There was much promise when the Rudd government came to power, especially with its slogans such as a ‘Education Revolution’ and efforts to attack the Howard governments lack of spending on education was crimping our economic prowess. With this in mind a fellow aussie blogger Colin Docherty makes a good point about its recent disappointing turn to populism

its interesting that Labor were elected fronting the idea that Australia’s greatest asset was its knowledge, and our potential to put that to use, economically. After criticising the Liberal government over many years about the lack of technical development, its interesting that Labor seemed to have abandoned their plan for a ‘Knowledge Nation‘ (which former leader Kim Beasley ran a failed campaign on), beyond meaningless rhetoric. And now Labor leader Kevin Rudd has taken the cliche political path of sniping at companies partaking in this intellectual revolution. He’s hardly been partisan about this either, with Malcom Turnbull and just about every politician with a microphone near their mouth doing exactly the same.

If a knowledge nation and intellectual revolution was coined as the country’s future path many years ago, why are we selling ourselves short by reverting back to political populism? Instead of wasting time bickering about whether what Pacific Brands did was right, why not instead spend time working on re-training programs,

This reminds me of a quote which I tend to attribute to Paul Keating though can’t re-find my reference: That Australia must become the “brain to Asia’s brawn”. Whilst Australia rode in on the sheep’s back, or manufactured its way to prosperity in the post-war period, it is through the service economy, and designing, marketing and selling products that we are going to be successful in the future. This in many ways was the great failing of the Howard-Costello government. Whilst it could manage the day to day economy, it didn’t have an idea for how Australia would earn a dollar in the future. I had put it down to the general luddite nature of the older members of the government, Howard/Alston and the like which held it back from embracing a digital economy, but reading Peter Costello’s memoirs reveals the malaise was much more wide spread:

‘A particular line of attack on my economic management was that we had failed to encourage dot-com companies, had missed the technology boom and had therefore presided over the collapse in currency. Many critics recommended that Australia quickly establish microchip manufacturing…. The Labor party at this point lacerated the government for the weak exchange rate and its so called reliance on mining. When, some years later, mining became immensely profitable and the high-tech bubble burst, it said we were riding the boom. If Labor had its way we would have got out of mining just when it was about to take off and invested in technology just when it was about to collapse’
– The Costello Memoirs 2008: p 155

In short, Costello seems to argue that it is impossible for the Australian economy to both walk and chew gum. Either mining or IT, not both, and whilst the giddying heights of the IT boom have proven illusionary, to publish an account in 2008 suggesting Australia didn’t need to get on the IT bandwagon (or more accurately get back the bandwagon, as we used to have a world-class industry). Such a tunnel vision government could never summon the interest to push potential new industries, and consequently left Australia out of the great innovative turn of the 21st century*. These captains of capitalism in short managed to prove their own rhetoric about the inability of government to keep up. Shame the opposition had no trouble making the link

Rudd came to power promising a new approach, but thus far it has translated to a few nice rhetorical lines and otherwise cheap economic populism. Rudd would do well to spend less time worrying about the decisions he cant change (like Pacific Brands) and instead helping build for those modernisation steps he can bring about.

* This however is far from the worst luddite sin of the Howard Government. A highlight for me was witnessing Browyn Bishop during a House of Representatives Committee tell a group of public servants that those who had created the MP3 standard were acting as a cartel. I doubt Steve Jobs or anyone who has ever bought an Mp3 player(such as an Ipod) or ripped a CD would agree….