For 20 years, Australia has deserved its reputation as a “lucky country”. Alone in the developed world, since 1991 it has been recession-free. It admirably weathered the global financial crisis thanks to a sound financial system and a made-in-China mining boom that has turbocharged the economy. As well as massive coal and iron ore deposits, it has huge reserves of natural gas ready to liquefy and ship to energy-starved Japan and South Korea. It continues to enjoy low public debt, low inflation and, for now, relatively low unemployment.
The term “lucky country”, however, has an addendum. Coined by the writer and social critic Donald Horne in 1964, the full phrase is less breezily optimistic. “Australia is a lucky country, run by second-rate people who share its luck.” Next month’s general election in which voters must choose which of two flawed politicians should steer them through the choppier economic waters ahead will test Horne’s aphorism to its limits.
Both Kevin Rudd, the now-you-see-him-now-you-don’t prime minister, and Tony Abbott, head of the Liberal party-led coalition, are flawed in their own way. Whichever of them wins will have a tricky job in managing the transition from what Mr Rudd calls “the end of the China resources boom”.