Did Business Owners Just Get Screwed? Election Results Special

EP 023: The Labor government has won.

It appears they are about to shake things up by bringing in a heap of new policies and changing some older ones.

But…What does this mean for business owners?

Are we all about to get screwed by rising wages and unions?

…I doubt it.

In fact, this looks like the most pro-business Labor government ever.

(To my surprise and delight.)

Time will tell.

In this week’s episode:
○ Labor wants to own 40% of your house
○ Labor’s plan to secure jobs and… raise wages
○ The plan to fix the NBN and finally have good internet
○ Who is paying for all this government spending?

Prefer to listen or watch?

You can hear Grant and I discuss these topics in more detail on the podcast
Click here to tune in: https://linktr.ee/businessandinvestingcom

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WHAT HAPPENED

Labor wants to own 40% of your house… Well, kind of.

In summary:

Labor will be helping 10,000 1st home buyers get into the market via an equity scheme.

How does it work?

I’ll use an example to lay it out simply.
(Noting there are a bunch of terms and conditions.)

A 1st home buyer buys a house for $100k.

The 1st home buyer would put in $60k.
The Government would put in $40k.

If the house doubled in value and was sold for $200k.

1st home buyer would get $120k.
Government would get $80k.

Yep… The government is investing in housing and potentially making a profit from it.
I guess this makes them the next Black Rock or Vanguard?

It seems to be positioned as helping 1st home buyers.
I’m not so convinced…

In my opinion, this will likely be a huge driver of revenue for the Government in the coming years.

Why is this important to Australian business owners?

If you work in or support the construction industry you should be celebrating right now, as I think this is a massive tailwind for the industry.

Plenty of work coming!

It will also likely keep our property market incredibly strong.
Especially in the major regions that support our capital cities.

Though not so great for affordability…

As a property investor myself, I do see this as the Government propping up the property market once again.

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WHAT HAPPENED

Labor’s plan to secure jobs and… raise wages

In summary:

It wouldn't be a Labor government if “Labor” didn’t get some wins out of this right?

Some key points on this one:
○ Wages will go up with the desire of matching inflation
○ Universities - 20,000 additional places:
“priority areas like clean energy, advanced manufacturing, health and education"

Why is this important to Australian business owners?

I’m not going to dance around this one.
Your costs to employ staff are going to go up.

Now more than ever you need to make sure you are being efficient with how you use your team.

Having a bloated team size or using staff on low-level tasks that could be done by software or remotely could be your undoing.

Businesses who focus on innovating their business model to adapt to new technology will thrive in the coming years.

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WHAT HAPPENED

Will Australia finally have good internet? Fixing the NBN

In summary:

Labor has made a big pledge to “fix” and “improve” the NBN.

Australia is currently 59th in the world on average broadband speeds.
Which is appalling considering how reliant on it we all are.

Under this plan, 10m premises will have gigabit speeds by 2025.

With a big push once again in the regional areas.
(You might be noticing a theme here with the regional areas.)

Why is this important to Australian business owners?

This is huge for business owners.
Faster more reliable internet improves productivity and enables innovation.

This will also enable more Australians to work from home or operate in virtual companies.

It's time to start thinking creatively about how we can take more of our businesses online.

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WHAT HAPPENED

Who is paying for all of this government spending?

In summary:

We don’t get all of this for free.
At the end of the day, the citizens of the country pay for all of these government projects.

But… how we pay for it is different today than generations ago.

Once upon a time, governments would get funding from the taxes we pay.
However, today that isn't possible.

As our governments spend more money than they collect from taxes.

Instead, they print money and use debt to fund things.

YES, they are spending more money than they earn…
Which is dangerous.

It does mean we are passing on today's spending to future generations.
But with a twist.

Governments are using the power of inflation to inflate away the debt.

If you want to go deep on the topic of inflation I would suggest you listen to the episode of the podcast we did on the topic:

The Lies About Inflation and How It Impacts Your Life

Why is this important to Australian business owners?

This is important for 2 reasons.
1) If governments continue to spend more than they earn, then inflation will remain in our economy.

I think it’s VERY important for business owners to have a strategy in place to deal with the rising costs of goods and services.

2) You “might” want to take a leaf out of the government's book and use the power of inflation for yourself and your wealth building decisions.

This is once again one of the reasons I personally put an emphasis on property.
(I repeat, this is my opinion and NOT financial advice.)

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UPCOMING

Be on the lookout…

And, If you want to hear us unpack these topics before anybody else does…

Then make sure you are subscribed to the podcast: https://linktr.ee/businessandinvestingcom


Episode Highlights:
00:00 Introduction
03:14 The government owns 40% of your home
14:11 Would Grant and Charley take on the equity scheme?
18:49 Will wages go up under a Labor government?
31:05 Labor’s plan to fix the NBN
42:27 Who really pays for all this government spending?
52:10 Moving forward post-election as business owners

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