Australian Economics

1eyedtiger

Tiger Superstar
Jun 2, 2007
1,132
0
Okay all,
I think we need a separate thread from all the political thread to concentrate on economics.
I've only got a basic knowledge of this subject and to be quite honest, know only about as much as the average Australian about economics.

I'll start off with the automotive industry. In a true capitalist economy (market driven with no regulation), as far as I'm concerned, the car manufacturers should have been allowed to go broke (I do feel for the workers as it's not their fault and they have to support themselves and their families), but market forces should surely have enabled more sustainable competitors into the market. In Australia, we throw millions their way and receive nothing in return except more threats of jobs losses unless we keep propping them up. My understanding is that in the US, they gave them money in the form of buying shares instead and in turn, positions on the company boards. As I understand it, the car companies hated this and ended up paying the US government back to get rid of government interference. Much more preferable than simply throwing money around.

Why can't we be smart?

I've said it before and I'll say it again, we're definitely the lucky country because we're seriously not smart.

Can anyone explain to me why the capital pigs of this country demand true capitalism without regulation but then are quite happy to resort to socialism to bail them out of the mess they create?

Feel free to bring up any other issues with Australian economics.
 

RemoteTiger

Woof!
Jul 29, 2004
4,577
0
Australia's economy needs an automotive industry - for its tenticles spread too deep into the manufacturing sector. Smart auto manufacturers (e.g. Toyota) are selling many many cars and engines overseas. Plus they are building cars that are wanted by the market - Holden and Ford seem, to me as an outsider, to be dinosaurs and sticking to the Commodore Family Style Car or the Ford Falcon Family Style Car - it took a couple of years to drag these two into the Diesel Motor versions of their products and that happened only when GMH got the Captiva from Korea and Ford appeared to begrudgingly include a diesel Territory in their stable.

I think the propping up through Government grants has made the management of GMH and Ford lazy. Further I think they appear to be slow on the uptake of Hybrid Vehicles and also electric vehicles - both of which will be big sellers over the next couple of decades (and possibly beyond).

With our big beautiful country and its geographical vastness you would think that the local automotive manufacturers could become the world leaders in four wheel drive vehicles - but no the Japs leave us for dead.

In France the automotive industry faulted and the French Governemnt stepped in and the two largest manusfacurers Citreon and Peugot are now part owned by the Government - their plants supply various parts for the different models in each brand and through economies of scale are surviving and forging ahead.

I am not advocating socialism - I just want to see our industry become smarter and open up larger markets world wide.

Why is it that when Senior Management ***** up - it is the workers who lose their jobs? Fair dinkum GMH should have been in the small to medium hybrid market and/or diesel market 10 years ago - but their management cannot foresee market trends and hence the company is left lamenting - sadly the worker pays with the loss of their jobs.

Governments have no option but to prop up this industry or it will leave a hole in our economy that cannot be filled for many many years. Or until such time as they buy shares in both GMH and Ford on behalf of Australian Taxpayers and then bring economies of scale into play plus invest more to move the focus to what the market is wanting. Then like the US Automotive industry allow the manufacturers to buy back the Governments Shareholding and create a market driven industry.

My beliefs - admittedly an outsiders - but we cannot just keep throwing money at these companies - but on the other hand we cannot afford to let them wither and eventually die on the vine.........
 

1eyedtiger

Tiger Superstar
Jun 2, 2007
1,132
0
I agree with you Remote.

As you said, the French government now owns part of the car manufacturers, not like here where we just throw money at them with no strings attached.

I can't see why the government has to prop up the automotive industry. If the privately owned car company can make a profit, there is no reason why a publicly owned car company run in the same manner cannot make a profit as well. Rather than propping up the automotive industry (and it angers me when highly paid executives get 'performance' based bonuses based partially on results propped up by the taxpayer), I say the government should embrace capitalist ideals and compete with them instead, with all the profits going back into public hands. Same with the supermarket chains, banks and any other essential industry.


BTW, I should clarify that this thread shouldn't become political. I want this thread to be one where issues are raised and what you'd do to solve them. Economics is not an exact science. It's heavily based on speculation.
 

billyb#40

Tiger Superstar
Sep 19, 2004
1,657
0
Car industry
Paying GM or any other foreign manufacturer is fraught with danger as they will be a tiny part of a foreign group with completely different goals to Australia. They will take money when they can get it, and leave when they choose.
Germany has an innovative higher cost based car manufacturers closer to the premium end where innovation and technology are used to make them competitive on a world scale. Wages can then be more to our levels?
It would be nice if we could have an Australian owned equivalent and then putting government funding into it would feel better.
Probably too hard given the NBN experience.
Could we do it,
would we want to fund it.

Is it still important to have an Australian auto industry so we can convert it to armament manufacture during the next world war. Or is the technology moving so fast that we couldn't do that during the likely duration of any war
I am not sure what the game plan is behind the drive to keep a vibrant? auto industry in Australia, apart from subsidizing a few inefficient jobs, and is that right or wrong anyway.
We pay public servants and sometimes get less from them than a P76 or cruizer or a charger. Actually maybe no.
 

Giardiasis

Tiger Legend
Apr 20, 2009
5,447
84
Brisbane
1eyedtiger said:
Can anyone explain to me why the capital pigs of this country demand true capitalism without regulation but then are quite happy to resort to socialism to bail them out of the mess they create?

Feel free to bring up any other issues with Australian economics.
If by capital pigs you mean big business, then you are incorrect in stating that they demand true capitalism without regulation. That would mean competition would be free to compete with them. Big business will grab any advantage they can from the government to stop competition. Costly regulations are good for big business as they are able to afford it, while the smaller players can not.

Any redistribution from profitable enterprise to unprofitable enterprise can only result in a drop in overall wealth. It benefits a small group of people that are politically relevant, but at the expense of everyone else. As the expense is spread out over a large body of people, the drop in wealth is not obvious to individuals. If you don't allow the market to provide the price signals entrepreneurs need to best allocate capital, then the ability to match production with what people want will be stifled.
 

1eyedtiger

Tiger Superstar
Jun 2, 2007
1,132
0
Giardiasis said:
If by capital pigs you mean big business, then you are incorrect in stating that they demand true capitalism without regulation. That would mean competition would be free to compete with them. Big business will grab any advantage they can from the government to stop competition. Costly regulations are good for big business as they are able to afford it, while the smaller players can not.

Any redistribution from profitable enterprise to unprofitable enterprise can only result in a drop in overall wealth. It benefits a small group of people that are politically relevant, but at the expense of everyone else. As the expense is spread out over a large body of people, the drop in wealth is not obvious to individuals. If you don't allow the market to provide the price signals entrepreneurs need to best allocate capital, then the ability to match production with what people want will be stifled.
So what you're saying is that big business want it both ways and use their influence to ensure that, in effect they are hypocrites.

All I'm saying is that there is no reason why publicly owned enterprises cannot compete with privately owned enterprises to ensure that the market place is kept at a level (and fair) playing field. Also solves the unemployment problem as those on Centrelink payments could be employed in the publicly owned enterprises, learning proper skills on the job. As I said before, there is no reason why we shouldn't have a publicly owned bank, supermarket chain, hardware store chain, oil company and essential utilities. The profits would be retained by the public instead of overseas shareholders. Selling the state banks and utilities was one of the dumbest things that has ever happened. If they were that inefficient, why not hire a private management company to run the facilities for a fixed fee (and maybe performance bonuses) and retain any profits in public hands?

I'm confused by the second part of your response since the gap between the rich and the poor is ever increasing. So why are we redistributing funds to unprofitable industries when it only benefits very few? So do you agree with propping up the automotive industry or not?
Reminds me of a saying:

'It's easier to take $1.00 off a million people than it is to take $1,000,000 off one person'

But is it right to do that considering that the one made his fortune from exploitation in the first place?

That's the basic definition of profit isn't it? To sell something for more than it's worth therefore someone or something is being exploited along the way.

From my point of view, that's the very corner stone of capitalism. Exploitation.
 

Rosy

Tiger Legend
Mar 27, 2003
54,347
4
1eyedtiger said:
That's the basic definition of profit isn't it? To sell something for more than it's worth therefore someone or something is being exploited along the way.

From my point of view, that's the very corner stone of capitalism. Exploitation.
Don't agree with that definition. Profit it to make financial gain. You don't have to sell something for more than it's worth or exploit anyone to achieve that.
 

Giardiasis

Tiger Legend
Apr 20, 2009
5,447
84
Brisbane
1eyedtiger said:
So what you're saying is that big business want it both ways and use their influence to ensure that, in effect they are hypocrites.

All I'm saying is that there is no reason why publicly owned enterprises cannot compete with privately owned enterprises to ensure that the market place is kept at a level (and fair) playing field. Also solves the unemployment problem as those on Centrelink payments could be employed in the publicly owned enterprises, learning proper skills on the job. As I said before, there is no reason why we shouldn't have a publicly owned bank, supermarket chain, hardware store chain, oil company and essential utilities. The profits would be retained by the public instead of overseas shareholders. Selling the state banks and utilities was one of the dumbest things that has ever happened. If they were that inefficient, why not hire a private management company to run the facilities for a fixed fee (and maybe performance bonuses) and retain any profits in public hands?

I'm confused by the second part of your response since the gap between the rich and the poor is ever increasing. So why are we redistributing funds to unprofitable industries when it only benefits very few? So do you agree with propping up the automotive industry or not?
Reminds me of a saying:

'It's easier to take $1.00 off a million people than it is to take $1,000,000 off one person'

But is it right to do that considering that the one made his fortune from exploitation in the first place?

That's the basic definition of profit isn't it? To sell something for more than it's worth therefore someone or something is being exploited along the way.

From my point of view, that's the very corner stone of capitalism. Exploitation.
Big business wants what's good for themselves.

Your idea of government enterprise competing with private industry is not going to deliver good outcomes for customers or for overall wealth. Public enterprise is not constrained by the profit motive like private entities are, as they are backed by the tax payer, and the printing press. So if they fail to deliver what customers want, they won't go out of business like a private company would, as they can continue to absorb losses. Assuming that these enterprises will actually make a profit would go against the long list of government run failures. Instead of enhancing competition, your idea would have the opposite effect, causing distortion of capital allocation, and putting private enterprise out of business.

In regards to the second part:
Government redistributes money to benefit so few, because those few they advantage deliver them political capital in return. Votes, campaign money, etc. The redistribution doesn't help poor people, it provides security to the industrial working class that already have jobs. Clearly I think this to be bad policy.

Your understanding of profit and economics is in error. Economics is not a zero sum game, I.e. rich people aren't rich because poor people are poor. If there was always a winner and a loser in trade then people wouldn't trade. Trade benefits both parties, as neither party would enter into the trade if they didn't derive a benefit from it. The only time a trade can be considered exploitation is if one party was forced to accept the terms of a trade under forcible coercion, such as slavery. In a free market, business can only achieve profit by meeting customer demands. They fail to meet demand, they will fail to achieve profit, and they will go out of business.

Capitalism is about the division of labour, and the coordination of resources via the price system, which provides the signals entrepreneurs need to correctly allocate capital to where it is most needed. It is not about rich fat cats exploiting poor people, which the left would have you believe. Australia does not operate under free market capitalism, it is more accurately a quasi capitalist model with significant socialist interference, the most perverse of which is our use of central banking. You're going to have to expand your reading to appreciate this.
 

bullus_hit

Whatchu talkin about Jack?
Apr 3, 2006
12,384
0
Capitalism is it's current form is broken, Blind Freddy can see that by looking at the European malaise, the American addiction to debt, the reckless speculation in the banking system and the inpenetrable barriers to entry created by big multi-nationals.

It's almost laughable that the apologists whinge a squeal about public welfare, but when it comes to trillion dollar bailouts for banks, subsidies for the automotive industry and generous cash concessions for the uber rich, there's a deathly silence.

Wake up all you economic fundamentalists, what we're witnessing is anything but free market economics, it's closer to a game of monopoly where small time players are being trodden on like little ants.
 

Liverpool

How did that Julia and Kevin thing work out? :)
Jan 24, 2005
9,054
0
Melbourne
An update on the economy...going up $5-billion a week it seems! :cutelaugh:

April 21st 2013
Federal Treasurer Wayne Swan has revealed the budget has taken a $7.5 billion hit since the end of October.
Mr Swan blamed the effects of the high Australian dollar for the revenue writedown.
Speaking to the ABC's Insiders program, he said Australia was in a unique situation where the terms of trade have come down, but the dollar has not moved.
Mr Swan said this has had a dramatic impact on company profitability and prices in the economy.
"That's caused a hit if you like, a sledgehammer to revenues in the budget since the mid-year update of something like $7.5 billion," he said.
http://www.abc.net.au/news/2013-04-21/swan-blames-high-aussie-dollar-for-revenue-write-down/4641826


April 29th 2013
"The bottom line for the budget bottom line is this: the amount of tax revenue the government has collected so far this financial year is already $7.5bn less than was forecast last October," the Prime Minister will say.
"Treasury now estimates that this reduction will increase to around $12bn by the end of the financial year.
http://www.theaustralian.com.au/national-affairs/treasury/bn-hit-to-budget-revenue-forecasts-as-julia-gillard-quarantines-reforms/story-fn59nsif-1226631199943


Today (May 7th 2013)
The Gillard government will not go ahead with a family benefits boost that would have provided a maximum of $600 extra a year to eligible Australian families, as it signals that the budget faces a $17 billion shortfall in revenue this financial year.
http://www.smh.com.au/business/federal-budget/federal-budget-takes-17-billion-hit-20130507-2j4ah.html#ixzz2SZwl1ZI8


Wonder what it will end up being?


Australian Financial Review states this:

The shortfall in forecast budget revenue will be between $60 billion and $80 billion from now to 2016, forcing the Gillard government to dump spending pledges, including $1.8 billion in family assistance.
Next week’s federal budget will reveal the total write-down in tax collections in the current financial year will amount to $17 billion, and rise to more than $20 billion in the next financial year. With senior ministers repeatedly conceding publicly in recent weeks that the fall-off in revenue is not expected to recover “any time soon” – and with the federal Treasury taking an ultra-conservative approach to its forecasts after recent bruising corrections – the likely write-down in revenues over the four budget years from 2013-14 is expected to run to between $60 billion and $80 billion

http://www.afr.com/p/national/budget_hole_could_reach_bn_YP7ipqnuNtDJQWOf5pTEgI
 

Giardiasis

Tiger Legend
Apr 20, 2009
5,447
84
Brisbane
bullus_hit said:
Capitalism is it's current form is broken, Blind Freddy can see that by looking at the European malaise, the American addiction to debt, the reckless speculation in the banking system and the inpenetrable barriers to entry created by big multi-nationals.

It's almost laughable that the apologists whinge a squeal about public welfare, but when it comes to trillion dollar bailouts for banks, subsidies for the automotive industry and generous cash concessions for the uber rich, there's a deathly silence.

Wake up all you economic fundamentalists, what we're witnessing is anything but free market economics, it's closer to a game of monopoly where small time players are being trodden on like little ants.
Robert L. Bradley has a good take on how our system works. He is describing the US system, which is similar to the Australian system.


Political capitalism is a private-property, market-oriented system that is compromised by business-sponsored government intervention. It is a socioeconomic system in which many or most regulations, subsidies, and tax-code provisions result from the lobbying efforts of directly affected businesses and their allies.

Today in the United States, there is greater political transparency and competition between political elites than was evident in the business-dominated past (the 19th and most of the 20th centuries). Interventions routinely result from non-business special interests representing education, the environment, labor, minorities, religion, retirees, science, and taxpayers, among others. Still, business interests—unified or in opposition—are arguably the most important of the elites that compete for special government favor in American politics today.

There are two avenues to business success under a private-property, profit-and-loss system. When using the economic means, or free-market means, businessmen provide goods or services in an open market and rely on voluntary consumer patronage. When using the political means, businessmen obtain a governmental restriction or favor that provides the margin of success beyond what consumer preference alone would give. Market entrepreneurship is the way of capitalism; political entrepreneurship, or rent-seeking as it is known in the economics literature, is the way of political capitalism.

Business interests welcome competition for the things they buy (to minimize costs) far more than for things they sell. They may profess support for free enterprise in general but not in their particular area. There, competition is disparaged as "unbridled," "cut-throat," "excessive," or "unfair," and calls are made to constrain the free market.

Historian Gabriel Kolko has defined political capitalism as "the utilization of political outlets to attain conditions of stability, predictability, and security—to attain rationalization—in the economy." Much of the intervention that he and other historians documented in U.S. history was for business, by business to "allow corporations to function in a predictable and secure environment permitting reasonable profits over the long run."

Mercantilism in Adam Smith's day was a prominent form of political capitalism. Under this doctrine, the wealth of nations was perceived to result from the inflow of monetary species (primarily gold) from international trade. Business and political elites worked together to restrict competition from imported products to reserve home markets for home products and to keep specie at home. Adam Smith and other free-trade proponents argued that the wealth of nations resulted from capital accumulation and a global division of labor, not protectionism.

For much of the 19th and 20th centuries, American business capitalism was political capitalism. (Non-business government intervention—the welfare state, public education, legislated morality, etc.—was more reformer- than business-driven.) Thus, major programs such as the Interstate Commerce Act of 1887, public utility regulation by the states and then the federal government, wartime planning during the world wars, and 1930s New Deal planning were driven more by the for-profit businesses than by any other constituency. Business participation in foreign-policy decision making coupled "domestic intervention (corporatism) with overseas intervention (empire)."

The following constraints on rivalry have characterized political capitalism, particularly from the mid-19th century until today:

Import restrictions. A tariff or quota on foreign goods that can raise prices and increase market share for domestic industry


Price supports. A price floor, as for an agricultural product, that allows a firm or firms to have greater and more predictable revenue


Grant protection. A government permit, franchise, or license to enter into a line of commerce that reduces the number of competitors in order to advantage the established firm(s). Under "natural monopoly" public utility regulation, franchise protection is accompanied by rate regulation (the so-called regulatory covenant).


Loan guarantees. Taxpayer-backed obligations that reduce or eliminate risky business investments such as those undertaken in a developing country.


Antitrust laws. The spectrum of laws against charging more, the same, or less than one's rivals—called "monopolistic," "collusive," or "predatory" pricing respectively—which result in many more private than government antitrust lawsuits.


Subsidies. Grants for research and development that are made in areas considered to be in the public interest, such as non-polluting energy technologies.


Quality standards. Minimum standards that advantage larger firms or firms at the high end of the quality range at the expense of lower-end competitors.


Tax favors. Special tax provisions that favor some companies or industries at the expense of other companies or industries.

These interventions alter the production of goods and services compared to what would exist from consumer demand alone.

Political capitalism is closer to capitalism than socialism because private property and profit-and-loss accounting are at work. Political capitalism is also different from the macroeconomic planning of the so-called mixed economy. Activist fiscal and monetary policy are broader than policies enacted on behalf of particular firms or industries, although the major institutions of intervention (the Federal Reserve Bank, for one) can be established and influenced by national business organizations such as the U.S. Chamber of Commerce.

Political capitalism is the unplanned, opportunistic result of transient interest-group coalitions and temporary political majorities. It is not the work of a central plan in part or whole, although elements of central planning can coexist and, indeed, inspire dispersed special-interest politicking.

"Follow the money" has led many historians studying political capitalism from effect to cause, from intention to result. In an economic system in which the use of the political means is accepted and common, the entrepreneur weighs whether the benefits of government lobbying are greater than the costs ex ante. If so, a firm or trade association is likely to pursue government favor. Such decisions to proceed often prevail over the interests of the less organized opposition because the benefits are concentrated in the involved firm(s) and the cost is spread out over all taxpayers and/or consumers, making the per capita burden negligible. But this disparity has closed over time as taxpayer, consumer, and other "common good" groups have been formed to lobby alongside other interests.

Political capitalism has aroused strong criticism and calls for reform. Marxists and socialists have sought to break the link between politics and capitalism through a government takeover of the economy. However, this radical coercion would make all life, not just business, political. The real problem is the "political" side of the political capitalism equation, where businesses turn into foes of capitalism, and private-public "government" causes distortions in the economy and a loss of public support for capitalism proper. Some defenders of political capitalism may view competing elites as democracy in action, but the ideal of a transparent, free society points toward a limited role for government and the need to minimize politics in business.

http://www.politicalcapitalism.org/what/
 

tigertime2

Our cup runneth over!
Mar 22, 2008
3,648
104
our population is very small - we lack vision - we lack the desire and the will to create projects that are truly Nation building ala the Snowy River scheme. There is no left wing right wing that is a political excuse to do little and not tackle the issues to grow the Nation together. Government (The People) and Enterprise can work together to create whatever we want - there are only self imposed limits we place upon ourselves as a Nation that stops us from achieving great things. Australia as a Nation has trillions and trillions of dollars of assets - we did not borrow one cent from overseas to build the Snow River Scheme - we have a lack of Vision and political will to create great things in this country.
 

bullus_hit

Whatchu talkin about Jack?
Apr 3, 2006
12,384
0
Giardiasis said:
Political capitalism has aroused strong criticism and calls for reform. Marxists and socialists have sought to break the link between politics and capitalism through a government takeover of the economy. However, this radical coercion would make all life, not just business, political. The real problem is the "political" side of the political capitalism equation, where businesses turn into foes of capitalism, and private-public "government" causes distortions in the economy and a loss of public support for capitalism proper. Some defenders of political capitalism may view competing elites as democracy in action, but the ideal of a transparent, free society points toward a limited role for government and the need to minimize politics in business.
Limited government intervention in the financial markets? I guess that only refers to regulation, but when it comes to corporate welfare, the skys the limit.

Unfettered capitalism has failed, greed and specualtion has reached epidemic proportions and it's the tax payer and the common man who have had to foot the bill. Notice how most European economies are collapsing under the weight of dodgy dealings by merchant bankers and traders? Human nature hasn't changed of course, it's just that the stakes are higher than they've ever been in recent history.

And those at the head of the rotten fish haven't changed one iota. As yet another timely reminder of the 'greed is good' mantra, 20% of the GFC bailout money went on executive bonuses, money well spent......not. Anyone who mistakes underwriting loans with propping up a crooked corporate culture is living in a fantasy world. Seeing as though the author of the above article cites Adam Smith, I'll just take the time to remind him that Smith would be aghast at the process of siphoning off the government coffers to prop up failed businesses. He was of course, an advocate of 'free markets', as opposed to installing an environment of monopolies and oligopolies, who by their very nature, held governments to ransom.

Capitalism in it's current form is the biggest Ponzi scheme known to man. Economic growth at all costs....... grow forever and prosper? Let's just rewind and just check that statement. Grow forever? Correct me if I'm wrong but in a world of finite resources, how can we possibly have a system which advocates growing indefinitely. Oh, that's right, let's breed some more so we have more eager little pac-men and women consuming until they can consume no more. Sheer brilliance, wouldn't you say so?
 

bullus_hit

Whatchu talkin about Jack?
Apr 3, 2006
12,384
0
mld said:
I think gia and yourself are in furious agreement over bailouts, bullus.
Glad to hear it.

I must say that the author of the above article seems like a deregulatory fundamentalist, he gives the game away with the Marxist nonsense in the final paragraph.

With regards to deregualtion and government intervention, I'm yet to see or hear a comprehensive argument which details why all government run enterprise is inefficient in comparison to the private sector. Such blanket statements are generally the work of lobby groups with vested interests.
 

Giardiasis

Tiger Legend
Apr 20, 2009
5,447
84
Brisbane
bullus_hit said:
Glad to hear it.

I must say that the author of the above article seems like a deregulatory fundamentalist, he gives the game away with the Marxist nonsense in the final paragraph.

With regards to deregualtion and government intervention, I'm yet to see or hear a comprehensive argument which details why all government run enterprise is inefficient in comparison to the private sector. Such blanket statements are generally the work of lobby groups with vested interests.
Pick up anything written by Ludwig von Mises, Fredrick Hayek, Murray Rothbard, or George Reisman. The Austrian school of economics has been at this for over a century.
 

bullus_hit

Whatchu talkin about Jack?
Apr 3, 2006
12,384
0
Giardiasis said:
Pick up anything written by Ludwig von Mises, Fredrick Hayek, Murray Rothbard, or George Reisman. The Austrian school of economics has been at this for over a century.
If we're talking superior economic performance of the 21st Century, China has whipped the sorry arse of every Western economy in the world. The Marxist whackos have edged their way to almost monopolistic dominance of manufacturing, and have now become the defacto lender to all those ailing economies drunk on spending.

Sorry Ludwig and co. but I think it's time to rewrite the history books.
 

mld

hi
Apr 1, 2006
9,643
0
Melbs
bullus_hit said:
If we're talking superior economic performance of the 21st Century, China has whipped the sorry arse of every Western economy in the world. The Marxist whackos have edged their way to almost monopolistic dominance of manufacturing, and have now become the defacto lender to all those ailing economies drunk on spending.

Sorry Ludwig and co. but I think it's time to rewrite the history books.
Without getting into the argument as such, where do you you think the average wage earner would be better off living, China whipping it or a Western country being whipped?
 

bullus_hit

Whatchu talkin about Jack?
Apr 3, 2006
12,384
0
mld said:
Without getting into the argument as such, where do you you think the average wage earner would be better off living, China whipping it or a Western country being whipped?
There's winners and losers in any economic system, but if we're talking bridging the gap between the rich and the poor, China is heading in the right direction, whereas most established economies are creating an increasingly larger divide. In America, average Joe hasn't even kept pace with inflation over the past decade, life certainly isn't getting better if that's what you're alluding to.

I won't even begin to the list the Western countries in financial crisis, it would be easier to list the healthy ones. The bottom line is things will get worse before they get better. We've now entered the age of austerity, the days of deficits is slowly drawing to a close, and those who don't balance the books now will bear the deepest wounds.

But back to your original question, would I prefer to live in China or the West? Given I work in South East Asia, the prospect of living in China holds absolutely no fears.
 

Giardiasis

Tiger Legend
Apr 20, 2009
5,447
84
Brisbane
bullus_hit said:
If we're talking superior economic performance of the 21st Century, China has whipped the sorry arse of every Western economy in the world. The Marxist whackos have edged their way to almost monopolistic dominance of manufacturing, and have now become the defacto lender to all those ailing economies drunk on spending.

Sorry Ludwig and co. but I think it's time to rewrite the history books.
You are mistaken if you think the western economies are capitalist. The previous article I assume you skimmed through for all of 5 seconds goes into more detail. Also I think you'll find Chinas's success hasn't been on the back of Moa's 5 year style economic planning, but by pursuing policies that would have Marx turning in his grave.