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IN A DETERIORATING ECONOMIC ENVIRONMENT, THE GOVERNMENT HAS BEEN PINNING ITS HOPES ON THIS STATEMENT TO RESCUE ITS POLITICAL AND ECONOMIC CREDIBILITY. BUT, BECAUSE OF A TORRENT OF LEAKS OVER E LAST FEW WEEKS, THE PACKAGE CONTAINED NO MAJOR SURPRISES.
8.
THE PACKAGE IS HOWEVER A SIGNIFICANT FURTHER STEP TOWARDS COMPLETION OF THE DEMOLITION OF AUSTRALIA'S TARIFF BARRIERS. IT SHOULD BE SEEN AGAINST THE BACKGROUND OF AN ECONOMY WHOSE STRATEGY WAS UNTIL RECENTLY BASED ON NURTURING A MANUFACTURING SECTOR THROUGH HIGH TARIFFS AIMED AT PROVIDING JOBS FOR A GROWING POPULATION. THE NEW TARIFF REDUCTIONS MEAN THAT BY THE END OF THE CENTURY GOVERNMENT ASSISTANCE TO MANUFACTURING WILL HAVE BEEN CUT BY 75 PER CENT IN 20 YEARS. THE AIM IS TO LOCK AUSTRALIA INTO THE WORLD ECONOMY, PARTICULARLY THE DYNAMIC COUNTRIES OF THE PACIFIC RIM.
9. THE PACKAGE REPRESENTS A VICTORY FOR THE GOVERNMENT'S ECONOMIC RATIONALISTS WHO HAVE SUCCESSFULLY RESISTED PRESSURES FOR A SLOWDOWN IN TARIFF REDUCTIONS. IN RESPONSE TO THE CALLS FOR SELECTIVE INTERVENTION TO PROMOTE PARTICULAR INDUSTRIES, IT CONTAINS ONLY CRUMBS. DESPITE BEING ASSISTED BY LOWER INPUT COSTS ARISING FROM THE TAX CHANGES, THE PACKAGE WILL INCREASE THE PRESSURE ON AUSTRALIAN INDUSTRY TO IMPROVE ITS EFFICIENCY AND TO SEEK NEW MARKETS. THE LABOR PARTY KNOWS IT IS RISKING A BACKLASH FROM ITS OWN SUPPORT BASE WHERE THERE IS A FEAR THAT REDUCED PROTECTION WILL MEAN HIGHER UNEMPLOYMENT AND SEVERE DISLOCATION.
10. THE MAIN WEAKNESS OF THE PACKAGE LIES IN WHAT IS EXCLUDED, PARTICULARLY THE ABSENCE OF MEASURES TO ACCELERATE MUCH-NEEDED INFRASTRUCTURE REFORM IN SUCH AREAS AS THE WATERFRONT AND COASTAL SHIPPING. IN RESPONSE TO THIS CRITICISM HAWKE POINTED TO THE PROGRESS WHICH WAS ALREADY UNDER WAY AND CHALLENGED HIS OPPONENTS TO SHOW HOW FASTER REFORM COULD BE ACHIEVED WITHOUT POISONING THE BETTER INDUSTRIAL RELATIONS AND INDUSTRIAL ENVIRONMENT WHICH HIS GOVERNMENT HAD CREATED AND BRINGING THE WHOLE PROCESS TO A GRINDING HALT. BUT DOUBTS REMAIN ABOUT WHETHER THE PACE OF CHANGE IS FAST ENOUGH AND MANY COMMENTATORS ARE ASKING WHY, IF THE GOVERNMENT HAD THE COURAGE TO MOVE ON PROTECTION, IT COULD NOT HAVE SHOWN EQUAL COURAGE BY ACCELERATING THE TIMETABLE FOR THE ACHIEVEMENT OF MICRO-ECONOMIC REFORM.
MACKLEY
YYYY
ΜΑΙΝ
177
CULL
176
SPD [-]
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[CARRUTHERS]