As explained by ‘Alan Kohler’ of the ABC, the record trade surplus is largely due to “A huge rebound in iron ore, coal and gold exports delivers a record trade surplus of $3.5 billion in December, providing a big boost to national income.”, with no proportional increase in imports.
I suggest an analysis of the impact on the Australian economy is reason for people around the world to consider the impact of automation.
There is some good news for some, but it is clearly evident, that unlike the mining boom of the early 2000s, this record level (and thus even greater boom in some ways) sees the states where the mining takes place still in economic decline. In place of the the boom times these states enjoyed as a result of mining in the past, this time those states have no economic lift at all . This is at least in part due to the revolution in automation that has taken place in recent years. Bear in mind that this same type of revolution is planned for almost every industry in the near future.
What created the previous ‘mining boom’?
In the early 2000s, the states of Queensland and particularly Western Australia, enjoyed economic ‘booms’ attributed to mining. Whole new towns were created to house the miners. The industry of building those new towns created more employment and more people who also needed housing and every other service people need. For each job created directly in the mine, building the infrastructure to support the mine (such as road or rail) and the new towns, there was a flow on effect of hairdressers, cafes, and every other service a community needs.
What has changed?
The mining boom led to rapidly climbing real estate prices, very strong employment and rising wages until the GFC. Since that time these economies have slowed significantly. But now, with actual record surplus largely attributed to mining, employment in these states is still lower, real estate still stagnant and there are no indications of a new boom. Cleary things are different this time , and among those things is automation. The fully automated mine is a reality, and even automated transport around the mine, and to and from the mine.
The Economic Impact.
Beyond the tax office, almost the only Australians to gain any share of the mining derived export revenues now are those (mostly very wealthy) shareholders of the mining companies. Note that not all shareholders of these companies are Australian. In fact, with this new boom, while the boom raises tax revenue, the amount raised is less than when labour is a significant cost. The people earning salaries also pay tax and are less able to tax minimise than major corporations so while any boom does raise tax revenue, a boom with employment is best even for taxes. So the share of wealth going to taxes is also reduced, just not as savagely as the share spread through the community.
Simply put, the wealth is still created, but not distributed through the community. Tackling this problem as automation spreads worldwide and through more and more industries is a key challenge society is now facing.