The last 12 months has illustrated the importance of self-reliance. When a country cannot rely on itself then its sovereignty is jeopardised. In his political masterpiece The Prince Niccolo Machiavelli wrote:
Wise princes … have always shunned axillaries and made use of their own forces … in the belief that no true victory is possible with alien arms.
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Mercenaries and auxiliaries are … useless and dangerous.
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If a prince bases the defence of his state on mercenaries, he will never achieve stability and security.
At the time of writing, Machiavelli was lamenting the downfall of the Italian state, which in his opinion had been caused by the reliance placed on mercenary troops for so many years. Australia today in many ways resembles Machiavelli’s Italy. We rely on foreign auxiliaries for so many of our core responsibilities: defence, capital, labour and manufacturing. The fake meme of an Australian soldier on Twitter last year showed why we can never trust foreign companies to defend our national interests if it is against their vested interest. Self-reliance is the bedrock of sovereign independence.
It is my view that there is too much focus on trade and not enough focus on production. While trade is obviously important for a country like Australia, it is no substitute for the ability to control our means of production. In the same way the horse comes before the cart, production must always come before trade. What is the point of generating wealth if it is to end up in an offshore bank account? There is no future for our children if they cannot control the means by which wealth is generated and, more importantly, do not know how to generate the wealth in the first place. True liberty is the ability to stand on your own two feet and not have to depend on others. If Australia is to remain a truly sovereign nation and not become a vassal state of multinational corporations, we must ensure control of our wealth and be responsible for the tasks that underpin any nation’s sovereignty, in particular our infrastructure that provides essential services to Australians. I’ve spoken about this many times before; infrastructure built and paid for by Australian taxes should be controlled by Australians. To those that say Australia has always relied on foreign capital, I say think again. As the words of our national anthem state, it is ‘wealth for toil’, not ‘wealth for foreign debt’. Using foreign debt to fund our way of life only begets more debt and, with it, the loss of control over our nation’s wealth and the high standard of living that comes with it. Ultimately, debt becomes slavery, and we owe it to our children not to enslave them with the burden of debt.
Few people seem to understand that borrowing from offshore drives up the Australian dollar as foreigners swap their currencies into Australian dollars before lending those very dollars back to us. This is counterproductive for Australian industry as the higher dollar makes it harder to export goods and easier to import goods. As a sovereign nation, Australia has the sovereign right to issue its own credit against our untapped wealth. It does not need to outsource this responsibility to foreign central banks by taking on foreign debt. Australia has the sovereign rights to the rainfall, to the sunlight, to the materials and to the toil that are needed to produce its own goods and services. From an accounting perspective, those sovereign rights are already equity. So why give up title over that wealth in exchange for a mortgage that enslaves our children? The quantitative easing being pursued by the RBA should focus on building infrastructure to increase production, rather than consuming foreign goods. It is time that the RBA and the Foreign Investment Review Board put an end to foreign companies turning up with a truck full of free cash supplied by foreign central banks to steal our infrastructure.
The same goes for foreign labour. The skills shortage in Australia is yet another threat to our sovereignty, and it’s not just fruit picking. Boilermakers, diesel mechanics and various other trades are in short supply. It is a sad indictment of our overreliance on foreign labour that Australia, a First World country, has to rely on skilled labour, especially doctors, from developing countries.
As the saying goes: give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime. There is no better way to learn than being in an actual job. Yet today Australians are determined to send all of our children off to university when, in fact, many of them would be better off doing a trade. Too many young people are graduating from university with massive debts but no employment prospects in their studied profession, while businesses have to import labour to fill skills shortages. While education is important, we should remember the saying: those who can, do; those who can’t, teach. In recent decades, higher education has become driven by profit and ideology rather than skills and productivity, and it is our children who have suffered for it.
Our skills base is further eroded when corporations offshore jobs, further jeopardising our sovereignty. Australia has seen too many of its corporations move their head offices offshore. BHP and Rio are just two of the many that have moved offshore despite the fact that most of their wealth is generated here in Australia. In the main, this is driven by our tax act, which encourages the offshoring of both labour and profits. This has had a devastating impact on our industries, especially manufacturing.
Multinational corporations are the mercenaries of the 21st century. The threat by Google over the Australian government’s desire to tax news content is just one of the many examples of how these corporations act with undemocratic belligerence to undermine our sovereign rights. Our tax treaties work against the national interest. Allowing foreign entities to transfer their profits offshore at a lower rate than the onshore tax rate has gifted them a competitive advantage, to the detriment of Australian industries and jobs. Withholding taxes on profits need to be lifted in order to reduce the arbitrage between profits retained in Australia and profits sent offshore. Too much of our wealth is being transferred offshore.
Finally, any discussion about sovereignty shouldn’t ignore the High Court case of Commonwealth v Tasmania, which put the rights of international treaties above those of state governments. The Constitution says that the federal government has the power to make laws with respect to external affairs. Can somebody please explain to me how dam building is an external affair? It isn’t. It is a domestic affair. You can’t tell me that protectionists like Deakin and Barton had dams in mind when they inserted the external affairs powers into the Constitution. This decision needs to be overturned.
Australia, as a small, isolated country in the South Pacific, must put national self-interest in front of vested interests driven by false ideologies. We should not be a servant to trade but rather a master of production, or, like so many states before, we will fall to mercenaries who are loyal only to their vested interests. To achieve this, we must rewrite our international treaties, especially our tax treaties; control the flow of capital that crosses our borders; and teach our children trades rather than just ideologies. Australia should heed the words of Lord Palmerston, who said:
We have no eternal allies, and we have no perpetual enemies. Our interests are eternal and perpetual, and those interests it is our duty to follow.