Should the Australian Government provide money to car manufacturers to prevent them from moving their operations overseas? Discuss, drawing on contemporary debates about this issue in the news media?
The Australian Government should provide money to car manufacturers to prevent them moving their operations overseas. The car manufacturing industry provides jobs to many Australians and by moving operations overseas many Australians will lose their jobs. Due to the recent overseas relocation of Ford and Toyota there has been a “loss of.. 50,000 jobs” (Martin, Feb 12th 2014, SMH). By losing their jobs, Australian workers are being left stranded without an income and the inability to work in the industry they have been trained in for most of their careers. By the government giving million dollar packages to major car manufacturing companies such as Holden, they are giving employees payouts to assist them after they leave the company. Also by giving companies huge subsidies, they are trying to help them not to move their operations offshore into foreign countries.
However by giving car manufacturing companies such as Holden and Toyota huge payouts, the common Australian taxpayer is left to fit the bill. Many critics of the Australian government’s huge subsidies are questioning whether it is worth pouring millions of dollars into an industry which is closing down operations in Australia by 2017. David Sinclair, a Professor of Economics at RMIT said that “you can’t just really buy Australian jobs by tipping corporate welfare into corporations; we actually need to have viable businesses that can survive without that sort of corporate welfare” (Sinclair, May 23rd 2013, ABC). By assisting car companies with subsidies, they are solving a short term problem and not thinking about the long term future of the company and its employees.
The Australian Government shouldn’t be