Notes
AUSTRALIAN ABANDON THE damage which the fresh restrictions on imports into Australia will do to the British export trade is not the most serious aspect of the Australian Government's regrettable de- cision. It is true that export managers in the motor car, textile and household goods industries will now have to wade through the new regulations, and then work out ways of selling some of their goods to other markets wherever this is possible. This will be troublesome, but Australia has been too 'easy' a market for many months,, and wise business men have seen the new re- strictions coming. What is really disturbing is that the Australians are apparently quite unable to • control their economy. Over the past five years, it has lurched from one un- healthy boom to the next, and unless there is a radical change in economic policy (even the will to try seems lacking), further orgies of spending will be followed by the familiar round of import cuts. Wherdas other countries have had a large measure of success in fighting inflation, Australia seems to have taken special care that inflation shall be a permanent feature of her economic life. The trade unions are strong enough to ensure that wages chase, or even lead prices, so that prices in Australia are out of line with those in other countries. This is made easier because the states and the central government have far more development projects on hand than can be undertaken by the existing labour force. Add to all this a strong protectionist lobby of business men who welcome import restriction because it is the one way in which they can continue to sell in their own market, and a central Bank which refuses to initiate a tighter monetary regime, and the whole picture adds up to inflation for ever. How long the present exchange rate can be held in these circumstances is doubtful. It may be, of course, that the Australians will be temporarily saved by another good season for their wool. But when that is over, there will be nothing to stop the proceeds being frittered away again as they have been in the past. This country has a further reason to resent Australia's behaviour, because it throws a burden on the sterling area system, and drains away gold or dollars from the central pool in London. Only when this becomes insupportable is there pressure behind the scenes on the Australian Govern- ment to put their affairs in order. So far, their immediate re- sponse has always been to cut imports, thus creating difficulties for British and other exporters. But more self-control in their own economic affairs is what is really needed.
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