EDITORIAL | “Batten down the hatches” – Exports to become even more important

The current Australian political situation reminds me, very unpleasantly, of early 1972. The scene is eerily similar. Then we had the hapless, incompetent Prime Minister Billy McMahon leading a crew of largely hopeless ministers who, collectively, were very inadequate communicators.

Now we have just dumped a similarly appalling communicator in Malcolm Turnbull who was “supported” by a largely unimpressive gaggle of ministers. They were also hopeless communicators. Worst of all, they were and are dreadful ditherers. None of them could or can make a sensible decision and stick to it.

Now, under Scott Morrison as Prime Minister, who knows? At least he and new Treasurer Josh Frydenberg are better communicators. They were, however, leading members of the previous cabinet. They are, of course severely handicapped by the likes of Marise Payne at Foreign Affairs and, God help us, Chris Pyne in Defence. There are numerous other “duds’ but they are probably the worst. Pyne, particularly, is liable to cost us dearly.

“So shall ye reap…”

Again, similarly, instead of the ruthless, egotistical economics ignoramus of Gough Whitlam, we have the ruthless, slippery and equally economically ignorant Bill Shorten as Opposition Leader. As with Whitlam, Shorten is backed by an unimpressive team of shadow ministers. They seem to be full of the same whacky, expensive and completely impractical ideas as were the likes of Jim Cairns, “Strangler” Connor, Al Grassby and the rest. I am reminded of the old Biblical saying: “As ye sow the wind so shall ye reap the whirlwind.”

As in the early seventies, the frightening problem is that the ALP opposition’s promises sound enticing, especially to poorer and younger voters. They appear to have no recollection of the mess made by the previous Rudd/Gillard/Rudd “governments” let alone the appalling economic disaster that was Whitlamism. They believe the promises, no matter how far fetched, and, eventually, will have to live with the consequences of their folly.

While the mining and oil and gas industries – at least in the West – seem to be recovering, we are suffering a terrible drought which is badly hurting our agriculture. At the same time, the all-important property and construction industries are going into reverse and manufacturing, more widely, is dying. Even without an almost certain to be elected ALP government, we will be doing it much tougher from next year unless a miracle occurs. We are heading into very stormy economic waters. It is time to batten down the hatches.

The young and poor, of course, will suffer most under a Shorten government even though they will be the ones who will elect it. That is always the way. In politics, rhetoric and reality rarely coincide. It is almost certainly too late for the older and more experienced among us to persuade the young of what they are getting us all in to. They will reap their whirlwind and learn about economic realities the hard way.

“…without any help from current Defence Industry Minister, Christopher Pyne”

So, what of Australia’s maritime industries? Fortunately, they will be rather insulated from the economic disaster that is about to hit us. They are a vital part of the national economy but, in reality, only a comparatively small part. If President Trump, as we trust, fails to completely kill off international trade, shipping and ports should continue to operate reasonably busily, especially our bulk ports. Our mineral and gas exports seem unlikely to be too badly damaged unless, of course, some mad idealistic green zealot manages to convince the ALP government to stifle them.

Thanks to its high proportion of exports, the fishing and aquaculture sectors should continue much as they are at current, low levels. Again, of course, unless some mad ideologue is able to change the environmental and labour rules regarding that industry. It has to be remembered that hard line unionists dominate the ALP. They have a long record of shooting their industries and their members in the feet. Of course, that never worries the union bosses. They are employed on terms that defy economic reality and will probably end up in Parliament anyway.

Naval shipbuilding is another massive Canberra inspired folly but we can’t really blame the ALP for that. I have written at length about that previously but much of the blame can be sheeted home to Christopher Pyne. Commercial shipbuilding and designing, very fortunately, is another matter. Our major ferry builders and designers are doing very well and enjoy a high proportion of export sales which will insulate them from the coming downturn. Even some of the smaller builders and designers are gaining worthwhile export orders. If things get really bad here, they can reasonably readily move their activities offshore. Some have already done so, at least in part.

Interestingly, despite the mad folly that is domestic naval shipbuilding, some of our ship builders and designers and equipment manufacturers such as Austal, One2Three and LSA are obtaining very significant defence export orders. Contrary to his insulting and grossly inaccurate boasting, this is being achieved without any help from current Defence Industry Minister, Christopher Pyne.

So, with careful preparation and largely by maintaining its strong export focus, the Australian maritime industry should survive the coming economic downturn reasonably well. That is as long as it “battens down the hatches” in time.