Some ideas provoked by my notes on manufacturing

I got this email from an old friend currently living overseas in response to the notes I posted on manufacturing.

I haven’t thought much about manufacturing.

But I would start with trying to see what Australian people can offer others. Trade surely is more that ever the way of the future – meaning there is little point generating an economy that can produce everything – we can’t afford to be self sufficient.

What are the tradeable things? Well, obviously

  1. physical resources and
  2. goods and services around health; transport; food; education; R and D; justice; leisure and entertainment; the arts security and defence.

Thinking about how Australia would create wealth must be based on thoughts about what kinds of capital it has to do it with, and what policies it has to accumulate and direct this capital to productive ends. I prefer to move away from looking at this only as an economic issue, it is a broader social and cultural issue. Pierre Bourdieu, the sociologist, distinguished between economic, social and cultural capital. Consuming without accumulating what we consume is obviously not sustainable – though trading one form for the better accumulation of another, depending on what the other is, and what productive end we have in view for it, might be justified. Nevertheless the fundamental question is

  1. What capitals do we have?
  2. What are we to do with them to accummulate, by trade, new wealth?

Economic capital: We don’t have negative financial wealth – though the value of our physical resources are considerable and positive.

Social capital: Stable government, bureaucracy, judiciary, law and order etc, but our labour market systems are damaged and our education systems are in crisis from pre-school to through compulsory to post-complusory vocational education and higher education and adult and community education.

Cultural capital: Here we have little understanding of the cultural values of innovation around critical thinking, collectively sharing responsibility, collective risk taking, valuing outstanding achievement and creativity etc; we don’t understand that the English language is one of our cultural assets, and our shared history and cultural institutions and values with the USA and UK can help us – *provided* we understand that that these assets need to be worked at, rather than “mined” (as in the stupid higher education foray’s into Asia hitherto).

Obviously China and India are spoken about, but people forget that the EU economy is now already larger than the USA. And the EU, since the accession of the Balkans and Baltic states including Poland, is on average working from a much lower average base, so it can expect to become considerably larger still. The EU will soon have a Presidency – and yet further political and cultural integration. In other words, the EU is rapidly concentrating not only in economic capital but beginning to realise it vast potential through the formation of cultural and social capital. Ditto India, China, Russia.

Thus what is needed is a change of thinking about the meaning of being Australia. The population, for instance, though it is highly dispersed geographical, is better thought of as a spatially distributed city – rather than nation. The vast land mass of Australia confuses Australians into thinking they constitute a nation, whereas they are at most a single city.

We need to reconceptualise our places of habitation around this idea and see ourselves a 1st rate C21st world leading virtual-city. Seeing ourselves in the old way is draining the country of its possibilities – and holding its population back to mediocrity.

As a virtual-city – Australians need to compare themselves with cities like Shanghai, Hong Kong, Singapore, London, San Paolo, New York, Mexico City, etc – not with other nations. As a nation we are of no consequence, but as a city we have critical mass and command of relatively large resources to fund our accumulation of productive, social and cultural capitals. Economic capital will not be a primary result, but the secondary consequence of our success in reforming ourselves and re-envisioning our possibilities.

With our tiny population, and our time economic resources, we are not in a position to compete in first round economic capital formation. But re- construed as a city, we have immense competitive possibilities for cultural and social forms of production and wealth creation.

What all this means is that we need in Australia to generate highly networked nodes of cultural and social production, circulation, transportation and transition. Putting aside all regional oppositions the country needs to aggregate its education possibilities, the education system needs to work from cradle to the grave has to be oriented towards creating a virtual urban culture that can compete internationally – and macro/micro economic management must privilege this.

I would get rid of regionalism – decentralisation etc.

More later – ha ha!

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Paul Frijters
Paul Frijters
14 years ago

there are many things here to agree with and many not. On the whole, I’d have to say this letter is not great. The anonymous writer above clearly has an insufficient grasp of how important our self-conception as a country is for the maintainance of our institutions. The notion that Australia is mediocre is equally silly. Australia is in my opinion the best country of the world to live in. The rest of the world is in this sense mediocre, not us and this continuous tendency to look up to abroad as ‘better in all respects’ should be seen for the uninformed cringe it is. Europe is still a fairly disfunctional mess and not something for Australia to emulate in general and the observations on Europe given above appear fairly shallow to me.
As to

we need in Australia to generate highly networked nodes of cultural and social production, circulation, transportation and transition. Putting aside all regional oppositions the country needs to aggregate its education possibilities, the education system needs to work from cradle to the grave has to be oriented towards creating a virtual urban culture that can compete internationally – and macro/micro economic management must privilege this.

one would have to say the first line reads like management babble; the line on education something I’d agree with; the virtual urban bit silly (we ALREADY compete interationally); and the whole conception that Australia is best viewed as one city is also strange. We’re a fairly dispersed set of cities with a lot of recreational space and highly profitable mines in between. That’s quite different to a single city.

MikeM
MikeM
14 years ago

we ALREADY compete interationally

Um, here’s how we compete internationally (from the ABS 2007 Yearbook):

Top product exports (2005-05 year):

Coal $24 billion
Iron ore & concentrates $13 billion
Gold $7 billion
Aluminium ore & concentrates $5 billion
Aluminium metal $5 billion

Education exports earned nearly $6 billion, but as university quality improves elsewhere and diminishes here, our competitiveness is built on shifting sand. Still, we can always dig up and ship out more stuff, sell off more Australian companies and real estate to foreign investors – until everything digupable and saleable is gone.

Then what?

If competing internationally means having a trade profile like a 19th century British colony then we are doing really, really well.

trackback
14 years ago

Innovation, creativity, culture and industry policy…

One of the cut through lines that Labor has been reciting this year has been “ensuring prosperity beyond the resources boom”. There’s obviously a degree of political spin in it, but there’s also some truth. State Labor governmen…

Ben Eltham
14 years ago

Nicholas, what is your friend’s name? His ideas are fascinating and timely.

I would like to quote him in an article I am pitching to Fairfax

Clive
Clive
14 years ago

Paul

You write:

“The anonymous writer above clearly has an insufficient grasp of how important our self-conception as a country is for the maintainance of our institutions.”

I’d be interested to know what you have in mind here as I would have thought the situation was more the other way around.

Whatever – this doesn’t seem to be my point, which is that the notion of Asutralia as a “nation” does not suit the needs and of the people whole live on this continent, and that something else is sorely needed.

To further my point – many of us have grown up being wearied by endless references to Australia “coming of age” and whether “our (sic) national identity” is this or that. Whatever was their justification, I am confident these notions are now completely bankrupt. The very idea of *any* people “coming of age” smacks of colonialism – not even post-colonialism. Further, there is no sense of talk about “its” (ie Australia’s) culture as new or young, when indigenous peoples have been here 60 000 years and the European culture played out here has at least as ancient a pre-history and a recorded history dating at least 3 000 years, let alone the histories of other peoples who are also living here such as the Chinese (likewise, 3 000 years). If the point is that they are newly juxtaposed, this point then could and should be made of Europe, or of the UK, or the USA as starkly and abundantly as for Australia. Yet few, when speaking like this, think of Europe as “new”, “young” etc – as if the EU and its emerging institutions weren’t straight out of the packet. Even the notion of “nationhood” when applied to Australia, would see the formation of Australia about or not long after that of Italy, Germany or before Poland. I am pointing out that our discourse around “new” and “young” and “old” and “mature” just has to be taken with a pinch of salt, though it usually taken just so seriously.

As a result, many Australian’s carry around with themselves an utterly defunct sense of ‘Australia’. Indeed, on the contrary, there is less that is new or green in society of the people who inhabit this land, and more that is old and now profoundly redundant.

AGainst this, I am not suggesting Australia play catch-up, I am suggesting that people living on the terrain of Australia start working with the magic of the place and its people fully comprehended, and create something which befits the land and the history of its various peoples.

Clive