Flat White

Bill borrows from Trump’s protectionist playbook

21 February 2017

7:34 AM

21 February 2017

7:34 AM

Donald Trump’s ascendancy has provided ample fodder for left-leaning politicians, GetUp! and other aggrieved members of the activist class seeking to claim the Turnbull-led Coalition is intent on taking a right-wing wrecking ball to the core of Australian civil society.

Yet it is Bill Shorten, not Malcolm Turnbull, who has taken his lead from the Donald’s playbook.

Shorten started the year by joining West Australian Labor leader Mark McGowan to back the opposition’s push to scratch Perth from the skilled migration list and spruik Labor’s ‘Australia first’ jobs policy. Standing shoulder to shoulder with his western counterpart, Shorten bewailed that it was easier to bring in guest workers than ‘give Aussies first crack at the jobs.’ McGowan nodded, pledging to ‘rip up’ the list of skilled occupations able to fast-tracked into Australia to ‘reflect the reality of Western Australia.’

This same pitch about big business taking the low road and handing out jobs to cunning foreigners over Aussies has been top of Shorten’s talking points since November 9. In those early hours, while progressive high society from Ultimo to Manhattan was still spinning in a Trump-induced torpor, Shorten’s rejoinder was wily and swift: “We will buy Australian, build Australian, make in Australia and employ Australians.”

It’s a ploy well oiled for the once thriving western economy that now finds itself in the midst of a post-mining boom funk. Property prices are in steep decline, unemployment is up and despondence in one-time boomtowns of Kalgoorlie, Pilbara and Kimberly is thick on the ground. Adding insult to injury, a beer in Perth’s CBD still costs $11.50.

But Shorten’s cure for what ails the west is not better than snake oil. The cynically titled ‘Migration Amendment (Putting Local Workers First) Bill’ would see businesses saddled with more burdensome job advertising requirements and a crackdown on job ads that set ‘unrealistic’ or ‘unwarranted’ skills or experience which may exclude Australian workers, and grant government a veto over businesses seeking to employ temporary migrants as more than 15 per cent of their workforce.

The little-known truth is that sponsoring a 457 visa is already more than onerous enough to deter bosses gratuitously snubbing the local market. With the process costing between $17,000 and $56,000 a pop, it already costs more to bring skilled migrants into Australia than New Zealand, Canada and the lion’s share of European countries. Businesses are forced to shoulder the cost of airfares, language tests and medical care. A single company is authorised to conduct mandatory language tests, often resulting in delays of up to eight weeks just to assess whether a prospective entrant has a basic grasp of the English language.

The Government’s 2014 review into the system concluded it was unwieldy and complex while producing no benefit to out-of-work Australians. Quite so – it stretches credulity that even the most foolhardy employer would go to the lengths of sponsoring a foreign worker while suitably trained locals were left waiting on the bench.

Yet in spite of the regulatory quagmire, skilled foreign workers sponsored on 457 visas have been our economy’s quiet achievers for the last several decades. Deloitte Access Economics has found that every 1,000 457 visa arrivals deliver $25 million for the Australian economy in just two years. Among the 9 major immigrant categories, 457 visa holders delivered the second highest GDP boost per capital. Just as our mining industry relies on intricate machinery made abroad to fully capitalise on our natural wealth, skilled migration helps plug the gaps in our domestic store of human capital.

Far from snaffling an undeserved slice of Australia’s economic pie, the vast majority of foreign workers pay tax in the upper brackets without receiving a jot of government health and welfare spending. More than that, their earnings flow back into our own economy, growing our national wealth and in turn, creating more local jobs.

Perhaps the greatest myth behind Shorten’s 457 fear mongering is that a job taken by a foreign worker means an Aussie has been shafted to the back of the line. In truth, the alternative may well be no job at all.

Consider, for instance, the fact that sending IT operations offshore has been low hanging fruit for Australian businesses looking to cut costs. Making the process of hiring the foreign IT gurus who make up 15 per cent of our 457 visa intake even more punishing is a move that will see this trend steepen. The same goes for workers in marketing, engineering and the other specialist business occupations that take up a sizable chunk of our skilled migrant intake.

The cruel irony of all this is that the very workers Shorten proclaims a desire to help will be the ones who foot the bill of his Australia First fantasy.

On steel, Shorten has committed on behalf of taxpayers to bankrolling a South Australian steel mill that produces the commodity less cheaply than five of the world’s six other continents. Not content, Shorten now wants to force Government projects to buy local even when the sums aren’t close to adding up. In 2014, Shorten gave every indication he wanted to pump more public funds into a car manufacturing sector already subsidised to the tune of over $50,000 per worker each year. He’s now affecting Trump’s trademark disdain for free trade, dismissing the TPP as a frolic and vowing to ‘run the ruler’ over future agreements to make sure they put ‘Australia first.’

It’s a proto-nationalist agenda designed to buy political capital at the cost of making our entire nation poorer.

Contrary to the zeitgeist of Fairfax opinion pages, Trump’s anti-globalist, pro-protectionist posture is easily the most dangerous part of the new President’s agenda. It’s a fantasy that looks back with blinkered romanticism at the days of the nineteen-fifties when a car manufacturing job in the now mendicant Midwest could house and feed a family of four. Yet swept up in the nostalgia is the awkward fact that the cost of buying a refrigerator, television or myriad other household consumables equated to more than eight times as many work hours than it does for autoworkers today.

By touting economic superstitions that belong to the age of the Dodo, Shorten sharpens the already stark contrast between himself and the Labor leaders of yesteryear. Whereas Hawke and Keating recognised that a free trading, open economy was Australia’s passport to a share of the world’s wealth, Shorten harks back to an era when the union movement fought to confine our economy to our own backyard.

Shorten says Labor “will heed the lessons of Detroit, Michigan, of Ohio and Pennsylvania. We’re not going to lose our blue-collar voters like the Democrats did.” On that score, ditching Labor’s 50 per cent renewable energy target and scrapping safe schools would be a far more auspicious place to start.

John Slater is Executive Director of the H.R. Nicholls Society.

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