Lead Story
Issue No. 29 - June/July 2006
Economic evolution – a [big ] picture
by Professor Richard Blandy
In this article, I want to provide an overview of the big economic issues facing Australia and South Australia.
It is handy to do this now, at the start of a new four-year term for the Rann Government. The South Australian Strategic Plan is being reviewed, culminating in a Community Congress on 8 July, so this is a good time to be thinking about the main issues confronting us collectively.
It is worth noting that the most important economic outcomes are all agreed by the community and the relevant political players, namely:
- high employment,
- high and growing incomes and living standards, and
- an equitable distribution of income and living standards.
The big issues emerge over how to achieve these agreed objectives, not over the objectives themselves — although there may be differences over the precise meaning to be given to each objective.
Differences over how to achieve our agreed objectives arise because of
- differences in people’s understanding of how the economy works, and
- changes in the economic, political, social, environmental, ideological and other circumstances in which we find ourselves.
Differences in people’s understanding of how the economy works can be put aside nowadays as a major cause of differences in how to achieve our objectives, because, with the intellectual demise of Marxist and Keynesian economics, there is only one important understanding left of how economies work — what has been called “the neoclassical synthesis”.
But changes in our circumstances (to which we must adjust) are always occurring.
The biggest changes in our circumstances that have occurred over the last quarter of a century, that are occurring, or that may occur are:
- the ideological victory of capitalist, liberal democracy over other ideologies,
- globalisation,
- climate change, a...
