The Stupid Economy

When companies come begging for money with a very good case and much at stake the dilemna is obvious. Opinions are quickly divided over whether ideology should trump idealism.

But the real issue that is forgotten is the economic conditions and policies that have led us to the point where producing everyday staples like cars and canned fruit are no longer possible in this country. When this government was elected it boasted that Australia was now open for business, based on the idea that they would sit back and not interfere, yet if sitting back and letting the world economy overpower our domestic manufacturers is the intention, it would seem that open for business is a complete oxymoron.

Ideology dictates that we need to be more competitive, we must somehow produce more per dollar input than we have up till now, but unless our workers can up their speed or farmers increase their yields, the only other way this can be achieved is through lower wages, lower prices to farmers or unsustainable farming methods. It is quite possible we are running very close to maximum efficiency and we don't really want to introduce undesirable conditions on workers nor punish the environment. Ideology then demands that if we cannot compete in one area of the economy, then we give up and concentrate on what we are good at. What Australia is good at through the good fortune of being on an ancient craton is producing minerals. We cannot necessarily produce it the cheapest, but cheap enough and in large enough quantities due to the fact that the costs of wages are not a major factor overall in the extraction of minerals. This is the problem then in relying on mining as it cannot by its nature distribute wealth very efficiently because it employs low numbers. If Australia is to rely on mining to continue the dream of high standards of living, then the proceeds need to be taxed and handed out as social welfare. This is not an ideal situation except to the people our society tends to demonised the most - the 'dole-bludgers'.

For an economy to work for the population it should provide opportunities for its citizens to contribute, and jobs are the simplest way to allow citizens to contribute. Jobs need to be meaningful, giving the worker a sense of pride in their work, and opportunities needs to exist to tailor for the range of abilities, personalities, social situations and desires of its citizens. A robust healthy economy is stable and diverse both culturally and productively. It distributes wealth accordingly to the input and risks its citizens are prepared to pay, it rewards hard work with both fincancial and emotional rewards, and opportunities for all to flourish no matter what skills or values its citizens possess. It is obvious that the current ideology of our government and predecessors is not serving us to create such an economy. We are heading towards an economy where only a few low labour intensive industries flourish, where the remainder of us either survive off welfare or take up jobs as salespeople, selling stuff we did not make. There will always be some jobs that cannot be replaced by cheaper overseas labour, however technology and greed will always combine to find ways to take advantage of low-wage conditions in other countries. There are very few economic opportunities to contribute to societies needs that are not threatened by a cheaper option off-shore. If all our industries become un-competitive then our dollar should drop until they can compete again - that is the theory our governments have relied on, however this is no longer happening. While economists insist that the balance will return, industries are dying and not likely to return. Fruit trees that take 10 years to establish are being pulled up, farmland is being turned into housing estates and factories are being converted into trendy inner city apartments. Multi-generational unemployment is a social problem that provides entertainment for Current-Affair viewers but problems for everyone else.

Seriously, we are living in an economy that serves the needs of the few and disregards the needs of the many. If ideology is turning a blind eye to the plight of workers, manufacturers and farmers then this ideology is wrong. The solution is not to offer handouts to well-established institutions when they begin to fail, but to have a government that takes an active role in designing an economy that works for us all. To this end, governments have rejected a useful economic tool for keeping our economy diverse and healthy - the tarrifs. Tarrifs are a tax on imports, and bring up the cost of goods. Used sparingly but as required this tool can be used to tweak the economy to serve the purpose of serving us. Tarrifs should not be used to stop free trade, but as a means of protecting our right to decent wages, conditions and opportunities in our country and others. Setting tarrifs on imported goods should be done to countries that are not providing a safeguard to their own workers. Used this way, tarrifs are not about stopping free trade, but enforcing free trade only under fair conditions.
The argument against tarrifs commonly used is they force up the price for consumers, yet this argument seems to be completely absent when industry deregulation is likely to result in increased prices for the consumer, as it currently is the case with our gas market.

Governments are elected by us to manage the economy to serve us best, but recent governments have declared their disinterest in doing this. They believe doing nothing is in the interest of the economy, yet fail to realise the economy exists and should be managed to serve us.