Joining dots in our free-markets (free-for-all) world does not always need those dismal science practitioners known as economists, who are mainly still peddling so-called neo-liberalism. Observation and common sense suffice.
Bluescope Steel has announced a year end loss of $118m and shedding 1000 jobs from its Australian steel-making operations, citing the high Aussie dollar and loss of markets. BHP Billiton, on the other hand, announced a record $22.5 billion profit (double last year) despite the impacts of Queensland floods, etc. Unsurpisingly the fates of those two companies are inextricably linked.
Nobody could possibly consider the BHP Billiton result as ‘super profit’ surely? As for trying to tax it more, tell ‘em they’re dreamin’. Miners only had to share a measly $20m anti-tax ad campaign to protect those torrents of obscene profits flowing from our common wealth…..remember the origin of it! Mike Carlton’s take on Nauru’s mining boom is useful.
But I digress. As we know BHP is heavily involved in mining and shipping out large lumps of Australian iron ore and coal, largely to China. Cleverly, the Chinese then make steel and turn it into stuff that we all like to buy cheaply. Steel that is not transformed is also sold and shipped to Australia, including to our mining companies, for use in their infrastructure construction.
This totally unpredictable development appears to have caught our political leaders by surprise, but don’t worry, they’ve got a plan. They’re gunna ask the mining companies if they wouldn’t mind ‘buying Australian’ steel. Sounds like Dick Smith’s old campaign for selling peanut butter, and it’s bound to work.