Here was John Howard back in 2007 – you remember, that glorious period before the unions took over and killed our economy:
On the subject of mining, there is a risk to the strength of the mining industry in Australia. There is a real risk, and I reminded the people of Western Australia of this when I spoke on Western Australian radio. I pointed out that the real risk to the mining boom is Labor’s industrial relations policy. The real risk to the mining boom is the abolition of AWAs. The real risk to the mining boom is to bring back the supremacy of collective bargaining across all the mining operations of this country. The real risk to the mining industry is that this country, once again, if a Labor government were to be elected, would be burdened with an industrial relations policy not serving the interests of the mining industry, not serving the interests of workers in the mining industry, not serving the interests of the future prosperity of our nation but rather serving the interests of union power.
Here was Tony Abbott last year in Parliament talking about the horrors of the mining tax:
… and now the government is targeting the most productive industry in our country with a penalty tax almost guaranteed to kill the mining boom stone dead….
and again last year:
What the new Prime Minister wants to do, just as surely as her predecessor, is to increase the rate of tax on mining from about the international average to the highest in the world. She wants to increase the rate of tax on mining from about 40 per cent to about 57 per cent. Sure, there will be plenty of words, there will be plenty of fiddles, but at heart it is the same great big new tax. It is the same dagger aimed at the heart of our prosperity. It is the same fundamental misunderstanding of what makes this country and this economy work.
There would have been no mining tax. And still, if we have our way, there will be no mining tax, because it is a dagger aimed at the heart of the Australian economy. No responsible economic manager would ever put the most important sector of our economy at risk the way this government is doing.
Here was Andrew Robb on the mining Tax:
I had a call from a friend of mine a few days ago. The friend runs some significant mines in countries in Asia, countries that have some political risk. This friend of mine rang the other day and said he is no longer being asked about political risk in Asia. He said the sovereign risk which has always dogged his attempts to raise hundreds of millions of dollars to invest in these Asian countries is now similarly enjoyed by Australia. Australia is now the laughing stock of sharemarkets around the world
Here was Tony Abbott talking to Alan Jones last year:
You make a bigger profit, you pay more tax. You mine more product, you pay higher royalties. That’s just the way it works, so the country was doing very well out of mining but then you put the highest tax in the world on mining or you propose to do that and inevitable investment dries up, jobs dry up…
It’s a capital strike.
…and we’ve just had the release of the international rankings of different countries as safe places to do mining business and thanks to the mere proposal for a mining tax Alan, Australia has dropped 13 places in those rankings in a single year. We now rank behind Argentina, Ghana, Tanzania, Namibia, Botswana. This is crazy stuff. This is what the Government has done, it has trashed Australia’s international reputation.
Here is Abbott talking about the carbon tax:
First of all, you cannot trust this government to protect the mining industry, which is still under deadly threat.
Today there was a little announcement from BHP:
BHP Billiton plans to defy uncertainty over a carbon price and the imposition of a mining tax to pursue a $48 billion expansion of its iron ore operations - one of the biggest resources projects in the nation's history.
The expansion of the mining monolith's Pilbara iron ore mines, ports and railways in Western Australia is flagged in federal and state approval applications and comes as the company today prepares to resume delicate talks with the government on Labor's plan to price carbon.
Forty eight billion dollars. Someone needs to tell Tony that the dagger seems to be missing its target.
Here was Abbott’s reaction to the news:
I think they're [BHP] assuming that either this Government or the independents or a new Government would alter this tax, or hopefully rescind it."
Well now. Really, Tony?
As a shareholder of BHP if my board is making investment decision of the order of $43 billion on the basis of a hunch about what they hope the Government might do, then not only do I want to know, I want them sacked for gross incompetence.
Let’s be clear. The repeal of AWA didn’t kill the mining industry; the Mining Resources Rent Tax won’t kill the mining industry; the carbon price won’t kill the mining industry.
Any company worth its salt (or coal or iron ore) would already be factoring in the carbon tax and MRRT – and so to are investors. Why? Because when you are making billion dollar decision you don’t hope for the best – you conservatively factor in the likely risks and costs and then you make your decision. Mining exploration and business is risky enough without taking a $43b gamble that maybe the government will change its mind.
Will there be job losses from the carbon tax? Yes. certainly there will be. The Government is going to have to confront this. Those who suggest it’ll be sunshine and flowers for all are being disingenuous at best, out right lying at worst. But those who suggest a carbon tax should not be implemented if there is one job lost? Please. If we had that attitude, we’d still be using typing pools.
A price on carbon is an economic reform. And like every reform to the economy in the past, people will lose their jobs. The Government needs to be saying more than just “retraining”, it will need actual solid programs and assistance in place to help those who will lose their jobs.
It won’t be enough for some, but it is something the Government needs to really start addressing now. If they don;t how the hell can they expect people in affected industries to feel like the Government gives a damn?
But while there will be some job losses, the next time you hear someone talk about a capital strike, or how Australia is a risky place to invest, or that an entire town in South Australia will be wiped off the map, tell them to calm down and ask them about the $43b? And ask them about those who are investing in BHP? Because look at its share price in the last 6 months – a six months in which the carbon tax has been proposed and the MRRT continues to be on the table.
From around $41.50 a share in October it now sits at around $47 a share (a 13 per cent increase). At that kind of return, I just hope Peter Dutton has held onto his shares.