Opinion: Bernard Hickey argues an earthquake levy is fairer and safer than taking on more foreign debt

Opinion: Bernard Hickey argues an earthquake levy is fairer and safer than taking on more foreign debt

By Bernard Hickey

The government will have to make some tough decisions in the next six weeks.

Now that the potential cost of rebuilding Christchurch is becoming clearer, the government faces the choice between increasing its debt or imposing an earthquake levy on income earners.

Unfortunately, insurance and reinsurance payouts will not be enough to rebuild Christchurch.

The EQC will pay out NZ$1.5 billion as an 'excess' before a further NZ$2.5 billion of reinsurance kicks in. That will all go to residential property owners rebuilding homes. Then private insurers will stump up with the rest. This of course does not cover those home owners or landlords who did not have home and contents insurance. They are naked.

Then commercial insurers and reinsurers will cover some of the cost of rebuilding commercial buildings destroyed in the central business district. Prime Minister John Key has estimated they could pay around NZ$5 billion to NZ$6 billion and the EQC would pay out around NZ$9 billion for the two earthquakes, including reinsurance of NZ$5 billion.

The council will have some reinsurance for buildings and local council owned infrastructure, but it will not be enough to rebuild local roads, water and sewerage.

This is where the central government is going to have to step in. Fulton Hogan has already estimated billions of dollars of spending to rebuild roading infrastructure. Most, if not all, of that will have to be paid for by central government.

Then there will be many, many government owned schools, offices, hospitals, police stations that will have to be rebuilt.

Prime Minister John Key has estimated a total repair cost from the two earthquakes at around NZ$20 billion. See more here in Alex Tarrrant's article.

Key reckons, therefore, there is a gap of about NZ$5 billion to pay.

Finance Minister Bill English has already indicated the government expects to increase its borrowing programme this year from the (already increased) NZ$13.5 billion or NZ$300 million a week.

So the choice is clear: does the government borrow the NZ$5 billion over the next couple of years or impose a special income tax to raise the funds.

No worries. Just borrow?

On the face of it, there seems a lot of room for the government to borrow. The government's debt to GDP tracks remains very low by any international comparison and as recently as December was forecast to double to around 28% over the next four years.

New Zealand's problem is a total net foreign debt of around 90.5% by 2015. See Treasury's latest forecasts here. That is a Portugal/Irish/Greek/Spanish (PIGS) level of net foreign debt. The difference for New Zealand is that most of it is debt held by the big four Australian-owned banks.

Both the banks and the government face a ratings review for possible downgrade from Standard and Poor's. 

The Reserve Bank, the Treasury and Prime Minister John Key (as recently as last month) warned of the dangers of adding to New Zealand's net foreign debt.

They are right to worry about the future. Higher interest rates would force New Zealanders to pay anyway, with the increased costs going to foreign creditors.

We are entering a potentially dangerous period over the next decade or so where sovereign debt crises will abound. Developed nations such as the PIGS, Britain, the United States and Japan will all be borrowing monstrous amounts from bond markets. America is again set to borrow more than 10% of GDP over the next year.

Up until now, the vigilantes in the bond markets have remained relatively quiet. They are spooked by the dramas in Europe and the Middle East and have kept their money in the 'safest' assets, which are still seen as US Treasury bonds.

But as the reality of rapidly increasing government borrowing and ageing populations hits, the bond vigilantes will become restless. We are already seeing it in parts of Europe where interest rates are at such high levels that 'Minsky moment' debt spirals beckon.

The risk is that choosing to borrow more simply delays and compounds a moment of reckoning for the New Zealand economy.

At some point we have to face up to the point that our wealth has been significantly reduced, our earning power has been damaged and we need to reduce our standard of living in order to save and build up our capital stock again.

So lets get to work

The fastest, fairest and safest way for New Zealand to save as a nation and use those savings to rebuild infrastructure is to impose an earthquake levy on those who can afford it.

The Greens have proposed one that gathers NZ$921 million a year. Earners outside Christchurch earning more than NZ$48,000 a year would pay an extra 1%, while those earning more than NZ$70,000 would pay a 2% levy. See more here on the Greens' proposal.

The elephants in the room of Working For Families and Interest Free Student Loans also need to be addressed.

At some point New Zealanders need to save.

We can't kick the can down the road any more.

This earthquake should really be seen as a national day of reckoning when we finally decided to sacrifice some consumption to save and rebuild the economy.

(Updated with video)

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 Hickey: publishing "The Greens proposal one that gathers NZ$921 million a year" tacitly promotes that one proposal at the expense of any alternatives. Surely a "fair and balanced" article would have listed a number of alternatives for consideration. Otherwise you (as a journalist) should put up your reasons for remaining silent on the other methods. By implication methinks you are telling us how to think.

I dont see why, but then Im not surprised the right wingers think that....all it does is lay down an option for discusion...so the Green's lead with an idea...by all means come up with others....

"They are right to worry about the future. Higher interest rates would force New Zealanders to pay anyway, with the increased costs going to foreign creditors."

Yep....so a levy to control the debt makes some sense, certainly more than selling yet more bonds...

regards

 

NO debt or levy is required. It is now time for Insurers to sell their assets and payout!

C'mon now! Pay up you parasites!

The insurance companies will pay 75% ish or 15billion ish of the expected cost....so the insurance pays the lion's share and is meetings its obligations.

Now we have to meet our obligations around how we meet the remainder of about $5billion...

So the choice comes down to say,

1) Abandon Chch...perfectly viable in a business sense, if you ignore we'd have a civil war on our hands.....

2) a 1% levy on PAYE or land tax and our credit rating survives so we continue to "enjoy" a fairly low interest rate,

3) or we issue yet Bonds which will probably mean a credit downgrade either NAtioanlly or the banks who's debt is bloody awful and short term, at which point we pay that 1% (or more) anyway but to foreigners....

So for the last 2 we are going to pay....its a Q of who we pay it to....3) for me is a very bad choice....so that leaves 2).

regards

1 Abandon Chch, you don't think the economy and all of us would  not pay under this option economically as well? LOL

Steven, the EQC levy was supposed to be the "excess" payment on the insurance policies. That was the point of it.

 

"meet our obligations"? We don't have to do jack boo! That's why we pay insurance

Just thinking out loud here, but what about issuing some Build Christchurch Bonds to domestic investors only?

There is how much money <Bernard?> sitting in term and call deposits doing pretty much nothing right now. Surely some of that could be tempted by a higher yield, not to mention a sense of patriotism.

Maybe absent a government issue, it's an opportunity for the banks to get some good PR by launching something along those lines. 

ChCh probably represents a good investment right now.  There really can't be much downside from here and assuming the city comes back, which it will eventually, the potential upside is huge. 

 

ChCh a good investment? um....its bombed out and may never recover.....in fact given Peak oil I dont think it will....best bet is turn the cbd into allotments....and grow stuff.

The issue would be scale and interest if its not Govn backed debt. The Govn can probably borrow at 3% ish, Chch would be 6% ish I would think....thats potentially the interst payments just for ChCh that we are paying for the National debt.....and there is what in population? 300k? to cover 5 billion in debt? I cant see how...so it has to be on a National basis....so a levy.

regards

 

You're probably right that the debt has to be raised by the national Government but they could market a special bond issue as (Re)Build Christchurch Bonds. Essentially just a marketing exercise really but it may attract more domestic capital, that is currently just sitting in bank deposits ... so many people asking, 'how can I help?' - buy bonds.

But "bombed out and may never recover"? We've all seen the footage in the past week and it is god awful sad, but it's not Hiroshima circa 1945. And they rebuilt that.

 

Now we see what a rich country we really ain't don't we! Fonterra will save us! yay

Agree Bernard that NZ should not borrow the funds.

The steps should be:

a. Liquidate the NZSF and use the funds to rebuild CHC. This will give $16bn immediate funds;

Then after the initial crisis in CHC in dealt with, address the medium to longer term issues:

b. Abolish WFF, interest free student loans and Kiwisaver contributions;

c. Increase superannuation age to 70, with the option to call down early (at 65+) at a discounted value;

d. Reduce the income tax rate to a flater rate, with the first NZD 10k tax free;

e. Introduce a land tax at a low, flat, all inclusive rate.

So in summary, lets not do a  knee jerk socialist reaction and impose taxes on the ever decreasing skilled workers in NZ.

Take a careful look at the departures to Oz over the next 6 mths and then look at the composition of these. You may see a lot of those people in the $70K plus we are planning to tax. The revenue generated from a levy may therefore fall short of expecatations and go no where far enough to solve the hole.

Another Me-Me-Me contribution.

Just start by reversing the tax cuts. Even then NZ marginal tax rate would be less than Oz.

These Act dreamers always will dream and never contribute anything that could work.

Why put additional burden (tax) on income - given what we are talking about is rebuilding infrastructure in the built environment (i.e. capital)? 

If one wants to raise taxes - why not raise a tax on capital not income? 

Income as we all know can be declared/reported/structured to avoid taxes (particularly by those with accumulated capital).

All you and the Greens are suggesting is socking it to the PAYE earners - yet again.

That said though, why oh why don't we just issue new money interest-free directly in to the economy?

The levy should "catch" everyone in a fair manner...not just PAYE I would hope......but PAYE R's should not be exempt.....

regards

Indeed Kate. The elephant just got a lot bigger and the room got a lot smaller.

A 'Public Credit' solution would work in this instance, look at past examples, especially in emergency and special situations.

 

However, the whole southern hemisphere would have to get flattened before those that control money supply, now, might yield that power.

 

What's required are some politicians with balls = real leaders, to make it happen. Any out there?

 

There are some good examples of these, even in New Zealand, but in the past.

 

Who were they? 

 

In the US one was Abraham Lincoln with his 'Greenbacks'

 

Keep it simple.

 

Cheers, Les.

 

www.shakennotstirred.com

 

PS - How about folk start thinking about what productive capacity ChCh has left? It will brighten your day. The port is largely ok, the tunnel as well, rail too. Canterbury farmers have not stopped doing what they do, the same is and will be true for many other exporters here. With modern comms those that service these businesses can do so more easily than in the past. ChCh can still generate income, hence ChCh still has a good future, we just need to rebuild with Mr Greendale and Mr Lyttelton in mind (tw*ts). It'd not be a fitting tribute for those that have died and suffered to give up on ChCh. We need that staunch Cantabrian spirit to well up, get back from wherever. It's good to be alive.

What about a tax of say 1/4 cent in every dollar deposited in the bank.  It can't be tax deductible but would raise a lot of money.  

Because that hits savers ie OAPs who are already hit hard with low interest rates...

regards

A tax of 1/4 cent in every dollar deposited equals $2.50 on every $1000.00 deposited.  I think even the OAP can afford that but it catches the large amounts deposited by business as it is not tax deductible.  You might say it would increase costs but I don't think so because it would be self defeating.

WTF? So those people who choose to spend their money on 50" TVs and other useless crap don't pay anything while those who save their money get taxed?

No it has nothing to do spending.  It is only to do with depositing.  Everybody has to have their money banked these days so when it goes into their bank account - say my example of $1000.00, $2.50 gets taken out.   1/4 of a cent on every dollar deposited.  They then spend their money as trhey wish and buy that TV, if that is what they want, but when the shop banks the money for the day 1/4 cent in every dollar banked by that shop gets taken out.  It is so simple but the most important thing, for it would not work otherwise, is that it cannot be tax deductible.

I agree, anybody can spend their money the way they want.  That is what I said.  I am talking about a 1/4 cent tax on all deposits

Green , dont worry this stupid idea is sooooo far off the field we should take no notice , it will never happen .

There would be 2 unintended consequences :

1) The banking system would collapse if you taxed people who simply banked their money ,

and

2) There would be Capital flight , I and many many others  would transfer all my savings to Australia  

Boatman, a similiar tax was in existence in Australia before they had GST.

The Banking system didn't collapse when WHT was introduced.

Ditto for capital flight.

And feel free to leave

We could start a by giving ther banks a break - they get asked for too much at times. Perhaps all those with mortgages could increase their own interest rate by 0.5% and donate the extra few dollars to giving relief to Christchurch people who are struggling to pay their mortgage. Those without mortgages could just set up an AP for $20 a week toward it. To keep everyone up to it there could be a web site with names of those participating....

Regarding tax on capital, land, assets -call it what you will

try assettaxnz.blogspot.com/ 

Best article I've seen on the question of re-build;

http://www.sciencemediacentre.co.nz/2011/02/25/lessons-from-kobe-as-christchurch-looks-to-rebuild/ 

“It really took Kobe ten years to recover and the economy has never fully recovered. 

 

Add in the relative size of the Christchurch economy to NZs whole  vs Kobe to Japans and the uncertainity of the fault line settling down....results in the mother of all economic shocks.

Interesting article - thanks for posting.

One could easily say that the entire Japanese economy never fully recovered (to date) from the bursting of the asset bubble in 1990.

Of course we now have a deflating property market of our own to contend with, so there are some similarities in that respect.

 

I agree a levy of some sort has to be raised. But there are two issues :

1. The EQC is a very good setup ( apparently it is unique in the world) and this needs to be rebuilt quickly to cover future issues like it has served us well in the past

.So for this an increase in levy has to happen ( but only until a set limit is reached)

 2. Any shortfall for the Christchurch rebuild.

Whatever is decided here it has to be simple and very easy to collect ( not some bureaucratic night mare like how WWF is handled)  A PAYE levy is unfair as it hits wage/salary earners disproprtionately. Maybe a levy attached to our rates ( with landlords allowed to increase rents so renters pay their share). Or say a % increase in GST ( until a defined amount is achieved). Whatever it is it should be able to be done without employing extra people to adminster it.

I don't think you're looking outside of the box Bernard and are therefore short-sighted.

There is no reason why we simply cannot print $5b after all most of the jobs created will be in construction creating NZ jobs this could in-fact be beneficial as it could lower our $$$ value making our exports more attractive i.e. a growth lead recovery in construction, primary and manufacturing sectors.

Another idea would be to finally impose a capital gains property tax on all homes and I think most people who follow your site would think this a good idea.

The problem with bailing out Christchurch with either a levy or borrowing foreign debt is that it sets a president and what happens if heaven forbid Christchurch or Wellington or another major city has another quake  or flood damage or volcanic eruption - the taxpayers would soon be bankrupt.

the taxpayer will be soon bankrupt if either happen and you cannot replace the income lost for the country.

As a user of this site please dont speak for me, just speak for yourself, is just fine.

Im all for something fair....with everyone chipping in.....and actually paying...

regards

Such is the risk of living on a fault....

The point is sharing the cost over the country even with several earthquakes would be doable....just leaving a city to fend for itself would be a disaster....

What Im not so sure of is that the cost is 20billion with 15billion being brought in from abroad as re-insurance cover, so that 15billion is like a massive public works spree paid for externally....thats the [only] plus, the minus is all the Chch businesses who close or move....deaths.....etc etc........

regards

Please don't miss understand me Steven I'm for the whole country pitching in, I just think printing money as America seem to do so often would have real benefits in this case for the whole country. Or alternatively a capital gains tax on property, I think both of these options particularly printing the money would be better than a levy or tax.

Alif, perhaps I miss understood the article, we need $20B to recover - insurance & government have $15B leaving $5B that must be found = so the money wont run out, it is the total sum that is required.

There are many variables which make our exports attractive the overwhelming reasons are quality vrs. price and a devalued NZ$ plays a part here.

Again my understanding is that in the past the "bailing out" has been managed through Government contributions which are budgeted and insurance. This is a "once in a lifetime event". You may correct me here with an example if I am incorrect.

When you say "This is a "once in a lifetime event".", I don't imagine you refer to Tuesday's earthquake? I'm sure many Cantabrians would wish that this was a once in a lifetime event. In fact we hoped it would be so back in September but unfortunately it is already a "twice within 6 months" event (just because nobody died the first time doesn't mean there was no damage or that it cost nothing)...

I put money on it the private sector within the CBD will be well under insured with the majority not having replacement  policies, more likely  indem. in the commercial sector. The wealth destruction is immense. That is the elephant in the room no one is talking about.

Stop the carbon tax. Change it into the restoration levy and keep the money in NZ. The carbon tax is nothing more than a social political control tool.  All it does is milk the NZ people and allow China, India etc  and  the huge carbon trading monopolies (Al Gore, Maurice Strong and others) to reap billiions. Still believe in the myth of man made global warming, go to www.friendsofscience.org  and listen to what the scientist are saying that haven't been bought out.

No one can deny that there is a huge pollution problem in the world. However its a completely different issue and has nothing to do with Co2 emissions, which is a natural part of life on the planet.  Wish our Greenies would become true environmentalist.

Dirty boomer

You are talking pure cr*p............this site is laughable.....

Like papers from the "Science Director of The Heartland Institute"......At first glance all the above site does is correlate AGW deniers....it isnt science based, it does no research....it has no competent ppl....

http://www.friendsofscience.org/index.php?id=453

This graph for instance apart from its cherry picking of a trend curve which should be taken for the entire period...........um it already shows 2011.....well done on that.....so we now 2011 is um colder already....because they um, say so.....

Of course these ppl dont do research....and this "graph" certainly shows no sign of any mathematic rigour.....

I will have hours of laughter reading this site....thanks looks better than comedy central!

It also brings together denialist papers....so you can see the quality (not) of the denier science all on one site......nothing liek shooting yourself in the foot.

"Wish our Greenies would become true environmentalist." I have no idea what you mean or are trying to convey by this statement....

regards

 

Enjoy the source of amusement and while you are at it check out the glaciers receeding and ocean levels rising.  The truth always come out in the end.  You might also want to see what Piers Corbyn and the team at www.weatheraction.com  are saying. FYI their weather prediciions have been 85% accurate for years, which is commercially sold to industry. We are in a cooling mode again which will peak by around 2020. You are seeing clear evidence of this. Ice shelfs are building up again. Bottom line is we are well on the way to becoming another Iceland or Ireland, as we are sinking into a debt we can never get out of, with our fragile economy and small aging population.

The real environmental issues of today are the dangers of GM, the toxins going into our food, The spraying of Barium and Aluminum Dioxide into the atmosphere (Chemtrails) . Anyhow, have gone off topic somewhat,. Wish you well.

Eagle, Have you noted that Monsanto are desperately trying to get in here via the free trade talks with the US?

Not suprised. There is a very interesting clip on YOu tube called "Food the ultimate secret" which is worth watching. I personally think its exagerrated somewhat, but the guts of it is on track with the GMO and Aspartame levels and High fructose corn syrup (NZ still pretty free of it thanks to some).  Anyhow, here in Christchurch not much time to participate in such interesting debate. Our communities and leaders are doing a fantrastic job, but folks are getting tired and the reality of it all is sinking in. Makes one appreciate whats really important in life, thats for sure.  Last thing we need is a carbon tax  on the very air we breath. Hopefully  our govt will find a  way to stand up to globalist pressure and waiver NZ from this and possibly other things to come.

 

 

A GST levy would be fairer. It captures all people who do not pay PAYE tax. It would have to been in place for a finite period only. Say one or two years. We will also pay more for EQC levies, but that will still only be a couple of hundred dollars per year, $4 per week, so not too much for the average homeowner.

I would like to see the rebuild of the Christchurch CBD. I think there is an opportunity for better, more functional and efficient buildings that will be able to flow together. If an architect in town planning wants to make a name for themselves, then here is their opportunity.

Bernard, funding the rebuild is a debate we need to have. It would be good however to get all the facts together. How much it is going to cost. What insurance/reinssurance companies will pay for, how much the government will be asked to pay, Obviously public infrastructure will have be funded from a public source.

Personally I think there will be a multifaceted approach that will incorporate additional revenue gathering, borrowing and private-public partnerships and entirely private projects.

GST levy is regressive and hits those least able to pay...so its not fairer by any stretch of the imagination....IMHO.

regards

Come on folks. There is a softer target sitting quietly in the wings waiting to be plucked. Try logging on to the Air New Zealand web site and go through the steps of getting an indicative price for a return trip to Australia and back. And then look closely at the departure tax differentials between the two countries. NZ is about NZD $25 whereas the Australian levy is NZD $105. With 2,000,000 visitors to NZ every year you could cover the problem quick smart.

“Most of this spending will be on essential infrastructure such as roads, water and sewerage systems" - Bill English

Seems sort of based on 'last quake = 5billion, this one 3 times worse therefore..."

Seems a lot to spend when the earth is still moving - is this just the cost of temporary repairs required to get the city up and running? Or a cleverly designed  'earthquake proof system', or just a guess.

If the latter, then why are we already talking about raising money for work that has not yet even been quantified, let alone costed. Don't give out blank cheques just yet.

Steven --you are probaly right about the GST. So perhaps the easiest is to attach the levy to ACC payments and they simply deduct it on receipt and divert it to the "fund".

In all this talk of ways to pay, is the question of rebuilding on sand/fill coastal marsh land not  an elephant in the room?Would have thought the Greens would be asking the question.

 

Some very interesting comments on how the earthquake can be paid for. Like the idea of a bond issue that we can invest in and help at the same time - better than in term deposits in the bank.

Wonder where all the donation fund money will be used? A lot is covered by the goverment and private insurance.

If we take our Term Deposits at maturity and put them in a dedicated Bond Issue, what do the banks do to replace that part of their core funds (that they use to support their established lending; their mortgages) with? New Zealand doesn't have the money. Someone will have top borrow it, whether is the banks or the Government. Because all our tax free savings are tied up in our houses.

It does need to be recognised that the rebuilding will take years not months....the massive costs will be spread over years....to that extent the EQC fund will not draw down as quickly as expected and the reinsurance payments...if they are made!....will be invested until needed. 

Precisely Wolly , years not months , which mans we need long term Capital . That means issuing Bonds , even if they are compulsory Bonds paying half a percent p.a.  

A compulsory Bond can be a form of Tax , where say 2% of your income is taken and you are issued a Bond . This Bond is then a form of saving which adds to the savings pool. 

The problem with a tax to fix Chch , its a zero sum game , take it away from someone in Palmerston North and Palmerston North suffers with less disposable income.

Provincial New Zealand will suffer tremendously

What about making home and contents (and for that matter vehicle insurance) compulsary. Not every one that owns a house has it insursed and when the proverbial hits the fan they look for hand outs from the government or the generosity of the public to bail them out. If you can afford a house you should be able to afford the insurance that goes with it. Not the full answer to this problem, just one of many I think that would help resolve this problem

very few people do not have insurance as most banks force you to take it. I don't know of one home owner who is getting a government bailout because they had no insurance. They may be getting handouts like what is now being put in place but who would begrudge immediate help

Fair call Justice, One thing I would put out there is how many people who just flat and don't have contents cover? That will come out in the weeks that follow. Some who can't afford it will need us to help them out, no problem with that, there will be those that could afford it and couldn't be bothered and our dontations will be used to bail them out instead.(hopefuly these people are the minority)

Tranny, we rent and have no contents insurance on principle alone. To us it's just "stuff". Way more important things in life to worry about. I ofcourse would hate to lose our photographs etc  but even an insurer can't bring them back if destroyed

Don't have a problem with your rationale or attitude. However there will be plenty out there without cover who will be putting their hand out for state or charity handouts as "their"form of insurance.

 

What I can tell you after Sept 4th after the initial four weeks and once media coverage went people were left feeling alone. They struggled to get hand outs and any type of communication on re building etc..I know of three families that spent four months living in there garage...the RED tape of EQC and insurance companies made the process very hard and time consuming..they actually had not made any decisions on how to fix the land or when the serious rebuilding was to start after the last one..so do not expect a quick resolution to this one unless the process has chnaged and outside help (i,e not only Fletcher's) is brought in, problem this time is that there is far worse serious damage so not sure where to house all this people..especially with winter around the corner? Some fast decisions will need to be made this time. (are you listening Gerry)..it wont be 20 billion over two years..but over 8 years I suspect 

FYI here's this from the Greens

The Government has a unique chance for national and political consensus around an earthquake levy, rather than risk a politicised argument about possible spending and benefit cuts, Green Party Co-Leader Dr Russel Norman said today.

Dr Norman was responding to the Government’s recent signal that Working for Family recipients and students with loans could be called upon to help meet the cost of the Christchurch earthquakes.

 

“While there is likely to be significant debate over Government spending cuts, it seems there is anecdotal evidence of wide public support for a targeted, time-limited earthquake levy,” said Dr Norman.

 

A recent Herald online poll on the issue suggested New Zealanders were open to the idea, with 69 per cent saying they would support such a levy and 31 per cent saying they would not.

 

“Australia has raised a levy after their flood disaster and their Government is, financially speaking, in a much better position than ours,” said Dr Norman.

 

“The Green Party supports a fair and equitable approach to paying for the rebuilding of Christchurch.

 

“This means sharing the costs across those who can most afford to pay. A levy is the fairest way to pay for the earthquake and we believe serious investigation of this option should be undertaken.”

 

The Green Party asked the Parliamentary Library to model a number of different levy scenarios for income earners above $48,000. A meaningful amount can be raised in a short time to aid with the reconstruction of essential, uninsured infrastructure. The levy can be structured to include contributions from corporations and/or exclude taxpayers in the Christchurch region.

 

“A small temporary earthquake levy will have much greater popular support than a politicised argument about spending cuts,” said Dr Norman.

 

“Welfare cuts of the size needed to pay for the likely damage will need to be significant and affect some of the most vulnerable.

 

“Revenue raising has to be on the agenda.

 

“The fastest, fairest, and economically prudent way for New Zealand to rebuild the livelihoods of those in Christchurch is to introduce an earthquake levy on those who can most afford it,” Dr Norman said.

 

The Green Party has written to the Prime Minister offering their constructive support for a levy and other related matters.

http://www.greens.org.nz/misc-documents/how-earthquake-levy-could-look

Bernard,

The carbon tax is a huge source of revenue that we could use to help us out of this. People have accepted it like it or not and we have a very good reason to have some form of waiver for a few years.  I know its a tough question and political no go area, but these times are exceptional. Anyone that does not agree, i suggest they visit the Eastern suburbs  of Christchurch, after which they may change their minds.  Many Kiwis are already struggling  with the GST increase and now rising fuel costs which will hike everything again, Another tax/levy is not the answer in my opinion. 

Rgds 

Eagle - perhaps you may remember from your childhood, a little gem titled 'Not I, Said the Little Red Hen'.

The carbon tax is (meant to be) resultant in less carbon pollution. That's a physics thing. Strangely enough - and Christchurch is a recent example - mother nature and the laws of physics take no notice of $$$$$$$$ whatsoever.

So it has to be spent - or onsent/spent - doing some kind of physical mitigation. Tree-planting, sequestration, something real. The alternative is to use less fossil energy - which will for sure reduce your income.

What you're advocating is to either not mitigate, or to double-spend.

Both are intergenerational fraud.

cheers

And you may remember that other little gem.. "The Emperor's got no clothes on" 

Climate change is natural, always has been and always will be,it has nothing to do with co2 emissions.   It is driven by solar activity.  Not much co2 emissions during the medieval warm period....  Anyhow, am beating a dead horse on this one.   

Have a good weekend.

Solar activity has actually decreased slightly, yet we have warming........

"In the last 35 years of global warming, sun and climate have been going in opposite directions"

http://www.skepticalscience.com/solar-activity-sunspots-global-warming.htm

Climate changes due to many factors, these individual factors can be agressive, dormant, singular, multiple and certainly complex. Some in certain times frames will dampen an overall trend, other times actuent it. So for instance el nino and la nina can dampen or actuent a constant upward trend and we can see that effect from the 1998 on decade.

Med warm period, this was fairly local and the science/data suggests actually over all the planet it was cooler,

http://www.skepticalscience.com/medieval-warm-period.htm

The above piece also explains why.

In terms of other silly comments/claims,

http://climateprogress.org/2010/12/28/simple-rebuttals-to-denier-talking...

Links to all the infamous denier claims and the rebuttals thereof.

Dead horse, indeed....the science is about conclusive as it can be.......AGW is real and we are seeing its effects today....and its going to get worse. So what you are doing is telling us you are a flat earther because like believing in a flat earth there is no scientific basis for your position.....sure political, sure denial, sure religious, sure lack of understanding, sure crackpot foil hat brigade,  "Do we believe the whole elite of science is in a conspiracy?  At some point in the development of a scientific truth, contrarians risk becoming flat earthers."

http://climateprogress.org/2011/02/20/jeremy-grantham-global-warming-wea...

The only scientific answer left really is how bad, and its looking pretty dire for our grandchildren....the other is a moral one, are we man enough to do something about the problem we are leaving our children and grandchildren or are we as morally corrupt as we seem.

regards

Steven,

Wake up turn off CNN and BBC. Look at what the IPCC did to the data.  Look at the UK in December and the northern US, The tempeatures were extreme cold. What does it take to make folks realise that Al Gore and  the New World Order cooked the data. Climate change is natural and always will be. Think of this as the we too start to see the cooling between now and 2020.  Some interesting quo 

The following quotes, listed on the website of the US Senate Committee on Environment and Public Works, provide a taster of what will be contained in the upcoming Senate report:

“I am a skeptic…Global warming has become a new religion.” - Nobel Prize Winner for Physics, Ivar Giaever.

“Since I am no longer affiliated with any organization nor receiving any funding, I can speak quite frankly….As a scientist I remain skeptical.” - Atmospheric Scientist Dr. Joanne Simpson, the first woman in the world to receive a PhD in meteorology and formerly of NASA who has authored more than 190 studies and has been called “among the most preeminent scientists of the last 100 years.”

Warming fears are the “worst scientific scandal in the history…When people come to know what the truth is, they will feel deceived by science and scientists.” - UN IPCC Japanese Scientist Dr. Kiminori Itoh, an award-winning PhD environmental physical chemist.

“The IPCC has actually become a closed circuit; it doesn’t listen to others. It doesn’t have open minds… I am really amazed that the Nobel Peace Prize has been given on scientifically incorrect conclusions by people who are not geologists,” - Indian geologist Dr. Arun D. Ahluwalia at Punjab University and a board member of the UN-supported International Year of the Planet.

“The models and forecasts of the UN IPCC “are incorrect because they only are based on mathematical models and presented results at scenarios that do not include, for example, solar activity.” - Victor Manuel Velasco Herrera, a researcher at the Institute of Geophysics of the National Autonomous University of Mexico

“It is a blatant lie put forth in the media that makes it seem there is only a fringe of scientists who don’t buy into anthropogenic global warming.” - U.S Government Atmospheric Scientist Stanley B. Goldenberg of the Hurricane Research Division of NOAA.

“Even doubling or tripling the amount of carbon dioxide will virtually have little impact, as water vapour and water condensed on particles as clouds dominate the worldwide scene and always will.” – . Geoffrey G. Duffy, a professor in the Department of Chemical and Materials Engineering of the University of Auckland, NZ.

“After reading [UN IPCC chairman] Pachauri’s asinine comment [comparing skeptics to] Flat Earthers, it’s hard to remain quiet.” - Climate statistician Dr. William M. Briggs, who specializes in the statistics of forecast evaluation, serves on the American Meteorological Society’s Probability and Statistics Committee and is an Associate Editor of Monthly Weather Review.

“For how many years must the planet cool before we begin to understand that the planet is not warming? For how many years must cooling go on?” - Geologist Dr. David Gee the chairman of the science committee of the 2008 International Geological Congress who has authored 130 plus peer reviewed papers, and is currently at Uppsala University in Sweden.

“Gore prompted me to start delving into the science again and I quickly found myself solidly in the skeptic camp…Climate models can at best be useful for explaining climate changes after the fact.” - Meteorologist Hajo Smit of Holland, who reversed his belief in man-made warming to become a skeptic, is a former member of the Dutch UN IPCC committee.

“Many [scientists] are now searching for a way to back out quietly (from promoting warming fears), without having their professional careers ruined.” - Atmospheric physicist James A. Peden, formerly of the Space Research and Coordination Center in Pittsburgh.

“Creating an ideology pegged to carbon dioxide is a dangerous nonsense…The present alarm on climate change is an instrument of social control, a pretext for major businesses and political battle. It became an ideology, which is concerning.” - Environmental Scientist Professor Delgado Domingos of Portugal, the founder of the Numerical Weather Forecast group, has more than 150 published articles.

“CO2 emissions make absolutely no difference one way or another….Every scientist knows this, but it doesn’t pay to say so…Global warming, as a political vehicle, keeps Europeans in the driver’s seat and developing nations walking barefoot.” - Dr. Takeda Kunihiko, vice-chancellor of the Institute of Science and Technology Research at Chubu University in Japan.

“The [global warming] scaremongering has its justification in the fact that it is something that generates funds.” - Award-winning Paleontologist Dr. Eduardo Tonni, of the Committee for Scientific Research in Buenos Aires and head of the Paleontology Department at the University of La Plata. # #

tes from Scientist that do not agree with Al Gore.

 

Global warming causes more and bigger extremes in weather, so it is consistant to say that yes bad cold weather is expected and more frequently....on the opposite side Russia had extreme heat waves, records not passed in 1000? odd years...

The US Congress will indeed start McCarhy style witch hunts, its been rumoured for a while....what we will see is political paper output written by a far right wing loon Govn hell bent on its own destruction.

One of your quotes, I checked.........."Professor Kunihiko Takeda, Ph.D., is vice-chancellor of the Institute of Science and Technology Research at Chubu University and one of the world's leading authorities on both uranium enrichment and recycling.

Like he is a climate expert?

uh huh.........

For how many years must cooling go on?” - Geologist Dr. David Gee

Cooling? some of these ppl cant be taken seriously........

regards

Cracks me up that the government had a working group on saving, when their asnwer to everything seems to be - borrow more money.

Then to add to that, their answer to everyone else is, lets get the OCR down and encourage everyone else to borrow more and save less, what else do they think that will encourage.

They have really made a total mockery of even bothering to have a savings working group at all.

Another thing, I can't see how a lower OCR helps Christchurch at all, if anything it's the opposite, because it will encourage stupid borrowing on housing again in other regions, which will probably tie up labour and resources that might have otherwise gone into helping Christchurch rebuild.