'Australian disease' has entered its terminal phase

[CAMS290]

Paul Keating's infamous quote to John Laws nearly 28 years ago !

If this Government cannot get the adjustment, get manufacturing going again, and keep moderate wage outcomes and a sensible economic policy, then Australia is basically done for. We will end up being a third rate economy... a banana republic.

Speaking to John Laws on Radio 2GB, May 14, 1986.

[fte50]

Everyone has a choice, the old saying "don't cry foul of those better off" .

[CoupeKing]

http://www.youtube.com/watch?v=bx0IeQQ7WjI

[cheap]

Originally Posted by CAMS290

Paul Keating's infamous quote to John Laws nearly 28 years ago !

If this Government cannot get the adjustment, get manufacturing going again, and keep moderate wage outcomes and a sensible economic policy, then Australia is basically done for. We will end up being a third rate economy... a banana republic.

Speaking to John Laws on Radio 2GB, May 14, 1986.

Some people will say Keating policies were part of the problem...

[CAMS290]

Originally Posted by cheap

Some people will say Keating policies were part of the problem...

As far as the automotive industry is concerned I think Mr Button started the ball rolling in 1983 with the gradual reduction on import tariffs, FTA's with our Northern neighbors have open the flood gates for cheap imported cars but have done SFA for our exports.
The resources boom the high AUD and the ridiculous wage claims haven't helped the cause.

The consumers have never had it better, cars are more affordable than ever, electrical goods like TV's, washing machines etc...are as cheap as they have ever been............all to the detriment of our local manufacturing industry.

You cant have your cake and eat it too !

[BHDOGS]

surprised no ones mentioned the 130 billion worth of assests hockey is pondering selling off for some quick cash.

[cheap]

Originally Posted by BHDOGS

surprised no ones mentioned the 130 billion worth of assests hockey is pondering selling off for some quick cash.

If you were in his shoes, given the situation , his options:

1) raises taxes
2) balance the budget from an accounting perspective. Quarantine the massive debt and only ever pay off the interest, leaving the debt to be serviced by generations of Australians.
3) sell assets
4) integrate with China
5) do nothing

Of course there may be other options, such as dismantle our way of life and implement some hypothetical Utopian system of government, promising good times for everyone (option 4 by stealth).

What else is he to do?

[Trump]

Originally Posted by cheap

If you were in his shoes, given the situation , his options:

1) raises taxes
2) balance the budget from an accounting perspective. Quarantine the massive debt and only ever pay off the interest, leaving the debt to be serviced by generations of Australians.
3) sell assets
4) integrate with China
5) do nothing
6) shrink government to half its size, remove all middle class welfare. Instant $200 billion saving
Of course there may be other options, such as dismantle our way of life and implement some hypothetical Utopian system of government, promising good times for everyone (option 4 by stealth).

What else is he to do?

In bold.

[TheSneakiness]

Originally Posted by DanielXR8

A truly aspirational future for us all you have painted there. Perhaps we deserve better. Perhaps two generations of Australian fought for something better, than giving the boss a great life, while everyone else competes to see whose life is crappiest as we mindlessly follow the American vision.

Yes, and so you should realise that because sooner rather than later you post will be fact. Are you ready for it? I'm betting not.

Unions may have fought for something better and now have lost. Everyone else lives by their day to day mindless job as you so put it because simply and bluntly put they have to. I would rather be a mindless drone than a white trash bogan living on $400 a fortnight.

[TheSneakiness]

Originally Posted by fte50

By the rest of us do you refer to the self employed ??
Yes, they don't get paid overtime, but can bag undeclared cash on a weekly basis.
Don't get paid to give blood, but claim expenses on their wifes car.
Don't get leave loading, but claim and receive a hefty tax return.
And the list goes on ..Give it up champ.

I do totally agree with your points on some peoples lack of work ethic though.

Yes and no, I feel sorry for self employed people because they have to deal with the likes of the workers at Toyota if they even need those people at all.

As a mindless drone in a truly global company my conditions are as follows

- 4 weeks leave a year
- 10 sick days (two consecutive day must be accompanied by a doctors cert)
- Super as per Aust Government guidelines

That's it. None of this leave loading, overtime bonus, RDO, etc etc.

This is why I cannot stand reading about other workers who complain about their positions despite being far better off than other workers.

[zilo]

Originally Posted by BHDOGS

surprised no ones mentioned the 130 billion worth of assests hockey is pondering selling off for some quick cash.

Spot on, the Libs will sell, sell,sell infrastructure assets and then claim good economic management credentials.

Same old, same old story...sell off the family farm till there's nothing left to sell.

Medibank will be the first to go....

http://www.youtube.com/watch?v=yoC67sZzUcs

at 4:00 he is asked directly...

[MAD]

Originally Posted by zilo

Spot on, the Libs will sell, sell,sell infrastructure assets and then claim good economic management credentials.

Same old, same old story...sell off the family farm till there's nothing left to sell.

Medibank will be the first to go....

Yep, and it's working great for everyone except the Government, and the people.

[BHDOGS]

I'd rather pay more tax then sell stuff one can be moved up and down assets cannot everytime Something's privatized it ends up costing more for the same service it never goes down

[jpblue1000]

I agree our public service is pretty big at near 1.9 million people. I don’t know what they all do, if any employees they actually produce anything of added value rather than serve and manage (that is not an attack but a question as to what industry the government still runs on our behalf)
But if you think the economy re-absorbing 30,000 car manufacturers maybe 200,000 total is tough think about near 1 million more. It’s a multi-generational change, and I’m not sure it’s one most people want. As posted elsewhere what services do Australians chop? What you think is a waste another sees as beneficial. We live in a democracy for better or worse and the committee rule that subjects us to ties us in inefficient knots.
It is evident there is no one reason for the auto industry dying, the mentioned 'perfect storm' of time, complacency, lack of support and alternatives etc, etc led to where we are today.
The real 'Australian disease' will be expressed in how we deal with the fact. Blame, finger pointing, aggression, negativity and self-interest, that’s the Australian disease so abhorrent.
What did our parents tell us when we were young...Pick yourself up, dust yourself off and get on with life. A healthy, sensible people will do just that, Australia may climb further up it's own asses. We are lost, confused and conflicted for not one reason but again that conflagration of events and reasons.
Australia the 'Lucky but Dumb' country.

JP

[XWGT]

There is another way to view this and that is a concept of resource redeployment for great profit rather than output shrinkage.

All in all the industries the current labour, R&D and activity base are engaged in are all in negative territory. Toyota losses on its exports, Ford and GM report huge losses. There is a an enormous amount of activity to basically make huge losses.

If the same labour and R&D investment from those industries can be moved into other more profitable industries then it can actually be a net benefit to the economy.

So the areas that could be expanded and improved upon may include the design, manufacture and support of heavy vehicle engineering, medical hardware, complex instruments, ship building (yep the world still builds lots of warships), military manufacturing (the world loves expensive hi tech equipment), pleasure craft, exploration vehicles and technologies, etc etc. There ARE industries out there with global opportunities that we would be competitive in due to the high value of the R&D and technology and our design capabilities.

The question is do any capital investors have the vision to take them on, and do we have a government who could help get them established and moving quickly (2 - 3 year time frame), or will we just wallow and whinge about it and let the opportunities pass us by?

[ryeman]

Originally Posted by CAMS290

From Terry McCrann, Herald Sun 11/02/2014

THE Australian car industry; born in 1948; died in 2017; just failing to make it to the biblical lifespan of three score years and ten.

Its birth was driven by an odd mix of war-driven fear and post-war exuberance; its death comes from a lethal cocktail of forces after a long, excruciatingly lingering illness.

WHAT NEXT? SHOULD THE GOVERNMENT DO MORE? SCROLL DOWN TO LEAVE YOUR COMMENT ON THE FUTURE OF AUSTRALIAN MANUFACTURING

And so Australia will join Saudi Arabia as the only two countries in the G20 without a domestic car manufacturing industry.

In a somewhat embarrassing irony, the announcement that ended any last remaining hope of the ‘new boy’ on the (down-under engine) block hanging in, after the two once-were giants of the global car industry scuttle back home to Detroit, came barely a week before Australia hosts the G20 in Sydney.

NEWS REPORT: TEARS FOR TOYOTA

Now, there is going to be a torrent of words written, said and indeed shouted about who and or what killed the car industry. There will be droplets of truth scattered among the waves of misunderstanding and emotion, spin, outright lies, blame shifting and attributing.

At core the truth is all-too simple: the car industry has been living with a terminal illness since the mid-1980s. The illness, long relatively dormant, turned aggressive when China set fire to our resources sector after 2003.

That sent the dollar soaring and, less obviously, put a floor under wages and conditions that the resources industry could afford but manufacturing could not. All manufacturing got hit by the perfect storm of seemingly ever-cheaper imports and sustained high costs.

Further, on a number of levels, the industry simply refused to take the medication that could have extended its life. And by the ‘industry,’ I mean both workers/unions and management.

In short and bluntly, faced with all this, the ‘industry’ committed suicide.

The one interested party that can’t be blamed is the new federal government. Throwing tax money at the producers would not have saved them or the industry; not so long as the four core realities persisted, as they inevitably, irresistibly, were going to.

These were the small production runs, the high value of the Aussie dollar, the absence of any protection against imports (a 5 per cent tariff might as well be zero, and should be now), and the union refusal to embrace massive and revolutionary reform of working conditions.

In the most direct way the workers and the unions at all three companies, Ford, Holden and Toyota voted to keep their working conditions over keeping their jobs. And in the process, they have condemned the jobs of all the other workers among the parts makers.

That said, it might still have been just too late — the individual producers have arguably each passed their individual points of no return.

Ford’s sales of the Falcon had fallen so low, and its prospects of future sales were so dim, it would have been ludicrous for it to contemplate the investment to retool for a future model. And if it was not going to make the Falcon, what would be the point of making a generic world car in Australia?

Much the same goes for Holden, although it arguably still had the basis of a viable indigenous car — the only real point of having an Australian car manufacturing industry. For the Commodore aside, what on earth would be the point of making the same car in high-cost Australia that was being made in Thailand, Korea or even China?

On paper the departure of Holden and Ford could have broken either way for Toyota. That it could scoop up 100 per cent of the demand for an indigenous car, and so get some scale; or, as is the case, the extended links with suppliers became unsustainable when they lost Holden’s demand. The particular problem is that unlike Holden and Ford, Toyota never had an indigenous car. Most of its production is now the globally generic Camry.

In the dying but still living industry of the past decade, Toyota was able to — just — make sense of building some of the Camrys in Australia and sending most of them to the Middle East.

To digress, it might be a fantasy of mine, but arguably if Toyota had quit first, Holden might have been able to make the case for staying on the 100 per cent indigenous car market share basis. But then only with sweeping reform of its industrial relations; and then, perhaps some help from Canberra. But as it stands, for Toyota, just like the other two, it’s impossible to commit to making a global generic car long-term in Australia, when you can make it significantly cheaper somewhere else. But also, when the Australian market is completely open to imports, as a totally bipartisan policy, whichever side is or was actually in government.

Let me add, I am not saying we should have maintained the outrageously high tariffs and other import bans of the ‘good old days.’ That would have made any reform of work practices in the industry impossible; and that would have been very corrosive across the rest of the economy.

It is a matter, though, of degree.

We should not have cut tariffs to just 5 per cent; they could have stopped at, say 20 per cent. And we have always been ludicrously and embarrassingly naive in negotiating so-called ‘free trade agreements’.

Now there is no going back; not between now and 2017; and certainly not after that.

Once the three of them go, they won’t be coming back, ever. And nor will anyone else.

And in the Fairfax papers today Toyota states the 'benefits' Hockey claims were the problem totaled $147 per vehicle.
How many would reject any car for that amount?

[b0son]

I think you have to be realistic. Toyota are defending its workforce because they don't want any disputes, stoppages, etc. At the end of the day, we know they tried and failed to have the EBA renegotiated and announced a closure soon after.

SPC have done much the same in defence of their workforce, deliberately citing very specific examples of loadings, rates, etc to try and defend their position. But when you consider the big picture, there really is no justification for propping up their wages with taxpayer funds when the business down the street has a productive workforce on award rates.

http://catallaxyfiles.com/2014/02/02...ise-agreement/

[cheap]

Drastic times require drastic measures.

I heard that Australia will join Saudi Arabia as being the only G20 member countries without car manufacturing facilities...

We've traveled along way down the road to ruin and the major parties still can not see eye to eye and repeal the CO2 tax what more will it take before this cancerous tax goes?

[SB076]

Rather than play the blame game I would prefer all parties sit down and see what they could have done differently that might lead to a different outcome, otherwise we are bound to lose more industry.

[SB076]

Originally Posted by jpblue1000

Don’t confuse manufacturing and industry. Twenty years ago, manufacturing provided one in every seven Australian jobs, about 13.5 per cent. Today it's 8 per cent.
The vast majority of our 'industry' is service based for better or for worse. Not all service based industry is internal and self servicing.
My service based business exports globally.

However based on what I have read today I am not sure the service or agriculture industry will be able to absorb the displaced manufacturers as they also face automation and significant generational job reductions.

Your point is valid however. Who pays for the goods machines make? and do th emachines pay enough tax to provide welfare to humans?
JP

I don't think the service industry is immune to what is happening. For instance how do you think you would fare competing against a similar qualified personal to yourself, but based overseas?

I know a few large companies that have outsourced the entire accounting department off shore.

Manufacturing is an important industry (before anyone starts all industry is important) Studies have been done that show every one manufacturing job spins off 5 other jobs.

I was lucky to go overseas last year and see what governments were doing to entice business (provide jobs) I think as we got through the GFC better than most we are a bit more complacent (in our policies etc)

[mik]

Originally Posted by zilo

Spot on, the Libs will sell, sell,sell infrastructure assets and then claim good economic management credentials.

Same old, same old story...sell off the family farm till there's nothing left to sell.

Medibank will be the first to go....

http://www.youtube.com/watch?v=yoC67sZzUcs

at 4:00 he is asked directly...

I don't think it matters much now, all parties and leaders have contributed and steered us down this path over 4 or 5 decades,
and looking at the the former govco, their 6 years in office, it looks to me like they have put as many nails in the Australian economic coffin as those in previous power for decades.

As for assets being sold off, mate they have sold every thing else off, might as well finish the job.

look back at the unmitigated disaster of the previous six years of the former govco, seriously,

mate, we will be paying for their disastrous reign for probably decades,
that is if we ever recover, and i doubt that.
as for the current mob claiming good economic management credentials at the end of term, that remains to be seen.

[mik]

Originally Posted by b0son

I think you have to be realistic. Toyota are defending its workforce because they don't want any disputes, stoppages, etc. At the end of the day, we know they tried and failed to have the EBA renegotiated and announced a closure soon after.

SPC have done much the same in defence of their workforce, deliberately citing very specific examples of loadings, rates, etc to try and defend their position. But when you consider the big picture, there really is no justification for propping up their wages with taxpayer funds when the business down the street has a productive workforce on award rates.

http://catallaxyfiles.com/2014/02/02...ise-agreement/

indeed mate , the big picture, ford, holden, toyota, qantas, spc, alcoa all in different stages of economic difficulty and probably many many more we don't even hear about.

[jpblue1000]

Originally Posted by SB076

I don't think the service industry is immune to what is happening. For instance how do you think you would fare competing against a similar qualified personal to yourself, but based overseas?

I know a few large companies that have outsourced the entire accounting department off shore.

Manufacturing is an important industry (before anyone starts all industry is important) Studies have been done that show every one manufacturing job spins off 5 other jobs.

I was lucky to go overseas last year and see what governments were doing to entice business (provide jobs) I think as we got through the GFC better than most we are a bit more complacent (in our policies etc)

You are absolutely right and that’s what I said. traditionally manufacturing absorbed displaced agriculture workers and more recently service industries absorbed the displacement of manufacturing in providing employment. Today, unique in history, I don’t think either can provide long term refuge for any other sector employees. All are suffering massive staff downsizing due to technological automation, robots and software. I believe it to be true that our children will be doing jobs we haven’t thought about yet, and the economy needs that otherwise there is nobody to buy stuff.

Your question about my competition with overseas competitors while holistically I agree, like for like skills, service and all the other guff etc the cheaper fee will win out. Where I believe Australia should head as a manufacturing base and where I have personally gone is into high end, complex, ultra specialist products or services. I survive because not many people in my industry, globally, can do what I do or have the experience and knowledge I have. Probably 1-2000 people globally which is pretty niche but I will admit won’t last forever as the world doesn’t need what I do as much anymore as there is only so many widgets the world needs. But I should see out my days doing this.
JP

[Trump]

Now this:

http://www.theage.com.au/business/th...213-32jqx.html

[gtfpv]

they could always stand down ingovt and let labor take over and re introduce an employment agenda , starting with science , and big business taxes . throw some $$$$ out there to save some companies and introduce new innovative economic energy investment , all being financed by revenue created by resources and banking taxes and essential services .
but that would be too easy , and further more , it wouldnt allow individuals to rip our wealth away and take the profits of our soil .
SOMEONE HAD TO SAY IT .

GOING BACK TO BASICS LEFT WING - WORKERS PARTY .
RIGHT WING - MANAGEMENT PARTY

[gtfpv]

We all know the quick buck = the quick f . any govt that does this , no matter who they are . is trying hard to rape everyone

[Grunter]

[zilo]

Originally Posted by cheap

Drastic times require drastic measures.

I heard that Australia will join Saudi Arabia as being the only G20 member countries without car manufacturing facilities...

We've traveled along way down the road to ruin and the major parties still can not see eye to eye and repeal the CO2 tax what more will it take before this cancerous tax goes?

CO2 tax?

Where in the hell did you get that as being of any consequence?

Ford, Holden and Toyota have all said that the carbon tax had absolutely zero impact on their decisions to pull out...

[MAD]

Originally Posted by Grunter

image

If only it were that simple. I'd be first to take the step

And if only it had the same consequences for the 'leader'

[blk6t]

I don't see how this article or the closure of all three car manufacturing plants can be a big shock or surprise.

Were not a competitive manufacturing nation, living in Australia is expensive and the Aussie lifestyle were all accustomed to is of high standard, we cannot compete.

Whilst it's an impact on our economy, cities like Sydney are not too dependant on manufacturing (even though Sydney clipped Melbourne for manufacturing of recent, mostly high tech), Sydney has diversified into a financial hub. I believe someone said earlier all these are "nothing" jobs, well financial hubs are usually the driver and controller for growth wether investing locally or internationally.

Our government needs to focus on shifting our economy into areas where we have the ability to compete. There are lots of thriving economies that do not rely on manufacturing and resources. Our economy needs to be adaptable, which means skills training in growth economies.