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Why Shorten must win the Grocon battle

The muscle flexing going on at Grocon building sites is a reminder of how good we had it during what Tony Abbott calls the “golden age” of the Howard government.

In those days we could afford as many of these title fights as we wanted, and the economy would grow nonetheless. The mother of them all, the Patrick’s waterfront dispute, even made pretty decent TV.

But we can’t afford it now. Look at the competing forces in the economy, and it quickly becomes clear that a major escalation in building costs — Grocon says it’s losing $370,000 a day just at the site in Melbourne’s Lonsdale Street — is a golden-age-luxury we can’t afford.

Australian Mines and Metals Association director Minna Knight yesterday warned that this kind of dispute would deter inward investment, including $260 billion in resources projects.

That claim is a bit overblown, but when Knight’s comments are put alongside falling commodity prices, it’s easy to see how much damage the CFMEU can inflict on Australian growth. Overseas investors, including our biggest miners, must revise their forecasts not only for iron ore prices nearly 40% off their peak, but for the risk of rolling industrial action.

The abolition of the Australian Building and Construction Commission has clearly emboldened the CFMEU, whatever its leaders say, and industrial relations minister Bill Shorten has the urgent problem of breaking up this dispute to keep some kind of fig leaf over Labor’s embarrassment.

But his is not the biggest problem. While Tony Abbott is happy to say the ABCC “cop” must be put back on the beat, there is no ducking the fact that industrial action under an Abbott government would return to something like the “golden age” disputes John Howard and Peter Reith fought.

Why? Because at heart these battles are not about workers’ rights — other than workers’ right to be part of a potent power bloc in Australian politics. While the Gillard government hangs on, the bald power plays of the CFMEU leadership will at least be heard in Labor boardrooms. Under Tony Abbott they will not.

The risk is that in just over a year’s time, a perfect storm will blight the economy — tumbling commodity prices, ravaged public finances, increased labour costs putting an extra brake on infrastructure projects, and industrial anarchy. If that combination arrives, the Australian economy would look more like the early-1990s than the full employment growth story of today.

The big difference is that in the early 1990s, the “golden age” lay ahead of us. For some time I have argued that only the opposite looms for us now: a top heavy demographic profile with burgeoning health-care bills, the golden goose of the resources sector rapidly being replaced by overseas geese or just being hit by softening demand (hence the dropping prices), and in particular, a public debt position that we simply will not be able to address in years ahead.

The Keating public debt that John Howard heroically paid off during mining-boom mark-one, was smaller than the 10% of GDP our federal government now owes. When the state debts are factored in, we’re well above 20% of GDP, and that’s before our private debt bubble in the housing market is considered.

Whether or not Knight’s predictions are correct for the resources sector, an incoming Abbott government will be slashing public spending, and public service jobs, to try to balance the budget just as unemployment is naturally rising anyway. The vicious circle of slowing business activity, slowing tax revenues, and rising unemployment will do its work, and we won’t be back in the golden age of the late-noughties — more the “rust belt” blight that characterised the Victorian economy in the late 1980s.

The CFMEU leadership won’t be worrying it’s pretty tattoo’d head over that kind of scenario — union leaders, if not the workers, prosper during times of mass unemployment.

The onus is now on Bill Shorten to prove that Labor can smooth over the Grocon dispute without the ABCC. If he does, Abbott will take the blame for the coming industrial shocks. If he doesn’t … what does it matter? The unions will get the power they crave, and their members, along with the rest of the country, will suffer the consequences.

*This article was first published at Business Spectator

42
  • 1
    fredex
    Posted Thursday, 30 August 2012 at 9:50 am | Permalink

    When did Rupert buy Crikey?

  • 2
    Suzanne Blake
    Posted Thursday, 30 August 2012 at 10:43 am | Permalink

    If the workers at the site don’t want to be part of a Union, why is that an issue?

    They will have seen what happens at the HSU, AWU, ETS and said, we don’t want to be part of that.

    Its a free choice.

    Shorten is concerned as Union members makes up 15% of the workforce and it shrinking fast. Their power base is eroding and the troughs are being removed.

  • 3
    Frank Campbell
    Posted Thursday, 30 August 2012 at 10:52 am | Permalink

    Yes, Fredex, Crikey is looking increasingly schizophrenic since its Kohler associates were bought by Murdoch.

    But the ideological fault lines were there all along.

    Crikey is an incoherent gaggle of ex-bureaucrats, corporates, castrated Marxists and climate zealots. Bewildered Old Labour stalwarts flounder in the wake.

    Crikey has never had the slightest comprehension of corporatism.

    Peter Martin’s piece reflects Murdoch corporatism, in which unions are tolerated only as a device to ensure a domesticated labour force. Martin never says what the Grocon dispute is about. Martin never mentions the fact that Australia (especially Victoria) was in the early 90s in the grip of a severe recession. All Martin does is to raise the spectre of tattooed union thugs smashing the economy. In fact the occasional eruptions of ritual violence in the building industry tell us more about the corrupt building industry than unionism or the economy as a whole. Martin knows that unionism is a shadow of its former self, but cynically inflates the rubber bogeyman.

    The Grocon dispute is neither a cause nor a consequence of Australia’s past economic malaise, and is irrelevant to the next crisis of local capitalism.

    Look at Martin’s nightmare: “a perfect storm will blight the economy — tumbling commodity prices, ravaged public finances, increased labour costs putting an extra brake on infrastructure projects, and industrial anarchy”

    Nothing remotely original or new there. Except for the odd one out. Yup, “industrial anarchy”.
    Who needs Rottweiler Reith to scare the horses when you’ve got Peter Martin?

  • 4
    Ashar
    Posted Thursday, 30 August 2012 at 10:54 am | Permalink

    Can anyone tell me of a wealthy Australian that became wealthy completely independent of anyone else? They didn’t need workers to make their pretty shiny bundle of wealth and power, they didn’t need political help, they didn’t need inheritance, etc? I gather that is zero?

    Now tell me how many of those wealthy Australians shared equitably the wealth they received with the people that actually made it for them? It’s the same as movie companies complaining about piracy - when you pay all the townsfolk for the shoot locations, pay all the people who inspired the idea, and actually share the wealth with those who actually made it for you, then I’ll start to listen to you a bit more seriously.

    The building & construction corporations in Australia say they care about their workers, but if it weren’t for the CFMEU’s “hard-line”, more Australians would leave work at the end of the day in a body-bag. I don’t call that something I should suffer as the author of this article does, I call that something I want to support. Go the CFMEU!

  • 5
    fractious
    Posted Thursday, 30 August 2012 at 11:20 am | Permalink

    @ Frank, it’s Rob Burgess’ name on this, but otherwise I pretty much agree. There is absolutely no substance in this piece and while you kind of expect flaky, fatuous free-market dreck like this at Limited News or Failfax, it puzzles me why Crikey gives it house room. Slow day perhaps and thus a need for a bit of padding? Fine but why polish yet another “we’re rooned and we’re all going to die” turd and park it on the mantelpiece?

  • 6
    Frank Campbell
    Posted Thursday, 30 August 2012 at 11:26 am | Permalink

    stupid of me…Burgess it is. Apologies to P. Martin.

  • 7
    fractious
    Posted Thursday, 30 August 2012 at 11:28 am | Permalink

    When the state debts are factored in, we’re well above 20% of GDP

    ZOMG!! 23% according to IMF figures. We’re all on the way to hell in a handbasket. Meanwhile, the Chinese economy at 26% is obviously in dire straits, the US at 102% is in Purgatory and Japan at 230% is even now being swallowed up by the fires of Eternal Damnation.

    Disclosure: I am not An Economist, but then Rob Burgess isn’t a journalist.

  • 8
    gautillard dellron
    Posted Thursday, 30 August 2012 at 11:52 am | Permalink

    The Keating public debt that John Howard paid off by selling telstra leading to a private monopoly leading to some of the highest cost per performance communications network anywhere”

    fixed.

  • 9
    Suzanne Blake
    Posted Thursday, 30 August 2012 at 11:54 am | Permalink

    @ gautillard dellron

    There are much cheaper options now, Dodo, iinet, and lots of mobile cheaper options as well.

  • 10
    Mr Tank
    Posted Thursday, 30 August 2012 at 11:57 am | Permalink

    Crikey!

    Ashar, movie companies paying ” all the people who inspired the idea…” ha ha.
    otherwise mate loved it.
    Also loved Burgesses, “The CFMEU leadership won’t be worrying it’s pretty tattoo’d head over that kind of scenario — union leaders, if not the workers, prosper during times of mass unemployment.”
    Tattoo’d head’s no less!
    The same thing could be said about the Job Network Providers but that story is a pox on both sides of the house. Crikey!
    So our man says it’s Bill Shortens job to sort this street fight out?
    Yeah Bill get down there on the Picket Line and front some A**Hole’s riding horse’s down Main St. And while you’re at it ban those Ugly yellow and orange Shirts, Safety Gear? Nah they’re Gang Patches! You should be able to walk both sides of the street then.

  • 11
    SBH
    Posted Thursday, 30 August 2012 at 1:00 pm | Permalink

    Rob, rather than focus on how much Grocon says it’s losing here, can you have a look at what component of a major construction project’s final costs are litigation? In the early ’90s the Victorian Government estimated that this was the single highest cost and averaged about 45% of a major CBD project. Makes the IR costs pale doesn’t it?

  • 12
    Niall Hickey
    Posted Thursday, 30 August 2012 at 1:04 pm | Permalink

    I work in IR for a major construction company.

    Frankly, this article adds nothing to the debate, heightens fear, is idealogically rather than solution orientated, is premptive, assumptive and divisive.

    The onus is not on Bill Shorten to do anything other than to let the provisions set out in the Fair Work Act take their course. Following the outcome of this process, so-called journalists like Rob Burgess are free to pass comment on what they think of the outcomes. It would be unfair to pass comment (or, for that matter, set self-serving expectations) on the performance of the Act, or by extension, Labor IR policy until then. Hopefully he will speak to someone in the industry who actually deals with these people in formulating his response, although given this piece, I doubt he will.

    Referring to the Patrick’s dispute as the ‘golden age’ of industrial disputes highlights Burgess’ naivety on the subject, and given the adoration that Burgess evidently possesses for the Patrick’s dispute, this perhaps explains his demand for direct government intervention in a dispute. Surely Burgess, champion of free-market thought, is not advocating government intervention in a private dispute? Oh wait, he is.

  • 13
    geomac62
    Posted Thursday, 30 August 2012 at 1:29 pm | Permalink

    The Keating public debt that John Howard heroically paid off during mining-boom mark-one, was smaller than the 10% of GDP our federal government now owes.
    This sounds like it belongs to a boys own annual from the 50s . Howard didn,t pay off anything . The government he led flogged off 240 billion in assets to pay an alleged 90 billion which means he squandered 150 billion , the remainder . Howard for those who remember the debt truck , campaigned on foreign debt . Gaining office that campaign was dropped like a hot potato and foreign debt tripled under his less than heroic leadership . The man of spiel couldn,t control his team and lost a dozen colleagues due to failure to adhere to standard rules of behaviour for MPs . Foreign debt is what we owe the world and domestic debt is our house keeping . Everyone who has debt on their house or car knows that to provide the necessary you have to borrow . A rubbish article that follows the other articles the Spectator has had reproduced in Crikey . Its almost a parody without humour , a send up .

  • 14
    Tyler T
    Posted Thursday, 30 August 2012 at 3:10 pm | Permalink

    why is this fact free sludge posted on crikey
    i subscribe to crikey to avoid this sort of lunacy

  • 15
    Sancho
    Posted Thursday, 30 August 2012 at 3:20 pm | Permalink

    Just as an on-the-ground note, Grocon has been screaming blue murder about the traffic disruption foisted upon hardworking Victorians by union thugs, but no one’s mentioned what a nightmare of road closures and hazards Grocon has created in the streets around its Myer project in Melbourne.

    In addition to far more frequent, longer-lasting road closures than the CFMEU’s staged, Grocon has made room for construction by diverting traffic into a tight cluster of road markings apparently thought up by Jackson Pollock, and created a couple of lethal blind spots for turning traffic.

    If anyone’s passing through Melbourne, have a crack at turning into the Myer carpark from the north side of Lonsdale and see how safe you feel.

    And, oh yes: a dozen small businesses have been turfed out of an adjacent arcade because they don’t meet Myers’ standards of presentation. I’d love to hear from some business-friendly conservatives about the ethics of that.

  • 16
    Owen Gary
    Posted Thursday, 30 August 2012 at 3:35 pm | Permalink

    Why are we getting ever increasing Rightardt articles via extra helpings of poop, I hope that Crikey is not chasing that type of aroma?

  • 17
    Sancho
    Posted Thursday, 30 August 2012 at 4:33 pm | Permalink

    It’s not bad that Crikey features right-leaning articles. In fact it should be encouraged, because it’s bad for the site and for the discussion if Crikey is just a left-wing echo chamber.

    The problem is that instead of publishing thoughtful and reasonable conservative writers, the eds go for the media standard of hamfisted attempts at balance by allowing bland spivs from the corporate PR world to mix their advertising and scare campaigns in with the decent reportage, giving it a legitimacy it doesn’t deserve.

  • 18
    Suzanne Blake
    Posted Thursday, 30 August 2012 at 4:42 pm | Permalink

    @ sancho

    Crikey is just a left-wing echo chamber”

  • 19
    jj mick
    Posted Thursday, 30 August 2012 at 4:56 pm | Permalink

    Balanced reporting required that BOTH SIDES of an argument is presented. You have correctly put the employer’s side but remember that employers who are screaming cost control are at the same time shovelling obscene amounts of money into their own bank accounts with their salaries and bonuses are growing at alarming rates. And when the other end of the workforce wants a fair go this is the sort of campaign you get with all the whining and doomsday calls.

    When the big end of town stops taking huge amounts of money out of the pot I’ll support their calls for moderation. Unfortunately workers have been screwed for too many years and a bit of accountability needs to come back into the debate.

  • 20
    Frank Campbell
    Posted Thursday, 30 August 2012 at 5:13 pm | Permalink

    You really are the alter ego of the climate zealots/ALP lackeys, Suzanne…and, like them, you harm your own cause.

    Sancho is correct- Crikey needs the intelligent Right represented (as opposed to the Burgess froth here). We all need our opponents.

    And as I said in my post above, Crikey is not a “left-wing echo chamber”- it’s actually a fractured, ideologically incoherent, reactive, understaffed site. The handful of writers have to churn out stuff every day- no wonder the quality is so variable. There’s little time for reflection or depth. Crikey is a treadmill.

    Sancho refers to editorial “balance”, but there’s not much evidence of that. Zero balance on some matters, such as climate. Rather than “balance”, Crikey seems more like a few adjoining fiefdoms, such as the Kohler Korporates (including Mayne, lover of Gunns), the climate headbangers (Chapman, Rose et al) , Labourish policy-wonks like Keane, and the Aspergerish poll-dissectors.

  • 21
    Owen Gary
    Posted Thursday, 30 August 2012 at 5:28 pm | Permalink

    Actually I disagree, the full frontal rightardt froth you are talking about Frank is thrown at us from dawn till dusk on just about every media device you can think of.

    It is only the extreme right that thinks normal logical evaluation & approach is left wing thinking these days. Most of the articles not all are well ballanced & logical, yet they are ridiculed as leftist ideals, so it is there that I rest my case.

  • 22
    Gocomsys
    Posted Thursday, 30 August 2012 at 5:42 pm | Permalink

    This is after all an article written by Rob Burgess. Enough said.
    Poster comments like this fit the bill:

    If the workers at the site don’t want to be part of a Union, why is that an issue?

    and

    There are much cheaper options now, Dodo, iinet, and lots of mobile cheaper options as well.

    also

    Crikey is just a left-wing echo chamber.

    Splendid contributions indeed.

    As TYLER T said:

    why is this fact free sludge posted on crikey. I subscribe to crikey to avoid this sort of lunacy.

    Good question! Time to go somewhere else perhaps?

  • 23
    zut alors
    Posted Thursday, 30 August 2012 at 7:29 pm | Permalink

    @ Ashar: ‘Can anyone tell me of a wealthy Australian that became wealthy completely independent of anyone else? They didn’t need workers to make their pretty shiny bundle of wealth and power, they didn’t need political help, they didn’t need inheritance, etc? I gather that is zero?’

    David Walsh (MONA, Tasmania)

  • 24
    Suzanne Blake
    Posted Thursday, 30 August 2012 at 7:38 pm | Permalink

    @ zut alors

    Yes

    The people who win big with lotteries, lotto’s powerball etc.

  • 25
    John Bennetts
    Posted Thursday, 30 August 2012 at 8:26 pm | Permalink

    Gee, SB, that’s a considered and rational answer, especially coming from an accountant of sorts.

    Real accountants and sentient beings of other stripes might not stoop to recommending lotteries as a path to fortune, but there you go.

    Then again, shallow cr_p from you is not unusual.

  • 26
    margaret moir
    Posted Friday, 31 August 2012 at 3:36 am | Permalink

    More anti union & Mr Abbott Speak total doom and gloom. The Unions and members have proved their loyalty and commitment to our country I do wonder if big business can say the same with downsizing sending increasingly more jobs off shore leaving the govenment with the bill for the unemployed. Who was it and what media supported the idea that convinced the community the governments shouldn’t own income generating assets purchased with our own taxpayers dollars. The profits to benefit the whole community. If the government still owned Telstra, had our own state banks (run pre deregulation of banks) we owned our own power and water all the essential services. If we had to pay more at least the taxpayer on the roundabout would have benefitted. How about exploring who really has benefitted from globalisation and the deregulation of our banks our markets. Maybe it would be enlightening to all to have a exhaustive look in simple positive vs negative explanation. Now that would make a story tired of Mr Howard being portrayed as the be all and end all. WE should be supporting a govenment that is trying to address important long standing ignored issues left in the too hard basket. Big tobacco and the damage to health being addressed, the need to have understanding if the teaching methods in our schools are effective (very important for our future) the fact that the river system was in serious distress but up river continued to draw water regardless of the impact down river. The fact that dental health is important and may save money in the long run. I am excited by the NBN that the govenment / the taxpayers will own it and it will pay for itself and hopefully enable business more opportunites to work outside the cities. The endless issues with health / hospitals very difficult but this unusual govenment has taken it on and is attempting to bring about resolutions when the Howard govenment on all of these issues important to ordinary people did little or nothing. Thank you for the opportunity to have my say we truely are a lucky country and hope it will with the determination of the ordinary people and a govenment that will look first to the interest of his own people as well as all who contribute our country will continue to be great. Forgive me if I have miss understood what you have written.

  • 27
    margaret moir
    Posted Friday, 31 August 2012 at 3:45 am | Permalink

    Suzanne Blake

    There may be cheaper options to Telstra you miss the point Telstra was once a taxpayer owned asset that meant profits would benefit the people. The wider the tax or income net for the govenment the small the taxes can be.

    There are those who want less tax, smaller government which will equal less services and those at the bottom the most vunerable will wear the cost. WE could have had less tax a constraint on prices if the govenment still owned the essential services assets we as taxpayer once had.

    You may be one of the lucky one like me but there are many who are the collateral damage for our globalisation madness or for other reasons have not had the advantages we may have.

    Sick of selfish self centres ideologies forgetting that it is the whole community that is important and should be considered.

  • 28
    Scott
    Posted Friday, 31 August 2012 at 9:42 am | Permalink

    @Geomac62

    Howard didn,t pay off anything . The government he led flogged off 240 billion in assets to pay an alleged 90 billion which means he squandered 150 billion , the remainder”

    You can’t apply real measures to the incomings and then not apply real measures to the outgoings. If you apply the CPI’s to the asset sales (using a base year of 1996), you do get around $240 billion incomings, true. However, if you apply the same CPI’s to the debt repayments each year, you get around $318 billion being paid out to retire debt.

    While there was a bit of waste going on in the Howard years, it’s not quite as bad as you make out.

  • 29
    Hamis Hill
    Posted Friday, 31 August 2012 at 10:29 am | Permalink

    A forensic accountant may be able to tell us whatt the GST haul was on the unsustainable $750 billion Howaerd-Costello feel good, “golden era” mortgage debt orgy? Nominally $75 billion?
    And Frank’s “Asbergerish poll dissecters” soothes the pain of banishment for many.

  • 30
    Scott
    Posted Friday, 31 August 2012 at 11:01 am | Permalink

    Didn’t the vast majority of the GST (if not all) go to the states, HH?
    Also wasn’t it the main reason the first home owners grant was created initially (in 2000)…to compensate for the GST applied to housing purchases?

  • 31
    geomac62
    Posted Friday, 31 August 2012 at 11:07 am | Permalink

    Scott
    ” While there was a bit of waste going on in the Howard years, it’s not quite as bad as you make out. “
    You may have noticed that I wrote alleged debt because the figure like a lot of things depends on who states it and when . It was first said to be 9 billion by Howard and as the years rolled on that figure became 90 billion . A bit like a chinese whisper really . Officially it was 9 billion but I can only assume the figure was manipulated to justify selling off assets rather than say it was their ideological position . Maybe it was the political tendency to exaggerate negatives or positives . As Howard and Costello were always saying what good economic managers they were , there is that component as well . Personally I don,t ask for references about standards from the people themselves but others who have had experience of the work . You get a better and more accurate response as many house buyers will tell you . Self praise is no recommendation .
    Yes the health subsidy that paid for gym fees and golf clubs was a waste . The first home buyers grant going to build million dollar homes was beyond comprehension . The first home buyers grant managed to raise the cost of houses and was brought in to stem the sharp fall in building activity caused by the introduction of the GST . A bit of waste ? Depends how good the memory is .

  • 32
    Scott
    Posted Friday, 31 August 2012 at 11:18 am | Permalink

    Well, according to this :-
    http://www.budget.gov.au/2011-12/content/myefo/html/13_appendix_d-01.htm
    , the net debt in 1996 was 96 billion in the red.
    I don’t think it is chinese whispers.

  • 33
    geomac62
    Posted Friday, 31 August 2012 at 12:40 pm | Permalink

    Well done Scott ! You have managed to post a link with the full address and it hasn,t taken hours or a day to appear because of auto moderation . So quick I haven,t as yet read the article , flabbergasted at seeing the link up so quick . Will get back to you , time permitting as menswear to buy , sale .

  • 34
    geomac62
    Posted Friday, 31 August 2012 at 12:56 pm | Permalink

    the net debt in 1996 was 96 billion in the red “. Sorry if I come across as pedantic but debt is always assumed as in the red so its a bit superfluous to add the red . Net debt was …… in the black , yellow etc . Good work in digging it up , have saved for perusal . cheers

  • 35
    geomac62
    Posted Friday, 31 August 2012 at 2:18 pm | Permalink

    In a speech to the Liberal federal council that was pitched to positives rather than negatives, the Opposition Leader said he had been part of a good government that inherited a $10 billion budget black hole and turned it into surpluses. Gratten article in the AGE .
    By the time of the 1996 Election, unemployment was high, but at a lower rate than at the previous 1993 Election, and interest rates were lower than they had been in 1990, but foreign debt had been growing.[3] The Keating Government was projecting a small budget surplus. Following the election, an $8 billion deficit was confirmed. Wikipedia
    The truth is that taxation as a proportion of the economy is lower now than it was under John Howard’s government. The tax to GDP ratio, 23.7 per cent when Labor came to office, is now 21.2 per cent.
    According to figures that came across my desk yesterday, had the ratio remained at the 2007-08 level that Labor inherited, tax receipts would have been $21.4 billion higher in 2012-13 than they are projected to be.
    Returning the Budget to surplus would not be an issue. The Government would not only be looking at a surplus of $22.9 billion next financial year, but would have been back in the black by more than $3 billion in 2010-11. Oakes sunherald
    After John Howard won he ”uncovered”, with suitable gasps of feigned surprise, the $8 billion ”Beazley black hole”, resulting in some serious cost-cutting in the 1996 budget and the ”charter of budget honesty”, which required the Treasury and Department of Finance to provide an independent report on the fiscal and economic outlook during an election campaign, and independent costing of the policies of the major parties. SMH article
    So do we have a 90 or a 8/9/10 figure ? The link has two figures as well for 95/96 one of -11 mil and another of 96 mil for general net debt while the former is general cash revenue and cash balance .
    Your assumption about the first home buyers grant is incorrect . It was introduced because of the massive fall in the building industry , a stimulus . Many homes were rushed through to beat the GST and conversely many were put off after its introduction for the same reason , GST . As with any handout to the private sector be it health , education or homes the price went up in ratio to the handout because it could . Health insurance like private education fees go up every year without fail over and above the CPI .

  • 36
    Suzanne Blake
    Posted Friday, 31 August 2012 at 2:21 pm | Permalink

    @ geomac62

    Chief Patron of the Left Echo Chamber.

  • 37
    John Bennetts
    Posted Friday, 31 August 2012 at 2:39 pm | Permalink

    SB, Please at least try to be helpful. It would help if you were to engage brain before putting mouth into gear. As an accountant, surely you understand the difference between an annual debt and an organisation’s net debt - in this case, the federal net debt.

    It’s clear that Geomac and Scott are not talking about the same thing.

    Scott has linked to the historical data showing the federal net debt from FY1971 to the present.

    Geomac has referred to the annual debt which Howard inherited in his first year in office, which in 1995-96 increased by $9B.

    So, both contributors’ figures are correct, although misinterpreted by at least one party.

    SB could have followed the link, but clearly has failed to bother. This would have taken a minutes’ effort, but it appears that, as usual, she has just charged in blindly, following her prejudice, in order to shout some nonsense about one contributor being an echo chamber. Pot… kettle… black?

  • 38
    Owen Gary
    Posted Friday, 31 August 2012 at 2:42 pm | Permalink

    Suze you dont really deserve a response!

  • 39
    geomac62
    Posted Friday, 31 August 2012 at 3:10 pm | Permalink

    SB
    cheerleader for Mirabella and Bernardi . Never answers questions but has all the answers , slogans actually . Never investigates by checking out what people say but uses cut and paste from sources like Menzies House . Of course I don,t believe any career in auditing , forensic or otherwise . It requires patience and deliberation not to mention a degree of integrity and SB has yet to display any of those qualities on Crikey .

  • 40
    Scott
    Posted Friday, 31 August 2012 at 3:40 pm | Permalink

    Your assumption about the first home buyers grant is incorrect “

    Not according to this
    http://www.firsthome.gov.au

    As for your other question, there is a difference between a deficit (or negative underlying cash balance which is a loss on the Income statement…your -11 billion) and debt (which is a liability on the Balance Sheet)

    They are related somewhat as deficits usually need to be financed by increased debt but they are not the same thing.

  • 41
    Charlese
    Posted Friday, 31 August 2012 at 9:22 pm | Permalink

    Very interesting article and comment thread.I just signed up and think it’s great.
    Total union membership is apparently 15% of the workforce, but isn’t that 15% a critical mass in the key industries: building, large manufacturing, teaching, etc. As we see with Grocon and the CFMEU, this particular union has huge power over its members and can influence decisions on huge projects. They have also managed to get their members large pay packets so they can afford the odd week off on the barricades. I don’t like to see violence in the streets, and once again the cops cop it, but is this about union or big business or both? Excuse my poor syntax!

  • 42
    John Bennetts
    Posted Saturday, 1 September 2012 at 9:18 am | Permalink

    Charlese,

    As a union member of 40+ years and a construction site manager of somewhat shorter duration, I feel qualified to answer your question, at least in part.

    There are two types of unions - those for employees, and those for employers. The former Industrial Relations Act defined them as such. These organisations are supposed to be the negotiating representatives of their members. Both engage in industrial action, both lobby politicians, both run advertising campaigns at election time.

    Grocon will have received and be receiving advice from many sources, including corporate and industrial lawyers. Ditto, the CFMEU. Grocon can pretend that they are suffering grievously due to the current turmoil. CFMEU has a history of promoting confrontations such as we are now seeing, partly as some kind of advertisement to their membership that they, the members, are relevant, and that militarism is a way to achieve their goals. I don’t agree with this, but consider it to be street theatre.

    The real and lasting wins and losses will, as always, take place in negotiations and courtrooms. The purpose of the theatre, on both sides, is to bring the other party to the table and to deny them the upper hand in negotiations.

    Back to my own union membership: I have never taken a day off on strike, my union is very low key and professional, it is a large union with wide coverage and plenty of members. You will never read about it in the press, because confrantation is not their style. They have provided me with advice which has assisted me in my private negotiations with two employers in my earlyier days. They also coordinate and advise, in conjunction with other unions, during corporation-wide enterprise bargaining. This is about as close to the ideal as you will find.

    There are certainly true twits on both sides of major disputes such as the current CFMEU/Grocon one. I share your concern for the role of the police, although what they are doing is what they enlisted for and trained for, so I don’t feel sorry for them.

    The bigger the project, the bigger the stakes. It’s no surprise that the largest infrastructure and mining projects in the land are often where things come to a head. The trick is for the true decision makers to get together and hammer out a deal. What the hot-heads from both sides do is ultimately irrelevant… as, for example, the current CEO of Qantas will soon be irrelevant, despite having pulled off the greatest and m ost disproportionate dummy spit of anybody in the Australian industrial arena for generations. It is, in the final washup, not the size of the dummy or the distance it travels, but the number on the accountant’s bottom line. This goes for employees’ unions as much as it does for employers and CEO’s.

    Frequently, it is the side that spits the dummy first and furthest that ends up getting the worst of the negotiations. Patience counts.

    As for only 15% of the population being union members… who, in their right mind, would contemplate joining the HSU today? I wonder what percentage of employers are active in THEIR union? Less than 15%? The figure is somewhat irrelevant. What matters most is how good the representatives are at devising strategy and around the negotiating table.

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