Opinion: Bernard Hickey says both National and Labour are still using the enablers of borrowing and asset sales to encourage NZ to live beyond their means

Opinion: Bernard Hickey says both National and Labour are still using the enablers of borrowing and asset sales to encourage NZ to live beyond their means

By Bernard Hickey

With just a few days until the election, my main thought is: a plague on all their houses.

Aside from the usual distractions such as the teapot tape and debate atmospherics, this has been a frustrating election campaign because none of main parties have addressed New Zealand's main problems.

See all election policies compared on our site here.

It's almost as if our politicians have been scared of the problems themselves and what the voters might think if they talked about them honestly in the light of day.

Ultimately it is a failure of the voters themselves to demand a proper debate, and of our electoral system, which rewards incremental change and a three yearly auction for marginal votes paid for with future voters' money. New Zealand's system of governance has become a short-sighted vote buying exercise where electoral success is won at the expense of future generations. Ultimately it is not sustainable.

The rot really set in in 2005 as Labour scrambled for a third term. Helen Clark realised Labour needed to buy the votes of a disgruntled middle class and of students if it was to retain power and she chose to spend hard-won budget surpluses on a dramatic expansion of Working For Families, interest free student loans and 20 hours of 'free' early childhood education.

Despite criticising them at the time, National signed up to keep these bribes in the 2008 election and has kept them for 2011. National went further by cutting taxes for higher income earners, which cost the government almost NZ$3 billion in the first year and was paid for by borrowing, mostly from foreign investors such as the Chinese government. National is even planning to further enable voters' willingness to spend now and forget about the future by selling state assets to pay for NZ$5 billion of current spending.

National's figleaf of a fund to spend the asset sales money on infrastructure is just plain false advertising as long as the government is running a deficit on day-to-day spending.

Labour is no better. It is also keeping those 2005 bribes and promising to extend Working For Families to Non-Working Families, as well as spending even more on Early Childhood education.

The net result of last 6 years of election bribery is an extra NZ$40.86 billion in debt that future generations will have to service and repay. Excluding the cost of the earthquake, the government has run a budget deficit equivalent of 4.6% of GDP in the last year.

To be fair to Labour, it has raised the politically painful issues of a Capital Gains Tax and a phased introduction of a delay in the age of eligibility of NZ Superannuation to 67 from 65.

But neither main party has directly addressed the national tragedy of long term youth unemployment running at 25-30%, which is in line with the rates seen in the United States and Egypt, or how to transform an underclass of people stuck on welfare. This will create another lost generation of young people who will be beset by health problems, social problems, low self esteem and grinding poverty. Neither party is seriously looking at youth rates, expanded apprenticeships and any social reforms to attack these issues directly.

Neither party is also addressing the disaster of a lack of new house building, which is feeding into housing cost inflation, particularly in Auckland.

Finally, neither has addressed the risk raised by Treasury in its Pre-Election update of a meltdown in Europe's financial markets crippling global and local economic growth. What are their Plan Bs?

It seems we won't find out until they make up a Plan B on the spot in the weeks after the election. More short termism from parties intent on consuming the future to stay in power for now.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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Bernard - excellent analysis.

Over the years, the short term sugar highs have slowly converted the NZ voter into a zombie with limited ability to look beyond the simplicity of their immediate needs. Our short span of concentration has helped the victory of style over substance.

At least we don't have to choose between dumb and dumber but instead vote for a minor party with a genuine and committed concern for our future generations.

Out of a 4 week campaign the media took it upon themselves to waste one entire week with the " storm-in-a-teacup " ....... that hacks me off , Bernard . There's real issues to be aired , and they got overlooked , in a mad scramble to see if one John told the other John that Don Brash was past it , and that Winnie's supporters were falling off the peg .

...... with hindsight , it was a lucky break for NZ when our agricultural produce was tarriffed out of Europe in the 1970's , by their militant subsidised farmers . Our need to find alternative markets has stood us well , in the current European turmoil .

Your comments regarding 2005 , and the extraordinary election bribes echo Don Brash's criticism of them , at the time . Old dithery duffer he may seem , but Dr. Don is no fool . He knew the damage that Michael Cullen was doing , in order to bribe another election win for NZ Labour .

I thought you might be pleased with JK's performance, not only did he manage to avoid talking about the real issues (phew) it kept Phil Goff out of the media for a week. What more could a NACTer want?

. .. it puzzles me , Les , that people here automatically assume I like Jolly Kid & National , on the basis that I loathe NZ Labour .

JK is a populist .... I have absolutely no time for him . We need pollies with some vision and decisiveness ...... and only the nearly departed Dr. Don fills that bill . All the other parties and their leaders are squabbling over who gets what in the entitlement game .

Having said that , my party vote will go to Greens . A plague upon both National & Labour !

. .. to show you how foolish the voters are , in the Waimakiriri ( my new electorate ) , sitting member Clayton Cosgrove is only 36 % , in the polls ...... but Kate Wilkinson is polling 54 % . She's appalling ! The most useless " performer " within the cabinet in my memory . Clayton by comparison , has served his electorate very well , and been a good man in government !

"it puzzles me , Les , that people here automatically assume I like Jolly Kid & National , on the basis that I loathe NZ Labour ."

It's simple really: you use childish nicknames for non-National party members ("goofy", "cunny", etc), and generally accuse them of all kinds of dastardly deeds, while pretending you don't fanatically support the National party. So in other words, you're just another Wolly.

I too would vote for the greens but.................

I simply cannot support a party that would decriminalise drugs. 

How a party that so strongly supports environmental purity, pure health and food can totally blow their credibility by supporting something as physically and mentally damaging as Marijuana is quite beyond me.

If only marijuana was good for us like alcohol. Alcohol cures all ills. Nobody has ever died because of alcohol. Thanks the gods that alcohol is legal and that dreadful marijuana isn't!

LOL

The problem is that marijuana can be grown in your garden without even trying. So I am told. Alcohol of course has proven easy to regulate and tax. We can't have people running around on untaxed highs can we?

The most damaging thing about cannabis is the organised-crime run black market.  Eliminating that would be nothing but good.

Well, except for gang members who'd take a hit on profits.

Chris-M   .....Fools like yourslef seem to think their is a link between making something criminal and the propensity to use it.    Look around....we have spent millions 'fighting' drugs, but the results of this fight have been nil.  Those who want to smoke/sniff/inject can still happily do so...the only probem being the cost , quality and inconvience.

Every time the cops make a bust, the prisons fill and the market responds....the next tier of dealer merely ascends the ladder to replace those incarcerated.  Hence, the more active police are, the more crime there is.

Brash was onto it, but got shouted down by idiots like Banks.

 

 

Someone may correct me on this , but the Greens appear to want to legalise cannabis useage , whereas Don Brash mentioned decriminalising it .

... The difference being the terms " legalise " and " decriminalise "  is  subtle , but very important . .. .but many folk seem to believe that they are one and the same thing .

make the whole damn lot legal...but cut back on State funded assistance. 

Heard first hand of a druggy getting new veins ..surgeons took veins from legs to put into arms.  Very expensive and protracted operation..in the tens of thousands of dollars.  But this person was still a druggy, there ws no obligation to give up before or after the operation....so  left hospital with new veins to pump up..and be destroyed again. 

as they say...go figure?

This is a very mis-informed view. Currently too much money and resources are wasted policing, prosecuting, and incarcerating people for using a plant. It has been shown time and time again that prohibition doesn't work. Interestingly Portugual decriminalized drug use in the early 2000's, since then the rates of drug use have dropped and they have saved millions of dollars.

Further more, if you bother to look at the evidence you would clearly see that marijuana is far more benign then most other drugs - including the NZ favourite: alcohol. Have a look at this drug harm classification taken from The Lancet medical journal for an unbiased view of drug harms ( http://news.bbc.co.uk/2/hi/6474053.stm#drugs ).

All of these publications have shown marijuana as being far less harmful than alcohol in terms of to harm to self, and also harm to others. If marijuana is as evil as you say, then banning alcohol (which is far more dangerous) is obviously a no-brainer - I'm sure you'd whole heartly agree to having this done?

 

Spot-on GBH!

Kate Wilkinson is the biggest, most useless snake in that cabinet followed closely behind by Phil Heatley (am I only the only one who thinks it strange that the Minister of Fisheries doesn't actually know how to fish??).

 The conservation estate is sadly in very poor hands under KW.

Although asking the good folk of Waimakariri to split their votes is unfortunately asking a bit too much... I'm not convinced they understand how MMP works.

Many thanks Gummy

Alex and I agreed we wouldn't cover the storm in a teacup. That's why we stayed away from it and focused on the issues we thought interest. Deficits. Taxes. Economy

cheers

Bernard

I would agree with your assessment. Media chasing headlines instead of issues and real news. That's the trouble. We are sheep.

Here is a site concentrating on real issues:

http://www.changenz.co.nz/

Another concentrating on the real economy, enjoy:

http://www.realeconomy.co.nz/223-rbnz_must_explicitly_target_no.aspx 

The "teacup" or "teapot" fiasco, or whatever you're calling it, is not as trivial as John Key's fanclub would like everyone to believe it was. It emphasised Key's hypocrisy and shallowness, and his inability to deal with his own messes in a practical manner.

He invited the media to that event. He told the world all about it beforehand. He smiled, he waved, he looked smug and sounded unctuous, but it never seemed to occur to him that anyone but himself and Banks would ever know what was being said.

When word got out, he panicked and invoked the Dictator Clause: blame everyone but yourself and send in the storm troopers.

NO Malarkey there my friend! And I think the thumbs up agree! It's a slippery slope when the cops do the pollies bidding raiding TV and Radio stations, for political purposes!

I think there is room for  a new pressure group to stray from  vote catching policies and show case some real policies that address growing debt ,youth unemployment etc. If there was such a party many of us disgruntled with the current showing would give them our protest vote. The greens currenlty fill that position for me. They have no desire to govern therefore can stick to real policy be it in the green area. 

I suspect you are underestimating National's political nous here Bernard.

If I read the tea leaves correctly then I think National are hoping to be given a clear mandate to get on with things. They had to peddle very gently to get elected last time as they were not really trusted but were elected because everyone was fed up with Chairman Helen.

National have been very canny in office. They resisted the temptation to make radical changes during a crisis. Personally I would have got in there with my axe swinging, but then i am a simple fellow. They figured if they did that there would be a backlash at this election. Instead they chose to make gradual changes at a pace that New Zealanders could go along with.

If National get the result they are hoping for then I think you will see the rate of change move up a gear. So fasten your seatbelts, who knows what they will get up to, but hopefully some good will come out of it.

 

Yet they seem to be handing the platter to Winston Peters.

You assume there is radical in there.  The campaign platform and the mandate they will get (probably) shows no signs of the freedom to "get on with things"  or radically swing to the right you suggest.  Sure they could, but doing so which would see them probably lose the 2014 election and spend many years in the wilderness.....I dont think they are that short-sighted/stupid...

"good" is open to defination / opinion.....I very much doubt my "good" and your "good" are anywhere near the same thing.

"fasten your seltbelts" will I think come in 2013 or 14 I dont think we will be anywhere near paying off, assuming we stagger along as present.  I think its far more likely however that the EU will implode and take out the USA etc next year....that means the start of a 5 or 6 year drop into a depression.  Im not so sure you will see what you think you will be want to see....time will tell.

regards

 

  

Yes, well I'm not even sure what i want to see. An end to the stagnation that settled on NZ during the Clarke years I guess. Not that Auntie Helen was all bad, she kept us out of Iraq and stopped us adopting the Aussie dollar.

 

Roger Witherspoon,

Are you kidding? During the Helen Clark years, may have plataeud, but that largely because the economy didn't experience the dramatic fluctuations that it did under the National Party's watch either. Check out the graph of GDP growth rates in the webpage linked below. During the National period, its highest growth rates were when the economy emerged from deep troughs. And during Clark's administration GDP growth rates were consistently within a percentage point of National's peak rates. Not to mention the fact, when Clark left office, the biggest complaint economists had was that our employment rate was too high.

http://www.indexmundi.com/new_zealand/gdp_real_growth_rate.html

The Bank of New Zealand's head of research, Stephen Toplis, said the tightness of the labour market was the single biggest problem facing the economy. Job security left people feeling "bullet-proof" and comfortable spending up large both on housing and through the retail sector and becoming less resistant to price rises, he said.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=1045...

@ Roger Witherspoon - If National get the result they are hoping for then I think you will see the rate of change move up a gear.  

Recent comments (below) by Bollard, noted on this website, suggest change will be dictated by offshore technocrats and not by our duly elected officials and their stated policies. 

'Bollard said the Reserve Bank's so-called Open Bank Resolution (OBR) policy was something recommended by world regulators to avoid 'Too Big To Fail' banks holding entire countries hostage.'  

 

This site should ask each and every party - including the non-sitting minors, such as NZ First and the Conservative Party - to provide specific comment on the appropriateness or otherwise of the OBR - and particularly whether retail depositors being subject to a potential loss on their deposits is fair.

And if they think it not fair - then what would they do about it.

 

 

 

On one hand we have a party wanting to sell our assets to pay for education hospitals etc and on the other hand we have a party wanting to raise working for families,training subsidi

es and rent subsidies ETC.

May i ask where have my taxes gone?

Heres an idea.

KEEP OUR ASSETS AND GET RID OF SUBSIDIES.

 

 

Interesting piece Bernard.

 

The only party advocating the policies you suggest is ACT. I had not put you in that camp.

Trouble with National campaigning on that platform is it is a guarantee of an election loss and handing the keys to the exchequer to a collection of very odd people indeed. The only thing that will cause a slashing of public spending is a bond market revolt like that facing some of the Europeans and at the moment the world seems content to give us more rope.

The problem with NZ is New Zealanders themselves. Foot stomping little hobbits. Or as an ex-pat friend of mine living in America loves to say. New Zealand is a small country; it’s full of a lot of small people. And you only have to read many of the comments above (which reflects the thinking of New Zealanders) to realise that the future for this country is one of utter mediocrity.

.... the little worms will be texting willy-nilly tonight , during the TV debate between Jolly Kid & Goofy ... darling little hobbits , as if that matters one hoot ........

Where is the vision , DB ...... which party wants to extricate Kiwis from generations of welfare " entitlements " .... and tell them to start taking some responsibility for their own lives ?

I am sure many politicians would love to do exactly that, GBH - the endless stream of voters coming in to constituency surgeries and moaning that Government (ie other people) won't give them more money to fund the lifestyles they want (but aren't prepared to work for) must be utterly soul-destroying.   But they can't do anything unless they win the election, and how can they hope to win an election on a platform of taking away goodies?

This is neither peculiar to, or universal in, NZ, David B.  There are people like that everywhere; and there are New Zealanders who aren't like that.  Aren't you one of the latter?

David B is clearly an elf.

The arrogance is a dead giveaway.

He, like a lot of others, suffers from a gross failure to understand people, most of all himself.

On the contrary, scarfie, I understand them all too well. That is what allows me to make such a statement about New Zealanders and the future of this country, and be entirely comfortable in that.

And you'd be a hobbit, kakapo, the sneering comment is yours.

the endless stream of voters coming in to constituency surgeries and moaning that Government (ie other people) won't give them more money to fund the lifestyles they want

But they can't do anything unless they win the election, and how can they hope to win an election on a platform of taking away goodies?

You're onto it, Ms de Meanour!

I'll graciously accept your agreement to my analysis only if you will also acknowledge my subsequent point - that it's neither only or all New Zealanders who are subject to preferring the easy message

Well, I'm only interested in New Zealand becuase this is where I live, this is where I can vote, and this is where, maybe, I can make a change. What happens in other countires, well, that's really their concern. I'm interested in what goes down here, and among New Zealanders, it ain't pretty.

which party wants to extricate Kiwis from generations of welfare " entitlements " .... and tell them to start taking some responsibility for their own lives  

The Kahuna Party - only it doesn't exist.

 

Seeing your obvious enthusiasm for the BK, maybe you should set it up and head it Kate!

I don't even know if I'll bother going to the vote booth. And if I do, I might well add a "Non of the above" option and tick it.

Well, Kate, as I've said before you'll have to start it. But given the society we live in today, good luck. You'll need it!

But I hasten to add, my criticism of my fellow countrymen as being the prime players in their own downfall extends far beyond just the area of welfare.

Yep.  I fear things will likely deteriorate in the next three years no matter who gets the reigns of power, and therefore the opportunity for radical, innovative, affordable and socially just change will still be there next time round.

 

 

 

Vote for whichever you believe to be the least worst option. That way you can at least say you participated in the "democracy" of it all.

The old say "You can never please anyone" is so true here.  During the housing boom period,  most people here complained about the lack of investment in our share market.  Now, potentially there is opportunities to own some of the 49% of our SOEs on the NZX and the complains are still coming thick and fast!

Thanks Bernard.

Just click on the chart above -' current account'. That's our problem right there and no Government in the past forty years has been able to set us on the path to a positive balance. We either deal with it or welcome to debt serfdom, bankruptcy and loss of sovereignty.

We've had the "think big", asset sales, floating exchange rate, independant central bank, GST, tax cuts, free trade, union and beneficiary bashing, "knowledge wave" etc. etc. In short; is there anything we haven't tried? Anyone?

What our current account deficit means is that either the Government or the people must increase their debt underwritten by foreigners - it's basic accounting - that's where the deficit shows up - on the balance sheet of our households, businesses and central and local Governments.

I don't believe any party has presented a credible plan to correct our current account imbalance, in fact they won't even discuss it. Do they not have a clue?

 

Yes, I agree with you about the problem. The solution is to run an export surplus. In order to run an export surplus you need a government and a populace who spend less than their income. Doesn't sound so hard...

Ah but Roger... "spend less than their income..."

It's not their income, it's their entitlement.

is there anything we haven't tried? Anyone? 

The Big Kahuna.

To me it's simple - to pay off debt a government has to increase its income and lower its expenditure. 

The fact that such a proposal has been called "the Big Kahuna" is one of the great ironies of our head-in-the-sand (populist) politics.  And who suffers?  As Bernard so rightly points out - future taxpayers.

 

 

Once a country has an economic policy for the people - all the people - and not one just for businesses and the rich then you do get a contented, responsible and safe society. It was done before - post war - throughout the western world and it can be done again. You don't need subsidies or handouts or policies that encourage tax avoidance. All that is needed is a structure that encourages industry to develop but does not rely on the trickle down theory for it to take effect. Wilkinson and Pickett's book The Spirit Level tells it all. New Zealand has terrible child poverty and income inequality both of which has occurred over the last thirty years. Governments must govern. Neither major party provides an economic policy that does that but for New Zealand's sake National must go. I would rather see a coalition of the rest because collectively they do talk sense.

Opinion, "they do talk sense" no they dont....

No one acknoledges Peak oil.....when you do that you also see that this society is built on quicksand that has now run out. You cant have growth without using mor eoil every year.....and in fact as il output drops there will be contraction....not growth....Child poverty, well if teh parents hadnt had children they couldnt support then there wouldnt be child poverty.....we wouldnt face the issue we will have to shortly confront that we cant feed 7billion, inded not even 2 billion let alone any more.....

So you have not seen anything yet.....

Like I said no they dont.

regards

 

Put in twice by mistake

I agree with your analysis Bernard. You write "New Zealand's system of governance has become a short-sighted vote buying exercise where electoral success is won at the expense of future generations." How do you suggest we fix this problem? It seems to me the public are always going to be susceptible to being bought, at least until the long-term debt situation really comes home to roost, and the media and the parties have to take the lion's share of the blame. The mainstream media have suffered concentrated ownership and enormous loss of journalists over the past half decade or so and the new media have unfortunately not been able to fill the gap.

I am pretty disappointed by Labour's failing to attack National's record & plans, & failing to offer the needed alternative, but still the media are not doing their job. For example, exactly how is National going to balance the budget by 2014/15 without raising taxes or substantially cutting spending? What is this based on? I can't find out. The entire civil service surely costs only about $3b (say 43000 staff *  $70K each) so even if you fired 20% of them that would only save $600m. A drop in the bucket. 

Of the two alternatives, selling assets to pay for current spending seems more short-sighted and dangerous than Labour's spending pledges which are not that big and appear to be properly budgeted. I haven't seen how National is planning to recoup the lost revenues from the assets that are sold. Nor do they answer the charge about foreign ownership of these assets - John Key keeps talking about selling shares to New Zealanders. Journalists should be presenting us with actual evidence of what happened to former state assets that were sold and their performance. Who owns Contact Energy? Wikipedia says 51% owned by the Australian Origin Energy, but the company register does not list all shareholders. 5 out of the 7 directors have addresses in Australia.

 

"I am pretty disappointed by Labour's failing to attack National's record & plans, & failing to offer the needed alternative" 

When you both hold the centre ground, are both wedded to growth as a strategy which is dead then were can they go?

Assets sales are a crock...and the PPPs proposed as a way to leverage the money from the sales an even bigger crock.....but if NZers are to shallow  to research these issues, they will learn the hard way.

regards

You're almost there, Bernard, when you say it's a 'failure of the voters'; but at the same time you couldn't be further wrong.

It's a problem of democracy, and the tyranny of the majority. So many people now have been fostered onto the State tit, that of course the majority vote to tax the 'rich pricks', etc, that is, close down free markets and freedom, in order to have the State redistribute the plunder to themselves.

It's democracy that is the problem. We need to separate the State from the economy, and for all the same reasons that the West strode forward when State and Church were separated. We need to move to a constitutional libertarian minarchy, get rid of politicians, the lolly scramble of party politics and elections, period.

In fact this form of Libertarianism Tribless is advocating is just plan anti-democratic. He just said it, 'tyranny of the majority' and it's a widely held view amongst this school of Libertarianism.

The meaning is of course, a democratic mandate is illigitemate if it is not approved of by the ruling few. The Cato institute have said the same thing and also acknowledged that the american representative democratic system is not very representative, of course they want to create the same form of democracy in NZ for the same reasons.

However in his ignorance Tribeless doesn't realise that freedom encompases many ideas, including social value ones. This is the reason people like Bill Still are trying to win the Libertarian party nomination for president.

Minarchy? Sure you don't mean timocracy?

Meaning? I haven't a clue what your talking about.

Minarchy: minimalist Government - the state's sole responsibility is to ensure that transactions between private individuals are free.

Timocracy: a state where only property owners may participate in Government.

I suppose the proposition might be that in the absence of State intervention, where a transaction is between a property owner and a non-property owner, given the inequality of bargaining power, the transaction will invariably be to the benefit of the property owner.

 

 

 

 

yes......might is right in effect.....

regards

No, all a minarchy means is that on every transaction, including buying groceries from the corner dairy, the State does not intrude holding a gun to everybody's head for a cut, and trying to force the morality of the tyranny of the majority into every voluntary act. It's just two consenting adults coming together and transacting voluntarily. A property owner can have no more sway than anyone else. (The sole role of State, indeed, is to police non-initiation of force and fraud principle, so one group can't force themselves on another, or one individual on another.)

Though it's even more basic than that. TrolleyBoy, or whatever, is falsely assuming that laissez faire capitalist transactions, capitalism, must comprise a winner and a loser in every transaction. That's nonsense. Capitalism, that's not distorted by the brute force of State, is not a zero sum game: both consenting parties to a capitalist transaction gain value, both benefit. When I buy a beer from the publican, the value he gains is profit to keep him in business (so he can serve me another beer tomorrow), I gain the enjoyment from the beer (and the knowledge the publican will still be there tomorrow to buy another beer from).

Part of the reason that freedom has been destroyed in the West is because people do not understand laissez faire (and the fact that it is not necessarily pro-business, etc, it just means no distorting/bullying State distortions over the voluntary transactions of free individuals going about their business pursuing their happiness.

If however the publican owns all the beer, the beer making equipment and has an agreement with the farmer to buy all the hops at an inflated price, and the manufacturer to not sell equipment elsewhere then customer can be charged a monopolistic cost....

There is no level playing field its not the state distorting in this case but others. 

regards

How can the publican get himself into the monopolistic position you imply UNLESS the crony government regulates the market to give him a monopoly? Otherwise, when he starts charging so much for his beer I can procure and supply beer cheaper, I'll set up my own pub, unweighed down by the cost and barrier of regulation, and compete against him. Economics 101.

Let me reinforce what I'm saying by replying to Steven that a libertarian minarchy is precisely the system where 'might is right' doesn't rule. Again, the minarchy is based on the non-initiation of force and fraud principle (one of the few principles that unites what is the otherwise very disparate individuals that make up 'libertarians'). The systems where might is right rules are planned economies, based on planned societies, where the might of the State crushes the freedom of all individuals - such as the crony statist/capitalist systems we have now.

 

There is such a thing as cost of entry.....in effect a cartel is formed.

All you really do is take away the formation of a state and allow the formation of a group of individuals into an entity that has the same effect. 

You are assuming that minarchy is actually a workable, usuable and even stable system over a long period. That is un-corruptable etc etc that is a big assumption....let alone better than cleaning up the system we have now.....which i see no evidence it is.

regards

 

 

 

Of course there is cost of entry, but it is ludicrous to say one publican can tie up the beer manufacture of an entire market: that is not going to happen without game playing regulation.

Your cartel argument doesn't hold up under laissez faire: price will always get to a point where it is profitable for another group or individual to set up and compete. So long as government is not distorting market signals. Indeed, the strongest force leading to cartels - including fuel - is government licencing regulation that effectively keeps new players out of the market (that's the real entry cost to crony capitalist markets).

 

I was giving an example to match your simple one....if you cant see through that...well....that isnt a surprise.

regards

Answer to what I've said about your cartel example then.

The reason why Tribeless' beer example does not address the concern about inequity of bargaining power under a minarchical system is not because of the possibility of monopolistic cartels.  As he says, that is a situation which can only be sustained through state intervention.  Cartels don't work unless somebody has the authority to enforce them and compel individual participants to act against their own interests.  

The reason why his example does not address the concern about transactions between property owners and non property owners, is that it is an example of a transaction between two property owners - one has beer and wants money, the other has money and wants beer, both gain from a transaction and therefore the transaction will take place, to the satisfaction of both and the harm of none, without any need for the state to intervene.

 

How do you ensure that markets are made up of individual actors, and not combines and corporations - self interest would suggest to individuals that combining to fix prices or control supply would give them an advantage.

Nope; each participant in such an arrangement would be able to make more profit by breaking the agreement (producing a greater quantity, or selling at a lower price, than that agreed) than it could make by abiding by it ..  .  . 

And when the strongest participant has his bully boys come to visit you, and makes you that offer......with a warning of what will happen if he can find one of the minimal police force and report it?

You see...I don't see human nature changing just because a few idealists believe the unproven theories of economists.

If I was in the position of wanting to get myself into a monopolistic and/or cartel position in that kind of system, I'd do it the way organised crime do it now.  Under-the-table deals, threats of violence, violence.  All I'd have to do is evade law enforcement and subvert the justice system, neither of which is impossible. 

Yes, and the only proper role of the state in a libertarian minarchy is the policing of the non-initation of force and fraud principle: the rule of law.

So? How is what you say any different to now? Indeed, now, such organised crime can make gains via state corruption.

 

OK, non-initiation of force and fraud, law enforcement only role of the state, there's the usual line.  How about some detail?

What is the Police Force of the Minarchy of Aotearoa going to do about it? Kakapo the Napolean of Crime cares nothing for the law. 

Specifically, what powers will they have?  Can they tap my phone?  Seize my bank records?  Search my office?  Bug my house?  Put a tracker on my car? Train a video camera on my driveway?  Follow me around snapping pictures?  Clone my hard drive?   Infiltrate my goon squad with an undercover officer?  And what threshhold of evidence or reasonable grounds for suspicion do they need to have before initiating such action?

Also, what internal checks and balances will they have to ensure that a) those powers aren't abused; and b) they haven't been corrupted?  Because i have no qualms whatsoever about greasing the palms of the cops to make that file about the arson at Steven's Discount Booze Hut disappear.

Anyone wanting to form a cartel and eliminate competition by force or intimidation is going to be completely untouchable unless the police have extremely intrusive powers over citizens, which seems antithetical to your ideology.  And even then it'll be largely ineffectual - all offenders need to do is skate around the boundaries of the law, insulate, and cover their tracks. 

 

 

I see this post has come back up again?

Kakapo, I've got a lot of work to get through this afternoon, then I'm away for two weeks from early tomorrow morning, and I'm basically going bush in the wineries of Marlborough, so I don't have time to answer to this, other than to guide you to  a Constitution for New Freeland. Made by minds better than mine, and sets up the process and rights under a minarchy that I support. Read all parts including the preamable.

Note, some of my comments are not on all fours with this document, though more and more I'm coming around to it. The most important aspect underlying Bill of Rights, contained, and Bill of Due Process, are the final provisions relating to the separation of powers.

 

 

And how do we get to this happy state of affairs?

Unlike you, I believe that the world is an imperfect place, and that any system devised by man will have flaws. This includes the cloud cuckoo land proposed by libertarians. I prefer a system that has some protections for the weak against the strong.

What about when you have welfare states that (pro)create the weak, and consigns hundreds of thousands of children to poverty?

23% of all babies born in NZ in 2010 were reliant, by the first year of age, on a hard benefit (DPB, Sickness, etc, not WFF) coming into their often dysfunctional familes.

What are we protecting again? (Certainly not the freedoms of those people being responsible for themselves and their loved ones who are forced to pay for all this irresponsibility). And certainly not the children being born into these familes.

It's easy to be poor in NZ: get a low waged job, or no job, and have a big family. Everyone has choices. It's called family planning: everyone can do it.

Incidentally, you say:

any system devised by man will have flaws.

I agree. Particularly when you have men in government with so much power over every indivdiual: that's precisely why we can't have such a concentration of power held by the tyranny of the majority. The Libertarian minarchy takes all the power away from such flawed cronies, and gives it to every individual. The best mechanism for satisfying the needs and desires of the complex interrelationships of all the individuals in a society is always laissez faire, indeed, laissez faire is simply the voluntary sorting out of those needs and desires. To think a single government can plan for all that complex set of relationships is a nonsense.

You guys all having fun 'liking' each other's posts then. Snort.  Tryranny of the bullying majority in action.

I think you need to read a little of the economic history of Britain in the 19th century, to see what "voluntary sorting out of needs and desires" was like for the vast majority of citizens. Laissez faire was rejected then, mainly because of fear by the powerful of revolution, if some of the economic goodies weren't shared around.

I don't see how your naive solutions would produce any different outcome now.

God, you're so scared of freedom.

The industrial revolution brought hundreds of millions of people out of poverty, and led to huge increases in the standard of living. Capitalism has always led, the more it 'is allowed', to human happiness, planned socieites have always led to misery (often atrocity). Whose being naive?

Three quotations for you from Ludwig von Mises:

All the talk about the so-called unspeakable horror of early capitalism can be refuted by a single statistic: precisely in these years in which British capitalism developed, precisely in the age called the Industrial Revolution in England, in the years from 1760 to 1830, precisely in those years the population of England doubled.

And:

The outstanding fact about the Industrial Revolution is that it opened an age of mass production for the needs of the masses. .

And:

The market economy itself was not a product of violent action of revolutions but of a series of gradual peaceful changes. The implications of the term industrial revolution are utterly misleading.

 

And have you read how those millions lived? And what their working conditions were like?

That's what you want for us, is it? Rancid slums; poor pay; terrible, unsafe work conditions.

How is that refuted by a rise in population?

 

ad hominem, basically. But:

You could only double a population where your had the prosperous conditions under which an economy could support a doubling. And where hygiene conditions, access to medicine, etc, was bringing down the death rate.

After that, don't go trying to compare our lives with theirs: you cannot ignore over 100 years of advances. Send any of us back to 1830 and we would think it was hell on earth,  but then, take your kid's cell phone from them and they'll think it hell on earth.

 

What so scares you about the fantastic prospect of living free? Why do you aspire to be nothing more than a slave? Why do you force me to be so? You are the barbarians, following a long line of barbarians.

And with that, kids, we've got friends coming for tea. I'm off to help in the kitchen.

I don't aspire to be a slave, thank you......which is why I think libertarian ideas are just so much naive and disingenuous rubbish. The freedom you espouse is freedom to be exploited.

ad hominem

Really? Your ideas are you?

So you think you're not a slave now, Trolleyboy? The best slaves are those who don't see their chains. Are you not forced to accept having a job, because you have to pay rent to a landlord and to purchase the necessities of life? Or if you own your own home, did you not have to take a mortgage out from a bank, which is merely the capitalization of 25+ years of rent? If so how can you conclude you are not a slave? Your master is merely the amorphous mass known as society.

Wordsplitting. Slavery is a state of mind - in the absence of the ownership and physical restraints.

By your definition, we are all slaves.

What type of slavery keeps you fed and housed?

Yes of course it is a state of mind. Its the fear of punishment of their master or overseer that kept slaves in their state of slavery. Just like the threat of imprisonment allow a small minority of people the ability to continue to own the vast majority of land in the Western world and therefore exclude others from it.

No Trolleyboy. Not all are slaves. There is a thin layer at the top of society that own the vast majority of resources in the world and are therefore able to capture most of the value produced by the rest of us. Why do you think inequality is so egragious?

The kind where the continued labour of the slaves is of value to the master's lol.

 

Slaves were typically well fed and housed in the old South of the USA. In fact this was the Souths main argument to favour slavery over what was called 'wage slavery'. The argument was, we own our labour force so we maintain them better than your labour force, which you rent.

As you can see from the language 'wage slavery' was not considered much better by the North and was thought to be also something to be reformed.

 

Well Tribeless,

Ludwing von Mises probably couldn't have conceived of the population of Africa or India doubling under the very conditions Trolleyboy described, but you don't have such an excuse. Since you, yourself have actually lived through a period where its happened.

"Neither party is also addressing the disaster of a lack of new house building, which is feeding into housing cost inflation, particularly in Auckland."

Finally BH saying housing costs an issue of supply.  I see some parties propose reducing house prices by increasing taxes on them and reducing cost of fruit and veges by decreasing taxes on them. 

This is dumb - by their own logic they should be increasing GST on fruit and veges as that will reduce the demand, causing prices to drop whereas removing GST will encourage purchasing, increasing prices.

Some few areas are appreciating......that doesnt mean that lack is the root cause...

regards

The problem is that generally in NZ we are very 'wet'.  We love compromises and hate to make a decision.  Our businesses are run that way, our lives are run that way - and our political system is run that way.  3 years is ridiculous for a government to try and get their policies working - hence all this fence sitting.  Then we have MMP - don't start me on that - another compromise.  Then we get a major political party, who because they are so far behind is touting agenda that would be economical suicide if ever they tried to implement it or were tied to it by promises made at this election. 

We try to please everyone (which is normally just a voiciferous minority) at the expense of the good of the country.

I used to think I was National, then leaned toward ACT, then Labour - I am making myself dizzy.  We really need a party in power for at least 4 years, voted in on a stronger political electoral system - whoever it is.

have you looked at their website? I did and uh....well....somewhat conservative....religious etc.....good old Gordon Copeland making a come back...lol.....so sort of a new Peter Dunne and the religious right.......uh no I dont think so.....

btw, why would 4 years reduce bribary? or increase thinking? cant see it.....

regards

oh right the variation of I have common sense on my side...or everyone knows its true answer....sorry fail.

Im more than happy to consider a change in three years where some logic or real data suggests that is a clear advantage.....a wooly "may" is of no value in considering a change...3 years is the check on parliment we have because there is no blancing senate or upper house....Now if we said 4 years but a 1/2 election every 2 aka US style....now that I could seriously consider.

regards

 

 

We had a referendum on a 4 year term some years ago. It was rejected.

It was in 1967.

MMP is robust and fair....the problem is that as per usual I see ppl wanting a "stronger" system they assume it will be stronger in the way they mean/want.  If of course it isnt, then its "grossly unfair" all of a sudden.  Our present system really votes in a party or multi-party union and hands them absolute power for 3 years....I dont think going to 4 is a good idea without a counter-balance.

regards

 

I have never been a fan of any form of PR - a total waste of time and just put there to appease noisy minorities who end up with a disproportionate say in the running of the country.  Could any fan of PR point out a country where it has been a success?  I have a good political knowledge and I have never come across one.

The trouble is, the people who support PR just say it 's PR or the tyrannical state you get with FPP - of course FPP doesn't mean that every vote couts, but then are you saying that if everybody doesn't vote PR is unfair?  How answerable are list MPs - not at all.

How many seats do the greens hold in Australia, but hold the balance of power and are having the main say in policy? 

You can please some of the people all of the time and all of the people some of the time, but not all of the people all of the time.

There is no absolute power in NZ and never will be.  Even if National win by a landslide, 3 years won't be enough to bring in major policies and they will end up doing dodgy deals with parties who hold totally different agenda.

There are a lot of PR govns around the world, have they been a disaster? no.

PR success, NZ for one.

Greens in NZ they get a say, they do not control...

Any party with the balance of power even in a FPP holds considerable sway it is not limited to a PR system.....the UK for instance from the 2010 election has  two parties holding power......

Absolute power, in effect the PM in a british style system which means NZ wields far more power than say the US system. I would rather there are deals done and a moderation of an agenda than not, Muldoon is a classic example of not what we want to go back to IMHO.

regards

 

First time for 40 years FPP in the UK has caused a balance of power - 2 quite similar parties and look what a mess the UK is in.

 

I rest my case m'lord.

you rest in quick sand then.....try not to wriggle too much.

regards

Tribless,

Its not just the average voter who wish to close down markets and redistribute taxation for their own benefit.

The Rail Freight Action Group - which comprises some of New Zealand's largest exporting companies - has been lobbying politicians to gain support for a Government buyback of the national rail network.

The group - Carter Holt Harvey, Fletcher Challenge Forests, BHP New Zealand and state-owned Solid Energy - wants rail freight to be a robust and cost-efficient part of the future transport mix.

http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=2697110

"Unless there is greater certainty that there will still be a moderately strong market for construction work five years out, there is likely to be little appetite by construction businesses to recruit and train people in specialist trades, or to invest in management and capital goods that will give the sector the productivity boost it needs," said the report, written by PwC.

Among the recommendations made in the report are requests for the government to improve its capital forecasting, look more seriously into public-private infrastructure partnerships and regulate against speculation and volatililty in the residential property market.

"Specifically the government could ensure that the tax burden falls in such a way that it encourages investment in the most productive asset types.

"This would provide the certainty required to reduce job creation and destruction, plan for growth, and provide the training and skills maintenance required to lift productivity in the sector.''

The report said another option would be for government to incentivise investment in "more productive asset classes such as transformational infrastructure".

http://www.stuff.co.nz/business/industries/5787564/Construction-boom-cou...

Yeah, I know Anarkist. It's called crony capitalism: nothing to do with laissez faire. You've simply listed the problem that I'm speaking of with our social(alist) democracie, the answer for which is to separate the State from the economy, have truly free markets where firms such as this can't exist and profit by game-playing legislation.

Tribeless,

Yes, I know it is, but theres been crony capitalism ever since theres been capitalism. Its the nature of humanity to exploit opportunities to advance themselves at the expence of their competitors however they can. You can't seperate the State from the economy. As long as there have been State's, they've been intervened in it, dating back to ancient times in Sumerica. For much of human history, the State WAS the economy. How do you think all those marvellous monuments of Egypt, Ancient Greece, and Rome etc were built? By private contractors?

The State is there (minarchy) for the rule of law (policing non-initiation of force and fraud). Including a framework for criminal and civil legal system (latter so contract can be enforced).

Now state the agenda of an anarchist arguing for the state, period?

Oh, and those marvellous monuments of Greece, Rome, et al. So what? If Hitler won he was going to build no doubt marvellous monuments all through Berlin: are we supposed to aspire to that?

Thats the libertarian position for the role of the State. Not a generally accepted view, otherwise libertarianism wouldn't be languishing in the wilderness, obviously.

I'm not arguing for the State, just stating the facts. Theres plenty of historical evidence and academic research backing my proposition up. How about that of Mssrs. von Mises and von Hayek? Nada.

http://michael-hudson.com/2010/07/entrepreneurs-from-the-near-eastern-ta...

The problem IMO and on top of the vote buying, lust for power is that our political parties continue to follow left or right wing ideaologies, fiscal/monetary policies continuously based on flawed economic theory and neither one knows when to intervene or not intervene in the market as the case may be.

Left leaning socialists have created the welfare state and right wing whatevers have given the corporates and financial institutions too much power.  All of them have removed personal responsibility and common sense from the mix hence taxpayers are further reliant on the state and more dumbed down than they were 30 years ago.

You have just explained why I won't be voting yet again Bernard. Pointless simply due to the poly's  and the people's own reluctance to take an honest look at themselves. I will never be suckered again into anyone's rubbish logic of " if you don't vote you have no say". Seems to me those that do vote (for the main parties in particular) only look like "mugs every 3 years because the VERY DAY after the election their "accountability" to the voter ends.

Yes, keep banging those heads against the wall and watch yourself bleed. 

The Greens?  They are the biggest reason to do away with MMP.  I can't understand how anybody could vote for a minority extreme party.  The Greens would be a dope smoking student party if it wasn't for MMP and they should go back to that.  I think people who vote green do so to appease their conscience and that's about it.

When ACT came out in support of First past the Post, I was confused, until I realized that the 1% control Labour and National and ACT.  It is "voter's choice" as in "shall we eat at McDonalds or Burger King?- You decide!- You are empowered!!!" Don't like either one? Ok, then we can all go to Pizza Hut!" It is the fake, 3 bad choices used by marketers. "Do you want to pay for that  with cash, EFTPOS or credit?- rather than "Have you decided to buy this?".

I trust Winston Peters. I have trusted him ever since he took on the 1% over the "Wine Box Fraud". They have never forgiven him or forgotten. They have hounded him him relentlessy with their media stooges. There is nothing more threatening to the 1% than an honest man.

 

There is lots of stuff that Winston Peters says that I don't agree with, but I believe he has OUR best interests at heart.

 

I think that labour and National and the Greens protest too much about Mr Peters.

 

 

Just a thought.

Why dont we have a 11 tiered wages system? The Prime Minister get 11X the minimum wage (he or she is the only one on the top wage). All the very top beaurocrats, technocrats get 10X the minimum wage. The next layer of important people get 9X, say top surgeons and top judges etc-  and so on down the line. Nurses, teachers and police could be 5X or 6X depending on seniority? Everybody could wear a little lapel badge like at McDonalds so everyone would know where they stood in the pecking order (This is VERY imporatnt to know ).

This way it is easy to work out the minimum wage of a school leaver- it is just 1/10 of the top wage. If the head of TV NZ gets  $1,000,000 PA, then a school leaver gets $100,000 PA. If we drop the wage of the head of TVNZ (and all other very top tier people) to $100,000PA, then the school leaver gets $10,000 PA.

This is fair. Nobody is worth more than 10X what any other adult in NZ is worth. This is common sense.

When I first came to NZ in 1970, this country was run by enthusiasts. People did their jobs for the love of their work and to serve their community. A real enthusiast never does it purely for the high wages, or is put off by low wages.

One of the worst scams ever foisted on us is this idea that if we pay more for somebody, they are going to be necessarily more honest and more competent.. If you pay peanuts, you get friendly social monkeys. If you pay in Filet steak and crayfish, you attract the ferrets.

(The weasels have taken over Toad Hall!!)

People who are motivated by money and not by love are politely called "gold diggers".

 

 

The basic problem is our monetary system, and the continuing tranfer of wealth to the financial sector via the interest on debt. Our floating currency hasnt take care of the balance of payments deficits, instead we have continued to bring money into the country to finance our living standards, and every dollar that arrives has come with an interest burden. We no longer control our interest rates or our exchange rate ( the OCR has lost all leverage), we are at the mercy of foreign money markets and the ratings agencies. Continued asset sales will only further exacerbate the problem, whilst   selling our sovereignty further down the river.  We now have one of the highest wealth discrepancies on the planet, which correlates very highly with a large dose of misery. The system is broken and no one with any ability to change it seems to even recognise the problem, let alone do anything about it . Nero and fiddles comes to mind..

As long as we keep exporting money in the form of interest etc to foreign banks, profits of businesses from farming to landlording and all points in between, cheap imports, DRUGS, could go on for ever, we are stuck with borrowing to keep going. And yet, we haven't the intestinal fortitude to do one damned thing about it, in fact this Natl govt is hell bent on continuing on down this path. We need to circle what wagons or we are going to be scalped, we have at least a #2 already.

I do not have the financial knowledge, only what I know of human nature and history, and I am not sure if they are not the better indicators than all the money "learnin" in the world.

One thing, I just by nature do not like is people making money out of money, beyond what is reasonable charge for lending it. Money is a means of exchange created to solve the problem of having to hump half a cow round all the time to trade. Thing is that cows could breed thereby increasing your wealth. In order for one person to make money out money, another has to lose some, and we have let it go on for so long now, lauding those building wealth on others losses. Now we see what is so plainly evident, the rich have gotten rudely richer and poor have got poorer, to the point now I think, that if we were back in bible times, Jesus  might be right now readying himself to turf the money changers out. And so now should we

A dopey political system and democratic reality prevail.

The article fails to acknowledge that both major parties are making commitments for balanced budgets whether it’s achieved or not is questionable but at least they have committed.

As for plan B would you seriously go out on the campaign trail saying if  x or y happens then trying the explain two or three hypothetical solutions or out comes.

It politics get real most of the punts fail to grasp the current basics.  

Both parties are only interested in the short term, maybe a 4 year term over 3 could help in a very small way.

But only if it is a fixed  4 years with election date fixed in law.

Looking at the new Header of Big B. on Buisness News.....I'm thinking beauty and the beast without really knowing why...hmmm....she's so kaaaaaaute! n purdy don't cha think Bernard.

Ahem..anyhow....why is this thread back at the top of the posts  Bernard ..?and not Alex's politico blogroll of say Tuesday....

I thought the posters stuck more with the content of the article in that thread....

 Just curious is all.

NZ had around 30billion of Govt debt in 2008. Over the last 3 years that has more than doubled. Coincidentally (or not) the tax take has been down by about 3billion per year and we have had virtually zero economic growth with the loosest monetary policy in our history. Now we are told it is a good idea to sell virtually half of all future dividend streams from strategically important assets for the benefit of a mere 5-7billion upfront. And yet somehow Key and co are able to pass themselves off as the "responsible" choice for steering the economy.  

Your solution would be...........

There is no silver bullet, because as Bernard reminds us EVERY day, the world (and in NZ, it is the household sector) is weighed down by massive debt. That is to say, future growth through consumption will be muted at best, because we already had all the consumption and now we have to pay for it.

In this environment, as we have seen, lowering interest rates is pushing on a string - so is cutting taxes. It's not going to create jobs, or trickle down, because there is insufficient demand in the economy.

Instead of mainting taxes where they were and introducing an earthquake levy to pay for ChCh, Key and co has cut taxes and had to borrow more than would otherwise have been necessary (although an increase in borrowing would have happened anyway). I know the increase in GST was intended to make it "fiscally neutral", but that assumed an increase in spending which was never going to happen.

The foregone tax revenue already exceeds what they hope to raise from foregoing ALL future 50% of dividend streams from the SOEs. That's to say nothing of the implication it may have in terms of strategic planning in electricity infrastructure. Meanwhile they are not prepared to address structural issues like CGT and the retirement age - at least Goff and co have made tentative steps in that direction. Both parties maintain the fiction of a return to surplus in three years - although I suppose it would be pretty ballsy to tell Treasury they're dreaming.

It's probably a good election to lose, because in three years time when the growth invariably hasn't materialised, whoever wins on Saturday is going to look a bit silly.

So it's a CGT and increasing the age of entilement for super??

Again, there is no silver bullet. But those would help to address the structural imbalances in the economy, so I support them yes.

JK seems in denial that there even are any structural imbalances and seems to think that if the taxes and the interest rates get low enough then "hey presto ... economic growth". In the past 30 years that might have been true, but this is a "new normal".

It's debateable whether any of our politicians understand that, but it seems obvious that Key and co most certainly do not.

Having said all that - I'm actually pretty optimistic about NZ's long term future, but I think things will get worse before they get better.

Reserve Bank Monetary Reform. Stop importing our money supply as credit will be a game changer ! And instead of raising taxes to pay our interest bill, let's manage our natural resources ourselves and create an amazing country from selling of some of what is in the ground, before we go broke again and the IMF bamksters take it from us anyway!

Good comment on it being a good election to lose. I always felt the nats would be a 2 term govt. The longer the promised booming recovery does not materialise, the more key's popularity will wane

Until even his PR team won't be able to spin him out of the lies he is telling. He most gullible of people may even then see through the hollow men.

What are the actual options economically at the moment?

a) Inflationary depression

b) Muddle through

c) Deflationary Depression

I am now completely and utterly cynical about "fiscal responsibility". It is a complete and utter waste of time. The courageous, honest and upright politicians who do balance the books and pay off debt are repaid with the most scandalous kind of reviling from the public for the rest of their lives. We simply should have defaulted. Then the "pain" the public will complain about for ever after, cannot be blamed on honest and upright politicians, it is the fault of the venal and dishonest ones who spent the country into a hole.

The voters deserve the pain in every way. And the investing fools who think sovereign debt is a good risk, need to learn the hard way that sovereign debt is now the world's biggest unburst bubble. Only in cloud cuckoo land can anyone seriously believe that there is ever going to be another "Rogernomics" in any country, and that any country is going to "pay it off". It ain't going to happen in Greece or Spain or Italy or Britain or the USA or NZ.

My advice to Bill English now is to spend NZ right up to the limit, and spend as much as possible on roads and useful investments. If Ruth Richardson had done this and Mikhail Kullen had not HAD a full kitty to BLOW for 9 years on the most wasteful kind of vote buying schemes, NZ would be AHEAD now. My advice to Bill English, is to leave the idiot socialist who will inevitably succeed him (Mallard?) with an inevitable sovereign default.

I would far rather see an idiot socialist government vainly trying to keep any promises it has made to gain office, after having already run out of other people's money; than see a re-run of Kullenism whereby the "other people's money" (quote; Margaret Thatcher) that has carefully been husbanded by responsible government, is "BLOWN" anyway. Far better for it to be sunk in concrete, steel and tarmac.

One of the most sickening things about the "family silver" stupidity, is that apparently it is OK to "invest" taxpayers money in "assets" that cost  a bottomless pit of taxpayers money to run, but ROADS and airports and ports are not a worthwhile investment? I strongly suspect that the constituencies for "preserving the assets of the people of NZ" are largely people who are themselves a net drain on public resources.

Radical stuff Phil, I like it.

Whilst I do detect a cynical note, I think the argument is well worth developing. Some of the best ideas start off life a bit half baked.

One observation that I think fits in well with this line of thought is that I think each party has greater leeway with its own core supporters for sensible reforms without provoking a backlash. Thus, National can reform the tax code to close tax loopholes (Labour love sticking plaster solutions to individual problems, which creates loopholes, eg no GST on food) even though it's business owners who have more ability to reorganise to make use of the loopholes.

What about creating loopholes that union pension funds can benefit from? Tax free West Coast Port Bonds to create a deep water port at Greymouth perhaps, so we can get mining at scale instead of playing at it?

 

Heard some sense for a change from an economist on abc radio today about how dangerously complacent aus is given the euro crisis. Same would apply to nz

And the economists view was that aus hadn't learnt anything from Europe, there is still far too much wasteful spending