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The Forum > Article Comments > Mine the gap > Comments

Mine the gap : Comments

By Andrew Leigh, published 29/7/2011

We should expect that the splash in mining cash will go to the few, not the many.

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Andrew. A reasonable analysis on the face of it, but aren't you forgetting how the wealth generated by the mining companies is spread through the economy?

Take government receipts for example. Mining companies pay royalties (7.5% of revenue for iron ore in WA for example), corporate tax of 30% on profits, payroll tax. Their employees pay income tax, and GST on their purchases. Their suppliers pay corporate tax, payroll tax and there are GST revenues. The suppliers employees pay income tax, and GST. It would be interesting to see what percentage of mining company revenue ends up in government hands.

Capex means employment of engineers, draftsmen, and bureaucrats to vet and review the plans. It also means business for forging shops, fabrication shops and the like.

The employees of mining companies are spending money on all kinds of stuff, generating retail sales and employment (cleaners, gardeners, motor mechanics, plumbers, electricians etc).

My point is that much of the wealth is actually spread through the economy to the benefit of all.

To put it in another context. Imagine Australia WITHOUT a mining industry. What would it look like? How prosperous would we all be?

Of course there are inequalities and those who may not benefit. But people have choices, and some of those choices involve making decisions to benefit from the prosperity of the mining industry.
Posted by Herbert Stencil, Friday, 29 July 2011 8:57:45 AM
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Yet another rationalisation for stealing from the productive sector to distribute to the non-productive sector (which includes left-wing academics turned politicians).
Posted by DavidL, Friday, 29 July 2011 9:51:58 AM
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DavidL,
have you ever wondered why the leftie academics have pushed education before trade apprenticeships ? Because in Unis you can indoctrinate young people, in a trade you can't because apprentices need to think to get through.
You'll never get a sensible realistic view from someone who is not brought up to put in some effort & exercise & some responsibility.
It's a mentality thing that needs throwing out.
Posted by individual, Saturday, 30 July 2011 1:44:21 PM
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The Gini index shows Australia in the upper proportion for income distribution, although Australias may be getting better in time.

http://en.wikipedia.org/wiki/File:Gini_since_WWII.svg

There are some countries (eg US) that seem to be getting worse in time, which could be attributed to globalisation.

Maybe/maybe not, although globalisation could be exposing more countries to greater risk.

It is questionable that workers in the mines are profiting that much. They may earn high incomes, but many are also paying high real estate prices.

What is noticeable in the Burdekin coal mine basin is the number of billboards beside the roads advertising family law solicitors.

In our feminist society, if a miner earns $150,000 + for a number of years, they can very quickly lose that to such solicitors.
Posted by vanna, Saturday, 30 July 2011 4:02:53 PM
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