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The world is going through a convulsion right now and how the economics of Greece and Baghdad
and the dishonest kinds of economics that have been going on in the industrial world,
how all this is going to play out, I don’t know. But it was very clear to me five years
ago that even before any of this came over the horizon that there’s two factors at
work that are going to cause everybody in the English speaking world to get poorer and
it’s unavoidable. And one of them is the fact that there’s a billion Chinese and
there’s a billion Indians now in the labour market, these are well educated hard working
people, they may be better educated and harder working than most people. And they’ve been
suppressed for a long time and kept out of economic activity, now they’re in the game.
And we in Australia are going to have to compete with a billion Chinese and a billion Indians
who work for one twentieth of the wages that we do. There’s only one thing that can possibly
happen as a result of this. Our wages and their wages are going to equalise and 20 years
from now the Indians and the Australians are probably going to be more or less equal in
balance. No war, no legislation, no tariff barrier, nothing the government can do is
going to stop this. The only thing that might stop it would be a collapse in global trade
which of course would even give us a bigger problem to deal with. So that’s the first
thing we’re all going to have to deal with. The second thing is actually over something
called peak oil, I’m sure you’ve heard of peak oil. There is going to be ever less
oil available to us from here on in. And that means that the price of oil is going to go
ever higher. And that’s in real dollars, it’s going to go higher and then higher
again. And since everything in our world is made out of oil, all food is basically oil,
I mean without oil we can’t grow the food, we can’t make the tractor to turn the ground
over, we can’t make the chemicals to make the fertilisers, the entire food system is
based on petroleum, and so everything that we buy is going to start costing more. So
on the one hand we’re going to get poorer, our wages in real dollars are going to go
down because we’re having to compete with the Chinese and the Indians and on the other
hand everything we buy is going to cost more because oil is going to go up. And one answer
to this bind that everybody is going to find themselves in is growing a vegetable garden.
Food gardening is very counter cyclical in economic terms. When things are prosperous
people don’t want to have a garden in the summer time, they want to get in their car
and go on a vacation. When times get hard they think about food gardening. And so being
in the gardening business is actually pretty good insurance against hard times. So times
are going to get tough. Times are tough. They’re going to get tougher and then are going to
get tougher again. And even if the government tells us we’re having good times, most people
are going to have a hard time.