New manufacturing lobby divides & conquers self

Oh dear. As regular readers will know, I’ve been calling for a new manufacturing lobby for a year or so. Even though I hate such creatures with a vengeance, I fear even more the decision by Canberran economic mandarins to throw manufacturing to the wolves in the adjustment to Quarry Australia.

But the launch campaign by “Manufacturing Australia” today is beyond disappointing. It’s a shocker.  From The Oz:

A former Reserve Bank board member has been branded a “mouthpiece for Tony Abbott” after launching a last-ditch campaign against the government’s carbon tax.

Dick Warburton came under fire from union leaders as he called for this week’s vote on the carbon tax to be delayed until there is greater global consensus on climate action.

Mr Warburton, the executive director of the new lobby group Manufacturing Australia including companies such as Amcor, BlueScope Steel, Boral and CSR, said moving before the rest of the world would put jobs at risk.

“It seems quite wrong to be going ahead with this when the rest of the world are actually pulling out of carbon taxes and (emissions trading schemes),” Mr Warburton told ABC Radio.

“As long as there is going to be a tax of this nature on manufacturing, which is not comparable to any other countries in which manufacturing is carried out, that has to be a disadvantage

“It is a disadvantage that gradually would lead to probable loss of jobs and plant closures.”

But Australian Manufacturing Workers’ Union secretary Dave Oliver said manufacturing should be catching the new wave of climate change jobs rather than holding back the tide.

“It’s really disheartening to hear this group coming out this morning with this highly political agenda which doesn’t match up with the real issues in the industry,” he said.

“The fact that Dick Warburton refused to even support the steel industry plan shows that he’s just a mouthpiece for Tony Abbott.”

Australian Workers’ Union secretary Paul Howes said Mr Warburton should focus on issues affecting the manufacturing sector rather than “trying to score political points”.

“I don’t try and kid myself that I’m non-partisan and Dick Warburton shouldn’t either,” Mr Howes told The Australian Online.

“I don’t think his views reflect all the views of all members of Manufacturing Australia.

“Many of the members, the big ones like the steel industry, have welcomed the carbon tax package as it stands.”

Mr Warburton, who served on the RBA board from 1992-2002, denied he was playing politics.

He said his opposition to the carbon tax, which is to be voted on in the House of Representatives on Wednesday, was well known.

“Anyone who knows my background knows that I have been non-partisan but in the fact of the carbon tax my position is well known and clear and therefore I have no problem in assisting any group to lobby against the carbon tax,” he said.

I’ve perused the lobby’s new website and found not much more than a shop front. There’s no secretariat or any permanent staff (perhaps they’ll come in time), just a couple of links to PR firms. Worse, amongst the paltry literature at the site, there is not one mention of the Australian dollar. The IMF just declared the currency 20% overvalued but so what, eh?

Instead , there’s a singular focus on derailing the carbon tax, despite the fact that it represents a tiny impost versus the combined affects of Dutch disease.

This is not a manufacturing lobby for Australia. It is a lobby for a select few manufacturers that can think of no better way to do business than to hold back reform.

And the upshot is, we now have an even more divided manufacturing sector. Be careful what you wish for.

Houses and Holes


  1. But Australian Manufacturing Workers’ Union secretary Dave Oliver said manufacturing should be catching the new wave of climate change jobs rather than holding back the tide.
    Climate change jobs..WTF is that!

    • Ah, that would be manufacturing jobs making giant mirrors that we will need to erect to reflect sun rays!

    • These union leaders are selling out their members big time.

      The employer and employees should form their own union against the government and supposed union bosses

    • No shit. What do we expect to do? Out-compete the Chinese on solar panel production? How’s that working out?

  2. Hmm imagine if:

    1)Governments regulated bank lending to stop speculation in the property market.

    2)Interest rates are lowered pulling pressure off existing mortgages. (sorry to the people saving)

    3)With the lowering of the Australian dollar, manufacturing can be taken off life support and placed into remission where it can build itself up.

    4)Dump the carbon tax and accept that reducing Australia’s emissions are insignificant without a world effort in reducing carbon.

    5)Offer incentives,funding & education to develop green technologies to be exported to the rest of the world. (Build those ‘microsoft’ companies, that the labor dreams of creating, less the carbon tax)

    6)Put a new variation of a mining tax on minerals. Tax a certain percentage of extraction. Example: (For every tone of ore, Australia keeps 5% which can be either sold onto the market or stored for future generations) This percentage can then be reduced by the miner if they hire Australians or some way give back Australia in the form of investment programs for green technology.

    Just a few idea’s to help fix Australia.

  3. I say raise interest rates and screw the borrowers.

    Dump all new taxes.

    Cut income tax.

    Close down welfare.

  4. “a lobby for a select few manufacturers that can think of no better way to do business than to hold back reform.”

    Gee, you wouldn’t have an axe to grind by any chance, H&H? If your idea of reform is the carbon tax, you need to get out more.

    As for the carbon tax being a tiny impost cf the rampant dollar, that is (relatively) true but irrelevant; the rising dollar is a consequence of a whole raft of things, very few of which are government decisions. The carbon tax is solely a government decision. Besides, ever heard of the straw that breaks the camel’s back?

    Complaints about the high dollar would have more traction if they came with a credible suggestion as to how we could get the exchange rate down to (say) 70-80 cents US without shooting ourselves in the foot.

    • Both political parties are going to address climate change. That’s not up for debate.

      The Coalition will do so through regulation, costing business far more than it would through a carbon price. If you believe in the efficiency of private business, then you can only agree.

      So, Maufacturing Australia is pursuing a short term agenda that will cost manufacturing and everyone else more in the medium term whilst ignoring the major source of its competitive issues.

      There are many ways to lower the dollar as I’ve argued many times. They just take the will to do them. That starts with a lobby that decides its gonna push the change.

      • That is a good point only if you think the Coalition are good for their promise. I have my doubts!

        As for a carbon tax being more efficient, this is true in theory. However, in practice, as we have already seen in Europe, it is wide open to wholescale rorting. The price may be lower, but the effectiveness may be lacking. At least with direct action there is a reasonable chance we get what we pay for – an actual reduction in carbon emissions approximately equal to the promised five per cent. With a carbon tax which allows credits to be purchased overseas, there are few guarantees.

          • I doubt the Coalition are going to implement anything to address ‘Climate Change’ or ‘Global Warming’ or ‘Cooling’ or whatever it is anyway.

            At least with the Coalition policy it can be unwound if implemented.

          • “we can’t plan on the basis that they are lying can we?”

            Ha! I thought that was the first assumption made about any politician.

        • Is there a political party which has enough sense to understand Australia can’t do jack S*@! about climate change? Why not work on preventative measures of climate change such as building more desalination plants or build sea walls to reduce water levels.

          Its this mentality that if Australia cuts emissions by 5%-10% we will save the world. Its time to be realistic. The coalition only took a climate change stance because they would be labelled “deniers” if they didn’t have a plan to tackle climate change.

          • Australians produce most greenhouse gas PER CAPITA in the world. Each of us are causing MORE climate change than each individual American, Eurropean, or Chinaman. There is EVERY reason we should act first.

            You and Tony Abbott just like to say “there are not many of us so it’s not our problem”, but each individual Chinese provence could say the same thing. Chongquing provence could rightly say they have more people than Australia and produce less emissions, and they’d be right and it’s pretty hard to argue against.

          • The point about reducing emissions is to participate in a broader movement to reduce them, obviously.

            Don’t kid yourself fellas, as the symptoms o warming grow, the panic will rise everywhere. The Coalition will have no choice…

          • Complete red herring, Tom. The main reason we produce high emissions per capita is that we produce large amounts of stuff like aluminium that is used by the rest of the world. Also food – we produce enough for 80 million people.

          • H&H, I think you mean “IF” the symptoms of warming grow. Unless you have a reliable crystal ball, that is. Perhaps you could tell us the winner of this year’s Melbourne Cup?

          • Responding to Alex, I bet they make more CO2 making steel in Chongquing than we make when making aluminium. I also bet not many Chongquing townsfolk keep their 35 square McMansions air-conditioned all day so that they have a cool house to come home to.

          • Tom, I don’t live in a 35sq McMansion, nor does the average Aussie. The only cooling I have is evaporative – uses about 150 watts to power the fan. I don’t doubt that we have a higher usage of energy for domestic purposes than residents of Chongquing, but I fail to see the relevance of these points. Do you think we should reduce our energy consumption to the same level as theirs? I assume you might think that your own energy consumption is a fair level – otherwise with your strong views I’m sure you would have taken steps to reduce it. So what is a “fair” level?

          • Responding to Alex.

            First, what is the point comparing our way of life to the residents of Chongquing.

            The point refers to the Alan Jones argument “We only make 1.5% of world emissions so if we cut them by 10% this is 0.15% which is the same as zero.” The point is that this argument is wrong and invalid because we are individually the worst atmospheric polluters in the world, so we most responsible for this mess. Comparing us to America or China because they have 15 or 60 times as many people than us is fudging the numbers and is wrong.

            Answering the question “what is a fair level of energy consumption?”, I think the answer is “as much as we like, as long as we pay for it”.

            I thing a reasonable end goal is to power as much as possible on electricity (particularly transport), and to generate all electricity using photovoltaics or solar steam, geothermal, and maybe wind, possibly using reversible hydroelectrics to help spread the load. Zero coal, zero gas.

            To reach this point we need a price incentive, hence the necessity of a carbon tax.

          • @ Tom.

            The atmosphere doesn’t recognise who pollutes what. If carbon emissions were bound to country borders then it would matter. But it doesn’t. China’s growth rate in green house emissions surpasses all of Australia’s green house emissions. Its futile to even try.

          • Look at the global environment that the CO2 trading scheme has to opperate in.

            1. Not all parties are comitted.
            2. Difficult to measure.
            3. Economic incentive to defraud.
            4. Long time scale.
            5. Large costs to do effective actions.
            6. Selectively cataloging means significant metrics are ignored.

            Now compare it to other world problems of a similar nature.

            A. Deforestation
            B. Fish stocks
            C. Disposal of toxic waste.

            I read each reply supporting the trading scheme and then I substitute one of the above A,B,C’s for CO2. I am always hoping to then slap hand to forehead and go “Wow, that approach would have stopped Japan understating their tuna catch by 10 billion dollars!” “Yep, that system is an economicaly sustainable way for Brussels to pay to stop Brazilian rain forrest becoming soya fields”.
            “Now the cost of tracking and disposing of industro tech waste is affordably amotised back into the purchase price,”

            So far, no cigar. All I see is the potential for heroic failure.

            But if anyone genuinely believes that the scheme will deliver it’s stated objective, then please, modify it and roll it out to the A, B, C’s.

  5. There are parallels between the debt-boom of the last 30 years and the CO2 boom.

    We have borrowed way, way above our carrying capacity and now have to shrink our borrowing, restrict consumption and bring our debts back in line with system constraints. If we don’t, self-evidently the system will break down and cease to perform the functions on which we have come to rely.

    It is similar with CO2. We have overloaded the physical system and, quite obviously, it’s performance is gyrating away from its long-term stable mean range. Unless we dampen the CO2 load on the atmosphere/biosphere, it too will cease to perform the functions on which we have come to rely.

    This is so obvious that it barely needs to be stated; and yet, in the same way as we have been unable to resolve ways to manage our financial system, we have been unable to resolve ways to manage our interaction with our life-support system – the environment in all its dimensions.

    I hear once-upon-a-time “leaders” like Dick Warburton declare “the science of climate change is unsettled” and know that it is people such him that have brought us to the current pass, in econo-financial terms as well as bio-environmental terms.

    When will we develop the capacity to use our insight! We are all growing old listening to this kind of nonsense.

  6. I aint no zealot wrt climate but I really do want a carbon price. Make it a biggun.
    Reason 2? Clean power tech. originating from this island will help us once the quarry men party is over.

    (I can grudgingly accept Metallurgical coal.)
    Yes, I have to pay more for electricity.

  7. Jumping Jack Flash

    we need serious deflation to become globally competitive, or tax production in productive (polluting) developing countries. Carbon tax achieves both.

    if you haven’t noticed this carbon tax thing is a global phenomenon, we are not unique.

    a carbon tax is designed to be ineffective enough for big polluters to simply pay up to avoid hassle.

    the ultimate aim is to get Asia to take it on through global pressure, then they lose their competitive advantage, and the horror of globalisation and the race to the bottom is removed.

    then we can sit in our naturally cooled office pressing our (environmentally friendly) button for 6 figure salary while industrial China is taxed to oblivion, or, forced to buy expensive ‘green technology’ from advanced nations which has negligible effect on co2 production. this pays for everything.

    it is far too convenient. I am highly skeptical because it reeks of corruption and can-kicking at a global level. It favours the west and white collar service industry which is unproductive at best and does nothing substantial. At worst it is a leech on productive enterprise.

    They are also trying to artificially engineer the next ‘age’ after the information technology age. we need new products to sell, not just the same tired old stuff rebadged with clocks in it. enter the ethereal green technology that everyone is forced to buy. I suppose they want to call it the green age too.