Markets and Cultures: Penny Wong's Open Economy for the 21st Century

By Mark Hearn*

Penny Wong
Senator Penny Wong: In a dynamic regional environment, the economies that thrive in the future will be "those with people that are highly skilled and adaptable to different markets and cultures"
The mining tax fiasco sharply illustrates federal Labor's recurring difficulty in developing or explaining key areas of policy, a problem that obscures its achievements.

Recent media reports suggest Labor plans a back-to-basics strategy for the September 2013 election. Gillard Labor will be pitched as the champion of the battlers. It seems like a defensive campaign strategy, lacking inspiration and innovation.

There is an alternative narrative at work in the Labor government, although it is easily marginalised amid the daily blur of political division and turmoil. It is a narrative that seeks to reshape Australia's productive capacity to meet the challenges of the 21st century and secure Australia's integration in the Asia Pacific region.

Finance Minister Penny Wong demonstrated the persuasive capacity of this narrative in a speech delivered in August last year. Wong addressed the Brookings Institution in Washington - the leading liberal think tank in the United States - on the theme "Australia's Future in the Asian Century".

Wong argued that the economic rise of Asia was "the key public policy transformation of our generation". Given Australia's geographic position, it was "uniquely positioned to provide a bridge between the West and "the emerging Asian economies". Wong's speech foreshadowed the release of the Gillard government's white paper "Australia in the Asian Century" in October last year.

The white paper reflects the crucial economic and strategic challenges facing the nation as it seeks to integrate in the region, yet it was an initiative released and then apparently set aside. The issues raised in the white paper seem unlikely to re-emerge as priorities in the brief remaining life of the current Parliament. The argument put by Wong in Washington indicated the opportunity the white paper offered the Gillard government, in terms of both policy direction and positive election strategy.

Throughout the speech, Wong stressed Australia's "open economy". Openness provided the key to the nation's ability to benefit from the exponential economic growth in the region. By the end of the current decade Wong noted that "1.2 billion Asian consumers" will join the ranks of the middle class. In this dynamic regional environment, the economies that thrive in the future will be "those with people that are highly skilled and adaptable to different markets and cultures". Only an Australia that looks out to the region in positive terms will prosper.

Wong's theme of an open economy was consistent with the thrust of Labor reform policy that flowed from the Whitlam government's 1973 decision to cut tariff protection and open Australian industry to the stimulus of competition, a process continued by the Hawke and Keating governments, as Wong acknowledged in her speech.
Wong's historical reference was apt; you must return to the Hawke government's 1991 "Building a Competitive Australia" statement to find a Labor precedent for the clarity of open economic reform.

Echoing Keating's spirit of Asia Pacific engagement, Wong observed that during the 1980s and 1990s, Australia had encouraged economic openness in the region through ASEAN and later APEC. Now the ASEAN nations "buy around 75 per cent of our merchandised goods exports". Wong was praised by the Brookings Institution moderator for being part of a government that is "leading the world in new forms of market-based solutions to global problems", including climate change.

Perhaps that is because Wong's instinct for openness is not confined to the market.

Wong also emphasised "open-mindedness" in her Washington address. The opening of Australia through multiculturalism, and her own family experience as part of that change, allowed her to grasp that "business relationships are not just the sum of transactions" and that a "deeper engagement" is required.

Anyone hoping for Australian governance to embrace a mature debate about the future of the nation and its place in a rapidly changing region should reflect on Wong's speech, and encourage debate about the issues it raised.

Wong outlined a vision that, clearly and consistently articulated as policy, would distinguish Labor from the Abbott-led Coalition on one hand, and the Greens on the other.

Both alternatives collapse towards a tired economic nationalism - Tony Abbott floats thought-bubbles about scattering dams across deserts and public servants across Arnhem Land, while the Greens would like to throw a protectionist wall around the continent. It is Wong's imaginative openness to "markets and cultures" that Australia requires now and into the future.

* Dr Mark Hearn is a lecturer in the Department of Modern History and Politics at Macquarie University. This article was first published in the Canberra Times on February 23 2013.

Published 15 March 2013

worksite home