How much of this race to the bottom to expand Tasmania’s exports is related to US dollar hegemony and resultant distortions in world trade and global economies?

“Ever since 1971, when US president Richard Nixon took the dollar off the gold standard (at $35 per ounce) that had been agreed to at the Bretton Woods Conference at the end of World War II, the dollar has been a global monetary instrument that the United States, and only the United States, can produce by fiat.”

‘Dollar hegemony’ means that the debts and the price of critical commodities such as the oil are denominated in US dollars.  Further, dollar reserves are required to sustain the exchange value of domestic currencies around the world. (To prevent speculative and manipulative attacks on their currencies, the world’s central banks must acquire and hold dollar reserves in corresponding amounts to their currencies in circulation. The higher the market pressure to devalue a particular currency, the more dollar reserves its central bank must hold.)

This means that the world’s interlinked economies no longer trade to capture a comparative advantage; they compete in exports to capture needed dollars…

Economist, Henry CK Liu, says that our exchange rates need to be based on global purchasing-power parity, as they once were. (Not a privileged mercantilist arrangement for the US alone).  Excessive dependence on exports merely to service dollar debt is self-destructive to any economy and world trade needs to be restructured toward true comparative advantage in the context of global full employment and global wage and ENVIRONMENTAL standards.

We can now see clearly that Tasmania’s focus on commodity exports (in particular) has resulted in the complete dismantling of effective (real) environmental protections.

For more info: Dollar Hegemony, by Henry CK Liu, 11th April 2002. http://henryckliu.com/page2.html

‘Globalisation’ has taken most of our manufacturing jobs offshore to mainland China, leaving a workforce with few options other than mining and forestry.
Interesting that both major parties here have concurred that economic prosperity is merely a matter of cuttting down more trees. Both major parties have beat the globalisation drum over the last 4 decades, to the point where we are only a bulk materials supplier to the Asian economic powerhouses. Desperate times when they admit they have no vision, no re-training schemes, no technological advantage and the only thing left to pawn is our ecosystem