Australia shuns the world

Editorial, Normal

The National – Friday, December 17, 2010

AUSTRALIA is turning its back on the world.
Not only is it seeking to put up barriers against people moving to the country, but it is also now looking decidedly protectionist and xenophobic about Chinese investment in particular.
It is not only the Greens who are peddling this recipe for economic disaster, but elements of the major parties, even the supposedly free market-oriented Liberal Party.
Let us set out what is at stake here.
Since Paul Keating became treasurer in 1983, and there emerged a bipartisan political consensus about the need to reduce trade barriers and liberalise the domestic economy, Australians have experienced strong economic growth.
The recession of the early 1990s was the only blip on the screen.
John Edwards, a Keating biographer and economist, has argued that the reason Australia has experienced strong economic growth since 1991 is because “tariff cuts and the float of the currency and banking deregulation in the 1980s opened new opportunities at the same time as they sharply increased competition in the Australian economy”.
The other driver of growth was the switch from wage arbitration to enterprise bargaining at the beginning of the 1990s “allowed the redeployment of labour just as cheap new technologies in communications and information technology were offering the opportunities to reorganise production, distribution and exchange”.
And now the major factor driving economic growth in Australia is globalisation, says Edwards.
“Australia’s increasing participation in the global economy, itself driven by powerful and long-term forces, is now helping to sustain a robust expansion of indefinite duration,” Edwards argues in a 2006 paper published by the Lowy Institute, a think tank.
But politicians with wrecking balls in their hands are threatening Australia’s open and liberal economic outlook.
The Greens are at the forefront of this counter-revolution.
Greens leader Bob Brown is an old-style economic nationalist.
He lines up with former One Nation leader and fish and chips shop operator Pauline Hanson, National Party leader Barnaby Joyce and independent MP Bob Katter on the issue.
Brown, who quit the National Party in 2001, recently made a song and dance about a possible takeover of the Australian Securities Exchange by its Singapore counterpart.
“We don’t see an advantage for this nation in having that stock exchange being controlled from Singapore, particularly where there is such a big controlling – and I use the word ‘controlling’ outside the number of shares – interest from the Singaporean authorities,” he said on Oct 26.
The Greens’ policy is to “reduce Australia’s foreign debt and foreign ownership through use of trade, financial and regulatory measures to ensure more productive use of foreign capital and strengthening of Australian manufacturing, recognising the need to support economies in developing countries”.
In other words, the Greens want to go back to the dark days when governments protected industries from foreign competition or foreign capital. – onlineopinion.



*Greg Barns is a former state and federal government adviser and a Hobart-based author. He is a former adviser to New South Wales premier Nick Greiner and federal finance minister John Fahey. He is a director of Republic Gold Ltd, an ASX listed company developing a gold mining project in Bolivia