[wisty]

A bigger problem is the brain drain government spending creates. Why risk your neck for a startup, when you could work on a fat government IT project?

And digging up rocks is not a good long-term plan. The commodity market has a little thing called "mean reversion". Basically, nobody cares where the rocks come from. Australia has a slight advantage over other countries, because our rocks are pretty good quality, we have reasonable governance and management, and we are close to Asia.

But, there's only a massive premium because China's demand has grown faster than supply. Once the resource companies pull their finger out and start digging faster, prices will drop right down. Rocks aren't iPads - nobody cares where they come from. If Brazil or South Africa or Nigeria or Russia can dig up similar rocks, or China funds a bunch of new resource companies in Australia, supply will start exceeding demand and the price will go back to around the cost of production.

It takes a long time to get the mines set up (there's something like a year's lead time on the tyres of mining trucks), so there's a few years (maybe a decade or so) in which miners can charge as much as the market will bear. After a while, supply will increase and the market will start asking for big discounts.

That's how commodities work.