Manufacturing Australia

The free market system, capitalism, can be an incredible engine of wealth creation and prosperity, but like all human activity, only because it has government, rules and umpires to channel it in the right direction, support it with a ready supply of educated labour, political stability (via equity), reliable energy, infrastructure, especially transport infrastructure, health and hygiene (water, sewage systems and health care), and contain its oppressive, damaging excesses. 

Without a strong regulatory regime, there is either totalitarianism: communism or fascism, or anarchy. The government sector is essential to the civilised management and success of capitalism. The idea that the more free the market the better for society, is either a self serving utopian delusion, or an epic confidence trick. 

We must never deaden the wild, creative, animal spirits that are our inventor and entrepreneurial class, but it must also be given boundaries, it must function for the good of civilised society, not just  for the benefit of a super class of overlords.  We are already seeing that reality; the political donation system has all but corrupted democracy in the US (36,000 full-time lobbyists in Washington spending more than $5mil per year for every Congress or Senate member). In Australia the situation is not much better.

The government sector also provides ballast for the wild ride that is the free market system, with its recessions, depressions, and GFC’s.  It also provides the equity that delivers the political stability that the free market economy depends on, and the equity that promotes the demand that businesses depend on, and the equity that ensures a dignified life to all. 

Now that our comparative disadvantage of high wages is being removed by robotics, the country can leverage its renowned inventor class, its excellent higher education system, and its wealth, and supply the world with high value added manufactured products. But it will need both government and private enterprise to achieve that. 

Yes, Australia needs a manufacturing industry.