What a peculiar argument.
We have to empty the bucket, so future generations can empty the bucket, so their future generations can empty the bucket...
I think I see a flaw in this logic.

Well said Greg. I emphatically agree that the Australian mining industry has a strong future, not just in the extraction of minerals, but also in the further development of the world leading position in mining services that our industry has supported. Notwithstanding, however, the industry is cyclical, and it does make sense to diversify our economy, generate strong new businesses (like Cochlear and CSL) that provide jobs, growth, tax revenues etc.

Unfortunately, we have a government that has no idea how to do that. For example, just the other day Ms Gillard said in her speech to the UN: “Australia’s economy today is less reliant on our natural resources and our mining boom than you might believe,” her speech announced. “In the next four years, we expect three times as many new jobs to be created in healthcare, social assistance, education and training as will be created in mining.”

What she, and Christine Milne, clearly fail to understand is that new jobs are created by entrepreneurs building new businesses. Not by putting more folk on the public payroll.

Luke Johnson in the FT had a useful comment the other day: "What can be done to create more entrepreneurs – and hence more jobs. We all know this is the way for the private sector to revive, generate taxes to pay down debt, and get our economies growing again. The answers to these challenges are straightforward and well known. We need less red tape stifling business, more early-stage funding, and more mentors. Above all, more people need to start a business. That is really it."

The fact is that too few of our politicians, even on the Coalition side, have ever established and run a business, and so have no idea what it takes, and what policies are needed

Greg you have missed two minor points, firstly you need cheap energy to undertake exploration, development, extraction and transport to markets, we no longer have this option.

Secondly you need lots of capital (usually as credit/debt).

I think that the world has been using growing credit to backstop a lack of real productive growth in the western world for longer than 25 years. We've used up our time badly.

A credit expansion inevitably unwinds, there are ominous signs the expansion is over. This is an analysis of the facts. Things are unstable. Things have been unstable for a while now and are globally getting worse.

The fact that a "deflationary crisis" happened in 2008 was our wake up call. It was deflationary because money froze and became illiquid in the system. Something was and is now broken. It's not been fixed.

We have not been productive (i.e., earning our keep in terms of real wealth creation) for decades.

As far as fixing the global economy goes, it won't work. More and more QE has less and less impact on the economy, we're living beyond our means. That's what has given us the crisis. And it's getting worse. This is deflationary.

Given how much credit has already been created to date, and we're in even more trouble anyway, it is less than likely, more like impossible, for wanton credit creation to last much longer.

How much longer will the voters, not to mention the stock and bond markets, believe it? I don't believe any economy can continue to create unfounded credit.

Risk is terribly pervasive right now, and it's bigger than we've seen it in our lifetimes. Do with that what you will.

The latest evidence that risk is pervasive? QE3 and ECB and BoJ printing money.

These facts are based on data you and I can find if you care to look hard enough, it should be a sign to you that your entire assumption is based on fantasy rather than reality, stop worrying about digging up more dirt for a market that won't be there anyway.

Leaving aside Grim's rather odd argument, statements by enator Milne noted by the author show that despite decades of policy failure, some politicians - notably the greens - simply cannot bring themselves to learn.

Sure it would be good if Australia had a more diverse economy. We could really use more manufacturing, but despite decades of subsidies and tax breaks and blather about improving educational standards and on and on it isn't happening - why not?

The answer is that Australia has the so called dutch disease.. we have plenty of resources and developing those crowds out development of a proper manufacturing base.

If anyone can suggest sensible policies which will counteract this disease - policies which no-one else has been able to identify let alone put into effect - then they should share it with us.

Meanwhile hardly anyone amongst the people who make the decisions that will affect Earthkind altogether have any kind of vision, let alone the conceptual tools, of/for the long term future beyond our present-time generation. Everything is done on a short term basis.

This site The Long Now Foundation provides a more comprehensive vision

http://longnow.org

What should be happening before ANY of our minerals are sold over seas is that Australians "enjoy" the maximum benefit possible, that is NOT happening, and the obscene increases in electricity and gas charges reflect this, partly because CEO's are gaining ridiculous salaries that can not be justified and also the lust for "experimental" power sources by the "gang-greens" whose paranoid ranting's would have you believe that the world will come to an end unless we obey their every order.
We should be enjoying reduced power charges as the coal and gas is ours in the first place, after we have received a fair and just quota then the remaining product can be sold.

Greg, there is something major missing from this article. This is the manner in which we are using our mining wealth.

Currently, we are expanding mining at a manic rate, in order to just try and keep up the same standard of living for an ever-bigger Australian populace. We are desperately trying to increase our economic growth so that our income can match our expenses. And we are failing!

For all the massive mining activity, in absolute boom times, that we’ve had for many years, we are not balancing the books or significantly improving the lives of Australians, on average.

Our mining effort is feeding the massively expansionist and totally unsustainable mindset!

Christine Milne is right inasmuch as we need to strive for a sustainable society. This means capping the demand for everything, or at least striving to slow the rate of increase right down. And it means diversifying our economic base, and also continuing to utilise our mineral wealth.

We should be striving hard to stabilise our population. We should not be expanding mining operations, but should wind them back somewhat, at least a few years down the track.

But most importantly, we have surely got to make this amazing wealth work towards achieving a sustainable society, instead of very strongly doing just the opposite!

You just can’t meaningfully discuss the future of mining in this country without these sorts of considerations figuring very prominently.

Like the Jesuits, the Greens know everything about everything - but that's all they know. Their electoral support is far from solid because their ideas are so half baked, especially when they start talking about anything not to do with forests and dams.

Mining accounts for about 9 per cent of GDP. The resources sector is important but no more important than agriculture, live stock or the booming services industry. People seem to forget that we only mine and sell ore at the market rate. We're not giving it away. It's a pretty basic economic principle. The price mechanism works to sustain the resource.

Much anti-mine comment comes from people who use a teleological argument of final causes, eg, we'll run out of the stuff one day so we shouldn't do it, the world is finite so we shouldn't do it, we're over populated or under populated so we shouldn't do it. The other argument is basically socialism disguised as 'sustainability', eg, market capitalism (which they equate with mining) is making people poorer, fornicate more, hungrier, sadder, etc.

There is a back up argument which is used as a subsidiary crutch - and that is energy. The peak oil argument (which surely must be dead by now) is trotted out. If you bring all the different parts together you actually have more of a delusional psychological profile than a cohesive argument.

"The other argument is basically socialism disguised as 'sustainability', eg, market capitalism (which they equate with mining) is making people poorer, fornicate more, hungrier, sadder, etc." (Cheryl).

Market capitalism make us poorer? Yup, delusional.

Greece
Spain
Ireland
Italy
Portugal
UK
USA
South Africa
etc.

There but for the grace of some adroit and unappreciated financial management goes Australia.

As for mining, RFX Connor sought a sustainable Australian-owned mining industry working for the Australian nation. Panic! Can't have that! Can't wait 18 months for the election! Sack the government!

I largely agree with Grim. Albeit, I think that there is a hole in the bucket?
We need to build a sustainable strong economy, so that future generations can enjoy the things we now take for granted.
The lesson for us is the fact, we can and should mine and sell these resources ourselves, to profit ourselves much more massively, rather than offshore entities and or, the over-bloated entirely unproductive rich?
Our resources, however large, are still finite.
A case that can be mounted to use and export some of these resources, where it can be demonstrated, they lower carbon output and or, buy time to adjust and PAY FOR, a carbon neutral/free economy.
Many green advocates will demand we stop mining, but have no clear vision of how we can actually replace the incomes and or revenue these resources produce.
If their own salaries or social security depended on it, they would surely argue, we can and should explore our own Great Barrier reef, if only to see the possible mind-blowing size of the resource, we might well be locking up.
Resources that if exploited and exported by us; could easily, given the probable sheer size of the resources, earn for the national treasury, something north of one trillion PA.
And given the traditional nature of Australian liquid or gaseous hydrocarbon products, reducing carbon production, [in total,] wherever they substitute for, Much dirtier, sulphur laden, Middle East sourced Hydrocarbon products.
Sure, we should crack on building electric cars, even if that means allowing or progressing employee owned co-ops, instead of Foreign car makers, who simply fail to put Australia and our interests ahead of parent companies and countries? Waiting for them to come to the party could waste a couple of decades, our current advantages, and the probable huge export market, we could create NOW!
We lead the world in the creation of moulded and therefore mass producible, carbon fibre/acrylic products.
Carbon fibre and acrylic cars, powered by CNG powered ceramic fuel cells, [electricity,] produce mainly water vapour, and have comparable ranges, with current mass produced vehicles.
Rhrosty.

Labor always had a policy of keeping our wealth in the ground where it would do no one any good.

This secured green preferences for them, at election time.

It was only when we had competent government, that we were ready when the opportunity of a resources boom arose.

Now that we not only have Labor, but the deranged greens sharing in government we find that the mining and other industry is shutting up shop, and taking up real opportunities available elsewhere.

Of course, it is always announced that it is not because of the government, or the carbon tax., that industry and jobs are disappearing overseas, or that planned projects are deferred.

Knowing the petty minded viciousness of our government, I cannot blame the Industry participants for making these misleading announcements, to avoid retaliation.

Grim and Rhrosty, did you even read the article? Half of it was about just how damn far the bucket is from empty!

The problem we have is our tax system is out dated and can no longer keep up with demand, demand for health, education etc and, we simply have too many hanger oners to take care of, both hear and abroad.

Add this to the prolonged stay in Afganistan and whamo, we are behind the eight ball, big time.

As a result, instead of enjoying the benefits of our resources, both in real time, and for generations to come, we are now reliant on our mineral wealth as a means of survival, and the situation has not been aided by this governments mismanagement and gross waste of both our, and future generations, taxes.

Evidence being in the fact that the government is doing backflips trying to find replacement revenue to keep it's AT ANY COST budget commitment, a commitment that essentially should not have relied on with the MRRT in the first place.

The solution in my opinion is to at least try a transaction tax, whereby our money is taxed, as opposed to us personally.

After all, we personally can only spend money once, but money on the other hand gets continually circulated and, it is this continual circulation that generates the tax.

It is said that just 2% on every finacial transaction would more than replace every tax we have, including PAYG, PAY ROLL, GST and the MRRT.

As to why they won't go there is anyone's guess.

Big business and banks would be one cause.

G'day Mark,
did you read the article? All of it was about just how POTENTIALLY damn far the bucket is from empty. IOW, no one really knows for sure, but what we do know is, that the easy, lucrative and cheap resources are already accounted for.
Is anyone old enough to remember the “Beverly Hillbillies”? Old Jed struck black gold with a stray rifle shot. A comedy yes, but once resources really were that easy to find in some parts of the world.
Now we look for oil in oceans thousands of feet deep, and then dig down thousands more.
Peak Oil was never about running out of oil per se; that's No Oil. Peak Oil is about when maximum production is reached, after which production must decline.
And the price skyrockets.
Any finite resource must eventually reach such a point. It's absolutely inevitable.
The real question is, how much will these undiscovered resources cost?
Economics is about scarcity. To someone with more money than they need, prices aren't critical. The tighter your budget is, the more critical prices are.
How long before oil is a luxury most can't afford? In many parts of the world, we're already there.
How much will the children Mr Barnes is so concerned about have to pay for resources we take for granted? We've already taken houses out of reach for most.
It seems apparent many posters here just can't imagine resources becoming so scarce that most people will not be able to afford them. But consider: to my parents, not being able to afford a simple house on one wage was unimaginable.
Please understand, I'm not actually against mining. I just think this particular justification for living beyond our means is weak, to say the least.

Agreed Rehctub; a transaction tax sounds like a good move.

http://www.democrats.org.nz/OurNews/Articles/tabid/112/selectedmoduleid/548/ArticleID/156/Default.aspx

Our tax system most definitely needs a major overhaul. This comes back to the fundamental crippling problem of our 'pretend' democracy!

That is; the stranglehold that big business (including the big banks) has on government.

Without this enormous bias, I’m sure governments would be very happy to implement a much better tax system…. and to greatly reduce immigration and fully support the urgency of achieving a sustainable society.

So in the first instance, the problem is not tax reform, or the manically antisustainable momentum that our government is imposing on us, it is this all-encompassing and all-corrupting connection between vested-interest, short-term-oriented, big-donations-buys-big-decisions big business and our highly unillustrious decisionmakers!

And the big question has to be: how do we make our government independent of this pressure?

Are there any examples from anywhere in the world where a democratic government is truly democratic, or is this problem just an inherent massive flaw in all so-called democracies?

OK Grim. You've convinced me. Now what are we going to DO about it?

Rather than generalities I think we could look at specific minerals. For starters I doubt economically recoverable iron ore and bauxite are going to run out this century. Whether we have a lot of coal seems questionable if they need to dig up or under prime Hunter Valley farmland. The Chinese could take all our coal in a decade if they were serious. Some Olympic Dam copper concentrate goes to China via the Darwin railway. The Chinese extract uranium from it to power their domestic industry while we get peanuts.

However the commodity of most concern is gas be it natgas, coal seam or fracked shale gas. I think by 2030 we'll wish we hadn't exported so much of it as LNG or burned it here in baseload power stations. Gas is for peaking power, heating, ammonia based fertiliser and probably a major substitute for diesel. Note the brown coal buyout was nixed because replacement gas fired power stations while cheap to build would be too expensive to run.

If you get this analogy we're selling our last shred of dignity for a low price. With depletion we won't seem as pretty to the rest of the world and the money will stop.

Interesting article, of cause, the future of our mineral wealth, and associated benefits, lies wholly and solely in the hands of others, as while we may have the supply, it's worthless without the demand.

Furthermore, if demand slips, prices generally follow, so while we may well have plenty of untapped mineral deposits, they may well cost more to extract than they are worth.

Ludwig, The problem with our so called 'democracy' is that once one exits the polling booth, their democratic rights stay behind, as the only vote we have, is for our governments of choice, not what they choose to do with their entrusted power, not to mention their choice of leader.

A true democracy should hand more power to the people, cause after all, it's our taxes that governments are entrusted with.

As for a transaction tax, bring it on, let's at least give it a go. I would suggest a 0.5% TT for a period of say twelve months. What do we have to loose.

Off topic, but I agree with your net zero immigration, at least until we balance the books and provide decent care for our own.

It's an interesting point Taswegian makes re how much mineral resources Australia currently has.

ABARE puts brown coal at trend at about 500 years, iron ore is about 500-600 years and bauxite is 400 years. But that's just using current estimates. We have not surveyed for major new coal fields for sometime. If you're talking about natural gas, it's hard to quantify as the reserves are so large. I reckon its safer for the pink/green lobby re 'finites' to stick to fish stocks. They're on to something there.

As others have stated, we have considerable untapped resources no doubt about it.

The problem is economic, globally we now have too much debt and we are in a deflationary spiral that is growing by the day.

China's so called 'rise' in terms of their need for more minerals, particularly iron ore, is just about over.

Growth we have seen in China was the result of a direct 'political' decision, they have a new 5 year plan, and it does not demonstrate that they will need anywhere the same amount of iron ore, you can be the likes of Fortescue Metals will be gone by the end of 2013, they have the same problem as everyone else, too much debt, a dropping commodity price, a stalling market, you don't have to be a rocket scientist to see what comes next.

China will still be chasing other commodities, oil, coal, uranium, they are in the process of building 440 nuclear power stations.

Unfortunately our governments have not taken a long-term plan that takes these facts into account.

We can have all the mineral wealth on the planet but there is very little you can do if no one has the money or market for these goods.

Food for thought.

The problem for Australia and we Australians, is our current crop of visionless politicians?
Whose interests are served by locking away a resource potentially larger than all the known Middle Eastern hydrocarbon resources?
Ours or the foreign oil cartels, now reaping massive profits from captive markets. And in the process bringing down many dependant economies.
Without fuel we and almost everybody else is defenceless and in danger of starvation; given fuel is an absolute essential in both mass food production and transport!
Every human advance/liberation has been been made possible by cheap energy.
Some among us swallow the BS, that energy prices have to sky-rocket, to make alternatives possible.
This is in spite of the fact that something like oil rich algae grows like topsy, doubling its bodyweight every 24 hours, when conditions are right.
In our Northwest, a foreign company is currently exploiting algae, as a naturally occurring easily grown bio-diesel.
It needs no arable ground and can grow out in sea water!
They claim that they will soon be producing around a million litres per, for the local mining industry, plus fish and omega three?
Why, a fish farm, just the size of Eagle Farm's domestic runway, can produce as much profit as 10,000 acres of sustenance grazing!
Water is never likely to be a problem, given we are surrounded by seawater.
We can also grow things like our oil rich high protein native wisteria, which is salt, drought and frost tolerant/resistant! Utilising underground ag-pipes, wrapped in membrane, it is possible to irrigate these and myriad other crops, utilising seawater. The water pulling power of plants, replacing pumps, to create reverse osmosis!
Why, an acre of trees evaporates 3.5 times the amount of water, of an acre of open ponds!
Imagine that taking place under glass and the resultant evaporate collected as pristine drinking water, that can then be endlessly recycled for other purposes.
Good ideas which will likely gather dust, unless we can "earn" the money needed, to develop them and an endlessly sustainable future; plus survive and prosper?
Mine the reef!
Rhrosty.

OK Grim, so we've both read the article. But I still reckon you've drawn the wrong conclusion from it. The difficult thing about the inferred undiscovered resources is not the mining, but the exploration - and even expensive exploration is still only a small fraction of the total cost of mining. Wide extensions of many of Australia's most richly mineralised terranes are concealed by only quite shallow cover.

Even a fairly superficial examination of maps of Australia's mineral resources and geology tells you that the expectation of considerable further discovery is not unreasonable, indeed highly probable. The only conceivable obstacles to further discovery are political, not geological.

As Mark rightly points out, exploration costs are huge, and often return negative results.

The big problem we face now is the MRRT, as miners now face the prospect of not only risking the huge costs of exploration, but they now must part with a huge portion of their profits, should they strike the mother load.

The risks are the same, in fact higher, as costs have completely blown out, yet the rewards have been slashed. It simply makes no sense what so ever.

Now given that most mining ventures are joint ventures, with over seas interests, as a case of necessity, it is fair to assume these OS partners will look elsewhere, where the super profits don't increase the risks of this already highly risky industry.

Of cause if our government were to share the risk, as well as the gains, that would be a whole different ball game, but that makes too much sense.

The real scary part, is where we will be in another five years from now, if mining does stop, cause no doubt our government will still throw our taxes at non local issues.

Hopefully we would have thrown this lot out, but who knows.

G'day Herbert,
I think there are a number of good ideas in these posts, including your own. I would certainly support a transaction tax, although that's a little off topic.
I agree with Taswegian, that we should look at individual cases, rather than generalising.
Black coal for instance; according to the Uni of Newcastle, Peak Coal in Oz will occur sometime around 2050. NSW reserves will be exhausted by 2042.
The Pilbara iron ore reserves, the “largest in the world”, exhausted within 30 – 60 years.
Of greatest concern should be Peak Phosphorus (worldwide), estimated to occur within 30 years. No phosphorus, no food.
While these figures are certainly an argument for expanding exploration, we should take note of Geoff of Perth's arguments.
My argument is twofold. First, we need to husband our resources much more carefully, as Taswegian suggests. Second, we need to plug up the egregious hole in our 'bucket', particularly where phosphate is concerned.
We must stop pumping nutrients, and nutrient rich water out to sea.
And we need to move away from the Growth economy paradigm and start working towards a stable, or Steady State economy.

<< The big problem we face now is the MRRT, as miners now face the prospect of not only risking the huge costs of exploration, but they now must part with a huge portion of their profits, should they strike the mother load. >>

But rehctub, surely the profits from OUR mining resources need to be much better distributed to US, the people of Australia! The MRRT only goes a very small way towards correcting this chronic imbalance.

So what you are really saying is that if the more difficult deposits are developed, the returns to the general community should be piddlingly small, and the returns to a few already rich and powerful people should be absolutely enormous!

So how do we get around this problem?

How do we entice risky exploration and development while striving to break down the gap between the mega-rich and the poor-and-getting-poorer average Australian and get the best possible returns from these resources for the betterment of our whole society?

Quite simple Ludwig, buy shares.

In buying shares, either personally, or as governments, as representatives of the people, the share holders not only get a larger portion of the spoils, but they also share the risks for those ventures that don't turn a profit.

Simply putting ones hand out when strong returns are made, is like taking a bet on a race horse that gives you your money back if it fails to win.

In any case, we have royalties, which by the way, are a return on investment for the owners, us.

Now if these royalties are imbalanced, then by all means look at them, as unlike a tax, royalties can be passed on to the consumer.

At the end of the day though, laws that were in place at the beginning of any business venture, should remain the same until that venture, or phase of it is exhausted.

This is why confidence gets rocked, as nobody can plan for what governments decide they will do mid stream.

Having said this though, our mines are becoming more and more non-competitive as we speak and, therefore it is impossible to estimate peak anything if demand slows, or worst still, stops.

I would also ask, where were the people wanting their share when the price for coal was around $30 per ton, amd most mining projects, some 19 out of 20, failed.

Quite simply, nobody cared.

That's because they only want ownership rights when there is a profit to be made.

Talk about having your cake and eating it!

I think we the tax payers -and owners of our mineral wealth- are already doing more than enough.

According to the Australia Institute (Pdf PB 38)

Introduction excerpt:
“The mining industry is receiving substantial assistance from Australian taxpayers worth more
than $4 billion per year in subsidies and concessions from the Federal Government alone.
Amazingly, this is at a time when the industry is earning record profits. Significantly, the
subsidies and tax concessions set out below do not even include the cost of providing the
mining industry with infrastructure or the substantial State Government subsidies they also receive.”
Traditionally, our benevolent gov has provided dollar for dollar on some exploration projects, often resulting in major returns for the private partners and buggrall for the gov.
Also, as the article suggests, infrastructure costs (railways and ports built with public money specifically for these industries) are not included in these estimates.
Not only are we providing the keys of our vault to the robber barons, we're paying them to rob us.

Rehctub, I envisage big problems with the ‘buying shares’ approach.

Firstly, it is only those with substantial ‘surplus’ money who would be willing to invest significantly in risky mining ventures, I would think. Even if the ordinary person did invest quite a bit, they would not be making a huge return. And all those people, which would be the vast majority of the population, who are very reasonably not willing to take the risk, would get nothing!

I can’t that see this as the answer. A much better return from our mineral wealth needs to go to the government rather than directly into the pockets of investors, so that it can be put into services and infrastructure for the whole community.

.

< Not only are we providing the keys of our vault to the robber barons, we're paying them to rob us. >

Wow, it really is grim, Grim! We need to go a whole lot further than just implementing a small (and little more than tokenistic) increase in tax on mining companies!

So, Australia is full of schizophrenic politicians and CEO's who Strut their LOVE for Kids while stealing their future? Politicians who suffer mental breakdown at the dawning of this thruth , rendering them incapable of guilt while they offshore jobs, dismantle all industry and tight-fist the inevitable rising DOLE bill?

You are telling us these politicians are putting their own heads on the chopping block & we should be afraid?

Tell it to someone who cares!

If IMMIGRATION were to cease, the need for and opportunity for profit and power MAD governments like the ALP would be removed along with the current RESOURCE RAPE.

But the political Schizophrenia and short-sightedness in Canberra and the State Capitals is beyond redemption. Civil war along MultiForeigner lines will soon get rid of such morons along with 200 years of BS Anglo centric Australian history. God knows what will become of our stupid politicians. But like most real Australians HE probably doesn't care either!

INCESTTUOUS political parties - Damn them all to hell along with their gerrymandering immigrant butt-lickers!

The first thing about stone age survival was to protect the cave.
Those who invited the neighbourhood over as a method of gaining internal political power by multigenomic experiments are now EXTINCT.

Nothing has changed except the STUPIDITY of Australian Politicians who have lost touch with their own electorates so much that they have a need to import votes and make their dissaffected people pay through the nose for it as revenge.

So we need foreign capital? Why?
Almost anyone can remember Lance Hancock and the mountains of iron ore he discovered in the Pilbra?
Remember how he went cap in hand to virtually every Australian govt, for some start-up capital?
A few millions, we clearly could afford at the time.
When he had exhausted all the govts he was left with no choice but to seek foreign investors. One arrived with a letter of credit from Chase Manhattan!
What we out here in the antipodes didn't realise, Chase was technically insolvent and only saved from collapse, by 5 minutes to midnight, oil finds in Mexico.
Nonetheless the virtually worthless letter of credit, was all that was required to open up Australian banks and flood the project, with all the start up capital required.
We built the big diesel electric Wabco trucks and the walking drag lines that got many of our largest projects up and running.
We built the railway lines, and the ports that allowed these and other products, to earn billions for foreign nationals.
Wages for miners at that time, were half what our American compatriots were earning.
The point I'm making, we could have done all we did, minus the foreign nationals and their virtually worthless letter of credit, and kept our massive wealth earning resources in Australian hands, along with the many hundreds of billions they have since earned.
It's perfectly okay to make a mistake or two. This is how we learn!
But it's not okay to keep on repeating them or listening to the self serving dribble, of those who endlessly claim we need foreign capital.
What we need is a brand new peoples' bank and a credit and debit ledger; that finally works in our favour, rather than debt laden foreign speculators?
Who not only get their hands on our most profitable prospects, but expect us to service all the debt instruments created by them in the process; adding inexorably to our exponentially expanding record foreign debt, which not only deprives us of mind-blowing massive export incomes, but huge tax receipts as well!
Rhrosty.

If a 2% transaction tax would replace our current federal tax take and it could, if there were no exceptions or exclusions?
Then what do you think we could do with a 4.8% entirely unavoidable, stand alone expenditure tax?
As the only source of tax required, it would then grow with the economy rather than shrink with the tax paying demographic.
Given the entirely unavoidable nature of an entirely unavoidable stand alone expenditure tax collected via the banking system?
[In exchange for their continuing banking licences? Which by the way, is a virtual licence to print money and make massive profits.]
An entirely unavoidable system would end the need to pay compliance or any reconciliation costs!
Which currently rip out around 7% from the averaged Australian bottom line.
Given an expenditure tax would be the only tax take needed, we could repeal all the others and the endless complexity they create! Adding an averaged 30%, to the average AUSTRALIAN bottom line.
The practice of outsourcing to a subsidiary, in this or that tax haven, and creative accounting, merely to save money, would have just the opposite effect; and indeed, return the 100 billion or so we lose to too clever by half, tax avoidance.
The end of PAYE/PAYG, would add as much as 25% to averaged household disposables/savings/discretionary spending.
Fuel, tobacco, and alcohol excise, licence fees and registration, could stay, to provide seriously downsized state govts, with the GST free revenue, they would still need to manage diminished responsibilities, which logically, should not include education or health!
Rhrosty.

Yes Rhosty, we certainly do need a new tax system, as at the present rate, I doubt our current system will even go close to meeting demands.

I am not sure of the difference between a TT and a ET, but by far the most effective system would be to tax money, not people, as people can only spend money once, however money can be shifted from account to account many times over.

As for the MRRT, I am happy to agree to disagree, as we are all entitled to our opinions.

One thing I think we would all agree on, is that if mining here becomes unattractive, we will all suffer.

I wonder.
According to the stats -and speaking of shareholders- currently around 83% of all the shareholders in all the mining companies operating in Australia reside overseas.
That means, of the 51 billion dollars in mining profits, 42 billion went OS.
That's the thing about non renewable resources. That's 42 billion we'll never get back.
Fancy even considering slapping a tax on that 42 billion.
Disgusting.

Grim, I think you forgot the link.

As for OS investors, the shares are there for anyone to buy and, there's a fair chance that most OS shares are purchased by institutions, whereby the actual unit holders (share holders)) have no real say in what is bought or sold.

As for a TT I would like to see a small levy introduced, as a trial, to see just how it would work.

I always thought the natural disarster fund would have been a good example.

I read somewhere that a TT of just .02% could generate sufficient revenue to remove every other tax we currently pay.

I think a trial is a must.

But the underlying problem remains, whereby if our minerals become too expensive, what are we going to do, as we now rely on the revenue, as once we could have saved the spoils, but not anymore, especially if we see a repeat of the past five years.

What can we do?

We can stop IMMIGRATION. Its a bloody scourge on all Australians.

All immigration is doing is creating huge infrastructure cost burdens while Australian citizens are taxed more OR INVEIGLED more in poles and wires style corruptions to pay for what is essentially A politicians' immigration-for-power HARD-ON and wet dreams of infinite wealth.
The notion that our politicians are humanitarian giants via immigration programs falls flat when you look at how our citizens are being treated like 3rd worlders to keep immigrants in luxury so they will VOTE for incumbent Governments. For example all the current pollys have to do is suck up to a few shifty Imams and they get 600,000 lock-step votes. Its very dangerous and not democracy!

Adding a TT to the mix will only encourage this Pyramidal MEGALOMANIA that is like a deadly infection spreading social& environmental gangrene throughout this desert island.

The trick is to STOP immigration and consolidate our given assets and infrastructure for the benefit of those who DEPEND on this desert island for a decent standard of living.

Further, Global trade has failed because of the US printing money and STEALING in what then are bogus free trade agreements. They buy our goods for 15cents in the dollar which is what it costs to print a dollar bill. That is NOT free trade it is THEFT and our politicians are addicted to the numbers rather than the VALUE of our trade agreements. The insanity is palpable and I applaud people like Alan Jones for subtley getting this message across.

Instead of a TT, Make Jones the PM. I have not seen a better media communicator nor a sharper mind since Hawke and possibly FDR as well. Jones will ride to the sound of the guns and not play with fake dollar bills like our you-know-who half witted federal and state schizoid leaders. That's the way he coached Rugby to win and thats the way he would lead this nation ---TO WIN.

Just a thought; the carbon tax will achieve nothing so why dont we ask the federal Govt. to increase GST. on all imported goods to say 20%? This could have multiple benefits!

One it would give our manufacturing sector a competitive edge and secondly by substituting imports with the production of our own consumer goods it would reduce our growing foriegn debt.

The increased employment opportunities thus created would also increase the Govt's tax take and reduce the social security bill as people start earning again, another win win situation.

At the present time we can not compete with low cost imports and the current economic orthodoxy does not address this anomaly.

Australia needs to reclaim the right to produce its own wealth and like it or not the only avenue available to this end is through Government intervention.

We might also get better quality goods, ones worth paying extra for.
Den 71

Yes, money does move from account to account! Often it's the same parcels of money, transiting through numbers of accounts, owned by the same entity; i.e., a parent and several subsidiaries.
This is yet another one of those creative accounting schemes, to make the banks, commercial lenders, believe that the businesses are all doing well, given the raw "cash-flow" numbers?
Or alternatively, allow the tax office to believe, that the outgoings are somewhat larger than the income or earnings?
The difference between a T.T. and an E.T, as I understand it, is the point of collection. Transactions are recorded as money goes in or out of any account, whereas Expenditure, only when it leaves an account?
I prefer an expenditure tax, given it almost exactly equates to the individual's or an entity's carbon footprint! The more money you spend the larger your carbon footprint!
Moreover, an expenditure tax, can be marginally adjusted to alone control all inflation or stagnation, region by region if necessary!
Meaning, interest rates can be adjusted downwards and then left at historical lows, to power up and turbocharge the non mining economy!
I mean, we will all too soon be faced with a post mining economy and need to create something far more rational and endlessly sustainable, that will grow and prosper future generations, even as the world depopulates!

The increased employment opportunities thus created would also increase the Govt's tax take and reduce the social security bill as people start earning again, another win win situation.

But hang on Den71, we are at almost full employment now. Apparently!

As for the mining boom, I don't think most realize just what impact mining has on us, as there are many side line businesses and contractors who, if not for the mining, would simply be out of business.

Besides, thanks largely to mining, wages are now too high for is to ever become competitive again.

I am afraid those days are gone, and to assume we can reignite our manufacturing simply by decreasing interest rates or increasing taxes on imported goods is all but a dream I am afraid.

No amount of tax will make up the gap between our wages and the two dollars a day many of our competitors pay.

Jobs growth as returning manufacture is continuing in America, given the cost of transport is proving more and increasingly costly, than utilising local labour? Moreover, the cost of labour in China is increasing with the size of their prosperous middle class.
Professional salaries in tiny resource poor Singapore are on average around 2.5 times higher than ours, and income tax hovers around 11%?
All made possible by the patent pragmatism of govt investments in a whole range of service industries, telcos, airlines, etc/etc.
Our manufacturing could be rescued by energy dependant high tech manufacture, tax reform/simplification and NBN assisted direct sales, which in many cases, will reduce the retail price by 40-50%, all while increasing volume and profitability.
What we need and simply cannot succeed and or compete without, is cheap energy!
We have as others have indicated, quite massive NG resources! In govt hands as the owner operator, prices to us, of what is still the peoples' property, could be reduced by as much as 400%.
Solar thermal projects, that supply power during the daylight hours, or peak demand, could come in at a lot less than coal fired power, as very large govt owned and operated projects; that tap into the economies of scale, that could and should reduce prices, all while rescuing the steel industry.
We can and should explore and mine the reef, at least the now dead parts, that can hardly be further harmed by exploration or exploitation.
If that then allows us to tap into quite massive, very low cost to us energy resources, which when substituted for current fossil fuel, will reduce our transport carbon output by as much as 75%!
And much much more when CNG powered, ceramic cells substitute for diesel electric and some coal fired options!
Who amongst us could argue against that?
Why. those in the employ of those with the most to lose, by the exchange, of course?
Rhrosty.

The problem we have in Australia is that we are unique, in that we have a very small population, all with huge appities for a lifestyle, which means, we rely so heavily on exports.

To keep exports strong, we need two things, a strong market and to be competitive, we don't have either.

In fact, take away mining and seriously, what is left.

As for us being a competitor on the manufacturing scene, every single cost we have, from extracting raw materials, to transport, to planning and manufacturing it's self, are higher.

This is largely due to our very high low skilled wages, as all other wages in the chain follow suit

We used to manufacture small items as well, whereas now days we develop prototypes, but the likes of China do the manufacturing.

TJM is one such example.

They used to have 60 odd on the production floor, whereas they now have two. They design and build a prototype and let China do the rest.

The only way we can become a manufacturer again is to completely rethink welfare, where every single, able bodied person on benefits works for them in government owned factories.

Fat chance though, as one, we don't have the capital to establish such factories, and two, the do-gooders won't allow it.

I am afraid we are a product of our own making, as when low skilled wages are so high, skilled wages become unaffordable for us to remain competitive.

We simply can't have it both ways, but then some of us knew that.