03/09/2012 - 10:38

Gina Rinehart: the whole story

03/09/2012 - 10:38

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Hancock Prospecting chair Gina Rinehart caused a stir last week when she suggested the minimum wage be cut and called for people who are jealous of the wealthy to socialise less and work harder. Her extensive comments are reproduced in full below, so you can judge for yourself. 

LET’S GET BACK TO OUR ROOTS

By Gina Rinehart.

First published in the Australian Resources & Investment magazine.

There was a time, only a few months ago, that we miners were still going to dig the rest of the country out of a hole.

We miners were going to manage the first boom in history that would last forever, and we’d pour more and more billions each year into Canberra’s coffers. Our minds were closed to the reality of our rising costs and that vast resources from lower cost countries would be entering our markets in competition to our own, as if this didn't matter.

And because this boom would not end, or so went such concept, it did not seem to matter how many more taxes were imposed on mining investors. The miners would pay, anyway.

I write this just as two news items cross my desk which should shock us out of our dreams of complacency.

The first item, is the Deloitte Access Economics report which warns: ''The strong bit of Australia's two-speed economy won't stay strong for more than another two years or so.” The “strong bit” is the mining boom. I hope I can now repeat, without sounding like I’m pleading from self-interest, that the mining pipeline has indeed been squeezed too hard. Australia has become too expensive, taxes are too high and regulations and approval processes too costly and uncertain.

The second news item is one very few Australians would have noticed. Let me quote it:

“COMMSEC analysts say Tasmania should get more "mining boom" money from the Commonwealth since it is the worst-performing state.

“The latest CommSec State of the State report puts Tasmania at the bottom of the pile when it comes to retail spending, unemployment, construction work, population growth and housing finance.

“’Tasmania is under-performing other state and territory economies and arguably is the number one candidate of any regional income redistribution as the Federal Government seeks to share the benefits of the mining boom across the broader Australian economy,’ the CommSec March quarter report concludes.”

This alone tells us how dependent some states have become on mining in other states, especially ones with fewer green bans. What happens to them when the mining income doesn’t flow as much as once dreamt?

But notice also the sense of entitlement. Tasmania is doing badly, so other states must provide. We have lost our roots. Our pride in building and providing for ourselves.

Tasmania now has the highest unemployment rate of any state. That rate is more than twice that of West Australia. But its problem isn’t that it gets less mining money from other states than it now wants.

Consider for instance the price of its labor. In the US there are many people willing to work on $9 per hour, which is causing, Tasmania to lose its famous apple industry and Australia to import more and more of its fruit and food from lower cost countries.

In fact, all over Australia there are warning signs of us killing or restricting our own industries.

Take our fishing industry. It produces not only tasty barra, salmon, crayfish and prawns, but jobs. Income.

Yet even though we are surrounded by oceans, we import nearly 80 per cent of our fish. This should worry a conservationist as much as a professional fisherman, since we import from over-fished countries like China and Vietnam, which extract more than 5000 kilograms of fish per square kilometre, compared to just 30 kilograms here.

We have hurt an industry, without gaining a better environmental result. And our government is now looking at restricting the industry even further by creating massive new marine parks, throwing more fishing boats and fisherman out of work.

This is just one example, but hundreds of similar ones add up to a very big problem.

As I travel our wonderful country I talk to more people who are worried that outside industries and investments in West Australia and Queensland, things are looking increasingly grim.

The thing about socialist-style policies - the thing that media tends to overlook – is that policies that discourage investment and business don’t much hurt the very rich, but they do hurt the poor and the young.

The terrible millionaires and billionaires can often invest in other countries. And if they do suffer, what does that really mean? Maybe that their teenagers don’t get the cars they wanted or a better beach house. Maybe the holiday to Europe is cut short, but otherwise life goes on for those millionaires and billionaires. The bills still get paid and the fridge is still full.

No, those who hurt most when investments are killed off by taxes and green tape and socialist policies not friendly to business or inducive to investment, are those who usually vote for the anti-business socialist parties. And for them the price is very high. It’s a job lost, when they have few savings, a mortgage to meet and children to clothe and feed.

If you want to help the poor and our next generation, make investment, reinvestment and businesses welcome. For proof, look at the alternative. It’s called Greece. The millionaires and billionaires who chose to invest in Australia are actually those who most help the poor and our young. This secret needs to be spread widely.

So let’s drop the class warfare and recognise that high tax socialist policies don’t create jobs. Business and investment does, and we need a lot more businesses and investment and reinvestment to do a lot more of that creating.

There are, of course, things government can do to make this easier. Why not ask small and medium businesses what it would take to get them to invest more and hire more – and this time really listen?

They’ve already told the government this year that cutting red tape – and green – is critical. Action, please.

Why not ask even whether lowering the minimum wages and lowering taxes would make employers hire more people?

Too many of this publication’s readers it would just be common sense 101, even if it’s less common than it should be, but unless we keep spreading common sense 101 to more people we will continue to see our country replicate the problems facing Greece and Spain and other European countries who followed the big tax, excessive regulation socialist path and now have angry worried protestors in the streets.

There is something less definable that we must do. That is rediscovering our roots.

Another recent news item told of former Greens leader Bob Brown climbing 60 metres up a tree in Tasmania to visit a protester who was celebrated in the media for achieving a record. The record that caused this excitement wasn’t the number of jobs the protester had created, or the number of pensioners whose health care she’d effectively contributed to. No, she’d simply set an Australian record for a tree-sit, 209 days on a platform to stop loggers from harvesting a renewable resource. That protester’s achievements were lauded in the media, but Australia needs a new vision, or a return of the old – one that will make Australia progress, putting people in jobs and paying for their schools, hospitals and retirement and paying off Australia's record debt. I’ve always loved stories of the creators and builders, people who built something for Australia, probably because my grandfathers were two such people. Let me share stories about them, as they are examples of our roots. One, James Nicholas, started off cleaning stables for Cobb and Co on tiny wages. He never finished his schooling, because he had to go to work at a young age. He walked miles to work each day and knew what it was to work. In fact, he worked so hard that he eventually owned Cobb and Co in West Australia, and then gave hundreds of men work, building roads for the coaches and country inns for the passengers to rest in overnight and stables for horses to be rested and enable fresh horses to continue the journeys. The service he helped to build meant those in country areas could get mail and medicines, and materials these people needed who helped to further build the state. My other grandfather, George Hancock, lived in harsh country a thousand miles from civilisation in Perth, before aeroplanes shrank the distances.

He built up a sheep station in this harsh environment to carry 25,000 sheep, also giving work to many people who did the mustering, shearing and tending of the windmills scattered over the vast miles. Those jobs helped those men get through the Depression. How many such people it took to make this country. These are Australia's roots. My great friend Michael Kailis was from a poor Greek family, but became Australia's king of crayfish and prawn. He told me some of his first workers were from a local gaol, because he couldn't get anyone else to come and cut fish and crustaceans. He talked the local prison officer into letting him take the prisoners off his hands during the day, and returning them at night, too tired for trouble. Against regulations today, most likely people may even disapprove of this story, but from that start came a business that branched into fishing boats and facilities, and later pearling operations, that have given work to people from Perth to the far north of Australia. Another of my friends Lindsay Fox started with one old truck, barely roadworthy, yet his Linfox now employs 13,000 people, with many getting their first job through Linfox. Jack Cowin came to Australia from Canada and with loans he’d got together from his friends invested in a fast food franchise. Now he’s the Jack of Hungry Jack’s, and king of fries, giving many youngsters their first job and first training. Many people I know have through their own hard work and success provide work and enable success for others - Carla Zampatti, David Flanagan and more. Their stories differ, and so do their industries, but the lessons are the same: you can't get rich without working hard, taking risks, investing and reinvesting your profits. Yes you need that dirty word profits to be able to invest and reinvest, and you can’t get the profits to enable investment if costs and taxes are too high. Nor can you get rich without sharing this with others, as you can’t get rich without giving other people work and opportunities. We need to celebrate these people and remember our roots. I’m the kind of person who’d rather see a politician applauded not for having tea 60 metres up a gum tree with a protester engaged in stopping employment and revenue while our country is in record debt, but for having made it easier for a major project to get through red and green tape and then be able to hire thousands of people and earn revenue - the start of another great business for our country.

Our mines still produce great wealth, but not enough anymore to subsidise class warfare, complacency, overspending and a bureaucracy whose power lies in saying no.

Let’s get through the class warfare smokescreen. We need to regain our roots and encourage people to invest and build. There is no monopoly on becoming a millionaire, if you're jealous of those with more money, don’t just sit there and complain, do something to make more yourselves, less drinking and social time and more work time, become one of those who work hard ,invest and build, and at the same time, create employment and opportunities for others.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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