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Crikey says: Hockey should hold the line with SPC

Do Australians think the ABC is doing a bad job? We apply the Crikey fact-check. Plus Bernard Keane on why the government will cut Aunty’s budget. The regrets of a former Immigration Department officer. Kathy Jackson faces a longer time in court. Helen Razer on the death of the homosexual. And the Winter Olympics: does anyone even care?

While Coca-Cola Amatil isn’t a multinational company like General Motors, it does very nicely thank you from a wide range of business in Australia and the region, focused most notably on its Coca-Cola bottling franchise. Even after a profit fall in the first half of 2013, Coca-Cola Amatil earned over $200 million in half-year profits.

The company is also the owner of SPC Ardmona, which is seeking a substantial injection of government funding — $50 million in total — to continue and invest in its food processing operations in the Goulburn Valley.

In resisting yet another effort at blackmail by General Motors to retain its Holden operations here late last year, the government — or more accurately, Treasurer Joe Hockey — took a politically difficult but correct decision. It is high time the vestiges of the protectionist era in Australian economic policy were wound back, however much voters would prefer to continue to subsidise industries.

SPC Ardmona should be an easier case than Holden: there is no possible argument about the strategic importance of food processing — despite the inane talk from all sides of politics about the absurd, protectionist notion of “food security” — and the political fallout will be more limited.

That’s not to be glib about the difficulties that the 3000-odd people who stand to lose their jobs if SPC Ardmona closes, and their families, will face. Economic restructuring always comes with a human cost. It is a cost generations of Australians in manufacturing have had to pay, but it is also a cost that has yielded long-term benefits in a more flexible, productive and richer economy.

Hockey is again leading the charge on resisting calls for assistance. May he triumph against many of his colleagues in today’s cabinet meeting.

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  • 1
    drmick
    Posted Thursday, 30 January 2014 at 2:01 pm | Permalink

    This line should extend to the Private Health Industry. The 30% rebate is a joke and props up an inefficient, unproductive parasite that draws billions away from public health, not only in funding but the corporate knowledge of the Public Health System trained staff that are utlised by the “private” sector. Let them see who survives when they are taken off the public teet.

  • 2
    GF50
    Posted Thursday, 30 January 2014 at 7:33 pm | Permalink

    drmick Bravo! totally on the money! international companies profiteering on the Medicare teat a totally obscene scandal!

  • 3
    Geoffrey Bond
    Posted Thursday, 30 January 2014 at 8:24 pm | Permalink

    Is the editor some economic guru that he has some gifted insight to justify his anti subsidy rant? Let him first come up with an explanation as to why all advanced economies subsidise industry and agriculture to one extent or another or is it just they are all misguided. The one glaring example of a no subsidy economy mentality was Margret Thatcher’s Britian which caused an economic catastrophe. Time to abandon this Milton Friedman crap

    For my part I am more interested in a fairer, more content society, a la the Scandinavian model, than a richer one. Intelligent selective subsidies can help.

  • 4
    Simon Mansfield
    Posted Thursday, 30 January 2014 at 9:45 pm | Permalink

    CCA was going to put in 160M as part of the restructuring deal. CCA like most of these middle ranking manufacturers was destroyed by the uncontrolled mining boom which suffocated the rest of the economy with high wages and a high dollar.

    This would appear to be vastly too complex stuff for the Fitzroy Collective’s Afternoon Herald to understand.

    Moreover, want no one really wants to admit is that food processing is actually high tech for Australia. These industry assistance schemes are largely focused on these types of business sectors who need in part to retool for a higher cost environment. CCA was looking a total investment back into SPCA of around 200 million in new plant and equipment. For Australia that’s a huge investment. Though I guess in comparison to the mining sector it’s a week spending on offshore rigs built largely offshore. Though those railway tracks to cart the iron ore at least get laid on Aussie soil.

    At this stage we are luckily that most of the food processing seems to be going to New Zealand which remains an assured quality product supplier with clean safe water used and the like inside factories maintains to first world food safety standards.

    I will buy some processed foods from elsewhere but I would never buy canned fruit from a Chinese factory.

    The ignorance displayed by the Crikey editorial team on the bread and butter of Australian manufacturing is quite incredible. But given the ignorance across governments and the wider public (going by today’s SMH and ABC discussion threads) is anyone surprised that Crikey parrots the same glib ideological rubbish in a pathetic attempt to sound intelligent on the issue.

    The issue is not about overall food security - but quality assurance within the critical food processing industries, and more importantly maintaining a mixed economy that has the critical mass to support a machine tools sector and the other allied areas of the manufacturing economy. We have little chance of developing high tech manufacturing if we can’t even operate medium tech mass production factories.

    The 50 million from the taxpayer could have been an equity investment. Imagine that - a government with actual skin in the game.

  • 5
    klewso
    Posted Thursday, 30 January 2014 at 9:58 pm | Permalink

    This after Abbott’s “Lies for Votes” before the election, when addressing this issue, in Stone’s electorate?

  • 6
    bobcats
    Posted Friday, 31 January 2014 at 12:53 pm | Permalink

    Bravo Mr Mansfield- I was thinking exactly the same way. Which would lead to suggest many other thinking Australians are equally outraged by this mean spirited, visionless ideology that masquerades as policy. Neoclassical economics is corporate snake oil that works for international economic entities at the expense of true capitalism and any fair and just society. Talk about Soveriegn Risk- Abbot and Hockey are it!

  • 7
    cmorreo
    Posted Friday, 31 January 2014 at 1:31 pm | Permalink

    SPC Ardmona should be an easier case than Holden: there is no possible argument about the strategic importance of food processing — despite the inane talk from all sides of politics about the absurd, protectionist notion of “food security” — and the political fallout will be more limited. That’s not to be glib about the difficulties that the 3000-odd people who stand to lose their jobs if SPC Ardmona closes, and their families, will face. Economic restructuring always comes with a human cost. It is a cost generations of Australians in manufacturing have had to pay, but it is also a cost that has yielded long-term benefits in a more flexible, productive and richer economy.”

    A Crikey editorial posing as an apology for neoliberal (political) economy, how very odd. And am also thoroughly unliking the food security diss.

  • 8
    AR
    Posted Friday, 31 January 2014 at 5:19 pm | Permalink

    The social effects of this & similar bigbiz beancounting serve as perfect examples of why the noxious nostrums of the NuRite neocon nutters should be judged by result.
    If major swathes of domestic industry is owned O/S, why the surprise that the common weal on those shafted should be irrelevant?

  • 9
    klewso
    Posted Saturday, 1 February 2014 at 9:18 am | Permalink

    Cheater - May 9 last year in front of a SPC community rally :-

    This (Labor) is a government on chaos which is completely disregarding you at a time when they should be standing side by side with you and doing whatever they can to support you”?

    Why didn’t he just add, “We won’t be any different, we will probably be worse, so don’t vote for our party either, if you value your jobs and homes and everything else you’ve worked for!” - except for his penchants for playing politics, his slavish desire to be so like Honest John (with his and his non-core promises), to see how many people he can gull, and for winning at any cost to anyone else? Was Tarzan (The Credlin) holding him back?

  • 10
    klewso
    Posted Saturday, 1 February 2014 at 9:20 am | Permalink

    sorry, he said “This is a government IN chaos….” of course.

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