• 2 days U.S. On Track To Unseat Saudi Arabia As No.2 Oil Producer In the World
  • 2 days Senior Interior Dept. Official Says Florida Still On Trump’s Draft Drilling Plan
  • 2 days Schlumberger Optimistic In 2018 For Oilfield Services Businesses
  • 3 days Only 1/3 Of Oil Patch Jobs To Return To Canada After Downturn Ends
  • 3 days Statoil, YPF Finalize Joint Vaca Muerta Development Deal
  • 3 days TransCanada Boasts Long-Term Commitments For Keystone XL
  • 3 days Nigeria Files Suit Against JP Morgan Over Oil Field Sale
  • 3 days Chinese Oil Ships Found Violating UN Sanctions On North Korea
  • 3 days Oil Slick From Iranian Tanker Explosion Is Now The Size Of Paris
  • 3 days Nigeria Approves Petroleum Industry Bill After 17 Long Years
  • 4 days Venezuelan Output Drops To 28-Year Low In 2017
  • 4 days OPEC Revises Up Non-OPEC Production Estimates For 2018
  • 4 days Iraq Ready To Sign Deal With BP For Kirkuk Fields
  • 4 days Kinder Morgan Delays Trans Mountain Launch Again
  • 4 days Shell Inks Another Solar Deal
  • 5 days API Reports Seventh Large Crude Draw In Seven Weeks
  • 5 days Maduro’s Advisors Recommend Selling Petro At Steep 60% Discount
  • 5 days EIA: Shale Oil Output To Rise By 1.8 Million Bpd Through Q1 2019
  • 5 days IEA: Don’t Expect Much Oil From Arctic National Wildlife Refuge Before 2030
  • 5 days Minister Says Norway Must Prepare For Arctic Oil Race With Russia
  • 5 days Eight Years Late—UK Hinkley Point C To Be In Service By 2025
  • 5 days Sunk Iranian Oil Tanker Leave Behind Two Slicks
  • 5 days Saudi Arabia Shuns UBS, BofA As Aramco IPO Coordinators
  • 5 days WCS-WTI Spread Narrows As Exports-By-Rail Pick Up
  • 5 days Norway Grants Record 75 New Offshore Exploration Leases
  • 5 days China’s Growing Appetite For Renewables
  • 6 days Chevron To Resume Drilling In Kurdistan
  • 6 days India Boosts Oil, Gas Resource Estimate Ahead Of Bidding Round
  • 6 days India’s Reliance Boosts Export Refinery Capacity By 30%
  • 6 days Nigeria Among Worst Performers In Electricity Supply
  • 6 days ELN Attacks Another Colombian Pipeline As Ceasefire Ceases
  • 6 days Shell Buys 43.8% Stake In Silicon Ranch Solar
  • 6 days Saudis To Award Nuclear Power Contracts In December
  • 7 days Shell Approves Its First North Sea Oil Project In Six Years
  • 7 days China Unlikely To Maintain Record Oil Product Exports
  • 7 days Australia Solar Power Additions Hit Record In 2017
  • 7 days Morocco Prepares $4.6B Gas Project Tender
  • 7 days Iranian Oil Tanker Sinks After Second Explosion
  • 9 days Russia To Discuss Possible Exit From OPEC Deal
  • 9 days Iranian Oil Tanker Drifts Into Japanese Waters As Fires Rage On
Alt Text

Russia, China Grow Closer As The New Silk Road Unfolds

China’s ambitious Belt and Road…

Alt Text

Azerbaijan: A Crucial Energy Hub

Its strategic location and its…

Gregory R. Copley

Gregory R. Copley

Historian, author and strategic analyst — and onetime industrialist — Gregory R. Copley, 70, has for four decades worked at the highest levels with various…

More Info

Has Julia Gillard's Time in Power Ruined Australia's Economy?

Has Julia Gillard's Time in Power Ruined Australia's Economy?

Prime Minister Julia Gillard’s Labour Party (ALP)-dominated coalition Government of Australia has clung to power without an express public mandate since the August 21, 2010, House of Representatives elections. This has been largely because its parliamentary majority has been guaranteed by four independent parliamentarians and one member of the Greens party, all of whom recognize that they would be unlikely ever again to gain a position of power and vote with the ALP to preserve their privilege for as long as possible.

Thus, Ms Gillard has been able to avoid being voted from office. Even her colleagues privately agree that when (not if) she falls, the Australian Labour Party has been so damaged by its extreme ideological politics that it was felt unlikely that the party would see office again for another decade.
Ms Gillard has, however, sought to achieve two things: firstly, a new budget designed to give her a fighting chance at the next elections (scheduled for 2013 unless the Government collapses earlier); and secondly, to make some changes “on the ground” which would reinforce government control over the economy and political expression, by being able to, essentially, eliminate freedom of speech. The new budget has been called a juggling act, and, even though it promises to deliver a surplus, Australian economists have pointed out that it is unlikely to do so, and relies heavily, as well, on earnings from a new carbon tax and a super-tax on mining companies to deliver revenues.

There has been little attempt to rein in government spending; on the contrary, the role of the State continues to expand. But in the short-term, there would be cuts in defense spending, and this may well hit at the progress of Australian plans to acquire the US-UK F-35 Lightning II fighter for the Royal Australian Air Force (RAAF). Certainly, the rosy days of considering a buy of 12 new submarines are fading from memory, even if the Royal Australian Navy (RAN) could find sufficient manpower for the fleet.

Defence spending has been cut, under the new budget, to below 1.6 percent of GDP, a depressed level not seen since the 1930s. Only the significant level of growth in Australian mineral exports — which Ms Gillard has attempted to harness with additional taxes, despite the prospect of a decline in the near term in the PRC’s import requirements from Australia — has kept some of the major defense programs, such as the F-35, in contention. Dr Mark Thomson, from the Australian Strategic Policy Institute, claimed that, under the ALP, defense spending for 2013-14 would be at 1.5 percent of GDP and in 2015-16 would be 1.6 percent of GDP. The UK for example, spends 2.57 percent of GDP on defense. But the out-year projections on defense spending even assume that the economy — and therefore the Government’s ability to raise funds — would grow at the levels projected. This is highly unlikely, given present trends. The Government has now called for a new Defence White Paper to look at the question of Australian security, but all such Australian White Papers since the 1986 Defence White Paper — the last truly strategic appreciation of Australia’s strategic position and goals — have been highly politicized and their real substance cut and shaped to ensure that the white papers merely reflected a bland and unstartling view of the global threat.

“The Government takes great pains to solicit the best advice from the broader strategic community in Australia, and then manages to pigeonhole and ignore it,” one analyst — who was asked to provide testimony for the new White Paper — noted.

Meanwhile, the new budget was not well received, neither by the mainstream Australian electorate, nor by economists. Even though the Government portrayed the budget as one which slashes spending, this is not really the case. Former Australian Treasury official Des More noted: “Unsurprisingly, the level of spending is projected to increase again in 2013-14 to 23.7 percent of GDP. Note that the rate of growth in real spending since 2007-08 is over three percent per annum, above the Government’s promise to keep it, on average, at two percent per annum.” Analyst Terry McCrann, writing in the Herald-Sun newspaper on May 8, 2012, noted that Treasurer Wayne Swan’s plan was “an unbelievable budget. Literally.” He noted that the budget included new spending of A$22-billion (approximately the same in US$) over the coming five years, including the current fiscal year. Overall, he said, “Spending goes up $25-billion this current year; falls $7-billion next year; and then leaps by $23-billion.”

Meanwhile, the Gillard Government has been moving ahead with plans to introduce controls on what could and could not be said in the media. By “media”, it meant all forms of public dissemination of information, including internet, blogging, and twittering, as well as the conventional print and electronic media. The Gillard Government has phrased its approaches to creating restraints — and a monitoring watchdog — under the guise of ensuring “fairness”, but the reality is intended to be one of the most sweeping reversals on freedom of expression seen in a Western society since World War II’s security censorship laws.

It is usually assumed that, with the fall of the Gillard Government, an incoming coalition of the Liberal and National parties would reverse the carbon taxes, the mining super-tax, and the curtailment of free expression, but that cannot be guaranteed. What is likely to occur, given Australian political history — which is not dissimilar to that of other Western states — is that an incoming government would be reluctant to abandon the additional revenue sources created by an earlier government, even though the taxes were challenged ideologically when the new Administration had been in opposition. Equally, the attempts to curtail free speech would likely also be seen as favouring the government of the day, regardless of party, and could well be retained.

In the meantime, the Gillard Government has made no moves to position Australia as a high-growth, major economic player in the global community. The Prime Minister — and Australian officials generally — have disdained comparison with the so-called “BRICS” states (Brazil, Russia, India, China, and South Africa), even though Australia, on a per capita basis (with 23-million population) is more than competitive with the BRICS. Australia’s 2010 GDP was $924.843-billion. Brazil’s 2010 GDP stood at $2.087-trillion, with some 185-million population; Russia’s at $1.47- trillion, with 143.4-million people; India’s at $1.727-trillion, with some 1.2-billion people; the PRC’s at $5.92-trillion, with some 1.3-billion people; and South Africa at $363.7-billion, with some 49-million population.

Despite the fact that the Gillard Government entered office with a major budget surplus and in an ideal global position — despite worldwide recessionary trends — it has used the period in office to substantially increase non-productive entitlement spending (essentially vote-buying), and an enlargement of the unproductive State sector of the economy, while actively “de-stimulating” the investment position of the Australian economy. The Australian and Indian GDPs were only narrowly different a decade ago, but, by 2012, and despite a dysfunctional and corruption- prone Indian governance framework, India — like some of the other BRICS — was looking at economic growth rates dramatically higher than Australia’s.

By. GIS/Defense & Foreign Affairs Canberra Office.

Back to homepage

Leave a comment
  • whatever on May 12 2012 said:
    you fail to mention that the coalition was unable to win a majority as well. the australian public voted for a hung parliament, because they dont trust any of them.

    the fact that gillard was able to cobble together a minority govt, shows the total lack of trust and regard people have for any of our polititians, from any party.

    what has done more damage to australia is the way we suck up to the USA -

    involving ourselves with illegal immoral wars of aggression against people who were never a threat to anyone, resulting in the deaths of hundreds of thousands of innocent men women and children..

    all based on the lies of the events of 911..

    id doesnt matter who leads australia, or the USA.. the only choice the public has if they would prefer to be hit over the head with a lump of wood, or a brick.

    its quite obvious your bias against the labor party here, but to pretend abbott would be any better, is laughable.
  • Howard on February 01 2013 said:
    This piece reads like it was written by a partisan shill. If the author wishes to have any credibility, they need to at least gain a basic understanding of Australian politics and the policies on offer from the two major parties.

    The Australian economy is still booming, in comparison to the rest of the world, and that is under the Labor government. The MRRT hasn't cost the mining companies a cent yet because it is a super profits tax.

    The alternative to Labor is the Liberal party who are coming in as a "welfare state conservative party" more than a free market party.

    The Liberal party want to increase the company tax rate to pay for a very generous parental leave scheme.

    The Liberal party wants to reject a market based mechanism for dealing with climate change for a government voucher scheme ("direct action") that gives tax payer funds to polluters and farmers for their actions.

    The Liberal party wants to pull down the largest infrastructure project Australia has seen in years, the National Broadband Network, which would see Australia as one of the leaders in telecommunications. Instead the Liberals want to prop up a badly degraded copper network owned by a privately owned company, which was once in government hands, called "Telstra".

    The author forgets to mention that the Liberal party has not produced any costings so no one has any idea how they will pay for their Direct Action, for their broadband policy.

    This nonsense partisan piece only tells one side of the story and I hope you didn't pay the author a single red cent.

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News