Abstract
This chapter briefly reviews some Australian economic history and considers how its policies can meet the contemporary challenges of globalisation. As a well-endowed, rich, small country, Australia, from its colonial origins, has survived, thrived and benefited from ‘globalisation’, largely sheltered under its umbrella of strategic alliances with its ‘great and powerful friends’, namely, Britain and then the USA. The country’s geographical isolation, the ‘great southern land’, made its embrace of globalisation a necessity. Australia has successfully confronted significant challenges in the progressive restructuring and growth of its economy. However, recently emerging trends of global nationalism and protectionism, manifested in Brexit and Trump, raise difficult questions and choices for Australia. The country’s future now turns on how it might successfully transcend the current tide of anti-globalisation initiated by its ‘powerful friends’ while further engaging with its region and embracing the opportunities presented by the rise of China.
So what has gone so wrong? Why and when did the world turn from its commitment to globalisation and free trade on a multilateral basis? And how do we find ourselves embarking upon what looks like a new era of global protectionism and isolationism, led ironically by our two ‘great and powerful friends’—Britain with its Brexit vote and America with the election of President Trump? Will the world economy—against all past lessons—fall back into the era of ‘tit-for-tat’ protectionism, global depression and world wars consequent on the emerging neo-protectionism, isolationism and xenophobia? Is Australia in danger of ending its dream run of growth and prosperity based on an outward-facing economic, trade and foreign policy? Will Australia become inward looking and protectionist once again? Who will be the country’s next ‘big and powerful friend’ as the global power order once again historically shifts, this time from the Anglo American sphere with its commitment to liberal democracy to the Asia-Pacific?
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- 1.
According to the IMF, China overtook the USA in 2014 as having a larger GDP based on purchasing power parity (PPP) share of the world total with 17.28% and 16% share, respectively, in 2016. See IMF World Economic Outlook through Google Public Data Explorer. http://www.imf.org/external/pubs/ft/weo/2016/02/weodata/index.aspx and https://www.google.com/publicdata/explore?ds=k3s92bru78li6_#!ctype=l&strail=false&bcs=d&nselm=h&met_y=pppsh&scale_y=lin&ind_y=false&rdim=country&idim=country:CN:US&ifdim=country&hl=en_US&dl=en_US&ind=false. Accessed January 19, 2017.
- 2.
See Election Speeches from the Museum of Australian Democracy, Old Parliament House, Australia, http://electionspeeches.moadoph.gov.au/speeches/1958-robert-menzies.
- 3.
See UK National Archives on the EU Referendum http://webarchive.nationalarchives.gov.uk/20160815143715/https://www.eureferendum.gov.uk/q-and-a/. Accessed January 27, 2017.
- 4.
See UK Electoral Commission on EU Referendum http://www.electoralcommission.org.uk/find-information-by-subject/elections-and-referendums/past-elections-and-referendums/eu-referendum/electorate-and-count-information. Accessed January 27, 2017.
- 5.
Continued: ‘The move to a flawed European currency, a technocratic scheme par excellence, led to stagnation and unemployment and is driving Europe apart. Elaborate financial instruments bamboozled regulators, crashed the world economy and ended up with taxpayer-funded bail-outs of banks, and later on, budget cuts. Trade with China has lifted hundreds of millions of people out of poverty and brought immense gains for Western consumers. But many factory workers who have lost their jobs have been unable to find a decently paid replacement. Rather than spread the benefits of globalisation, politicians have focused elsewhere. The left moved on to arguments about culture—race, greenery, human rights and sexual politics. The right preached meritocratic self-advancement, but failed to win everyone the chance to partake in it. Proud industrial communities that look to family and nation suffered alienation and decay. Mendacious campaigning mirrored by partisan media amplified the sense of betrayal’ (The Economist 2016a).
- 6.
Again from Sturgeon (2016): ‘[Brexit] was also a clear expression of the disaffection with the political system that is felt in too many communities. Communities taken for granted by Labour for generations and punished with austerity cuts by the Tories for a financial crisis they didn’t cause, used this referendum to make their voices heard. The Westminster establishment hassome serious soul searching to do—and I hope that it does it’.
- 7.
Yates’ termination was justified on the grounds of her having betrayed her Department and for being weak:
The acting Attorney General, Sally Yates, has betrayed the Department of Justice by refusing to enforce a legal order designed to protect the citizens of the United States…Ms. Yates is an Obama Administration appointee who is weak on borders and very weak on illegal immigration. (White House, 2017b)
- 8.
https://twitter.com/realDonaldTrump/status/826060143825666051. Accessed February 1, 2017.
- 9.
https://twitter.com/Twitter/status/825513865794293761. Accessed February 1, 2017.
- 10.
Shorten continues: ‘I think he represents a turn towards American politics which will be destabilising for America. I don’t believe in a divisive nation. I don’t believe in dividing the nation. I don’t believe setting up one group of people against another group of people. I have a different world view’ (Shorten, 2016).
- 11.
https://twitter.com/realDonaldTrump/status/827002559122567168. Accessed February 13, 2017.
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Lester, M., dela Rama, M. (2018). Neo-protectionism in the Age of Brexit and Trump: What Does Australia Do with Its Powerful Friends?. In: Oberoi, R., Halsall, J. (eds) Revisiting Globalization. International Perspectives on Social Policy, Administration, and Practice. Springer, Cham. https://doi.org/10.1007/978-3-319-79123-4_5
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