for poverty, has become the lived reality of central Australia in 2025.
Big Business joins the debate
If evidence was still needed that inequality has gone mainstream, it emerged earlier this month. Australian Financial Review announced its annual results Chanticleer survey. More than 50 of Australia’s best corporate companies leaders focused on how to tackle intergenerational inequality; This was a striking departure from the growth-at-all-costs rhetoric.
Commonwealth Bank (CBA) chief executive Matt Comyn clarified the issue, echoing the bank’s previous approach surrender To the Economic Reform Roundtable:
‘The compact center of Australian life is being eroded.’
long time promise “By working hard and contributing to Australia today, people will be better off tomorrow, paving the way for a brighter future for future generations.” is slipping away.
AMP CEO AlexisGeorge He argued that inequality erodes social harmony. SGH chef Ryan Stokes He insisted that a reasonable cost of living should be a reality, not a dream “desire that grows more distant every year.”
Practical ideas emerged. Housing affordability took hold, with proposals to reduce taxes on new homes, increase efficiency on construction sites and encourage living outside major cities. Others have pressed for shifting the tax base from personal income to consumption, strengthening retirement planning and increasing skills and education.
The elephant in the room: Redistribution
The fact that Australia’s corporate elite are now discussing inequality marks a profound and welcome change. But let’s be clear, one glaring omission stands out AFR’Commentary on Chanticleer survey.
Decades of tax and fee policies have created an Australia in which an increasing share of wealth is concentrated in the hands of a few at the expense of working people. However, corporate recommendations AFR There was barely a whisper about raising wages or taxing wealth as part of the solution.
World Inequality Lab 2026 World Inequality Reportpublished just two days ago AFR‘s coverage hit home at this point. The report, based on research by more than 200 scientists, paints a sobering picture: Global wealth is growing, but it is hoarded by a small number of people.
of Australia story no less sharp. The 20th century was defined by progress towards economic equality. The top 10%’s share of income fell from about 50% in 1900 to 25% in the late 1970s. The tide has turned since then. Today the top 10% own 35.2% of all income and a staggering 57.3% of all wealth.
Professor Thomas PikettyCo-author of the report, dull:
‘We need to change the rules. ‘You should put limits on how much private individuals can save.’
His solution focuses on progressive taxation, including annual wealth taxes on those with extreme wealth.
It’s time for bold action
Matt Comyn He was right: Australia’s long-established social contract that hard work will lead to a better future is breaking down.
The CBA chief was also right when he said:
“…the new generation may be the first in modern history to be worse off financially in Australia than their parents.”
In an unexpected move from the business world, CBA is now on record: “The next wave of the tax reform debate…must include the appropriate levels and role for wealth taxes.” The job now is to make this happen, but so far little progress has been made.
The World Inequality Report makes the point clearly. We are past the point where skills development or productivity adjustments will make a big difference. Tackling this crisis requires the kind of bold structural reforms that corporate Australia has spent in the past to defeat lobbying dollars.
This shift requires rewriting the rules of economics to place strict limits on private accumulation and place aggressive redistribution at the center of fiscal policy.
It can be easy for CEOs and politicians to lament the loss of social cohesion from the comfort of an AFR poll or parliamentary chamber. It’s much harder for them to support the higher corporate taxes, wealth taxes, and wage increases needed to fix this. If elites are serious about preserving the social contract, they should stop defining the problem and start paying for the solution.
Carl Rhodes is Professor of Business and Society at the University of Technology Sydney. Wrote several books On the relationship between liberal democracy and contemporary capitalism. You can follow him on X/Twitter @ProfCarlRhodes.
