It is fashionable in some circles to think of Australia’s
economy as one in full transition from primary production and resources into a
services based economy. This goes does well in inner urban circles where white collar
professionals, many of them removed from connections to life beyond a comfy three-kilometre
ring around our CBDs, tend to dominate. However, it’s a mistake to ignore the economic
reality which is that Australia’s export earnings continue to rely almost
entirely on stuff we dig up from the under the ground or grow on top of it.
Take coal for example. In 2016 coal was Australia’s number 2
export earner, second to iron ore. The value of coal exports, for context, were
nearly eight times the value of professional services exports. In a top ten
league ladder of export earning industries, professional services finished 10th
in size. The importance
of a single commodity (coal) as an export earner makes the relentless attacks
on the proposed Adani mine and related infrastructure harder to understand.
Whatever your position on renewable energy for our domestic
needs might be, trying to scuttle our second biggest export earner is reckless
economics and irresponsible politics. The commodity earns us all valuable
foreign exchange dollars which help keep our national economy afloat. The
industries around the search for, extraction of, site remediation and transport
of that commodity also employ many thousands of people – which keeps a large
number of regional communities alive, as well as city based professionals engaged
in industries like engineering, environmental science, transport and
infrastructure.
Ironically, many of the coordinated and highly emotive
attacks on the coal industry and Adani in particular have come from its
beneficiaries: urban residents who enjoy the benefits of Australia’s trade
balance in the form of social and physical infrastructure standards which
remain the envy of many countries. The evidence is incontestable: without coal
exports, our economy would plunge into a massive hole, unemployment would rise,
credit would be squeezed, and infrastructure projects clamoured for by the very
chattering classes so vehemently opposed to coal, would cease. We all lose.
Queensland’s real gross state income surged recently, and it
was down to an improvement in coal prices – as Gene Tunny from Adept Economics has
noted: “To illustrate, coal royalties in 2016-17 ended up being an
estimated $3.4 billion compared with $1.7 billion in 2015-16.”
Sadly, the economic reality is now lost in a debate about
coal, energy and the environment where truth was an early casualty. Facebook
and other social media channels carry and then amplify alarmist and simply
false claims to a wider and increasingly gullible audience. The suggestion that
we could have an informed discussion about the importance of coal exports to
our standards of living is hard to hear above the cacophony of anti-coal
protests.
None of this should be taken to suggest I’m not supportive
of the growth in professional services. As a professional service person
myself, I’d be mad not to be. But I equally appreciate that our economy – even
for those in inner urban circles that are far removed from coal or iron ore
mines, or from manufacturing plants or farms or heavy industry – desperately
needs these industries for our collective benefit.
Being able to afford eye
wateringly expensive infrastructure projects or schools or hospitals in the
hearts of our city centres owes much to what we can continue to dig up or grow
and sell overseas. We basically can’t have one without the other and suggesting
this is possible is akin to taking a gun, pointing it at your foot, and pulling
the trigger.
