One Nation is capitalising on Australians’ economic pessimism like never before. Is a ‘stagflation impulse’ to blame?

One Nation’s surge in popularity will be tested in earnest at the next federal election. Photograph: Lukas Coch/AAP View image in fullscreen One Nation’s surge in popularity will be tested in earnest at the next federal election. Photograph: Lukas Coch/AAP Analysis One Nation is capitalising on Australians’ economic pessimism like never before. Is a ‘stagflation impulse’ to blame? Jonathan Barrett By tying housing costs to immigration, Pauline Hanson promises a simple solution to a multilayered problem Get our breaking news email , free app or daily news podcast In the three decades since Pauline Hanson entered federal politics, Australia has experienced numerous bouts of voter frustration with the mainstream parties. But it is only lately that the negative sentiment towards the majors has propelled One Nation to unprecedented polling numbers and delivered Hanson higher net approval ratings than the prime minister and opposition leader. Why now, and what happens next? Cost-of-living squeeze Households are experiencing economic pressures that resemble the unrest of the 1970s , a period marked by elevated inflation and a stagnant economy. Households feel this “stagflation impulse”, as some economists describe it, through a cost-of-living squeeze accompanied by fear for their financial future, which often includes job insecurity. A winter of discontent has been intensified by Australia’s notoriously high housing costs and the frustration felt by younger generations at being priced out of home ownership. This despair is evident in consumer sentiment surveys that show Australians are now experiencing “deep pessimism”, according to the Westpac-Melbourne Institute, with interest rate hikes also weighing on prospective buyers and mortgage holders. Graph showing the consumer sentiment index While these factors have created fertile ground for populist parties, it is not the first time Australians have felt under financial strain. The difference this time, according to Jordan McSwiney, a researcher who has examined far-right movements, is that One Nation has been able to tie housing affordability concerns and other economic ailments to immigration. “Economic policy and housing are not really territories that One Nation is usually comfortable on,” says McSwiney, a research fellow at the University of Canberra’s centre for deliberative democracy. Sign up for the Breaking News Australia email “This kind of link between immigration and housing allows them to address issues that are very front of mind to people, like the economy, but address it from their preferred terrain. “One Nation is doing a bit of a bait and switch, in that they use the context of housing and the economy to talk about what they really want to talk about, which is immigration.” The party also links cost-of-living pressures to its campaign against net zero emissions and renewables, which provides another well-established talking point for Hanson. Sequence of shocks The causes of Australia’s