“Our Elite Are Pursuing… National Self-Sabotage”

1 Mar

MacroBusiness principal David Llewellyn-Smith has today published what is, in this blogger’s opinion, arguably the best article yet written about the way in which the Australian political and bureaucratic elite have pursued a deliberate policy of reshaping the economy.

A “must read”, and a “must share” article (excerpt below):

Just two days ago, Prime Minister Julia Gillard announced that:

“We can still be a country that manufactures things. But we’re going to have to do it differently”

She was spot on, if by differently she means we’ll make things without investing any capital. That will be very different indeed.

The truth is Australian manufacturing is not adapting, it’s being wiped out. It’s not restructuring, it’s flat out collapsing. Yesterday’s private capex survey was a bloodbath, sending manufacturing investment intentions back to levels last seen in the 2001 global recession, and first seen in 1989. And that’s in nominal dollars. Inflation adjusted is far worse. In the following chart of capex intentions, the arrow points to expected spending levels for the next year:

Screen shot 2013-03-01 at 11.06.47 AM

It was not always thus. It’s easy to forget, especially with a gorked media, that manufacturing’s proportion of capex matched that of mining until 2004:

Screen shot 2013-03-01 at 11.07.03 AM

But now it’s all about the dirt:

Screen shot 2013-03-01 at 11.07.23 AM

That’s fair enough. This post is not about bashing mining. What it is about is imbalances.

Australia’s economic elite – public and private – are engaged in a grand experiment. They have decided, in their wisdom, to delete Australia’s industrial base and replace it with mines.

And there is another argument worth considering. Without a manufacturing base, how does a country defend itself? Sure, production can always be ramped up if needed in a time of strife. But not if you no longer posses the human capital to do it. The death of manufacturing is the permanent loss of the skills and intellectual property that enables such a ramp up to occur. It will be a short meeting when our enemy’s generals sits down to plan which industrial targets to bomb.

The various imbalances created by the annihilation of Australian manufacturing are neither inevitable nor benign. Our elite are pursuing one of the great experiments in national self-sabotage.

Read the entire article at the link.


3 Responses to ““Our Elite Are Pursuing… National Self-Sabotage””

  1. Kevin Moore March 1, 2013 at 2:06 pm #

    The worlds economic order is servant to the lender.

    The Story of the Commonwealth Bank

    A study of events leading up to the establishment of the Commonwealth Bank, and subsequent developments, provides an understanding of a vital, but
    comparatively little-known part of Australian history. Events since the publication in 1948, of the twelfth (revised) edition of The Story of The Commonwealth Bank, have both
    highlighted how the bank could have been used to serve the Australian people, and the authors fears about the implications of acceptance of the Bretton Woods Agreement in 1947.
    Much more is known today about the long-term strategy of those international forces which created the International Monetary Fund and The World Bank. For
    example, with the emerging programme to establish a New International Economic Order, it has been revealed that the British economist, John Maynard Keynes, who played a
    major role in preparing the Bretton Woods Agreement, had in 1942 drafted a memorandum – The International Control of Raw Materials.
    This memorandum, listing those commodities which Keynes felt should be under international control, remained unpublished until 1974, the year when the United
    Nations made its Declaration for a New International Economic Order. Another influential architect of the Bretton Woods Agreement was Harry Dexter White of the American
    Treasury. White was subsequently appointed as an American Director of The International Monetary Fund. White allegedly committed suicide when he was exposed as a top Soviet


  2. mick March 1, 2013 at 5:06 pm #

    Both sides of politics are happy to sell out the nation. If mining income every stumbles the nation will be dead in the water but what do our elected officials care. Most are there either to get their overgenerous self determined superannuation or to do the bidding of their political masters, the brain dead business Australian lobby, not to look after the future of the nation. We will all suffer in time.

  3. Paul March 2, 2013 at 8:22 pm #

    Lima declaration. It is being fulfilled as demanded.

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