Who was the wise statesman who made the following comment:
“
The miner, the industrialist, the trader, the financier and
the banker, if they play their role correctly, will do more to
achieve world understanding and peace in a generation than
the politicians and diplomats could do in a hundred years. Why?
They are closer to reality, closer to their opposite numbers,
closer to the community in the countries where they operate.
In other words, they have more to do with real people than
with institutions.”
It was Sir Charles Court, back in 1971, as Minister for
Industrial Development, before becoming the Premier of
Western Australia. His words are a precise and humble
comment that recognises that as much as politicians may think
they set the pace – it is real people like you, representing your
country, or your company, that have the deep and lasting effects
on relations between countries.
Each time I travel, I remember those wise words.
It has been my honour to be almost the lone Australian at
recent economic conferences in Turkey, Israel, Shanghai, Prague
and New York. On each occasion, the languages and accents are
vastly different, and the problems, whilst superficially different,
have one thing largely in common – government spending, on
average, has grown from about 12.7% in 1914 to 47.7% in 2009.
Governments say they spend because the economy is weak.
But the economy continues to be weak because government
spending is crowding out productive private investment.
It is a vicious cycle that needs to be broken by re-evaluating
the role and scope of government in societies of free and
responsible individuals.
Professor Peter Boettke, of George Mason University USA,
puts it this way, “The important political/intellectual activity
of our age is not to starve the state of resources but to build the
intellectual case that we can starve the state of responsibility.
“
Also, society can in fact provide the necessary framework
and acts of compassion to render state actions needless. But
before that, it is necessary to demonstrate that the justificatory
arguments for the state are not as airtight as imagined...”
By doing more for ourselves and making fewer calls on
government handouts, we can reduce the entitlement ‘tsunami’
currently infecting the world. However, it takes courage
for business and community leaders to stand up against
all-consuming, heavy-handed governments.
In Turkey I marvelled at the courage displayed by the
various youth leaders from the ‘Arab Spring’ group of besieged
countries. I couldn’t help wishing that Australia’s crop of
non-courageous business leaders could have witnessed
these speeches.
Australia’s current economic debate is more of a light-hearted
spectator sport between the Keynesians – those who advise
governments that they will retain their popularity by promoting
the myth that debt-fuelled consumption is the pathway to
a growing economy, and the Hayekians – free-marketeers
who feel that debt can destroy, and are uncomfortable about
bequeathing this debt to the next generation.
The most entertaining version of this debate;
Fight of
the Century – a Hayek vs. Keynes Rap Anthem
can be viewed
on YouTube.
Yes, it would be encouraging if we could see big business
get up off its knees and defend the country against big
government, rather than them seeing government as simply a
dispenser of permits and privileges.
Back on the Keynes versus Hayek economic debate, I was
reminded in Shanghai at the Austrian Economics Summit that
the Chinese have a much longer view of history, and have
been debating the big government versus small government
question for centuries. They had a similar ‘rap’ re-enactment
where Confucius was the equivalent of Keynes and Lao Tsu, the
equivalent of Hayek.
Both these Chinese scholars (Confucius and Lao Tsu) were
from the sixth century BC and now, over 2,500 years later, the
debate between big and small government continues.
Here is a sample of Lao Tsu:
Why are the people starving?
Because the rulers eat up the money in taxes
Therefore, the people are starving
Why are the people rebellious?
Because the rulers interfere too much
Therefore, they are rebellious
Perhaps this explains why Lao Tsu has been my favourite
philosopher for many years.