yes, govt can be crucial to innovation.

Look at US military. Its air force was instrumental in cleaner fuel aim as private sector was reluctant to bear cost. Now many private companies work with air force towards such a goal.

*With some effort, the education department could have formed teams of Australian companies to develope that software and kept the $500 million in the country*

Vanna, you miss the point here. The Govt would have been negligent
in its duty, to risk 500 million $ on an experiment. If it went
wrong, taxpayers would have been left with the bill and the
disaster.

You might think it was a good idea, but clearly there was no
entrepreneur or company, willing to risk capital, willing to risk
hiring the labour force, that might or might not deliver the
goods.

If the German company has a trusted record in doing similar projects,
why risk taxpayers funds?

In all these ventures, somebody has to risk their money, so its
a question of bringing together innovative skills, venture capital,
labour
and drive-determination to create something.

As Pericles pointed out, create the environment for those things,
the entrepreneurs will follow. Otherwise they simply won't bother.

A willing workforce helps. In Australia that is a problem. People
have little company loyalty and will flit to the next job if it
pays a bit more, alot of focus is on bells and whistles entitlements,
given that we have close to full employment in this country.

So in Australia entrepreneurs focus on areas, where there is a
comparitive advantage,with much less risk. Develop some real estate
for the increasing population, or develop a mining venture, as
we have abundant minerals.

Wrong question Chris.

What I would like to know is, does Australia have a plan A.

We really only need a plan B, once we have some sort of plan to start with.

Yabby,
In terms of software, Microsoft started in a gargage with two people.

The education system is completely and totally hopeless. After 40 years of teaching computing, they then import all their computer software and hardware from another country.

The continuous amount of money leaving the country each day in the form of imports not only represents a loss of cash, it also represents a loss of intelectual property and intellectual capital, because most productivity and intelligence is being developed elsewhere.

If the money runs out, we are not only in debt, but we also have not developed our intellectual capital and productivity.

Vanna, anyone in Australia who thinks they have the talent, can
develop software and market it globally.

In fact I gather some software is developed here, MYOB, quite
a bit of farm software, various games, etc. Its a free and open
market.

If not enough is being developed for your liking, then clearly
we don't have the talent, nor the entrepreneurial drive to
do it.

I see no reason why Australian institutions or businesses, should
be forced to buy Australian software, just because its Australian.

Yes, money goes out, but money in competitve industries is also
coming in. Our trade balance is in fact in surplus, not so with
our current account, as we don't save enough, but are the worlds
biggest gamblers.

Yabby,

The trade deficit is where it is because of coal exports. Without coal exports the country would be bankrupt.

Look around you and see how much has been produced inside the country.

Innovation occurs when one thing builds from another. The education system is the opposite. It just uses taxpayer money to import, it does not build anything, and stimulates no innovation.

The idea that other countries are ahead because of low wages is a red herring. I can imagine if someone in China used the country's money to import 100's of millions of yen worth of goods from another country, and did not spend anything on local Chinese companies.

I don't think they would ever be released from jail, but in Australia is is common practice to use taxpayer funding to import.

There is much more to it than low wages, and having government departments and education systems working for the country (and not against it) would be a big help.