A careful thoughtful view delivered at the LSE in October 2014 of the “big” issues from one of Australia’s most eminent economists. The title borrows from one of the great political economy tomes of the 20th century, written by Joseph Schumpeter (1883-1950). Garnaut refers to many of the the most important political philosophers and social thinkers of the 20th century as he examines the big picture issues through the lens of the nations he knows best – Australia, China (where he was at one time Australian ambassador), Indonesia and Papua New Guinea. Focusing on the ageing of the population, climate change and the distribution of income, he assesses the challenges, the different histories, the lessons learnt and the lessons not learnt.
It leads him to suspect that the world might now be entering both a permanent low rate of economic growth phase and a permanent decrease in the rate of return on capital. Interestingly, the lower growth suggests greater political instability while a lower rate of return on capital suggests that the distribution might not continue to worsen along the trajectory suggested by Piketty.
Garnaut has held senior roles in many universities, consults to business, government and other Australian and international institutions and he was economic advisor to both the Hawke and Keating governments.