On my first visit to the United States as Australia’s Prime Minister, I have a clear and simple message:
America matters to the world; Australia matters to America; and Australia wants to matter more to America and to the world in the years and decades ahead.
Some people say that America is a spent force. They’re wrong.
By a large margin, America is still the world’s largest economy, the world’s greatest power and the world’s greatest source of new ideas.
Yes, America’s relative dominance is less than it was, as other countries have adopted modern technology and market freedom.
It’s good that other countries, especially in Asia, now have much bigger economies because their own people are better off and because they’re better customers for everyone else.
As imitation is the sincerest form of flattery, growing your economy by embracing freer markets is more a tribute to America than a threat to it.
Thanks to its inherent creativity – and the serendipity of shale gas – America’s energy vulnerability is lessening and its economic growth is at last becoming more robust.
A measure of this change is that manufacturing is now returning to America.
But whatever the latest economic statistics, and whatever the latest developments in Syria, Ukraine or the South China Sea, the world knows that America is trying to help and that America’s friendship counts.
So there are, you’ll be pleased to know, countries whose goodwill to America is no less than America’s goodwill to them and whose capacity to reciprocate is more than you think.
My country, Australia, has the world’s 12th largest economy, the world’s fifth highest standard of living and the world’s 5th most traded currency.
And, of course, America has no better friend.
We are the number one global exporter of coal, iron ore and beef.
We are currently the world’s fourth largest exporter of gas and likely to become the world’s largest within five years.
Australia ranks fifth in the number of universities in the world’s top 100 and hosts the fourth highest number of international students.
And we have first class military forces, in part because of the American alliance that allows our personnel to operate regularly with the world’s best and gives us ready access to the world’s leading military technology.
Australian and American forces have served together in World Wars One and Two, Korea, Vietnam, Iraq and Afghanistan.
In fact, when the doughboys first went into action in France in 1918, they did so under an Australian general at the battle of Le Hamel.
After 9/11, Australia invoked the ANZUS treaty because that wasn’t just an attack on America. It was an attack on civilisation.
America is Australia’s third largest source of imports and fourth largest export destination and that could increase thank to the US-Australia Free Trade Agreement negotiated by Prime Minister John Howard and President George W Bush.
Our country has invested nearly half a trillion dollars in America – and America has invested rather more than half a trillion dollars in Australia because we trust each other to treat each other’s hard earned cash with respect.
Since last year’s election, Australia has been under new management and once more open for business.
We are open for business because this government understands that you can’t have strong communities without strong economies to sustain them; and you can’t have a strong economy without profitable private businesses.
Wherever I have been in the world, this has been my consistent message.
“You can’t spend what you haven’t got.
No country has ever taxed or subsidised its way to prosperity.
You don’t address debt and deficit with yet more debt and deficit
…(And) profit is not a dirty word because success in business is something to be proud of…”
These are the economic fundamentals that peoples and governments lose sight of to their peril.
“Every dollar that government spends comes from the people, either through taxes and borrowings,
or…through the process known as quantitative easing which is not indefinitely sustainable”.
In the words attributed to Lincoln, government should do for people what they cannot do for themselves – and no more.
Since September last year, the new Australian government has practised what we’ve preached.
Environmental approval has been given to big projects worth some half a trillion dollars.
We’re well on the way to a one-stop-shop for environmental approvals.
And we’ve negotiated free trade agreements with Japan and Korea and hope to finalise one soon with China.
More than 100 major foreign investment proposals have been approved.
There’s been one business rejection – just one – because you don’t normally replace a locally-owned monopoly with an overseas-owned one.
We’ve repeatedly said “no” to businesses requesting government handouts – because if the “age of entitlement” is truly over, that surely starts with stopping business welfare.
The recent Australian budget deregulates higher education, because if there’s one sector that should be able to manage itself it’s universities.
We’ve reformed welfare, because young people should leave school to earn or learn rather than start their adult life on social security.
We’ve put a price signal on visits to the doctor, because medical treatment is certainly not free to taxpayers and people should normally make a modest contribution to the benefits they receive.
We haven’t actually reduced spending on hospitals, schools and social security – but we have reduced its growth because a system with relatively fewer contributors and relatively more beneficiaries is not sustainable for the long term.
Still, this is a budget for building as well as for saving: it funds the biggest national road-building programme in our history.
And I have a business delegation with me because we hope that American investors will help us to deliver it.
It’s a budget that plays to our strengths as well as lives within our means: it creates one of the world’s biggest endowment funds for medical research.
Instead of a two per cent of GDP deficit four years hence, the final budget result is close to balance; and gross debt, a decade hence, is reduced by almost $300 billion, or over 15 per cent of GDP.
We’ve done this because it’s better to be tough in your first budget than in your last.
There’s been a political cost, of course; but we have refused to put short term popularity ahead of long term respect.
As chair of the G20 this year, Australia is determined to lead by example.
The best way to boost private sector-led growth is to get taxes down, regulation down and productivity and participation up.
That’s why we’re abolishing the carbon tax, abolishing the mining tax and cutting company tax.
That’s why we’re cracking down on union standover tactics in the construction industry and improving our paid parental leave scheme so that younger women can realise their economic as well as their social potential.
The G20 should focus on boosting global growth; and, as it happens, the climate change policies that Australia will pursue are those which can directly reduce emissions without damaging people’s standard of living through economy-wide taxes and charges.
In the aftermath of the Crisis, Australia had four of the world’s top ten double-A rated banks.
Strong global financial governance is needed to guarantee confidence without inhibiting banks’ freedom to lend.
We need global tax rules to ensure that businesses pay tax in the countries where they earn revenue.
And we need financial system and energy system governance that better reflects the changing balance of economic power.
Australia supports freer trade and investment because more trade means more prosperity and that means more jobs.
Countries should focus on the things they’re best at, confident that lower costs and more freedom will produce more opportunities for jobs in successful businesses.
Who would have thought, for instance, that the largest manufacturing business in Australia would be making parts for aircraft that are built in other countries.
So we support bilateral, plurilateral and multilateral trade deals that make it easier for countries to trade with each other.
We support the Trans-Pacific Partnership negotiations; we hope that the best deal that has been offered to anyone will be offered to everyone; and we applaud President Obama’s free trade leadership.
If people are to lead better lives, they need clean water, healthy buildings and good transportation systems.
There’s an estimated $30 trillion gap in infrastructure that the world needs to fill by 2030.
Private capital is available to help build what we need but only if investors can be sure that their money is safe.
Creating a better framework for this infrastructure investment is one of the objectives of Australia’s G20 presidency.
In the space of a generation, the global middle class has grown by at least a billion people, nearly all of them in Asia.
The rise of China has been good for the wider world because there are now so many more people to afford to buy what the rest of the world produces.
A rich China means doesn’t mean a billion competitors so much as a billion customers.
We should be fundamentally optimistic about the future because these are all people with much to lose if things go wrong.
I’m looking forward to the coming Asian century.
The Asian century will be an Indian century, a Japanese century, a Korean century and an Indonesian century – as well as a Chinese one.
The Asian century will be an American century too because America is a Pacific power as well as an Atlantic one.
Asia needs America involved.
The world wants America to succeed.
The world needs America to succeed.
My hope is that you Americans will have as much faith in yourselves as the rest of the world has in you.
When the space shuttle was lost, President Reagan declared that the future did not belong to the feint-hearted; the future belonged to the brave.
It’s good to be here.
It’s good to be in what I too consider a land of the free and a home of the brave.
[ends]