Steve Martin: Forget ‘Future Made in Australia’, what about a ‘Future Made On Farms’?

Farmers who have been around for a while will be shaking their heads in bemusement at Prime Minister Anthony Albanese’s recent “Future Made in Australia” pronouncement. The Government is about to put its hand back in the pockets of primary producers to pick and fund winners in other industries. WA farmers in particular, who export most of their produce, have every right to question the use of the tax they pay to prop up or develop local manufacturing — green or otherwise. We will come back to whether we should have any faith in any government’s ability to pick winners in business, but whenever they do, they have a nasty track record of then feeling the need to “support” those businesses when the chill winds of economic reality start to blow. That can be the result of the locally made product being either too expensive, not what consumers want, or not up to the standard of imported goods. And governments “support” these industries with taxes from everyone else. And why does this matter to primary producers? It matters because WA’s extremely efficient and productive farmers tend to export the bulk of their produce. And the reason this protectionist mood currently infecting global decision makers matters particularly to farmers has been long established. Almost 100 years ago, when a similar protectionist sentiment was gaining popularity, the Brigden Committee Report in 1929 regarded tariffs as a tax on exporters whose prices were fixed on world markets. Nothing has changed. Sadly, the political response in the first few decades of the previous century was to balance out the support of manufacturing with support for farmers. And they chased each other’s tails in an unsustainable whirlpool of falling productivity and lack of competition for decades. Nobody wanted to pay for our wool, so we guaranteed a reserve price for growers. At the same time, locally made clothes were more expensive than garments made overseas, so we slapped a tariff on imported products and Australians paid more for clothes. Anyone remember the Australian car manufacturing industry? For decades, tax-paying primary producers watched as governments threw money at Ford, Holden and others. And worse still, farmers were then forced to pay more for vehicles than they otherwise should have because of protectionist tariffs placed on imports. And long after the demise of the Commodore and Falcon, Canberra is still collecting the luxury car tax that was designed to keep Australian cars on the market. There is another benefit to a Labor Government, which hasn’t been mentioned by Mr Albanese, from “investing” in manufacturing — union jobs. Australian unions have always been supporters of protected local industries. Not so much the lower-income groups who were forced to pay more for clothing when tariffs on textiles existed in this country. Labor’s latest scheme was unveiled last week but has already drawn widespread criticism. The Productivity Commission has warned Labor’s Future Made in Australia proposal is likely to carry an immense price tag and risks creating industries that are reliant on long-term taxpayer support. Sound familiar? Despite the lessons of history, Mr Albanese is about to throw billions of your money at green energy and local manufacturing. He is confident he can predict the future. “From time to time we’ve been effective at value-adding, but too many times we’ve just let those opportunities go past. When you have the best product, most efficient in the world, for something that will grow in demand, then we are very, very confident,” he said. WA farmers would also be aware of the irony of a Federal Labor Government desperate to fund industries that apparently can’t survive or develop without government assistance. Industries that need tax-payer assistance because they aren’t competitive. Why else would they need funding? The live sheep industry doesn’t need public handouts. The live sheep industry doesn’t need billions of dollars of government “support”, and it is entirely renewable. Without any help from Canberra, the live sheep industry provides jobs in regional communities, export income, and tax revenues to Canberra. What about a Future Made On Farms? Steve Martin MLC is a Member for the Agricultural Region and Deputy Leader of the WA Liberal Party.