The return of inflation may poison Labor’s second-term agenda and scare more voters to the fringes

The Australian treasurer, Jim Chalmers, had pivoted to a more forward-looking economic agenda, but now he is now fielding questions about whether high government spending is to blame for inflation and rising prices, writes Patrick Commins. Photograph: Darren England/AAP

Cost of living has been bubbling along as the number-one issue for Australian households, and now it threatens to hijack the Albanese government’s second-term agenda.

The return of high and rising inflation is not only a blow to workers who were finally starting to see some real growth in their wages through 2025. It also risks further polarising and antagonising our already fraught politics.