When Austraia has no non renewable resources (ie Coal, Iron etc) to trade with China we will have to accept the same standard of living as the Chinese.

Peter Hume, i wish (and hope) you are right, but i have my doubts that unilateral action is enough to achieve goals.

Perikles, i do agree with your sentiment of the need to adapt to changes in the world. After all, i am a realist.

As the EU does, it is increasing protectionist measures against some 60 Chinese products, but i assume the entity is still committed to freer trade in general terms. That is the approach I would like to see all Western nations adopt, including Australia.

I think this trend will be inevitable as Western nations increasingly realise that severe economic restructuring is inevitable, regardless of wishful thinking on Aust's part.

Perikles,

I also agree that China has important considerations and needs.

However, i do not believe that we should merely accept our demise, or we should merely support policies which are now essentially a China benefit (especially for the Communist party, its elite and wealthy class that have the best of all worlds - cheap labour and a govt which can do just about anything it likes in terms of the direction of vital resources).

The West can retain its commitment to freer trade, but be increasingly insistent that China adheres to the same rules that Western economies allow. If China wants to place immense barriers on Western companies, then their companies should also face similar barriers.

In other words, the West's past toleration of China's practices, which did deliver it immense economic gain, should now be at a point of greater limitation and less generosity.

Worst case scenario, assuming that all parties remain peaceful, is that China will have to look to alternate strategies to boost its domestic economy rather than attracting more and more production away from other nations.

You still seem to view this in apocalyptic terms, Mr Lewis.

>>However, i do not believe that we should merely accept our demise<<

International trade is not, and never has been, a zero-sum game. China's future prosperity does not mean that we will be concomitantly poorer - except, of course, in relative terms. China becoming richer is inevitable, but certainly not an indication of any "demise" on our part. That's Tea Party talk.

>>i do not believe that we should... merely support policies which are now essentially a China benefit (especially for the Communist party, its elite and wealthy class...<<

Hmmm. Are you equally vocal when discussing Wall Street bonuses, or the salaries-and-perks of our own home-grown "elite and wealthy class", I wonder? Your observations on Ralph Norris' $16.5m (he earns Australia's average annual wage every day of the year) Ian McLeod's $15.6m, or Marius Kloppers' $11.6m might be of interest in this context. What is the major difference between the "elite and wealthy class" in China, and our own pigs-in-the-trough?

http://m.news.com.au/TopStories/pg/0/fi823709.htm

"...the average chief executive's total pay in Australia's top listed companies increased 131 per cent over the decade and the median bonus rose 190 per cent. Average workers' pay increased 52.3 per cent over the same period and returns to shareholders only rose 31 per cent."

>>If China wants to place immense barriers on Western companies, then their companies should also face similar barriers.<<

And these "immense barriers" are...?

Perhaps you could be a little more specific about the action you see us taking. That would help cut through the somewhat emotional rhetoric, and assess your arguments against the realities.

Chris Lewis.
I'm blowed if I can how you can see "free trade" as anything more than a misnomer, in historical-practice or even ideally.
The "principles" of free trade you seem to want to sanctify have only ever been hypothetical, and indeed are evocative of government regulation to keep them free, which instantly invalidates them. In the real world these principles have been deferred, circumvented, creatively interpreted and ignored since forever. Indeed it's fair to say that free trade does not, has never, and cannot exist. Free trade is on par with talk of utopia.
Which begs the question as to your hostility towards China. It has its self-interests and an ideology to push, and it does so by whatever underhand means are at hand (the true principle of capitalism) in this realist dispensation. Are you saying that the West is inhibited by scruples(rofl)?
Free trade is as close as you can get to natural evolution, and just as principled!
China's authoritarianism can on the other hand be seen as principled; it doesn't patronise its population with a false sense of security, nor encourage egotism the way the West does. It's been forced by the dominant paradigm to get down and dirty, but maybe it's taken the old parable to heart about lying down with dogs? Maybe it's determined to suffer the humiliation to a point but no further..
China's an unknown entity and we can only speculate as to its intentions. But to foster the ludicrous premise that the West is somehow above resort to whatever underhand means present themselves, that it doesn't have a hatefully-violent and authoritarian history itself that "goes way back", or to imagine that it wouldn't in an instant resort to violence and authoritarianism again, should it prove more "economic", or that its methods are not or have not always been entirely opportunistic and beneath contempt, is frankly naive.
China's rulers do authoritatively what the West does by deceit, manipulation and stealth.
None of which is to say I'm not nervous about China, but better the devil you don't know than the devil you know.

Pericles, these 'immense barriers' come in many forms.

I'll try to list some specific issues with references.

1) Foreign firms operating in China find themselves under much more scrutiny than Chinese firms. They can't adopt the same practices as local firms. This is advice from a law firm operating in China.
http://www.chinalawblog.com/2011/09/how_to_conduct_business_in_china_lay_low_make_friendsfollow_the_law.html
The point is, that while Chinese law is actually much clearer than most people think, enforcement is spotty. It used against foreign companies much more readily than local.

2) The lack of an independent judicial system means that those in power, namely the central government, are capable of subverting or ignoring the legal system. This is a disadvantage for many smaller businesses, true. But for large, state owned enterprises, it means they lack accountability. A definite advantage when they're competing against multinationals who generally need to at least abide by the laws of where they're based. For more, this case is rather enlightening:
http://www.theage.com.au/opinion/society-and-culture/making-a-public-spectacle-of-proceedings-could-ensure-justice-in-china-20110808-1ij38.html

3) Foreign companies wishing to operate in China tend to find themselves needing to use one of a variety of corporate structures. In the past, Variable Interest Entities (VIEs) have been popular. (More on those here: http://www.businessinsider.com/reuters-china-vie-company-structure-under-threat-2011-9)
These days, it's more common for investors to find Chinese partners. These deals often involve all kinds of clauses, such as technology or IP transfers. Essentially, this means that if you want access to the Chinese market, you have to do it with a Chinese business and often give them your hard earned branding or R&D.

4) The media as a cudgel. It's easy to see when it's used politically. Take this snitty piece on Gary Locke: http://www.globaltimes.cn/NEWS/tabid/99/ID/676399/Lockes-lifestyle-and-new-mission.aspx
It's harder when it's being used against corporates, but there's more on that here: http://www.chinahearsay.com/china-attempts-ugly-friend-gambit/

5) Ownership restrictions.
Name one foreign media network with a significant slice of any of the Chinese media. There aren't many, because that's restricted. I'll grant you, Baidu is foreign owned and controls most of the online search market. It however, has been coming under sustained attack from the Government owned CCTV network, which has also launched their own search engine. Funny that.
http://chinarealpolitik.com/2011/08/22/whats-really-behind-the-dispute-between-cctv-and-baidu/