Thriving businesses feed a rising economy for all

The International Tax Agreements Amendment Bill would barely have rated a mention on the ABC were it not for a clever stunt by the Revenue and Financial Services Minister to force it to the top of the bulletin.

Last week’s obsessive coverage of a bungled vote, on an inconsequential amendment that was quickly corrected, was a measure of the bias in political journalism towards theatre over substance.

A “red-faced” (my, how they love their cliches!) Kelly O’Dwyer is the story, apparently, not the legislation itself despite its potential consequences for business and the broader economy.

Climate is a matter of great moment to the media class, depending on what sort. The Category 5 hurricane that hit the Florida coast last week — the first, incidentally, for nine years — was reported with apocalyptic delight.

When it comes to the business climate, however, the temperature of which will have a material effect on our mutual prosperity, the best we can expect from the bulk of the media class is indifference.

Take the ABC’s The World Today, for example. Of the 70 or so people appearing on the program last week, fewer than a dozen worked in the private sector. The radio current affairs flagship offered platforms to the usual cast of journalists, politicians, academics, medical researchers and activists, all of whom draw their main income from the public purse.

In the joyless world of the ABC’s current affairs department, industry is cast most often as the villain. The case of a coal miner who contracts cancer is discussed for two days in a row. In other news, environmental activists celebrate the end of mineral explor­ation in the Great Australian Bight and indignation is running hot at the behaviour of banks.

Outside the pages of The Australian and The Australian Financial Review, there is little acknowledgment that wealth ever needs to be created but plenty of attention is given to how it should be distributed.

A quick quiz makes the point: Which report was not covered by The World Today last week? Was it A: the one by the Mary MacKillop Institute for Health Research demanding government action in response to a cardiovascular “crisis” among women? Or B: a report by the Centre for Independent Studies showing why a cut in company tax will boost business investment?

It is against this dismal backdrop that we must measure the frequent complaint that business groups such as the Business Council of Australia are not fighting for their cause. Yet when the appetite for such discussion is somewhat less than zero on the state-sponsored national broadcaster, a forward-leaning business council has an uphill task.

The contagion of journalism by critical theory means their contribution almost certainly would be dismissed as the self-serving arguments of powerful vested interests. The test of validity in journalism was once the truth of what was said; today it’s the supposed moral worth of the person who is saying it.

The arguments of unionists, campaigners for environmental causes, crusaders against animal cruelty, upholders of minority rights and dozens of other progressive causes are, with rare exception, treated as entirely altruistic. The fact a multi-million-dollar operation such as Greenpeace has a vested interest in provoking environmental alarm seldom seems to enter their head.

As to business, well, they would say that wouldn’t they. And besides, why should business get a platform to talk up its shop when the Liberal Party is doing it for them. It is, isn’t it?

Well, no, actually. Not if it is doing its job. The party’s founder, Robert Menzies, was quite clear on this point; the party’s task was neither to defend the big end of town nor the organised workforce, who were quite capable of looking after themselves.

The Liberal Party’s natural constituency was the forgotten people, “salary-earners, shopkeepers, skilled artisans, professional men and women, farmers”, the unorganised and unselfconscious economic middle class. Indeed, there are times when Liberal principles demand that business be slapped down.

Good public policy does not ­always coincide with the interests of individual businesses. No corporate leader would be crass enough to oppose competition policy, but few actually relish competition. The government’s job, said Menzies, was more than just putting ropes around the boxing ring; it must also referee the fight.

Above all, no government should ever forget that its prime economic role is to create a climate in which enterprise flourishes. “No act of parliament can make a nation prosperous,” said Menzies. “It is the energetic citizen who produces wealth … governments, contrary to a well-known political superstition, have no money of their own.”

A generation ago this truth was so obvious it barely needed articulating. Thriving businesses drive economic growth which, in turn, drives jobs, wages and prosperity. In a growing economy, people enjoy choice and opportunity; in a shrinking economy, there is none.

Yet a quarter of a century of continuous growth seems to have dulled the appreciation of where wealth comes from. It is sobering to recognise there are fresh-faced journalists at the ABC who weren’t alive during the last recession and the overwhelming majority of the corporation’s staff have no adult experience of a shrinking economy.

Neither, seemingly, do the Labor Party’s policy advisers; or, if they did, they weren’t paying ­attention. How else could they have become entranced by the mumbo jumbo of “inclusive growth”, the notion that the act of redistribution of wealth actually increases it? Today that policy line is being seriously explored by the Chifley Research Centre, a think tank closely aligned with Labor, at the instigation of former treasurer Wayne Swan.

You’d have to go back to Matthew’s Gospel for a documented account of that principle in action when the good Lord fed 5000 men, their womenfolk and children with five loaves and fishes: “They all ate and were satisfied, and the disciples picked up twelve basketfuls of broken pieces that were left over.”

It’s a sobering reminder of where a nation lands when it turns its back on the enterprise culture: standing on a hillside, confronting shortages with little choice left but to pray for a miracle.

Nick Cater is executive director of Menzies Research Centre.