By on February 13, 2014

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In light of Toyota Australia’s decision to cease all manufacturing operations in Australia by 2017, the Federation of Automotive Products Manufacturers is warning that as many as 33,000 jobs in the supply chain are at risk of following the automakers out of the country.

Just-Auto reports that the lost jobs include those in design, engineering, prototyping, R&D and assembly. FAPM said it was satisfied with the reasons behind Toyota Australia’s production exit, though president Jim Griffin warned of rough seas ahead:

“We may now not have time enough to transition. Our industry has the skills and know-how to be competitive but we need time and assistance to re-shape our businesses, to get new customers and diversify into new markets.”

FAPM chief executive also added that diversification, exporting and/or importing new business models outside of the dying local automotive industry may be the only way through the storm, even if most of their membership won’t make it out alive when the last Aurion and Commodore leave the assembly line in three years’ time.

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275 Comments on “Australian Supplier Association Warns Of 33,000 Jobs Lost In Wake Of Producer Exits...”


  • avatar
    E46M3_333

    .
    They should listen to Pelosi and Obama: losing your job is great–it gives you the opportunity to spend more time with your family, or purse other interests, like writing poetry for example. Too many people in this world suffer from what the Democrats now call “job lock.”
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    • 0 avatar
      MPAVictoria

      Wow you really bought into the Fox News world view haven’t you?
      Very sad.

      If you want to become more informed you could read this:
      http://equitablegrowth.org/2014/02/10/1932/afternoon-must-read-cbo-frequently-asked-questions-about-cbos-estimates-of-the-labor-market-effects-of-the-affordable-care-act

      You probably won’t.

      • 0 avatar
        E46M3_333

        I read the link. So what? Do you refute the notion that offering subsidies like health care and food stamps reduces the incentive to work?
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        • 0 avatar
          MPAVictoria

          Sigh…
          They really have you fooled.

        • 0 avatar
          billfrombuckhead

          So all these countries like Japan, Germany, South Korea, Taiwan, Canada, etc, all have less incentive to work?

          The reality is national healthcare encourages people to go out there own and create new businesses since they’re not slaves to their employers healthcare plan. National healthcare also allows people to leave bad marriages.

          Australia is a resource colony for China at this point, it’s not big enough to be a mass manufacturer of much of anything. If Australia sends billions of dollars worth of mine products and wheat to China, doesn’t it just make sense to take Chinese cars back in return. Is’ not the fault of any government left or right, it’s just basic international trade 101. Australia has no competitive advantage building cars, they tried to make one with the larger rear wheel market but that’s too small to make much of a dent. So American and Chinese built Jeeps are on the way as well as South Korean Chevy’s, Holdens or whatever.

          • 0 avatar
            Big Al from Oz

            @billfrombuckhead
            I think you’ll find even though China is our largest trading partner they don’t receive even 30% of it’s value.

            It’s sort of like saying the US is reliant on Canada for exports.

            China has given us an edge, but even 20 years ago Australia has a prosperous economy.

            I like the Chinese money coming into Australia and China actually in debt to Australia.

            That’s rare in this world.

          • 0 avatar
            RobertRyan

            @BillfromBuckhead
            “So American and Chinese built Jeeps are on the way as well as South Korean Chevy’s, Holdens or China”

            No not at all The US built Jeeps have a niche here.”South Korean and Chinese Chev’ys ” forget about it. GM Daewoo and anything from China is a non-event.

        • 0 avatar
          nrd515

          It’s true, for a very small amount of people, but I’ve never met a single person who was out of work who wanted to stay that way. It’s not a fun life to be broke. Even the people I know who are disabled would work, if they could.

    • 0 avatar
      Pch101

      Yeah, here’s a whiny pinko leftist complaining about “job lock”:

      “[The] key question that ought to be addressed in any healthcare reform legislation is, are we going to continue job-lock or are we going to allow individuals more choice and portability to fit the 21st century workforce?”

      “Job lock” is bad?!?!?! Ridiculous socialist garbage.

      Oh, wait a minute, that quote came from some (g)libertarian Republican dude named Paul Ryan. Oops.

      • 0 avatar
        E46M3_333

        It’s not uncommon for Republican members of the Ruling Class to say stupid things too.
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        • 0 avatar
          Pch101

          So you think that a system that denies healthcare to the self-employed is a good idea. Yeah, that’s pure genius on your part.

          • 0 avatar
            E46M3_333

            Our “system” doesn’t deny health care to anyone.

            Under socialized medicine, people are routinely denied health care–they’re required to wait in long lines, and it’s illegal to pay a doctor for services out of your own pocket if you want to. If that’s not the definition of tyranny, I don’t know what is.
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          • 0 avatar
            agenthex

            > Under socialized medicine, people are routinely denied health care–they’re required to wait in long lines, and it’s illegal to pay a doctor for services out of your own pocket if you want to.

            The claim that it’s illegal to pay for additional services is generally wrong and trivially so, but being wrong on the specifics isn’t the problem here. Socialize medicine is conceptually analogous to socialized roads: they’re mostly good enough for everyone.

            The problem is that being factually correct for most usually takes a back to being ideologically correct. To wit, it’s unlikely that someone from “your side” will ever point out your blatant errors, as long as you continue to spew the right talking points for them.

          • 0 avatar
            mike978

            “Our “system” doesn’t deny health care to anyone.” Yes it does, if you don`t have the means to buy an expensive insurance policy.

            As for so called socialised system, I have more experience with the NHS in the UK than you, so I know what I am talking about, it is not illegal to pay a Doctor. You can take out private health insurance. I work for a large pharma company, based in the UK, and cheap private health insurance was offered. Very few people took the company up on that because the NHS provided a good service. Now I could pay as I had the choice – hardly what I would call tyranny. But then again you are probably one of those who think we live under a Nazi Germany type rule!

          • 0 avatar
            agenthex

            > simple facts

            This is something I’ve often wondered about when people regurgitate material that is trivially refuted by any google search, and the only answer that makes sense is their mode of speech isn’t concerned with dialog but rather simply proselytizing.

            As soldiers of the cause they will say or do whatever is necessary to capture converts or at least rally fellow troops. This would explain why they continue to repeat the same errors even after factual corrections; being correct is a tertiary concern when the main motivation is to push the ideology as if religion.

          • 0 avatar
            Pch101

            “Our ‘system’ doesn’t deny health care to anyone.”

            Well, you’ve certainly just lost your right to be taken seriously (presuming that you ever had it.)

          • 0 avatar
            agenthex

            >“Our ‘system’ doesn’t deny health care to anyone.”
            >Well, you’ve certainly just lost your right to be taken seriously

            To be fair, such an idea does make sense in the worldview where you only deserve what you’ve “earned”, or more literally what you can pay for. The poor simply haven’t earned any right to health (or some while ago, the right to vote), and our system doesn’t certainly doesn’t deny those with the means. It’s an ideology of the rich *sold* to the poor but cleverly without having to pay them.

          • 0 avatar
            GiddyHitch

            “Our “system” doesn’t deny health care to anyone.

            Under socialized medicine, people are routinely denied health care–they’re required to wait in long lines, and it’s illegal to pay a doctor for services out of your own pocket if you want to. If that’s not the definition of tyranny, I don’t know what is.”

            Our system denies a large swath of blue collar workers access to preventative health care in exchange for access to last resort emergency health care that is then subsidized by those that are fortunate enough to have health insurance (vis-a-vis their unpaid ER and hospital bills are recouped by jacking up the price of services and goods for everyone else, thereby redistributing … the wealth … to the proletariat … Wait a minute!)

        • 0 avatar
          ect

          The cost and inefficiency of the US health care system puts the country at a significant disadvantage to its international competition.

          For every $1 per capita spent on health care in the US, other developed countries spend 45-65 cents. But for all this spending, the US has the worst outcomes (results) of any developed country.

          For example, Infant mortality ranges from 4-4.75 per 1,000 live births in all other developed countries. In the US, it’s 6.75.

          The life expectancy of Americans, in both sexes, is 2-5 years less than that in other developed countries, because Americans die from disease at a higher rate – in both sexes and all age groups.

          So, these “socialist” systems do a much better job at a much lower cost (in fact, there are significant variations by country, and countries like Switzerland and the Netherlands -among others- deliver health insurance through private insurance companies)

          In business, we’d call this a catastrophe, immediately try to figure out how our competitors get the results they do at the cost they do, and rush to copy them while we try to figure out how to leapfrog them.

          In US politics, right-wing ideologues use mindless sloganeering to try to stifle any sort of reform.

          • 0 avatar
            Big Al from Oz

            @ect
            I do agree with you about health care. The US has an appalling system.

            The US health care system only benefits the insurance companies, pharmaceuticals, and health professionals.

            Education is another area I believe the US is short changing it’s young with student loans.

            Why not have the students go through college/uni then have a tax surcharge placed on them once their income exceeds a certain amount until the student debt is paid off.

          • 0 avatar
            E46M3_333

            ““Our “system” doesn’t deny health care to anyone.” Yes it does, if you don`t have the means to buy an expensive insurance policy.”

            By that logic, I’m being denied a house on the beach in Malibu.

            Anyone can get health care in this country by walking into any hospital. It’s required by law. And I’m the one being accused of factual errors.

            Health care and insurance policies wouldn’t be so expensive if not for government interference in the first place. Who put the wage controls in place that caused employers to bundle health care with employment? As Milton Friedman said, if you put the government in charge of the Sahara desert, in five years you’d have a shortage of sand. You can see the same thing happening in higher education–the more government subsidizes student loans, the higher the price of education.

            And yes, I’m sure we could give everyone “free” health care like they have in the good old UK. Problem is, free isn’t free. The British pay for it every day in a far reduced standard of living.
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          • 0 avatar
            agenthex

            > Health care and insurance policies wouldn’t be so expensive if not for government interference in the first place.

            You didn’t seem to care about being completely wrong on supplementary care, nor did you care that healthcare costs *substantially* less in all of our competitors all of whom have far more gubmint oversight.

            To reiterate, if you don’t care to be factually correct on anything, and have no compunction about being being shown to be trivially wrong, what exactly are you doing here? Serious question.

          • 0 avatar
            Pch101

            Yes, let’s compare luxury housing and exotic cars to heart surgery and chemotherapy. Why didn’t I think of that?

          • 0 avatar
            doctor olds

            @ect- A significant “fact” you cite is flawed. The US counts every single live birth in the divisor. Other countries do not consider the birth live unless the infant survives a period of time! Sometime up to a month. In America, we try to save every one and count ‘em in the stats. “Figures don’t lie, but liars can figure.”

            As a matter of practical reality, the United States is unrivalled by the entire rest of the world in medical innovation and drug development. The US is the destination of choice for the best medical treatment. A big part of the reason we spend more is because we offer so much more. One example: Check how many MRI units operate outside the US compared to in country. http://www.cdc.gov/nchs/data/hus/2011/123.pdf
            This is one example of a capital intensive device very widely available here and not so much elsewhere. Most recent US data is as of 2007, when More than half of the world’s MRI machines were in operation. It is probable that the current number remains at least 1/2 of the world’s total.

          • 0 avatar
            agenthex

            > As a matter of practical reality, the United States is unrivalled by the entire rest of the world in medical innovation and drug development. The US is the destination of choice for the best medical treatment.

            The US tends to overspend for economically inefficient treatments/diagnostics, and much of that drug development is for lifestyle medications. What usually goes unmentioned is that most of the outcomes gap comes from underserved communities which sometimes have the stats of a third world country.

            If your username is accurate, it’s truly sad that even our doctors often don’t grasp what’s going on.

          • 0 avatar
            doctor olds

            No, I am not a Medical doctor! Just an old Oldsmobile engineer using my college nick name.
            There are plenty of things to criticize and plenty of opportunities for improvement. The issues are complex.

            I stand by my comment.

          • 0 avatar
            agenthex

            You comment simply lacks perspective. Overspending by nearly 10% of US gdp isn’t just some more MRI’s, though they are a popular talking point.

          • 0 avatar
            Pch101

            “The US counts every single live birth in the divisor. Other countries do not consider the birth live unless the infant survives a period of time!”

            I find it astounding that American right-wingers are such dupes for “facts” that are not only false, but that would be easily disproven if they would simply look at the source data.

            When international organizations such as WHO compile infant mortality data, they equalize it so that is comparable between nations. They also subdivide it into subcategories, so it is possible to add up the various times of death so that they aren’t missed. Your assertion is completely false.

            The US has a higher infant mortality rate due to lower levels of prenatal care, which interestingly enough correlates to segments of the population who can’t get prenatal care. The US government is well aware of this; why some of its citizens are not can only be attributed to the US educational budget.

          • 0 avatar
            E46M3_333

            “Yes, let’s compare luxury housing and exotic cars to heart surgery and chemotherapy. Why didn’t I think of that?”

            Heart surgery and chemotherapy aren’t luxuries? Why not? Because you want them and want me to pay for them. Therefore they are necessities. I get it now.
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          • 0 avatar
            ect

            When in doubt, ask an expert. According to the Centres for Disease Control and Prevention, who looked at this question,

            “In 2005, the United States ranked 30th in the world in infant mortality, behind most European countries, Canada, Australia, New Zealand, Hong Kong, Singapore, Japan, and Israel. There are some differences among countries in the reporting of very small infants who may die soon after birth. However, it appears unlikely that differences in reporting are the primary explanation for the United States’ relatively low international ranking. In 2005, 22 countries had infant mortality rates of 5.0 or below. One would have to assume that these countries did not report more than one-third of their infant deaths for their infant mortality rates to equal or exceed the U.S. rate. This level of underreporting appears unlikely for most developed countries.

            The United States compares favorably with Europe in the survival of infants born preterm. Infant mortality rates for preterm infants are lower in the United States than in most European countries. However, infant mortality rates for infants born at 37 weeks of gestation or more are generally higher in the United States than in European countries.

            The primary reason for the United States’ higher infant mortality rate when compared with Europe is the United States’ much higher percentage of preterm births. In 2004, 1 in 8 infants born in the United States were born preterm, compared with 1 in 18 in Ireland and Finland. Preterm infants have much higher rates of death or disability than infants born at 37 weeks of gestation or more (2-4, 6), so the United States’ higher percentage of preterm births has a large effect on infant mortality rates. If the United States had the same gestational age distribution of births as Sweden, the U.S. infant mortality rate (excluding births at less than 22 weeks of gestation) would go from 5.8 to 3.9 infant deaths per 1,000 live births, a 33% decline. These data suggest that preterm birth prevention is crucial to lowering the U.S. infant mortality rate.”

            Countries with universal health care (which include every developed country except the US) do place an emphasis on prenatal care, because healthier babies become healthier adults.

            doctor olds, I agree with you that US-based drug companies do invent a lot of new drugs. Of course, so do large European drug companies. There are big differences in how they’re delivered to the market.

            As one example, in 2003 Congress passed a law that prohibits Medicare/Medicaid from trying to negotiate drug prices – they’re obliged to pay whatever Big Pharma wants to charge them. As a taxpayer, I find that appalling. It also reminds me that Big Pharma has a lot of money to spend on persuading members of Congress to give them these perqs, at our expense.

            It also helps to account for the fact that Americans pay about twice as much for prescription drugs as Canadians do – for the same drugs, made in the same factories, to the same spec.

          • 0 avatar
            agenthex

            > As one example, in 2003 Congress passed a law that prohibits Medicare/Medicaid from trying to negotiate drug prices – they’re obliged to pay whatever Big Pharma wants to charge them.

            To phrase this in the rhetoric of the thread: The government *forces* Medicare to subsidize the pharma industry; it’s very similar to paying pharma employees (not just R&D) extra out of taxpayer pockets, yet it’s called “innovation”.

            All these different subsidies aren’t differences in kind, they’re just differences in word choice. Those dummies armed only with talking points to parrot aren’t just partisan, they’re objectively too stupid to figure out how they’re being tooled.

          • 0 avatar
            doctor olds

            My point re: infant mortality is that the statistics are in fact different between America and the others countries, but I had the wrong attribute. It is not how long the infant survives, but how much it weighs at birth. US counts all.

            “Low birth weight infants are not counted against the “live birth” statistics for many countries reporting low infant mortality rates.

            According to the way statistics are calculated in Canada, Germany, and Austria, a premature baby weighing <500g is not considered a living child.

            But in the U.S., such very low birth weight babies are considered live births. The mortality rate of such babies – considered "unsalvageable" outside of the U.S. and therefore never alive – is extraordinarily high; up to 869 per 1,000 in the first month of life alone. This skews U.S. infant mortality statistics.

            [...]

            Read more: http://www.americanthinker.com/blog/2011/08/infant_mortality_figures_for_us_are_misleading.html#ixzz2tKqnBtEV
            Follow us: @AmericanThinker on Twitter | AmericanThinker on Facebook

            I didn’t say MRI machines are the only reason, but one of the very many more, very expensive technology devices in use in America compared to elsewhere. MRI machines and Cat scanners are just two of the measures.

          • 0 avatar
            Pch101

            It’s as if facts make no difference to some people.

            Again: Statistics that are adjusted for international comparisons still show that the US has a higher infant mortality rate.

            Furthermore, we know why the US rate is higher — it’s because we have lower levels of prenatal care, which lead to more pre-term births, which are riskier.

            This stuff is easy to find out. If you have enough education to have earned an engineering degree, then you have enough education to spend twenty minutes reading information from the CDC, WHO, etc. that will explain all of this. Why you would get your “information” from a right-wing political magazine instead from the sources that prepare the data, I have no idea.

          • 0 avatar
            doctor olds

            The statement I made is based on a factual difference in data. I have not said it is the only issue, just that it is a significant one.

          • 0 avatar
            RobertRyan

            @Pch101
            Rarely do I agree with you. I know someone who has worked in the US healthcare system and they were shocked about the “attitudes” held in that industry.Yes US prenatal care is atrocious, not even “third world” as some “third world” countries have better statistics

            “The US has a higher infant mortality rate due to lower levels of prenatal care, which interestingly enough correlates to segments of the population who can’t get prenatal care.”
            http://thechart.blogs.cnn.com/2011/08/31/u-s-ranks-low-for-newborn-survival/
            “Babies born in Cuba, Malaysia, Portugal, and the United Kingdom have a better chance of surviving the first month compared to those born in the United States, according to researchers at the World Health Organization and Save the Children.”

          • 0 avatar
            Pch101

            “The statement I made is based on a factual difference in data.”

            Explain to me how data that has been **adjusted for comparison purposes** is possibly subject to a “factual difference in data.”

          • 0 avatar
            doctor olds

            Infant mortality numbers commonly cited are NOT adjusted infant mortality rates, whether they are readily available or not. I was wrong in saying other countries don’t count a birth as live until they live a certain period, it has to grow enough, to over 500g in weight before it is considered a live birth in some other countries.

            Feel free to present the adjusted numbers.

          • 0 avatar
            Pch101

            Instead of reading the misnamed “American Thinker”, you could just read the copy-and-paste from the CDC that was provided above.

            Again: adjusted numbers do not support your position. Why do you refuse to look at them?

          • 0 avatar
            doctor olds

            My points are two fold:
            1-Numbers typically bandied about for infant mortality compare apples and oranges due to the birth weight criteria applied in some notable developed countries. The adjusted numbers are certainly lower than those typically cited.
            2-The invention and deployment of advanced technology equipment is an additional cost driver for American average health care costs.

            I also agreed that there are lots of room for improvement and the issues are complex.

          • 0 avatar
            agenthex

            > 2-The invention and deployment of advanced technology equipment is an additional cost driver for American average health care costs.

            Heavily (and I mean *HEAVILY*) subsidizing the whole industry on the hopes that some useful tech pops out is just about the worst way to go about this. Maybe optimistically 10% of any private medical device maker goes into r&d.

            If you want tech, fund it directly at the source of heavy lifting (eg public blue skies research) instead of on the last 20 yards which try to make that work profitable.

            To be clear, we’re talking order of magnitude diffs in efficacy on first principle.

          • 0 avatar
            doctor olds

            Regardless of your opinions about where in the process research should be done and how it should be funded, the empirical facts are that the US develops a preponderance of the new drugs and medical technologies created in the world. The illustrious socialized medical systems in other nations are not producing. America is. And it remains the desired location for the best care in the world.

            Whatever is done to change the system should not destroy this real outcome advantage.

          • 0 avatar
            agenthex

            > Regardless of your opinions about where in the process research should be done and how it should be funded, the empirical facts are that the US develops a preponderance of the new drugs and medical technologies created in the world.

            It’s really quite unfortunate whenever someone who should know better places adherence to political conviction over basic principles of numerical efficiency. A margin gain for 10x+ effort is a waste of resources better used basically anywhere else.

            > And it remains the desired location for the best care in the world.

            As another example, good engineering optimizes for the common case. The US HC system has all signs of atrocious engineering. It’s buoyed only by misguided political conviction and the human motivation to not die.

          • 0 avatar
            ect

            doctor olds, I’ll reach out to you as an intelligent (and often impassioned, which I respect) contributor.

            You point out that the US measures infant mortality differently than many other countries do. And I agree that international aggregators don’t have access to the underlying data necessary to equalize the data reported from national sources.

            From what I have read, though, the US measure is not unique, and often not that much different than that used by other developed countries. Developing countries often use very different metrics, but their experience is not relevant to a cost/outcomes comparison between developed countries.

            The CDC study I quoted from, which was published in 2009 and is easily accessible on their website, confirms that differences in methodology are far from sufficient to deny the fact that infant mortality in the US is significantly higher than in other developed countries.

            I am both American and Canadian, and have personal experience of health care in both countries. I am especially frustrated that the per capita cost of health care in the US is so much higher than in other developed countries, and that Canada, while much less expensive than the US,is still more expensive than many European countries – while politicians and special interests in both countries stifle meaningful debate by resorting to meaningless slogans.

            In Canada, it’s “we don’t want US health care”. In the US, it’s “we don’t want socialist health care”. In both cases, the sloganeering is pure BS, but it acts to stifle meaningful debate.

            European countries apparently accomplish significantly better results at significantly less cost, and they are not shy about using a mix of public and private sector resources to do it. Same with Australia, from what I read.

            The cost per capita of public health care is roughly the same in both Canada and the US. The Canadian system covers everybody, while Medicare/Medicaid covers about 1/3 of the US population. Ouch! Private health care in the US is roughly the cost of Medicare/Medicaid, so the net result is that US health care spending is far above Canadian levels.

            When I play with numbers I discover that, if the US reduced per capita health care costs to Canadian levels, the saving would be about $1 trillion per year. That’s a lot of money. And it seems to me that both countries could save money by adopting the best practices available from other developed countries.

            I’m a pragmatist. I wholeheartedly adopt Deng Xiaoping’s famous statement that

            “It doesn’t matter whether it’s a white cat or a black, I think; a cat that catches mice is a good cat.”

            And I’m not even a fan of cats!

          • 0 avatar
            doctor olds

            @ect- Thanks for the respectful response. I don’t mean to deny problems in the US system, nor to pose as an “expert” on the medical system. My interest is to bring balance to the discussion and to recognize some good things about the American health care system. That is all. The issues are complex, and there are lots of opportunities for improvement. In that sense, I agree with you!

    • 0 avatar
      agenthex

      Is that why you drive a car built in a basically socialist country by union labor? Maybe consider putting some money where that mouth is.

      • 0 avatar
        RobertRyan

        “the empirical facts are that the US develops a preponderance of the new drugs and medical technologies created in the world.”

        No it certainly does not, otherwise it would be a leader in Global Health not a true laggard. A Lot of Companies from across the globe provide high tech equipment and medicines.

        • 0 avatar
          doctor olds

          If you care to inform yourself, you will find what I wrote to be accurate.
          The US develops 60% of the world’s new drugs, as a matter of fact. Here is a link from that notoriously rightwing outlet PBS!(lol)
          http://www.pbs.org/wgbh/pages/frontline/shows/other/themes/controlling.html
          Feel free to look up the share of medical devices invented here. I’ll bet a dollar to a donut that the US preponderance in that arena is similar! ;-)

          • 0 avatar
            agenthex

            > The US develops 60% of the world’s new drugs, as a matter of fact. Here is a link from that notoriously rightwing outlet PBS!(lol)

            As mentioned in the same interview many of these drugs are quite similar, which is akin to GM claiming the most models with rebadges. It’s a PR soundbite, in line with whose mouth it came out of (NPR is the interviewer, btw). The article also touches on what I mentioned about the pittance spent on r&d compared to marketing, etc, and you can guess at which drugs market the best (hint: you don’t need to market those people actually need). Frankly if you actually cared about medical care above politics it’s unconscionable to use money this badly.

          • 0 avatar
            doctor olds

            @Agenthex- You write a lot of words re-affirming your political beliefs, but can’t refute the empirical facts, which exist on their own, independent of political spin.

            There are VERY good things about the US System. You write as if it is all bad and are clearly wrong in that regard.

          • 0 avatar
            agenthex

            > You write a lot of words re-affirming your political beliefs, but can’t refute the empirical facts, which exist on their own, independent of political spin.

            If you look carefully I’ve laid out very simple objective arguments; for example, the r&d inefficiency is a trivial numerical comparison. As to politics, it’s pretty obvious who the worst obstructionists in the US are.

            >There are VERY good things about the US System. You write as if it is all bad and are clearly wrong in that regard.

            The US system is actually very simple to describe: very good for whom money is no object, massively overpriced for the middle, and morally unconscionable for the rest. That’s not really something worth defending.

          • 0 avatar
            RobertRyan

            @agenthex,
            “As mentioned in the same interview many of these drugs are quite similar, which is akin to GM claiming the most models with rebadges. It’s a PR soundbite, in line with whose mouth it came out of (NPR is the interviewer, btw)”

            Exactly and all of this does not stop the declining health standards in the US. Real research is being wasted on side issues.

          • 0 avatar
            RobertRyan

            “There are VERY good things about the US System. You write as if it is all bad and are clearly wrong in that regard.”

            That applies to a lot of health systems, unfortunately the bad outweighs the good.

    • 0 avatar
      daviel

      anybody have recipes for tree bark?

    • 0 avatar
      RobertRyan

      “Did you not bring up the best selling vehicle” Yes I did as the Camry was perceived as having the best OUALITY as well as being the best selling sedan.

      “Best Selling VECHICLE in the US” I think may claim that title with the F150.

  • avatar
    thornmark

    Looks they want guvmint assistance, i.e., a handout. It’s not like they shouldn’t have anticipated the exits.

    They’ll do better if the guvmint tells them they’re on their own. That will cause them to focus and speed up the transition.

  • avatar
    SCE to AUX

    Hmm. Toyota does not exist as a jobs program; it exists to produce cars at a profit, using as few people as possible.

    The job losses are unfortunate, but these people have a few years to prepare for it. I lost my job once, with no notice – just like most places.

    • 0 avatar
      billfrombuckhead

      “Toyota does not exist as a jobs program”, except back In Japan.

    • 0 avatar
      RobertRyan

      @SCE to AUX
      Correct the current South Australian and Victorian Governments are wooing other companies and infrastructure projects to offset job losses.
      The “Productivity Commission” down played the multiplier effect,to an unrealistic level.
      “The numbers of businesses that rely on auto-related work is much larger now than it was in the 1980s after tariff cuts because in the 1980s restructuring for “lean” production outsourced non-core activities. Some submissions to the Productivity Commission last year put these employment “multipliers” at 4.4 in South Australia, suggesting that for every 1,000 car maker jobs lost, 4,400 other jobs will disappear. In Detroit, the automotive multiplier effect has been estimated at 3.6. Note that the Productivity Commission rejected the multiplier effects argument as a justification for industry assistance, but based that conclusion on the questionable authority of a staff research paper”

  • avatar
    28-Cars-Later

    “that as many as 33,000 jobs in the supply chain are at risk of following the automakers out of the country.”

    Risk? Those jobs are toast.

  • avatar
    Ion

    This is on top of the 50,000 already reported. Its only going to get worse as 83,000 plus people now have no money to spend. Anyone with a basic idea of economics can see there will be a trickle down effect. It won’t just be automotive related either. That deli the workers preferred to get breakfast from, the electronics store, general store, etc.

    • 0 avatar
      MPAVictoria

      Yet more people sacrificed on the alter of free trade.

      • 0 avatar
        Pch101

        I don’t see how these jobs can be saved. The Australian auto industry has never been competitive; the country is not well-suited to supporting an auto industry of its own. It’s arguably better to take the pain now, while the unemployment rate is relatively low and there is time to retrain at least some of these workers.

        • 0 avatar
          Big Al from Oz

          @Pch101
          Saved? Why do you want to save jobs that are essentially $60 000 a year form of social security?

          Why not encourage these people to perform productive and REAL value added work for the country.

          It’s a pity we will lose our vehicle industry, but why should I pay additional taxes on my Mazda and my income to employ people (unionist) that I don’t even believe in their ideology.

          Maybe the Union movement in Australia should charge an additional tax on union workers to save union jobs.

          I bet you would see a quick shift in attitude of unionists’ when they find out they have to pay for their own excesses.

          • 0 avatar
            mr_min

            Good news Big Al.
            Instead of paying 5% tariff on your Mazda.
            I’m guessing a once off payment of ~$4000.

            You can now pay taxes every year to support the more than 33,000 unemployed people.

            The problem with the theoretical economics, it is theoretical, and its never backed up by the real world.

            I’m old enough to remember what happened when Nissan Australia closed down, that was bad. This is going to 10 times worse.

            Melbourne might become the new Detroit (Without the Guns :-) )

          • 0 avatar
            thornmark

            >>Maybe the Union movement in Australia should charge an additional tax on union workers to save union jobs.

            I bet you would see a quick shift in attitude of unionists’ when they find out they have to pay for their own excesses.<<

            Supremely intelligent, great insight.

          • 0 avatar
            Big Al from Oz

            @mr_min
            Who will be on social security?

            The removal of subsidisation will create more jobs than it removes. The money will be spent on more productive and profitable ventures and work.

            Those particular jobs don’t exist, but the thousands of dollars in people pockets will be spent across the economy.

            It’s a win, win.

          • 0 avatar
            agenthex

            >The removal of subsidisation will create more jobs than it removes.

            The specifics are a complex calculus not conducive to generalization.

            For example, without massively subsidized car industries, the japanese nor koreans would ever had much of one.

            The problem for Australians is that they’re at a labor and relative transportation cost disadvantage. But economic changes which effect real people are best done by gradually winding/shift rather than arbitrary cataclysms.

          • 0 avatar
            Big Al from Oz

            @agenthex
            What you state is true and no one made any statement that has anything to do with your response.

            If you are familiar with Australian industrial relations, manufacturing you would have known this outcome was most probable back when it all started in the mid 80s.

            This isn’t just an overnight event, but an event that has taken nearly 30 years to unfold.

            The government can create a regulation that states all rocks are to be painted white. This creates a huge industry and market.

            But what value is this rock painting industry to a country. It will create massive employment.

            Vehicle manufacturing is similar, there are some positives from having an auto manufacturing industry. But a when an industry needs to be protected and subsidised is this industry beneficial to the nation? There will be more negatives than positives.

            This can be proven by policy in general in all OECD economies. If they removed protectionism they will climb out of debt and business will perform competitively.

            If an industry isn’t competitive it will die.

            And, because other nations subsidised and protect their industry at the expense of growth do we have to follow suit?

            Like I explained to another person the other day. If some one hits their thumb with a two pound hammer are you any smarter if you use a one pound hammer?

          • 0 avatar
            RobertRyan

            @Big Al from Oz,
            “It’s a win, win.”

            No I have done a fair bit of research into major restructures and it is far from that.
            This article from Factory Equipment News is closer to what really happens.
            http://www.myfen.com.au/news/what-the-departure-of-toyota-holden-and-ford-reall

          • 0 avatar
            agenthex

            > Vehicle manufacturing is similar, there are some positives from having an auto manufacturing industry. But a when an industry needs to be protected and subsidised is this industry beneficial to the nation? There will be more negatives than positives.

            So is it a net positive or negative that the government won’t allow migrants to compete for your job? Your job is fully subsidized by their protection of the borders and work visa restrictions. It just so happens some jobs are physically easier to ship across this barrier.

            Auto manufacturing is hardly a rock painting industry. The specialist skills involved have inherent systemic value not trivially denoted by wages and there exists a certain critical mass for industry to sustain itself. That’s why carmaking et al doesn’t magically sprout out of any ‘ol developing country. Once that base is gone, it might as well be gone forever.

            Capital-based industrialists certainly understand this, so why do those who carry their water have such a hard time?

          • 0 avatar
            Big Al from Oz

            @RobertRyan
            What about Newcastle and Wollongong?

            Two cities almost totally reliant on the steel industry. They have transformed and the cities are wealthier and the better for the demise of those industries.

            I remember people with the same views as you in Newcastle as I was living there when this all occurred. The fear was rampant the unions also encouraging fear.

            What the unions and the Newcastle locals and you are stating just didn’t eventuate.

            Now look at BHP. BHP also stated it wasn’t so sure about it’s future.

            Rob it’s the unknown that you are scared of.

            I do feel sorry for the individual, but I don’t look at the individual. The individual will survive and be disgruntled that his subsidised lifestyle is gone.

            Farming has gone down the same path in Australia and so will food processing. But knew and better technologies are keeping competitive in some areas of food processing.

            We must concentrate on what we are good at. That way we will always be in front.

            Australia has been and will always be a provider of raw materials, commodities and food. We just don’t need to compete with the rest of the lower paid economies at manufacturing. Manufacturing of many consumer products has gone the way of the clothing industry.

            Like I state we should do what we do best. Yes we can make cars good as well, but we just can’t turn a real profit with them.

            This profit is what gives us our standard of living.

            Let the US/Europeans and Asians pump taxpayers’s dollars into their industries. Because we will benefit more from other countries taxpayers and not use our taxes. Especially for consumer items.

          • 0 avatar
            Big Al from Oz

            @mr_min
            If you look at the GFC and the countries that are in deep $hit you will see they are the most heavily protected and subsidised economies.

            Even the German’s started to restructure their economy and finances when unification occurred. How well are they doing for a Euro nation?

            What about Switzerland? Hong Kong, Singapore. Australia?

            Do a little research then we will debate the benefits of liberalising economies.

          • 0 avatar
            agenthex

            big al wrote:
            > Hong Kong, Singapore. Australia? Do a little research then we will debate the benefits of liberalising economies.

            Whenever folks trot these out (Friedman is certainly fond) they forget that HK/etc were ports of call for the british empire, hardly a shining example of free anything unless you define two parties at different ends of a gun equal trade partners. Port cities are also quite well naturally endowed to benefit from inland trade, in the same way that Australia (and the US) is naturally endowed with massive natural resources. Free money out of the ground is always good esp if spread around to everyone. It’s also worth noting that some 60% of singapore industry is gov owned.

            So, shall we debate the benefits once you figure out how much gov is subsidizing your job by keeping the competitors out?

          • 0 avatar
            RobertRyan

            @Big Al From Oz,
            “@RobertRyan
            “What about Newcastle and Wollongong?”

            Newcastle was the recipient of Government Planning and money , after someone realized that it had great beaches, fantastic wineries and scenery and low housing prices.
            It has become an upmarket place to live although jobs are still scarce outside of tourism. That realization only took 70yrs.
            Wollongong is still a basket case a lot of long term unemployed are based in the suburbs. Yes it now has a top rate University, but getting the upper middle class to settle there is a struggle ,although it offers the advantages of Newcastle.

      • 0 avatar

        Nobody is “sacrificed”. Toyota is not going to execute plant workers at the day the plant is closed. Instead, they are freed to do something more useful for society.

        P.S. Pch101 made an insightful comment downthread, “The more likely outcome is that most of those people will end up earning less. Many of these workers and managers are narrow specialists who won’t easily adapt to change.” It is probably true, short term at least. But what they really make out of themselves is up to them. They are free to sit on unemployment assistance, inject heroin, and whine about furrigners stealing jobs. Or do something more productive.

        • 0 avatar
          agenthex

          > But what they really make out of themselves is up to them. They are free to sit on unemployment assistance, inject heroin, and whine about furrigners stealing jobs. Or do something more productive.

          Just wondering, do you do something which someone else in the world won’t do for less? Why aren’t they there replacing you? Maybe something do with your gubmint?

        • 0 avatar
          Big Al from Oz

          @Pete Zaitcev
          Australia isn’t America this rarely occurs.

          Our youth still have an opportunity to make a better living than their parents, unlike the US and Europe.

    • 0 avatar
      Big Al from Oz

      @Ion
      ‘On top of’ what?

      The figure first started out at 50 000 by some. It is now down to 33 000 by others.

      There will be no loss of employment in Australia, only an increase in jobs.

      The estimated cost of car price reduction will be around $3 000 per vehicle. This money alone times 1.2 million vehicles sold will put much more wealth back into the economy.

      The good thing about this is most of the money will go to smaller business who are far more productive and will create more wealth.

      Or pay down some of the debt Australia has incurred during the GFC.

      • 0 avatar
        Ion

        It’s 50,000 auto workers and 33,000 supply workers. I’m curious, Do you have unemployment benefits in Australia? Furthermore what’s putting that money into small businesses? The government?

      • 0 avatar
        Athos Nobile

        Cars won’t get any cheaper when local manufacturing goes. Even if the government drops the remaining 5% tariff as some are suggesting. Or the LCT, which has in Toyota its biggest payer. You’re deluding yourself.

        • 0 avatar
          Pch101

          Eliminating the 5% tariff would help a bit. Surely some automaker would cut prices by at least some of the 5%, which would pressure others to follow.

          Eliminating the luxury car tax would probably yield substantial discounts for higher-end cars for similar reasons, as prices could be cut to increase volume without losing margins.

          But the small/remote market and exchange rate risk premiums would remain. A bargain hunter’s paradise is highly unlikely. On the upside, perhaps they can borrow a page from the Kiwis, and start imported used cars en masse from Japan.

          • 0 avatar
            RobertRyan

            @Pch101
            Not going to do that either. New Zealanders are not too happy about some the Grey imports they have been receiving.

          • 0 avatar
            Big Al from Oz

            @Pch101
            Wow, what a view of the world you have??

            What one horse town do you live in?

            Australia has the most competitive vehicle market. Something the US should aspire to.

            Grey imports??? We already have that and it’s only a niche market.

            The local manufacturing industry has had little effect on what we buy or the importers bring in.

            If that was the case why didn’t the importers import 6 and 8 cylinder vehicles?

            You talk some real crap. Learn the industry sunshine so you stop looking like a fool with your commentary.

          • 0 avatar
            Athos Nobile

            Pch, I don’t think any OEM will transfer the savings to the customer unless competition forces them to.

            I saw an article about how the 3-series BMW price evolved over a 10 years period. Not a lot of variation. Tariffs went down significantly during that time, but in AU$, price remained similar. The car is more affordable nowadays because income has increased.

            Removing the LCT will certainly help the high end manufacturers and some of the mainstream too. Toyota for example will be very happy to see the LCT removed.

            Importing grey market JDM or UK cars may seem like a good idea… on paper. In reality, it will make the country’s fleet older as it’s already happening with the Kiwis. Possibly even unsafer/dirtier.

            Grey market cars have some restrictions here, one of them being that only vehicles not originally sold can be imported. Only registered shops can bring them in, need to be complianced… that means paperwork$, fee$, taxe$…

          • 0 avatar
            Pch101

            BMW is a luxury brand that fights hard to maintain its price points. I wouldn’t say that it’s a good indicator of the overall market.

            But if an automaker such as Mazda cuts prices by a few percent, then it seems likely that its direct rivals will feel pressured to follow suit.

            But a few percent isn’t very much. The Aussie market isn’t large enough to justify major price wars that are more likely to produce losses than profits. (The small market doesn’t provide much opportunity for upside.)

            Some of the luxury makes such as Porsche have already slashed some prices. I doubt that they would pass on the full benefit of a removal of the LCT, but keeping prices exactly as is also seems unlikely.

            I was joking about copying the Kiwis. But it wouldn’t be a bad idea, particularly without a domestic industry to protect.

        • 0 avatar
          RobertRyan

          @Athos Nobile,
          Agreed they will not be vastly cheaper. The US versions of Audi’s, Mercedes are a lot cheaper but they are only LHD.

      • 0 avatar
        Big Al from Oz

        @Ion
        Australia doesn’t have 50 000 auto workers.

      • 0 avatar
        charly

        You forget the massive tax subsidies for buying a car. Normal, none car producing countries, tax new cars massively (100% isn’t unusual) So now expect the same to happen to you.

        • 0 avatar
          Pch101

          Australia is a suburbanized, car-dependent country with a lot of open space and only spotty public transit. The odds of Singapore-style car taxation are about zero.

          • 0 avatar
            Big Al from Oz

            @Pch101
            Actually Australia public transport system on average is better than what you have in the US.

            Cities like New York and maybe Chicago are better, but then that’s only in inner city areas.

            But overall we are a car country. We probably are more mobile than the average US citizen.

            You guys just don’t seem to drive the distances we do.

          • 0 avatar
            charly

            The most sold type of car aren’t the cheapest kind. Tax the cheap so they will cost just as much as the most sold now and you have your sustainable tax rate (plus an ungodly amount of money)

  • avatar
    Big Al from Oz

    I think it should read 2 billion dollars a year worth of jobs gained by the economy having that much more money to spend and not lost in taxation to subsidise.

    Remember we don’t have a problem with our car market. If cars become up to several thousand dollars cheaper like they have predicted, then people will also have that money to spend in the economy creating jobs.

    In 1990 a Nissan Pulsar was about $20 000 and wages were 50% of today. Today a Nissan Pulsar is $20 000. So did we make the correct decision by removing protectionism?

    The figure quoted 2 days ago was 50 000 by some. I stated that that many will not lose their jobs.

    33 000 job lost no. They have 3 years to retrain and/or look for a new job.

    So the figure will be much lower, most likely we need to immigration to keep pace with the jobs created.

    • 0 avatar

      While all true, the subsidies aren’t going to be freed unless a reduction in tax burden occurs. They’ll just re-direct the subsidy to some favourite, like providing free stuff for certain people that happen to have a hereditary advantage.

      • 0 avatar
        Big Al from Oz

        @Pete Zaitcev
        I hope the tax does drop. But even Australia borrowed during this GFC as well and I would like to think this money will pay down debt first.

        Or better still this money is put into and top of current infrastructure development for motor vehicles.

        • 0 avatar
          charly

          Tariff will go to be replaced by a car tax. Expect 40% of a new car price to be tax as governments love money and hate current account deficits.

          • 0 avatar
            Big Al from Oz

            @charly
            Australia has so far resisted the disease of the ‘old countries’ of heavy debt.

            We are currently looking at ways to reduce this debt, whilst our northern hemisphere cousins are trying to have stable economies first, so they can then try and reduce debt.

            I hope they don’t fall into a heap while experimenting. But, even as broke as they are they are still using their ‘credit cards’ to prop up inefficient industries that would die if they weren’t protected.

          • 0 avatar
            charly

            debt and current account deficits are not the same thing. One is money the state owns and the other is the difference between exports and imports. Debt is not so important as the other one.

  • avatar
    Ron B.

    Since 1997 The Australian tax payer paid GMH,Ford and Toyota a total sum of 30 Billion dollars in the form of government assistance.
    Every year in Australia the number of people who are made redundant for one reason or another Averages out to 350,000. The majority of these laid off workers find work immediately .
    We,the tax payers of Australia have long been tired of car companies marching up to the government of the day and demanding X amount of money or they would pull out. Toyota recently received a gift of $260,000,000 to develop a green camry..What did we get ? a hybrid,which they already had in production in other markets. GMH and Ford have done the same on many occasions.Although this says more about the gullibility of the politicos who were all to keen to receive the success fees for handing over the money it also says a lot about the Greed of the companies involved .
    A boycott of their crappy products would save us even more money in future I think.
    With a population of just 22 million and a work force of taxpayers at 6 million (roughly) it is a wonder that this scandal of car company largess is remarkable in that the country has absorbed the financial loss .
    A LNP MP suggested yesterday Morning that the car companies be asked to hand back a lot of the money ,but revealed that although GMH had been demanding more money,It hadn’t spent all of the monies from a previous handout .
    Another company in the news here is Coka cola amatil who have just received 20 million from the state of Victoria…to save jobs. This is a company whose profit was 200 million for the 6 months up to last month.
    I think I will ask my local MP for a cash gift to support my business or I may have to lay myself off as redundant. They can do it so easily ,it should be a snap.

  • avatar
    Turkina

    I don’t like this at all. I remember all the tears over the possibility of the US auto industry getting whacked, and the ripple effects it would have throughout the economy. What happens if the Australian dollar weakens? You can’t go back and build autos again once you get rid of the labor force.

    • 0 avatar
      Lorenzo

      More nimble industries will take advantage of a weaker AU$ and lower energy prices might draw in energy-intensive industry. The problem is still going to be high wages and heavy regulation.

      • 0 avatar
        Pch101

        The more likely outcome is that most of those people will end up earning less. Many of these workers and managers are narrow specialists who won’t easily adapt to change.

        It may not be possible or even desirable to attempt to hold back the tide, but at least let’s be honest about the likely outcome. It may be the better alternative in the macro — the capital can be better deployed elsewhere — but there are some within the society who will be left behind.

      • 0 avatar
        billfrombuckhead

        Yeah like heavily regulated and unionized Germany,the world’s greatest exporter :D

        • 0 avatar
          Big Al from Oz

          @billfrombuckhead
          The US has a more regulated protected and subsidised auto industry than the Germans.

          The Germans subsidise each vehicle to the tune of $1 300 and the US is subsidising at $3 000.

          If my maths is good the US is subsidising two and a half times what the German’s are.

          Sort of the pot calling the kettle black.

          Or, you just are full of $hit.

    • 0 avatar
      Big Al from Oz

      @Turkina
      What if the US turns into an Argentina and a meteorite slams into Texas?

      The outcome you speak of is unlikely to occur for years. Australia’s debt is low. We can borrow for well over a decade before we even reach similar levels of debt equivalent to the US and other indebted OECD economies.

      But, we have a responsible government. Our dollar will drop to the mid 80s.

      Even if the $hit hits the fan globally, we are better positioned than most any country to sustain ourselves. This again will make the AUD attractive.

    • 0 avatar

      UK got back to building autos, no problem.

      • 0 avatar
        Pch101

        The UK is an hour from the European mainland, and has a population of its own of over 60 million.

        Australia has a third of the population and isn’t close to anything. It’s easier just to import there.

        Had it not been for the fact that the Aussies imposed fairly steep import tariffs and local content requirements for most of the last century, there wouldn’t have been an auto industry for nearly this long. Scale economies are not possible there, unlike the UK.

        • 0 avatar
          RobertRyan

          @Pch101
          Subsidies and Non-Tariif restrictions are the only thing keeping the US Industry going. Still it has failed to stop the decline of the US Industry.Companies are still outsourcing overseas and sales are stating to slow after a fairly minor “burst”

      • 0 avatar
        RobertRyan

        @Peter Zaitcev,
        “UK got back to building autos, no problem.”
        Exactly as they have reinvented their industry making it much more competitive. Unlike the US.
        As far as the “Tyranny of distance” falsehood goes, we do not live in the 18th Century. High wage builders like Mercedes, BMW etc export globally on a vast scale. Volvo is the second biggest Truck Maker on the planet and exports everywhere. Remember Sweden is a “tiny country” of 8 Million.

  • avatar

    I still think it’s a very pretty car in the lead picture.

  • avatar
    agenthex

    I’ve read through some of these threads and there’s a trend where many believe the subsidy of industry isn’t just wrongly implemented in the specific but wrong in principle. They seem to hark back to the days of the yew farmer who creates with his own two hands free from the vice of gubmint interference.

    As idyllic this view is, it’s also quaint nevermind ridiculously delusional for something like the auto industry. Every single successful auto giant has been the beneficiary of government (ie collective) will, from the forces which builds road (quite $$) so these cars have some use to conglomerates like Hyundai, or all of postwar japan,etc which are wholly artificial creation of.

    So it may be the case that it doesn’t make *specific* sense for Au to subsidize this industry given a cost/benefit calculation (more complex than it superficially seems given the downstream effects), but the idea that it’s some sort of moral corruption is so downright *simple* that it’s beneath fairy-tales told to children.

    • 0 avatar
      billfrombuckhead

      Well said. The free market fundamentalist crowd in America are like children who live in some fairy tale.

    • 0 avatar

      I don’t think that “it’s how it was always done by every corrupt statist regime therefore that’s how it must be done” displays enough sophistication to look down on proponents of free markets and smear them with “fairy-tales” labels.

      • 0 avatar
        agenthex

        Fortunately there are stateless places on our plane of existence that proponent of free markets can visit (against corrupt state dept. advisories) to try their hand.

        Otherwise when they speak of beautiful lands that existed either long long ago or a in a place far far away it’s hard to make the distinction except fairytales are more honestly portrayed as stories rather than reality.

    • 0 avatar
      RobertRyan

      @agenthex,
      When the companies tried to export the US HQ’s were not impressed. and killed those export markets by getting others to export to those places. Only Toyota saw Australia as a good place to export from and exported 2 million Camry’s to other parts of the world.

    • 0 avatar
      Pch101

      The ideologues don’t tend to have a good grasp on reality. Of course, if one is going to be a slave to ideology, then it’s best to not allow little things such as facts, data and history to get in the way.

      That being said, some industries are difficult to support in certain places, and that is certainly the case with the automotive industry in the antipodes. Without legal barriers to force the issue, there’s no compelling reason for a producer to produce there — there is neither scale nor any particular location benefit.

      • 0 avatar
        agenthex

        > That being said, some industries are difficult to support in certain places, and that is certainly the case with the automotive industry in the antipodes. Without legal barriers to force the issue, there’s no compelling reason for a producer to produce there — there is neither scale nor any particular location benefit.

        The larger point is that “legal barriers to force the issue” are far more pervasive than most all realize. Consider for example a typical white collar service sector jock making $80k who’s quick to laugh at the misfortunes of manufacturing. I can almost guarantee that someone willing to do the same work for $40k exists. So that job is essentially subsidized to the tune of $40k by arbitrary and artificially imposed legal barriers. It’s completely incidental that some jobs are more porous across these *arbitrary* barriers, and a true economic analysis can’t selective assume some barriers more sacrosanct.

        • 0 avatar
          Pch101

          If you’re noting that immigration laws serve as an import barrier, then of course you are correct.

          It seems to be par for the course that white collar workers sneer at the blue collar workers, while forgetting that there are one billion Indians who are about ready to eat their proverbial lunches. (And boy, are they hungry.)

      • 0 avatar
        RobertRyan

        @Pch101,
        You are Dogmatic about a fallacy. The car industry does thrive in Australia but not the three Foreign owned subsidiaries of US and Japanese companies. Aftermarket is booming, other aspects not tied to to the three car companies are also doing well.

        • 0 avatar
          doctor olds

          Face it Ryan, Australia’s days of manufacturing vehicles are numbered. The term auto industry can include aftermarket, but more typically means OEM. You will have ZERO OEM’s soon.

          • 0 avatar
            RobertRyan

            “Face it Ryan, Australia’s days of manufacturing vehicles are numbered.”
            So it appears will be the US’s. If GM and Chrysler had not been expensively raised from the dead, then Ford could not have soldiered on.
            You are still far from having a healthy Automotive or related industries they are still failing.
            As of the 10th of February 2014.
            http://www.elkharttruth.com/news/business/rv-industry/2014/02/10/Elkhart-Monaco-RV-plant-closes.html

            “The term auto industry can include aftermarket,” It includes them and anything connected to the Automotive Industry sales etc.

          • 0 avatar
            doctor olds

            The US auto sector “bailout” is very, very much less one time expense per citizen than the ongoing subsidies that propped up your industry for years. A tiny sum, in proportion to the size of the industry.

            Meanwhile, GM alone has invested well over the cost of the bailout in capital improvements in America. There is no question but that all three US based companies are financially sound and profitable today, and at no risk of failure. Warren Buffett is betting big on GM and Ford by buying their stock and I am confident he is more in tune with what’s real than you are.

            You will not grasp this, not willing or not able, I expect, but it is reality.

          • 0 avatar
            RobertRyan

            “You will not grasp this, not willing or not able, I expect, but it is reality”

            Your reality no one elses.

            “A tiny sum, in proportion to the size of the industry.”

            83 Billion all up to rescue 2 Bankrupt and a tottering 3rd Automaker? Capitalist countries do not revive the dead. Maybe Marxist ones did.

            “There is no question but that all three US based companies are financially sound and profitable today”

            Well FCA is not now US based, it has factories in NA.”Financially sound” big call.

            “Warren Buffett is betting big on GM and Ford by buying their stock and I am confident he is more in tune with what’s real than you are.”

            Warren has bought and sold stock all his life. He is not a chartist but has bought and sold stock over short periods.

  • avatar
    Spike_in_Brisbane

    Car manufacturing plants are now like the Olympics. They go to the country whose government has the largest wallet with the loosest purse strings. See Thailand, China, UK. In the U.S. the availability of subsidies is a state based competition.

    • 0 avatar
      doctor olds

      You have that right, Spike! We don’t have a national industrial policy. Individual states do, and their goal is to screw the other states to grab the business! The amount of money involved compared to the immense cash flow of the business is almost trivial, though in the hundreds of $millions.

      • 0 avatar
        RobertRyan

        “You have that right, Spike! We don’t have a national industrial policy. Individual states do, and their goal is to screw the other states to grab the business! ”

        Exactly heavily subsidized without it no US manufacturing, OEMS will go elsewhere.

        • 0 avatar
          doctor olds

          What I wrote certainly doesn’t support your notion of “heavy subsidy”. That might describe your government providing more every year for your tiny industry than the one time offers of some of our states to attract construction of a Vehicle Assembly Plant. Small change in the scheme of things. These plants are multi-billion dollar annual money machines.

          You really need some help understanding the difference between millions and billions.

          The US is a low cost producer compared to Japan and Germany, not far above Korea, and are producing the highest quality in the world today. Our industry isn’t going anywhere, and, as proof, 10′s of $billions are being invested in the industry in America right now.

          • 0 avatar
            RobertRyan

            “The US is a low cost producer compared to Japan and Germany, not far above Korea, and are producing the highest quality in the world today. ”

            It is not , that is why production is still moving away from the US. Marchionne still wants to build Jeeps in Italy and now China.
            US Vehicles are still lousy quality, maybe a reason for lower prices?

          • 0 avatar
            doctor olds

            Ryan- there is no sense in me going on with you. What I wrote is on the money. You are simply misinformed. Or is it willful ignorance to stir trouble?

            GM commands the highest transaction prices and by objective measures is building the highest quality cars in the country, which are better than anywhere except one Toyota plant in Japan producing low volume Lexus.

          • 0 avatar
            RobertRyan

            “Ryan- there is no sense in me going on with you. What I wrote is on the money”

            What you have been writing borders on total fantasy.
            The best selling sedan in the US incredibly for the past 12yrs has been the Toyota Camry. A fact. No GM vehicle comes close in longevity and sales and I do not Like Toyota.

          • 0 avatar
            doctor olds

            Ryan, Who sells the most vehicles in America?(hint- it isn’t Toyota or Ford)

          • 0 avatar
            RobertRyan

            “Ryan, Who sells the most vehicles in America?(hint- it isn’t Toyota or Ford)”

            Well we have changed from talking about QUALITY to saying who sells the most VEHICLES.The Toyota Camry was perceived as having the best quality and dependability of any US Sedan. Testimony to its record run.

            Toyota still sells the top selling SEDAN(which is a VEHICLE) in the US. Outside the US it is the biggest seller of VEHICLES Globally.

          • 0 avatar
            doctor olds

            For God’s sake Ryan, can’t you even remember that it was yourself who brought up the single best selling sedan?

            In America:
            Highest quality today- GM
            Highest transaction prices- GM
            Largest seller- GM

            Facts. look them up.

  • avatar
    Atum

    Vinny’s (an Australian version of Goodwill that I saw on Wife Swap Australia) will be rolling in the cash in 2017.

    It’s a bummer that three major car companies have to pull manufacturing jobs out of the country. There’s something behind this. Probably unions…

    • 0 avatar
      RobertRyan

      @Atum,
      Overall the 30,00 jobs will be absorbed quickly, not so much for the people over 45.
      The Three Car companies only accounted for 14% of the cars sold, so not a massive loss.

      • 0 avatar
        Atum

        Considering that Ford, Toyota, and Australia’s GM division only sold 14% of the vehicles, it makes me curious what Australians drive…

        Hmm, the 2014 Kangaroo! Imported from the plains of Northern Territory, the Kangaroo has a soft brown exterior and a comfortable pouch seat for one! Safety is our number one priority; that’s why the Kangaroo uses it’s big feet to kick away any moving vehicles, or other moving Kangaroos! To keep the Kangaroo moving, it needs one gallon of water for every 35 kilometers traveled! That’s pretty spiffy! Come by your local zoo and buy the 2014 Kangaroo today!

        (Your zoo is not responsible for the death or aggression that may come with the 2014 Kangaroo).

        • 0 avatar
          Big Al from Oz

          @Atum
          Pretty much what the world has to offer.

          We have a very varied market with over sixty manufacturers represented.

          As for the Kangaroos, up in the Top End of the NT, you’ll see wallabies more so than kangaroos. Wallabies are smaller and tend to live in the woodlands/forests.

          Kangaroos like the open grasslands and savannas.

          With a bullbar the wallabies aren’t a real issue. But the buffalo and cattle can cause some real damage.

          Camels are worse and emus with their long legs are lethal, they go through windscreens (windshields).

  • avatar
    agenthex

    Fundamental to any discussion of subsidy/tariffs of goods vs “free trade” is its labor twin of free movement/immigration. As long as a Mexican can’t freely move to the US (or Indonesian to Aus) to work at fraction of the wages some degree of economic subsidy is implied. In this case it’s the *artificial* (ie “statist”) constraint of labor supply which necessarily inflates wages. Blue collar work is the most fungible (and therefore first to outsource) but there are plenty of people in lessor economies with qualified degrees to do all but the most sophisticated jobs.

    So unless any of these commentators living cushy first world lives are volunteering to freely compete with developing world labor they need to learn the apropos lesson here of put up or shut up.

    • 0 avatar
      agenthex

      Also, it’s not without considerable irony that some of the biggest populist proponents of free markets/trade also the most protectionist against dem foreigners takin’ ur’ jerbs.

      • 0 avatar
        JD23

        I work in a technology related job that would be summarily outsourced if it were profitable to do so. Nearly all of my coworkers are from Asia, but are some of their countries’ best and brightest; they came here for grad school, received PhDs, and stayed in the US to work on H1-Bs. Much of the repetitive, less advanced work has been outsourced, however.

  • avatar
    Big Al from Oz

    @Pete Zaitcev
    Here’s a link to support my comment on the best country for our youth to reach their full potential. ‘America ain’t it’. Actually Canada rates quite well.

    Also, you will soon find out that Pch101 doesn’t have much knowledge of much.

    He will talk trash. He rarely can support any comment he makes as it is just, well, trash.

    http://www.huffingtonpost.com/hung-vo/youth-development-america_b_4674097.html

    • 0 avatar
      agenthex

      Speaking of talking trash, did you get around to checking if those elsewhere in the world with your skillset exist who’ll work for less, and subtract that from you income to see how much the government subsidizes your job?

      • 0 avatar
        Big Al from Oz

        @agenthex
        I think you need a course in economics.

        First, the countries don’t have the benefits we have with resources and farming. Even though these two industries directly represent about 13% of our GDP.

        Most every OECD economy has heavily subsidised agriculture. We don’t and our farmers do quite well, as they had to be efficient.

        How can you then determine a service based job internationally. I just can’t work. Yes, some service industry jobs are off shored, but very few.

        So how can you compare service industry jobs, when they make up over 70% of GDP?

        So now we have between 83% and 85% of our economy that can’t be compared to oversea’s jobs.

        We will now add 7% for tourism. How can that be out sourced? It is competitive, but it is still unique to Australia.

        I think with all of your big words etc you’d better hit the books and learn a little.

        Because it’s apparent you are talking through an orifice.

        • 0 avatar
          agenthex

          > I think you need a course in economics.

          Perhaps, but not from such a poorly informed teacher.

          > How can you then determine a service based job internationally. I just can’t work. Yes, some service industry jobs are off shored, but very few. So how can you compare service industry jobs, when they make up over 70% of GDP?

          Why don’t we find out by opening the immigration flood gates? Plenty of poor-ish people in the world who already speak english and I’m sure plenty more when there are Oz level incomes to be had by taking the first boat there. Who do you think is preventing them from doing so right now?

          > Because it’s apparent you are talking through an orifice.

          Do you honestly believe you’re in a position to determine this? You sure have a lot of trouble figuring out the very basic fact that the same entity that’s artificially subsidizing your job by keeping the foreigners out is the same one sometimes subsidizing manufacturing.

          • 0 avatar
            Big Al from Oz

            @agenthex
            Immigration? So you believe in open borders?

            Again, your response is not worthy.

            My discussion isn’t hypothetical. You can surmise all you want.

            But the reality is this. Heavily subsidised economies will not survive into the future.

            Because many of those people you are talking about are staying within their countries producing.

            The one’s crossing borders are generally ill educated and can’t be productive in our societies. They come from war ravaged societies. So how can they increase out GDP greatly?

            When the ‘Western World’ needed unskilled workers in the early part and mid part of the 20th century your views had some relevance. But now, the world has changed.

            It’s called globalisation. I think you are living in the past.

            So, where is your argument.

            Many OECD economies will have to reduce their standards of living to be competitive with the countries those people you talk of come from.

            So why subsidise? Where is the money coming from for this subsidisation? Borrowings?

            This is what killing the OECD, debt.

            You are another one who believes in increasing debt.

            A left wing Keynesian.

          • 0 avatar
            agenthex

            > Immigration? So you believe in open borders?

            It’s not so much what I “believe” as what options are available to reducing labor cost by replacing overpaid ozzies.

            > The one’s crossing borders are generally ill educated and can’t be productive in our societies. They come from war ravaged societies.

            The ones crossing borders *illegally* are those with the least to lose by working without state permission. Rest assured there are plenty of people in the developing world capable of grasping what I’m saying here; they will have no trouble replacing you at a fraction of the cost.

            The main issue though is that often people believe they understand a subject such as econ because they can parrot political talking points. For example, you speak of Keynes, but I’d wager at *any* odds you’ve never in your life read his work, because it does require some intellect. So what puts you in a position to evaluate it when you don’t know what he’s said?

          • 0 avatar
            Big Al from Oz

            @agenthex
            Your statements have actually supported my argument.

            1. Australia has liberalised it’s economy, with the reduction of protection and subsidisation. It is now one of the freest markets in the world.

            2. Australia has one of the most open and largest immigration policies in the world.

            Look at our economy it has been growing at above 3% for over 2 decades. But, this all started back over 3 decades ago. The US has a long way to catch up.

            Look at the nations that aren’t so free. They have more protection and less liberal economies. They are the ones in trouble.

            Like I stated look at the Germans. They have expended much energy in restructuring their country since unification.

            I think you should reassess you comments again.

            I’m correct in that countries should liberalise economies and allow for more immigration, like Australia.

            You more or less stated so yourself.

          • 0 avatar
            agenthex

            > I’m correct in that countries should liberalise economies and allow for more immigration, like Australia.

            From my point of view, the problem is that you don’t know enough about the rest of the world to see that your skillset wouldn’t be worth much should open immigration be a thing.

            Since you seem to take some pride in knowing something about econ I guess, consider researching the average wages for various educational attainment levels in developing countries (BRIC will do). Maybe once you’re aware that you’ll have to take a *massive* pay cut without the government protecting your job the rest will click in place.

          • 0 avatar
            Big Al from Oz

            @agenthex
            So, now it’s down to put downs?

            Your comments support my arguments on removing protection and subsidisation.

            This opens borders without the immigration problems.

            You talk of the people around the world that want to work in Australia.

            Australia has opened the world to them through reduced protectionism and subsidisation.

            We have a very liberal immigration policy as well to allow these people into our country.

            This is in effect what you have stated.

            Open the borders, we have done this and are competing with these countries better than many other OECD economies.

            I guess by the looks of things we agree.

            Open up borders, like Australia has done.

            But with a modern globalised world the people don’t actually have to be in Australia to compete fairly.

            Welcome to the modern world.

          • 0 avatar
            agenthex

            So essentially you can’t do the most basic research to see how much your job is worth on the open world market, yet at the same time claim to be proficient at econ.

            Have you ever met someone who claimed expertise you know they can’t possibly have? Like the guy thinks himself a math pro yet can’t solve basic equations? Try really hard to picture how you felt then; now you know others feel when they see you parrot these talking points.

            > We have a very liberal immigration policy as well to allow these people into our country.

            You don’t seem to understand what open borders means; it means your employer is free to hire someone from India to replace you at the rate you would’ve found were you capable of basic research. They’d be stupid not to.

          • 0 avatar
            Big Al from Oz

            @agenthex
            Again more put downs.

            You believe in protectionism and subsidisation.

            I have shown you that what you preach doesn’t match your paradigms.

            As I support your views. Except my views are against your political paradigms.

            As for my pay I’m a capitalist. As a matter of fact I would be paid very reasonably most any place I want to work.

            Comparatively speaking I would probably have more purchasing power in a developing nation, even a BRIC.

            But why would I want to move? I’m living in a fantastic country that is offering most everyone the great life.

          • 0 avatar
            agenthex

            > As for my pay I’m a capitalist. As a matter of fact I would be paid very reasonably most any place I want to work.

            Most places in the world don’t pay well for those who lack basic fact-finding skills. For example:

            > But why would I want to move? I’m living in a fantastic country that is offering most everyone the great life.

            It’s obvious you still don’t grasp what open immigration means, even when it’s been explained with pretty small words. It means they come replace you in Aus/Oz, you don’t have to go to replace them. Those are pretty much the smallest words I know, sorry.

            Also, how are you supposed to understand my political position if you can’t even get the simple ideas like open immigration?

          • 0 avatar
            Big Al from Oz

            @agenthex
            You sound like a conspiracy theorist, maybe you should give advice to organised labour;)

            You really believe what you have been stating?

            How can protectionism and debt be useful? Especially the current state the US economy is in?

            Who’s going to pay for your excesses?

            I think you might have a poor grasp of the situation, ie, what is real and what isn’t.

            The US will shift policy and restructure. It has nowhere else to go.

            You will liberalise your agri industry and reduce protection and subsidisation. So will the Europeans and Japanese.

            You will restructure your health system. This is only the beginning. It’s unaffordable and unsustainable as the populace grow older.

            You will restructure you industrial machine as it will become unaffordable for the government to maintain handouts.

            I’m not stating all will end. That is impossible, but you will see a large shift.

            This will occur with many kicking a screaming, especially organised labour.

            The US will be the better for this up and coming change, that you Keynesians don’t want to believe will occur.

          • 0 avatar
            agenthex

            You don’t seem to understand the power of US hegemony. If things go badly, the american military can occupy Aus by the end of the week if need be. This would open access to plenty of additional resources (ie money from the ground) and fund the empire for another generation. It worked for England for centuries, no liberalization necessary.

          • 0 avatar
            agenthex

            And you know what the funniest part is: that idiotic healthcare system you’re mocking is the result of the american right wing; ie. your counterparts in the US. They’re the herp-a-derps making the same remarks about left-wing Keynesians/free market healthcare despite never reading anything, and they’re to the *right* of you.

            So now if you think real hard, you can see what the problem is from where I stand.

          • 0 avatar
            Big Al from Oz

            @agenthex
            You’ve made several mistakes debating me.

            1. You talk down to people. You can use all of the ‘econo speak’ you want. I can do the same with my profession. But I speak in layman’s terms.

            So this indicates you thought you were speaking to an audience. So did you want to debate me or think you are making me the fool.

            2. You are totally to the left. But you assume I’m a right winger. If you read my comment you will see I do support public health, a livable minimum wage and education. I’m in the centre.

            3. You under estimate your adversary and are a bully, just look at your ‘US can invade Australia’ comment. This indicates that my argument was indeed a shock to you.

            I may be correct that your teachings don’t support your paradigms.

            A great teacher and mentor you must be.

            Good night.

          • 0 avatar
            agenthex

            Are you for real? I haven’t used a single econ term and that was pretty blatant parody.

            To be fair, I sometimes ponder if indeed I have it all wrong, and that maybe I was actually the stupid one. Then I recall that Dunning Kruger paper, and all is well.

          • 0 avatar
            Pch101

            “Then I recall that Dunning Kruger paper, and all is well.”

            That’s what I was thinking. Too incompetent to recognize the level of his own incompetence.

            He’s the kind of guy who reads a partially accurate Wikipedia article, misunderstands 2/3rd’s of it, and then believes himself to be knowledgable. It’s pretty comical, but not funny enough to read once you’ve learned his half-dozen talking points.

      • 0 avatar
        Pch101

        I didn’t bother to read Al’s response, but it’s a foregone conclusion that he isn’t capable of grasping your point, which only proves how expendable and overpriced that he is. Dime a dozen.

    • 0 avatar
      JD321

      Well sure…If your idea of “full potential” is an obedient tax cow of the farmer state…Isn’t that what arianna wants for us all?

  • avatar
    doctor olds

    The next domino falls in the unsustainable Australian economic experiment. The social and economic impacts of this will be interesting. Our friends down under are in for the curse of “living in interesting times.”

    • 0 avatar
      RobertRyan

      “Curse of interesting times” I think you have really very little clue about Australia. This is not Detroit. The Australian car manufacturing down to less than 14% of all cars on the road. In 2009 the GFC and bailouts were propping up a more than 50% share of the market.Still we have the spectre of 2009 being repeated in the US.

      • 0 avatar
        doctor olds

        Of course you are not Detroit. It is the auto capital of the world! You are phasing out of the car manufacturing business altogether.

        We have had our own “interesting times” but our auto industry is very strong again due primarily to the UAW finally relieving the companies of the unsustainable costs of old.

        We are seeing 10′s of $Billions in auto investment here and the future looks bright indeed!

        • 0 avatar
          RobertRyan

          ” It is the auto capital of the world!” A Totally bankrupt entity very symbolic of the US Automobile industry.
          Sales slowing , profits dramatically slipping..another crash not far off.

          • 0 avatar
            doctor olds

            Detroit, the city, has problems. “Detroit”, US Auto Sector, is doing GREAT!

          • 0 avatar
            Hillman

            The suburban county (Oakland County) is the 4th wealthiest county in the United States with a population over 1 million people. Detroit the city bad but the region is fine.

          • 0 avatar
            RobertRyan

            “Detroit, the city, has problems. “Detroit”, US Auto Sector, is doing GREAT!”

            Not really. The Weather is not the main culprit.

            “These problems were compounded by weak auto industry sales last month, as bad weather kept potential car and truck buyers home. Now, GM is rolling out big discounts on some versions of the 2014 Chevy Silverado and 2014 GMC Sierra for its President’s Day sale: particularly for versions with V-6 engines. Investors have to hope these discounts don’t hit the bottom line too hard.

            Market share falls and inventory rises
            GM’s pickup sales trends have been very choppy in recent months, but January represented the company’s worst under-performance in terms of sales volume. Combined Chevy Silverado and GMC Sierra sales plunged 17%, while Ford’s F-Series sales fell just 1% and Ram pickup sales grew 22% year over year.

  • avatar
    agenthex

    For those with some interest in what’s actually going on instead of the typical political retardation, it’s very much worth reading this article: http://www.nytimes.com/2012/11/25/magazine/skills-dont-pay-the-bills.html?pagewanted=all&_r=1&amp;

    Put in the context of what I’ve stated in this thread, the implication is simply that the US/Au etc are *choosing* to subsidize harder to relocate service sector jobs with immigration policy at the expense of manufacturing jobs with industrial policy.

    To be fair, that’s a true compromise rather than political shell game, but given the choice between making actual stuff and having servants, in the longer term one appears to be a better proposition. Considering the rate computer technology is advancing, many “services” are likely going to be obsolete within a generation or two anyway whereas there’s always a job in servicing the machines.

    • 0 avatar
      Big Al from Oz

      @agenthex
      Sort of the line I’ve been discussing, but it’s how this transformation will occur.

      Well, I’ll be. Again this article points to the issue I’ve spoken off in the recent past with the transformation of the global economy.

      I really do think that you don’t need to be a mechanic to know when you hear a loud bang at the front of your car, open the hood and see a hole in the block that the engine is f#ucked. Or, when, after a tornado it rains and you living room floor is wet, you don’t need to be in building and construction to realise you don’t have a roof.

      Economics is the same, but yet you left wing idealist try and tell me that I don’t know. You left wing egalitarians think you always know better and we the ‘serfs’ as you treat us should heed your wisdom

      Well, as I’ve shown your wisdom is flawed.

      I do know this.
      1. The path you want us to follow with borrowings and debt to exist just can’t work.

      2. To compete and be successful at competing the competition must be on an equatable footing. This concept is no different to sport. But I bet with your views you agree that the US Olympian’s should be allowed steriods.

      3. The current policy that you support of protectionism and subsidisation will bring down the US economy. As I’ve stated how will you pay for health, social security, agri industry, manufacturing and on and on.

      I say this because it is quite apparent that if you look globally the economies with the advantage are the freer economies.

      The US and Australia have a slightly divergent approach for the up and coming economic changes.

      The significant difference is we are trying to reduce debt and this is achieved by making industry more competitive, not just within Australia but globally without the socialist handouts and protectionism.

      It seems to have worked for the past 30 years.

      Go back to school and learn commonsense before you tell me about your socialist values.

      • 0 avatar
        Big Al from Oz

        Oh, if you can’t surmise the word egalitarian is a mockery of you. Because you are so far removed from reality.

        I also think we should spot the US 25% on all sporting events. I think this new feature of sports/athletics should be given a poultry related term.

      • 0 avatar
        agenthex

        > Economics is the same, but yet you left wing idealist try and tell me that I don’t know.

        It’s not so much “what” you don’t know, but instead that understanding certain concepts required a baseline intellectual requisite. For example, no amount of explaining calculus is going to help someone who simply doesn’t get algebra. If your goal is understand the calculus here, it would be to your benefit to do the real work through alg i/ii, etc. However for the benefit of everyone else a few things are worth explaining:

        > The significant difference is we are trying to reduce debt and this is achieved by making industry more competitive, not just within Australia but globally without the socialist handouts and protectionism.

        To put gov debt in perspective, it’s simply the different between taxation and spending. When Big Al’s employer has to pay him $40k or whatever instead of $20k for Akbar who can’t get a work visa due to immigration law, that’s akin to taxing the boss $20k to put in Al’s pocket. Had the government not restricted Akbar’s work status and taxed boss-man anyway (note no diff in productivity nor money to boss), the government would’ve had $20k in its pocket to pay debt or hire strippers for everyone to stimulate the adult entertainment industry.

        In sum, the choice between government handout to Al vs strippers seems like an easy choice to make in terms of self-interest. Paying down the debt would prolly be my second choice.

        • 0 avatar
          Pch101

          You do realize that he’ll never understand this stuff, right?

          • 0 avatar
            Big Al from Oz

            @Pch101
            Coming from an engineering background I will never be able to comprehend illogical decision making.

            Try applying science and mathematics to your models.

            The US middle class is reducing, why?

            The Australian middle class has expanded, why?

            Look at why these events are occurring. Here’s a hint, it isn’t due to heavy borrowings and protectionism.

          • 0 avatar
            agenthex

            It’s bit of a guilty pleasure to write some of it, and hopefully at least someone else found bits of it funny (ah, leftist social handout).

            Anyway to close the loop, the point is that investing in r&d and manufacture of robot-strippers is likely the best long term strategy for that 20k.

          • 0 avatar
            agenthex

            > The US middle class is reducing, why? The Australian middle class has expanded, why?

            Uh, decimating these types of jobs explains the US (ie. less middle class jobs = less middle class jobs). As it would for Aus when the hit from these closures is reaped (less middle class job = ??).

            Frankly it’s pretty embarrassing when an engineer can’t grasp the most trivial of causality.

          • 0 avatar
            Pch101

            The guilty pleasure isn’t likely to last.

            The guy’s inability to comprehend even the simplest of points knows no bounds, while his hostility to anything that he doesn’t understand (i.e. virtually everything) quickly degrades into tedium. It’s a daily antipodean train wreck.

            “Frankly it’s pretty embarrassing when an engineer can’t grasp the most trivial of causality.”

            Is that what they’re calling shift workers these days?

          • 0 avatar
            RobertRyan

            @Pch101,
            “Train wreck” your lack of a suitable reply suggests Big Al from Oz has got you.
            Beat him on the argument, not on rhetoric.

          • 0 avatar
            agenthex

            > Beat him on the argument, not on rhetoric.

            The problem is that Big Al doesn’t have what we normally consider an “argument”. An argument derives from reasoning with facts. When people lack those that abilities, what they often do is take someone else’s argument (and many are on offer from your favorite political office) instead. The words look the same, but foundation they’re built upon is missing.

            If you still can’t tell the difference, consider trying harder because this is a key concept to grasp about arguments.

            Also, from another one of your comments, “agreement” isn’t what anyone is looking for; fact-finding and reasoning isn’t a matter of democracy.

          • 0 avatar
            Big Al from Oz

            @agenthex
            Your problem is you can’t find an answer to counter me.

            This leads me to believe that you don’t have an argument to support your beliefs.

            Your beliefs appear to be subjective waffle. You only have ‘put downs’. Very professional I might add ;)

            Start providing some credibility to the discussion.

          • 0 avatar
            agenthex

            > Your problem is you can’t find an answer to counter me.

            Nothing can counter a moron with enough self-conviction.

          • 0 avatar
            mr_min

            Big Al, I severely doubt your a Bachelor of Engineer graduate.
            I’ve been following the debate, and you continue to hide behind theoretical economic rhetoric, with limited understand of the ground level impacts.

            The issue I’ve have with your argument is that the economy will better off without automotive subsidies/co-investments/whatevers. But you never qualify how… I’m beginning think your a Abbott internet robot.

            I have two points.
            1. Its not an equal playing field. Never has and never will be, whether it be Automotive, Agriculture, Mining, Service etc. The main countries all play the game and that includes Japan, China, USA, Europe and Gasp even Thailand. Its just a fact of life, and we can debate it till the cows come home. But it doesn’t change the point of the article and my second point.

            2. Large scale jobs don’t magically appear, especially not low income, low education level. There has been numerous articles about low paid workers in dying sectors and how they struggle to be re-employed in Australia. This is a large geographically isolated country with a smallish internal economy.

          • 0 avatar
            Big Al from Oz

            @mr_min
            Very nice to meet you too. What an introduction! Out for a s’troll. It appears I’ve come across that dreadful Australian syndrome called ‘tall poppy’.

            As for my politics, I think the two most influential politicians who made pivotal changes to our country are Keating and Costello. So, that sort of screws up your theory of me. Your belief of myself being a right wing conservative.

            If you have been following my scribes on this site you’ll see I despise Fox News and MSNBC. This should give you an idea on where I stand politically.

            This would also indicate that your views on my credentials and my professionalism could be highly questionable. Like I stated your potentially out for a troll.

            Judging by your great intro, I don’t think it would matter what I stated about my views on how to improve the Australian economy. Read my discussion below with agenthex and decide what course of action you would take to achieve my beliefs. You attempted to come across as clever enough to do that.

            I think you’ve already made an predetermined assessment of my position judging by your fantastic introduction.

            Should I expend effort for you?

          • 0 avatar
            agenthex

            > But you never qualify how… I’m beginning think your a Abbott internet robot.

            Big Al is what you might call a shitposter. For example, right after claiming engineering background comes this: “Try applying science and mathematics to your models.” This from someone who’s never shown any semblance of science or math ability.

            His whole schtick is to stake some belief he saw elsewhere, and keep throwing feces as long as it gets attention. He’ll never post a relevant reply or address any specifics, and that’s fine with him because there was never any intent to engage constructively in the first place.

          • 0 avatar
            LALoser

            Agenthex and Mr_Min: It is true in most of the world the title “engineer” is used by what we call technicians or mechanics. Big Al stated on a past thread he was working the flight line. The major possibilities are: A&P mechanic, avionics tech, or baggage handler. Someone in ground ops management would not refer to themselves as an engineer, besides, his previous statements lead one to think he is not IT. Now, he does seem know AL, structures, stress, etc. So my bet he is what we would refer to as an A&P mechanic. Besides, if he held a ME, SE, PE, stamp etc, I’m thinking that would have been stated.

          • 0 avatar
            Big Al from Oz

            @LALosr
            Better read that thread again and actually read what I was doing.

            You obviously don’t have very much a clue then on flightline operations work.

            Believe it or not much maintenance is performed on line.

            Hmmmmmm??

            Is omission, trolling?? Wake up to yourself.

          • 0 avatar
            LALoser

            No Big Al. I don’t troll, sidestep, or pretend to be someone I’m not.

          • 0 avatar
            Big Al from Oz

            @LALoser
            What does an engineer do?

            Do you think all engineers sit behind a desk in design?

            Do you think engineers are those dorky people with thick glasses?

            Judging by your comment you don’t have much of a clue about what goes on in aviation maintenance and another area that might surprise you is management that engineers are involved in.

            Believe it or not aircraft are highly technical and technical managers are required to make decisions. Oh my, I never considered that you will say to yourself.

            You wouldn’t be able to guess what aircraft type I work on. Baggage handling??

            Do you know what risk, analysis is? Safety?

            Aircraft aren’t motor vehicles, aviation maintenance is much different.

            Do you know what aviation engineering jobs are available?

            The coal face on line does require engineers.

            So who makes the decisions of ‘go or no go’ for an aircraft to fly?

            A baggage handler, the pilot???

            So, stop with your trolling. Listen and learn.

          • 0 avatar
            Big Al from Oz

            @LALoser
            I’ll teach you something about engineering that you’d probably never even considered.

            Here are some words for you to define, use a dictionary.

            Conformance, compliance, certification, authority, deviation and most importantly engineering.

            My job is actually the interface between ensuring compliance and what the regulatory requirements are.

            I inspect and certify work, on top of manageing a team of technicians and all of flightline when rostered on.

            This job has given me the opportunity to travel around the world.

            I’d recommend this job to anyone.

            So, you can see by the area of work I’m leads to my interest in the motor industry’s regulatory decisions and outcomes across the globe.

            That’s why I make a mockery of some of the comments from the likes of Pch101, who’s clueless when it comes to any regulatory framework.

            It’s just in aviation the controls and regulations are more uniform globally.

            Maybe the auto industry should adopt the aviation model.

            So, it appears like I’ve always stated the differences in regulations, whether emissions or design are trade barriers.

            This is proven by the work and industry I’m in.

          • 0 avatar
            LALoser

            Big Al: Just so happens, my father-in-law is an aeronautical engineer from AU in Pampanga. He has worked in several FBOs and a limited background in manufacturing.
            My father was a civil engineer. My sister is an electrical engineer. Me, I have a good idea regarding FBOs from my military experience.
            Now I see quite the list you put forth; but it is a list. No where did you state this is what *you* do. (that is from a previous comment of yours, sorry. I have a seven year demanding attention).
            That aside, I really liked my time working in NZ and OZ. The Snowy River project was an amazing piece of work. It is hard to imagine them doing that. Another cool thing was a fire clock in Melbourne.
            Then went to Blacktown and set up an autoclave the size of a large submarine.

          • 0 avatar
            Big Al from Oz

            @LALoser
            Well, this is the net. Also, my grandfather worked on the Brookhaven Lab on Long Island. That doesn’t make me a mathematician or physicist.

            I’ve proven all I need. Read up and learn about what engineers do and what’s available to them as careers. You’ll be surprised at the diversity of work available.

            It’s like me passing judgement that DocOlds isn’t an engineer. He has never put forward any evidence such as I have to support his claim. Or even Pch101, what is his input other than trolling.

            These guys have tried to discredit me. So let’s see them put forward an argument to support who they are.

            Judging by some of their comments I would think DocOlds was a GM line worker and Pch101 a UAW shop steward.

            Maybe your targeting of me is more of a troll than a real interest.

            As you can see I have given you a considerable amount of information to digest.

            I also think if you read my last blog in this thread, you’ll see why I have the interests I do in the auto industry.

            Sorry, but I can’t really provide much more than this.

          • 0 avatar
            agenthex

            > It is true in most of the world the title “engineer” is used by what we call technicians or mechanics.

            As you alluded to, people of a given background build arguments with recognizable patterns. Al doesn’t do anything characteristic of those with a STEM education so I surmised as much.

          • 0 avatar
            doctor olds

            Well, Al, since you called me out, I will be happy to share my credentials and career experience.
            In 1969, I was sponsored by the Oldsmobile Division at General Motors Institute where I earned a Bachelor of Science in Mechanical Engineering with an Automotive option. I graduated the 5 year program as the Arab Oil embargo was underway in 1974 causing GM to reduce staff and shuttling me off to the Sales staff where I spent 7 years in the Field Sales/Service organization as a District Service Manager for Olds. From there I moved to the Olds Technical assistance staff where my responsibility was to help dealer technicians solve difficult product problems for three years. from there I moved to the BOC Group HQ Electronic Service Engineering with responsibility for Service diagnostics for engine controls and Toronado Body Computer. Included in the job was a role in the committee which provided ECM data stream information to aftermarket tool makers and the service voice for advanced electronic systems development. From there, I moved to BOC-Lansing Powertrain Product Engineering Product Assurance where my responsibilities included Emissions and Safety compliance, interfacing with government agencies for all regulatory issues and information requests. I also had responsibility for our powertrain product quality and any assembly plant issues at 5 vehicle assembly plants. Along the way, I was part of the group who designed GM’s business system to comply with California’s tough emission defect reporting law and was “the suit” across the table from the regulators on occasion.
            When GM Powertrain was consolidated in Pontiac, Michigan, I moved to a staff function with responsibility to investigate product issues, formulate response plans and lead teams to develop responses as necessary, then interface with Senior leadership including some of Rick Wagoner’s direct reports. I spent a time in a tiny group doing a deep dive into why quality problems occurred in GM and helping to find systems to assure against them.
            I retired in 2008 from that role. My career took me from the dealer sales floor to the service department to the plant floor to the executive suite. I am blessed with a pretty good memory for details, and participated in every quarterly business review for several decades. On top of that, I love cars and business and have been paying attention for a very long time.
            What’s your story, in detail?

          • 0 avatar
            Big Al from Oz

            @agenthex
            Again you are proven incorrect.

            And, again, you are attacking me?

            I think it has more to do with you can’t accept being proven incorrect.

            You are one arrogant person.

            My ideals are what you don’t like, not my PROFESSION.

            So, why not attack a person professionally when proven wrong.

            Especially if you can’t prove yourself correct or support your arguments/beliefs.

            I’m considering not debating you, as you appear not to handle failure to well.

            Are you part of the ‘ME’ generation. You know the ones who go through school and never are told they are a failure?

            Face it, you’ve come out second best here. Second place is first place amongst losers.

            Try and develop and mature. That’s the best advice I can give you.

          • 0 avatar
            LALoser

            Doc Olds has been there and done that. You must share experiences as you see fit.

          • 0 avatar
            Big Al from Oz

            @DocOlds
            Thanks for your history. I do appreciate your acknowledgement.

            As you can see my interest in the automotive world is linked directly to the world I subsist in.

            I’m a strong supporter of global standardisation. This would reduce costs considerably to the consumer.

          • 0 avatar
            agenthex

            > And, again, you are attacking me?

            You’ve only brought this torrent of ridicule from everyone on yourself. They can all see your comments bring nothing of value and only pollute the landscape. Deluding yourself otherwise doesn’t change what others think of you.

          • 0 avatar
            Big Al from Oz

            @agenthex
            Everyone? Get real.

            I really don’t have anything to prove to anyone, especially you.

            I’ve expressed my views, which counter yours and you go into personal attacks.

            I must ask myself why the unusual behaviour? Sorry, mate, you are just another goose.

            I’m sorry if you can’t handle failure.

            Learn how to accept, learn tolerance.

            Remember this is a blog site. People like you exist even in my ENGINEERING world.

            You guys are normally relegated into a corner and never achieve.

            All noise with little performance.

          • 0 avatar
            agenthex

            Really it doesn’t matter what anyone says, the completely deluded will just believe what they want. They really are the worst possible participants in any kind of social forum.

  • avatar
    Big Al from Oz

    This link is probably closer to the truth than most other articles.

    Australian parts suppliers don’t supply as much as they want to public to think. They are only after money.

    But, as this article points out the cost of maintaining the auto industry in Australia was just to expensive. Other countries will soon come to this conclusion and the general population will realise this to, like what occurred here.

    The government wouldn’t have removed subsidisation if the populace didn’t support it.

    As I’ve stated, why support failing industries. Make them truly competitive.

    http://www.news.com.au/finance/business/why-australias-car-manufacturers-toyota-holden-and-ford-all-conked-out/story-fnkgdhrc-1226827493012

  • avatar
    Big Al from Oz

    @agenthex & Pch101
    Your only defence is Big Al just doesn’t understand. It’s a very poor defence on your part. I really feel let down, I thought I was debating an economist.

    Trying to belittle and bully, the tactic like all organised labour organisations use.

    Here’s what I understand.

    1. The countries that are failing economically don’t have the flexibility to adjust to the new globalised world, ie, restrictive work place relations, an incredibly complex system of tariffs, technical barriers, etc. Why? To protect inflexibility which equates to uncompetitiveness. Look at the Italian’s with their restrictive work place regulations and tariffs/subsidised workforce.

    2. How flexible is organised labour? It has very restrictive work practices. Why? So the unionised institution can maintain control.

    3. So your beliefs aren’t necessarily for the good of the people or nation, it’s about power to protect your institutionised paradigms. How do you protect this fantasy? By creating a protective and subsidised environment. An unsustainable artifical world to compete in.

    4. This can be shown by gauging the success of liberised economies vs economies with less flexibility.

    So, as you can see it’s quite simple. The Australian economy is better of because we are more flexible. We can change and adapt quicker making us more competitive.

    Your left wing inflexible paradigms is what’s destroying the very people you claim to protect.

    That’s why your middle class is declining. You must produce a profit and not debt.

    So, the countries that can change and adapt quicker are more likely to survive.

    Sounds almost like evolution.

    So my guru economist agenthex, go and teach your students and hopefully they will challenge you, for being so naive and foolish.

    • 0 avatar
      agenthex

      > Here’s what I understand.

      The problem is that all you “understand” is parroting the same few talking points; that is fundamentally different than “understanding” and it’s also a job which will soon be replaced by robot-parrots. Recollect engineering involves thinking, not repeating.

      The simply example above trivially illustrates that much of the national debt come from subsidizing (white collar) jobs into the middle class. Unfortunately without such a heavy subsidy there would be no middle class, but sure a lot of money left over, which rather explains the increasing US econ inequalities. Recall we’re more right wing than you (eg at-will employment, etc), not less.

      Alas this will continue to escape you. I have hope yet for the US if this exemplifies the product of Aus eng school.

      • 0 avatar
        Big Al from Oz

        @agenthex
        You still can’t believe your incorrect??

        I did show that your teachings don’t reflect your deeply rooted paradigms.

        I do have some empathy for you.

        It’s all to confusing for you to accept that you may be wrong.

        • 0 avatar
          agenthex

          > I did show that your teachings don’t reflect your deeply rooted paradigms.

          Parroting a few talking points only shows that the parrot is of rather simple construction. Creating an argument OTOH requires critical thinking skills.

          > Whatever he is, I’m pretty certain that he isn’t an engineer.

          Given how the conversation’s gone:

          A: 2+2=22
          B: You should check that addition chart
          A: 2+2=22! ha ha, I win!

          Any engineer background is irrelevant anyway if that is the result.

          • 0 avatar
            Pch101

            Check out this exchange beginning with this comment: http://www.thetruthaboutcars.com/2013/10/capsule-review-ram-1500-diesel/#comment-2239545

            He obviously had no clue at all that regulations governing fuel economy standards vs. CO2 standards are essentially doing the same thing. I would expect an engineer to understand something as basic as the relationship between carbon emissions and burning fuel.

            He also doesn’t understand that greenhouse gas emission regulations and smog pollution controls aren’t the same. Again, I would expect an engineer to know the difference between reducing carbon emissions and controls on pollutants such as NOx.

          • 0 avatar
            Big Al from Oz

            @agenthex
            You can try and belittle. I just don’t buy it.

            Because if you have to resort to that type of behaviour proves you don’t have a sufficient response to challenge me. Just like your “America will come down and take Australia’s resources”.

            You live in the past. You are trying to maintain the past at the cost of a nation.

            You must modernise and evolve. There’s that word again EVOLVE. But, this must include flexibilty, another word that scares organised labour.

            Words like flexibilty, productivity you will challenge.

            I do understand much better than you considered or you wouldn’t still be challenging me.

            Good day.

          • 0 avatar
            agenthex

            > He obviously had no clue at all that regulations governing fuel economy standards vs. CO2 standards are essentially doing the same thing.

            What I’ve generally observed is a certain segment of the population simply don’t understand how “reasoning” works. Solid reasoning requires a surprising number of requisite faculties which isn’t immediately obvious to those for whom it comes naturally, concepts such as facts, and how they relate.

            Our friend here seems to grasp such a thing as facts, which is a step up from some above, but not that they relate flexibly. For someone like that a science book would be merely a collection of facts to be memorized by rote. The relations are also just facts. It’s like the guy who did his math by dropping fixed things in the equation and hoping for the best. That works up to a level, but obviously not a degree which requires conceptualization. In the US it’s a “technician” role: someone who can manage to remember a bunch of technical facts.

            Because that’s what he can do, he believes that’s what everyone else does, cue Dunning Kruger. A “debate” is just a battle between one memorized fact vs another. In your specific case he didn’t remember that relational fact from school or whatever, and didn’t want to believe you as a source out of contempt.

            It also explains why he can’t develop new econ “facts” from the few he has. “Freedom good”, “Leftist bad”, etc. Talking points void of reasoning are in a way designed for this sort of crowd.

            So you are correct that it’s a pointless endeavor, because understanding what’s being said here requires reasoning, and so many non-trivial component parts are missing.

          • 0 avatar
            Pch101

            “Our friend here seems to grasp such a thing as facts”

            He doesn’t cope well with those, given his penchant for misinterpretation.

            And he’s driven largely by anti-Americanism, which takes him to some odd places. That’s not exactly uncommon among Aussies, but he’s extended it into subject matters where they don’t usually go. Give Wikipedia to a half-literate bogan, and this is what happens.

          • 0 avatar
            agenthex

            > He doesn’t cope well with those, given his penchant for misinterpretation.

            It’s key to make the distinction between someone’s ability and how they choose to act. Many might choose to sh1tpost, but that doesn’t explain why only some make the sort of categorical errors that you pointed to. This also sets up the differences in motivation; whereas we call those with more malicious meas rea trolls, others operate for different reasons.

            Consider that an idiot can never lose an argument in their own mind as long as they remain too clueless for what’s going on to effect them. This perpetuating process operates out of self-preservation, given they have little to lose and everything to gain. To wit, acknowledging oneself to be dumb when intellect matters only leads to despair, but by following the delusion instead they can be peers of any expert and always be right regardless.

            Contrast this with trolls who don’t use self-delusion but some degree of calculus to choose and even *construct* disingenuous arguments.

            In perspective, honest dialog relies on following certain rules of engagement, and there are many ways to break the unwritten rules.

          • 0 avatar
            Pch101

            He’s just overcompensating for his feelings of inadequacy. Not really worth the bother, as he can’t be fixed.

      • 0 avatar
        Pch101

        Whatever he is, I’m pretty certain that he isn’t an engineer.

        There’s basic stuff about emissions and other matters that an engineer would easily understand, but that he clearly doesn’t grasp at all. If he’s claiming to be an engineer, then I would say that he’s lying.

  • avatar
    doctor olds

    The term “Engineer” seems to be used loosely in OZ, not necessarily a rigorous 4 year college program graduate.

  • avatar
    doctor olds

    Just sharing experience with Aussie friends who call themselves “engineers” but do not have the education that actually requires. ;-)

    It is just an observation, not a comeback.

    • 0 avatar
      Big Al from Oz

      @DocOlds
      You guys can only come up with professional putdowns? The describe it a an observation?

      Really, talk about poor form. I suppose in all fairness I couldn’t have expected anything else.

      As I stated before I do have empathy for your lot.

      • 0 avatar
        doctor olds

        It is an observation, nothing more. In Germany, they use the label “Doctor” for educational levels more like a masters degree in engineering in the US, as an example of variation between countries and labels.

        I can’t disagree with PCH questioning what “engineer” means in your case based on your comments.

      • 0 avatar
        agenthex

        > You guys can only come up with professional putdowns? The describe it a an observation?

        It’s actually worse than this. Generally when a technician is exposed to engineering activities they’re supposed to at least grasp the difference in the roles. A categorical denial would imply limited exposure to engineering.


        I’m not a teacher, but that profession is aware and sensitive to the building blocks required when developing pedagogy material. If you’ve ever wondered why math becomes less mechanical and more conceptual as it advances, instead of starting with key concepts and adding the mechanics later, it’s to cater to the lowest common denominator.

        • 0 avatar
          Big Al from Oz

          @agenthex
          My intrepretation is you are disillusioned.

          It appears you do have a conflict within.

          You haven’t proven much.

          Except you consider yourself above and beyond others.

          What a pitiful life you must lead.

          • 0 avatar
            RobertRyan

            “We’ll invade Australia and take your resources”

            Are we talking about the Australian car industry or the US becoming a dictatorship?

            getting a bit off the topic.

        • 0 avatar
          Big Al from Oz

          @agenthex
          Like I stated I have empathy for your deeply rooted problems.

          Why? It’s called an inferiority complex, similar to an American Exceptionalist attitude.

          Admit it, you just are incorrect about the world. This just can’t be true.

          • 0 avatar
            agenthex

            > Just like your “America will come down and take Australia’s resources”.

            One last point; this isn’t first time I’ve remarked it’s the parable of the british empire as retold with shuffled characters. A fellow colonist should surely recognize, or not as the case is here.

          • 0 avatar
            Big Al from Oz

            @agenthex
            The irony of all this is I’m flexible enough to accept some ‘left wing’ ideals, like public health, realistic minimum wage, etc.

            You have gained nothing by debating me other than having other ideas overshadow your beliefs.

            Oh, and I’m also an American, but without your pathetic arrogance.

          • 0 avatar
            agenthex

            A last protip: don’t pretend to be something you’re not when there are people around who can tell the difference. It’s embarrassing for everyone involved not least of all yourself.

            Also, a professional implies competency at something, and there’s an objective difference to incompetency. It’s not just arrogance to state that some people can’t perform reasoning; that’s just the reality, a fact if you will.

          • 0 avatar
            Big Al from Oz

            @agenthex
            People around me who can tell the difference?

            And you are calling me unprofessional?

            Wow, agenthex, just look at your behaviour in this episode.

            I really do think you are full of $hit.

            You obviously don’t know me :)

            Unprofessional ;)

          • 0 avatar
            Big Al from Oz

            @agenthex
            Do you really know what a professional is?

            Trolling like you are isn’t a profession. Or your sham economic credibility. Tennessee don’t want you.

            Unionism or politics isn’t a professional.

            A profession means you live and work by a code of ethics. This means you are part of an association of people who uphold the values you have.

            I will surprise you.

            From what I’ve seen you don’t have the capacity or even the potential to be a professional.

            I’ll just go back to ‘We’ll invade Australia and take your resources’.

            Or your economic credentials.

            I hope if you instruct, facilitate, teach, and mentor your performance is much better than you have displayed here.

  • avatar
    Athos Nobile

    Chaps, I think you all should read the link below, specially the Aussie team.

    http://www.abc.net.au/news/2014-02-11/llewellyn-smith-australian-disease-enters-its-terminal-phase/5251418

    There are 2 charts and 1 number in that article that are chilling.

    • 0 avatar
      doctor olds

      I am an old man (relatively, at least!) and have been keenly interested in economics, politics and the auto industry for nearly half a century. Hell, I am such a nerd, I was into data about the car industry over 50 years ago at 8-9 years of age! Still remember the pride in my state producing most of the world’s cars in ’59 or so! “What a long strange trip it’s been!”

      Along the way, I witnessed the long term impact of the UAW monopoly on the American Auto sector, the entitlements and generous contracts leading inevitably to the financial depletion which caused 2/3 of the business to fall into bankruptcy with the economic crisis in ’08. These generous provisions and entitlements provide a microcosmic example of what social welfare democracies, many US cities and some states are facing. It is obvious with the benefit of long term observation though political voices make it very hard to see what is real.

      What is chilling to me, is the ignorance of so many who seem to think “history” is over, not still being written. We are not immune from failure just because we have been successful for a long time- more than the lifetime of most who comment here, including me!

      I love Oz, thoroughly enjoyed the many Aussies I’ve met and travelled with, but have had a nagging question as to how they are able to spend so much on wages and social welfare benefits given their myriad economic disadvantages in the context of competition with the world, and still have a good standard of living.

      The link you provided is chilling, and I am sorry to say, rings true.

      • 0 avatar
        agenthex

        You seem to forget that Detroit also built a lot of questionably engineered cars. The UAW can conceivably be argued to contribute to the build at times, but not to the engineering. Place any 80/90′s corolla or such next to domestic counterparts and it’s obvious the problem isn’t someone didn’t screw down a panel right.

        From the retelling of your experience you should be aware what percentage of costs can be attributed to labor per se, and it just doesn’t add up to the narrative that the lazy american blue collar worker’s cut of the pie was responsible for the failure at every level in Detroit.

        In politics that’s a called a scapegoat: someone else to pin the blame on so you don’t take any yourself.

        • 0 avatar
          doctor olds

          The facts are clear: GM alone bore a cost of $8Billion a year just for UAW Retiree health care and to pay people for whom there was no longer any work. A normally functioning enterprise can deal with lost revenue and market share by reducing labor costs. The simple fact is that UAW contracts created an albatross whereby one could come to work for an automaker out of high school at 18, retire at 48 with very good health coverage for you and you family for the rest of your lives. GM was providing coverage for 1.5 million people. Labor costs rose inexorably despite reduced market share due to several reasons, excellent global competitors and of course management error. The inability to control labor costs drove lots of dysfunction- running plants to get something out of workers who were going to be paid anyway and discounting to move the iron hurt the brands, and shortage of Product Development funds was another hugely harmful side effect. I am glad to pile on some of the MBAs in management for plenty of bad decisions that added to the problem, but still contend that, in itself could have been survived if only labor costs could have been brought in line with volumes.

          I never knock the UAW workers. I worked with lots of sharp, conscientious hourly workers, most of who just wanted a fair wage for a fair days work. They were “willing workers doing their best” as Dr. Deming said.

          On the other hand, the financial burdens on the US makers imposed by the UAW with it’s monopoly on them left them all in pretty much the same boat in 2008; so financially depleted that the financial crisis induced credit freeze and market collapse pushed 2/3 of them into bankruptcy. Ford’s saving grace was a massive credit line procured before the freeze. Otherwise they would have gone bankrupt, too. The big difference in Ford’s profitability today is the same factor that enables GM and Chrysler to be profitable – the ’07 UAW contract which lifted the massive retiree health care and job banks costs from all the US makers. Their labor costs went from $73 to $48 as a result, making them competitive with the transplants in that regard now.
          No scapegoats, just real world reasons.

          • 0 avatar
            agenthex

            Again, it’s simply poor form for someone working on them to ignore the obvious fact that the cars were terrible. Car companies compete first and foremost to sell cars, and making bad cars has consequences.

            Similarly you might notice that their cars are no longer nearly as terrible; making stuff people actually want to buy might have something to do with a potential turn-around.

            Last I check the UAW’s only responsible for the folks turning the screw at the end of the process, so circling this whole narrative around them instead of the whole entire chain of people responsible for a good product seems quite specious.

            IOW, you argument is basically: I might’ve done a craptastic job but they did even worse so it’s on them. Even that’s not exactly convincing given every other car maker around the world is unionized and seemed to do just fine.

            >The simple fact is that UAW contracts created an albatross whereby one could come to work for an automaker out of high school at 18, retire at 48

            OTOH it seems that by not giving yourself union representation for collective bargaining that you got a bad deal. Seems bit of a bad mentality to make sure everyone else gets a bad deal, too.

          • 0 avatar
            Pch101

            In the real world, General Motors failed utterly and completely, and exists today only because of tens of billions of dollars in government funding, and because the current adminstration had the good sense to hire a guy out of private equity to reorganize it and strip a lot of the fat out of it.

          • 0 avatar
            agenthex

            It’s as much the fat as the wake up call to stop building crap. Bumbling bureaucracies aren’t just bad because of too many people but the output is mediocre or worse.

          • 0 avatar
            Pch101

            GM did build lousy cars, of course, but that fed a spiral effect that created a whole host of other problems.

            As time went on, consumers began to realize that GM cars were not particularly good.

            That led to reduced demand, which reduced market share.

            That, in turn, led to price reductions as GM struggled to move excess inventories.

            Meanwhile, the massive intrastructure that had been created to support a company with 50% of the US market became a burden as that share and per-unit revenues fell.

            The hubris that came from the earlier period of success kept the new crop of managers (many of whom weren’t even around when the company was at its peak) from addressing any of these problems. As far as they were concerned, it was everyone else’s fault.

            At least Steven Rattner realized that GM had to be resized in order to live in a world in which it had a lot less market share. No point in spending the money to build four versions of the same second-rate car when one or two better cars will do.

          • 0 avatar
            doctor olds

            My argument is simple no business can sustain ever rising labor costs in the face of declining or flat sales. All the rest is fairly irrelevant, but you boys have no greater understanding than the folks you criticize.

            PCH- GM presented the plan to the government man, not vice versa. Of course you don’t want to know that because it punctures your balloon of imagined understanding.

            One thing that is clear, you have virtually no understanding of vehicle development and apparently don’t think $8/billion every year in unproductive cost is a big deal, while $10billion one time loss on Treasury’s stock sale is huge.
            The facts that really make your comment nonsensical is the very same engineers you decry as incompetent are producing the highest quality cars in the world today. Ignorance and presumption- you guys have no place to criticize anyone!

          • 0 avatar
            agenthex

            >All the rest is fairly irrelevant, but you boys have no greater understanding than the folks you criticize.

            I would hardly consider making terrible cars in a business of making cars irrelevant.

            The reality is that GM had every conceivable advantage over the competition: home field, scale, technologically advanced industrial base, etc.

            The reality is that GM threw away the game to teams that most customers didn’t even like very much. Not the UAW, not the guys screwing down the panel, but the people who made all the decisions that went into a crap product that not even your countrymen (quite loyal I might add) wanted to buy anymore.

            > One thing that is clear, you have virtually no understanding of vehicle development and apparently don’t think $8/billion every year in unproductive cost is a big deal, while $10billion one time loss on Treasury’s stock sale is huge.

            Ah yes, those “overpaid” folks. I’m guessing you believe in “free market capitalism” whose main rule is “get what you can”, and those folks sure got what they could. But now you cry foul because their work isn’t worth what was paid (presumably compared to yourself) which is quite heretical to the basic philosophy. You can consider a lot of work isn’t worth what’s spent on it, but not while espousing an ideal that *by definition* equates the two.

            I note this because it’s the main reason why your arguments are logically inconsistent. It can be fixed by sticking to one ideal instead of picking and choosing as convenience dictates.

          • 0 avatar
            Pch101

            ” GM presented the plan to the government man, not vice versa.”

            I don’t really see why you indulge in this revisionist history of yours, when we’ve already gone through it and I’ve shown it to be wrong.

            This is the plan that GM submitted to the US Senate in December 2008, before Obama was in office and before the task force had been formed: online.wsj.com/public/resources/documents/gm_restructuring_plan120208.pdf

            It bears almost zero resemblance to what ultimately happened. This plan was rejected, almost utterly and completely. If Rick Wagoner had his way, Hummer would have been the only brand that would have been shuttered.

          • 0 avatar
            RobertRyan

            @Pch101, Out of the Mouth of Babes, you cannot hide the truth, but others will post to say it never happened.
            “In the real world, General Motors failed utterly and completely, and exists today only because of tens of billions of dollars in government funding, and because the current adminstration had the good sense to hire a guy out of private equity to reorganize it and strip a lot of the fat out of it.”

          • 0 avatar
            doctor olds

            This is the real story. The Obama Task force adding value is just as real as the statement, “If you like your plan you can keep your plan.

            The difference between us is that I know the business and what happened because I lived it. You just read about it and maintain opinions based on a brief stint in a GM field office years ago.

            http://www.forbes.com/sites/danbigman/2013/10/30/how-general-motors-was-really-saved-the-untold-true-story-of-the-most-important-bankruptcy-in-u-s-history/

          • 0 avatar
            Pch101

            You really ought to know better than to try to dispute my point.

            I just provided you with a link to the original GM turnaround plan that was submitted to the feds. It has a date on it, which is prior to the current president taking office and the formation of the task force.

            You can compare that plan to what actually happened. Notice how virtually none of what is in that plan became part of the actual plan.

            GM’s plan called for cutting one brand. The task force led them to cut four, not just one.

            GM’s plan called for Rick Wagoner leading it. The task force pushed him out.

            GM’s plan had no provisions for right-sizing the dealer network. The task force plan caused dealerships to be shuttered.

            I hope that you’re noticing a pattern here. If you think that this deal got put together in the fashion that GM wanted it, then you are utterly deluded. Read the plan, and see for yourself how little of it came to pass.

          • 0 avatar
            doctor olds

            @PCH- I have no problem disputing your ideas. You are simply misinformed and wrong. Can’t you read? The link I gave you provides the story and there ain’t no white knight from Washington who rode in to save the day.
            No problem disputing you at all even though you are a legend in your own mind.
            You just don’t know what you are talking about and refuse to learn.

          • 0 avatar
            Pch101

            I just provided you with a copy of GM’s turnaround plan.

            You can compare it to the final plan, and notice for yourself that they bear no resemblance to each other.

            Unless you think that I’ve fabricated the plan and convinced the Wall Street Journal to archive a fake document, you really have no rebuttal.

            Read GM’s plan for yourself. (Prepare yourself for the embarrassment of what a poor plan it is.)

          • 0 avatar
            doctor olds

            I know that GM’s initial plan was rejected and that it was an iterative process. I know that the final iteration came after GM planned to spare Pontiac, which would have been a good idea, and were told to cut another brand. Did you read the link I provided? It details where the plans came from and they didn’t come from Ratner.

            All he and his team did was send GM people away until they came with a plan he approved. You seem to think he and the government people added some value other than to say “no,no,no.” They did not, and as I have pointed out in the past, it is clearly unknowable whether GM’s plan would have worked or not. Since you don’t understand the decline and fall of the company, you undoubtedly can’t understand what happened next.

          • 0 avatar
            Pch101

            All of the changes came about because the government rejected the earlier iterations.

            If GM had its way, very little would have been done to change the status quo. Wagoner would have had a job, there would still be a multitude of brands, and the sprawl that was inherent to the company’s demise would have remained intact.

            The GM lifers don’t seem to understand the concept of right-sizing. GM is a prime example of what goes wrong when diseconomies of scale become a problem.

          • 0 avatar
            doctor olds

            Since you don’t understand what happened and why, you can’t understand why Wagoner was supported by the Board of Directors.
            Since you can’t seem to understand that $8B a year would be a huge sum for any carmaker to absorb, but think it a massive cost to taxpayers and can’t seem to grasp that Wagoner negotiated the ’07 contract that relieved that cost, you can’t understand. You are free with opinion, but lack profound understanding, preferring simplistic ideas. In line with an accountants mind, I suppose. The reality is a bit more complex than you seem to be able to grasp.

          • 0 avatar
            agenthex

            > Since you can’t seem to understand that $8B a year would be a huge sum for any carmaker to absorb,

            That might not seem fair to those who got a worse deal, but on the whole it balances out for GM at least against the savings from underpaying those too stupid to bargain collectively themselves.

            From my perspective it seems pretty clear from your arguments that the inside management was too busy blaming the unions instead of working hard to make cars worth buying. To this today it continues to escape many that even if the Japanese had to build their cars at UAW pay rates they still would’ve won.

          • 0 avatar
            28-Cars-Later

            Interesting link, thx Pch101.

            “Importantly, 22 of 24 new vehicle introductions in 2009-2012 will be cars and crossovers. Twenty of these models will come from GM engineering centers having a long history of designing vehicles for $6-$8 per gallon gasoline.”

            I found this bit of text from the document interesting but slightly ambiguous. Either it means in 2008 GM was developing product which could in theory cope with $6-8/gal gasoline or they are claiming they have designed product in the past which could cope with those prices (which I find to be not accurate).

          • 0 avatar
            Pch101

            “Either it means in 2008 GM was developing product which could in theory cope with $6-8/gal gasoline or they are claiming they have designed product in the past which could cope with those prices (which I find to be not accurate).”

            Putting things into historical context, GM’s pitch for money consisted of “lend us a bunch of money, and we’ll build all of these fantastic fuel-efficient cars such as the Volt. Oh, and while we’re at it, we won’t make any more Hummers.”

            That proposal didn’t fly. The subsequent iterations came as the result of the government rejecting the plans and turning the screws.

            Our good doc doesn’t want to admit to any of this, as he wants to give the credit to his former bosses, rather than to the government that he dislikes, for the reforms that allowed GM to reorganize. The whole process makes it obvious that much of what he learned as a GM lifer was wrong.

          • 0 avatar
            Pch101

            “From my perspective it seems pretty clear from your arguments that the inside management was too busy blaming the unions instead of working hard to make cars worth buying.”

            With GM, bad cars are always something in the past, if they ever built them at all.

            In any case, GM also had a consistent habit of complaining about benefits that it didn’t bother to pay.

            Those obligations were allowed to pile up and were underfunded. The VEBA was later created to reduce and delay those obligations, and the subsequent bankruptcy eliminated even more of them.

            It’s a bit like a guy who complains about his mortgage but doesn’t send the checks to the bank. If it just sits on the balance sheet but doesn’t get paid, only to be reduced later, then the burden is largely theoretical at worst.

      • 0 avatar
        Big Al from Oz

        @DocOlds
        What makes Australia exist are the people, like any nation. Australia does have it’s positive and negatives.

        But, as countries go, Australia is what we term the ‘Lucky Country’.

        As for our welfare, public health, education, etc. It’s all managed by good governance.

        In fact as a percentage of GDP, we are taxed in between the US and Canada. So we aren’t a highly taxed country in the big scheme of things.

        Our welfare is strict, but well targeted. Our health system even with our high wages is still only 75% the cost per capita as the US’s current system. But we have a mix of public/private health.

        The prices you see for cars isn’t what we generally pay. These are only recommended retail prices. Our banking and finance sector is regulated fairly and freely, this protects the individual as well as has given us the strongest banking and financial sector in the world.

        As I’ve tried to explain to agenthex, our economy is quite flexible. What gives us this flexibility is our currency swings, good Reserve Bank of Australia and policies that have been implemented over the past several decades.

        Some of what is deemed left wing ideals within the US is readily accepted by us who lean to the centre right in Australia. Public health, our hex system of tertiary education and importantly our minimum wage structure.

        Our minimum wage is held dearly by most of the population, even employers. That is, if you work, your wage should be enough to live on. No great, but sufficient so you don’t have poverty.

        This also creates less disparity within the nation and the polarisation you are witnessing in the US over this disparity.

        As you can see I’m not really left or right. I just look at each individual policy and make a decision if it’s good or bad for Australia.

        • 0 avatar
          doctor olds

          Al- I love your country and people! We have a lot more in common than our differences. My writing may give the false impression that I am knocking you down, when my purpose is really just to bring perspective.

          • 0 avatar
            Big Al from Oz

            @doctor olds
            Contrary to some of the views, engineering has many paths to follow as a career. It seems some view engineering as just design and maybe research. Well, they’ll be surprised at how many technical management positions there are for engineers.

            My job would be equivalent to an engineer working in a race team.

            I have been involved in our technical college as well.

            Now, I work outside, which I find is fantastic. I’m only stuck in an office 50% of my time. What a great way to see out retirement. To get out amongst it and even sometimes the young blokes give me a wrench!!

            But, at the end of the day, I’m the one responsible for screw ups. So for every upside there is a downside.

            I really enjoy my work now, careers seem to get better as you age. But a career must be viewed as an extension of your everyday life. Then it doesn’t become an onus.

    • 0 avatar
      Pch101

      I can think of at least two members of the Aussie team who wouldn’t understand it if they did read it.

      Nonetheless, there isn’t much that you can do about it. The auto industry needs scale that is large enough to support the automakers and their local supply chains, and Australia doesn’t provide it.

      The Germans (sans Opel) have done a beautiful job of cultivating a mystique that uses national origins to justify premium pricing. The Aussies obviously haven’t done that, and it’s a bit too late to start now. The partial answer is to get into a high-value industry that isn’t easily replicated somewhere else and that isn’t easy to offshore completely, not to fight to preserve an industry that isn’t sustainable.

      • 0 avatar
        RobertRyan

        @Pch101,
        If we were allowed to export, Yes the Australian manufacturing of cars primarily would be still alive, but increasingly imports were fragmenting the general market.
        The US has a lot worse export story than Australia. The bulk of “exports” go to Canada.(which is also included as the US?) I believe a total figure of roughly 40,000 US built vehicles. went to countries outside NA.

    • 0 avatar
      RobertRyan

      @Athos Nobile,
      That is why I disagree with Big Al From Oz, Yes I know that is coming what is more worrying is the Chinese slowdown and the impact on the US Economy , that will be a double whammy.The Chinese will start taking money out of the US(They are its biggest Investor) and US Companies who thought China was a gold mine will be burnt.

      • 0 avatar
        Big Al from Oz

        @RobertRyan
        I see it this way.

        If the Chinese collapse the Europeans have more to lose than the US.

        I do think the US economically is flexible enough not to collapse as hard as the Europeans will. The US is fragile, but it isn’t in the same boat as the Euro’s.

        But they will fall like domino’s. Euro’s, Japanese/Korean, US.

        I’m waiting for the ‘Great Depression MkII’. This will unfortunately occur from what I see. Many OECD economies are fooling themselves if they think life can go on as in the past.

        The greatest of all Ponzy Scheme’s will unwind.

        • 0 avatar
          RobertRyan

          @Big Al from Oz

          “But they will fall like domino’s. Euro’s, Japanese/Korean, US.”

          It is a house of cards. I think believe it or not the US is even more fragile than Europe. Some of the “positive” economic news defies belief.
          More like a terminal patient who “rallies”

          • 0 avatar
            Big Al from Oz

            @RobertRyan
            I just hope the so called ‘experts’ get it right. Our system of survival is based on debt and growth. Growth isn’t outstripping debt.

            Or are they just attempting to wind down economies without a collapse?

            I don’t envisage the OECD nations to be as powerful as they once were.

            We are losing our influence. It seems influence is economic strength.

            As I’ve always stated the GFC is the imputus that initiated the process of change in ‘affluence, influence and effluence” globally.

            There will always be winners and losers. I think the winners will be the ones with the least debt.

            The one thing about capitalism that many forget. The value of an asset is only worth what someone is prepared to pay for it.

            So, have money in the bank to buy up re-valued assets.

          • 0 avatar
            RobertRyan

            @Big Al from Oz,
            What is exceediingly ironic is the OECD and the US are sweating on a Communist State for the economic survival. Joe McCarthy will be spinning in his grave.
            ,

  • avatar
    doctor olds

    @28cars-later- The article simply means that GM’s engineering centers in Europe and Asia, where gas is expensive, had the lead for a large share of the vehicles being released at that snapshot in time.

    GM froze most product development during market collapse and run thru bankruptcy. The ATS, for example, was under development before I retired in 2008 but the freeze delayed the introduction.


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