He argued that the notion of ‘fairness’ was being applied perversely to maintain high levels of welfare.
He maintained that what was really unfair was the use of deficits to fund recurrent spending and the growing debt which would have to be repaid by the younger generations through increased taxes or spending cuts in the future.
Mr Richardson said that Australia had a number of opportunities for future growth but these would require structural change.
The first was through greater integration with Asia which could only really benefit Australia if economic reform has occurred first.
This would need to include competition and taxation reform.
He said that, if the policy was done right, the pay-off would be an $800 billion increase in national income.
The second is a shift to a cyber-economy which entailed the mainstream economy adopting cyber solutions as core business, something that it’s currently reluctant to do.
Thirdly he said that the level of innovation could increase and lead to new areas of economic development.
On the downside, Mr Richardson said that Australia was extremely vulnerable to a downturn in the Chinese economy.
He said a significant fall in Chinese growth rates in the near future would lead to a recession in Australia with 500,000 more people unemployed and a crash in share and house prices.
He said that there was a strong chance of this occurring in 2019 with the economy more vulnerable than it was in the global financial crisis.
However he was also at pains to emphasise that this was only one scenario and that it was also possible that China, and Asia generally, will sustain strong growth beyond 2020.
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