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Don’t You Feel Like A Failure When You Earn $15 Billion?

23 Aug 2012

When is a $15 billion profit not enough? I suppose when you are at the helm of BHP and do not want to pay a fair share in taxes in return for digging up the minerals that are making you rich.

It’s not, as the Sydney Morning Herald tells us, a day to cry at BHP:

The group is still highly profitable. Underlying earnings before interest and tax fell 14.8 per cent to $US27.2 billion, but that was still a very [sic] 39 per cent share of revenue, and BHP’s underlying return on capital invested was 23 per cent.

I’m assuming the missing words in the sentence above were “big haul” or “monster profit” or something. It is not something to wring ones hands over, as CFMEU National President Tony Maher points out. That profit is still the second-biggest corporate profit ever recorded in Australia and more than double the highest profit made in our next most profitable sector – banking. Maher continues:

Don’t be fooled. This is a massive profit, greater than the GDP of over 60 countries. BHP shouldn’t have to be dragged kicking and screaming to do the right thing by its workforce, by mining communities and by downstream Australian businesses trying to benefit from the mining boom.

The worry should be that BHP will use a lower, but massive profit, to try to squeeze workers and continue to fight a reasonable resources tax. Maher also points out, though, that any higher costs are not about workers’ wages:

Where mining companies are looking to cut costs, the protracted record-high level of the dollar is to blame. Australia’s mining boom is going to continue for many years into the future. For the sake of jobs across the whole Australian economy – it’s time for some serious action to take the heat out of the dollar.