Australia’s regions are the cities’ ugly cousins

Nick Klomp – vice-chancellor of CQUniversity – has attacked the wilful neglect of Australian regions, which are treated like ugly cousins of Australia’s cities:

Like it or not, Australia’s rise or fall over coming years will be played out in the regions, by the regions. The main problem is this: Regional Australia lacks both the quantum and dispersion of infrastructure, resources and specialised workforces required to meet these challenges, and metropolitan Australia appears comfortable with this vulnerability. The politely passive attitude of our city cousins towards our regions, combined with regional Australians’ frustrating propensity to be the ultimate “Quiet Australians”, is our recipe for self-harm…

As regional Australians we generate our fair share of national prosperity, yet we seem to expect very little from our country in return. With an attitude of resigned indifference, regional Australians appear to simply accept an inferior position on our nation’s economic, cultural and social ladder.

Since Federation we’ve allowed our geography to validate our inequity, but this horse-and-buggy-era mentality sustains a perceived irrelevance of the regions…

Regional Australia is as remarkable as it is underestimated; we are a vibrant multicultural success story, a showcase of commercial diversity, a driver of innovation, and an unrelenting economic powerhouse fuelling our nation’s coffers…

So why is it that as regional Australians we accept — indeed expect — poorer health outcomes, lower life expectancies, inferior roads and infrastructure, reduced services, slower internet, public transport rations, fewer opportunities and, as we in the education sector are acutely aware, much lower levels of education attainment?

How did we all decide to quietly indulge the metropolitan prejudices that infect our centralised bureaucracies, our parliaments, and our media, manifesting as mediocre dividends for our regional communities?..

Ordinarily, this is where the predictable arguments of “economies of scale in service delivery” put regional Australia back into its box. But far from being the stereotypical dead weight of the nation, the regions have always paid their way — and often much more. Regional Australia, for instance, accounts for two-thirds of national export wealth and about a third of Australia’s gross domestic product…

Of course, different regions have different strengths, but collectively we’ve been pulling our weight, paying our taxes, lightening the national load, and shaping the economy this whole time. This makes the benign neglect we experience from our capital cities all the more baffling.

Nick Klomp is right, of course. The regions provide Australia with not only its food, but also the lion’s share of its export revenue, which is effectively what pays for Australia’s imports (consumed mostly by city dwellers):

That is, Australia’s wealth is primarily derived from the nation’s immense mineral base. Without them, the nation would effectively be bankrupted.

Sadly, the neglect of Australia’s regions will only worsen as the ‘Big Australia’ mass immigration program inflates the populations of the major cities, thus increasing their political power.

While Australia’s population is projected to grow by 17.5 million people over the next 48 years via mass immigration:

Australia’s major cities are projected to roughly double in size:

Such massive population growth will obviously dilutes Australia’s mineral wealth across more people, making incumbent residents poorer.

And since Australia mostly pays its way in the world by selling-off its fixed mineral endowment, increasing the number of people will also worsen our trade balance and current account (other things equal), since it will increase imports by more than exports.

Australia would ship roughly the same amount of hard commodities and agriculture regardless of how many people are coming in as all the productive capacity has been set up and it doesn’t require more labour. So basically, by engaging in mass immigration, our policy makers have chosen to wreck the trade balance by more people coming in each year (mostly to Sydney and Melbourne) because of all the additional imports.

Anyone disputing this view only needs to view the below charts showing the stalling of export growth amid the sharply deteriorating trade balances in NSW and VIC, which of course have been the primary destinations of migrants:

This population flood has driven gigantic trade deficits in Australia’s two biggest states:

In sort, having bigger cities means a less competitive Australian economy and a worsening current account.

Australia needs a well-diversified, balanced, economy with a wide range of industries located across the nation. Not an economy increasingly based on people-servicing, ticket-clipping and rent-seeking, whereby the spoils flow to a small group of CBD elites at the expense of everyone else.

Leith van Onselen
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