Bogan sheilas and stupid men with beer guts

496696.1.highKevin Rudd’s announcement yesterday of a Special Economic Zone in the Northern Territory surely comes very close to the silliest election promise of the last decade, matched only by Tony Abbott’s almost identical promise a couple of months ago.

The only positive aspect of either policy is that as far as one can tell neither Rudd nor Abbott is actually serious.  They are merely producing shiny but worthless policy baubles in the hope that they might impress a few gullible voters in the highly marginal seat of Solomon.

The problem is that both of them are not only insulting the intelligence of Territorians but our memories as well. They must think we have a collective dose of Alzheimer’s Disease. They certainly wouldn’t have tried it 15 years ago, maybe not even a decade ago, because back then there were still too many Territorians with quite fresh memories of the financial fiasco that had occurred last time a “free trade zone” was tried as a magic bullet solution to the Territory’s chronic underdevelopment.

Unlike Kevin Rudd, Bob Hawke and Paul Keating recognised idiotic economic ideas when they saw them.

The Trade Development Zone or TDZ was one of the Northern Territory Country Liberal Party government’s signature big bucks development projects of the mid-1980s. Costing many hundreds of millions of dollars of taxpayers’ money back in the days when that sort of money really meant something, it was essentially the same concept that Rudd and Abbott are talking about now, albeit with only Territory government subsidies and tax breaks not federal ones.  Unlike Kevin Rudd, Bob Hawke and Paul Keating recognised idiotic economic ideas when they saw them.

The TDZ was touted as the big answer to the Territory’s economic problems, a concept that would kickstart industrial development and provide the critical mass of  secondary industry the absence of which had for so long relegated the Territory to stagnant economic backwater  status.  Unfortunately the concept was revealed as a mirage after eccentric veteran Northern Territory News reporter John Loizou discovered that its supposed star performer, Chinese textile manufacturer Heng Yang, was only surviving by paying its imported Chinese workers wages of one dollar per day.

Predictably, the trade unions came down on Heng Yang like a ton of bricks and it was ordered to pay the arrears of unpaid wages to its virtual slave workers, an amount of more than $500,000. Sadly for Territory  taxpayers,  Heng Yang’s Chinese owners put the company into liquidation before the wages could be paid, with the result that the Territory CLP government was forced to make good the deficiency. For several years thereafter, even mentioning special economic zones was political poison, always sure to provoke wry belly laughs among Territorians.

In fact, the eventual fate of the TDZ itself should have been predictable to anyone with even a modest amount of economic acumen, a group that clearly doesn’t include either Kevin Rudd or Tony Abbott.((The fact that the IPA’s Tim Wilson thinks they’re a really great idea should be conclusive evidence of the contrary proposition in itself. ~ KP)) Certainly the Chinese themselves had considerable success with special economic zones e.g. Shenzhen. But they combined substantial tax breaks and subsidies with a range of more general comparative advantages e.g. low wages, lax environmental and other regulation, and most importantly proximity to huge markets in the world’s fastest-growing region (viz Japan, Korea, Taiwan etc).

Neither Darwin nor the Northern Territory in general have any of those advantages. We are a long way from any population centre in Australia, and not especially close to overseas centres either.(( Actually that is an oversimplification. Darwin is actually closer to Singapore than any other significant Australian port except Perth. However the infrequency and high cost of shipping services nevertheless makes it an unattractive location for any export industry. The Darwin-Alice Springs railway was touted as a solution to that problem, supposedly generating much more frequent and lower cost shipping. So far no such trend is evident. ~ KP)) Moreover, wages, transport, fuel, electricity and just about every other cost input to industry are higher in Darwin than just about any other city in Australia. No sane corporate executive would think about establishing most types of business there, even with the sort of substantial company tax break that Kevin Rudd was touting yesterday. Lower income taxes are only useful if you are likely to make a profit.

That is not to say that the Territory lacks any opportunities for industrial development at all, but they are niche opportunities that can only generate relatively gradual incremental growth. That is, unless Rudd or Abbott is willing to ignore inevitable mass outrage and do a deal with the Americans to position very large US defence bases here. That would certainly kickstart rapid major growth. Apart from anything else, we could use it as a platform to nurture a brothel-led recovery, which could in turn lead to wider synergies. We could encourage the development of a porno movie industry in Darwin. Of course, the acting talent might be a bit thin on the ground, but we could always target the niche market of people who are kinky about hot sex between Bogan sheilas and stupid men with beer guts.

About Ken Parish

Ken Parish is a legal academic, with research areas in public law (constitutional and administrative law), civil procedure and teaching & learning theory and practice. He has been a legal academic for almost 20 years. Before that he ran a legal practice in Darwin for 15 years and was a Member of the NT Legislative Assembly for almost 4 years in the early 1990s.
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jennymcculloch
jennymcculloch
8 years ago

The future really is alive with possibility Ken.

Regarding support industries for the US military:
The arts is alive and well in Darwin I’m sure there is at least one dance company here that could manage something interpretative along sex industry lines and for the snuffers there’s alway a ready cast parading home from the pub Jess and I could nab them off the street and store them next door with the lady that sounds just like Shazza on Housos.
Regarding the empty food bowl:
The food bowl idea has been a real winner for the Territory since after the war. If you want to know how tough life on the land can be and if you want to spend all your own money and lots from the government I’d go for rice, it’ll work for sure this time, failing that peanuts do well when it floods and so do avocados. So should we plant when there is no rain at all or when it is flooding and there is no access to any of the plantations. Guess all the seedlings will be happy drowning in good company with the buffalo, water birds and insects.

jennymcculloch
jennymcculloch
8 years ago

In the interests of fairness and to prove I did do a little research and was not merely shooting from the hip, The Conversation published this article about foodbowl madness up north.

steve from brisbane
8 years ago

Ken, maybe you can answer this as someone from up there – I haven’t been able to find the answer readily by Googling.

A couple of months ago in Brisbane I heard some man on ABC radio talkback saying that the problem with any idea of Darwin expanding massively population wise is that it doesn’t actually have much potential for an increase in water supply. The geography anywhere near the place is such that rivers cannot readily be dammed, and I think he also added that even now in the dry, Darwin’s water reserves run low.

(I see from Googling that the city does get some of its water from bores, which perhaps indicates something to what he was saying.)

Is there something in what he’s saying? He was no expert, just someone who had been there…

steve from brisbane
8 years ago
Reply to  Ken Parish

Thanks Ken. I wonder who that bloke had been listening to, then…

marks
marks
8 years ago
Reply to  Ken Parish

Darwin River Dam levels.

http://www.powerwater.com.au/__data/assets/pdf_file/0009/29286/Darwin_River_Dam_Level_and_Rainfall_November_2008_December_2013.pdf

Note that there is also a smaller storage at Manton Dam held in reserve. The water is a little coloured due to flowing over leaves in the catchment, but would do in an emergency with no lengthy approval process. (Territory Health would need to give the OK, but since it was used for many years as the town supply, that is not seen as an impediment).

The real problem would be that if the Wet season failed for a few years running, then Darwin River Dam would empty very quickly due to evaporation. In fact, evaporation takes just as much from Darwin River Dam as does the general population of Darwin and the suburbs.

conrad
conrad
8 years ago
Reply to  marks

Rains failing for a few years in a row is problem every Australian city has, so saying it’s a problem for Darwin is no different to saying it’s a problem from Melbourne, Sydney, Brisbane…

marks
marks
8 years ago
Reply to  marks

Conrad,

That depends on how much capacity there is vs the demand. Low dam capacity and high demand means that a couple of years without rain is a problem compared to somewhere that has high capacity and relatively low demand.

Nicholas Gruen
Admin
8 years ago

If it’s good enough for Gina, it’s good enough for me.

Gina Rinehart, one of former treasurer Wayne Swan’s primary targets in his tax war against mining magnates, enthusiastically backed Kevin Rudd’s northern development proposals.

The iron ore billionaire founded a lobby group devoted to promoting economic development in the north, Australians for Northern Development and Economic Vision, which encouraged the Coalition to propose its own development plan for the region.

“Congratulations [to] all involved, and please deliver exciting lower tax, lower regulation policies for our north,” Ms Rinehart told the AFR Weekend while travelling abroad. “Our country truly needs some positive action to get us out of debt and help our future.

“I am ecstatic to hear that, in Australia, both major political groups are beginning to look to the future. The recognition that our north could thrive with less taxes and less regulation, is very exciting.”

Richard Tsukamasa Green

There’s even more to the Darwin Singapore comparison. According to Blainey at least, the first Darwin settlement (Palmerston, before biology became more popular than drug trafficking) was founded to become a “new Singapore”, and exploit proximity to Asia.

Within two years the population was not 10,000, it was zero.

So alongside all the other similarities, it was surpassed despite having a very similar idea behind it.

Jezery
Jezery
8 years ago

we could use it as a platform to nurture a brothel-led recovery

Not sure that would work. I remember a couple of years ago in the NT News, a professional lady was complaining that that she wasn’t getting as much work as she expected from visiting US naval vessels, because she was being cut out by enthusiastic amateurs.