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Turning government responsibility from service provider to one of social cohesion.

The entire premise of granting public monies via infrastructure grants or tax relief to big corporations is that THEY; the corporations and businesses are the “creators of work and jobs via a “trickle-down-effect” to benefit, eventually, the workers of the nation.

This is bullshit.

It has been a lie long promulgated and promoted by the vested interests who most benefit from this great big bag of govt’ monies, because if we break down the process of: Job – Business – employment, we can see that given the multitude of jobs that turn the wheels of industry are, will be, and have ever been those in existence since the dawning of humanity, ie: the necessity to satisfy the basic needs of survival; food, clothing, shelter, then ALL other industry is an extension from those necessities that multiply as the world population increases … transport, communications, health, agriculture etc.

So let’s draw an indelible line under that old furphy of “Business creates jobs”… finished!

Now let us look at how we can create a better model of social confidence in lasting employment and continuity of production. I will keep my theory to one subject as that will. I hope. Stop me from running off on a tangent that leads to confusion … and we can allow that one subject to set the example of how it could be extended to many other platforms.

The collapse of the car industry in South Australia … Holdens.

We all saw the harrowing exchange between those “free-market” ideologists; The LNP/IPA during the first heady weeks of their election victory where GMH (Holdens) was dared to leave the state and curse them for seeking “industrial welfare” in a free-market political environment …

Holdens called the LNP bluff and are leaving the State and leaving tens of thousands unemployed, multiple allied small businesses in the wilderness, with whole suburbs now on the brink of unsustainability … well done, LNP you! … for just a measly $50 mill’… it could have been averted. Here’s what I suggest …

With such vital industries as auto/machinery manufacture, and the multi-various small business and steel production that feed this “machine”, the Govt’ takes control of administration, finance and unit number production. This would leave the actual physical component of production-line manufacturing and assembly to be sub-contracted out to a manufacturer…BUT ONLY THE FUNCTIONAL PROCESS OF PRODUCTION OF THE PRODUCT … the admin, finance and post production sales would be kept firmly in the arms of government.

This would allow the small businesses allied with the industry to continue to quote for and maintain a certainty of production … it would allow the main manufacturer of the production-line (say; GMH) to concentrate on the production of the units and would give job security to the employees as they would be backed by the Govt’. There would not be a profit motive in the overall industry, as the Govt’ could run it on a break-even principle, thus allowing a lower price per unit on the sales floor.

Such a new form of public/private contract would see the main resource for ownership and security and managerial administration shift from private enterprise to social capital. National interests and job security would be maintained by government securitry of the financing of these enterprises. This would keep the administrative component in the public eye and under public observation allowing for a transparency of cost/expenditure.

Of course, there will be outrage at this proposal as it reeks of socialism … well, I would counter, what the hell do we have now? Private industry seeking govt’ bailouts, private industry seeking tax breaks or not paying tax at all, private industry seeking govt’ grants for research, development, and infrastructure without any govt’ interference in the management of those financial inputs … if that isn’t “industrial socialism” then nothing else is either!

The cry will be: “Govt’s are not profitable”… so what … if there is job security maintained, then the employees will feel more confident to spend and use credit to expand other industry and so more employment and tax will be gained.

“Govt’s are too slow on the pick-up in new technology!”… Give us ALL a break! … after the interference and total f*ck-up of the NBN by private vested interests like Murdoch and main Hi-Tech players like Telstra, there is NO argument for that bullshit, coupled with the above abandonment of a budding production capability of self-drive cars and electric cars just waiting for mass-production to commence AND the inevitable expansion of renewable energy, we can see the short-sightedness of those “innovators of industry”: Big Business/the LNP/the IPA.

“Govt’ enterprises lose money hand over fist”. If this were the case, I have to ask (and I HAVE!): Why are there then so many private corporations queuing up to purchase public utilities and infrastructure? Well, we ALL know the answer to THAT question … because all the hard yards and the solid groundwork has been done and all is left for the “mates of the LNP” that buy them to do is to “gold-plate” the infrastructure, jack up the profit margin and thereby screw the public and the Govt’ for as much as they can. The rest is all bullshit!

If such a new idea for governance could be developed across a wide range of industries, it would leave the individual/small-business person and subbie to quote for a cut into the pie and allow their feel for independence to be maintained. Large scale industries could be managed and maintained with the reassuring guarantee of Govt’ backing as long as there was no sabotage by recalcitrant “free-marketeers” as we have seen in so many govt’ run utilities in the past … many of which end up after a few years in private industry hands having to be bailed out at great cost to the public purse. Why not keep it in the public domain from the start?

So I say; cut out the middle-management man and secure those industries and utilities most needed for the national interest and place the security of job certainty once again where it belongs: in the public interest.

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  1. townsvilleblog

    Beautifully written and spot on subject, congratulation freefall.

  2. townsvilleblog

    We would be much better off as a population if the government employed the workforce without the middle man (foreign corporations) because those workers would all pay PAYE/PAYG income tax, which the foreign corporations evade and if the corporations pay anything, it is not over 5%.

  3. Andreas Bimba

    There is no reason a state owned enterprise cannot be as productive and innovative as the best privately owned business. The quality of the management team and the freedom to act in the best interests of the enterprise without excessive interference is what is most important. The various state electricity commissions are an example where reliable and low cost electricity was provided by state owned enterprises and much more cost effectively than the price gouging privately owned mess we have now. A more stable and rewarding work environment was provided for employees as well. State owned enterprises also have the advantage of access to lower cost financing and can pay a dividend to government.

    Our Conservative neo-liberal governments however have a pathological hatred of manufacturing which is shown by their eagerness to implement free trade agreements with low labour cost developing nations and are no doubt driven by their paymasters in the finance, mining, bulk agriculture and real estate speculation sectors in the main. Such governments also despise state owned enterprises and will always find a way to ‘throw a spanner in the works’ if the electorate remain ignorant enough to vote them into office.

    I think a 15% tariff on imported vehicles would be enough to retain a vehicle manufacturing industry in Australia but our neo-liberal duopoly currently won’t allow this. An equivalent subsidy is also unlikely to be supported.

    State or private ownership is probably not that important but Australian ownership would be preferable to foreign ownership so that foreign headquarters could not block exports from Australia which has happened in the past. For example Ford and GM at times refused to allow Australian manufactured vehicle exports into the US market.

    A regulatory environment including a price on carbon must also be established to drive the transition to electric and renewable liquid and gaseous fuel powered vehicles. Ideally at least 50% of the Australian market for these vehicles should be manufactured locally but the current neo-liberal mindset of the duopoly makes this currently unlikely.

  4. freefall852

    Andreas…you have put your finger on the pulse of all that is detrimental to job, taxation and manufacturing security for our nation…Yes we could extrapolate on the variables, but the central problem is the ideological attitude of the haves toward those who need just an equal share. Those ideological values and the people who push them will one day have to be confronted…but it will most probably be after climate change has “changed the landscape” somewhat !

  5. Harquebus

    I would have turned the GMH Elizabeth plant into a manufacturing, design, apprenticeship and business training center. Perhaps amalgamating other similar institutions into the premise as well.
    Producing only enough vehicles to satisfy the market would offset the cost of education. It is the knowledge lost that will be hard to replace.
    The GMH Elizabeth plant is only 15min walking distance from my home. Its closure will almost certainly affect myself and my neighbors, some more than others.

  6. havanaliedown

    Introducing… the Holden Trabant!

  7. freefall852

    havanaliedown..I had a “off-bet” with my mate running as to how long some “wit” would introduce THAT item….he won..I thought it would / could be forgotten…of course, being a local, I would have bet on the “Lightburn Zeta” but hey..I can see you are a bit more of the “internationalist ” than myself….Say…How’s the Edsel driving these days, or have you traded it in on a vintage P76 or that Nissan Cedric you had your eye on?…

  8. havanaliedown

    Naah – Mazda 3… the car that killed Holden.

  9. freefall852

    havanaliedown…Well there you go..happy “driving”…just watch out for those brutal Tonka Toys also in the sand-pit.

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