Hacker News new | past | comments | ask | show | jobs | submit login
Australia Mourns the End of Its Car Manufacturing Industry (nytimes.com)
129 points by kumarharsh on Oct 20, 2017 | hide | past | favorite | 178 comments



I used to work at Toyota in Australia, which also shut down recently. A lot of people here are saying this is about quality, but it's really about profitability.

Australia's economy is heavily dependent on mining, and China's economic growth created a local mining boom. This resulted in heavy demand for Australian dollars, and at its peak in 2013 1 AUD was worth about 1.05 USD.

It was at this time that Ford (the weakest of the three Australian manufacturers) made the decision to close its Australian manufacturing operations. The high value of the local currency meant the factory was unprofitable and uncompetitive with other factories around the world.

The conservative government at the time, led by Tony Abbott, refused to provide subsidies to help close the gap (even temporarily).

Toyota and GM Holden had similar problems, and all knew that the local automotive parts suppliers needed at least three companies to sell to. So once Ford was out, the supply chain for parts became unsustainable, and the others quickly announced that they would pull out too. It takes time to close an entire industry, which is why all three companies closed their factories in 2017.

Around 2015 the slowdown in China's growth led to a slowdown in Australia's mining industry, and a drop in the AUD. It dropped to around 0.80 USD, and interestingly, Australia's car manufacturers became quite profitable again. But the wheels were already in motion and the decisions couldn't be reversed.

Australia's mining industry has bought in a lot of money, but its impact on the dollar has done a lot of damage to the country's export economy. There's a term that economists use to describe this: Dutch disease. Australia has a bad case of it.

Edit: s/80 USD/0.80 USD/


> This resulted in heavy demand for Australian dollars, and at its peak in 2013 1 AUD was worth about 1.05 USD.

One of the main reasons the AUD remained at such high levels was because of the carry trade.

http://www.abc.net.au/news/2011-05-09/carrying-the-australia...

From the link below you can see the Reserve Bank of Australia kept interest rates very high during that period:

http://www.rba.gov.au/statistics/cash-rate/

That allowed big multinational banks to borrow massive amounts of money in one country at a near zero interest rate and park that cash in Australia to get a guaranteed 4% return on those billions. That create the high demand for the AUD which drove up it's price.

The RBA was asleep at the wheel as it should have driven down that cash rate much faster and far sooner than it did.

Only after they finally moved and started cutting the interest rate did the dollar fall to the levels we see today.

Unfortunately, they now find themselves in a bit of a mess, since the economy really needs another rate cut to help repair the damage caused by that high dollar.

However they can't do that because it would add fuel to an already over heated property market, which is starting to look a lot like a bubble.

If they had moved earlier, the local manufacturing/export/tourist industries would be much stronger today and the RBA would in fact now be in a position to raise rates, something that is desperately need to take heat out of the property bubble.


They are between a rock and a hard place. If the housing bubble burst, it would be far worse than a high Australian dollar.

Unfortunately, we needed our bubble burst nearly a decade ago. When it bursts now, the pain is going to be incalculable.


this is how a stone age economy works - you sell your rocks (mining) and bricks (real estate) to sustain your way of life.


Wouldn't driving down interest rates at that point have pumped up the housing bubble even more back then?

Ultimately there's only so much you can do with interest rates.


I think it is all in the timing.

Consider this chart of the AUD to the USD over that time:

http://www.xe.com/currencycharts/?from=AUD&to=USD&view=10Y

From the RBA interest rate chart linked earlier you get these maximum yearly numbers over the last decade:

    Year    Rate    AUD
    2008    7.25    0.69
    2009    3.00    0.91
    2010    4.75    0.98
    2011    4.75    1.10
    2012    4.25    1.51
    2013    3.00    1.50
    2014    2.50    0.94
    2017    1.50    0.80
As the numbers show, before the GFC and even after the GFC through to 2014 (some 7 years) the RBA kept the rates very high.

Thanks to those high rates the carry trade kept the AUD high, but those high rates also put a dampener on the housing market.

Now during that time most of Australia was struggling, but two mining states (WA, QLD) where doing extremely.

China had created a commodities bubble that saw iron ore prices well over the $100 a tonne.

By 2014 the mining bubble had bursts, so much so that WA, the once booming state was on it's way to recession.

Only then does the RBA then decides to move on rates.

However those 7 years of high AUD has really hurt the local export industry, the tourist sector and the agricultural sector industry.

But even after 2014 the RBA is still slow to cut so the carry trade persists, keeping the AUD stubbornly high.

However, with the rate now at 2.50% and going even lower in the years to come, mortgages are now very cheap and only getting cheaper.

Say goodbye to the mining boom and welcome to the housing bubble.

Might point would be, if they had cut faster after the GFC they would have kept alive the other non mining sectors and then, if they had seen a problem developing in the housing market they could have raised rates to deal with the issue.

Over that time they did the exact opposite.


Looking from the outside I'll be honest you can't have everything. One of the primary aims of a central bank is to control inflation which it looks like the bank has done pretty well.

https://www.rateinflation.com/inflation-rate/australia-histo...

In hindsight it's easy to say what should be done but they really look like they've done a pretty decent job. No economy grows forever and Australia has had a very good run in recent history.


Those inflation figures you quote don't reflect what is actually happening in Australia.

Like most of the developed world wage growth in Australia is flat and has been flat for at least the last decade. So wages growth has not driving up inflation.

However, each time a cyclone hits Queensland that drives up the price of bananas and other fruits, which does drive up inflation.

Add to that the fact you can now buy Australian gas at a cheaper price in all parts of the world other than Australia. Go figure?

Then consider the fact we closed our oil refineries so we could import our gasoline from Singapore.

Strangely enough when the international price of oil goes up (or the AUD dollar goes down), we instantly pay more for our gasoline.

However when the international price of oil drops (or the AUD dollar goes up) the price of gasoline takes weeks to come down. Strange?

Add to that the current joke in Australia where most state governments have privatised their electricity utilities only to see the price of electricity increase by 20% in last quarter.

So yes we do have lots of inflationary pressure here in Australia, but most of that pressure is created by the multi-nationals screwing us with our elected governments providing the lubrication.


Exactly. Everything is easy if you aren't the one driving.

It's especially important to note the difference between the resource driven WA economy and the property driven Sydney/Melbourne economy.


I'm glad someone wrote this.

The posts about low quality are just continuing stereotypes, and the data shows the opposite. Look at the ratings for any Australian built cars that were exported or sold in Australia, and they do really well.

The thing about long supply routes is wrong too. Mass freight is just so cheap that location doesn't matter.

The exchange rate killed the industry. $A1 bought $US0.5 in 2000, and $1.05 in 2013. Hard to export competitively when that happens.

OTOH we did avoid mass unemployment during the financial crisis, and the economy even kept growing so I guess that is the upside.


"Mass freight is just so cheap that location doesn't matter."

It's not so much the cost, but the time. Distance from your suppliers and customers can matter a great deal.

If you have to keep higher inventory because of longer lead times, or have to suspend the line (or store unfinished cars) while you wait for a part revision from a supplier, it puts you at a big disadvantage when you're waiting weeks for shipping rather than days.

Economies of scale is also an issue. In the absence of significant tariffs, it's hard to sustain an automotive industry that's only supplying a domestic market of ~24 million people. Countries like Canada and Sweden do sustain significant domestic automotive manufacturing, but they export a large portion of the cars to bigger markets.

But you're correct, of course, about the exchange rate being the primary cause. The resources boom drove the AUD higher, and also increased the cost of labour.


but they export a large portion of the cars to bigger markets

Which at $AUD1 = $US0.5 was happening pretty successfully, and even at 0.75 (or 0.8 like now) was possible.

In the absence of significant tariffs

Tariffs aren't the only form of government support, and are far from the best.

In Australia we had significant tariffs on cars until the Button plan reduced them over a long period of time. It lead to low quality cars being produced in Australia, which were uncompetitive internationally and couldn't be exported.

There are other forms of government support which are more effective, and could have been used in this case to keep the car industry going. Notably the car companies didn't ask for tariffs when campaigning for support.

increased the cost of labour

Not really, in South Australia.


> The conservative government at the time, led by Tony Abbott, refused to provide subsidies to help close the gap (even temporarily).

It's not as if we didn't try to transition the industry to success. This Button plan was by a Labor government.

https://en.wikipedia.org/wiki/Button_car_plan


The fact that Australia is doing free trade agreements left right and center with Asia doesn't help either. The Thai trade agreement really worked well for Toyota. Most of the Toyota imports are from Thailand nowadays. Not many of them are imported from Japan.


This is hardly surprising when you know a little local history.

For reference: I grew up in Adelaide, about 15-20 minutes drive (15 km.. erm 9.3 miles for you lot) from the suburb where the Holden factory is located.

I remember as a student/early graduate (so, 2000 - 2003ish) having.. acquaintances who were in their early 20's, bringing home close to $AUD100K/year, for assembling commodores. People who would laugh about how funny it is to let a car leave the production line, with the wrong colour door handle fitted.

Another "acquaintance" took forever to get a resolution because his 2-door ute was delivered to him with a 20cm gap in the carpet on the passenger side. It went through the factory, through QA, through a DEALER and nobody fucking noticed a 20cm gap on the passenger side of the floor.

These were not high quality cars being built by well trained craftsmen. They weren't even average quality cars built by moderately trained craftsmen. They were pieces of shit slapped together by over paid idiots.


And now in the coming decades you get to watch the slow process of people becoming increasingly nostalgic about Holden cars as survivor bias ensures that only the best specimens survive.

"Look at that old Holden! Hasn't needed a repair once in 30 years, not like these shitty foreign imports you get today!".


And the same process will occur with the memories of their jobs. In X years, a politician will harken back to the days of a strong local economy where high-quality products were produced internally and provided a living wage. Slogans will be created ("MAGA" works in Australia) and campaigns will be run.

Nostalgia and lies are tricky bedfellows.


I mean, it seems hard to disagree that things were better in Rust Belt cities before deindustrialization. You might quibble about why it happened or what should be done about it but Detroit went from being a beautiful, world-class city to a byword for crime and urban decay within living memory and plenty of smaller cities are worse off.


Hm? Detroit ungentrified, housing became affordable, artist communities flourished, over-policing went away, corrupting corporate influences and (especially) real estate developers vanished. Detroit is everything every growing liberal city claims to want and writes public policy to work towards.


Wasn't there a bankruptcy in there somewhere?

> "corrupting corporate influences and (especially) real estate developers vanished"

... and were replaced with a level of government corruption (and incompetence) that would have been funny if it weren't so sad.


Yeah, that doesn't sound like an argument I actually want to engage with.


"Ungentrified"? Is that a euphemism for a place you'd want to live turning into the kind of place where you're afraid to go out of town for the weekend because all your stuff will be gone when you get back?


He's trying to be cute and say anyone who complains about rising rents is trying to turn their city into Detroit.


Anyone who complains that their city is too attractive to the (upper) middle class and thinks that public policy should seek to motivate people with good jobs to stay the hell away, yeah.

I’ll complain about rising rents too, but from a place of “we need more housing” and not “people need to stop trying to live here.”


When I was a kid in the late 50s people would brag to all who would listen if their car made it to 100k miles. It reflected on the immeasurable quality of the car and careful maintenance you did. They don't make them like they used to and that's a very good thing.


This is just like the death throes of the Rover MG models in the UK.

In 1999 (or thereabouts) I was sick of being run off the road on my motorbike and decided to buy a car. Being an IT contractor with silly Y2K rates going on, I had plenty of disposable cash.

First dealer was Toyota, Bill Allen's of Cheltenham. The salesman looked at me, decided I didn't have money then completely ignored me. Nice.

Second was an MG garage whos name escapes me. Literally every car was was wrong - either the doors didn't fit, or there was a clunk when they closed, or in one case they didn't bother fitting the rear brake light (internal) correctly and it fell off during the test drive.

I have never seen such a rubbish car in my life, literally each one I saw looked like it had been built on a Friday afternoon. No wonder they went bust.

Another anecdote: My boss at the time was awesome and from Birmingham, right next to the Rover/MG plant. He asked me to do a speech for his wedding anniversary, so I went along to a social club next door to the factory. I noticed there were hardly any of their own cars in the employee car park, it was all Ford, Mazda, etc. This tells its own tale, at a time where 'Buy British and save Rover' was trumpeted everywhere.


The only reason I have a Toyota now is the dealer was the only one who'd actually talk to me, so she got the sale. The other dealers would only show me the cheapest cars on the lot and wander off.

New Zealand's domestic car industry (where they simply connected the imported bits together) died in the late 80s when tariffs were removed and we've been better off for it.


Who’s we? Look at all the dysfunction (eg shooting of Steven Wallace) that goes on in communities that were left to rot by the transition to a market economy. It makes me wonder if it was worth it.


“We” = the people who will be crying in their beer in a decade when “we” are too old to be employable and bankrupt after the end of life of 1988-2008 systems and datacenters drops the bottom out of the IT labor market.

Billions are being invested in replacing that stuff today, and every one of those projects cuts staffing needs 90%.

The plumbers will be there laughing at office wankers who thought they had a sweet gig.


Those cars were trash, worse they even looked like a bad Ford rip-off, which are themselves cheap looking cars any way.


I had a mini, which was a very unique and fun design, and once had a Rover Metro as a temporary car while our car was in the garage -- also a vey fun car to drive and solid as anything.

Supposedly, the problem Rover hit was though their last-developed large car (Rover 75) was very good and reasonably popular, since they'd been pulled away from working with Honda by the sale to BMW, they had neither a modern middle-sized car nor a replacement for the Metro. Put that together with being passed from hand-to-hand (from BAe to BMW was 6 years, BMW to Phoenix another 6, and Phoenix lasted another 5) in an industry struggling from overproduction, and it was always problematic.

Whenever Citroen, GM, etc have gone bust, their respective governments have always stepped in. Competing in a loss-making industry against government-backed competitors is one tough game.


Note that it's not just Holden that went under - foreign car companies (Toyota, for example) also have closed their local plants, despite probably very different workplace cultures. It's probably more to do with a small local market, and strong exports of raw materials (and hence a strong currency) making imports more competitive.


One contribution often mentioned in op-eds etc here is Australia's comparatively lax emission, and non-existent fuel consumption, standards. The idea is that the competitive landscape has been weakened by these factors, making it possible for local manufacturers to avoid the hard work of innovation, and importers to dump old designs unwelcome elsewhere. I don't know enough about the car industry to assess the merit of this, though it would fit the general Australian business (and specifically manufacturing) pattern. There is a kind of comfortable torpor at large here, as most notably described in Donald Horne's famous book.


Holden was a foreign car company, no different than ford or Toyota.

The only difference is Toyota models are just imported from elsewhere because they have a mostly global product line.

Ford and GM Holden now need to find either European or North American models to import that will suit the local market.


One of Ford Australia's replacements for the Falcon (the Australian-built middle-of-the-road large family/commercial sedan [1]), is the Mustang, so in the past few years we've seen an influx of these American muscle-cars onto Australian roads. They're not quite to my taste, but hey each to their own.

The other replacement is the European-built Mondeo, which is much more like the Falcon and far less offensive IMO.

[1] https://www.carsales.com.au/cars/ford/falcon/


The safety record of the Mustang is horrid. Absolute shit engineering.

You'd have to be rather silly to buy one: http://www.ancap.com.au/media-and-gallery/releases/ford-must...


Safety isn't everything you know. The lowest scoring component (Safety Assist for stuff like speed assistance systems, lane support systems etc...) is basically about removing control from the driver and considering the target demographic for the Mustang, it makes not having them make sense. Some cars are made to be enjoyed and "safety" is increasingly compromising that concept.


> considering the target demographic for the Mustang

Entitled bogans who think they're the Jamie Whincup but are more likely to hurt themselves and others than win any races?

Seriously, this is what track days are for.


"“Of concern, the full width frontal test showed a risk of serious head, chest and leg injury for the rear passenger. There was also insufficient inflation of both the driver and front passenger airbags in the frontal offset test which allowed the driver’s head to contact the steering wheel and the passenger’s head to contact the dashboard,”

“The driver’s door opened in the pole test, and whiplash protection for rear-end collisions was marginal,”"


Exactly. In my book, cars with such poor ratings should be banned from the market. There really is no excuse.

"We spent all our money making the car look brutal and sexy to our target customers, so there was no money left to also make it safe". ... !


I get that you don't like active safety, but did you even read the part about the poor structural integrity aka crashworthiness of the car? That's why I wrote "shit engineering".

There are plenty of cars that are fun to drive and safe.


The Ford Mustang fails basic safety tests:

"“Of concern, the full width frontal test showed a risk of serious head, chest and leg injury for the rear passenger. There was also insufficient inflation of both the driver and front passenger airbags in the frontal offset test which allowed the driver’s head to contact the steering wheel and the passenger’s head to contact the dashboard,”

“The driver’s door opened in the pole test, and whiplash protection for rear-end collisions was marginal,”"

However, the demographic that buys Fords here in Australia are unlikely to read that ( or anything else...)

http://www.ancap.com.au/media-and-gallery/releases/ford-must...


The labour unions were unwilling to compromise to stay competitive with international factories.

I was surprised when it was reported that Toyota wanted to reduce the Christmas shutdown period from 21 days to 10 days in line with other international factories and the union rejected this. This was in the context of other car manufacturers shutting down in Australia at the time and they had to know that this attitude was risking Toyota leaving as well, but they just couldn't accept a reduction in any conditions.

http://www.theage.com.au/victoria/toyotas-altona-plant-to-st...


Toyota Altona workers were on 11 day fortnights. Were the workers at the international factories that their Xmas holiday time was compared to also on 11 day fortnights?

If I was doing 11 day fortnights I might want an extended holiday period over Xmas to get reacquainted with my family.

It is sad to read so many comments blaming the workers, their union and the quality of the cars.

Australia, a country of 24 million people, has more car brands competing for the customers dollar than any other country bar China.

"The flood of imports has given Australian car buyers more choice than ever before — and more than every other country on the planet except China.

Australia has 64 automotive brands, the US has 38 and the UK has 42." [1]

Why? Well Australia has extremely low import tariffs for cars lowering the barrier of entry for foreign car companies to compete. All while the countries from which Australia was buying these cars maintained import tariffs protecting their domestic car industries.

So Australia lets everyone import but everyone doesn't let Australia export. Sounds fair.

It is sad that politicians dogmatically denied car manufacturers the support of the state while these manufacturers are competing in an international environment where every other country is subsidising and supporting their local car manufacturers.

We see a similar ideological approach with Qantas. A lot of the major international airline carriers are de facto supported by the state but in Australia subsidies are a political no-go zone so we leave them to the dogs.... and blame the workers and their unions.

I'm as opposed to subsidies as the next man in the long term BUT these industries employ huge numbers of our citizens and foster unique and important skillsets. As a nation Australia should work towards the ideals of removing subsidies and trade barriers but why do we martyr ourselves for the cause while every one else is ignoring them?

[1] http://www.heraldsun.com.au/technology/why-australian-car-ma...


While I'm not sure that this is a great example for it there's always the matter of deciding if any job is really better than no job - sure, you could stay competitive with other places/countries by matching ever worse conditions, but is that really a good idea? Is a job which doesn't pay someone a living wage really a job that should exist?


I think you've moved the goal posts a long way there.

A living wage as defined by the Harvester judgement, which seems to be what you are referencing, was based on begin paid enough money to be able to afford food, shelter and clothing for a family.

In the case I'm referencing the dispute is over whether the workers should have their standard break for Christmas reduced from 21 days to 10 days. I can't think of any other companies within Australia that offer such a generous Christmas break, but maybe there are some; i think it would be a very small number. What they were being asked to give up seemed very generous and the replacement of 10 days instead doesn't seem onerous - it still seems generous compared to many companies.

You'd have to ask the workers that lost their jobs if they are now better off having lost their jobs rather than stay competitive with other places by bringing their conditions in line with what is typical even within the country they live in.


I don't believe he moved the goalposts at all, he made a valid point. The argument that you have made about staying "competitive" IMO is a classic example of bandwagon fallacy. Just because other countries allow companies to treat their workers like shit does not make it ok for our country to start doing it.

I also disagree with the way you phrased your point, on one hand, you mention that the unions would not budge on conditions, but then state that they should have because "no other company that you know of" allows 21 days of holiday over the Christmas. First of all drawing to the fact that the Union represents workers, not companies, it makes sense why the companies have an interest in shortening the holiday break of the workers. It is not in the interest of workers however. To counter your point that their breaks should have been cut in line with that of other countries, then we should keep in mind that some Northern European countries are going further in terms of workers rights, in the opposite direction, so all of us a sudden, your advice that we should follow the lead of some countries leads us to question which way we go.

I would also like to highlight that the CFMEU (Construction) enforces a 17 day shutdown over the Christmas break, so there are other's who do lengthy breaks.

I also struggle to understand your last point about bringing conditions in line within the country they live in, Australia has Union representation across most industries. If you wish to do business in Australia, then you surely understand this, I would hazard a guess that given this, then good conditions and decent pay is the typical situation. Why would anyone want to degrade that?

Winning a race to the bottom is a zero sum game.


But we're not talking about treating workers badly by any reasonable definition. These are workers that were paid more than the average Australian worker, they got far more Christmas holiday leave than the Australian worker. They weren't living on the minimum wage.

They weren't forced to take a reduction in Christmas leave. They company asked if they could, considering the local and international conditions in their industry. The workers weren't forced, it was their decision and they said no, presumably knowing that the consequence might be that this may be the straw that shuts the factory down permanently.

If the company had made a draconian decision that cut workers pay unreasonably, regardless of the current economic circumstances and pocketed this money, I'd agree strongly with you. But, this isn't what happened. The workers kept all of their conditions and the factory shut down.

There have to be some circumstances where you would see that it would be reasonable for workers to give up some conditions in the industry they are working in if it is under some economic pressure, either internally or externally? They may only agree to give them up temporarily until conditions improve, or make some other offer to help the company to increase output or reduce costs.

The reality is that Australia is an open, market economy. Its companies have to be competitive with the rest of the world in order for those companies to survive.

You say that companies only have an interest in shortening holiday breaks. But if this is the case, how did the holiday break end up as 21 days in the first place? Companies have to compete for workers too - there must have been a time when it was beneficial to the company to attract and retain workers with a longer Christmas break. You point out that some European countries have more workers rights, but this misses the point that the competitive pressure at the time wasn't for workers - it was on total cost of production.

Nobody wants to degrade good conditions and decent pay for workers. However, for many people that work in small business and haven't had a pay rise in several years can only look on with bemusement when highly unionized industries demand 4% pay rises plus extra Christmas holidays and then demand tax payer money when their industries falls over.

It seems like every time a unionized industry is asked to make a small concession that it's seen as a zero sum game, the thin end of the wedge, a race to the bottom and the apocalypse. It's blown completely out of proportion. Most industries go through ups and downs. The inflexible ones go broke.


> Is a job which doesn't pay someone a living wage really a job that should exist?

Should people who have other means of support be allowed to hold jobs?


Yup. It's always labor's fault.

Executives, investors, management, industry, market, over production, competition, technology, and economics are never a factor.

Stupid labor.


How is it that smaller countries like Malaysia and Taiwan can support their own native car industry (while also importing foreign cars) but Australia can't?

Are the tariffs just not as high to effectively subsidize their local car industry?

To add. I think those counties understand that the car industry helps to invigorate many other parts of the economy, so it's sad to see AUS let that go like that.


A combination of labour costs, being the most isolated country on earth and a tiny local market. Malaysia's GDP per capita is <20% of Australias (49k vs 9k), and the population is 30% bigger (30mil vs 24mil), not to mention the surrounding local markets (Thailand at 68 mil, Vietnam at 92.7mil).



Thailand taxes all imported cars at something like 120%. (So a 50K car becomes a 110K) to encourage the local industry.


If a particular indsutry lacks comparative advantage in some country (in this case Australia) it only stands to reason that others do have comparative advantage in it.

So you we can speculate why, in a complicated world, the (cars, Australia) paring works badly while the (education, Australia) and (cars, [South!] Korea) pairings work well and the (cars, Taiwan) paring is somewhere in between.

But an important answer behind all of these is: The market speaketh thus.


Good question. Maybe lower salaries for factory workers.


> I remember as a student/early graduate (so, 2000 - 2003ish) having.. acquaintances who were in their early 20's, bringing home close to $AUD100K/year, for assembling commodores.

This figure likely included a lot of overtime - the average annual salary at the Elizabeth plant was only $60,000 according to Senator Kim Carr.


When annual salaries get reported in this context, you have to watch for the pea and the thimble trick where they take the base hourly rate and multiply that by standard hours to arrive at the annual salary, but nobody actually gets paid this amount.

This is because the base rate leaves out all of the various loadings that are applied under different circumstances. There are so many circumstances for loadings that the base rate becomes meaningless.

Overtime is only one way to get paid more than the base rate. Also, overtime becomes a meaningless word when you can get overtime just for working slightly non-standard hours, as opposed to working extra hours.

The agreements are written in a way that makes it really hard to calculate what a worker is actually likely to get paid annually. The only way to be certain is to look at the worker's group certificate for tax purposes.

So, while what Senator Carr said was probably technically correct, it was also meaningless since I would suggest that no worker was actually paid that amount in a year. It would be more meaningful to ask what the average amount on a worker's group certificate was.


I think my point is the same as yours - that you can't take figures reported on face value.

> It would be more meaningful to ask what the average amount on a worker's group certificate was.

I think a better figure yet would be the average amount per FTE.


You are right that per FTE is probably a better measure technically, but this just leaves the unions a loophole: they can just classify workers as something other than FTE. They are very clever at finding these sorts of loopholes and exceptions.

What they can't do though is lie to the tax office. That crosses a threshold from being misleading to being illegal.

There is a big incentive for unions to be misleading about what their members are paid. It's hard to garner a lot of sympathy from the public when the average member of the public is paid a lot less than the average union member. That's not to say that this is always the case - the wages, agreements and marketing to the public by the unions varies significantly between unionised industries.


> but this just leaves the unions a loophole

I'm not interested in talking about unions like you are. Merely getting an accurate read on how much an employee earned.

What you're proposing is eliminating the value of people's time from the equation. Working extra hours or unsociable hours should be paid more because they represent the employee trading away their spare time for more money, and as spare time approaches zero the amount they require at the margin should also increase.

I don't think standardizing all hours across all employees is fair in that regard.


I'm not advocating what you are suggesting. I agree that workers should be paid extra for working additional hours.

I also agree with you that it's important to get an accurate read on how much an employee earned. My point is that there are some people that have an incentive to obfuscate this amount and that I can only see one unambiguous way to avoid this obfuscation.

I think the starting point in these discussions should be what someone was actually paid, not what they might have been paid. Then if that amount can be justified by unsociable hours, extra hours, or whatever, then that's fine. But if the various hours, loadings or whatever seem unreasonable then that's a different discussion.

I wouldn't even normally be interested in what someone's paid - it's not my business. However, the car manufacturing industry is a different case since there was an expectation that tax payer's money should be used to bail it out. In my opinion, tax payers deserve to know what it is that they are paying for, in detail. Particularly in the car industries case since it seemed like every time that the government tipped in more money that it was closely followed by the workers getting a pay rise.


> I'm not advocating what you are suggesting. I agree that workers should be paid extra for working additional hours.

Ah I'm sorry if I was unclear with that one. I'm not suggesting that you think people should all be paid standard regular rates irrespective of time. I meant that if you use a lump sum "average per employee pay slip" number you're not taking in to account those details.

With full-time equivalent, if George works 60 hours for example he counts as 1.5FTE. After-hours work is harder to quantify, but usually employment agreements similarly put extra value on those hours that can be translated back to FTE.

This seems the sanest and most accurate way to figure it out. The number actual people earn per week is a misleading figure.

I think you might agree with me here, because you said "Then if that amount can be justified by unsociable hours, extra hours, or whatever, then that's fine" and FTE is exactly the way to do that!

I just came across this four corners episode from 2016 which has the quote

"According to Holden management 90% of the workers earn between 43k and 55k per year" (https://youtu.be/CIRuU8qot3s?t=33m08s)

Straight from the horses mouth, as it were. Though of course .5FTE @ $43k is $86k FTE (for example) so we're back at the problem of standardization...


I see what you mean and that's a good and interesting idea.

However, I think while it would be revealing in some areas, it would mask other problems.

For instance, if you look purely at the FTE, you wouldn't see that George had worked 60 hours. That's a problem. Why did George work 60 hours? Was he really productive for all of that time or is he gaming the overtime system by deliberately doing less work within normal hours so that he has to do overtime to complete his scheduled work.


Well that’s a different issue isn’t it :-) you’re now getting in to management effectiveness - do people really need to do 60 hour weeks or is there something severely wrong with the factory...

Definitely all related though. In this case to bring it round to the start, I am focusing on the “how much does the average worker earn” problem. I have a little experience is human resource budgeting for a small team, and my establishment was represented in FTE.

Thanks for the chat, it was interesting.


There's even a Trabby museum in Berlin.

http://www.trabi-museum.com/home


[flagged]


You've been unsurprisingly downvoted, but there's some truth to what you say, as long as 'typical' is parsed as 'stereotypical' rather than something more mathematical. Anyone who has spent any time in Australia knows the type well.

My guess however is that the stereotype represents a shrinking proportion of actual Aussie males, though they're still there. We all have our own selection bias of course, but in my experience young Australian men are a pretty big improvement on their bald barrel-shaped shock-jock-addled beer-guzzling 4WDing [poofter/boong/woman/asian/tree/whatever]-hating coal-loving fathers who so despoil the Australian suburban landscape.


Interestingly it speaks a lot about the difference in culture--people rewarding excellence wherever its origin is vs. people working feverishly to excellence to whatever detriment in anything else.


This comment breaks the HN guidelines. We ban accounts that do this, so would you please read and scrupulously abide by https://news.ycombinator.com/newsguidelines.html from now on?


There is something to be said for some of this. There is a certain complacency and unwillingness to engage self-critical awareness.

Don't believe me? Many Australian men are two inches away from overt racism on one side, and super-duper-liberal-moral-high-grounder on the other.

That said, Australians are generally very kind and fun. But hard work and struggle builds both character and moral fortitude, and the typical Australian male is without either: They're gfted a generous opportunity, chilling out on the doll, or pushing papers in some uncompetitive bureaucracy.


> Australian men are two inches away from overt racism on one side,

I used to have several Australian coworkers who were generally quite pleasant and easy to work with, but several of them had an attitude and their interaction with dark skinned individuals was shocking. Having overheard them arguing with another Australian coworker about the case of the "abo gal fucked to death", I'm not surprised by your description using the terms "overt racism on one side, and super-duper-liberal-moral-high-grounder on the other". Their conversation was peppered with racist stereotypes, going as far as to blame the victim as being an "abo whore". I found out later that the victim was Lynette Daley, a young aboriginal woman who had been drugged and then, shockingly, literally, raped to death "blunt force genital tract trauma". There was little to no coverage of this here, but it does seem to have attracted at least a little attention in Australia. http://www.abc.net.au/news/2016-05-09/nsw-dpp-under-scrutiny...


Yea exacrly.

We also sort of have this kind of dichotomy in America. As a matter of public policy, our wars and policies unfairly target Muslims while we preach that any and all discrimination is illegal and intolerable. I like how the South Park creators put it: https://i.redd.it/bbwo4ropuesz.jpg


Really? I'm Australian and I've worked in factories, in airlines, in government, in the country and the city and I have never seen or heard overt racism.

I did see it in Netherlands though. I also worked for a few years in Netherlands, and I was shocked to see a woman, one of the management / HR mock the only black employee relentlessly with monkey noises.


I studied abroad in Melbourne in 2008 and it's crazy to see this happen. I guess I left a few months before the GM bailouts got started in the United States and the whole recession kicked off after that.

It was really neat to see a uniquely Aussie car culture that felt really vibrant. I loved that El Caminos and Rancheros, long gone in the US, were alive and well as Holden and Ford Falcon Utes. It was neat that Toyota had its own Camry-ish car, called the Aurion, made in Australia. It was neat that Pontiac in the US was getting the Commodore, which was a great-looking car. Even though it was still Ford, GM, and Toyota on some corporate level, they had their own unique thing that I was able to discover while I was there.


Aurion is not quite a Camry-ish car - it is a bit more up market and more importantly came with a much more powerful engine. The Aurion was probably the best car ever made in Australia, although it was never a great success.


Aussie here: Good riddance. This country is at the end of Earth in terms of supply chains and export markets, has a small local market and has extremely high labor costs -- all in all, a terrible place to build the kind of megafactory you need to stay competitive these days. The only reason they managed to survive even this long is massive government subsidies, and I applaud the fact that the government had the guts to finally pull the plug.

All that said, the transition away is going to have a high human cost, particularly in Adelaide which just doesn't have a whole lot else going economically. But my wife used to work for a Ford supplier in Melbourne, and that city has managed to absorb Ford's shutdown a few years ago without too much pain. (Nearby Geelong, though, had both the main factory and a steel mill, and is having a harder time.)


The subsidies were not that huge (at least recently), in the scheme of things. The local manufacturers were basically given a much slower reduction of tariffs than other imports, starting 25-30 years ago. Australia has generally been ahead of the curve in reducing these, relative to most places.


And when compared to the 4+ billion the government forks out for the coal, oil and gas companies every year, it is nearly nothing:

http://www.abc.net.au/news/2014-11-11/coal-oil-and-gas-compa...

http://reneweconomy.com.au/australian-fossil-fuel-subsidies-...

By comparison the car industry only received about 5 Billion over 10 years:

https://theconversation.com/factcheck-do-other-countries-sub...


I always find it amusing when people compare pork barrelling amounts as "only" or "mere". "It was only 5 billion". I wonder how many companies, schools, hospitals etc would like an extra 500 million dollars per year just for doing the job they should be already doing in a democratic capitalist society. How many people cried for IT workers in Australia when the 457s were imported en masse or Telstra, IBM etc out-sourced their IT to India? How much subsidy or compensation did the IT workers of Australia get for that? Australians complain about all the scams they get from Indian callers and conveniently forget that they only happen because Telstra gave overseas scammers a free trove of Australian consumer data and very little was done to stop it. Globalisation and cheaper prices come with huge hidden costs.


> I always find it amusing when people compare pork barrelling amounts as "only" or "mere". "It was only 5 billion".

It was 5 billion over ten years compared with nearly 5 billion each year.

When you do that comparisons it is a mere 5 billion.

Now I'm not arguing that governments should be propping up sectors with pork barrelling. That is something for the electorate to decide.

However, the current government always claimed they had to stop propping up the car industry, because governments should not be in the business of handing out subsidies.

That government statement is disingenuous and total hypocrisy, since they will not be removing those coal, oil and mining subsides any time soon.


Let's then not forget the 1 billion per year spent on keeping mothballed desalination plants operational, plants that talking heads like Tim Flannery got us into thanks to clueless Labor premiers.

Also: "Renewable energy sources such as wind and solar will receive subsidies of up to $2.8 billion a year up to 2030 to ensure Australia reaches its Renewable Energy Target, according to new research." [1]

1. http://www.afr.com/news/politics/renewable-energy-subsidies-...


So, without value-add industries, how will the economy of Australia function long-term? As an exporter of raw commodities? That has not worked out well... For pretty much every nation that's tried it.


The service sector is pretty huge, particularly education and tourism.

I'm more concerned about what will happen when the long-running property bubble pops, because this is propping up huge swathes of the economy (construction, banking, etc) and a lot of people have made financially insane decisions as a result. Lots of people in their twenties holding multi-million property portfolios, where rental income doesn't even cover mortgage payments, because all you need to do is get on the "property ladder" and watch real estate prices go up 15% a year forever...


Works ok in Norway.


How well is it working in Sub-Saharan Africa?

And, uh, Norway is diversifying its economy, instead of doubling-down on resource extraction. It's not actively de-industrializing.


I'm guessing that OP is referring to the publicly owned $1trn oil fund that the government has only recently dipped into. They're actually now claiming they're going to minimise withdrawals due to an increase in revenue (1).

Wish my own government here in Australia had the brains and chutzpah to do this a few years back. We've never been much cop when it comes to visionary economics (apart from, arguably, rum being our first legal currency).

(1) https://www.bloomberg.com/news/articles/2017-10-02/norway-s-...


Maybe not on the same scale but there's the Australian Government Future Fund[1] which is a sovereign wealth fund founded in 2006.

It's about 10% of the size of Norway's so not especially impressive but it does exist.

[1] https://en.wikipedia.org/wiki/Australian_Government_Future_F...


African nations have had a history of being pillaged from without and within, a comparison would be fairer among countries with similar governments and economic structures.


Nearly all nations have a history of being pillaged or similar.

Half of Europe was bombed, butchered or destroyed 75 years ago, the other half was enslaved or otherwise ruled by dictators for a generation.

China was tortured by several of the colonial powers, the Japanese, and then Mao. It's the world's #2 economy today.

Japan was flattened and nuked. It's the world's #3 economy today.

Germany was destroyed, split in half, and impoverished on one half for two generations. It's the world's #4 economy today.

South Korea survived a horrific civil war and Japanese occupation. Starting from intense poverty just 50 years ago - $150 per capita GDP - it now has the world's #11 economy.

And so on.


Of those non-African nations you mentioned, it is absolutely astounding that South Korea not only escaped the abject poverty but has joined the top 10 or 15 in a lot of metrics used to measure a nation. In 64 years.

After the end of the Korean War 1950 - 53, South Korea was the absolute last on the planet in terms of GDP. Poorer than most of the poorer nations.

And remember the trauma of having gone through a conventional warfare that went up and down the peninsula about 4 time. Not some guerrilla warfare where a neighborhood here and there goes up in smoke but a good old WW1 style warfare of massive artillery barrages.

And before the Korean War, Korea was largely a place stuck in the 19th century, with no modern education or institutions to speak of.

In 64 years, they educated the population, built up basic economy, and than kept on advancing.


You are severely distorting reality. Japan has only become powerful again after WW2 because of massive investments in the Japanese economy by the US when they were fighting the Korean war and then the Vietnam War. The Japanese economy grew tremendously ONLY because of that. And every Japanese is very well aware of that.

Same story in Western Germany; massive investments from the West to prevent them from turning to the Soviet block.

And so on. Don't oversimplify History.


Norway does seem to be exceptional in this regard.


Yep, this has been a long time coming. I grew up in Adelaide, even in the late '80s the car industry was politically contentious, needing large tariff protection to be competitive with imports. AFAIK the wind-down has been slow and steady with no sudden surprises.


I agree good riddance, but for a different reason. I hope we can start to move towards smart cities, and getting rid of cars. It is ridiculous the reliance on cars that people in cities have.


... have you ever been to Australia? It's a big fucking place with fuck all people (compared to a lot of the rest of the developed world). The solution to society's problems is not "all get rid of our cars and live in shoe boxes 1 minute walk away from each other".


You're both wrong and right :p

While the distances between the towns in Australia is massive, most of our population resides in a handful of urban coastal cities.

While car culture is historically dominant, the biggest cities are all seriously trending towards increased densification, and much of our substantial immigration over the past 2 decades had been from nations used to much denser living.

I leave open the question as to whether it is the answer to all societies problems, but it would be a brave man to proclaim that wasn't the way Australian cities and population hadn't been trending for the past 10 years, and we'll likely trend for at least the next 10.


most of Australia's population lives in the suburbs surrounding the city.

Public transport from the suburbs to anywhere but the city or somewhere directly on the way, is terrible.

Will we have better cars that are less polluting, safer, even self driving? Sure. Will we get rid of personal motorised transportation? No.


Yeah, people here are ridiculously addicted to cars, even in inner city regions. Ridiculous.

> Will we have better cars that are less polluting, safer, even self driving?

Sure, whatever. Considering the huge amount of pollution that goes into just creating the car, it is silly to talk about less polluting. Safe? Yeah, that why the road toll is going up. Self driving? Can't come soon enough, since people are incapable of concentrating long enough and are too selfish to drive safely.

Private cars are a stupid idea, and have caused way more problems.


The road toll has been on a steady downward trend since the 70s. https://en.m.wikipedia.org/wiki/List_of_motor_vehicle_deaths...


Perhaps I am overly generous in assuming that anyone talking about getting rid of cars is partaking in rhetorical hyperbole, and moreso making the point that we might be moving away from 2-3 cars for every household in the burbs, and approaching/trending towards 1-2 overall.

I will add in addition to my above post, that our high property prices are additionally feeding an additional densification trend...


I don't know where you live but everywhere I've lived, it's been 1 maybe two cars per couple, or one car if the person is single. The only exception I've seen to this is if people own a motorbike too, but then it's usually 1 shared car for the couple and a motorbike each.


Luckily the Australian census and statistics are quite targeted on these areas, so you can drill down to quite detailed area level analysis.

You can google for "Australian Census 2016 quick stats" and get this information for most places in Australia.

Where I currently live is very atypical for Aus, about 75% of households here have 1 or fewer cars, but I've lived pretty much up and down the entire east coast and have a relatively intimate knowledge of both this country and the collection of information on it.

As Russel Coight might say: "I've bend around this wide brown land, seen a thing or two..."


Thanks for the tip about the census I found this http://profile.id.com.au/australia/car-ownership

Looking at aust-wide and state by state, it's as I described, at most (in wa and tas) 18% with 3+ cars, but 60+% fall into 1 or 2 cars per household. The rest is no car and no answer.


Indeed, but it depends a bit on whether you feel the 2 car households should be grouped in with the 1 car households or the 3 car households.

For completeness, one also has to ask whether or why we measure or comment using the statistical concept of households or persons.

Using WA as an example, ~34% of households had 2 cars. We can say that ~56% of households responded that they had access to 2+ cars. We can also say that almost ~75% of households responded that they had with 2 or fewer cars.

However, if we want to come up with an idea of a "representative australia" (an arguably increasingly erroneous concept by the day), we have to realise that the distribution of "people" amongst households will not be uniform.

Indeed, there is likely a strong correlation between the number of people in a household and the number of cars in a household.

What this means is that although only 56% of "households" reported having 2+ cars, the number of "persons" who experience life in such a household is not proportionate to the number of households reporting each characteristic in the population.

Indeed, given that one stat is likely correlated with singles, students and dinks, and the later is likely correlated with early and extended families, you would likely find that on a population weighted basis, the 2-3 car households may need to be counted as some multiple of the single/no car households.


sounds like you live in a city with young people whereas if you are in a suburb it’s families with a bunch of cars. Both parents can have a car, and they can have a van and maybe they’ll have a car for their 16 year old kid.


Doesn't sound like any Aussie suburb I've lived in.


Yep, and try getting the government to pay the billions required to get public transport up to standard to be able to just provide adequate transport for the majority of people in those cities.


If I'm not mistaken, the person that you're responding to is from Australia and lives in one of the cities where Ford closed their factory :)


Yes, I have lived in Brisbane, Melbourne and now Sydney. All 3 cities could do with no cars.

But people here are too addicted to them, and couldn't even imagine going down to the shops without a car. And make lots of excuses about it, such as it is too far and too big.


Let's pick common ground. Define "Melbourne"? How far from the cbd before it's not Melbourne for you, because I know you can't be suggesting people in Frankston or pakenham don't need a car.

And from personal experience I can tell you that any argument of not needing a car goes out the window as soon as someone has kids. Discussion over. Unless you're volunteering to cart around all the shit parents take with them?


It's almost too obvious but... cars aren't going away, mate.


For example the v8 interceptor will outlive all those so called "smart cities"


Not steel, but rather an Aluminium Smelter and Mill.

Also, just down the road its accompanying power plant/coal mine:

http://www.alcoa.com/australia/en/point-henry/default.asp


Interesting detail is that the, for American market created, Chevrolet SS was basically a rebadged Holden Commodore built in Australia. Together with the Dodge Charger, it was the "cheapest bang per buck" performance sedan with a V8. Although the Charger still for sale, the Chevy SS died with the closure of that plant making the 17' model year it's last.


I got really confused for a minute because I confused the Holden Commodore with the Hudson Commodore! https://en.wikipedia.org/wiki/Hudson_Commodore


The Aussie economic model - export bulk raw materials to China, buy manufactured products back - is a curious inversion of the old British Empire economy. And it's one that is not even remotely viable over the long term. Countries whose only source of wealth is raw materials get eaten alive by manufacturing economies, then left to rot when the mines are exhausted. There is a ton of historical precedent.


Yeah, but the vast majority of Australia's economy (just like the US and all other developed countries) is services, not resources or manufacturing or farming. We just talk about resources because they're a distinguishing feature.

Mining is only 8.5% of Australia's GDP and 2% of its employment. Sure, it would suck for a few years if the whole sector vanished overnight, but it wouldn't cause long-term devastation.


The sheer scale of Australia means that they're not about to get exhausted anytime soon though. Only something on the order of 1% of the continent has even been prospected yet.


The best data I could find is here: http://www.ga.gov.au/scientific-topics/minerals/mineral-reso...

That document lists 51GT of 'accessible economically demonstrated' iron ore, with an production rate of 0.81GT per annum, and 86GT of inferred resources (ie. yet-to-be-prospected).

So there's at least half a century of ore left, even if production ramps-up steadily. 1% prospected doesn't seem supportable though; it's more in the range of 50% based on the ratio of the inferred to known figures above.


Australia will always have whatever resource is in demand next. Three lithium mines are coming online every year for the next few years starting this year.

Australia will become the largest natural gas exporter - it will overtake iron ore in value in the next couple of years.

Then you have tourism, education and becoming the food bowl for China's growing middle class

Everyone likes to complain about being resource-export dependent but it has never been more than ~10% of GDP and is quiet an enviable position to be in


Yep, we have about 600 years of coal and a couple of centuries of gas, iron ore, uranium and god knows what else.


From where are you getting the 1% figure?


I don't think it's an inversion. The British Empire got materials from far off places like australia in exchange for manufactured goods, made in the centres of civilization where all the people are. You don't see Norway making stuff, you need more people (or less minerals) for that.


Curious what you mean by eaten alive. Historically manufacturing was a sign of power and prestige, but now it's been commoditized in favor of financial markets and real estate, which is going fine in Oz. Countries that make things sell them for pieces of paper (or electronic bits) that aren't backed by anything except their and their countries marketability.

The next wave of AI-driven manufacturing will decentralize things and you may well see this plant re-opened, albeit without people.


Unsustainable processes always end.


Their 'cousin' Canada is somewhat similar except replace 'China' with 'USA'.


It think it's safe to say that Australia will approximately never run out of iron ore.


It's not running out of 'X' it's 'X+extraction+shipping' vs local production. The USA for instance has all the rare Earth elements it could ask for, they just cost more to dig out than buying from China.


Holden - better known as GMH or GM Holden - where the GM stands for General Motors, a famous US-based company that bought Holden in the 1930's.

The other 'famously Australian' car manufacturer is Ford. Indeed.

The kinds of (Australian) people that find cars interesting tend to polarise between these two manufacturers, adopting the beliefs that it's patriotic, and that it can be economic to produce (in most cases components were built overseas but assembled within AU) cars in Australia. A country with breathtakingly high labour costs, small population, and low population density. Specifically a relatively small market, container shipping costs flatten out across the country.

That the designs of allegedly Australian cars, even recently, have focused on ICE sedans hasn't helped, though that presumably ties in with the nostalgia aspect for potential consumers of those types of vehicles.

The Monthly published[1] an exquisitely written article middle of last year, describing the history of the Australian car industry, and the self-sabotage exhibited. It's a depressingly sober read.

[1] https://www.themonthly.com.au/issue/2016/may/1462024800/rich...


I was reading a piece lamenting that Australia was leaving a club of only "8 other nations" where a car could go all the way from conception to mass manufacture. I will track the source down precisely if anyone expresses interest. So I started mentally listing the 8 countries: US, Japan, Germany, South Korea, China, UK, France, Italy. But surely also Sweden? India? Brazil? Spain? Eight seems low to me.


- Sweden: Volvo is Chinese-owned now and Saab is gone, I think, at least for now.

- Spain: Is there anything other than SEAT, which is part of VW?

- Brazil: I think they assemble a lot of cars, but I don't think I've heard of a local company, despite there being an Brazilian aircraft maker.

OTOH, Tata Motors Cars would make India count, right?


Sweden is the smallest nation in the world still doing end-to-end car manufacturing. Australia was the second smallest.

The difference is Sweden sells cars all over the world, and in Australia despite decades of attempts and popular Top Gear segments they could never convince anybody else to buy an Australian car


No, GM did successfully sell Holden Commodores in the US (as Chevrolets). And Aussie cars have always been popular here in New Zealand.


I think a few went to NZ?


Foreign ownership doesn't disqualify since Australia was in the club until yesterday. I admit Brazil was a stretch on my part (basically I thought Brazil should be a member without any precise knowledge of how they're a member)


Malaysia probably also qualifies, although the local cars (Proton, Perodua) are crap.


Proton, at least, was exclusively a purveyor of badge engineered cars up until pretty recently.


Spain has SEAT, Renault, Citröen, Ford, URO (Urovesa, they are in between of mass production and a specialized manufacturer) at least. The only one being Spanish is URO.


Russia


We asssule that protectionism is bad because the consumer has to pay a higher price when those goods are not optimally produced. The irony is that less local consumption = less local labor, reducing competition for labor and pushing down pricing power. But the second aspect of this that doesn’t often get talked about is quality. If making a 65” TV in the US is going to cost twice as much as when it’s made in China then I as the consumer will just by a cheaper TV — probably spending the same amount of money I would have. We can often buy cheaper substitutes with the same functional properties.


Another great story from NYT in a similar vein that does a great job (I think) of humanizing all of the people involved: https://www.nytimes.com/2017/10/14/us/union-jobs-mexico-rexn...

This is a tough issue for me because I consider myself a liberal, and in theory I am OK with globalization but it obviously has negatively impacted many economies in similar ways.

I want to be pro-globalization but to me you really only have two (vastly simplified) options:

1. Be more isolationist or micromanage global trade to maintain your own industries even though they can't compete globally. 2. Find a way to make globalization benefit everyone, not just the owners of companies who can cut costs and increase profits. This most likely means some kind of universal income and large education investment and vocational training built on top of the profits of globalization.

We appear to be moving towards #1 and I'm afraid we'll all suffer as a result.

My biggest issue with globalization is that, while it makes sense in theory, in practice most of the "efficiencies" come from dirt cheap labor due to exchange rates, poor workers rights and working conditions, and lack of environmental regulations (among others). Not because other countries have developed better ways to make things better or faster, they can just abuse their workers in a way they can't here. You would think we would all benefit in some ways even if we're just consumers by cheaper goods, but are they really cheaper or cheap enough to offset the reduction in good jobs? Does anyone know of some good data-sources for the prices of consumer goods vs household income over time? My guess is our purchasing power has gone down in general for the middle-class.

I can see honestly how this issue has given rise to nationalism in America, I somehow hoped that people would see that isolationism is not the answer and we instead need to rethink our economic model. Somehow Americans have been sold (among many other things) that something like universal income is a handout. I'm afraid we'll take the route that the UK is moving towards of being poorer overall and reducing globalization out of spite without it actually benefiting us.

I feel like as a liberal in America I live in a game of political jenga. Want to stop abortions? We can only do it in a way that doesn't involve decent sex ed or contraceptives (which leads to personal responsibility). Want to prevent gun massacres? We can only do it in a way that doesn't restrict access to guns at all and doesn't cost any money (which leads to more personal responsibility). Want to help out those impacted by globalization or those who have never been on sound economic footing? We can only do that in ways that don't involve wealth redistribution (which pretty much means personal responsibility of people to despite the fact that that already happens in many ways (so we're left with more personal responsibility and people like Shannon are responsible for a late-in-life pivot to a new job with anemic vocational assistance).

A lot of the people that have been hurt by globalization are the same people that support the party in our system that has taken most of the solutions to our problems totally of the table. We're in a straightjacket and could get out any of 10 ways but those would involve tools, all of which are (claimed to be) morally/philosophically unacceptable.

I know this was a rant but its been stewing since I read the first NYT article and this one just compounds it.


Don't take this the wrong way, but I think a more accurate description of your politics might be something like "an economic nationalist" instead of a liberal.

By any global metric you look at globalization is doing amazingly. "A U.N. goal to halve the poverty rate in the developing world between 1990 and 2015 was nearly achieved twice over."[1].

The whole process of relaxing limitations on trade has been a huge boost for developing countries who are currently on a runaway growth trajectory. E.g. look at the GDP growth graphs for the developed v.s. developing world in this[2] article.

Yes we could do better, but it's already great. Yes as some jobs move to developing countries people in developed countries are temporarily displaced, but there's no suggestion that we can't continually recover from that situation.

After all our societies aren't overflowing with jobless ex-steelworkers, ex-textile workers or any other industry you might want to name which has predominantly moved abroad.

Instead we continue to lead the charge in economic development, but because of globalization we're increasingly dragging the rest of the world with us.

1. https://www.brookings.edu/blog/up-front/2016/01/20/the-globa...

2. https://oneinabillionblog.com/energy/energy-policy/a-common-...


I might not have represented myself that well, I'm trying more to address the people who are affected domestically. I'm not arguing against globalization at all (with words or votes) but we're seeing an increasing gap between the haves and have nots domestically and that divide is, I'm afraid, going to rip our country apart (and others, since it seems to be happening everywhere to some extent but the US has a weaker and weakening social safety net).

I don't see any way to micromanage the economy and to pull away from the world and have it actually benefit us, I might not have made clear that I don't consider that to be an actual option. I think its nuts that increasing taxes on those who benefit massively from globalization is a total non-starter and might lead us to disaster. In fact, we're about to potentially slash taxes on those same people and cut services to the rest of the country, we're moving totally backwards and the divide is just going to get larger.

So on the one hand, people losing their jobs is a shame but I wouldn't reorient our entire economy just to make sure people can still have factory jobs, but at the same time its up to us as a society whether or not simply losing your job because of changes in the global marketplace is a life-altering disaster or simply something we all deal with together.


The word ‘liberal’ these days have two purposes, the latter of which is to say you are a man of virtue.


Automation probably eleminated most of the jobs. Globalization just removed the few remaining jobs.

In the US you don't need universal income. Universal healthcare and free education would be massive wealth redistribution programs.

In fact, the ACA (ObamaCare) for all it's flaws still is a wealth redistribution program.

So if you fix your political system, it could happen...


Agreed, for that matter a progressive tax system and government services are a wealth redistribution system (which is why its so insulting and infuriating when the right says "thats wealth redistribution!!" when any solution is proposed.


Globalization is definitely a challenge but #1 isn't a long term solution either. Even in the US, companies moved from Detroit to Kentucky just for cheaper labor. The other point is that these jobs would have been automated even quicker if it were not for globalization. Look at how much automated welding happens on these assembly lines even 10 or 20 years ago.

I agree we don't yet have a good plan on how to give people access good jobs globally. I think it is just going to be a challenge until we can get automation to a really high level and power costs super low with solar so things don't really cost. Then UBI and service jobs (if you want them) might work. Very interesting to contemplate though..


Agreed, I realize now it seems like I think its an actual solution, I think it is what some people think is a solution but I don't think it will actually work. The only solution I see is a stronger social safety net that can allow the entire population to be more flexible and respond to changes in the workforce. As it is, if you happen to pick the wrong job in the wrong part of the country, you could invest a lot in something you have no control over when it leaves.

That being said, people also need to get over the idea of having a forver factory job, I understand and empathize with people who suffer as a result but culturally we've got to get over it and take care of each other and move on (I think).


It's a class thing. Working class people say why can't my government protect my and my friends and my town's livelihoods? Middle class people say, why can't my government make my disposable consumer tat cheaper? That's why we have revolutions.

Globalisation is not OK because arbitrage of cost of living, regulations, etc. The solution is tarriffs to even it out. Want to ship the factory overseas? OK, but there will be no financial advantage in it because the profits will be taxed away and the price will end up the same anyway. That's fair.


Possibly, but how do you handle that many variables and predict the outcome?

This seemed to be the point of the TPP, whether it was flawed or not, to set some kind of standards that would allow us to compete on a more level playing field.

Theoretically I think it is expected that things will level out eventually, as a nation like China has a economic revolution the people become wealthier and eventually they aren't a cheap manufacturing solution anymore and factories move somewhere else and so on and so forth. That is why I feel like taking some of the profits from globalization and investing them into a) our own people and b) environmental and human rights in the countries we do business is the best, least wasteful solution that doesn't assume we can solve an NP-Complete problem in polynomial time.


Some facts not mentioned by the news article:

1. Australian federal and state government spent billions to save the car industry. AUD$2.7 billion tax payer's hard earned $ was spent between 2001-2013.

2. Unions asked for huge pay rises every single year. For example, in 2011, they forced car manufacturers to provide 18.3% pay rise in 3 years, that is 6% a year non-stop for 3 years.

3. Car makers were forced to continue to provide pay rises when they were weighting the decision whether to shut down their production in Australia.

Take a look at the following The Australian article, you'd probably feel happy that you don't have such unions screwing local economy in your country.

http://www.theaustralian.com.au/national-affairs/pay-rises-a...

Australian is an unique country, a ticket inspector makes $100k AUD a year ($80K USD) from his/her unskilled job. With such background in mind, it is not hard to imagine how much you need to pay those workers to build cars.


Fun fact: The Chevy Bolt was designed at the Holden plant, kind of poetic that they designed an EV as the industry here came to a close.


And it was never sold in Australia :(


Holden (GM) killed themself by building cars no one wanted anymore as the Australian iconic car has 6-cylinder engines and some maybe 8 cylinder.

Australian government couldn't subsidise cars that where losing sales year on year to smaller cheaper to run cars.

GM just wanted the handouts to keep it running when that dry up they pull the pin

John Cadogan is a bloke that called the end of the Australian Car Manufacturing many years ago and has a great video on why it died here. https://www.youtube.com/watch?v=_uFYW5tMoeg


Not all Australians. I'm glad my taxes won't be used to prop up yet another company that's "too big to fail".


Just remember that at its height, Australia had at least 5 car manufacturer. We had Nissan, Chrysler, Mitsubishi, Ford, Toyota and Ford. Now we have nothing.

I was with a Tier 1 supplier in Australia before transferring to Germany, the market place is so different. Looking back, it's a wonder that it actually lasted this long.


I've always wanted a Holden Ute. Shame they couldn't find a way to keep it in Australia.


> Ute

oh god why?


What is fun is how if there is an oversupply of say lithium, the demand for electric cars can restore demand. If the dollar collapses though for example, it will take until car loans are restored before there are any demand.


The Chevy SS is a great car for the price, but most people in the US would mistake it for an Impala. In California I think the reputation of a car is more important than the actual performance.


Which is logical, because traffic here is so bad that regardless of how powerful your car is you can't drive any faster than the jerk hogging the road in front of you. So why pay more for a Chevy SS?


Where is "here" for you? California is a big state, and outside some major cities traffic is not the issue you make it out to be. CA also has world class roads for enthusiasts.


Along with mostly great weather that doesn't rust cars and regulations that allow lane splitting for motorcycles.


It’s supposed to be a low profile vehicle


That's why they sell it in orange and purple paint..?


Interesting to see how much was expensive energy costs.

Australia has tonnes of gas but unlike USA has not transformed that to cheap energy and the industries that come with it.


They were just seriously bad cars with a poor reputation and worse resale value.

It got to the stage where when buying cars, people I knew would check the VINs to ensure that they were not made in Australia.

Fords made in Australia were particularly bad. Toyotas made in Australia were not up to the standards of the Japanese built Toyotas, but were far better than the pieces of rubbish turned out by the Australian subsidaries of American firms.

Driving one of the US branded cars, was like having a big sign saying " I am a bogan"

Australian slang for chav / redneck


A changing taste, competition from European cars and more disposable income is what killed this off. They’re really fun cars I will miss them.


> said it was the workers over 50 that were particularly struggling to find new employment

I always think it should say - there are some workers who've been cruising for 30 or so years and picking up a pay packet without reskilling. They probably won't be able to get a job without spending a bit of time learning some marketable skills


Can we at least get a [paywall] tag on these posts?

Edit: Down votes. Really? I give up.


The downvotes are presumably because the community doesn't like repetitiveness in comments. It's a topic that's been discussed to death and the community consensus is well-established: as there's a workaround to the paywall, it's a legit submission. No big deal.

I'd expect a polite request for help getting around the paywall probably would've been much more warmly received.



What does "atleast" mean in this context? What else would metadata you like the submissions to have?


Right click, 'Copy link address', ctrl-shift-N, ctrl-L, ctrl-V, enter.

Make sure to ctrl-W when you're done.


Thanks.


It's not paywalled. Just turn on cookies.


I don't turn off cookies.


In the many years the NYT has had its most recent firewall I have never been blocked. My secret:

Firefox: clear history when Firefox closes (including clearing cookies and cache). Also NoScript: no JS allowed on NYT website

For real laughs, an earlier incarnation of NYT paywall allowed access to everything except for the editorials. Wow. Talk about tone deaf. If there's anything from the NYT I would pay for it would be to block all their editorials.




Guidelines | FAQ | Lists | API | Security | Legal | Apply to YC | Contact

Search: