The economic conundrum that is Australia

As soon as you look at Australia’s economic situation, you know that the country’s industrial base is substantially owned, and therefore controlled, by foreigners. There are not many major industries not under the control or influence of overseas shareholders. You find out, too, that the people are either indifferent to this situation or think that it is all right; or they simply deny it.
… The necessary emphasis is on expanding production. Without expansion, the economy stagnates, affecting employment, income flows, and all the rest of it. … And how is this growth – industrial growth, not population growth – to be achieved? (Although there was once a senior public servant and his politician master who supposedly coined the rallying cry, “Root for Australia” as a solution to Australia’s population needs.)

… A few decades ago, it was reported that Australia is unique among relatively developed nations. In a very short time after entering the industrial development phase, the country skipped the normal phase of widening and deepening its industrial foundations and became a high consumption nation – through redistribution of incomes policies. This was done for socially desirable motives, but it ignored, and continues to ignore, the need for national savings to fuel future growth.

So, who provides this fuel? Why, foreigners of course. … When you look at Australia’s balance of payments data, you will find that it is the continued inflow of foreign capital which upholds the Australian economy.

It’s against this background that I joined an agency whose role was to assess the protection Australian manufacturing industry needed through duties or tariffs imposed on competing imports. … The executive staff of this small agency were very courageous in appointing a migrant, especially a coloured one, to deal with senior representatives of industry in the early Sixties. Most of the latter would be ‘old’ Aussies employed, to a large extent, by foreign owned enterprises.

I would have been the first foreigner in their dealings with government. It was fascinating to watch the expressions on some faces when they came to realise that I was the initial and main filter of their sworn public and confidential information on their productive viability.

… My first report was on a single product. I apparently introduced, without any such intention, two major changes in the operation of that agency. I wrote an eleven page report, when apparently others had produced much longer ones in a comparable context. I had also recommended removal of tariff protection for that product. I therefore became the first “free trader” in that office; in the prevailing atmosphere of protection that was not a great reputation.

Hence I was privileged to have my first report examined by the CEO (Chief Executive Officer) line by line; every fact was checked, and every statement was examined for accuracy, fairness, grammar, and style. I passed. … He approved my inspection of production facilities. He knew what I was really after; to get behind the smooth witnesses and their beautifully packaged data. I thus managed to talk to production engineers, research staff and marketing peoples, formed my impressions, and asked the Board to seek the information which would either confirm or deny my suspicions. I also obtained approval to visit the applicants’ opposition who spoke freely outside the ambience of court-like hearings.

… I got to know the deputy chairman of the Board well, early in my career, when he summonsed me. Quite gently, he pointed out that I had no right to ask a witness for any information … I was to give him my questions and my reasons. Once he understood how I operated, reasons were not necessary.

… It was therefore a surprise for me (and for everyone else) when, in a difficult case, the deputy chairman asked a really curly question and literally forced the witness to deal with it. He then looked over at me sitting at the next level, which was above that of the audience, and gave me a broad wink. That was the best way to tell the whole industry whose question it really was. But he was a great man, seconded from industry. It was a pleasure to work with him, provided no mistakes were made; otherwise one could come out looking like the proverbial pancake.

(These extracts from ‘Destiny Will Out’ indicate that I continued to have wonderful bosses. The CEO of my first public sector agency, who wanted me to remain, understood my need to expand my skills. The next CEO and the Deputy Chairman of the Board liked my approach; I was allowed to inspect facilities as I wished because I ferreted out necessary background. Most importantly, I was accepted by those in the private sector: perhaps they sensed my support for private enterprise.

Yet, we were upholding economic and technical inefficiency in the manufacturing sector. I therefore attempted to infuse a free trader perspective into our work, as this could contribute to greater efficiency in those firms and industries living behind a tariff wall. I spent 6 years in this agency, and was promoted twice.)