Did Free Trade destroy British and US Manufacturing?

[Luke Plaizier]

Well, what breaks the back of both a Union trying to improve the plight of the workers AND a government setting award wage standards, is that a company can just move to another country to bypass both of these. And we see that happening now too. Once again, this argument seems to focus on that 'people expect a high wage and a low cost of living'.

Given that low Tariffs allowed Japan - and other countries for that matter - to sell their post-war manufactured goods into Britain, did it pan out that Britain were then able to sell their goods back into those other countries? Making British manufacturing competitive didn't seem to make any difference without the key enabler of reciprocated tariff levels. Exposure to competition should also come with equal exposure to larger markets.


Lukeyson

[vanman_75]

That's it we may be living high but I wouldn't wish to live on their wages , besides this all can be fixed ..just by who is the problem , trying to keep politics out but seriously by who ? If we had protections like other countries then we may stand a chance .

[mik]

i don`t mean to be argumentative , but saying our products are not good enough / we don`t work hard in Australia is just ********, no doubt there are odd slackers here and there like any where, to label every one with the same brush is BS of the highest order.

look at the bloody crap that is coming in from over sea`s and spin me that line again will ya, the mere fact that we have twice as many car brands being dumped in this country as the US,................. has to have alarm bells going, it`s not only cars,
go for run down to our local container yards/wharfs and tell me what you see!
i can tell you what you`ll see because i made my living out of carting the crap off the wharfs and delivering it for many years,
every thing from barby`s to oranges , machinery,clothing, raw materials etc and anything else you can think of.

The fact that other countries can send freight thousands of miles and sell it in Australia at a good profit compared to most of our Australian products must signal there is something wrong, here`s another example look at the tons of cheap crappy tools coming in from over sea`s , that are selling in the stores these days............. is our stuff inferior to this? no it is`nt , however our stuff is more expensive and there lie`s the problem, you can blame unions and lazy ozzies for everything, but it just does`nt add up , the problem imo is the cost to build every thing here , and the cost of living, of course people are going to ask for pay rises when bills go up(looked at your power bill lately?), however i reckon our main woe is fair trade agreements (the fact it is`nt fair).

some of you blokes have been spinning the line that we do nothing right and every body over sea`s does every thing so much better, UTTER CRAP !.
Aussie and proud of it

[2011G6E]

Sorry, when I said "militant unions" I didn't mean simply unions wanting fair pay. If you look up the history of the unions and the car industry in England at the time, you will see it was just sheer bloody-mindedness keeping factories shut, not caring if the place went bust and the workers no longer had a job, and workers who just blindly were happy to stand outside factory gates for months at a time and went along with the unions "us and them" and communistic ideals that said there was something intrinsically wrong with a rich guy owning a car company and employing workers.
It was definitely nothing like we have ever seen in Australia (thank christ) and when the guys did decide to turn up for a days work, they had ingrained in them the idea that the typical English class system was working against them, so why not sabotage the rich bastard running the factory and make a crap product? And they did. And it shows if you drive a 1970's British car...

Sorry if I gave the impression that I am tarring unions here with the ****-covered brush that those English unions splattered all over the industry there and destroyed the industry...and jobs...for everyone. I'm not, I'm a firm union supporter and always have been, but I also don't see them as god-like and in other parts of the world have they sure got it wrong in the past...

[GQ_Smooth]

You can thank the former Soviet Union for the 1970's British Militant Unions, I would be different now, but unfortunately to late.

FTA are far to complex to discuss in a forum like this. People's self interests tend to outway the "greater good". Protectionism will eventually always fail in a capitalistic economy (like ours) people forget the majority of Asian coutries aren't capaitalistic democracies. Protectionism is one of the main reasons some European countries are going through extreme ecomomic hardship. Governments (i.e tax payers) kept propping up un-economical industries, because the public could not and would not allow them to die, this along with corruption by people/corporations dodging their tax responsibilities, have seen these nations go broke, and no one will take any responsibility for it.

If Australians are happy to purchase the cheapest goods on the market rather than a equivillant or better quality Australian made product, we have no-one to blame but ourselves. I don't believe it's the governments (our taxes) job to lower the price of Australian goods for Australians to purchase. The decision is with us.

However if the Australian product is substandard, then it doesn't deserve to be in the market.

[GhiaEB]

I work damn hard for my living! I buy Aussie made whenever I can. I was a union supporter. He'll I get up just after midnight to go to my job.

But times have changed. I quit the union. Unions these days only think of themselves! They will gladly see a company fold and 100s of workers lose their jobs and then tell the next lazy sod that they got them a 6% pay rise just before the company folded, except leave out the part that the company folded or moved offshore.

This isn't 40years ago. This is today. We are part of a world economy. FTAs our gov has signed never work out for Aus. As was said earlier we need to lower tariffs/taxes equally on both sides.

The other thing we have here is a handout society. There is becoming a culture of expecting everything to given to people. "Oh I got up this morning and went to work, I did nothing, but I went to work. Pay me", "Oh I lost my job because I did nothing, pay me", "Oh I didn't get a job because I didn't look, pay me". Most Aussies have become lazy and become obsessed with a "that'll do" attitude.

You reap what you sow.

[turbodewd]

Originally Posted by GhiaEB

Most Aussies have become lazy and become obsessed with a "that'll do" attitude.

You reap what you sow.

I disagree strongly with the word 'most'. The vast majority of ppl here arent lazy. But certainly there is a small grouping who are excuse makers and dole bludgers. They shift the blame away from themselves as to their predicament.

Our overly generous welfare system does more harm than good to certain types of people.

[Luke Plaizier]

Originally Posted by GQ_Smooth

If Australians are happy to purchase the cheapest goods on the market rather than a equivillant or better quality Australian made product, we have no-one to blame but ourselves. I don't believe it's the governments (our taxes) job to lower the price of Australian goods for Australians to purchase. The decision is with us.

However if the Australian product is substandard, then it doesn't deserve to be in the market.

What if, as we have seen written, foreign countries are subsidising exports so that they can be sold artificially low in Australia? Or if companies, such as those that produce solar panels for example, 'dump' their products in Australia at artificially low prices with the sole objective of wiping out local manufacture?

What if those foreign countries, with huge populations and thus large economies of scale, prevent Australian companies from accessing those markets via high tariffs and taxes, and therefore prevent our companies from achieving the same economies of scale?

And what if those foreign countries 'gift' land to state owned businesses, thereby eliminating the cost of the land or rent on which they operate from their operating costs.

What job does our government play in protecting us from the predatory activities of neigbouring countries, who are now allowed to sell into our market with no interference, yet have all these benefits of economies of scale, free land and subsidies that most Australian business don't have? (Yes, I know, the Auto Manufacturers are getting subsidies.)

I think Australia needs to act now in equalising Tariffs with other countries, and yet I still strongly support the objective of reducing Tariffs.


Lukeyson

[2011G6E]

I'm sorry...but I refuse to pay more just to "buy Australian". The goods would have to be remarkably better than the imports to persuade me to do so.

Given that a great percentage of the "dinki di true blue Aussie" stuff has "Made In China/Taiwan/India" on the side of the box, why bother?

[GQ_Smooth]

I will gladly pay 20% more for a locally produced product that is equal to or better quality than an overseas item, I've even trained my wife to do so. And subsadies are not part of a FTA.

Predatory pricing is handled by the A.C.C.C (although good luck getting anything done withing 12 months there). It's something we have to live with, global companies regularly change transfer pricing of goods from country to county, so they make the least profits or even losses in the highest taxed countries and shift all their profits to those with the lowest tax base. EG: it's more expensive to purchase a Hyundai from the factory for Australia than the US, hence the business makes little if any profit in Australia, technically they run at a loss which the parent company is happy to cover because it keeps the factories making cars, cost of the vehicle in the US is cheap, due to a cheaper tax base, so the business while less efficient than Australia turns a half decent profit. I can go on about this for to long. You can do your head in picking holes in policies.

[aussie muscle]

Originally Posted by loftie

but we're happy to pay $2.00 for a T-shirt that's been made in a sweat shop o/seas.... and squeal like pigs when we're seeing T-shirts that are 'basically' the same for $35.00.

What i hate is they can't sell the australian made tee for $35, so they go to china and make them for .50c and then bring them back here to sell them for $35 anyway.

[Flat Top]

strategic dumping wrecks economies, wake up australia ??
price transferring optimises profits to where they attract little /no taxes. wake up australia.
why do we have 57 brands of Cars in Australia ?? wake up australia!
Free Trade Agreements - wake up Australia - stop the pollys wrecking manufacturing , once its gone its Gone - Look at NZ?? its an agricultural economy , wealth based on property values ? Please wake up Australia??

Did FTAs destroy UK and US manufacturing NO!
they each destroyed their own manufacturing base through lack of innovation, continued declining labour efficiencies (thru lack of capital investment) No export basis.
Look at Germany? whilst they are participating in Global manufacturing there is a fundamental difference in the way investment is strategically controlled and directed. (unlike usa uk and Aust??) through their boards , and management. Wake up Australia!

[Luke Plaizier]

The success of West Germany and Japan has a lot to do with the money, effort and open trading policies the UK and US put into rebuilding each of them after WWII.


Lukeyson

[JG34JA]

Originally Posted by Luke Plaizier

How do we deal with a situation where we have no equality of trade and no prospect of equality or true fair trade being established?

I'd say shut down businesses that can't compete and put people out of work, like we are doing now. Move all local manufacturing off shore so companies can finally make a profit by selling back into Australia, like we are doing now. Just ask Harvey Norman how his off-shore website is going. Sell everything we own for short term gain - even the ground underneath our feet, like we are doing now.

Create a situation where nothing is made in Australia, we run out of things to sell, and all we ever do is buy from overseas. The Australian dollar is then worth nothing, and we get to a point where we can't afford to even buy anything from overseas.

Maybe you could sell your house, live in a tent, and take a such a hefty pay cut to ensure you're on lower wages than those in China so we can make up for their Tariff inbalance?

China and US foreign policy focuses on outcomes that benefit China and US. Australian Policy seems to focus on outcomes that benefit everyone other than Australia. Nice one.


Lukeyson

I agree that trade policy has been disastrous for Australia. It is almost as if it were engineered for such a destruction of production. We are currently under the delusion that production doesn't matter and we can all work in services or RE construction/selling; look to the US to see how that pans out.

We've identified that we are in a deeply unfair trade disadvantage with our neighbours, when it comes to manufactured items. We can beat them on cost and quality, but are going to have to think outside the box to do this. If they don't let us in, then let's create products that dominate our markets and do it well, so theirs hardly get a look in no matter how much they dump them.

We have almost unlimited power here from the sun. We have almost unlimited natural resources. We do have water. Liquid fuels are the life blood of a modern economy. We have very restrictive environmental and IR regulation and heavy taxes.
1) Synthesize and produce liquid fuels. The South Africans make diesel from coal, the Brasilians use cane derived ethanol. Algae opens a whole new paradigm in marginal or desert landscapes.. If we don't have a great amount of light, sweet crude it won't matter. Develop the alternatives, including natural gas with which we are blessed.
2) Use the sun - the Europeans can do solar steel mills, why can't we? Begin to produce from resource to value-added product again, like our policy makers set things up from the end of WW2 to about 1975.
3) Make things to fine tolerance, aim for quality.
4) Automate. If done well and enough with cutting edge technology, our overall labour input can better the mercantilist nations. Think 3D printing, CNC etc etc
5) Change legislation: make "industry parks" where land is free/very cheap, where Enterprise need not be hunted by regulation/worksafe/EPA/rates/overbearing unions/shifting and changing government policy.
6) Make a dedicated bank (used to be the Commonwealth Bank) to fund such enterprise. Got an idea? Make it a reality.
7) Target products: target better products at what Australians buy. Must we import BBQ's for example?
8) Think big: what if we link QLD coal and WA iron ore? How would that be for economies of scale in steel production? (Of course, coal and smelting are very naughty things these days, better to ship offshore so the CO2 is not released in our back yard...)

Any individual can have a vision like this for manufacturing in this country, but if we are actively encouraged by policy to offshore then it will not become a reality. The policy has to change, and until then the response will be "how can we best deal in the present situation?"

[Cruzycuzz]

I see lots of union bashing on this thread..
I'll just say this..why is it when a worker asks for a pay rise it's called communism..
When a corporate CEO on a multi million dollar salary runs a business into the ground like what happened in GFC it's called good business practice?

[DanielXR8]

Originally Posted by Cruzycuzz

I see lots of union bashing on this thread..
I'll just say this..why is it when a worker asks for a pay rise it's called communism..
When a corporate CEO on a multi million dollar salary runs a business into the ground like what happened in GFC it's called good business practice?

A lot of people these days just get on the internet and monkey what they read on US based forums. Which is how you get garbage like "Government Motors" creeping into conversations about GM Holden. Same with the anti union crap.

Would be nice to think most Australians could think for themselves, but they don't.