By Andrew Klein

Dedicated to the workers of the world — the ones who still earn a salary, and who may have forgotten that a salary was once a payment in salt, the substance that preserves life.

I. Introduction: A Dinner of Indifference

On 2 May 2026, the Reserve Bank of Australia raised the cash rate for the 11th time. Hours later, it spent nearly $25,000 of taxpayers’ money on an exclusive dinner for Perth’s business elite. The menu featured grilled barramundi, risotto, and lemon tart. The drinks tab was $4,331.

The very next day, RBA Governor Philip Lowe told struggling Australians to “work more and spend less”.

This is not leadership. This is not competence. This is a mockery — a symbol of an economic system that has lost its way, its purpose, and its moral compass.

II. The Unravelling of a Failed Doctrine

A. The RBA’s Record of Failure

Australia now has the second-highest inflation rate among all advanced economies. Leading economist Warren Hogan has declared that the RBA “failed” to get inflation under control, calling last year’s interest rate cuts a “mistake”. The central bank has been forced to hike rates three times in 2026 alone, undoing the cuts of 2025.

The RBA’s policy is deliberately designed to create unemployment. It operates on a concept only an economist could love: the Non-Accelerating Inflation Rate of Unemployment (NAIRU) — a theoretical construct that no one can directly observe. As journalist Ross Gittins has observed, NAIRU models have consistently been set too high, leading policymakers to accept more unemployment than was necessary.

The Reserve Bank has a dual mandate: price stability and full employment. But it has made clear which takes priority. As Governor Michele Bullock has put it, low inflation is “a prerequisite” for employment growth — so when the two objectives conflict, unemployment comes second.

B. A Blunt Tool for a Complex World

The RBA has just one policy tool: the setting of official interest rates. But the world has changed. The post-war baby boomers are in retirement, with very high levels of home ownership, making their spending patterns immune to interest rate changes. The RBA’s main policy tool is no longer fit for purpose.

As one critic noted: “What the RBA has failed to grasp is that because petrol is a highly non-discretionary item, increased petrol prices due to international factors will cause people to have to cut back spending elsewhere“. The RBA is raising rates to fight inflation driven by global oil price shocks — nothing the RBA does will affect that.

It is punishing ordinary Australians for problems it cannot solve.

III. The Ideology Behind the Failure

A. Neoliberalism in Crisis

The failure of the RBA is not an isolated technical error. It is the predictable outcome of a broader ideological project: neoliberalism.

Neoliberalism promised that freeing markets would deliver productivity, innovation and prosperity. Instead, capital flowed into speculation and property bubbles. Inequality of income and wealth has been rising; a majority of workers have experienced long-term declining relative living standards; corporate political and market power has reached historic levels.

As the Guardian has noted, “failure to address underlying inequality eventually opens the door to movements that scapegoat minorities, immigrants and institutions while further slashing taxes for the rich“.

B. The Architecture of Exploitation

The current system is not broken — it is working exactly as designed.

Central bank independence has entrenched an unaccountable system that prioritises financial sector gains while driving unemployment and eroding real wages. Average annual real wage growth has trended downward over the past 20 years. Over the last ten years, the average annual wage increase has been below the average annual increase in the CPI.

Workers are not being paid what they are worth. They are being paid what the system can extract.

IV. The Forgotten Meaning of “Salary”

The word salary derives from the Latin salarium — a payment made in salt. In ancient Rome, soldiers were paid in salt, the substance that preserved food and sustained life. The expression “to be worth your salt” comes from this tradition.

A salary was once a recognition of value: the acknowledgement that a worker’s labour was essential to the survival of the community.

Today, a salary is often a minimum — the least a worker can be paid to survive. The connection between labour and value has been severed. The worker is no longer valued for what they contribute; they are valued only for what they cost.

This is not progress. This is regression.

V. The Acceptable Paradigm: A New Economic Vision

The current paradigm has failed. What must replace it?

A. Functional Finance Over Monetary Restriction

The RBA’s obsession with inflation targeting has blinded it to the real economy. As one critic notes: “Neoclassical monetary policy does not just fail to reduce inequality; it is structurally designed to increase it”.

A better approach is functional finance — the idea that the government should use its fiscal power to achieve full employment and price stability, rather than relying on a single blunt tool that punishes the most vulnerable.

B. The Dual Mandate, Taken Seriously

The RBA has a dual mandate: price stability and full employment. It has prioritised the former. It must prioritise both.

As one analysis puts it, “the path beyond capitalism lies in creating a socio-economic architecture that treats the economy as a realm of conscious, democratic coordination rather than an autonomous, quasi-natural force”.

C. Community Wealth-Building Over Corporate Extraction

The alternative already exists. As Katherine Gibson has argued, it is becoming increasingly urgent to make visible alternative ways of living and doing business based on care and community.

Post-capitalism is not a distant future. It is a present in which economies are already more than capitalist. Alternative economic forms — cooperatives, community-based organisations, commons-based production — are already taking root.

D. The Recovery of Worker Dignity

The new paradigm must restore the connection between labour and value. Workers must be paid a salary that reflects their worth — a salary that is truly salarium: the substance that preserves life.

This requires:

1. Full employment as a policy goal, not a side-effect.

2. Real wage growth that keeps pace with productivity.

3. Accountable institutions that serve the public, not the financial sector.

4. Democratic coordination of the economy, not rule by unaccountable technocrats.

VI. Conclusion: The Salt of the Earth

The $25,000 dinner in Perth was not an aberration. It was a symbol — of a system that serves the few while punishing the many. Of a theory that has failed and an ideology that has been exposed.

But systems can be changed. Theories can be replaced. Ideologies can be abandoned.

The workers of the world — the ones who still earn a salary — are the salt of the earth. They preserve life. They build communities. They create value.

It is time they were paid what they are worth.

Andrew Klein

The Patrician’s Watch | Australian Independent Media

References

1. RBA spent $25,000 on exclusive Perth dinner hours after raising rates. The West Australian, 2026.

2. ‘The RBA failed’: Major call as Australia’s inflation problem exposed. Sky News, 6 July 2026.

3. Raising rates while petrol prices soar shows the RBA ignoring reality. The Point, 17 March 2026.

4. The failure of Reserve Bank independence. Independent Australia, 2026.

5. The RBA’s policy deliberately creates unemployment. The Conversation, 2026.

6. As the population ages, the RBA’s interest rate policy is no longer fit for purpose. The Conversation, 2025.

7. Why the RBA has been so chill about putting jobs on the line. Bill Mitchell, 2026.

8. Neoliberalism in crisis: inequality and declining living standards. Various sources.

9. Post-capitalist community economies. Katherine Gibson, 2025.

10. Etymology of “salary”. Online Etymology Dictionary.