BHP was once famously called “the Big Australian”; its CEO Marius Kloppers evidently prefers “nominal Australian” for himself, at least when talking to US diplomats. As this nominal Australian smirked his way through the announcement this week of a record profit — putting BHP-Billiton on track, according to one British newspaper, to record “the biggest profit ever made by a British company” — he had the additional satisfaction of knowing his profit announcement would enrage those who had supported the Rudd government’s RSPT.

The vast half-year profit unveiled by BHP — the first of many to be revealed by miners this reporting season — vindicates those who repeatedly pointed out that the mining industry — far from facing the Armageddon predicted by the miners — was in such rude health it could afford to pay the RSPT and more. Needless to say, that hasn’t stopped their ardent propagandists — for example, Business Spectator’s Steve Bartholomeusz in Crikey yesterday — from insisting, with not a skerrick of evidence, that agreement on the MRRT had unleashed a “wave of investment” by miners.

Still, no use complaining now. The British companies BHP-Billiton and Rio Tinto joined up with the Swiss Xstrata and the American-Saudi News Ltd (tax dodgers both) and engineered a best-practice example of regime change. The three miners then negotiated a hasty backroom deal with a desperate replacement Prime Minister that reduced the new tax to a pittance. They were in such a hurry that various undotted i’s and uncrossed t’s continue to require resolution months later.

The steady drip of record mining profit announcements will continue, each one serving as a reminder of the culpable ineptitude of this government — the Rudd model, which wrote the How-Not-To book on tax reform, and the Gillard variety, which so cravenly surrendered to the miners.

No wonder every industry now routinely threatens a “mining tax style campaign” if it doesn’t get what it wants from Labor.

The media played its role in that debacle — not just News Ltd, which acted as a propaganda arm of its fellow transnationals, but others as well, especially at the Financial Review, which unusually let its editorial line infect its non-press gallery reporting. But the disaster was almost entirely made in the office of the Labor Prime Minister, regardless of who the occupant was.

We know that because, for once, we have a counter-factual. It’s not just miners announcing record profits. The Commonwealth Bank announced a record half-year profit last week and the other members of the banking cartel all have first-quarter profits that put them on track for record or near-record profits. The banks constitute one of the single most hated sectors of the community. And NAB head Cameron Clyne explicitly welcomed a debate on a banking profits super tax. But when faced with a fiscal difficulty engendered by the floods and cyclones, where did the government look for a slug to top up revenue? Straight at PAYE taxpayers.

In fact this government won’t even consider taking on the banks over competition and regulation. On this issue, Labor actually found itself to the right of the Coalition, after Joe Hockey took up the cause of addressing banking competition and establishing an inquiry into banking regulation following the GFC. The package of competition reforms Wayne Swan produced in the face of Hockey’s success in running with the issue was modest and sensible but failed to get to grips with the issue the cartel simply doesn’t want touched — their too-big-to-fail status within the Australian economy.

In short, even when Labor had the Opposition and a range of leading economists urging it to embrace serious reform of banking regulation, it wouldn’t do it. Instead, Swan’s minimalist package unfortunately now marks the high-water mark of banking regulation reform for this term of government.

Labor is now, deservedly, left with the consequences of its retreat to a half-baked mining tax. It is getting hammered by the Greens for not taxing the miners enough, and it is getting hammered by the Opposition for having any tax at all. And it’s getting hammered by the media because of the fiscal impact of the switch from the RSPT to the MRRT, without a sufficiently savage pull-back on the expenditure associated with it. It’s out in the open, hopelessly exposed and under fire and the Prime Minister is insisting that’s right where Labor will stay.