You get what you pay for !

Gina Rinehart, the world's richest woman - ignited a firestorm when she complained that Australian wages are too high.  She says we are becoming uncompetitive because labour can be hired in Africa for just two dollars a day.

She seems to have missed a news story coming out of South Africa recently.  A Platinum mine there is on strike because the workers are demanding more money.  They are paid our equivalent of $ 500 a month - which is sixteen dollars a day - and the workforce lives in shanty conditions, far removed from their wives and children, to whom they send sustenance money.    This strike became so serious that the police used machine guns to fire into the crowd, killing several miners.

Unrest in deprived countries where lack of work has driven wages to desperation levels is common.  A mining company thinking of expanding there because of low wage levels would be wise to consider the risks. A valuable gold and copper mine in Bouganville, New Guinea has been idle for decades because of a raging civil war by native people opposed to the ecological damage - and the pay levels offered.   Millions of dollars of development money is now unproductive in such circumstances.

Africa certainly has a treasure trove of new mineral discoveries, but it is also known for civil war.  Large parts of the continent bring forth names synonymous with tribal war.   Angola.  Congo.  Rwanda.   Half of Niger is now under al Qaeda control.    There are good reasons why those thinking of mining investment must weigh up the balance between a cheap labour force - and the risks that political uncertainty bring.

There is another question that should be on the minds of most Australians.   We are having a mining boom, but with that comes an expectation that every new mineral discovery will be an instant new development attracting billions of dollars.    This seems to fly in the face of sustainability.

If too many mines come on line at the one time, we create a glut of whatever is mined, and that leads to a sharp drop in prices.  There is only a finite amount of minerals on planet earth - and we expect our ever increasing population to be here for a very long time.    The present thinking seems to be a " dig it up and sell it " approach, rather than a " slow and steady "  continuation of our mining sector.

The mining experience has long been " boom and bust ".   Australians are not going to work for two dollars a day and as a consequence we are going to get competition from Africa and other parts of the world.  The last thing we need is a panic move to extend mining at any cost to keep our economy bubbling.   We will be better served by keeping some of those new discoveries in the ground - for a later era - and concentrating on improving our job economy along more traditional lines !