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dump the subsidies to the big miners « Previous | |Next »
March 23, 2012

So Holden will only stay in Australia and produce cars if it is subsidized by the federal and state governments. These days the subsidy is badged as co-investment---a strategic co-investment, not a handout says the PM.

PopeHolden.jpg

From what I can gather manufacturing is being hammered by the high dollar, and Holden General Motors would have left town without government subsidy. Its a strange old world isn't it when governments pay the big miners making super profits from the mining boom a diesel fuel tax rebate that now costs the federal government about $2 billion a year.

Pulling the plug on that rebate to the big miners--not just tighten it---would be a good way to address the ongoing problem with revenue shortfalls and help bring the budget back to surplus. It represents spending cut which is what will be needed to get the budget back to surplus.

In The Australian Judith Sloan critiques the propping up of the car industry from a neo-liberal perspective. She says:

let the car firms get into shape and, if they want to quit Australia, let this happen. We can then devote resources to assisting the displaced workers. With unemployment close to 5 per cent and structural adjustment creating jobs in other sectors, the timing is close to perfect. Alas, the government has come to a fork in the road and taken the wrong path. By propping up an uncompetitive industry and sucking resources from elsewhere, we are all poorer and less equipped to meet future challenges.

She doesn't mention the subsidies to the miners or the aluminum or coal industry. Presumably these are competitive industries, whilst the car industry isn't? So the issue isn't government intervention per se that is the problem----it's the protection of uncompetitive industries.

| Posted by Gary Sauer-Thompson at 2:24 PM | | Comments (5)
Comments

Comments

Perhaps it would be fairer if the goverment paid the buyer $1000 for buying a locally made car a let the punters decide which plants stay open and close based on quality and value for money.

As a protectionist and anti so-called free trade type my immediate reaction is to tell GM to piss off.
Judith Sloan seems to make sense [blimey is that a first for the OO?].
But a bit of nuance might be called for. Might be.
I saw recently somewhere that 80% of one category of 'home-made' car 'made' in Oz was purchased by Oz govts.. Which of course is reasonable but the writer seemed to think, possibly correctly, that such was an indictment of the inefficency of Oz car manufacturing and govt policy.
The thing is there is no real reason, the high $ is pretty much irrelevant, why Oz home made cars cannot be successful on a range of criteria eg Oz content/fuel efficiency/sales/profitabliity/manufacturing efficiency etc.
We have the market.
People forget, or choose to ignore, that whilst only 23 million people we are an affluent car crazy mob with a unique geography that supports vehicle transport more than most countries/regions. And we have the technology, the raw materials, the capital, the skilled labour force, in short all the necessaries for a successful home grown vehicle industry.

So something is clearly wrong.
What is it, singular or plural, and what can be done about such?
Well I would suggest that having our 'home made' industry owned and controlled by foreign companies who fit our industry into their transnational interests and bugger the best interests of Oz, is a major factor and one we can well do without and are perfectly capable of doing so.
So piss off GM.
Another problem however is exemplified by the current issue namely governments that are enslaved by those TNCs and can see no other solution but to kowtow to them. The decades long abasement to Misubishi and Chrysler before them [remember them?] being one of several such examples.
So a change of policy is also necessary.
Lets start small.
OK GM you can have umpteen hundreds of millions of dollars. But in return we want .....
Hmmm.
Control of the local company euphemistically known as Holden.
GM's agreement to a range of protectionist measures that will make the new Oz genuinely made, and owned, car safe from TNC mnipulation of the transnational markets.
And a few other [better thought out] elements.
And if GM, and their other TNC mates, can't come at that then they can piss off.
But they can, and will, leave our [note that word] factories and intellectual assets behind where they belong for us. We earned them.


Won't happen.

I just see it as a balancing-out
of the two speed economy.
Christ, if idiots like Rinehart and Palmer can sit on $billion's, what so wrong with tens of thousands of Aussie workers, often with good technical skills and their families benefiting from a bit of trickle-down?
It's a coded warning and thus good policy. The industry is being slowly wound down,but not at the dislocative rate advocated by sado-economists.
Rofled at another site where the Dickensian Rush Limbaugh stuff about my,
"tax dollars saving someone else from starving to death so I have to postpone the purchase of the new 4WD for another few days.. "
stuff had me regurgitating my smoko tea and black and gold scotch fingers

Totally on side with Fred. The New Right era of privatisation & deregulation has left us feeling that publicly-owned and operated enterprise is somehow "dirty" - like economic porn or something. It isn't, and we should be working to rebuild a significant degree of public ownership in quite a number of areas. I nominate (off the top of my head) banking and housing.

And I look forward to being able to buy a National Holden (or whatever it ends up being called).

The big guy says,
There is going to be heaps of jobs in Queensland now the LNP has taken over.

The lady says,
Thats good coz we will all need two.