By Rama Gaind
PS News Books
Too Much Luck: The Mining Boom and Australia’s Future
By Paul Cleary (Black Inc, $24.95, softcover, 171 pages)
Is having too much luck a good thing? One wouldn’t think so, yet Paul Cleary reflects that Australia is often considered the lucky country, but what “we really have is dumb luck—too much luck, more than we know what to do with”.
He points out how the huge mining boom could turn from a blessing into a possible curse, unless there’s stronger and more effective government control.
According to Cleary, “As the resource boom accelerates, it will keep the dollar sky-high and force up the cost of doing business for everyone else. Industries such as tourism and education–industries that, unlike mining, involve many jobs–will fade away as our currency soars even higher.”
The journalist and researcher advises that in order to avoid pitfalls experienced by other resource-rich nations over past decades, Australia needs to make changes in three areas: saving, taxation and regulation.
As well, a substantial share of resource revenue should be put into a fund that can be drawn on when boom turns to bust–as it always does. By not capturing a larger share of the profits made by resource companies (through tax), Australia risks failing to maximise its long-term gain from the boom due to the unwillingness of either side of politics to establish a sovereign wealth fund.
Cleary also counts the human and environmental costs, shows what has worked overseas and suggests a better way forward–one which would turn this one-off windfall into a lasting legacy.
He provides a valuable public service if it prompts deeper thinking among policy-makers on how to handle the challenges we face.
Too Much Luck is a confrontational analysis of some of the opportunities and risks associated with the boom.
To find out more about Rama Gaind click here.