Wednesday, November 12, 2008

Winners and Losers

Our Prime Minister has declared a "War on Unemployment" to combat one of the bigger problems arising from the global financial meltdown.

But it is the Treasury staffers who are pulling the levers – in fact the same people who have by and large, been pulling the same levers for the past decade and more. Is it any wonder then that we see the same unintended consequences resulting in the creation yet again of groups of "winners" and "losers".

If you are a loser then blame the econocrats in Treasury. If you are a winner then just pocket the cash and grin ;-)

Obviously the car industry and it’s various hangers on are among the winners. This is an industry that has been on the public teat in one way or another since the end of the second world war – over 70 years ago.

If you are involved with the car industry then you will be a winner because according to Treasury you are part of an industry that they deem too big to fail – so you can happily keep doing the same things that you have been doing since day dot.

Perhaps eventually the local car industry will get creative and innovative and produce efficient and inexpensive quality transport that stirs the soul – but I won’t be holding my breath.

Meanwhile, all those small, innovative, creative and mostly technology based industries that are at the dawn of a new age will become the losers.

These are the so called "soft" industries – that are evolving and developing in and around the internet and which rely on, develop and use leading edge information technology.

They include; analytics, image, video, audio and other software developers who are the backbone of the success of Google and others. Unfortunately, they are largely invisible to politicians and bureaucrats and they don’t have a big brother in Treasury or a capable industry association and lobbyists to watch over them.

Believe it or not there were once a large number of people employed in Australia in these industries and in the original information technology industry which got started here around the mid 1970’s. The large companies like banks and telco’s actually can’t operate without IT but for some reason they don’t like employing Australians to make it all work.

The banks and other large corporates have been relentlessly *offshoring* these jobs for a few years now because they have been pursuing a "lowest cost" model. It’s ironic that the local banks seek to operate under the protection of the "Four Pillars" policy while discarding Australian staff in information technology and other areas.

In the same week that our Prime Minister announced that he would throw over $6 billion dollars at the local car industry, one of our local banks announced that it was sending a $580 million technology project to India. Great timing. Which bank?

It’s obvious to me which industry we should be fostering and supporting and which ones we should be weaning off the public teat.

But then I don’t work for Treasury.

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