The Melbourne Cup is Australia’s version of the Kentucky Derby, The Epsom Derby, and Prix de l’Arc de Triomphe a couple of times. It’s a national celebration of buffoonery, alcohol abuse, and questionable fashion choices. Oh, and gambling.
The first time I attended was when I was nineteen and worked the bar in corporate marquees. As a hospitality job, it was relatively well paid due to the public holiday penalty rates and I had the unique experience of being the only sober person out of 80,000 race goers. I was living in St Kilda with a girl that loved heroin and Nick Cave who came from a family beset by misfortune in all its malicious forms. Working was a foreign concept at the time for the young. In the early to mid 1990s it was possible to be on the dole, rent an apartment, work some cash jobs and live a reasonable but indolent lifestyle.
The second time I went to ‘the cup’ was with my new girlfriend and her family as a guest. I was newly in love so we dressed up had some Bolivian matching powder and spent the day drinking champagne in a marquee. It was hot and dusty and like most ‘national’ days the fun felt forced. I was in my belligerent drinking phase and remember standing in front of the screen during the big race at 15:20 to cries of “sit down”, “move”, “get out of the fucken way”.
I didn’t pick a winner on the cup on either occasion. Gambling is not being my thing. Thank god.
The thing about Melbourne Cup day is that being held on the first Tuesday of November, it coincides with the announcement from the Reserve Bank of Australia (RBA) about interest rates. It’s a beautiful symbiosis of Australia’s national passions: gambling and property prices.
Technically, the RBA reviews monetary conditions, inflation, and economic activity, and unemployment to consider what the cash rate for lending and deposits should be. According to the bank, they “work to support the stability of the currency, full employment, and the economic prosperity and welfare of the people of Australia.”
In these post-Covid times the trajectory of interest rates has been up with the bank increasing rates to combat the impact of inflation caused by rising prices, quantitative easing, and energy costs. The November 2023 announcement from the RBA talks about the concerns around inflation, household demand, and wages growth. there is some mention of the negative impact of a slowing economy but the bank is focused on inflation by smacking consumers with higher interest rates.
It’s the shit fuckery of the modern economy, bait consumers with over-priced houses and then smack them down with higher costs. Jim Stanford writes in The Conversation that “in the three years since December 2019, corporate gross operating profits have risen 43.6% – more than twice the growth in wages.” There is a massive redistribution of wealth from labour to capital with higher corporate profits driving inflation and reducing the purchasing power of wages. With only the interest rate lever, the RBA keeps hammering down the workers while looking the other way as corporate profits continue to grow.
The shit fuckery of late capitalism is that Australian consumers are blamed for an over-heated economy, workers are hammered on the importance of productivity gains if there are to be wage increases, and behind the scenes corporate profits, petrol prices, energy costs are responsible for the greatest decrease in household gross disposable income in the OECD.
Marx had late capitalism right when he described the concentration of capital in the hands of the few and a depletion of labour. In Australia, we’re living it.
Things need to change.