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Australian Boom and Bust Capitalism


Both cheeks of the Australian political backside (to use the imagery so very aptly applied to British politics by George Galloway), with the Greens wedged firmly between them, are falling over themselves in their efforts to impress the Australian public with their grand schemes to “take maximum advantage of the current Mining Boom”. Aside from the explicit acknowledgement that it is just that – a “boom” – there is the tacit acknowledgement that sooner or later there will also follow a “bust”, and the even worse acknowledgement that a cycle of boom and bust is generally regarded as a perfectly acceptable way to manage the nation’s economy.

The Irony of The Real History

Lost in the froth and bubble of Australian “public discussion”, or in fact, entirely unseen, is the beautiful irony that by far the best way to “take advantage of Australia’s current mining boom” would have been to have borrowed $4bn in 1975 from one of the oil-rich Arab states and use those funds to buy back a controlling interest in the nation’s mineral resources, which should never have been sold off in the first place. The nation has completely forgotten that this is exactly what the Whitlam government wanted to do in 1975 and were so viciously berated for it.

The national collective memory has also apparently lost all reference to the course of events that prevented this and precipitated the demise of the Whitlam government.  To sum this up in one paragraph or less, this was a coup, not a military coup, although, as acknowledged by former PM Robert James Hawke, the military was waiting in the background in case it all went “pear-shaped”, but rather, a multi-pronged attack on democracy by the usual players – The US, the CIA and The People Who Own Western Capitalism, with the complicity of various Australian organisations and individuals whose involvement was nothing less than treasonous.

For three years the Whitlam government sustained a constant barrage of denigrating media disinformation, particularly from the empire owned by Rupert Murdoch who now lives where he belongs. A typical (in this case racist) tabloid headline of the time was “Gov’t to Borrow $4bn from ARABS”. General Motors and Ford motor companies each repatriated $0.5bn in profits, effectively blood-letting the Australian economy, which the media, far from truthfully communicating the implications to the Australian public, misrepresented it to the detriment of the government.

This was legal, even if unscrupulous, but the action of Malcolm Fraser, as PM, after Whitlam was deposed, in first devaluing the AUD by 17% and then re-valuing by 15% a week later provided ideal opportunity for those funds to be returned at great profit (had people been in the know) and deserved much better public scrutiny. The treasonous behaviour of the Australian secret services is glimpsed in the Attorney General’s attempted raid on ASIO Melbourne headquarters (foiled by media) and the Governor General (cur’s Kerr), whose background included involvement in CIA front organisations, entertaining members of the CIA at Yarralumla in the lead-up to his outrageous act of dismissing a government that had been twice endorsed by the democratic will of the people in the previous three years. Lest we forget that the people who now own the Australian economy bought it with cheaply borrowed petro-dollars and that Australian troops are currently sacrificing their lives to preserve that privileged access to ARAB oil and wealth.

The Tragedy of the Real Economy

The Mining Boom has created a dramatic rise in the value of the Australian Dollar. In the late 1990s the AUD slumped to as low as 40 US cents but today is trading at over $1US. The occurrence of currency fluctuations like this, in a world in which incomprehensible sums are being spent on violence in the name of economic stability while the life sacrifice accounts in millions (if we bother to count) is outrageous. These indicators of boom and bust mentality in the attitude and practice of our political/economic situation reveal some of the true cost of media censorship which “negates rational risk management and hence endangers public health and safety” (see Gideon Polya -

The currently high AUD, arising from the Mining Boom, has and will continue to devastate every other aspect of the Australian economy. The “Lonely Planet Guide” for example, recently closed up shop and moved to the UK, leaving 45 more Australians unemployed, directly as a result of the high dollar.

In 2003/04, the tourism industry represented 3.9% of Australia's GDP at a value of approximately A$32 billion to the national economy. While the devastation of Australian tourism is extremely evident to anyone who lives in proximity to a tourism-dependent location (the empty restaurants and accommodation, the quiet streets, the infrequent sighting of tour operators’ vehicles etc.), the subject appears to be taboo in the press. The published advice to tourism operators of Sydney MP, Joe Hockey that “A high Australian dollar should be viewed as an opportunity." are of course, an exception – such is the art of spin.

In October 2010 the Australian Tourism Export Council made the absurd assertion that “a high Australian dollar will not be a deterrent for inbound tourism industry of Australia”, which was, of course taken up by the media. However, a Northern Territory tourism industry group says operators are bracing for a slow peak season because of the increasing value of the Australian dollar and a survey of Australia's tourism operators released in March 2011 found nearly 90% said the high Australian dollar will hurt their business.

But it’s not only tourism that is affected by the high dollar; all of Australia’s exports are affected; of course they are!. A rich and diverse ecology of small and large businesses is suffering the consequences of a severe distortion of the national economy in one sector and the damage could be long-term. In the absence of any controlling interest in the mining sector (which need not have been the case), and given that the elected Prime Minister can be ousted simply for having proposed a mining tax it’s clear that the government is hamstrung against taking any corrective measures.

Everything turns on how long the mining boom (foundation of the nation’s economic hopes) lasts and that all depends on the Chinese economy. The Sydney Morning Herald reports that “while the new secretary of the Treasury, Dr Martin Parkinson, acknowledges the risks facing China's economy, his ‘'central scenario' is that commodity prices and the Aussie will stay high for a long time” (i.e. his “Central Scenario” is empty reassurance).

A layman’s assessment of what’s happening with the Chinese economy is not difficult. The People Who Own Western Capitalism have clearly made some sort of secure agreement with the Chinese government that allows them to exploit an enormous, low-cost labour-force. The deal clearly involves some agreement to invest a balance of payments surplus back into the US. This arrangement serves at least three benefits to The People Who Own Western Capitalism;

  • China has become a source of vast borrowing capacity and, as these borrowings are spent on military adventures and bailouts the public debt is systematically transferred directly into the coffers of private companies (owned by The People Who Own Western Capitalism) and wealthy elites.
  • The US government will be brought more into line with many other countries whose governments have been subjugated by debt – the end of political power.
  • The US middle-class is eroded, the work force displaced and impoverished and the military will increasingly become the only source of employment for much of the less educated work force, facilitating the use of the US as a source of military might to be deployed as a boot on the neck of occupied countries in the service of The People Who Own Western Capitalism, as has been essentially the case already for more than half a century.

The establishment and growth of the Chinese economy has been founded on the export of cheaply manufactured consumer goods into western markets, replacing supplies that formerly were produced by their own manufacturing sector by the same companies. As there is no longer a revenue source from manufacture, these markets are living on borrowed money and borrowed time. When all remaining assets are sold and the credit runs out, so will time. Obviously, the hope of The People Who Own Western Capitalism is that by this time (a time that will see the near complete subjugation of the populations of western capitalist countries – i.e. economically powerless) the Chinese economy will be self-perpetuating (i.e. selling sufficiently into its own and other growing markets) but owned and controlled by The People Who Own Western Capitalism with their interests secured by the US military machine.

However this unfolds, there will be a changing down of gears and the inevitable decline in the value of the Australian dollar will quickly follow. Speculation will ensure that the dollar falls to a value significantly below its “true” value for a time before recovering to a point somewhere near it. But during this lower than true value phase, borrowed foreign capital will be used to buy up the suffering businesses and other cheap assets before there can be any recovery, thereby concluding the transition to near complete foreign ownership of the Australian Economy, leaving the 23 million population as tenants in their own country.

A Different World is Possible

While it superficially appears that the views expressed here are nation-centric or even ego-centric with a myopic desire for even more material affluence for Australians, this is far from the case. Australians are already far more affluent than most people in the world, such as, for instance, the Chinese whose industry is currently the engine driving the Australian Mining Boom.

Many Australians are clearly concerned about issues threatening the wider world such as Climate Change, otherwise it would not be possible for the current government to contemplate a Carbon Tax. Almost certainly, the government’s designs for the tax revenue differ significantly from the public who support the tax, but the tax clearly represents an attempt, albeit clumsy, to address the issue of carbon emissions.

Had the nation taken control of our own mineral resources (and defence) in the mid-1970s, as was intended, Australia might have played a very different role in the world today, emerging as a truly independent nation and a force for the better in the world, potentially leading the way in releasing humanity from the tired and barren prejudices of old-world hatefulness, arrogance, racism, illusions of supremacy and the destructive obsession of Capitalism with wasteful production and consumption.

Rather than being relinquished to the psychopathic cabal of criminals who own western capitalism, to fund endless war and violence and the slaughter of innocents, the revenues from our resources might have been used to fund the necessary, direct structural changes to our cities and national infrastructure to achieve radically increased energy efficiency, drastically reduce energy consumption and carbon emissions and contribute to reduction of atmospheric CO2 in the following ways:

  • Ending the notion of a driveway, street and main road serving the access of multiple motor vehicles to every house,
  • pedestrianizing local areas, servicing them with shared, central car parks and providing  convenient access to clean, reliable and efficient public transport
  • Shifting long distance goods transport from road to more energy efficient rail
  • Rolling back suburban sprawl, making cities more compact and planting out fast-growing tree species in the spaces released from vehicle usage
  • Shifting to renewable energy sources wherever possible
  • Expanding water storage and pipeline distribution facilities rather than moving to the high-energy-consuming desalination as a means to reliable water supply
  • Facilitating greater emphasis on shared community lifestyles
  • Designing and implementing more compact, energy-efficient architecture.

Still further, control of our mining resources would have enabled the development of more cooperative and trustful relationships with our trading partners facilitating their development in the course of a more responsible, less virulent capitalism that is more energy efficient and less consumption focused, having led by example and obtained the experience necessary as a basis to advise and facilitate.

A different world is not only possible, it will soon be absolutely necessary, if humanity is to survive. The sooner we accept this and make the change the better. A good first step would be to break out of the addiction to boom and bust capitalism and this would require a courageous government willing to face down the corrupt corporate media and the People Who Own Western Capitalism to take back control of the nation’s political and economic system and achieve true democratic independence. This would require the establishment of a trustful bond between the ruling and working classes, a narrowing of the wealth gap, an end to the politics of greed and a softening of the class war in the name of a more egalitarian and socially responsible society that is the alleged core of Australian Values. Such are the foolish dreams of idealistic optimism, something far preferable to the foolish denial of the inevitable.

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