Rudd funds 7000 deckchairs on Titanic

From the AFR:

A Rudd government would invest $36.5 million to train the manufacturing workforce for the future, the PM says.

The funding would be used to train 7000 new and exiting manufacturers, cushioning the industry and Australia’s economy from the end of the China mining boom.

Regular readers will know that I’m all for the manufacturing of the future, not mention today. And I guess subsidised training for manufacturers can do no harm.

But will it do any good? For manufacturing to rebound, it first needs to become competitive again. Only that way will we find demand for new jobs and it will take a bloody great macro-economic overhaul to do it:

• the dollar must be lowered
• the flow-on effects of inflation must be kept out of wages, ensuring a real depreciation
• other input costs will have to fall as well including land
• barriers to entry in other countries must be lowered
• research, development and export incentives must be juiced

Until we see these kinds of initiatives we’re just shifting the deck chairs on the Titanic.