Left ignores history, locks us into a doom loop
Without a knowledge of history, it is impossible to understand why the public and their leaders in different societies think what they think and do what they do. More than that, without an understanding of history, we are doomed to repeat the mistakes of the past and learn nothing from experience. Cicero said: “Not to know what happened before you were born is to remain a child.”
History is not an ornament, it’s a warning. As Sir Robert Menzies said: “Any man … who is unaware of what went before him, unaware of the great truths that have come down to him, is a foolish man. He is essentially, a shortsighted man.”
Of course, to understand history, it’s necessary to read books. I know that’s decreasingly fashionable. Perhaps my Melbourne businessman might like to go to a bookstore. All of Australia’s few great leaders have had a clear understanding of history. Deakin, Menzies, Hawke and Howard all knew a great deal about not just Australian history but the history of our civilisation.
It is a lack of knowledge of history, including modern history, that is increasingly getting us into trouble. Let’s take economic policy. Everything has been tried before, both in Australia and in many other countries around the world. These days our politicians, state and federal, have seized control of the most important single component of the economy, energy.
They have redirected resources away from the most economically viable forms of power generation into their preferred models. It’s hardly surprising that politicians of the left who believe the government should control people’s lives and their economic decisions find climate change interventions more attractive than liberally minded politicians who believe in concepts such as individual choice and freedom to invest and make a profit.
These models have been tried before albeit without the fantastic ambition of changing the climate. And in every case, they have failed. In the UK in the 1960s and ’70s the government increasingly took control of economic activity. It eventually had to be bailed out by the IMF. It is what happened on a more tragic scale in Argentina from the mid-1950s onwards. And above all it was the model used by the Soviet Union and the Eastern Bloc until 1991.
The doom spiral
The result is inflation, spiralling public debt, higher interest rates, slower economic growth and, ultimately, fewer resources to hand out to people in genuine need. History tells us these societies get into a doom loop. The government tries to control inflation by regulating prices. It borrows from international financial institutions or reneges on its debts altogether. It controls interest rates. The result of all these interventions, and many thousands of regulations introduced to control society, is lack of economic dynamism, lack of growth and eternal poverty.
Or looked at another way, the societies that have prospered have been societies that have opened their economies, allowing hardworking, entrepreneurial people incentives to invest and create products that the public both wants and can afford. Eastern Europe, liberated from socialism, has achieved high rates of economic growth. Singapore, which is Southeast Asia’s most open economy, is also Southeast Asia’s richest. Or let’s look at history in the 19th century when Britain allowed its entrepreneurs to invest in ever-improving technology. Workers’ wages doubled between 1850 and 1900.
Today, we are making all the mistakes that a knowledge of economic history would teach us to avoid. We are increasing public debt, thereby chewing up more of our taxes simply paying interest on government debt.
We are, day by day, increasing regulations for individuals and businesses in order to achieve various fantasy objectives such as changing the weather. Most importantly, we have set up a dual energy system, with intermittent energy being supported by under-utilised traditional fossil fuel energy.
Any knowledge of economic history would teach you that the great achievement of the 19th century was the huge reduction in energy prices.
History also teaches us to understand geopolitical problems. China’s aggression in the South China Sea is a function of what China’s leadership sees as the century of humiliation when Western powers were able to control China by blockading its ports.
That’s not to justify China’s absurd demands for sovereignty across the whole of the South China Sea, but it does explain why it thinks that way. Equally, Russia’s aggression towards Ukraine is a function of history and not just recent history. Russia has been invaded from the West by Swedes, Lithuanians, the French, Germans and Austrians. Given that history, it is not surprising that Russia has some distrust of the West although we find it incomprehensible that it fears a further invasion now. That helps explain why the Russians, particularly President Vladimir Putin himself, regrets the loss of the Soviet empire.
The Soviet Union, and particularly the Eastern European communist regimes, provided Russia with a buffer. The expansion of NATO to include the Baltic republics and former communist countries such as Poland, Romania, and Bulgaria was seen in Moscow as a huge geopolitical setback.
These things need to be taken into consideration when negotiating with Russians, as the Americans currently are in their efforts to try to end Ukraine war.
In our own neighbourhood, Southeast Asian countries (with the exception of Thailand) were colonised by European powers. The independence movements since the Second World War have driven their perceptions of the West and have had some influence on the way they have seen Australia. They are countries determined not to be dominated by foreign powers, be they Western powers such as the United States or, importantly, China. So there you have it. It’s not possible to understand the modern world without understanding its history.
But at the same time, if we understood our history better – particularly if our journalists and politicians understood history better – then they would avoid making the mistake of failing to learn from history. Or, to use another phrase, to learn from experience. A fool never learns, a clever person learns from experience, but a wise person learns from the experience of others.
A prominent Melbourne businessman recently told me that history was irrelevant. We don’t need to understand the stories of old men and women long dead to address our current social and economic challenges. Not only is this view completely wrong, but it reveals a tragic lack of understanding of why not just our country but the world works as it currently does.