The Illogical Economist.

An Access Economics Report that states "Politicians worried about rural electorates have fallen over each other in the race to pacify angry farmers". The report further claims that farmers are enjoying their best returns in years despite claims that they do not receive enough government support. The report goes on to state that bumper crops, Europe’s foot and mouth crisis and a weak Australian dollar had all combined to boost farm incomes to near record levels.

These assertions reflect the incredible bias of many of the people who are paid huge amounts of money to advise the government. The news item does not indicate whether this is a report paid for by the government or not, but the authors were probably very well paid for the time they spent on it.

The inference in the report is that farmers are getting unjustified or unfair support from the government. All economic indicators are quite to the contrary. Statistics show that in Victoria, rural municipalities have an average household income $10,000 per year less than that of metropolitan areas. They pay up to 80 times the amount of some city people to maintain their roads.

Despite this disparity, governments build freeways for city people without any contribution. The percentage of country based traffic on city roads would scarcely be measureable. On a per capita basis, country people who may never use a freeway pay more than those who use them every day.

All this is on top of a public transport system that costs taxpayers $1.4 billion dollars per year.

Those are only two examples of featherbedding of city people who cannot see that they are pouring unearned wealth into the pockets of landowners in the central business district.

What the authors overlook is that farmers, on their own, cannot elect one Member of Parliament. Any person aspiring to represent a rural electorate knows that he or she has to win in the towns. Unlike city people, most people living in country towns understand the interdependence of town and country and they vote for politicians who show the same understanding.

Farmers, in turn, recognise the need for a strong prosperous town within reasonable distance. Apart from things like schools, doctors, hospitals and all the other facilities that the economists have just around the corner in suburbia, country towns provide the main focus of the social life of the farming community. They hope that family members may be able to find work there. They even hope they may find some themselves when drought, flood or bushfires affect them. They have even been known to seek it when governments follow the advice of economists and interfere in the price of the Australian dollar.

For decades, the Australian dollar was kept artificially high to the great disadvantage of country communities. The result of this has been the enormous growth of the capital cities at the expense of country towns; a process that apparently makes sense to economists.

Farmers are angry that the economists – and solicitors, accountants and everyone else who lives in cities, get massive handouts from governments whether they need it or not. If they are multimillionaires, they get a far bigger slice than if they are pensioners. They get it because governments spend billions of dollars annually providing roads and public transport that adds huge amounts to the value of their property and reduces the real costs involved in running their businesses without requiring a contribution.

While property values rise dramatically, the increased potential from rates goes to the local municipality, not the government that pays the bills. The means that metropolitan municipalities have far more money for facilities and amenities that country towns cannot provide.

Country people know that floods, fires and droughts are inevitable. They are usually restricted in the areas they affect and we can deal with them. On the other hand, the consequences of advice given to the government by economists are wrecking the economy of Australia’s country towns.