She’ll be right mate! (we hope)
The global financial hissy fit is hitting Australia. We are not immune, despite this country having rich, natural resources. You need a country or two to buy these natural resources and if those countries (like China) are feeling pain, well, you ‘aint going to sell as much as you think. What happens is that these countries come after your natural resources, hoping to get them at bargain basement prices – so, for example, Chinalco has an AU$30 billion bid for 18% of Rio Tinto (although I suspect the Foreign Investment Review Board will block this).
Our national unemployment rate has risen from 4.8% to 5.2% on the heels of 590,000 people being tossed out of a job. Australian banks are ditching their employees overboard and moving jobs to India. Pacific Brands (the company behind labels like Bonds, Holeproof, Berlei and Hard Yakka) has closed seven of its Australian factories and axed 1850 jobs (which will be sent offshore as part of its restructuring plan). In a day of horror, 3565 jobs were lost when BHP Billiton, Rio Tinto, David Jones and CSR took the razor to their workforces.
Our PM is saying: “Things will get worse before they get better ….The magnitude of the global financial crisis almost beggars belief.”
But I was having lunch with a chap the other day and this person said: “Global recession? What recession? People are still lunching and buying things. She’ll be right mate!” Ah, yes the good old Aussie national response to anything that looks as though it might disrupt our obsession with footy, meat pies, Holden cars or retail therapy. This response has always struck me as about as dumb as sticking your head in the sand. Alternatively, we could say it’s the Aussie fighting spirit – that we’re a nation of tough as boots people who endure harsh weather, droughts, floods, bushfires, you name it. So a global financial hissy fit isn’t going to scare us one bit. Bring it on!
But pause for thought: I had to travel to Melbourne earlier this week to facilitate a meeting and in the hotel room was a copy of The Week (Australian edition, March 13 2009). I’d been reading Harry S Dent’s book, The Great Depression Ahead, and was too forlorn to continue onto Chapter 7 that evening. So I picked up the mag and it opened magically to page 3, where my eye immediately caught sight of this quote (by David Salter):
“What worries me is that when the bad times arrive, which they surely must, we might not turn out to be quite as resilient as we thought. Australians today aren’t the same stoic bunch as those who faced the Great Depression. For them, Gallipoli and the horrors of the Western Front were just 15 years earlier. Many of the tough men and women who’d survived the terrible drought and financial hardships of the 1890s still sat at the head of family tables. We’re much softer now – coddled by welfare entitlements and high standards of living based on personal debt. Will we still have the reserves of tenacity, endurance and self-sacrifice to match our grandparents?”.
And THIS I think is the profound question that will face Australians in 2009 and 2010. As a nation, do we still have the right stuff to weather the vicious storm ahead?