THE DISTILLERY: Qantas mechanics

Each day, Distillery selects the three or four best ideas that have been put forward by the nation's leading business and economic commentators (and lists other items they have covered). Readers are invited to comment on the Distillery selections in The Conversation.

The unions have done their best to invite the conclusion that Qantas boss Alan Joyce is happy with arbitration, which is amusing because it's just as disempowering to the 45-year old Irishman as it is to anyone else. Nonetheless, it's presumed Qantas will get enough of what it wants to pursue its international strategy, but as The Australian's Matthew Stevens explains, the unions could appeal to the Federal Court to have the suspension of industrial action overturned and that could spell big trouble. Another commentator sees right through the delusional debt discussions in Europe and the US to notice explosive comments out of China on the global economy, while a little-known steelmaker and a division of Wesfarmers also come up for discussion.

We start with Stevens, who points out that a split between the engineers' union – which now holds a more favourable view of Qantas management – and the Transport Workers Union and the pilots union could produce a Federal Court challenge to the suspension of industrial action. Though Stevens says it's thought the court wouldn't be too receptive, the consequences will not have escaped Joyce's mind.

"From management's perspective, the biggest question now is whether the Federal Court will support the union application for a stay on the government's orders. If it does, the unions will be free to kick-start the industrial action and Qantas management will need to explain why commitments that the worst was over have proved unsustainable. And, worse still, it would mean the arbitration process is suspended for months while the courts consider the legal standing of the government's decision.”

Second in this morning's Distillery, The Sydney Morning Herald's Michael Pascoe picks up on some extraordinary comments from Chinese Vice-Premier Wang Qishan, who warned the world would see a chronic global economic recession as a result of the current international financial crisis. They're extraordinary because Reuters describes them as "the most bearish forecast ever by a top Chinese decision maker about the world economy”, and yet they've received negligible attention. Pascoe, nonetheless, finds an upside.

"What follows immediately is that Beijing is not about to engineer a hard landing in its efforts to smack the luxury apartment investors. In the short term, the message is being sent to Chinese banks to accommodate business needs (but preferably not real estate speculators). And in both the short and medium terms, the transition to greater focus on Chinese domestic demand gets yet more impetus. The rise and rise of the Asian consumer matters much more than the faltering of the Old World consumer.”

Meanwhile, we also have The Australian's Criterion columnist Tim Boreham, who adds to OneSteel's frustration by shining a light on specialty steelmaker Bisalloy, which – while admittedly modest in size with a market cap of $52 million – is not having the currency troubles of its senior.

"While OneSteel yesterday said demand had not improved, Bisalloy management pointed to 40-50 per cent earnings growth this year, off a modest base of $3 million. Bisalloy is the only local Q&T (quench and tempered) producer, with a 40-50 per cent share of the $190 million-a-year market. The rest is satisfied by importers, attracted by both the currency and robust domestic Q&T demand, mainly from the mining sector. By sourcing from Chinese and Korean suppliers (as well as BlueScope), Bisalloy negates the disadvantage.”

And finally, The Australian's John Durie goes inside the world of Wesfarmers and looks at industrial and safety boss Olivier Chretien, who has just returned from a two-month stay at Harvard, to draw some conclusions about how the conglomerate operates.

"Innovation was the clear message from his sojourn. Industrial & Safety and Insurance are the smallest Wesfarmers divisions by some distance. But while producing just 14 per cent of Coles' earnings, Chretien's returns are 1.6 times higher. In part, that's how the machine works, with the mainstays ticking along earning stellar returns while the effort is focused on the big bets like Coles, which, if managed well, will in turn create the same returns and provide the growth.”

Turning back to the Qantas industrial dispute for the rest of this morning's commentaries, The Australian's Jennifer Hewitt chimes in to argue that Joyce is being lauded by the business world for being the implied spokesperson of the Fair Work Act's growing problems.

Elsewhere in company news her colleague Bryan Frith examines the fading Oakajee dream of Murchison Metals and concludes it was never much more than a dream, while Fairfax's Insider columnist Ian McIlwraith suspects ever so slightly that billionaire Kerry Stokes might have won National Hire's Dale Elphinstone.

Meanwhile, The Sydney Morning Herald's Ian Verrender gives a more complete history of global resource taxes than the mining companies would ever be willing to concede to argue quite convincingly that the MRRT is a very reasonable proposal. Fellow SMH writer Matthew Wade offers a telling insight into the staggeringly bad reputation Australia cultivated for itself after the spate of attacks on Indian students and how lifting the uranium ban would at least address the perception Australia's discrimination against India is not institutionalised.

And finally The Australian Financial Review's Chanticleer columnist foreshadows a tough 2012 for local pharmaceutical companies as a number of blockbuster drugs lose their patents.