Contributed
Anthony Albanese is right to stand up against the imposition of a 25 percent tariff on Australian exports to the United States. This is not the act of a friend. It will hit the Australian economy, although luckily, Australia is not highly reliant on exports to that country. But it will still hurt the steel and aluminium exports, will the increase in the price of these metals will add to the domestic costs of what is left of Australian manufacturing, This, in turn, will flow through the whole economy.
The Prime Minister has urged Australians to “buy local” to deliver the message that they are not happy with this treatment. “Buy Bundy rather than some of the American products … You can make a difference,” he said. No argument against this.
Talking a stand against the imposition of unjustified tariffs against Australia is the right thing to do. For Albanese it could mean some closer connection with the Australian people, and this is an advantage during an election campaign. Contrast his, with Peter Dutton’s opposite approach of blaming the Australian government and implying that it is not the fault of Donald Trump and his administration. Albanese’s stand can be a winner for him.
A stronger stance, rather than the milder one he has chosen would have been better still. Other nations are retaliating against similar treatment with their own tariffs on American exports. Albanese has retreated from this. A tariff war is not what anyone should want. All the same, it is important for the world to show solidarity and deliver a collective message. Australia should be part of this. Anthony Albanese and his government should reconsider.
Simply saying buy Australian will not put real pressure on the Trump administration. Australia will continue to be ignored and treated with disrespect. Even more importantly, a strong stance would win the respect of the world.
The longer run answer is to become less reliant on economic ties to the United States. Trumps action proves the danger of being locked in too closely in an unequal partnership. They call the shots and Australia has little say. The best way around this is to shift more thoroughly to the East. China is already Australia’s biggest trading partner. There are rising opportunities through Southeast Asia, and India. This doesn’t exclude improving trade with other parts of the world. Australia does not need to be a dependency.
Many of these nations have also been hit with American imposed tariffs. By working together, we can overcome them. These tariffs will impact the global economy by making whatever we buy more expensive, and the flow through impact will be felt by all nations, Australia included. It makes sense that the best defence is for nations to act together. This is how they maximise the pressure on the Trump administration.
The real reason why this new tariff regime is being imposed is for raising American government revenue to pay for its geopolitical ambitions, and to turn over to the richest one percent, who are the real force behind this government. The tariffs are really a tax on imports into the United States to be paid for by ordinary Americans.
Price rises are already starting to accelerate. The capacity of Americans to buy is falling. An increasing volume of businesses will fail because of the increased cost put on their products. American exports will fall, because they are too expensive. The American dollar will continue to devalue because of a slowing willingness of the world to trade in it. This is no way to promote investment on rebuilding the American economy.
The prospect of a serious United States ongoing recession is real. Australia’s best interests are in decoupling from dependence and joining the rest of the world in the building of an alternative framework in which to operate.