I am depressed and even more depressed by the direction this government is taking this nation.
Over the last five years the government and some of the right wing presses deceived us over Iraq, WMD, and the war on terror.
Some Aussies were deceived over children overboard, the threat asylum seekers might cause us: Delivering us the stupid barbaric expensive Pacific solution.
Higher education has and will become beyond the reach of the average Aussie without a thick wallet. More and more of our educational resources will be leased out to overseas students.
We were conned by the iron-clad guarantees over Medicare.

Now Aussies are now paying themselves to be conned by simplistic
economics that were at home in pre- 1830's England..

Anyone with a bit of nouse can see whats on the horizon.
Well start building more and more privatised prisons like the U.S where people at the bottom end who have to wait 9 weeks for welfare will become desperate enough to commit petty crimes in order to survive.

Australia can't you see these changes are a nightmare for all Australians. All the settings for a dysfunctional ugly society are being put in place!

Hey Yobbo,

l studied economics and the idea that businesses reinvest all profits back into their business and create new jobs is straight out of 1st year economics. Very naive to say the least. The only thing about economics that actually made any sense to me was something that my lecturer told us one day...that you can link the worlds economists hand to hand, enuff to encircle the globe twice and none of them would ever reach agreement.

Economic theory has a wounderful capacity for taking sheer leaps of faith and dressing them up in numbers and formulae and essentially contructing wounderfully contrived self serving rationale. The favourite qualifier of all economics models is ceteris parabis... all things being equal. Hate to burst your bubble but all things are never equal. You cannot eliminate variance and level the field by way of pretending just so that a theory flies. Major flaw there.

Anyway, l am not blanketly dismissing economics just trying to knock off some of the pretentions of the 'exact science' mantra that babblers of economic rhetorical theorum rely so heavily upon.

Yob, l have also owned and operated a few businesses and l gotta tell you that the number one objective was to take the profits OUT of the business and put them into others areas of my life... you know house, car, holidays, toys, other investments. l crunch numbers for a living and have done a lot of that for various business operators over the last 2 decades and ALL of them aim to get money OUT of the business... that is wot drives them. The business is a means not an end.

Whenever too much (unsustainable) profit was reinvesated for expansion, often to the point of borrowing, that usually had a way of making the business go backwards. Productivity can often suffer because economies of scale sometimes dont eventuaute and sometimes you just end up going from steak to noodles because you were romanced by the alure of caviar. Then there is efficient use of capital, something that is paramount to all business owners. Whats the use of having to double capital invest and triple your work force and work twice as hard for a 25% profit increase? Might as well put that capital into something else... like another business.

Now, if this all sounds a bit stupid to you, thats ok, blame it on the gunja. You would be surprised how many business owners and so called capitalist conservatives enjoy the wacky backy with a glass of red. You really would.

trade 215,

Nice summary of economics. No wonder you became an accountant. As for your "you could line up all the economist in the world blah blah blah". That applies to just about anything in life. Try getting anyone anywhere to agree on anything. You'll also find that every field of science and social science applies ceteris paribus when modelling complex interactions because it is the only way that we can understand how things work. And who called economics an exact science anyway (apart from you)?

As for the rest of your post, what's your point? Where do you think the profit from business goes? When you spend money on "house, car, holidays, toys" it goes into other businesses. And any business person who doesnt reinvest into their business goes broke. You run down your assets.

"Then there is efficient use of capital, something that is paramount to all business owners. Whats the use of having to double capital invest and triple your work force and work twice as hard for a 25% profit increase?"

I think you answered your own question there. 25% profit increase. If your making profit why wouldnt you expand? Profit implies that you have something left over after you take your expenses (including your personal income which you spend on toys and cars etc) out. What else are you going to do with the money. You seem to be assuming that nobody wants to work twice as hard.

"Yob, l have also owned and operated a few businesses and l gotta tell you that the number one objective was to take the profits OUT of the business and put them into others areas of my life... you know house, car, holidays, toys, other investments."

Well you just proved my point. You didn't put the money under your mattress, you spent it, which creates economic growth and employment.

"Then there is efficient use of capital, something that is paramount to all business owners. Whats the use of having to double capital invest and triple your work force and work twice as hard for a 25% profit increase? Might as well put that capital into something else... like another business."

Whether you invest into the existing business or a new business, or just spend the money on beer makes absolutely zero difference to the economic effects of the investment. For someone who spent about 300 words explaining how much they knew about economics you missed this fairly obvious point.

There also needs to be reforms in terms of Govt over regulation.There is so much red tape and mal-administration in NSW that business is just moving to other states.I see this as a higher priority than having individual workplace agreements.Employers just want to be able to hire and keep good workers and rid themselves of lay abouts without the legal disease.

I just worry about the Howard Govt just servicing the big end of town and letting small business diminish even more.

If the reforms seriously disadvantage ordinary workers,then we will again see the growth of radical unions and we will all lose.We cannot compete with China or India on the price of labour,nor should we try to.There is obiviously pressure on the Govt to do something about the balance of payments which continues to blow out as we import more.Where are the Govt incentives to create our own industries in new technology?What happened to the concept of the smart country?There is a very real fear that China and India will soon leave us in their wake however we should not diminish wages and conditions to match those of third world countries.

Just make Govt and public administration more efficient,get more people off social security reduce taxes and everyone can share in the bounty,not just big business and drone shareholders.