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Is short-termism constraining Australia’s long-term prosperity and security?

It is one of the most contentious issues in Western politics — short-termism in policy making and delivery, and Australia is no different, but is this approach hindering our ability to survive and thrive in the era of great power competition?

It is one of the most contentious issues in Western politics — short-termism in policy making and delivery, and Australia is no different, but is this approach hindering our ability to survive and thrive in the era of great power competition?

For many Australians, whether Boomer or Millennial, Labor or Liberal, one of the common points of agreement is the pervasive nature of short-termism in Australia’s policy making.

Yet, despite this overwhelming agreement, the conversations both within the halls of power and indeed around the dinner table, or in the office (as they begin to fill up once again) tends towards getting bogged down in the most outlandish or contentious social issue, TikTok trend or celebrity outrage of the day, with the big issues being kicked down the road.


In stark contrast, across the Indo-Pacific, many nations, both aspiring global superpower and established great and middle powers, have taken to playing the long game, with their eyes firmly set on the prize of positioning and achieving regional and global positions of economic, political, and strategic primacy and prominence beginning in the next decade.

Whether it be Xi Jinping’s ambitions of a glorious resurgence and return to global and regional primacy for China, like an emperor of old or Narendra Modi’s push to deliver an outwardly ambitious and prosperous India in line with the Hindutva or even Thailand or South Korea’s own efforts to establish themselves as regional powers backed by immense economic, industrial, political, and an increasing strategic capacity, these nations are serious about achieving their objectives.

These ambitions have been characterised by vast, long-term infrastructure programs, industry development policies and plans that build generational wealth and prosperity as the Western world reveled in the triumphant hysteria following the collapse of the Soviet Union and the ensuing “End of History”.

The advent of the post-Cold War globalised world order and the opening up of China, championed by Richard Nixon and then kicked into overdrive by Deng Xiaoping’s reformist government — supported by the proponents of neoliberal economics like Ronald Reagan and Margaret Thatcher — rapidly accelerated the deindustrialisation of the United States and broader Western world.

Ensconced in the protective cocoon of the post-Soviet world and well into the21st century, many nations, including Australia, largely said goodbye to their manufacturing and industrial capabilities. Nowhere is this better reflected than in the Harvard University’s Atlas of Economic Complexity which identifies that Australia ranks 91st out of 133 studied nations.

As part of this analysis, the Harvard atlas articulates, “Compared to a decade prior, ⁨Australia’s⁩ ⁨economy has become less complex, ⁩⁨worsening ⁩⁨⁨eight⁩ positions in the Economic Complexity Index (ECI) ranking⁩. ⁨⁨Australia’s⁩ worsening complexity has ⁨been driven by a lack of diversification of exports⁩.⁩ Moving forward, ⁨Australia⁩ is positioned to take advantage of ⁨a moderate number of⁩ opportunities to diversify its production using its existing knowhow.”

Perhaps most startling is the following statement, “⁨Australia⁩ is ⁨less complex than expected⁩ for its income level. ⁨As a result, its economy⁩ is projected to grow ⁨slowly.⁩ The Growth Lab’s ⁨2030⁩ Growth Projections foresee growth in ⁨Australia⁩ of ⁨2 per cent⁩ annually over the coming decade, ranking in the ⁨bottom half⁩ of countries globally.”

But what does this have to do with short-termism and policy making in this new era of great power competition? Well, simply put, this lack of economic diversity, complexity, and capacity has dramatic implications on our long-term prosperity and accordingly, our long-term national security.

Economic competitiveness, complexity key to prosperity and security

Historically, Australia’s economy has been largely defined by the export of the continent’s vast resource reserves and the agricultural booms, both of which have, in recent decades, been buoyed by the voracious demands of the Indo-Pacific and Middle East, namely China.

This comforting security blanket, flanked by education and services, has kept the Australian economy from spiralling into recession multiple times over the last two decades, propelling our per capita wealth and pushing the Australian real estate market into overdrive, enticing much of the Australian public into a sense of false security over the resilience, strength, complexity, and vitality of the national economy.

While the pandemic era did, in some ways, startle many leaders and the public across the globe into the frailty of “just in time” supply chains and the perils of offshoring major industrial capacity, for Australia, the lessons learned during the COVID-19 pandemic seem to have reverted to becoming mere playthings in political debates, all the while as the chickens of unrestricted quantitative easing come home to roost, driving surging inflation and cost of living across the Western world.

Despite successive Australian governments of both persuasions seeking to expand Australia’s integration and participation in the economic miracle that is the rise of the Indo-Pacific — China has continued to dominate the nation’s economic narrative from the housing sector to agriculture and resources and energy — often to the detriment of relationships with regional nations that approach Beijing with a degree of caution.

Furthermore, Australia’s insistence on pursuing “free trade agreements” with nations that have additional layers of legislative and bureaucratic industry protections, combined with successive governments presiding over the death of Australia’s manufacturing sector and a reluctance to invest in advanced manufacturing techniques, has prompted Australia to become little more than a mine and farm for the rising powers of Indo-Pacific Asia and the very embodiment of the lazy country moniker, which author Donald Horne originally intended the “Lucky Country” to be known as.

Addressing these issues is now of paramount importance for Australia, in particular, as we face an increasingly multipolar global paradigm where the economic, political, and strategic power of our “traditional, great, and powerful friends” is relative when compared to the rising global and regional powers, each with their own interests, designs, and ambitions for the new world order.

Highlighting the need to rapidly respond to these challenges, Dr Ross Babbage of US think tank Center for Strategic and Budgetary Assessments, speaking to Defence Connect in an upcoming podcast detailing his new book The Next Major War, highlighted the need for Australia to step up its game.

“In 2000, US manufacturing output was over double that of China. But by 2020, China was almost double that of the United States and that is because the United States and its allies, including Australia, we’ve exported our industries, and made ourselves uncompetitive, and reduced our manufacturing capacities. So you know, we really de-industrialised and the costs for that in a crisis are really serious,” Dr Babbage explained.

Adding to this, Dr Babbage highlighted that the path moving forward for Australia and the broader Western alliance network will be radically different to the system and structures established during the Second World War which saw the United States establish itself as not only the world’s greatest industrial power, but as the “Leader of the Free World” and the “Arsenal of Democracy”.

“It’s going to mean a different model, the United States won’t be able to do it on its own, it’s going to need much more coalition cooperation. And if you’d like non-Chinese industry cooperation, and in a way that we haven’t seen, probably ever, and that needs new mechanisms, and it needs new, important cooperative understandings, particularly between the democracies, not only in East Asia, but also countries like India, but also into Europe,” Dr Babbage explained.

Highlighting the path ahead, Dr Babbage stressed the importance of a fundamental rethink in the way in which Australia, in particular, approaches the challenges and opportunities of the coming decades, particularly on the industrialisation front, telling Defence Connect, “It is really critical that we make ourselves more competitive. And many Australians have forgotten that, you know, for us to be prosperous and fully employed, and have good futures for our children and so on, then, competitiveness really is critical to our success, otherwise, we’re going to be an economic backwater. And we’ll be very vulnerable in international security terms as well, and much more dependent upon other countries for our security. So we have to get more efficient and effective and more competitive, we have to attract more foreign investment and our own investment, to do sensible things in this country.”

We all need to pull together

Australia, like much of the developed world, is facing the challenges of an ageing population, coupled with younger generations disconnected and uninvested in the future of the nation, resulting in hesitancy to defend the nation’s values, principles, and interests at home and abroad. This new realm of warfare across the societal, political, and information domains has had a dramatic impact on the resilience and outlook of many young Australians.

Bringing the Australian public along on the journey and highlighting the challenges and opportunities is a critical mechanism for alleviating fear and concerns about the evolving geopolitical dynamics and the broader implications on the average Australian’s safety, prosperity, and stability.

Dr Babbage highlights this echoing similar sentiments to Strategic Analysis Australia’s executive director, Peter Jennings AO, telling Defence Connect, “I think we really got to do a much, much better job about giving, telling the truth, basically, telling people what’s actually going on. You know, I’m sure you won’t be upset with me if I say that much of Australia’s media and for that matter, Western media, generally has not done a wonderful job of explaining what’s going on in China, and what they’re actually doing.

“If, in a crisis, this, the sort of crisis we’d now might face, it’s not going to be the military that are going to be winning the war, if you like, on their own, they are very, very important. But it’s going to be all of society, this is going to be, it’s going to involve just about everybody. We will all be involved. The sooner we tell the public and the sooner we brief people properly, and the sooner we have discussions and debates about these issues, the better. I’m very confident that the Australian public’s gut feeling on this would be very standard and sensible. But I think the reality is that, unfortunately, some politicians in the United States, and certainly also in Australia, they do not want this stuff talked about,” Dr Babbage explained.

Importantly, bringing Australians along on this journey requires a common, uniting and exciting vision of the future for the nation despite periods of upheaval and change rapidly transforming the global economic, political, and security paradigm around us.

Dr Babbage said, “I think what we’ve got to show what’s the vision for Australia, you know, what can we achieve and what you know if we go on the trajectory we are on at the moment. I’ll tell you what, you know, a lot of people, a lot more people in a decade’s time are likely to be either in really dumb jobs or maybe not have jobs at all, and in the society be a lot weaker and will be a lot less prosperous.

“So what we want to say is, look, there’s plenty of scope for doing more and smarter things, encouraging investment to do that, and then there will be some very, very interesting additional jobs and opportunities, a lot of high tech, and so on, I can tell you that, you know, talking to foreign investors, they’re quite keen on principle to work here, and do a lot more here and provide a lot more good jobs for Australians,” he explained.

Final thoughts

Importantly, in this era of renewed competition between autarchy and democracy, this is a conversation that needs to be had in the open with the Australian people, as ultimately, they will be called upon to help implement it, to consent to the direction, and to defend it should diplomacy fail.

This requires a greater degree of transparency and a culture of collaboration between the nation’s strategic policymakers and elected officials and the constituents they represent and serve — equally, this approach will need to entice the Australian public to once again invest in and believe in the future direction of the nation.

Equally, it is important for us to recognise that while we don’t face these challenges in isolation, each and every nation is and will put its own interests first, the COVID-19 pandemic proved that, therefore we can no longer afford to be blindly altruistic in our approach to the nation’s future, to do so is willful ignorance at best and national vandalism at worst.

If we are going to emerge as a prosperous, secure, and free nation in the new era of great power competition, it is clear we will need break the shackles of short-termism and begin to think far more long term, to the benefit of current and future generations of Australians.

The full podcast interview with Dr Ross Babbage will be available shortly.

Get involved with the discussion and let us know your thoughts on Australia’s future role and position in the Indo-Pacific region and what you would like to see from Australia’s political leaders in terms of partisan and bipartisan agenda setting in the comments section below, or get in touch This email address is being protected from spambots. You need JavaScript enabled to view it. or at This email address is being protected from spambots. You need JavaScript enabled to view it..

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