SA Economy

[Dog]

Lol

[claybro]

if businesses aren't making profits they aren't paying tax anyway so no point cutting them. We need stimulus at the spending end not the profit end.

Uhm, business pays taxes regardless of profit or not. It pays payroll tax, it pays GST, it pays exorbitant taxes on electricity, gas and water used in manufacture. It pays green levies, state government levies, compliance levies and local council levies. It pays taxes to import raw materials and taxes to transport and export. It is precisely this complete disregard or seemingly any knowledge of how business operates and that business activity and investment is the engine room of the economy that got Labour so on the nose in the first place. Stimulus spending on the consumption end is not sustainable.

[Dog]

L

[zippySA]

Stimulus spending on the consumption end is not sustainable.

Bravo - if only those in Government understood this!

[Aidan]

Stimulus spending on the consumption end is not sustainable.

Bravo - if only those in Government understood this!

What makes you think those in government don't understand that? They didn't try to sustain the stimulus spending on the consumption end - they paid $900 per person and then moved on to stimulus spending on more productive things.

The consumption end stimulus was deployed first because the government didn't have the capability to immediately start the more productive spending - and when they did a few months later, the Vic and NSW state governments didn't have the capability to manage it. But none of this alters the fact that the stimulus spending revitalised the economy.

[Ben]

From the Australian:

National Affairs Nyrstar closure an economic tsunami: MPs

by: Sarah Martin, SA Political Reporter

From: The Australian August 03, 2013

THE closure of Nyrstar's Port Pirie smelter would deliver an "economic tsunami" for South Australia and leave taxpayers with a remediation bill in the hundreds of millions of dollars, MPs have warned.

The Swiss-based metals giant has raised doubts about the future of its smelter operations beyond 2016 when a $350 million transformation of the plant is required.

South Australian Manufacturing Minister Tom Kenyon said the government had "done everything we can" to facilitate the transformation project, which will be decided by Nyrstar at a February board meeting in Zurich.

Mr Kenyon said if the transformation did not go ahead, the smelter may close, putting thousands of people out of work and wiping about $518m a year from state gross product.

"Until they make that final investment decision in February, until the board says yes ... there is always that danger," he told The Weekend Australian. "My position has always been that we are doing everything we can to help them to get to that 'yes'."

Mr Kenyon said it would be "very difficult" for the government to offer any further financial aid to ensure the transformation went ahead.

The Port Pirie smelter supports Nyrstar's Hobart smelter operations in Tasmania, with the two plants employing 1400 people, and another 4200 indirectly.

Opposition economic development spokesman Martin Hamilton-Smith said the uncertainty surrounding Nyrstar and Holden's northern Adelaide carmaking plant threatened an "economic tsunami" for South Australia. "We all need to face up to the fact there is a chance that the board could decide to walk away," he said. "A closure of the plant would have a dramatic and far-reaching effect on the economic, social and political future of this state."

He warned that any remediation costs left behind as a result of the smelter closure should not be covered by taxpayers.

"This could expose the state budget to hundreds of millions of dollars in contingent liability, something that is not presently budgeted for," Mr Hamilton-Smith said.

He said Nyrstar would face a "very aggressive and energetic pursuit" by a future Liberal government to recover any remediation costs.

Mr Kenyon said the company would be liable for remediation costs, but he had not raised the issue with Nyrstar.

Concerns over the smelter's future come after The Australian yesterday revealed there was an "urgent need to demonstrate immediate viability" of its Australian operations.

Without a profit turnaround, the Nyrstar board may not approve the redevelopment, which still requires a $100m investment from the company and $150m from a third party investor.

A memo to staff - obtained by The Weekend Australian - from general manager Glenn Poynter stressed that following an audit, the site must show "the ability to carry out the required changes".

"Transformation is not yet secured - delivering it is a joint responsibility between site and corporate," Mr Poynter said. "We need to demonstrate the disciplines and performance that create the confidence needed to justify investment in the future transformation of the plant."

Australian Workers Union South Australian secretary Wayne Hanson said Nyrstar had neglected investment in the plant, and should not blame workers for the plant's failings. "Management ... have slipped in to the lazy and complacent habit of blaming the workforce, rather than looking at their own failures," he said.

[claybro]

For those of you here who follow the mantra that any economic downturn can be overcome by governments simply borrowing (printing) more money and spending big, need only look at todays SA unemployment figures. SA is spending huge amounts of borrowed money on infrastructure, and yet our unemployment rate is spiralling. It is simply not sustainable. The success of the original stimulus spending by federal and state governments was inflated by the fact that Australia was shielded from the worst of the GFC by China, and the mining industry, and in fact entered a mini boom immediately after the GFC, once again thanks to mining and China. Now those two props, which have masked Labours management of the economy have fallen, the real story is starting to emerge.

[Dog]

All SA needs now is a Liberal government to sack 25,000 public servants and closes Holdens that will really improve things!

[monotonehell]

For those of you here who follow the mantra that any economic downturn can be overcome by governments simply borrowing (printing) more money and spending big, need only look at todays SA unemployment figures. SA is spending huge amounts of borrowed money on infrastructure, and yet our unemployment rate is spiralling. It is simply not sustainable. The success of the original stimulus spending by federal and state governments was inflated by the fact that Australia was shielded from the worst of the GFC by China, and the mining industry, and in fact entered a mini boom immediately after the GFC, once again thanks to mining and China. Now those two props, which have masked Labours management of the economy have fallen, the real story is starting to emerge.

Kind of like how they masked the Liberal's management of the economy?

It's funny when people think any government hold much sway over the economy.

[Dog]

L

[Dog]

Lol

[claybro]

And John Howard's give away of thousands spent on baby bonus for " flat screen TV's" " Pokies" and single mothers was good public policy.

Completely off topic of the SA economy, but for the record, the idea of the baby bonus was to encourage more people to have babies and therefore create future tax payers.(and quite possible a secret Liberal plan of ensuring the existing anglo gene pool was not too diluted by our commitment to immigration.) It did have an immediate impact on Australia's fertility rate so to that end it was a success. Unfortunately the plan was very poorly executed and probably only resulted in creating future welfare recipients. Howards middle class welfare was supposedly a way of spreading the wealth of a booming economy to those less well off, but in many cases miss guided, and created an era of entitlement that is creating a lot of todays very poor "me too" politics.

[claybro]

Furthermore, back to SA politics, we should all be alarmed, and a little embarrassed that our state unemployment rate is the worst in the nation, and discussing what has gone wrong, not blindly trying to defend undying support of all things Labor.

[Dog]

Lol

[Norman]

I would rather trust the trend figures than the point in time figures, there are always peaks and troughs along the way.