Future Made in Australia Act will cook the economy

It's much the same principle at work as when the medical specialist pays someone else to cut his lawn, but the pensioner cuts it themselves. Just because you can do it doesn't mean you should.

Australia has done well when it's observed this rule as an open economy.

What about when another country subsidises its producers, and exports their products to us at a cheaper price, aren't we justified in raising tariff barriers?

No, not generally.

The government of the other country is subsidising your lifestyle-make the most of it, they won't be able to afford to do it forever-and reinvest the surplus in something that will make your lifestyle even better.

There are exceptions to these rules. One is that as countries get larger the harms of protectionism can largely dissipate.

Competitive advantage works best when the whole world is trading with each other fairly, but the greatest advantage is to small countries because they get access to scale that is simply not going to be available to them domestically.

The larger countries are, the less scale counts, and the smaller the savings.

Australia, as a well-developed small country, will gain more from open trade than the United States as a well-developed large country, meaning that policies that might not be too damaging in the United States can be disastrous here.

Large countries can also afford trade wars better than small ones, and they can have more effect on the unfair trade practices of others because of the scale they offer to producers who export to them.

If a country can't access the Australian market, big deal, but if it can't sell to the United States, that is more of a problem.

U.S. Presidents Donald Trump or Joe Biden might (and I stress, might) be able to win a trade war, but they have the world's largest economy, representing 13.3 percent of global GDP and a population of 333 million, while we have the 12th largest, 0.8 percent of global GDP and a population of only 26 million.