Adelaide holds a special place in my heart, I spent 11 years there, from 1983-1994, starting off as a long term unemployed to someone who got a career in the public service in 1990, through persistence, meeting the right people at the right time with the right advice esp. with regard to public housing, then later community housing through CHASSA (Community housing association of S.A.), where I wound up with excellent housing with Turtle Housing Coop. I remember the premier John Bannon for 2 things mostly: the failed State Bank, and the failed 'multi-function polis.'
But Malcolm is right, wages are lower than in Vic or NSW but it's hardly an incentive. South Australia can continue being the 'cinderella state', going on and on about its 'victim' status and asking for special dispensation or extra subsidies, or start becoming more assertive, reaching out to empower everyone, esp. the worst off, through at least decent housing, and some hope of work, maybe even in small business.S.A. started off as a noble experiment by Col. Light of free men and free women, not having to rely on convict labor.
There are only 2 options available now: to become more self assertive and self reliant, become more pro-life by closing down all those abortion clinics (after all, Adelaide is already losing many of its best and brightest through emigration, and it continues to allow abortion on demand: how suicidal is that?) and inclusive by reaching out to everyone, esp. those in Elizabeth and Christie Downs,
or foreclose on itself, surrender its statehood to Canberra and turn itself into a territory (non-self-governing), and privatise every single entity available.
Doing nothing is not an option: it's just forestalling the inevitable.

Struth, what a silly article!

It criticises The Advertiser for not being a newspaper, but completely swallows the Murdoch Press's lies about the Rudd and Gillard governments "spending like a drunken sailor" and 'creating new entitlement programs without the ability to pay for them'. Or are those the Liberal Party's lies? Either way Malcolm's contributing to the promotion of bogus problems which politicians damage SA's interests in an attempt to fix.

And the drop in iron ore prices may actually be good for Olympic Dam, as it's forcing our overvalued dollar down, which makes mining of copper, gold and uranium more viable (although the effect is slight because short term factors have limited influence in long term investment decisions).

SA's biggest problem by far is a lack of investment, and a big reason for that is that interest rates are set to control inflation in the eastern states. Hypothetically if they were set to control inflation in SA, they'd be much lower. But we're not getting much compensation for interest rates being set too high, and the government's completely ignoring the fact that spending in SA is less inflationary than spending the same amount elsewhere.

Not so sure Adelaide folk can blame the eastern states and especially Sydney and Melbourne for inflation taming interest rates. Bit of an odd comment, mate.

Aidan

Oy be agreein wid Paddy.

Saemus O'Bignob

Malcolm, the truth may appear odd because you've fallen for the economic myths that the Liberals and the Murdoch press promote. But in reality the significance of balanced budgets is quite low for governments (and for sovereign currency issuers such as the Federal government, the zero point is of zero significance).

Public and private spending (including investment spending) have the same inflationary effect, which is low if unemployment is high (as it reduces unemoloyment instead), and high if unemployment is low (though what counts is real unemployment and underemployment, not the headline unemployment figure). Interest rates are meant to control inflation by influencing private spending decisions (as when interest rates rise, businesses and people may regard it as preferable to save or not borrow) but they also have the short term effect of pushing up the value of the dollar.

For twenty five years, interest rates have been set too high for SA. In the past five years having higher interest rates than other countries has pushed our dollar unsustainably high, crippling our manufacturing sector. And to add insult to injury, this was initially triggered by a fall in the headline unemployment rate without any signs of real inflation, and more recently we've suffered inflation from the dollar falling back to its natural level (pushing up the price of imports).

And now the RBA is refusinng to cut interest rates because it's worried about house prices in the eastern states, the PUPpies are the only political party challenging the narrative that Australia should aim for a balanced budget (an objective the Federal government tend to pursue by cutting spening in SA) and the state government's reluctant to invest because of paranoia about debt levels and credit ratings, partly fuelled by the state opposition's bogus claims about how much interest we're paying.

So how do you think we should get anyone to invest in SA?

"For twenty five years, interest rates have been set too high for SA."

I think you mean Australia and I agree with you. Currently the state is predominantly focused on agricultural and mining.

But you could lower it all you liked and people still won't invest in SA or at least not on the scale we need to. There simply isn't the ability to generate revenue in SA for international investors. Although that might change.

I maintain that considerably more economic drive can come from international students as well as offshore alumni partnerships. This is an area that has hardly been explored.