Jason Falinski (Mackellar, Liberal Party) Share this | Hansard source

Well, we have been warned, but I do thank the member for Solomon for his very worthy contribution to this debate.

In about 1800 a gentleman by the name of David Ricardo came up with the idea of comparative and absolute advantage when it came to trade. He realised that trade was not only beneficial to nations just because you were able to produce goods or services—mostly goods at that time—more efficiently than your trading partner and, therefore, trade with them; he realised that, even when you do it less efficiently than your trading partners, it is still beneficial to both countries to trade. The benefits of trade are enormous. We only talk about the economic benefits in this place, unfortunately. When they were talking about the Corn Laws in the United Kingdom between 1810 and 1850, Malthus was saying that we should drive up the price of food so that people on lower incomes—or, as he called them then, poor people—would not be able to afford as much food because, as he said, we were reproducing human beings at a much faster rate than our capacity to grow food. So he was very much in favour of the Corn Laws. However, Ricardo was able to show that this was short-term thinking. But the primary reason was not economic; the primary reason was actually peace. Ricardo, William Wilburforce and people like Pitt the Younger always felt that, if England could trade with France, the likelihood of them continuing to fight wars would decrease.

After the end of World War II, the architects of modern Europe and what became known as the EU were not primarily after economic benefits; they were after peace dividends. They realised that, if Germany and France's economies could be drawn closer together, the incentives for there being war would massively decrease. In our lifetime, it is inconceivable that Germany and France would go to war, though anything is possible. We may send the member for Solomon to sing in a Berlin bar at some point wearing a safari suit—and that could set off God knows what chain reactions. But, in the unlikelihood that that would ever happen, it is inconceivable that those two countries would ever go to war. That has primarily been because of trade.

When we talk about trade in the Western world or in the developed world, we think about how that has sometimes impacted the real wages of people who were in semi-skilled or low-skilled labour. Indeed, in the United States, real wages for people in the bottom 60 per cent of the income curve have not seen a material wage increase since the mid-eighties. That was primarily because, at the end of the eighties, we opened the world, through the World Trade Organization, to countries like China and a billion low-skilled workers became part of the international labour market.

We think about it in terms of the impact and the cost to people in places like the United States and Western Europe but what we don't think about is the poverty we ended in so many places around the world. In my lifetime, since 1990, we have lifted nearly 2½ billion people out of poverty—and not the sort of poverty where you can't afford the latest iPhone; the sort of poverty where mothers would have to choose between feeding themselves and feeding their children. Free trade has lifted more than two billion people globally out of backbreaking poverty. We have done more in shifting people out of poverty over the last 30 years than all the United Nations programs tried and failed to do from the 1950s onwards. It is a modern miracle and one we do not spend enough time talking about. When we come into this place and talk about our trade surpluses, our free trade agreements and how well the Australian economy is doing, it is right and proper we do so, but I don't want us to ignore the fact that free trade in so many other places in the world has been the difference between life and death and war and peace.

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