Interview with Kieran Gilbert – AM Agenda – Monday, 10 April 2017


SUBJECTS: India Australia Free Trade Agreement, Speech to American Chamber of Commerce the Politics of Trade.

KIERAN GILBERT: With me now Labor’s Jason Clare, trade spokesperson for Labor. Mr Clare thanks for your time. The Prime Ministers in Delhi focused on trade. I think I’ve seen this movie before where Prime Ministers go to India talk up the prospects but nothing eventuates.

JASON CLARE, SHADOW MINISTER FOR TRADE AND INVESTMENT, SHADOW MINISTER FOR RESOURCES AND NORTHERN AUSTRALIA: I’m glad the Prime Minister’s there, he should be there. This is a country that provides a massive opportunity for Australia. It’ll be the biggest country in the world in population terms in just over a decade. Frankly the Prime Minister should have been there last year. He promised that he would have concluded a free trade agreement with India by the end of 2015, it’s now 2017. It seems like this agreement has now stalled again. This trip is an opportunity for Malcolm Turnbull to put the jumper leads on this agreement and get it moving.

GILBERT: But as I say it’s not the first time a Prime Minister has talked up the prospects here. It is comparable – really the only nation anywhere near China in terms of its size. Our trade with China is booming, it’s undercooked with India. Is there any particular reason for that?

CLARE: It’s massively undercooked. Malcolm Turnbull’s the first Prime Minister to make a commitment to sign a free trade with India (he said he’d do it) by the end of 2015. Like a lot of things on trade the Government’s overpromised and under delivered. But if we can sign a top quality free trade agreement with India then it holds out the prospects of lots of jobs for Australians. I’m glad to see that we’ve got representatives from universities on that trip as well, we don’t just want to see more Indian students studying in Australia there’s also the opportunity potentially for some of our universities to set up campus in India as well. So if that can come out of this trip if we can get this free trade agreement back on track then that’s a good thing.

GILBERT: I want to ask you about this speech you’re going to give today at the US Chamber of Commerce, you talk about the politics of trade and there’s been a great deal of that over the last 12- 18 months with the Trump victory in the United States and anti-globalisation sentiment around the world. One of the figures you point to is while in Manhattan for example – in the United States -there’s been an increase in income growth in recent decades, in places like Detroit and Michigan wages are 10% lower, this has a tangible effect on people’s view of free trade.

CLARE: Big time. Trade in America is about as popular as a snake in a sleeping bag at the moment. It’s one of the reasons that Trump was elected. There are a lot of people that are angry and frustrated – their incomes are going backwards. You made the point that incomes have gone up in places like Manhattan but they’ve gone backwards in that rust belt part of the United States. The places that voted for Donald Trump. They’re worried about immigration, they’re worried about overseas workers taking their jobs, they’re worried about their take home pay – the amount of money in their wallets or their purses – and they blame trade. The point I’m making today is quite worrying in you can see the seeds of the same thing happening in Australia, and that’s scary given how important trade is to Australia. You see the gap between the rich and the poor in Australia expanding. It’s not on the scale that it is in the United States but its growing. Whilst in places like in Sydney and in Melbourne you’re getting lots of new jobs created if you got up to the north coast of Queensland (places where Cyclone Debbie hit) you’ll find that unemployment is going up and just like the rust belt in the United States wages are going down – and they’re the places where Pauline Hanson is getting as much as 30% of the vote.

GILBERT: If you talk to economists, as you know as the trade spokesman for Labor, they’ll argue that it’s not trade itself that’s pricing out jobs in these particular areas it’s structural changes in the economy more broadly, in terms of technological change and that sort of thing, as you touch on in this speech today.

CLARE: More often than not it’s automation, its technological changes. America has lost a lot of manufacturing jobs over the last few decades some of it’s because of trade but most of it’s because of automation. But if you’re someone who’s just lost your job, you don’t really care whether it’s trade or whether it’s a robot that’s taken your job, you just want your job back and you’re angry and you’re frustrated about it.

The point I’m making today is if we’re going to fix this trend to protectionism we’ve got to reduce the gap between rich and poor, we’ve got to provide more opportunities for working class Australians. At the moment the Government’s doing the opposite. They’re cutting funding for schools, they’re cutting funding for TAFE, cutting money to low income families, not doing anything about penalty rates either and in the budget they’re going to give a $1,6000 tax cut to millionaires. Now that just makes the situation worse. It creates a more divided country and that creates the prospect of what we saw in the United States last year traveling across the Pacific and happening here.

GILBERT: Is it more than just the policies of equity as you argue today but also the ability to – as you pointed out earlier – explain how pivotal foreign investment and trade has been to this country forever?

CLARE: That’s right. The tariff walls that were ripped down by Bob Hawke and Paul Keating have created the open, competitive economy we have today. It’s built on the wreckage of those tariff walls that were ripped down by Labor in the 80s and the 90s. But if you survey Australians, most Australians still think unbelievably that trade doesn’t create jobs, it’s the same thing in the United States. This is what I’m talking about in this speech today, it’s what I’m worried about. Even though it’s obvious that trade creates millions and millions of jobs, most people don’t believe it.

One of the reasons is that in economies like Australia’s and like the United States trade tends to create more white collar jobs, high skilled services jobs rather than blue collar jobs. So there’s a lot of people who work in the trades who are feeling the burn and not the benefits. If we’re going to fix this and boost support for trade then we’ve got to do more in education and we’ve got to do more to encourage Australian business to get out there and export. One of the other things I say today is that even though we’ve got 2 million odd businesses in Australia, only about 50,000 of them are exporters. Export companies create more jobs and create higher paying jobs. We need to encourage more Australians to get out there and take up those opportunities, whether it’s in India, China or anyone else in the world.

GILBERT: Shadow Trade Minister, Jason Clare I appreciate your time on AM Agenda this morning ahead of that speech to the US Chamber of Commerce today.