Sunday, February 2, 2014

enough to give you the pip

What we now know as the Euopean Union has been formed and re-formed for decades. One of its predecessor organisations was the European Economic Community, born in 1957.  

After much hand wringing, the UK finally signed up to the European Union in 1973.
[The EU's history is not only a complicated history, but a boring one. Forgive me if I don't check facts/say more and thereby increase the chances of making some glaringly obvious mistake.]

Originally, dumping [before true globalisation happened] was the means whereby European states [e.g. Germany, amongst others]
  • made sure they still had an agricultural community to rely on
  • prevented millions of suddenly redundant farmers walking off their land and heading straight to cities in search of non-existent work
by subsidising agriculture i.e. paying farming families to stay put.

Surplus agricultural product was sent to a range of third-world countries and territories, allowing dumper countries to provide millions of dollars of "aid" to dumpee countries. How very white of them.

But, the EU has had an anti-dumping policy for yonks now.
After all, how can an industry be efficient when it is competing with dumped produce from all over Asia?

People were commenting a few years ago about cheap banananananas from the Philippines wreaking havoc with Australia's banana industry. My general thoughts on the matter have long been that even Asians have to eat, surely we could channel our "smarts" into an industry where poorer people/nations can't compete?

Sigh. Pity there is always a difference between what should be and what is.

When it comes to the question of subsidising SPC – a major employer in the heart of Victoria's fruit bowl, I'm torn.
a) like electricity, water supply and shipping/rail/transport infrastructure [stop laughing Andrew, this is serious] Australians must share responsibility for the maintenance of essential industries and services. Agriculture is part of this.
b) why the heck should Australians subsidise private corporations like Coca-Cola?

Let's start with the human side of the story:

As those lying one eyed Un-Australian pinkos at the ABC put it,
In recent years a wave of refugees from Sudan, the Republic of the Congo, Iraq and Afghanistan has diversified Goulburn Valley's vibrant community.

A study sponsored by the Dept of Immig in 2012 says:

About 11 per cent of the population were born in a country other than Australia, with almost 8 per cent coming from countries where English is not their first language. Many of the refugees who came to Shepparton have settled in the area, enjoying the rural lifestyle and the opportunities for seasonal and permanent work.

The major employment opportunities in Shepparton and the region are in agriculture, food manufacturing, retail, health care and social assistance.

The region is a major producer of fruit and vegetables and refugees are often employed in this industry. Peak time is in the warmer months between November and April, and the work usually involves fruit picking. It is accessible to women and men from all backgrounds, regardless of their English language ability. A high number of people come to Shepparton during these summer months to work in this industry. Transport may be provided for workers between Shepparton and the orchards.

Those with higher levels of English-speaking skills will have opportunities to apply for work in the manufacturing industry. This work is usually preserving and packaging fresh fruit.

Figures I've been able to dredge up tell me Shepparton's resident population is about 63 000. If 10% are not Australian born, it's not hard to believe the number of 4,000 Iraqis resettled in the Shepp/ Kyabram area between 2001-2003.

Now there's the irrigation side

Some people call it "trickle down economics". The rich get richer, spend a dollar here and there, and the poor get not so quite poorer.
Some people talk about flow on effects: People employed [whether in subsidised industries or not] pay taxes, and they spend money in shops and on services etc and the money goes round and round.

Orchardists in the fruit bowl area have been ripping up thousands of trees a year for years. [a significant loss of capital.]

The corporate [i.e. artificial person] side of the story

There is a basic conflict between state accounts and federal accounts. States have a vested interest in competing with other states for funds. Federal governments have a vested interest in sucking up to this or that corporation.

Mining is subsidised to the tune of billions. Okay, it's an essential industry, but is there a limit to how much mining we need. Is nobody going to acknowledge the damage the mining boom has done to other Australian industries? We've gone beyond a pig-iron Bob mentality to a pigs at the trough mentality.

Some organisations in the past, such as Bonds or Kodak have taken enormous bonuses from government and then a year or two later shut shop and cashed up all their onshore assets. All I can say to that is that a bank does not lend money without a mortgage on assets, what the heck is wrong with some governments?

Some industries – vehicle manufacturing amongst them – generate greater income through wage taxation than they cost in subsidies. Many such industries are essential, because we need to maintain capacity and skills.

Tony Abbott, may his government soon rest in peace, made the valid point at wherever it was a few weeks ago that, in a global economy, nations should get their acts together and do something about companies that avoid paying tax in the country where they generate their profits.

That aside, instead of privatising essential services, governments should be buying into essential services.

Perhaps you are sick of the word Myki… I know I'm sick of whingeing about it. But it's a prime example of something stupid at work here. Employing people to sell tickets, if we fine tuned the wages end, would be a really really good work-for-the dole scheme. Ditto buying SPC from Coca Cola.


  1. America, home of laissez faire capitalism, virtually bought into the car industry and private financial institutions to save them. Other countries at times don't accept new technology when it will replace basic workers. The know they have to keep low paid jobs for the population when there is no social security.

    Australia seems to cut worker numbers but increase management numbers. The layers at my work have to be seen to be believed. No doubt each will be able to justify their jobs, that is they keep busy enough, but doing what really?

    1. Andrew, if the US is the home, I sometimes get the feeling Australia is the dunny.

      Or, to paraphrase the cliche, who shall manage the managers?

  2. ...even Asians have to eat. :) Do they now? jk
    Oh gosh it is one messed up world isn't it. I pretty much have given up on it. The only box I get on anymore is on my blog on HCV. But thank God someone, like you, keeps tracks of what's going on or who knows what "they" would really be up to.

    1. Rubye, you are doing a lot to keep track of things and get the word out about something as important as everything else, and you are doing so from a position of inside knowledge. More power to you.

  3. oh I despair. re Kodak subsidy: a car dealer said at the time everyone in management bought a new car. must not have been Holdens though.
    More history re tax and where it is paid: Business journos smirked years ago when an Australian woman purchased ebayAustralia for $4million. must be worth 400 mill now, and they bank in Switzerland.
    When those war-traumatised Sudanese in Shepp have no jobs, they could revert to their old life with the machetes etc. Cennalink branch might be a dangerous place to be.
    If food packaging ceases in Shepp, a negative flow-on effect at amcor or Containers Ltd might be interesting. oh wait CoCoBottlers owns one of them too. Richd Pratt doing voodoo from The Hereafter in revenge for their carton price fixing swindle. did I say I despair?

  4. The whole Kodak thing I took very personally, organised as it was by a popular, former PM who had parachuted into the Kodak electorate. The doors slammed shut within days of him losing his seat. As if camera film was not already an anachronism.
    Everytime I think of the name Pratt I think of Raheen. Every time I think of Raheen...

  5. I am falling asleep and this very good post needs more attention. We need manufacturers but the problem of high wages has to be addressed.

    1. Perhaps you'll sleep on it for us, Diane?