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Globalisation, the State and Regional Australia: a Case Study of the Shoalhaven Region

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University of Wollongong Research Online University of Wollongong Thesis Collection 1954-2016 University of Wollongong Thesis Collections 2015 Globalisation, the State and regional Australia: a case study of the Shoalhaven region Amanda J. Walsh University of Wollongong Follow this and additional works at: https://ro.uow.edu.au/theses University of Wollongong Copyright Warning You may print or download ONE copy of this document for the purpose of your own research or study. The University does not authorise you to copy, communicate or otherwise make available electronically to any other person any copyright material contained on this site. You are reminded of the following: This work is copyright. Apart from any use permitted under the Copyright Act 1968, no part of this work may be reproduced by any process, nor may any other exclusive right be exercised, without the permission of the author. Copyright owners are entitled to take legal action against persons who infringe their copyright. A reproduction of material that is protected by copyright may be a copyright infringement. A court may impose penalties and award damages in relation to offences and infringements relating to copyright material. Higher penalties may apply, and higher damages may be awarded, for offences and infringements involving the conversion of material into digital or electronic form. Unless otherwise indicated, the views expressed in this thesis are those of the author and do not necessarily represent the views of the University of Wollongong. Recommended Citation Walsh, Amanda J., Globalisation, the State and regional Australia: a case study of the Shoalhaven region, Doctor of Philosophy thesis, Faculty of Law, Humanities and the Arts, University of Wollongong, 2015. https://ro.uow.edu.au/theses/4638 Research Online is the open access institutional repository for the University of Wollongong. For further information contact the UOW Library: [email protected] GLOBALISATION, THE STATE AND REGIONAL AUSTRALIA: A CASE STUDY OF THE SHOALHAVEN REGION A thesis submitted in fulfilment of the requirements for the award of the degree DOCTOR OF PHILOSOPHY from UNIVERSITY OF WOLLONGONG by AMANDA J. WALSH, BA(Hons), Grad. Dip. School of Humanities and Social Inquiry 2015 CERTIFICATION I, Amanda J. Walsh, declare that this thesis, submitted in fulfilment of the requirements for the award of Doctor of Philosophy, in the School of Humanities and Social Inquiry, University of Wollongong, is wholly my own work unless otherwise referenced or acknowledged. The document has not been submitted for qualifications at any other academic institution. Amanda J. Walsh 30 March 2015 ii TABLE OF CONTENTS Abstract vi Acknowledgements viii List of tables, figures and boxes ix Abbreviations x Introduction 1 1 Globalisation—why it matters 8 Overview 8 Theories of globalisation 8 Weiss: Economic globalisation and state capacity 11 Scholte: the state as creator (and redeemer?) of globalisation 15 Globalisation and neoliberalism 18 A composite picture of globalisation 21 Globalisation and capital 23 Social and spatial impacts of globalisation 29 Conclusion 31 2 The Australian experience of globalisation 33 Overview 33 Globalisation, the state and neoliberalism 34 Globalisation in Australia 39 The political economy of globalisation: the Hawke/Keating era 43 Globalisation, China and the Australian economy 52 Legacies of the Hawke/Keating reforms 55 The Howard approach to globalisation 60 Conclusion 66 3 Globalisation and Australian industry: manufacturing 68 Overview 68 Manufacturing in Australia 69 The change in Australian manufacturing 72 The political economy of industry policy 76 The rise of industry assistance 78 Australian manufacturing in a globalising world: China v. the rest 85 Automotive manufacturing: a study in orderly decline 88 Conclusion 96 4 Australian agriculture and the dairy industry 97 Overview 97 The state and agriculture in Australia 98 Protectionism and its discontents 101 Productivist agriculture and the rise of agribusiness 110 Globalisation and the Australian dairy industry 112 (Im)balances of power in the dairy supply chain 115 Conclusion 123 iii 5 Globalisation in regional Australia 125 Overview 125 What makes a region? 126 Inequality and regional Australia 128 The drivers of regional policy in Australia 131 Globalisation and regions: in theory 133 Globalisation: impacts in regional Australia 134 Regional policy in the globalisation era 138 Conclusion 150 6 The Shoalhaven region of New South Wales 152 Overview 152 A framework for analysis 152 About the Shoalhaven 155 The Shoalhaven economy 160 Manufacturing in the Shoalhaven 168 Agriculture in the Shoalhaven 170 The case studies: an introduction 170 Conclusion 171 7 Case study: the Shoalhaven dairy industry 173 Overview 173 Dairy industry deregulation: how geography matters 174 The effects of deregulation on dairy farmers 176 Dairy farming in the Shoalhaven region 178 Deregulation and dairy farms in the Shoalhaven 181 How significant is globalisation for Shoalhaven dairy farmers? 186 Milk processing in the Shoalhaven 193 Local resistance: the Berry Rural Co-operative Society 196 Conclusion 200 8 Case study: paper manufacturing in the Shoalhaven 202 Overview 202 Establishment of the mill: capital and state 202 Globalisation and the Australian paper industry 205 Globalisation and the Shoalhaven Paper Mill 211 Rationalisation at the mill 214 Community-level impacts of rationalisation 218 The fine line between survival and decline 221 The end of the Shoalhaven Paper Mill 225 Conclusion 228 9 Case study: Shoalhaven Starches and ethanol manufacturing 230 Overview 230 The Manildra Group 231 The pros and cons of ethanol 234 iv The business of ethanol 237 The political economy of ethanol 241 Public policy for ethanol 245 When does an infant industry grow up? 261 Conclusion 265 Conclusion 267 References 270 v ABSTRACT Globalisation is often presented, or perceived, as an unstoppable economic force that confounds the efforts and capacities of governments to act against it. In fact, the expansion of transnational capital and the growth of capital accumulation have been actively facilitated by the state. Neoliberalism has played a central role, as the policy orthodoxy of globalisation: it has been essential in creating the economic structures that support and extend globalisation. Far from riding roughshod over national policies, neoliberalism has provided states with the means to reshape national policies in globalisation’s image. Neoliberalism and globalisation have strengthened and consolidated one another, via the decisions and actions of the state. Since the mid-1980s, successive Australian governments have stripped away barriers and regulations that had previously been judged necessary for the management of industries, social outcomes and the national economy as a whole. The promise of neoliberal globalisation was of greater efficiency, capital accumulation and wealth for the nation and its people. In the interests of the efficient allocation of economic resources, the state has sought to tread lightly on the market. The reality is that neoliberal economic policies have created highly variable outcomes for Australians. If we are to understand global capital, neoliberalism and the state in meaningful ways, we must understand them as they operate in, and on, particular places and people. This thesis examines the impact of globalisation in the Shoalhaven region of New South Wales, a coastal locality with a strong history in agriculture and light industry. The role of the state in strengthening or mediating the forces of globalisation in regional Australia is highlighted in case studies: dairy farming; and manufacturing, represented by the Shoalhaven Paper Mill and Shoalhaven Starches. These industries and enterprises have been highly important, economically and socially, to the Shoalhaven region over several decades. The case studies reveal the nuances, fallacies and contradictions of neoliberal policymaking. The Shoalhaven dairy industry and the Shoalhaven Paper Mill have struggled to navigate through a liberalised, market-driven business environment. In contrast, the Shoalhaven Starches factory has thrived on huge levels of state support for vi its ethanol manufacturing operation. Neoliberalism is well and truly ascendant in the Australian state, but policy anomalies—in which the state intervenes unapologetically in the market—remind us of two things: the continuing importance of political imperatives in government decision-making; and the continuing capacity of the state to shape national and local economies. vii ACKNOWLEDGEMENTS I am very grateful to everyone in the Shoalhaven, and further afield, who contributed their time and expertise to this project, and especially to my interview subjects in the local dairy and manufacturing industries. I am indebted to my two supervisors, Dr Glenn Mitchell and Dr Anthony Ashbolt, for their wisdom, support and patience. I also thank my family and friends for their endless encouragement, and for providing many distractions over the years, allowing me to keep this project in perspective. This thesis had its genesis in simple wondering—about the town in which I grew up and the changes to its physical and industrial landscapes, which were obvious, yet difficult to grasp. In particular, I wondered what my grandfathers—one a local dairy farmer, the other a paper mill worker and union official—would have made of the decline of the industries in which they had worked and thrived.
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