The Lucky Country

With the Global Financial Crisis celebrating its first birthday, Peter Hartcher at the Sydney Morning Herald has an interesting article summarising Australia's experience and speculating as to how Australia has managed to avoid recession, maintain a vigorous housing market and keep a lid on unemployment while the rest of the world crumbled around it.

"From being one of the world's chronic underperformers, Australia has become a model. The country that the Economist magazine in 2007 labelled 'Downwonder' has emerged as a model in two senses. It's an example of an economic success, but it's also a model in that it has developed a distinctive political economy. There is now an 'Australian model'.

"Australia is a country that seems to have achieved a sweet spot, combining the vigour of American capitalism with the humanity of European welfare, yet suffering the drawbacks of neither."