Monday, 20 May 2013


The cost to the nation of losses in manufacturing has been greater than the losses in agriculture but the visual impact is less than seeing trees being bulldozes because it is represented  by fewer cars in work place car parks and locked gates at former work shops.

One definition of a Developed Country is shown in Wikipedia as "a post industrial country" which  implies that Developed Country can never be able (by some undefined force) to reverse the downward trend in what Lance Endesbee referred to as Production. Lance showed the stark difference in the Production percentages of GDP between Developing and Developing countries as shown in the columns shown below. To the credit of the United States they appear to be developing technologies to achieve a "bounce" in the percentage of Production. Europe and Japan do not appear to be making any positive moves. The challenge for Australia (and especially to politicians) is that I cannot see any visionaries such as Lance Endersbee on the horizon. The question we all should be asking  is whether we accept the contention of the economist who I talked to who sees Australia's contribution to the World Economic Order as a quarry but not as a manufacturing country. The economist argues that only countries with huge populations can support strong  manufacturing. His comment was that whatever manufacturing we have in the future should have a  minimal labour component due to Australia's high wages. His examples includes a niche aircraft manufacturer and people producing world accepted animation  technology for film and video. My contention is that each of these would have to grow about 1,000% to have the impact which would be required to bring our Production percentage of GDP up to 30%.

After talking to the economist a newspaper headline appeared later advising "Aero Jobs in Free Fall." The article advised that the company had survived only because it is now controlled by an Asian company. That company has chosen to look elsewhere (in Asia?) for manufacture of the nest version of the aircraft. Refer to "Are we missing out on the Asian Century.  

If this web site does nothing else it would be great if it can generate discussion on this subject.
From a theoretical point of view it would be appreciated to have an assessment by a different economist from the  one with whom I argued.

My wish is that two economists could debate these issues. My last economics lesson was from Mr. Frank Taylor at Griffith High School in 1948 but I would welcome a debate with the economist from Monash University
From a practical view it would be great to see green shoots appearing somewhere. Could it be the very innovative and financially aware manufacturer in Morwell, Victoria with whom I worked?
Could it be Kwinana where we founded Kwinana Entereprises Pty Ltd in 1968 and did many magnificent things?
Could it be Port Kembla  where I did my apprenticeship and engineering?
Could it be Port Hedland where I lived in a construction donga many decades ago? If agriculture is going to sprout in the North why not have manufacturing sprout in the North? Many, many decades ago during Australia's manufacturing high point there was a proposal to develop a direct reduction HiMet Plant. The budget was exactly $100m. A very good friend of mine who was an excellent estimator told me that he felt that the estimate was too low. I am no longer quite as keen to call him a friend because he worked all week on his own time and produced a very detailed estimate totaling $105m. They scrapped the plan.
Way back then I wondered what would have happened if they has gone ahead with a target of $100m. My job was to control time schedules and be associated with the cost controllers. What if the cost had blown out by 10% and hit $110m? I would have done my darndest to justify any schedule and cost over runs. .
I will be sending this web address to Post Offices in Kwinana, Port Hedland and Wickham and hope that a miracle might occur.

I discussed these graphs with the economist

The first four columns on the left were copied from a DVD by the late Lance Endersbee while the heading and the two columns on the right hand side are mine. When I saw the DVD in 2011 I did not want to believe it. I phoned ABARE and was devastated to learn that they assessed that Australian agriculture had reduced to 2% of GDP and what Lance referred to as Production had reduced to 26% of GDP. I have asked the Senate Inquiry into citrus to advise their estimate for agriculture in 2013. I will be asking Darren Chester the Federal member for Gippsland to obtain a figure for Production and/or manufacturing.

The editor of "The Area News" is very realistic. He allows weak economic outlook for agriculture to be presented so that improvements can be initiated. The editor of the LatrobeValley Espress prints only good news so the following letter will not appear in print:



From:Jeremy Beck ( sender is in yourcontact list.
Sent:Monday, 13 May 2013 9:13:37 AM

What is the local situation in Morwell?
A friend works in a factory which lost $200,000 last year and $200,000 the year before. We dsperately want to try to persuade The Latrobe Valley Express and Darren Chester to save yet another Australian industry to die because of the ever decreasing tariffs in the New World Order of Univeral Free Trade.
A design engineer tells of having a staff of over 30 including apprentices diving down to a staff of 6 with no apprentices. He has joined with us prevent his  part of the manufacturing industry disappearing for ever.
Yesterday (13th May 2013) he told of a bank teller saying that customers had dropped by more then half. Her answer to his question was "lack of business."  How can there be business when the manufacturing base of the economy is imploding?

Only ten years ago  steel structures in Australia were designed and manufactured in Australia. As tariffs have reduced I have seen a construction site in NSW where steel structures and equipment were imported from India and so much of the structures and key equiupment items were unacceptable and had to replaced with disasterous results on the project schedule.
On another project piping imported from China required replacement with project schedule delays..

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