I also agree with you Peter from the added perspective that I was an investor in Gunn's 10 years ago but shed all of my interests about 7 years ago because of the direction I could see things going. The really sad thing is that the 500,000 odd people who live in Tasmania need work, need a sustainable income and viable businesses to generate the tax revenue etc. to sustain the expected lifestyles & services. I know Tasmania well - a beautiful gem in the Australian crown. .... There is one problem. Tasmania inc. probably only responsibly & sustainably generates enough income to support a population of about 200,000 [a wild guess!!] productive [not retired] people.

Tasmania has been given the honour of being the second best place in the world after China to invest in the wine industry. Gunns sold their vineyards to concentrate on woodchips.

Whilst not unhappy with what has happened, this "win" has consequences. Tasmania Inc. is living way beyond its means and has been for some time. This industry demise & this companies demise leaves a huge income hole for the state. One of the people services dear to my heart, health services, are struggling severely because of income issues. This is just a small window looking into the problem that Tasmania faces. Income into the state has to come from somewhere. quickly. sustainably. and sufficiently to sustain the needs of 500,000+ people.

This conversation needs to draw these answers out as well as bask in the good feeling of a further extractive industry decline. [Following on from Queenstown Zinc & Savage River Iron ore]. Where is the future that will fill the gap? Tourism? Truffles? Hops? Exotic natural timber furniture? Lavender? Opium for the legitimate drug industry? Potatoes for McDonalds? Green vegetables? Lobsters? Pelargic Fisheries? Antarctic support? Wines? Berries? Apples? High Tech Catamarans? ZInc smelting?

Tasmania has to be able to earn replacement income on the world stage. I don't have a practical contemporary answer. Does anyone else?

This is how a recovering economist would look at it Kim:

Tasmania has a few comparative advantages - over the rest of the Australia and globally. Clean - that's the big one.

So high value food production... cool climate stuff into the rest of Australia and niche market product into Europe and the USA and Japan - off season. Top end of the market only. Not high volume. That includes wine.

Same with fisheries and mariculture of Tuna in particular - straight to Japan and China. Very serious specific marketing required. Joint ventures with local distributors... watch your fingers.

Basically the idea is to look at what is special about Tasmania, the opportunities and the limitations and work on building an economy on those foundations. Not a quick fix - but a 10 year strategy in which training and education are central. Together with some policies to encourage industries that meet the clean, high value, exporting criteria. Not picking specific winners but a broad thrust of encouragement to these sorts of ventures.

I still reckon that with a carefully managed approach Tasmania could be exporting green power to the rest of Australia from wind turbines in Bass Strait and off the West coast.

Tourism is also big - most is from domestic tourists - so large strategic campaigns and links into Asia would be sensible - notably China.

The other option - as suggested by one of my wicked mates this morning - is to make use of the talents of some of new arrivals from Afghanistan especially those who know how to move a lot of poppy product quietly. He's a shocker!

Hopefully the Tasmanian Government has been looking at this (not necessarily the last one) and are not just clinging to the wreckage of logging and pulp mills. Let's see.

I agree entirely with your thoughts and sentiments Peter. However, my pragmatic streak ponders the tyrannies of distance and the uncompetitive cost of Australian labour, even at its 'productive best'!

It always amuses me, when people go on about "high cost of labour", there is not one country in the world with low wages and a general level of prosperity, not one.
You can have a wealthy elite and the vast majority living in poverty, i.e. India,but to have most of the population enjoying a decent standard of living you have to have good wages, realistic taxation and good governance.
Low wages are the path to corruption, nepotism and poverty.
As an Orthopaedic Surgeon do you think you would enjoy your high standard of living if we had low wages?, and only the wealthy could afford your services, poor countries don't have Medicare and PBS.
You people don't understand basic economics, the workers spend their money which finishes up in the pockets of the rich, the rich use their wealth to create more wealth, creating jobs is a by-product, its not in their remit or their DNA, and the less people they have to pay the better..
The biggest joke is lower wages and create jobs, if this was the case there would be no unemployment in poor countries.
The USA is a prime example they have been cutting wages for years as they slide slowly (but at a steadily increasing pace) down the gurgler, the wealthy are obscenely rich and keeping it to themselves, and the workers are the working poor, crime and drugs are rampart, sounds great don’t it.

I'm not sure that Kim is suggesting that Alan. I hope not anyway.

You're dead right of course - there are good things that happen as a result of higher wages - not the least is the spur to innovation and capital investment, not to mention a generalised higher living standard.

One of the most useful criteria for analysing an economy is the disparity between the rich and the poor - the level of inequality. On that basis the US - or at least certain States - should be considered part of the Third World incidentally.

I'm not so critical of the productivity of Australian workers. I am rather more critical of the productivity of Australian managers - the sorts of fellas that ran Gunns into the ground. Depending how one looks at it - a lot of what we do is not productive at all. No matter how hard one works.

Gunns did not have a productivity problem - they had a management problem. It would not have mattered a jot if their workers were all pulling unpaid double shifts or using a chainsaw in each hand.

To my way of thinking productivity must be more than a bit of arithmetic subtracting unit costs from units of output.... it must be first and last productive... leaving something useful and with value for the future.

Tasmania does in fact have lower wages than the mainland. Saul Eslake did a good article on that some time ago but argued that even though we have lower wages, the lifestyle is higher. All to do with neighbours helping each other out.

Thanks Alan for the "personal attack" and misreading of my comments - makes me feel at home 'on-line' as well. I should obviously hide under an anonymous name & title so as not to evoke vindictive perceptions. I am rather proud of my professional standing having come from very humble roots .. oh well.

In the big picture - i.e. the world stage, we all have to be able to gain and deserve an income from our skills or our endeavours whether it be monetary or 'in kind'.
That income will come from someone else being willing to pay for that endeavour. We, in Australia, have a problem. To state the obvious, unless we have a product that can be competitive in that world or Australian market, we don't get an income. Tasmania has a problem in that it doesn't have yet enough quantum of competitive product to fill the gap that is being created by the loss of the "extractive" timber industry. Product options, distance & cost of production are the devils in the detail. We, in this conversation, have to be innovative, forward - thinking an able to create an economic 'point -of-difference'.

Gee Sean,

Have you considered why no other commenters here expressed such a talk-back viewpoint? Anyway thanks for waving the redneck flag just to remind us how far there is to go. The Greens done it innit? Ort was it the guvvermint? Or thet Carbine Tax? Or the green tape regulations on thet pulp mill thing? Or them Banks? Or the world conspiracy agin Tasmania?

Bugger if I can work out how you can type and scrape your knuckles at the same time.

Anyway, you've raised this rather curious notion of a "Liberal Totalitarianism" on a few occasions. Why not take this obvious opportunity to flesh out this rather paradoxical analysis of yours for us all here?

http://rulingclass.wordpress.com/2012/05/07/liberal-totalitarianism/

http://www.edmundburkeinstitute.org/documents/The_Just_Cause_Liberal_Totalitarianism.pdf
N
He is away with the fairies.
Yep, them nasty greenies twisted the Japanese's arms up their backs to buy cheaper woodchips from Japan, which incidently is just around the corner from Japan, lower transport costs.
It has been known for at least 5 years that woodchips were in the sunset phase, Gunns in their arrogance couldn't or wouldn't see that.

Why does closure of so much of Australia's manufacturing base with relocation to exploited cheap labour overseas, pass us by with barely a whimper? Yet when an industry that specialises in destroying ancient forests is finally brought to account, the (un)Conservatives crawl out of their piles of wood chips, wailing "the Greens, the evil Greens?"

Tasmania has a chance to return to being a pollution free jewel in Australia's crown - it will require imagination and innovation and may well lead the way to a clean sustainable future.

Just move the population out, eh, Dianna.
By the way, Dianna, did you know that trees produce seeds. I wonder what they would be for?

Tasmanians seem to have a naive idea that trees are unique to Tasmania.
http://www.nps.gov/redw/planyourvisit/tall-trees.htm
http://news.nationalgeographic.com/news/2008/04/080414-oldest-tree.html
The Gold Coast attracts more tourists than poor old Tassie.
http://wetnwild.myfun.com.au/?WT.svl=WnWFoot

" Forestry is one of the few truly renewable industries..."

Plantation forests are renewable.

Not so old forest with its reliant understory of flora and fauna. Simply replanting a single species of tree after clear felling is not responsible and does not bring back the animals and plant species which die from lack of habitable environments.

Dianna

With respect, you don't know much about forestry if you think harvested native forests are re-planted with a single species. That happened to a proportionally minor extent mostly from the 1960s to 80s to establish our softwood plantations, and to a lesser extent more recently in establishing eucalypt plantations, although most were planted on cleared farmland.

However, the vast majority of harvested 'old forests' as you put it are re-seeded with a mix of the overstorey species replicating the original stand composition, and over time the understorey species regenerate much as they do after a bushfire event. Eventually, the fauna re-colonises as well, in fact some are back in just a couple of years after logging, inc supposedly endangered species such as the Long footed Potoroo. If left long enough, these forests will be indistinguishable from what they were before.