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Tannin 
Can't remember
Joined: 06 Aug 2006
Location: Huon Valley Tasmania
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| pietillidie wrote: | | given the structural reforms Hake implemented |
This would be the famous Fisheries Reform Act (1987), I presume.
(Sorry. It was a damn good post too, PTID.)
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�Let's eat Grandma.� Commas save lives! |
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pietillidie
Joined: 07 Jan 2005
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HAL
Please don't shout at me - I can't help it.
Joined: 17 Mar 2003
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Wokko 
Come and take it.
Joined: 04 Oct 2005
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2 term, 6 year Labor Government - Dindu nothin wrong
2 year Liberals - GUILTY! BURN THEM!
I think it's time to merge every anti Liberal thread because they're all the same. |
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Tannin
Can't remember
Joined: 06 Aug 2006
Location: Huon Valley Tasmania
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| Wokko wrote: | 2 term, 6 year Labor Government - Dindu nothin wrong
2 year Liberals - GUILTY! BURN THEM! |
Correct! Well done. We will make an economist of you yet.
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�Let's eat Grandma.� Commas save lives! |
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pietillidie
Joined: 07 Jan 2005
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Indeed. The difference between the foolish and the wise is the speed at which the latter recognise, adjust and move on from sunk costs. The really stupid—I mean fruit fly dumb—learn nothing and keep reacting to the same things in the same way because whatever it is would surely have upset grandad.
Anyone for another Middle East intervention? Perhaps some more middle class welfare handouts? I know, let's encourage creativity and innovation in financial services, that worked a treat overseas. Or, how about hiring a team of consultants to conduct a "CBALOL" to see which version of the NBN will move the nation forward? Or, perhaps we can make education more expensive, pray to Jesus, and hope that miraculously that might lead to a rush on skill upgrades? Anyone for a Republican Party healthcare system? That's been tried and failed enough elsewhere to satisfy even the most fanatically committed to failure.
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In the end the rain comes down, washes clean the streets of a blue sky town.
Help Nick's: http://www.magpies.net/nick/bb/fundraising.htm |
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Mugwump
Joined: 28 Jul 2007
Location: Between London and Melbourne
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^ PTID, Whenever you don't have an answer to a question of economics, you get all sulky and start to lash out, so here we go again. Insult me all you like, but I'm still waiting for an answer about what this government might have done in terms of "risk management and mitigation" against the global commodity cycle. I'm hearing crickets, apart from your bizarre assertion that Abbott and co should have diversified the Australian economy in two years. When that is clearly untrue, you seem to think that because they were around in teh Howard and Costello government, they're entirely accountable for that era as well. Be as boorish as you like, it's no substitute for making a credible case that thinks beyond pre-digested ideology.
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Two more flags before I die!
Last edited by Mugwump on Sat Sep 12, 2015 3:32 am; edited 1 time in total |
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HAL
Please don't shout at me - I can't help it.
Joined: 17 Mar 2003
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| What if it didn't happen? |
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Mugwump
Joined: 28 Jul 2007
Location: Between London and Melbourne
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| Wokko wrote: | 2 term, 6 year Labor Government - Dindu nothin wrong
2 year Liberals - GUILTY! BURN THEM!
I think it's time to merge every anti Liberal thread because they're all the same. |
Yes, I have little time for Abbot and his government, and I would not vote for him. Yet Australia remains one of the richest, safest and most stable countries on the planet. To listen to some of the Ancient Mariners who grab the nearest lapel and insert their Abbott hatred into every complex political and economic question, you'd think he was an Australian Robert Mugabe.
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Two more flags before I die! |
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pietillidie
Joined: 07 Jan 2005
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| Mugwump wrote: | | ^ PTID, Whenever you don't have an answer to a question of economics, you get all sulky and start to lash out, so here we go again. Insult me all you like, but I'm still waiting for an answer about what this government might have done in terms of "risk management and mitigation" against the global commodity cycle. I'm hearing crickets, apart from your bizarre assertion that Abbott and co should have diversified the Australian economy in two years. When that is clearly untrue, you seem to think that because they were around in teh Howard and Costello government, they're entirely accountable for that era as well. Be as boorish as you like, it's no substitute for making a credible case that thinks beyond pre-digested ideology. |
I get annoyed because you're an institutional parroter.
I mean, is there any danger of you being able to mentally control for the factors which have nothing to do with Abbott and the Glibs so we can have a serious conversation? That's the assumed starting point here.
This may surprise, but given Australia is no longer a colony you're generally expected to analyse it within its own regional and local context.
And in that context, strengthening revenue streams such as tourism and education which benefit from a weaker currency in order to counter cyclical commodity prices is risk management. And making sure people have decent jobs and career prospects, that their wages are going somewhere other than in a downward trajectory, and that housing is affordable is risk management because such things are the basis of social stability.
And if that's a step too independent for you; if you didn't realise the term "risk management" has an approved meaning outside financial engineering, then I think I'll go and discuss the matter with a plush rabbit or a garden gnome.
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In the end the rain comes down, washes clean the streets of a blue sky town.
Help Nick's: http://www.magpies.net/nick/bb/fundraising.htm |
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Mugwump
Joined: 28 Jul 2007
Location: Between London and Melbourne
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| Tannin wrote: | It's not a dictatorship, Mugwamp. The PM and the Treasurer don't get to decide everything. They are merely first among equals in the Cabinet and in the Party Room. The many, many Howard-era types still in the government today must bear a significant share of the blame which attaches to the Howard Government's failure to manage the economy with even basic competence.
But how significant is this failure? Is it fair to blame the government (any government) for the economy?
Yes and no. Governments generally don't do much that's good for economies (there are examples but they are rare exceptions); they can and do, however, do bad things. They can't generally help very much, but they certainly can do enormous harm - and that is exactly what Howard did. He utterly failed to manage the one-in-a-century opportunity of the mining boom, and he utterly failed to manage its terrible consequences - in particular the gross over-valuation of the $AU which crippled industries all over the country and for which we wil be paying for decades to come. (Rudd failed to correct that error, we should note.)
Secondly, he failed to use the huge short-term windfall income generated by the boom to do anything useful: he pissed it up against the wall of middle class welfare and tax cuts for the wealthy.
The result is that we now have a dysfunctional economy with bugger all manufacturing, with tourism and education still a long way away from recovery, with truly massive private debt (private debt in Australia is not far off the worst in the whole developed world), and with no productive assets worth mentioning with which to back that debt. Three quarters of the mining enterprises, for example, are now foreign owned. The same applies to what's left of manufacturing and agribusiness: you battle to buy a loaf of bread or a can of beans except from a foreign company. The one great asset class remaining in the hands of private individuals is real estate, and that is grossly over-valued and very, very vulnerable to correction. ("Correction" in this case is a term equivalent to "massive crash". Bricks and mortar make good investments generally, but not when the price you pay for them is inflated by a factor of three, not when the money you bought them with is borrowed, and especially not when your other prime investment is super and your super fund depends very largely on the continuing profitability of the big four banks who are the very same ones most dangerously exposed to a real estate crash. Note also that all this over-investment in real estate is non-productive. You can't eat it, you can't wear it, you can't make anything with it, and unless you can find a bigger fool with even more borrowed money, you can't even sell it. |
^ I can agree with much of that Tannin, though I think you know well that economic policy is decided by the PM and Treasurer, not by ministers without a financial portfolio. You're drawing a long bow in the hope of hitting Abbott. He wil have much to answer for, but I don't think that the economic decisions of 2002-2007 loom large in the charge sheet.
On the mining boom, Howard and Costello deserve some blame, but the boom spanned the period from ca 2001-2013. Labour and Liberal governments shared it about equally, and both failed to make much of it.
Today's Australia is a conundrum. The distortions that you diagnose have been there for a very long time, yet they stubbornly refuse to unravel. I suspect the housing market is being propped up by immigration, Chinese owners seeking a safe haven, and the stupid tax arbitrage. I have long expected it to reverse, but it has not. Perhaps it never will , such are the powerful forces of buoyancy and the political incentives underpinning it. It may correct slowly, without sudden dislocation. Or it might go on to Chinese levels. Who knows ?
On foreign ownership, Rex Connor died years ago. All modern corporations have owners dispersed around the world. Australians own bits of US and EU companies, and vice-versa. The question is where they are headquartered, where they employ people, and where their taxes are paid. The cost of foreign ownership lies in the dividends paid, to the extent these flow out of Australia. These divs are not a major component of the overall revenue generated in Australia, and the capital inflow from foreign ownership means that resources get developed faster. Without foreign investment, I think we'd be a lot poorer.
I don't know if there is a future for manufacturing in Australia. As trade has globalised and manufacturing scale has become more important, it's hard to justify making goods in Australia, given its distance from major markets, high labour costs, manufacturing unions, and volatile currency. If there is, it has to be in high-technology, one-off goods where the cost of transportation and distribution is low relative to the capital cost of the item, or where a large part of the capital lies in intangibles (the software inside the engine, or whatever).
I do not know whether intangibles and services such as software, biosciences, education, tourism and niche, high embedded-value manufactures can sustain the Australian lifestyle in the long-term. I have my doubts, but there is no harm in encouraging them, and even subsidising them for a time to try and get them started. In that regard, I think Abbott's policy is wrong. But his government isn't really responsible for quarterly numbers that issue from judgements made by both sides of politics. That kind of foam-flecked ideological point-scoring won't move us forward. And trashing natural resources, when it's your main business, is just economic kamikaze.
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Two more flags before I die! |
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Tannin
Can't remember
Joined: 06 Aug 2006
Location: Huon Valley Tasmania
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| Mugwump wrote: | | I'm still waiting for an answer about what this government might have done in terms of "risk management and mitigation" against the global commodity cycle. |
- Not destroyed manufacturing industry. Abbott deliberately set out to smash the car industry. With the dollar AU at $1.10 US, the car industry was really battling. Gillard propped it up, negotiated with the manufacturers, spent what was needed. (Large sums, but trivially small in relation to the benefit - and significantly smaller than the taxation revenue forgone with the unemployment created.) Ford was always going to shut up shop, but Holden was willing to stay and Toyota eager to do so. And now, with the dollar at $70c, the industry would be cooking with gas. It's as massive employer because of all the feeder industries, and the industries that feed the feeder industries.
- Not deliberately smashed the renewable energy industry. Abbott's insane hate for clean energy saw the loss of 2500 jobs in 2014 alone and forward investments in future renewable generation projects fell 88%. Australia had the space and sunlight, the technology, the skilled workforce, the successful growing companies to make it a world leader in the booming renewable energy market - and that is a huge opportunity pissed up against the wall by Abbott and Hockey out of nothing much other than spite.
- Not created huge job losses in the public service and government sectors through the massive cutbacks of the Hockey budgets.
- Not crippled the most vital national infrastructure project of the information age.
- Actually done something (anything!) useful instead of concentrating on destruction of productive, valuable industry.
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�Let's eat Grandma.� Commas save lives! |
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Mugwump
Joined: 28 Jul 2007
Location: Between London and Melbourne
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| Tannin wrote: | | Mugwump wrote: | | I'm still waiting for an answer about what this government might have done in terms of "risk management and mitigation" against the global commodity cycle. |
- Not destroyed manufacturing industry. Abbott deliberately set out to smash the car industry. With the dollar AU at $1.10 US, the car industry was really battling. Gillard propped it up, negotiated with the manufacturers, spent what was needed. (Large sums, but trivially small in relation to the benefit - and significantly smaller than the taxation revenue forgone with the unemployment created.) Ford was always going to shut up shop, but Holden was willing to stay and Toyota eager to do so. And now, with the dollar at $70c, the industry would be cooking with gas. It's as massive employer because of all the feeder industries, and the industries that feed the feeder industries.
- Not deliberately smashed the renewable energy industry. Abbott's insane hate for clean energy saw the loss of 2500 jobs in 2014 alone and forward investments in future renewable generation projects fell 88%. Australia had the space and sunlight, the technology, the skilled workforce, the successful growing companies to make it a world leader in the booming renewable energy market - and that is a huge opportunity pissed up against the wall by Abbott and Hockey out of nothing much other than spite.
- Not created huge job losses in the public service and government sectors through the massive cutbacks of the Hockey budgets.
- Not crippled the most vital national infrastructure project of the information age.
- Actually done something (anything!) useful instead of concentrating on destruction of productive, valuable industry.
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At last, thank you. The car industry and public sector cutbacks are the major things which might be felt in the present economy. 2500 jobs in renewables matters, but it is not material in the context of overall employment. On the public sector employment cutbacks, I have the impression that most of them were in quangos, where there is no natural customer, so I suppose it's a matter of judgement. It is not a contribution to the economy to keep bureaucrats in jobs when they might be working in industry, possibly earning export dollars and being net tax contributors. No doubt they feel that their work was leading to tax revenues in the long run. No doubt we'll never truly know.
The car industry is one where i think you are probably right, though we'd really have to get behind the economics, look at the historic level of subsidies and returns, and take a view about the viability of this kind of manufacturing in the future. In general, countries do not become wealthier by indefinitely subsidising uncompetitive industries, but if it was just the currency effect, then I think a deal might have been a good idea.
Regardless, the main point is that Australia is a cyclical economy because its largest industries are commodity-based, which is probably a pretty sensible baseload position to have when you sit on one of the world's richest resource bases. Blaming a two year government for the economic cycle, rather than looking at the governments of the previous 20 years, is tabloid (and PM Questions) thinking.
I have no interest in being an apologist for the Abbott Government - they are clearly one of the nastiest and most ethhically-questionable governments Australia has had. Their position on climate change is irresponsible, their failure to address the housing crisis is disgraceful, and the increase in tuition fees - especially for STEM subjects
- was unnecessary and retrograde. They're a bad lot. But there is no point blaming them for the present dip in economic growth. It's like blaming the leaky tarpaulin for the weather.
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Two more flags before I die! |
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Mugwump
Joined: 28 Jul 2007
Location: Between London and Melbourne
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| pietillidie wrote: |
I get annoyed because you're an institutional parroter.
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 Yep, never had an original thought, sorry. I just wake up every morning and tune into "control headquarters" to be told what to parrot today. I know it's hard for you to cope with anything that questions your neat little categories, but do try.
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Two more flags before I die! |
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Wokko
Come and take it.
Joined: 04 Oct 2005
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My Two party preferred voting habits since I was 18:
(Too young in '96 but would've gone Howard)
Beazly
Howard
Latham
Rudd (Might've gone for Costello, but Howard was cooked)
Abbott
Abbott
3/3, but I'm a Right Wing Liberal stooge or some such nonsense. Also a party member of the LDP. Swinging voters are Right Wing Nazis around here it seems. |
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