There's no hiding behind the facts. Australia have been completely outplayed by England in this Ashes series, an England side that aren't best in the world either.
The best thing Cricket Australia can do now is give the current team a finale in Sydney, push Ricky Ponting and Simon Katich into Test retirement and commit to a plan to be ready for the 2013 Ashes. They must look further than next summer or the next series - the depth of players currently isn't there in Australia, they need to start sweeping out the dead wood who consistently underperform - Michael Clarke, Mitchell Johnson etc and not let them back into the Test XI unless they show sustained form at a lower level, above and beyond their rivals. Phil Hughes is to be stamped 'NTPFAA' (Never To Play For Australia Again), his technique is far too flawed for international cricket.
A sustained period of success and the attraction of Twenty20 cricket has damaged Australia's cricketing future. Massaging the ego of Ricky Ponting, one of the game's best batsmen of all-time but a very average captain, has also hurt the country dearly. Giving him the opportunity to lose the Ashes three times shows the selectors have no balls.
Arrogance, flawed techniques and impatience have allowed a handy, but not exceptional England side to dominate Australia. Some of the dismissals have been due to sheer quality from the English bowlers, but not many. The majority have just been down to inferior decision making, a symptom of losing the focus required for the longer version of the game.
There should be a lot of changes in the Australian set-up after this series, from the administrators and selectors, down to the players, and then once they make their bed, they should lie in it, and commit to a programme. This may mean sacrificing series against India or South Africa in order to deveop our best squad long-term. If that's the case, then so be it. There's no point bringing in new blood, then chucking them out after two matches. They must be given some time to consolidate if they have some sustained form at first-class level in Australia.
It could be a long wait for Australian success again, it might have to be painful for a few years before we have a settled and clear best XI again.