Reporting of Federal Parliament this morning was dominated with claims by Shadow Treasurer Joe Hockey that the Budget is about to return to deficit and counter-claims by the Government that it is not.
The far more serious deficit, which got no mention, is the deficit to humanity's natural capital, caused by the consumption of non-renewable natural resources and the destruction of our natural environment, without which the global "economic recovery", in particular China's, would not be possible. Australia's rulers are banking on the increased demand for Australia's mineral wealth by China's vast manufacturing sector keeping prices high and money flowing into the Australian economy.
The ecological cost of the increased emission of global-warming carbon dioxide and other pollutants from China's factories and the consumption of mineral resources, which rightly belong to all future generations of Australians, as well as this one, got no mention. Also to dig up so much coal, much of Australia's natural and rural areas face devastation.
Even if China's "growth" were to continue, with its terrible environmental cost, the financial benefits to Australia are likely to be limited by other mining countries being able to fill much of the demand, thereby lowering the high prices upon which the Australian Government is depending.
The only truly sustainable economy is one which is not dependant upon the fortunes of overseas giants. Australia once had a manufacturing sector with a decently paid workforce that was able to meet almost all of its needs, even during the years of the Second World War.#main-fn1">1 Only by returning to an economy something like we had then can we hope to have true long term prosperity for all citizens which is not dependent, in a colonial fashion, upon the fortunes of large overseas nations.
#main-fn1" id="main-fn1">1. #main-fn1-txt">[back] According to Armed and Ready - The Industrial Development and Defence of Australia 1900-1945 (1995), by Andrew T. Ross, produced as part of the Australian War Musem's "Australia remembers 1945-1995" commemoration, Australian defence capability alone, largely derived from its own defence manufacturing industries, dissuaded the Japanese from invading Australia in 1945. At meetings in February and March 1942, the Japanese Navy proposed that Australia be invaded. This was vetoed by the Japanese Army. The Japanese Army vetoed the Japanese Navy's wishes because its knowledge of the Australian armed forces and its strategic knowledge of the Australian economy convinced it that it would not be able to win a war on Australian soil (pp 408-409). Andrew Ross argues that the Japanese Army's assessment of Australia's defence capability was accurate. Ross's thesis has not been challenged by any other historian in any work comparably researched since then. That Australia's own domestic resources could dissuade such a powerful, populous and militarily effective nation from invading its territory, when it had the occupied nearly all the territory to our North is surely testimony to Australia's manufacturing capability back then. Since then, Australia's leaders have allowed the edge that we have achieved to be lost. Is it too late for this nation to be able to regain that edge?