Let's consider a positive-sum economy. Over time, the total amount of value in the economy grows. That additional value comes from innovation, but whose innovation?
I grew up in Australia, in the state of New South Wales. In the end-of-secondary-school exams, the most popular subject in NSW is English, because it's compulsory. The second most popular subject is Business Studies. There's an awful lot of entrepreneurial spirit there.
But the reality of the Australian economy is that its complexity is declining: the economic activity is ever more concentrated into fewer and fewer industries. Sure, there are some industries, like hospitality, where you can start your own business, but the bulk of the economy is dominated by a small number of large companies: a handful of mining companies, two supermarkets, and so on. Every now and then, there's a new government initiative, like the National Disability Insurance Scheme or the opening up of vocational training to private providers, and a few years later, there's a big scandal, because most of the companies providing these services turn out to be fraudulent. So much of Australia's economic activity is tied up in pre-existing businesses that it seems that the only way to do anything novel is to rip off the government.
There was a time when Australians started innovative businesses: Victa lawn mowers, the Hills Hoist clothes line, and so on. Ford Australia and Holden (owned by General Motors) competed to build the best cars for the Australian market. This was a time of optimism and increasing living standards, when impoverished workers were enticed to emigrate to Australia by the Great Australian Dream: a detached house and a car of your very own!
But now that airfares a cheap, talented Australians emigrate to the UK, the US, or the EU, and do their innovative work there. Thanks to tax breaks, the best possible investment you can make in Australia is to own someone else's home. The population is increasing faster than ever, but housebuilding is slowing down. The housing crisis has been building for twenty years now; anger turns to ennui. A belief that Australia has no future is slowly starting to coalesce. Australia has entered a zero sum death spiral.
The solution is to create an economy where the old bootstraps analogy actually holds: where simple, honest hard work actually improves one's lot in life. An economy where anyone can innovate, not just university graduates with millions in venture capital funding: the economy that the Baby Boomers grew up in.
If only we knew how to create those conditions without having to fight a world war first.
"If only we knew how to create those conditions without having to fight a world war first."
Funnily enough, zero-sum thinking would provide a solution for this.
In order for your society to thrive, opportunity must be created. If nobody knows how to create sustainable (read, not based on subsidy) opportunity, it can always be manufactured at the cost of a target group. (Ethnic groups, 'the rich', other countries, etc. Pick your favorite.)
In terms of a housing shortage, you can create housing for your 'team' by taking existing houses from those who aren't on your 'team'.
In business or in academia, you can force hiring or admittance practices/rules/quotas that prioritize your 'team' over other 'teams'.
There lies the crux.
There is always gain to be had by those who simply choose to take it.
Even the promise of a world order where such choices are unthinkable isn't protected. All it takes is one group who chooses to prioritize themselves, and then if the remaining group is not strong or numerous enough to fight them off, a new order is established and equity is abolished in favor of a new dominance hierarchy.
In a globalized world, Richard's Law of comparative advantage tells us that the economic activity in each country will increasingly be concentrated into fewer industries. For example, it would no longer make sense to build cars in Australia if Mexico can do it better and cheaper.
This trend might reverse a bit. Populist tariffs and increasing transport costs are generally driving up the prices of imported goods in many countries.
Almost everything you have written here can also describe Canada. There is an Australian YouTuber named Chris Kohler who does really funny little shorts describing things happening in the Aussie economy and it’s jarring how often they apply directly to Canada also.
IOW you're just doing what the US has been doing for the last 30 years or so - shipping your "real" economy to China. Until that changes, Australia indeed doesn't have a future. The economy baby boomers grew up in isn't coming back, unless you're willing to tolerate a few years of a world war, and your continent is spared the consequences.
I grew up in Australia, in the state of New South Wales. In the end-of-secondary-school exams, the most popular subject in NSW is English, because it's compulsory. The second most popular subject is Business Studies. There's an awful lot of entrepreneurial spirit there.
But the reality of the Australian economy is that its complexity is declining: the economic activity is ever more concentrated into fewer and fewer industries. Sure, there are some industries, like hospitality, where you can start your own business, but the bulk of the economy is dominated by a small number of large companies: a handful of mining companies, two supermarkets, and so on. Every now and then, there's a new government initiative, like the National Disability Insurance Scheme or the opening up of vocational training to private providers, and a few years later, there's a big scandal, because most of the companies providing these services turn out to be fraudulent. So much of Australia's economic activity is tied up in pre-existing businesses that it seems that the only way to do anything novel is to rip off the government.
There was a time when Australians started innovative businesses: Victa lawn mowers, the Hills Hoist clothes line, and so on. Ford Australia and Holden (owned by General Motors) competed to build the best cars for the Australian market. This was a time of optimism and increasing living standards, when impoverished workers were enticed to emigrate to Australia by the Great Australian Dream: a detached house and a car of your very own!
But now that airfares a cheap, talented Australians emigrate to the UK, the US, or the EU, and do their innovative work there. Thanks to tax breaks, the best possible investment you can make in Australia is to own someone else's home. The population is increasing faster than ever, but housebuilding is slowing down. The housing crisis has been building for twenty years now; anger turns to ennui. A belief that Australia has no future is slowly starting to coalesce. Australia has entered a zero sum death spiral.
The solution is to create an economy where the old bootstraps analogy actually holds: where simple, honest hard work actually improves one's lot in life. An economy where anyone can innovate, not just university graduates with millions in venture capital funding: the economy that the Baby Boomers grew up in.
If only we knew how to create those conditions without having to fight a world war first.