The four decades from 1851 to 1890 saw fast economic development. The
population multiplied by almost ten. Just imagine today’s Australia displaying
a similar pace of growth in the next forty years. It would mean that the present
population of 23 million would exceed 200 million before the year 2055. In
the initial gold era, Victoria was the leader and Melbourne, its capital, passed
Sydney in population; but every colony enjoyed one or more phases of fast
economic growth: Western Australia was the exception, lagging until the
1890s. The most backward of the seven Australasian colonies, it came alive
through gold in the 1890s, trebling its recorded population in the space of ten
years. As a trigger of growth, gold was dynamic over a far larger geographical
area in Australia than in the comparable gold countries of North America and
South Africa. Furthermore, Australia’s rushes—and New Zealand’s too—began
when the local economy was tiny and therefore was more easily transformed
by a dynamic new activity.
In thefirst forty years after the initial discoveries, gold’s impact on Australia
was formidable. Most historians—persuaded by the calculations of Noel
G. Butlin—now believe that, for about four decades, the Australian people
enjoyed the highest—or close to the highest—standard of living in the world
(White 1992, p. 155). Even at thefirst peak of the gold output, in the mid-
1850s, Australia’s standard of living probably was amongst the highest. The
Australian ports and gold-diggings were heavy consumers of luxuries, includ-
ing natural ice imported in sailing ships from Boston at high prices (Blainey
1966, pp. 275–6). This was simply one of many mirrors of a high standard of
living. By 1889, urbanization and the kind of consumer life lived in the cities
were others (Frost 2015, p. 250). Of the declining population of Aborigines,
most did not share noticeably, and many did not share at all, in these gains.
Large numbers, of course, lived totally outside the European–style economy
and had barely heard of it.
In explaining Australia’s high per capita standard of living, especially in the
period 1850–90, the exploitation of grasslands and mineral deposits and
other new natural resources was vital. Also important were the highflow of
British capital at low rates of interest, the adoption of new British technology
in manyfields, the introduction of suitable livestock and crops from the
northern hemisphere, and the presence for four decades of relatively
favourable weather in the south-eastern quarter of the continent. Ample
rain was a boon in an era when rural production was vital to the standard
of living. A little-recognized asset was that in the nineteenth century most
immigrants came from the British Isles, which, at that time, were, compared
to most other peoples, sympathetic to new technology. After 1890, as we
shall see in section 2.8, Australia’s relatively high income began to fall on the
international ladder.
Australian Exceptionalism: A Personal View