Dollar will dazzle as long as deficit is a dirty word

So environmentalists are busy on social media celebrating their "saving" of the Kimberley as Woodside dumps the plan to process Browse Basin gas onshore at James Price Point.

So environmentalists are busy on social media celebrating their "saving" of the Kimberley as Woodside dumps the plan to process Browse Basin gas onshore at James Price Point.

Wonder if they spare any thought for the indigenous land owners who wanted the project and now won't get the employment and billion dollars that, used wisely, could have transformed their marginalised community.

But it wasn't the anti-development campaigners who stopped James Price Point, though they certainly didn't help and might have made a marginal project more marginal. In the end, as Woodside chief executive Peter Coleman made clear, it was the money: processing at James Price Point no longer added up.

With the longer-term price of LNG under threat from unconventional sources in general and perhaps the US in particular, the rising cost of building whopping great big things in the north-west has become prohibitive.

Part of that has been poor management, part the laws of supply and demand having their way with scarce resources in a distant and difficult environment, part a couple of greedy unions and part the strength of the Australian dollar.

It's the mighty Aussie that's copping the biggest kicking at present though. It seems you can't be a CEO without having a whinge about the currency and saying "they orta" do something.

Wayne Swan just throws up his hands in dismay — the dollar is defying gravity and lower commodity prices, he says. This bloke is the Treasurer.

It's been left to the Reserve Bank to try to explain the reality to the few who might want to listen: it really isn't all about us — it's about them. The US, Europe and Japan are debasing their currencies by printing money. And, no, we wouldn't need, or want, to do that.

And we can't just cut our interest rates to zero either. Monetary policy is a bit more complicated than digging up dirt and shipping it to China.

There is a big idea that could both exploit the strength of the dollar and help weaken it while improving the nation's current and further economic health — it's the idea pushed to a greater or lesser extent by at least five present and former RBA directors that the federal government should borrow very, very big and invest in infrastructure.

But that's not going to happen — the politics of surplus worship are too ingrained now to permit either side to do it. And I somehow suspect the business lobby is too squarely behind the Coalition, which leads the way in spreading fear about government borrowing of any kind.

The strong dollar has done some good things in allowing us to experience a massive commodities boom and rise in national wealth without the economy falling apart.

The currency remaining strong forces us to get better at what we do, it forces us up the value chain. The good companies, the CEOs worth some of their pay, are getting on with dealing with that, with building smarter, more productive organisations. It's not easy and some don't survive.

Meanwhile, back on the north-west shores of Australia, Woodside's Browse Basin gas will still be developed — it's too good a resource not to — but the gas is likely to be liquefied on a massive floating platform that will be built in Asia.

Yes, James Price Point is beautiful, but all of the Kimberley is beautiful — and there is a vast amount of it. Industry and rational conservationist values can co-exist. The Kimberley is big enough for both. Or it was.

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