Australia Rising

Roger Kerr (historic), Role of Government, Taxation, Uncategorized, Worth A Look

Speaking last week to the Queensland Media Club, Australian prime minister John Howard described the sort of world Australians would be living in a decade from now, and his vision of “an Australia rising to new heights” to meet its challenges.

In a speech full of energy and optimism, Howard urges Australians to work hard to retain their country’s place in a fiercely competitive global economy, to stay engaged in the global battle of ideas, and to continue to face up to the hard choices and trade-offs that are necessary if Australia is to remain a land of opportunity, social mobility and prosperity.

“There’s no reason why Australia should not be even more prosperous by the year 2020”, says Howard. “But it means becoming even more competitive through economic reform. It means keeping the size of government and our tax burden down on workers and risk takers. It means keeping downward pressure on inflation and interest rates through budget discipline and a flexible workplace system. It means creating the conditions for growth so business will continue to invest and create jobs.”

After 16 successive years of growth and a steady rise in incomes that’s put their country in the top tier of the world’s economies, Australians might be forgiven for taking a tea break at this point, but there’s no such suggestion coming from their political leaders, or for that matter from mainstream Australian media.

Instead politicians and commentators alike regularly remind Australians that the job is never done, and that there should be no roll-back of the reforms that have kept Australia’s economy growing. “Any step back”, says Howard, “will see Australia fall behind in the global economy, reducing our capacity to create jobs, to innovate, to care for the sick and the aged and to help those who need a leg up in today’s competitive world. This is not simply an economic argument. It lies at the heart of our quest for a better society.”

Howard openly acknowledges that Australia’s success story has been the work of both sides of politics in government. “Looking back, broad consensus surrounded the need for five great structural reforms to give Australia a shot at prosperity in the 21 st Century. They were financial deregulation, tariff reform, privatisation, tax reform and workplace relations reform. And I’ve always paid credit to the former Labor government for its reforms in the area of financial deregulation and tariffs.”

Speeches like Howard’s are in stark contrast to the muted language of political leaders on this side of the Tasman. The P word (privatisation), for example, appears banned by politicians of all persuasions, and the critical reforms undertaken here by both Labour and National governments of the late ‘80s and early ‘90s often seem air-brushed out of political history. Even parties who supposedly embrace the need for further economic reform step gingerly around the topic in public.

Compare that, for example, with the mantra of rising Australian Labor Party leader Kevin Rudd, who talks comfortably about concepts like privatisation and tax reductions – and even some elements of workplace reform. His proposal, for example, to exempt businesses for varying lengths of time from unfair dismissal procedures, even though it waters down the Howard government’s moves, puts him ahead of the National Party’s policy of a 90-day probation period.

The Australian public and their politicians are regularly challenged to aim higher by a media equally at ease with discussing the structural transformation behind Australia’s boom and keen to see the country continue to enjoy rising prosperity.

Why are New Zealand politicians and journalists so reluctant to challenge this country to do better, so apparently afraid to spell out what we know is required to lift our game and get moving on a track like Australia’s, the same track that brought us gains that are now eroding?

Back to Howard’s clarion call: “It’s critical that Australia not slip back to the ways of the past … I want Australia in 2020 to still be the best country in the world in which to live, to work, to start a business and to raise a family … We are here in the Asia Pacific region, a region that will be the cockpit of history in the 21 st Century. It will be a world of intense competition for markets and global talent … Australia may never be the most powerful nation in the world, but we can be an even greater nation than we are now.”

Australia still has many issues to grapple with, but our political leaders have much to learn from its success. As they watch Australia rise to new heights on all the international measures of freedom, prosperity and quality of life, while we drift steadily backwards in the rankings, New Zealanders should be listening carefully to the language – and the ideas – of winners.

Roger Kerr is the executive director of the New Zealand Business Roundtable.