Future Made in Australia Act will cook the economy

There was not one single solitary dollar sign in Anthony Albanese's "A Future Made in Australia" speech delivered in Brisbane. There should have been. This was a speech about re-industrialising Australia, but there were no specifics.

It was 3,302 words of waffle-a melange of soundbites and non-sequiturs-aimed as much at the next Queensland state election as it was the Future Made in Australia Act which was supposed to be the real subject.

When Mr. Albanese was asked if there was any modelling underlying the speech and how many jobs it would create, the prime minister could only waffle saying there was an opportunity to "grow enormous" jobs.

So no modelling then. What was he promising? Well we got the general idea when he said:

The so-called 'Washington consensus' has fractured-and Washington itself is pursuing a new direction.

The United States has implemented the Inflation Reduction Act and CHIPS Acts and pursued what they call a 'small yard, high fence' approach to critical industries.

The European Union has introduced its European Economic Security Strategy.

Japan has the Economic Security Promotion Act.

The Republic of Korea is re-framing its economic policy around a National Security Strategy.

And Canada has brought in new rules to tighten foreign direct investment in their significant critical mineral reserves.

So rather than the future being made here, it's being made over there and we are just going to tag along.

But it's not the future it's protection under another guise, even though he also said:

This is not old-fashioned protectionism or isolationism-it is the new competition.

So a guilty conscience-it's not what it looks like … protectionism? No, not here ... See what I mean by non-sequiturs?

So, absent any substance in the speech, let's rehearse the reasons why protectionism is not a good idea anywhere, let alone in Australia.

The first reason is that it doesn't work. Adam Smith demonstrated 250 years ago that we all do best by concentrating on what we do best. It's called comparative advantage, and it works.

Here's why

You might be good at making cars, and also good, but not as world-class, at growing corn. Another country may be good at both, but in the reverse order. You'll both do best if the one who is best at cars does all the cars, and the one at corn, does all the corn.