Business
  1. Home
  2. Business
COMMENT

How Australia can prove we are not the 'white trash' of Asia

Harold Mitchell

I know how Jules Verne must have felt. My recent trip to New York plus three days in Israel and two more in London was a fascinating circumnavigation but thanks to Qantas and the LLJets I did it quicker than 80 days in a balloon.

However, on return, I refuse to be demoralised, despite much of the world leaping ahead of us in crucial areas of economic policy. The highly competitive tax rates in the countries I visited mean that any change that Treasurer Scott Morrison intends to make will be completely overrun. I know he is doing his best and I don't like to be a party pooper. "Yes, you do," says Louise. "You do it all the time."

Up Next

Helicopter pilot asks truckie for directions

null
Video duration
01:27

More World News Videos

null
Video duration
01:46

Turnbull Trumped by phone-y diplomacy
null
Video duration
01:27

Helicopter pilot asks truckie for ...
null
Video duration
01:10

'Our house is on fire right now'
null
Video duration
02:26

Over 400 firefighters battle massive blaze
null
Video duration
01:27

Kiss-Cam captures fans of love
null
Video duration
01:30

CCTV clue in Kim Jong-nam case
null
Video duration
01:59

Donald Trump addresses racism, sort of
More videos

Turnbull Trumped by phone-y diplomacy

As embarrassing details of Malcolm Turnbull's first phone call with Donald Trump are revealed, the refugee agreement the President blasted as "the worst deal ever" hangs in the balance. Courtesy Seven News Melbourne.

Nevertheless, I must say we must move more boldly to get our total tax regime right if we are going to keep up with the rest of the world. Lee Kuan Yew famously threatened that we could become the white trash of Asia. We are better than that and we need to prove it.

Earlier this week I had a long-promised lunch with one of our great Australian businessmen now well into his 70s who refuses to give up. He is as sharp as ever and he said something that pulled me up as I worked my way around Melbourne's Cecconi fish special of Coral Trout.

"The think tanks in Australia are able to develop better national policy than the governments themselves."

I had never thought of think tanks in that way. I had regarded them as extensions of the suffocatingly controlled party system, but later in the day I ran into the work of Andrew Bragg – the new director of policy and research with the Menzies Institute which is chaired by my old friend Tom Harley, grandson of our second, and eccentric, Prime Minister Alfred Deakin.

Advertisement

The latest Menzies publication from Bragg is exceptional in its insight and is not moderated by party politics because it effectively puts the government on notice in relation to trade and alliances.

A common theme of this column has been that Australia needs to be strongly independent. We must recognise that Asia will soon have more than 50 per cent of the world's middle-class – the greatest generator of economic growth.

This is the group that was famously recognised as "the forgotten people" by the Menzies Institute's greatest inspiration – Sir Robert.

Bragg's timely publication emphasises that as a trading nation, we cannot afford to rely on a protectionist United States that tries to use its weight to crush successful competitors.

I have had tough personal experience of this type of American omnipresence. "That's a big word," says Louise. "You must be referring to President Trump and his friends."

Indeed I am.

Back in the 1980s I saw 30 per cent of my business disappear overnight when two global American firms took over Australian advertising companies which represented clients that made up a third of our revenue.

Immediately after the takeover, the formerly-Australian agencies were instructed to use American media buying companies that I thought were less efficient and less effective than ours.

We recovered of course and we beat them, but it was a lesson on globalisation – Australia can be very quickly dealt out of the game.

What happened to my company can easily happen to our country.

We must find trade deals everywhere.

The three major trade deals that we've recently completed are outstanding but we must keep on moving because international trade means more to us than to the US.

As Bragg points out, America's trade as a share of GDP is 28 per cent because they have such a large local market, but in Australia it stands at a critical 41 per cent.

This means that we should reform our uncompetitive tax structures and quickly boost our new industry start-ups along the lines of the policies that I referred to last week that are driving growth in Israel. If we don't, I'm fearful that we will get flattened by the American-first steamroller driven by a uniquely self-interested President.

Gough Whitlam once told me that the White House is brilliant at "duchessing" foreign leaders. They turn on the Marine band, the red carpet, the address to the Congress and before you know it you just bought a hundred $200 million jet fighters from the friendly folk at the White House.

Bragg says, we don't need to take dictation from Trump and I couldn't agree with him more.

I think Bragg's essay Fit for Service is worth a read by every federal politician. He has also shown that think tanks are probably out-thinking our federal bureaucracy as my wily lunch guest recognised.

And as my equally wily researcher Charlie says: "Now is the time for leadership, not lectures."

0 comments