THANKS FOR THE EDUCATION, all your posts as well as the original article.I lived through the 1939 to 1945 war and "economy" was to me "How to save money!" I remember a farmer with 6 kids at the Rodeo and he called the family to lunch.On the back of his truck he had a big tin of TREACLE.He handed each a piece of bread he cut off a loaf. {Nothing sliced back then.} No butter, it was rationed,"Help yourself he said and handed a spoon to each in turn.I WOULD LIKE SOME OF THOSE FACTS I've learnt to be thrown at "aspirational" polititions!

Shadow Minister,

What huge investment in machinery and equipment? Let's see how much of the debt is financing consumption and inflating asset prices such as housing instead of the purchase of capital equipment that will produce an income stream. (Economics 101.5). After 10 years of Howard's economic mastery we are deeper and deeper into the swamp.

a few have beaten me to the punch (eg Yabby) but here it is anyway

“Thirty years ago we were up with the rest of the world in manufacturing; now we are down to 11 per cent of GDP”

That historic performance came at a price.

The price was a high local cost for manufactured goods made in sub-efficient factories, sustained and supported by a tariff and quota regime which meant the consumer was continually screwed and blackmailed into paying around 3 times the competitive price for the privilege of inferior locally manufactured goods.

Do not get me wrong, I wish Australia did have a strong and vibrant manufacturing sector.

I wish we applied greater effort in areas like secondary processing of the minerals and agricultural products which we presently export in bulk.

However, we seem to have full employment.

We are importing people to augment the local work force.

The decline of manufacturing is something I have good reason to personally regret but I would not wish to see its resurgence made possible by deploying the tyranny of quotas and tariffs, which featherbedded the 1950s and 1960 growth companies by raping the wallets of consumers.

One thing I can predict.

When the boom ends and the national economy declines

A recession will sort out the borrowings.

House prices will become more affordable overnight

Opportunities (like the secondary processing I mentioned) will represent and with more unemployed (freed up from the presently successful, really “marginal”, businesses which always fail in recession) will be available to man them.

Imports will decline – as available credit dries up – due to lack of security for foreign lenders from assets (eg housing) in which prices are declining.

The “economic equilibrium” will return.

However, the real difference is plain.

If the government do nothing to halt any recession when it occurs, the outcome will immediate, than if it tries to stave it off. However, the ultimate price for staving off the inevitable (by tariff, protectionism, or socialist nationalization ) will be ultimately be far more severe and far more disastrous to everyone.

Mac,

Every large engineering company and most of the small ones are so busy that they are desperately trying to bring people in from abroad, and even having to turn work away.

The amount of money being spent by businesses, both mining and manufacturing, is breathtaking. The ports are choked not only with exports of raw materials and imports of consumer goods, but also heavy industrial equipment. This I know first hand and don't have to rely on other posts or articles.

This all will translate into further growth later. The real threat to future growth is constrictions such as the unions would impose on the labor market. The boom is here, the danger is in thinking that it is bullet proof. If we stuff it up we will have only ourselves to blame.

Pretending that the economy isn't strong or that it is purely a coincidence that it has happened in the last 10 years is like trying to pretend that you can't see the elephant in the room.

Shadow Minister the fact that you "know first hand" ports are choked with heavy industrial equipment is not proof that our debt is sustainable. The fact that our ports are choked is a problem in itself, that the current government has done little to alleviate in the last 10 years, but more importantly, it doesn't change the fact that the bulk of our foreign debt is in credit cards and mortgages.
Col Rouge is absolutely right, when the boom finally ends and recession bites, it will sort out the borrowings, and it will not be pretty. But surely the point of prudent governmental oversight of the economy is to prevent the situation getting to that point. Sadly, it's probably too late already, but certainly in the US many economists are calling for greater regulation of lending institutions, simply because too many of them have yet again proven themselves incapable of adequate self-regulation, and yes, many customers have proven themselves incapable of judging their own ability to manage debt. If it were true that only those that over-borrowed or over-lent paid the consequences, it would be one thing. But it's never that simple, and the pragmatic position is to accept that having regulations that prevent irresponsible behaviour is generally less costly and dangerous than allowing it go on unhindered.

"Sixty-seven percent of the public can cheerfully think that health is the major election issue."
You can rest assured health will continue to be a big milking cow to capitalize into huge profits. As well, that is what is presented - but the Iraq war is the hidden major issue. As agreed by Labor, Liberal, and the Greens the war will be the great unmentionable during the election. Wars are always presented after the election, as if, they did not know beforehand. Already, there is agreement through utter silence on the upcoming war with Iran for oil and the conquest and domination of that area of the world.
Nor is there any mention about the Howard government's colonial aspirations and interventions into the Pacific region. Presently, Howard is instituting a dirty tricks campaign against Papua New Guinean Prime Minister, Michael Somare, contemptuously defying the outcome of PNG’s August elections. Canberra had hoped the elections would result in a more pliant administration, and is now considering unrestrained “regime change” operation, like the one it recently carried out in East Timor, and is currently orchestrating in the Solomon Islands. What should be rejected with contempt is the cynical fraud by the Liberal, Labor, and Green parties that its interventions have anything to do with humanitarianism. There are resources along with economic and strategic interests at stake; colonial aspirations are back on the agenda. Who is Howard and for that matter Rudd, to claim or lecture anyone, on humanitarian interests with their undeclared war on public health, education and boosting the exploitation rate of workers? The peoples of New Guinea and the rest of the South Pacific have the right to determine their own future.