We stand high on the podium of economic success
I’m pleased to be able to reproduce my colleague Craig Emerson’s article from The Weekend Australian:
Let the Games begin. With the dazzling opening ceremony over, our Olympians are representing Australia at London with pride and distinction.
Australia has been a top 10 country in the final Olympic medal tally at each of the past five Games, averaging sixth place. Here’s betting we will finish around that spot again, though the number of personal best performances may be a superior indicator of success.
The global sporting arena is not the only place where Australia excels.
Yet judging by the tone of national conversation, we are experiencing a high degree of difficulty acknowledging our success.
Understandably, people worry about how developments in Europe may affect them. They’ve been frightened by the most negative federal opposition in decades, with claims that cost of living increases associated with carbon pricing will be beyond imagination. And house prices have fallen from their unsustainably high levels, along with superannuation accounts, giving many Australians a sense that their household wealth is in decline.
But first the week’s news. On Thursday the official inflation rate dropped to a 13-year low of 1.2 per cent and on Tuesday Reserve Bank governor Glenn Stevens delivered a landmark speech in which he described Australia’s economic performance as remarkably good. Stevens pointed out that this wasn’t just a matter of good luck but of good management of the economy, a track record of containing inflation, sound budgetary policy and a well-supervised banking system.
Australia’s unemployment is just 5.2 per cent, economic growth a strong 4.3 per cent and the Reserve Bank’s interest rate is down to 3.5 per cent, about half the rate at the change of government in 2007. Investment is at 50-year highs with $500 billion of it in the pipeline.
When Paul Keating boasted in the late 1980s of a beautiful set of numbers he was staring at nothing as impressive as these.
How about Australia’s place in the world economic rankings? Australia has a faster growth rate than all the main advanced economies and the second lowest unemployment rate. Our economy is 9 per cent larger than before the global financial crisis. America’s and Germany’s are less than 2 per cent larger than before the crisis, while Italy’s, Britain’s, France’s and Japan’s economies are all smaller.
Our net debt is one-tenth that of the main advanced countries and our budget is back in surplus ahead of any of them.
Of course, living standards are not all about money. How long a nation’s people live is surely a key indicator of its success. A newborn Aussie baby can expect to live for 82 years. In the race for longer lives, we win the bronze medal, behind only Japan and Switzerland.
Living longer is all very well, but the quality of life is at least as important as the quantity. By the indicator of quality chosen by the UN – expected years of schooling – Australia, at 18 years, shares the gold medal with Iceland, Ireland and New Zealand.
Combining dollar incomes and quality of life indicators, the UN comes up with a Human Development Index. Competing against 187 countries, Australia scores the silver medal, pipped by the Norwegians. But where would you prefer to live – Australia or Norway? The Human Development Index fails to include climate. If you like clouds, five-hour winter days and year-average temperatures of 4C, Norway is for you.
For the world’s best medallist, in the immortal words of Olympic commentator Norman May, it’s Australia: gold, gold, gold.
Let’s back ourselves in, show that great Aussie pride and acknowledge that we live in the greatest country on earth.
Craig Emerson is the Trade and Competitiveness Minister.