TAFKAS likes smoked salmon. Let’s not go through a debate on the subject.
Fortunately for TAFKAS though, there is a wholesaler near his home who sells retail. This wholesaler sells 2 types of smoked salmon: Norwegian smoked salmon and Tasmanian smoked salmon.
This is not a high school maths problem, but …
The Norwegian salmon costs $32 per kilo. The Tasmanian costs $40 per kilo.
The cheaper salmon needs to travel 16 times the distance than the more expensive salmon.
What is the difference that explains a higher price for the product that needs to travel the shorter distance? Some might say branding, quality, blah blah blah.
TAFKAS might suggest electricity. A significant component in the price of smoked salmon is the electricity used in refrigeration (freezing).
We can pretend green jobs, but TAFKAS can’t imagine in the great global competitive challenge, most of Australian manufacturing at all competitive. Which is why our major exports are resources and services.
Once upon a time, Australia’s distance and high cost of labour (per unit of productivity) could be compensated for by low energy costs. No more. No longer. No how.
If people want to talk about the lack of manufacturing in Australia, they should start with that. They can waffle the latest buzz about advanced manufacturing but the reason it is advanced is that it is roboticized and computerised. Not too much labour involved.
So future Australian manufacturing will be high capital and low labour to compensate for the high cost of labour. No matter the output of Prime Minister Morrison’s Accord Mark Who, you just can’t compare the productivity of an average union member and a machine that works 24/7, doesn’t take sickies and doesn’t talk back.
Sadly, the damage has been done. And the green jobs of the future will be sitting in the park and collecting welfare with an ever diminishing purchasing power.