Tax capital says Gareth Morgan because those with the greatest need are often not those receiving the most under New Zealand's redistribution system

Tax capital says Gareth Morgan because those with the greatest need are often not those receiving the most under New Zealand's redistribution system

By Gareth Morgan

All capital yields a return. It may be in the form of taxable income, it may not. But people own or rent capital (land, structures, plants and equipment) for the services provided.

We own or rent our houses for the shelter they provide, our plant and machinery (cars, boats, home appliances, sausage-making machines) for the widgets or services that are generated.

What's produced we either sell or use ourselves but it is income.

Theoretically at least all income should be taxed if it is a fair income tax regime we seek. Practical difficulties can compromise achieving that goal but we must take great care over the inequities and inefficiencies created when we step back from the purist's 'ideal' income tax.

The second aspect of equity with tax regimes is that the ability of someone to pay tax is a fundamental differentiator in a mixed capitalist and government economy like ours.

The principle of taxation is that those with the greatest ability to pay tax should shoulder the greatest burden and those with the least should be the greatest beneficiaries of State redistribution.

Governments redistribute in a couple of ways - by providing equal access to a number of services, such as law and order, education and public health, and via direct transfers from the well-off to those who are not.

Redistribution is not just about absolute need it also reflects a government's values about wealth distribution. We have plenty of examples in the world where a wide division between rich and poor leads to political and social instability.

Societies like New Zealand have, at least in theory, eschewed that societal model long ago and so redistribute via the tax, transfer and government spending regime to achieve goals around capping disparities between rich and poor.

Labour looks like it's about to announce a capital gains tax. This type of tax has long been the subject of debate in New Zealand and at present we have a selective capital gains tax.

Tax applies if the purpose of your investment is to make a capital gain, in theory. I say in theory because a paradoxical feature of our investment landscape is the large number of assets that do not yield an income rate of return even equal to the risk-free rate the Government pays on its bonds.

Why then, you would wonder, would folk invest in assets whose income return is so deficient, if their purpose of investment was not capital growth, and why if this is the true objective do they not pay tax on capital gains? They will argue they're waiting for the long term when the income will grow, so really they are after income.

Rubbish.

The reality is commonly quite different, capital growth is a very attractive objective given that in reality it is easy to make it tax free. So long as the tax regime is so porous, we're encouraged to think along these lines, and to the extent we all do, we will all behave in the same manner and the capital gains will be assured. It is a self-fulfilling consequence of a compromised tax regime.

The allocation of our capital in New Zealand is not consistent with maximising productivity, or the generation of income.

It is this that is responsible for our poor growth in per capita incomes over several decades now, and our slippage down the OECD league tables.

But from the individuals' perspective, if you can make the most of your return from asset price appreciation then income generated is of secondary importance.

Back to tax. The vertical equity principle is one the tax and welfare regimes of most Western societies were founded on. It takes from each according to their means, and gives to each according to their needs.

The horizontal equity principle holds that persons in similar circumstances should have the same opportunities and be treated the same by the Government's redistribution regime. These are two of the rulers analysts run over a tax and benefit regime to measure its effectiveness.

On both counts the New Zealand regime has long been defunct. The highest contribution to the tax collect is not made by those with the greatest means, it is made by those with the highest taxable income.

These are not the same thing. I have a lot of wealth but very little income, I know of income earners who pay a lot more tax than I do.

Similarly, the greatest beneficiaries of the State redistribution regime are not those with the greatest need. I know of many folk receiving benefits (Working for Families and NZ Superannuation are total crocks in this regard) who have assets to die for.

Our redistribution regime is broken, it cannot be rectified with still more patches to a rotten core. We have a chronic misallocation of capital. Investment in capital here has very little to do with the taxable income generated, in some cases it is inversely proportional, people with the greatest means to pay tax are commonly asset-rich and deliberately income-poor.

The time for a tax on capital is overdue.

Specifically the tax should be levied on the value of the capital; should be liable every year with very limited scope for deferral; and should equate to the tax that would be paid if that capital was returning the minimum required rate of return we expect our capital to furnish. That is, the Government bond rate.

Income tax on capital earnings should then be levied in addition, albeit only upon the excess income earned above the minimum required rate. There should be no exemptions, certainly not the family home which is the biggest tax shelter presently available.

Reform of just this part of the tax and benefit regime is necessary but not sufficient to get our redistribution regime back on the rails and I'll outline more about what else is required in a later piece.

But a country with such a poor record on capital allocation cannot continue to be oblivious to the reality that the tax burden is skewed, without risking a major and damaging capital markets crisis eventually.

Labour looks like it's got its head at least around the issue that we have a huge hole in the efficient and equitable taxation of capital. The rumoured capital gains tax on realisation though, with an exemption for the biggest loophole of them all, the owner-occupied home, is a very poor way to address the issue. Tax dodging on capital gains taxes is simple, issues arise around impeding the pace of capital trading via lock-in, and revenue is volatile.

But Labour should at least be congratulated for addressing what we all know is the biggest tax rort in the country and one that has cost us all dearly in terms of efficient allocation of capital, economic growth and employment.

-------------------

Gareth Morgan is a Director of Gareth Morgan Investments
This article was first published in the NZ Herald.

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I hate it when politicians and economist invent taxes out of thin air to suit their agendas. (and they already tax thin air - its called carbon tax)

All this talk of taxing unrealised gains, land taxes etc., have we forgotten that landowners already pay a tax on property called Rates????

And it goes up every year way above inflation. If for one will not support any of the new taxes on property as I already pay one, any extra tax is just double dipping.

As a PAYE I pay rates as well...or are you of that simple a mind?

Simple any and all income should be taxed at the same rate no matter what it is....

regards

 

A land tax is the least worst tax and much easier to implement than Gareth's proposal.

Can be simply added to the current rates bill using existing GV's on unimproved.

Unless it's simple it wont work and be subject to abuse.

We need this additional revenue to address the looming structural deficit.

We need this additional revenue to address the looming structural deficit

We need another tax like a hole in the head. What we need is the parties to start coming out and explaining how they plan to reduce government spending long term, not introduce a new tax to fund their election bribes

So you think a capital tax, and lower income tax, is a bad thing? We all have capital. It's just in different places; yours in your houses, mine in the bank. Why not tax us both on what we have and less on what we produce (earn)? Sounds totally reasonable to me :) Sure; have a look at Government spending. But let's get sense back into the tax take, first. Think about it. The more I own, the more tax I pay; the harder I work, the less tax I pay. Where will you, or I, employ our effort?

"Why not tax us both on what we have" Hmmm, why not...not tax either of you on what you have? I mean, who really wants to give yet more tax to the govt? Do you really think they can use it/invest it better than you? Looking at current govt policies, I doubt it. There's already income tax, do we really need capital tax too (ie tax on money that has already been taxed)?

"The more I own, the more tax I pay; the harder I work, the less tax I pay. " I don't actually understand. If the harder you work, the less tax you pay then you end up with quite a lot of money in your pocket right? Then that money becomes capital (whether you leave it in the bank or buy a house with it), ie you now own more so you pay more tax anyway. So I'm not sure I understand the logic here. At the end of the day, you still get double-taxed.

Or are you suggesting splashing all of our after-tax income on a luxurious lifestyle to make sure we never "own" too much as a result of paying less income tax (surely weekly massages/pedicures/manicures/haircut/facials, a house cleaner, fancy restaurants and overseas holiday won't count as capital!)?

Actually the

weekly massages/pedicures/manicures/haircut/facials, a house cleaner, fancy restaurants and overseas holiday

all stimulate the economy and assist in growing the profits of local owner-operated businesses.  Whereas presently, locking up that excess capital in property related speculation (and the borrowing/mortgages that go with it) is detrimental to such owner-operated businesses.

The local manicurist for example, might spend the additional profit on new capital purchases - and hence grows the tax base whilst also employing more workers.

It's a mindset thing.  Think of a regime which signficantly reduces the percentage of overall tax collected on income and profit - and place the emphasis on taxing capital (accumulated wealth) and (my suggestion) resource use/depletion and pollution.

 

 

 

  

So you're basically saying "live in the 'today', don't have a care about tomorrow (the govt will surely take care of you with other people's taxes) and don't save a cent, spend all you have instead cos it's good for the economy".

No wonder this country has a savings problem! (Also, I am not sure the things I listed would provide what I'd call highly skilled/high income jobs and I doubt we need yet more low-income jobs in NZ).

No, I'm not saying that at all.  I'm saying that capital expenditure/investment is good under such a system - you do pay tax on it however.  But you pay far less tax on the income/profit you make in terms of the use of that capital.

But, if you don't want to accumulate capital assets (because you don't want to pay tax on them) - then your "live for the day" high spend lifestyle also has significant benefits to the overall economy.

I'd have to re-read his full proposal to understand what he says about taxation of money in the bank (savings).

There is no chance of cuts in govt size or the cost of running it. This goes against the very self serving nature of pupetual govt. Sure they want to be in charge but I has become clear that as ling as they have their nose in the trough & ruling people's lives with every growing intrusion , then they & their sponsors are happy. It's all about controlling people for maximum gains to the corporate owners. Ask yOurself , when was their a decrease is size or cost of the beauracratic state, number of mps, which is three times the uk per capita. why since I was a child following events do we have the same issues home & abroad in a loop going nowhere, but costing people ever more , financial & socially.

No, we need a gov that will work out a way to increase our productivity, which compares badly to the rest of the world. That way we don't need to reduce spending, which is quite hard to cut anyway, as the country seems to run on the smell of an oily rag.

Here's more from Gareth Morgan on his 'Big Kahuna' tax idea first presented at the Tax Working Group conference in December 2009

http://www.interest.co.nz/news/40961/gareth-morgan-proposes-comprehensive-capital-tax-25-flat-tax-replacement-all-benefits

cheers

Bernard

I have no issues with a capital gains tax. And yes I would like a lower tax rate. You have done well out of housing and have your million or two in the bank earning 5%. Good on you. But would you be happy with a retrospective capital gains tax on the capital gain you made?? 

Someone still has to address the dropping tax take and increasing Govt expenditure :)

Agree, funny how everyone wants to introduce taxes that won't now apply to them, we are always magnanamous with other peoples money.

@ 28_29 yr old: This article is not an arguement for CGT. It is for a Capital Tax. Each year, regardless of gain or loss, we would ALL pay, say, 1.5% of whatever out capital worth is. So, in effect, I would be paying tax on what I accummulated in the past. So would you. 

So, in effect, I would be paying tax on what I accummulated in the past. So would you

That's an interesting interpretation NA. Like I said before you have made your money from untaxed capital gains and its now in the bank...I don't envy that. But see the world through the eyes of a Gen Y not just from a boomer.

Question to you if you were in my shoes/my age where would you park your money right now??

If I were you, 28_29 yr old , I'd have my net worth in the bank ( funny that!) regardless of your age. There will come a time for diversification; back into business and other investments ( you already know I think property has had its day, and is unlikely to show returns reaped in the last 40 years, again). And ,yes, even assumption of debt. But from a much lower level of debt that is out there at the moment. Right now, it's 'wait and see' time. Often the hardest thing to do, is do nothing. Generation 'whatever', will then get their 'capital gain' from the lower asset prices that their stored money will be able to buy. It's a reverse of the last few decades way of 'doing things'.( PS: My daughter is Gen Y -1998, so I have her interests at heart above all)

Fair enough answer I just don't agree with you :)

Don't wait too long NA, you're not that young ;) I have my plan and will stick to that.....a lot of my generation have no plan and just drift along day to day and then get to 30 and moan they haven't got a thing.

Yep, so increase taxes, simple really.

There is a choice, pay a % in tax to the Govn for a service or pay double that to a private service provider which they may not honour.....who would be crazy enought to pay twice as much and possibly get nothing? Americans for sure and they are trying to change that....though they seem to have screwed it up this time around....

regards

Gareth: The principle of taxation is that those with the greatest ability to pay tax should shoulder the greatest burden and those with the least should be the greatest beneficiaries of State redistribution.

I stopped reading here. Whatever idea he might have that is good is akin to being a stopped clock being right twice a day.

Gareth's principle worked so well in the Soviet Union didn't it? And still works so well in North Korea and Cuba? Should all be great fabuluous utopia's if Gareth is right.

I largely agree with your sentiment.

Society is a funny thing isn't it? Why do we have so many rules in society and so much support for the weak, ill, or unfortunate? Mostly, I think it's because we never quite know what our future holds. Tomorrow, that could be me that develops a cancer or other illness, crippled in a car crash through no fault of my own, be working in a business that goes under, caught up in a catastrophe like Christchurch just has and continues to do so.

It annoys me though when you see so many people supported in society who's only misfortune is their own inability to take responsibility for their own life and decisions made. This is where I get so frustrated with the hand out culture that continues to fester here in this country and supported with comments like that one you have highlighted.

"It is said that the worth of society can be measured by the manner in which it treats its weakest member"

The inverse of that is you can tell the state a country is in by those who call the shots.

Tel ya what, for the first time I intend to vote for the Party who shows some smart nads! Red or Blue.

We are in serious trouble. The time is over for trivial work arounds, if the dam system is broke then why not follow the TWG's advice. The petty solutions of politicians, vote geared are boring, lazy and visionless!

A 25% flat tax sounds good! For all those who are tired of another tax ie CGT, try to think a bit longer term, and about whats good for the country.

Often a nicely engineered product lokks simple to the untrained eye.

To clarify , you indicate that you have been a same party voter mindlessly up till now, but now your vote can be brought by either or any party from here on?

Marty there is no difference. The factions you refer is exactly what we see in Nz isn't it. Don't be fooled into thinking you can see the real power brokers , they are not electable. Why are people so fooled by it all still. Get yourself a look @ Tragedy & Hope by Carrol Quigley. Or read any of he links I've posted Marty , if you had you would understand.
Have you got a copy of the opal files yet? Have you heard of it ?

Marty , most people have absolutely no idea of how the world works , or how it influences their lives & why. Heck most wouldn't even know where to look , should they decide to.

Marty it's already happened mate , long ago ! Economic, financial , social , environmental systems are a big part of the world. What state are they all currently in Marty ! See any sign of it getting better ? If you can't see what's wrong in front of you , you have not been able to feel or see it going wrong. Plenty of words for that eh

Andrew I think that location missed some , here it is. Part of the wider Gemstone files. Cross reference and research validates far too much.

10th June, 1967:

Hunt and New Zealand Finance Minister reach an agreement: Hunt will receive sole drilling rights and Muldoon will receive a $US100,000 non-repayable loan from Hunt’s Placid Oil Co.

8th September, 1967:

Placid Oil granted drilling rights to the Great South Basin.

10th May, 1968:

Hawaiian meeting between Onassis and top lieutenants William Colby and Gerald Parsky to discuss establishment of a new front company in Australia – Australasian and Pacific Holdings Limited – to be managed by Michael Hand. Using Onassis-Rockefeller banks, Chase Manhattan and Shroders, Travelodge Management Ltd sets up another front to link the operations to the US.

Onassis crowned head of the Mafia; Colby (head of CIA covert operations in S.E. Asia) ran the Onassis heroin operations in the Golden Triangle (Laos, Burma, Thailand) with 200 Green Beret mercenaries – i.e. the Phoenix Programme.

Gerald Parsky deputy to ex-CIA/FBI Robert Maheu in the Howard Hughes organization, took orders from Onassis and was made responsible for laundering skim money from the Onassis casino operations in Las Vegas and the Bahamas.

Mid-July, 1968:

Placid Oil Co and the Seven Sisters (major oil companies) begin Great South Basin oil exploration – Hunt finances 45.5% of exploration costs, Gulf Oil 14.5%, Shell (US) 10%, B.P. Oil 10%, Standard Oil California 10%, Mobil 6.5% and Arco 6.5%.

12th October, 1968:

Hunt and Seven Sisters announce confirmation of new oil source comparable to the Alaskan North Slope – gas reserves estimated at 150 times larger than the Kapuni Field.

Early 1969:

Mafia consolidates its banking operations; David Rockefeller becomes Chairman of Chase Manhattan; Wriston at Citibank and Michele Sindona captures the Vatican Bank, Partnership Pacific launched by Bank of America, Bank of Tokyo and Bank of New South Wales.

24th February, 1969:

Onassis calls Council meeting in Washington to discuss strategy to monopolize the Great South Basin discovery. Council members included Nelson Rockefeller and John McCloy, who managed the Seven Sisters, and David Rockefeller, who managed the Mafia’s banking operations.

McCloy outlines the plan to capture all oil and mineral resources in Australia and N.Z.

10th March, 1969:

Parsky and Colby use Australasian and Pacific Holdings to set up a ’front’ company in Australia. Using old banks – Mellon Bank and Pittsburgh National Bank – they buy control of near-bankrupt Industrial Equity Ltd (I.E.L.) managed by New Zealander Ron Brierly. ’Australasian and Pacific Holdings’ ’consultant’ Bob Seldon helps Michael Hand set up the new organization. Seldon took orders from Mellon and Pittsburgh National Banks, while Hand was directly responsible to Gerald Parsky and William Colby. Ron Brierly would take orders from Hand.

24th July, 1969:

New board established for I.E.L. includes Hand, Seldon, Ron Brierly, plus two Brierly associates – Frank Nugan and Bob Jones. Both are appointed consultants to Australasian and Pacific Holdings Ltd.

Jones will help Brierly launder funds into real estate (Brierly/Jones Investments) while Seldon and Nugan will channel funds into oil and mineral resources through I.E.L.

October 1969:

Chase Manhattan begins new operation in Australia with National Bank Australasia and A.C. Goods Associates – Chase-NBA.

J.C. Fletcher appointed chairman of Seven Sisters’ company – British Petroleum (N.Z.).

17th February 1970:

Gerald Parsky sets up a new heroin-dollar laundry in Australia – Australian International Finance Corp – using the Irving Trust Co. New York.

April 1970:

Onassis, Rockefeller and the Seven Sisters begin setting up the shadow World Government using the Illuminati-controlled banks and the transnational corporations. In Melbourne they set up the Australian International Finance Corporation using:

*

Irving Trust Co. N.Y. – linked to Shell Oil, Continental Oil, Phillips Petroleum.
*

Crocker Citizens National – linked to Atlantic Richfield (Arco), Standard Oil of California which is Rockefeller-controlled.
*

Bank of Montreal – Petro Canada, Penarctic Oils, Alberta Gas, Gulf Oil.
*

Australia and New Zealand Bank (ANZ).

Meantime,

*

Japanese members of One World Government move into New Zealand, helped by Finance Minister R. Muldoon
*

Mitsubishi and Mitsui make a profitable deal buying up rights to ironsands helped by Marcona Corp. (US) and Todd (Shell/BP/Todd)
*

Todd rewarded with sole New Zealand franchise for Mitsubishi vehicles
*

Muldoon helps Mitsui (Oji Paper Co) obtain a lucrative 320 million cubic foot Kiangaroa Forestry contract with Carter Holt

November, 1970:

Fletchers extend the Rockefeller Travelodge operation by buying control of New Zealand’s largest travel company – Atlantic and Pacific Travel.

Manufacturers’ and Retailers’ Acceptance Company (in 1970 changed to Marac): This firm specialises in leasing and factoring (buying debts at a discount). It also finances imports and exports.

The major shareholders are:

*

the Fletcher Group (38.0%),
*

the Commercial Bank of Australia Ltd (24.7%),
*

NIMU Insurance (7.7%),
*

Phillips Electrical (3.8%),
*

National Mutual Life Association (2.4%),
*

New Zealand United Corporation (4.0%).

The CBA is a partner in the supranational Euro-Pacific Corporation, the other partners being the Midland Bank (UK), the United California Bank (USA), Fuji (Japan) and Societe Generale de Banque (France).

Early 1971:

Onassis and Rockefeller begin global operation to buy influence for the One World Government concept. They use Lockheed, Northrop and Litton Industries ’agent’ Adnan Khashoggi, to organize operations in the Middle East, Iran and Indonesia. I.C.I. set up $2.5 million slush fund to Australia and N.Z.

Finance Minister Muldoon changes law to allow Mafia-controlled banks to begin operations in New Zealand. Links also made by N.Z.I. in preparation for:

*

Paxus control with Hong Kong and Shanghai
*

Wells Fargo with Broadbank
*

Chase Manhattan with General Finance
*

Bank of America and Barclays with Fletchers and Renouf in New Zealand United Corp

All members of the Business Round Table Organization.

Late 1971:

Gulf Oil and their man Brierly begin organizing chains of Shell companies and dummy corporations to conceal their takeover operations of oil, gas and mineral resources and related industries such as vehicle franchises, vehicle spare parts and finance services – all part of the Seven Sisters’ controlled car culture.

To extend links to the US banking operations they buy control of I.S.A.S. (NSW) and I.S.A.S. (Qld), which hold sole franchise for construction and mining equipment produced by International Harvester Credit Co, which is part of Chase Manhattan Bank and associated with First National Bank Chicago (Chairman Sullivan also Executive Vice-President of Chase Manhattan), Continental Illinois (linked with CIA and Mafia Michele Sindona of Vatican Bank) and Rockefeller’s Standard Oil of Indiana (AMOCO).

I.S.A.S. (Qld) also has strategic holdings in North Flinders Mines, Flinders Petroleum, Apollo International Minerals.

February 1972:

Onassis and Rockefeller help associate Adnan Khashoggi buy the Security Pacific National Bank in California and take control of the United California Bank through CIA-linked Lockheed Aircraft Corporation. Both banks used by Onassis and Khashoggi to funnel bribes and payoffs via the CIA’s Deak Bank to captive Japanese and other crooked politicians. Security Pacific also used to ’launder’ over $2 million for Nixon’s re-election campaign. Khashoggi also buys 21% of Southern Pacific Properties, which is the major stockholder in Travelodge (Aust), thereby establishing direct links to New Zealand, and U.E.B. and Fletchers through its equity links with Travelodge (N.Z.).

April 1972:

Mafia banking operations expanded through New Hebrides with establishment of Australian International Ltd to finance Pacific development by the oil companies (Seven Sisters). Banks involved include Irving Trust NY, Bank of Montreal, Crocker International, Australia & N.Z. Bank and the Mitsubishi Bank, whose president, Nakamaru, is appointed Chairman.

26th May, 1972:

Gerald Parsky installs Michele Sindona as ’owner’ of Franklin National Bank, helped by the Gambino Mafia family and David Kennedy – Chairman of Continental Illinois Bank and Nixon’s Secretary of the Treasury.

Pacific Basin Economic Council Conference in Wellington, NZ. Vice-President Shigeo Nagano also chairman of Nippon Steel and member of Onassis and other World Government organizations. Chairman of NZ sub-committee, J. Mowbray is also General Manager of the National Bank.

Meanwhile, Michele Sindona, acting as the go-between for the Mafia and the CIA, was the conduit between US and European banks. Michele Sindona’s Vatican Bank and associate Calvi’s Abrosiano Bank was used to finance CIA neo-fascist Italian/Latin American operations through Licio Gelli’s P2 Lodge, which helped to organize the ’death squads’ of Argentina, Uruguay and Chile. This aided the P2 members such as Klaus Barbie (’The Butcher of Lyons’) and Jose Rega – organizer of the A.A.A. in Argentina.

16th August, 1972:

Gulf Oil associate Bob Seldon helps establish new banking operation, first NZ international banks include Bank of New Zealand, D.F.C. (Aust), N.Z.I., Morgan Guaranty Trust, Morgan Grenfel and S.F. Warburg.

Fletchers begins expansion overseas with deals signed in Indonesia, Fiji and New Guinea.

December 1972:

Kirk elected Prime Minister of New Zealand.

February, 1973:

Gerald Parsky, William Colby, Michael Hand, Frank Nugan and Bob Seldon move to further consolidate the Mafia banking operations. In NZ they acquire 20% Fletcher subsidiary Marac, using the Security Pacific National Bank helped by Marac Corporate secretary Alan Hawkins.

Frank Nugan and Michael Hand use Fletcher and Renouf and their NZ United Corporation to link with I.E.L. and Brierly Investments through cross-shareholding agreement.

In Australia, the Nugan Hand Bank begins operations with 30% of the stock held by Australasian and Pacific Holdings (100% Chase Manhattan Bank), 25% by CIA’s Air America (known as ’Air Opium’), 25% by South Pacific Properties and 20% held by Seldon, Nugan and Hand.

The Irving Trust Bank’s New York Branch establishes US links between the CIA and Nugan Hand, a worldwide network of 22 banks set up to:

a)   ’launder’ money from Onassis heroin operations in the Golden Triangle and Iran

b)   as a CIA funnel to pro-US political parties in Europe and Latin America, including Colby’s P2

c)   a spying conduit for information from Cambodia, Laos, Vietnam and Thailand

d)   finance arms smuggled to Libya, Indonesia, South America, Middle East and Rhodesia using the CIA’s Edward Wilson

Colby and Kissinger use key CIA and Naval Intelligence officers to oversee the operation, including Walter McDonald (former Deputy Director CIA), Dale Holmgren (Flight Service Manager CIA Civil Air Transport), Robert Jansen (former CIA Station Chief, Bangkok), etc.

Heroin flown into Australia by CIA’s Air America and trans-shipped to Onassis lieutenant in Florida, Santos Trafficante Jr, assisted by Australian Federal Bureau of Narcotics officials and coordinated by CIA’s Ray Cline.

14th June, 1973:

Inauguration of the Onassis shadow World Government – the Trilateral Commission. Includes over 200 members from the US, Europe and Japan – bankers, government officials, transnational corporations’ top executives, trade unionists, etc. Of the world’s largest corporations, 24 directly represented and dozens more through interlocking directorships.

* Trilateralist strategy: monopolization of the world’s resources, production facilities, labour technology, markets, transport and finance. These aims backed up by the US military and industrial complexes that are already controlled and backed up by the CIA.

18th August, 1973:

Ray Cline and Michael Hand meet in Adelaide to discuss CIA plan to establish spying operations in NZ.

September 1973:

Seagram’s, with strong links to Chase Manhattan Bank of Montreal and Toronto Dominion Bank, buys 2,800 acres of prime land in Marlborough helped by Peter Maslen.

17th February, 1974:

Mafia sets up New Hebrides Bank – Commercial Pacific Trust Co (COMPAC). Banks include CBA, Europacific Finance Corporation, Trustee Executors and Agency Co, Fuji Bank, Toronto Dominion Bank, European Asian Bank and United California Bank, COMPAC to be used as a cover for heroin dollar laundering operations.

26th February, 1974:

Michael Hand meets Bob Jones in Wellington to implement plans for the CIA’s new spying operation – countries targeted include France, Chile, West Germany and Israel.

Using the Brierly/Jones Investment funnel, Jones buys building in Willeston Street which will be rented to France and Chile, another at Plimmer Steps to house West Germany and Israel.

CIA will set up eavesdropping communications centre inside the Willeston Street building and another at 163 The Terrace which will link with equipment installed in the Plimmer Steps building. Four CIA technicians will run the whole operation.

April 1974:

Finance Minister Rowling appoints Ron Trotter to the Overseas Investment Commission, whose chairman, G. Lau, is also a member of the Todd Foundation (Shell/BP/Todd) investment board.

Whitlam and Kirk
Mid-1974:

Gough Whitlam and Norman Kirk begin a series of moves absolutely against the Mafia Trilateralists. Whitlam refuses to waive restrictions on overseas borrowings to finance Alwest Aluminium Consortium of Rupert Murdoch, BHP and R.J. Reynolds. Whitlam had also ended Vietnam War support, blocked uranium mining and wanted more control over US secret spy bases – e.g. Pine Gap.

Kirk had introduced a new, tough Anti-Monopoly Bill and had tried to redistribute income from big companies to the labour force through price regulation and a wages policy.

Kirk had also rejected plans to build a second aluminium smelter near Dunedin and was preparing the Petroleum Amendment Bill to give more control over New Zealand oil resources.

Kirk had found out that Hunt Petroleum, drilling in the Great South Basin, had discovered a huge resource of oil comparable in size to the North Sea or Alaskan North Slope. Gas reserves alone now estimated at 30 times bigger than Kapuni and oil reserves of at least 20 billion barrels – enough for New Zealand to be self-sufficient for years. Oil companies completely hushed up these facts. To have announced a vast new oil source would probably mean a decline in world oil prices, which would not have allowed OPEC and Onassis plans for the Arabs to eventuate. N.Z. could be exploited at a later date, particularly since the North Sea operations were about to come on stream – Kirk was the last to hold out.

September, 1974:

According to CIA sources, Kirk was killed by the Trilateralists using Sodium Morphate. Rowling’s first act as NZ Prime Minister was to withdraw Kirk’s Anti-Monopoly Bill and the Petroleum Amendment Bill.

Later, Rowling was to be rewarded with ambassadorship to Washington. Incidentally, the Shah of Iran was murdered the same way as Kirk on his arrival in the US.

6th October, 1974:

Ray Cline implements William Colby plan to oust Australian Prime Minister Whitlam. Nugan Hand Bank finances payoffs to Malcolm Fraser and other pro-US politicians. A joint bugging operation commences between CIA and ASIA.

Rupert Murdoch, playing his part, uses his newspapers and television network to spread lies and misinformation. Whitlam, as well as refusing to waive restrictions on overseas borrowing to finance the aluminium consortium, had plans to ensure that all corporations were at least 50% Australian-owned. This interfered with the Seven Sisters’ plans to build three oil refineries at Cape Northumberland in South Australia to exploit the Great South Basin discovery.

December, 1974:

Australian Governor-General John Kerr joins Ray Cline’s payroll and received his first pay-off of $US200,000 credited to his account number 767748 at the Singapore branch of the Nugan Hand Bank.

11th November, 1975:

Governor-General Kerr sacks the Whitlam Government.

August 1975:

Rowling re-introduces unrecognizable Commerce Bill, designed to aid monopolization of the NZ economy and repeals the News Media Ownership Act, allowing more foreign ownership of NZ media. The new legislation does not define monopoly, competition or stipulate permissible maximum market share, or even ascertain what the public interest is – resulting in a sell-out to big business.

December, 1975:

Election battle between Rowling and Muldoon. Oil companies pour thousands of dollars into Muldoon’s campaign via National Bank (NZ), whose general manager Mowbray is also a member of Todd Foundations; Investment Board Director Tudhope also Managing Director Shell Oil and Chairman Shell/BP/Todd. Muldoon wins.

February, 1976:

Muldoon implements pre-election secret agreement with the NZ Seven Sisters’ oil representatives of Shell/BP/Todd for helping finance the National Party campaign.

Muldoon removes the $3 per barrel oil levy for the New Zealand Refining Company, which increases the oil companies’ profits by 100% at the taxpayers’ expense and with all future oil prospecting licenses, the Government has the option to take 51% of any discovery without meeting exploration costs. This is designed to discourage further exploration, thereby keeping the lid on the Great South Basin discovery.

Meanwhile, in Australia, new P.M. Malcolm Fraser reopens uranium mining and opens the way for takeover of mineral resources with big tax breaks for oil exploration, coal and mining.

Muldoon returns a favor to the oil companies by arranging $US200 million loan for Maui Gas Development for Shell/BP/Todd.

September, 1976:

With captive politicians in place in both Australia and New Zealand, the Internationalists can now proceed with their strategy of takeover of the economy and exploitation of natural resources.

“In New Zealand, the elimination of unnecessary competition is fundamental to a sound economy,” Brierly says.

Parksy and Colby use Brierly/Jones Investments as a vehicle to buy into A.B. Consolidated Holdings in New Zealand.

Associate of R. Jones, Pat Goodman, is appointed ’consultant’ of Australasian and Pacific Holdings.

November, 1976:

The Internationalists (Mafia) set up a NZ money ’funnel’ using Brierley’s City Realties. National Insurance Co acquires 33% of the stock. Largest stockholders in National Insurance are the US Firemen’s Fund – Chairman and President Myron Du Bain also Vice Chairman of American Express (Amex). Chairman of I.E.L. linked International Harvester, Archie McCardell, also Amex Director. Amex linked with Chase Manhattan and seven Sisters’ Texaco and Mobil. Du Bain also Director of CIA-linked United California Bank, which is a partner in Commercial Pacific Trust.

To complete the money funnel, National Insurance becomes a stockholder in Chase Manhattan’s Chase-NBA. Brierley’s declared assets reach $100 million, with shareholder’s capital of only $2.5 million – all cash acquisitions.

3rd February, 1977:

Parksy and Colby close down the Brierley/Jones Investment funnel and open up separate channels for Brierley and Jones. Jones will be supplied with ’laundered’ funds via Sydney branch of the Nugan Hand Bank, while for Ron Brierley, Gerald Parsky uses Myron Du Bain, Dierctor of United California Bank and also chairman and president of the US Firemen’s Fund, which are the largest stockholders in National Insurance (NZ). Funds to be ’laundered’ via Chase Manhattan Bank through National Insurance to City Realty and via United California Bank through COMPAC (New Hebrides) to National Insurance and City Realties.

To expand the Bierley/I.E.L. ’front’, Parsky establishes Industrial Equity Pacific (Hong Kong).

September 1977:

Brierley’s new holding company begins operations – A.B. Consolidated. H.W. Revell appointed Deputy Chairman and B. Hancox General Manager, while newly-appointed directors include S. Cushing, B. Judge, O. Gunn and P. Goodman, linked with Renouf, Fletcher and Papps through I.E.L./N.Z.U.C.

* Strategy: To target and divide key sectors of the economy for takeover, exploitation and monopolization. Operations to extend to use Hong Kong facility, I.E.P. Fletchers to extend the Khashoggi/Rockefeller Travelodge operation by taking holdings in Vacation Hotels and Intercontinental Properties (Renouf Chairman).

October, 1977:

Muldoon and John Todd – Shell/BP/Todd – sign an agreement. NZ Govt would take 24.5% holding in the Great South Basin for $1.65 Billion. Hunt would reduce his holding from 45.5% to 27.5% and Arco would sell its 6.5%.

* Reason: Hunt did not possess the technology to pump oil from deep water; Gulf possessed the technology but did not tell Hunt. Arco was not told anything and were swindled out of its 6.5% concession.

November, 1977:

Muldoon introduces the S.I.S Amendment Bill, designed to keep the economy free of obstruction and to help uncover obstructive elements. Telephone taps, mail tampering and other surveillance methods approved after CIA input on contents of legislation.

Late 1977:

Muldoon travels to the US to meet top Rockefeller officials, including Trilateralists’ Deputy Secretary of State, Warren Christopher, and Richard Bolbrooke, who were in charge of the new “South Pacific Desk” at the State Department established by Rockefeller to target exploitation of both New Zealand and Australia. In Los Angeles, Muldoon meets top Rockefeller officials, Robert Anderson (Rockwell Chairman, also Director of Kashoggi’s Security Pacific National Bank) and P. Larkin (Rockwell Director, also Chairman, Executive Committee Security Pacific National Bank and Director of Marac).

April, 1978:

Muldoon sets up Petrocorp. New Zealand taxpayers pay for the exploration costs but the oil companies control all distribution outlets. Muldoon blocks development of Maui B as restructured supplies mean higher prices and bigger profits for Shell/BP/Todd. South Island gas market not developed as Great South Basin fields closer than Kapuni. Plans develop for re-opening of National Parks for mineral exploitation.

22nd July, 1978:

Director of Australian Federal Bureau of Narcotics suspends his investigation into the Nugan Hand Bank after pressure from the CIA and Australian politicians controlled by Mafia, particularly Malcolm Fraser.

Brierly’s declared assets reach $200 million, with shareholders’ funds only $17 million.

May, 1979:

Trilateral Commission secretary Zbignieu Brzezinski appoints Muldoon chairman of Board of Governors of IMF/World Bank on orders of David Rockefeller. Muldoon would head three-man administration committee which included Canadian Finance Minister Mitchell Sharp, key figure in the Mafia Council and the Trilateral Commission. Australian Treasurer McMahon also involved.

8th June, 1979:

Michael Hand, Frank Nugan, Brierley and James Fletcher meet in Hand’s Sydney penthouse to discuss the establishment of the New Zealand Mafia organization.

Mid- 1979:

Gulf Oil using its man Brierley, begins operations designed to capture key sectors of the economy. A.B Consolidated restructured into the Goodman Group and Goodman to run operations but with the majority of the stock held by IEL and Brierley using Shell companies plus dummy corporations.

* Strategy: To take over food and produce resources, Brierley and Fletcher restructured a small private company, H.W. Smith, using Cyril Smith as Chairman but with key executives Judge, Collins and McKenzie. Bob Jones helps.

Private company used, as no Commerce Commission control, accounts not published, no public disclosure of transactions. Bunting is established as a shell company and the South Island is targeted for asset-stripping and takeover, as well as key sectors of the automobile industry.

Unlimited funds channeled through City Realties, NZUC and Marac extends Travelodge operations by buying control of Transholdings, which has strategic holdings in Vacation Hotels and Tourist Corp. Fiji Holdings.

17th August, 1979:

New Zealand Mafia inaugural meeting in Sydney including Hand, Brierley, Fletcher, Goodman, R.Trotter, Alan Hawkins and L.Papps.

Key sectors of the economy would be taken over- food, using Goodman; forestry and farming, using Fletcher and Trotter; property, using Brierley and Jones. Brierley, Hand and Papps would be responsible for banking, insurance and finance, while Hand and Hawkins would be responsible for setting up new “laundry” channels into New Zealand.

The economy would be taken over using cheap loans of less than 5%, while consumers would pay 28%.

October, 1979:

BP Oil begins $100 million joint venture deal with Fletcher and Trotter at Tasman.

Muldoon makes secret deal with oil companies which effectively robs New Zealand taxpayers by giving Shell/BP/Todd the Maui Gas deal. Normally the granting of drilling rights on public land is done using a worldwide system which incorporates an auction tender system. Muldoon bypassed this. Also, Shell/BP/Todd pays no tax on Kapuni profits, while putting funds into Maui development.

19th November, 1979:

Secret meeting in Auckland between Muldoon, Fletcher and Trotter to transfer 43% Tasman Pulp and Paper held by New Zealand Government to Challenge Corporation (Chairman Trotter) and Fletchers. Tasman has lucrative 75-year contract for cheap timber signed in 1955.

Muldoon paid off with a $1 million ’non-repayable’ loan – $500,000 to be paid into account number 8746665 at New Hebrides branch of the Australian International Bank.

November, 1979:

Muldoon drops restrictions on foreign investment. AMAX (Standard Oil of California subsidiary) captures the Martha Hill goldmine.

Muldoon unveils the Government’s plans (instructed by Rockefeller) to form New Zealand into an offshore production base for the multi-national corporations as benefits include government export incentives, stable government, cheap labour, and so on.

27th November, 1979:

Gerald Parsky’s lieutenant, David Kennedy, meets Muldoon to deliver $US100,000 cash to Muldoon for implementing the Internationalists’ Mafia Think Big plans.

These plans began with big contracts and guaranteed profits for the Seven Sisters, Bechtel, Mitsubishi, Mitsui, Nippon Steel, Internationalists’ Mafia banks.

With the experimental petroleum plant, the oil price has to be $50/barrel to be profitable, yet Mobil’s profits are guaranteed.

New Zealand Steel is to be expanded 500%, even though there was a global steel glut of 50%.

Fletchers own 10% of New Zealand Steel and are majority stockholders in Pacific Steel and control monopoly over wire rod, reinforcing steel. Also, New Zealand taxpayers subsidize Fletchers’ profits.

Muldoon introduces the National Development Bill with ’fast-track’ legislation, to keep the economy ’free of obstruction’ for long-term monopolization. C.E.R. plan introduced, designed to integrate the economies of Australia and New Zealand with the Trilateral Commission for the purpose of exploiting the South Pacific countries and as a ’back-door’ entrance into China – the world’s largest untapped consumer market. New Zealand is also the closest country to Antarctica, which has a vast mineral resource for future exploitation.

“Think Big” projects begin, even though Muldoon aware of studies that show New Zealand could conserve up to 40% of energy consumption using existing technology, which would mean funds could be invested elsewhere to lower consumer prices, lower inflation rates, less demand for imported oil and increased employment by creating new industry to manufacture and install energy-saving technology. None of these options seriously considered as all would lessen profits for members of the Rockefeller organizations.

December 1979:

Muldoon unveils ’stage two’ of a four-stage plan to exploit the Great South Basin discovery. Plan prepared by Trilateralist ’Think Tank’ – the Brookings Institute.

’Stage Two’ includes methanol plant and synthetic petrol plant, which would initially use gas from the Maui field and later would link with underwater gas pipe from Campbell Island.

With the New Zealand Steel 500% expansion, ’stage three’ of the project and Think Big contracts to go to Bechtel, Fluor Corp., Mitsubishi, Mitsui, Nippon Steel, etc. All investments would be financed by the New Zealand taxpayer.

17th January, 1980:

$500,000 deposited in Muldoon’s account number 8746665 at the Australian International Bank, being the final payment for the Tasman deal.

Early 1980:

Kashoggi Travelodge operations extended with affiliation agreement between Dominion Breweries and Western International Hotels (Seattle First National Bank).

May, 1980:

Mafia’s Nugan Hand banking operation crashes after Frank Nugan killed. Death ruled as suicide even though no fingerprints found on the rifle. Maloney, Houghton, Yates and Hand shred important documents, but miss some. CIA helps Hand and Bank President Donald Beasley escape to the U.S. The CIA and Australian Security Intelligence Organization cover everything up. Beazley appointed President of Miami City National Bank, run by Alberto Dugue for ’laundering’ profits from the CIA Colombian cocaine operation.

There is a probability that Michael Hand killed Frank Nugan because of his involvement with Hand’s fiancée.

25th May, 1980:

Colby arrived in Australia to discuss replacement of the Nugan Hand Bank with Hand, Brierley, and Seldon. Immediate funding available from Sydney branch of the Deak Bank, a separate CIA operation, and IEL would be used to buy NZI Corp., to prepare for future laundering operations.

Maloney, Houghton, Yates, and Hand would shred all documents leading back to the New Zealand Great South Basin connection, and the CIA would help Hand and Bank President Donald Beazley escape to the USA. The CIA and ASIO would also cover everything up.

Hand and Beazley turn up in Miami – Beazley appointed President and Hand ’consultant’ to the Miami City National Bank, but also Hand turned up in El Salvador to help organize bankrolling of the Contras with other ex- members of Nugan-Hand.

23rd June, 1980:

New Zealand Mafia, including Brierley, Fletcher, Trotter, Jones, Hawkins, Goodman, and Papps meet in Wellington to discuss merger of Fletcher Challenge and Tasman.

In order to replace Nugan Hand Bank’s 22 world-wide branches, quick moves are made to buy control of NZI by New Zealand Mafia using Brierley, thereby capturing an established, world-wide organization through the Hong Kong and Shanghai Bank, which is also linked to the CIA through its subsidiary, World Finance Corporation.

Late 1980:

Fletchers, with strong Rockefeller links, obtains lucrative contracts on US Bases in the Pacific and joint ventures in Saudi Arabia and Iraq.

Control extended over New Zealand natural resources – Fletcher Challenge and Tasman Pulp and Paper merged. NZFP takes control of M.S.D. Spiers and Moore Le Messurier (Aust). Brierley begins joint venture with NZFP through Williamson and Jeffrey. I.E.L, through Goodman, buys 20% of Watties and begins cross-shareholding agreement. Goodman continues buying up control of NZ bakeries and flour- mills.

February, 1981:

TNL., Brierley, AMOIL and MIM Holdings begin joint gold mining operation. MIM major shareholder is ASARCO (US), whose Chairman, Barber, is also Director of Chase Manhattan Bank.

New Zealand Insurance and South British merger.

Parliamentarians For World Order – Richard Prebble elected one of twelve councilors.

Fletcher and Papps (Chairman UEB) sell their hotel operations to Singaporian interest closely associated with the Pritzker family – owners of the Hyatt Hotel chain. Bueton Kanter, Pritzker family lawyer and Director of Hyatt Hotels, who helped arrange the deal, was an old family partner of Paul Helliwell (CIA paymaster for the Bay of Pigs fiasco) and had helped the Pritzker family set up tax shelters using the CIA’s Mercantile Bank and Trust and the Castle Bank, which had been set up by Helliwell for ’laundering’ profits from the Onassis heroin operations as well as ’skim money’ from the Hughes casino operations in Las Vegas.

Others who used these banks include Richard Nixon, Bebe Rozo, Robert Vesco, Teamsters Union, etc.

12th March, 1981:

Brierley calls secret meeting in Auckland, which includes Jones, Fletcher, Hawkins, Papps and Burton Kanter, to discuss transfer of the Fletcher Challenge and UEB hotel operations to the Singapore front company controlled by the Pritzker family.

20th July, 1981:

Parsky, Colby, Brierley and Seldon meet in Sydney with two new members, Kerry Packer and Alan Bond.

Chase Manhattan and Security Pacific National Bank will acquire 60% of Packer’s company, with the stock being held in Australia, and 35% Bond’s company, with the stock being held in Hong Kong.

August 1981:

Gulf Oil, using Brierley, strengthens its hold over New Zealand natural resources. Cue Energy launched, starring Lawrey and Gunn. NZOG launched with strategic holdings by Jones, Renouf and Brierley with licenses in PPD 38206 and 38204 – both next to Hunt’s Great South Basin discovery, NZOG also controls 80 million tonnes of coal through the Pike River Coal Company.

Brierley-controlled Wellington Gas, Christchurch Gas, Auckland and Hawkes Bay Gas and Dual Fuel Systems (Australasia) which controls the vehicle gas conversion market.

Liquigas Limited set up to distribute LPG, controlled by Shell/BP/Todd and Fletcher Challenge.

15th February, 1982:

Brierley calls New Zealand meeting – Jones, Fletcher, Trotter, Hawkins, Goodman and Papps. New members include Bruce Judge, J. Fernyhough, and Frank Renouf.

With Muldoon about to deregulate the liquor industry, Brierley and Fernyhough plan to buy up the New Zealand liquor industry, along with its outlets, Lion Breweries and Rothmans to help.

Brierley will do the same in Australia. J.R. Fletcher becomes Managing Director of Brierley’s Dominion Breweries to oversee operations. Rothmans and Brierley (through Goodman) have equal holdings in Saudicapital Corp. Lion Directors Myers and Fernyhough also stockholders in NZOG.

Fletcher and Brierley begin their takeover of the freezing works industry. FCL buys into South Island works while Brierley begins takeover of Waitaki NZR through Watties with the help of Athol Hutton.

With Think Big projects beginning, Fletcher and Trotter plan to take strategic holdings in NZ Cement, Wilkins Davies, Steel & Tube etc., and Brierley would use Renouf to take 3% stake of the Martha Hill gold-mine.

Also targeted are clothing, footwear, carpet manufacture and more of the auto industry for takeover and monopolization.

June, 1982:

Meantime, in Australia, an new money funnel begins. H.W Smith buys to obscure South Pine Quarries, which is renamed Ariadne (Aust). South Pine Quarries owns 50% of Coal-Liquid Inc., with the other half owned by US Defense contractors McDonnellDouglas. Coal-Liquid renamed Impala Securities.

The common link between Gulf Oil and McDonnell Douglas is the CIA’s Mercantile Bank and Trust, which both companies use for world-wide bribery and payoff operations. McDonnell Douglas officials McKeough and G.T.Hawkins later appointed directors of Impala Securities.

US links strengthened through Industrial Equity Pacific, which acquires part of Higbee Company in Cleveland, which in turn is closely linked to the National City Bank of Cleveland. This bank is closely associated with Gulf Oil’s bank, Pittsburgh National and Mellon Bank.

Bruce Judge installed as Ariadne manager.

July, 1982:

Media takeover begins. Brierley takes 24% NZ News Ltd and begins buying up private radio. Rupert Murdoch helps.

27th July, 1982:

Brierley, Jones and Goodman meet in Auckland with two Japanese members of the Trilateral Commission to discuss integration of the New Zealand economy into the Pacific Rim economy. Trilateralists include: Takeshi Watanabe (Japanese Chairman of Trilateral Commission) and Daigo Miyado (Chairman Sanwa Bank).

The Japan/New Zealand Business Council would be established to co-ordinate policy with Goodman appointed as Chairman.

17th August, 1982:

Inauguration of restructured US Mafia Council – rulers include David Rockefeller, responsible for Banking; John McCloy; Redman Rockefeller and J.D. Rockefeller, who would run the Seven Sisters.

Second-tier Council includes:

*

Gerald Parsky – responsible for heroin and cocaine operations
*

William Simon – responsible for running the Presidency, Cabinet, etc
*

Katherine Graham – link to arms manufacturers
*

Zbigniew Brzezinski – link to National Security Council and CIA
*

George S. Franklin – link to FBI

Third-tier Council includes:

*

Zbigniew Brzezinski – Secretary
*

Gerald Parsky – Heroin Cocaine operations
*

William Colby – crack operations, assassinations
*

John N. Perkins – banking, laundering
*

Leonard Woodcock – labour, unions
*

Mitchell Sharp – banking
*

William Simon – presidency, Cabinet
*

Ernest C. Arbuckly – arms manufacturers
*

George W. Bull – Bilderberg and Council of Foreign Relations
*

Katherine Graham – arms manufacturers
*

Alden W. Clausen – World Bank, IMF
*

Willam T. Coleman – CIA
*

Archibald K. Davis – media, radio, television, and newspapers
*

George S. Franklin – FBI, and Trilateral Commission coordinator
*

J.D. Rockefeller – to “spy” on the 15 man council.

September, 1982:

Goodman now helps establish the Japan/New Zealand Council with the Bank of Tokyo and the Industrial Bank of Japan. Tokai Pulp Co. buys shareholding in NZFP, which also begins joint venture with Shell Oil.

Fletcher Challenge strengthens links with the Rockefeller organization by acquiring the Canadian operations of Crown Zellerbach, whose chairman is also director of Gulf Oil. Crown Zellerbach Corp. has direct connections to Rockefeller through directors Mumford, Hendrickson and Granville, to United California Bank through Roth and to the Bank of America through Chairman C.R. Dahl.

Meanwhile, Robert Jones Investments floated to extend operations of City Realties, Ilmond Properties, Chase Corp., etc. The Commerce Building in Auckland sold to Robert Jones Investments by Robert Jones Holdings for $950,000 when recently it was offered on the market for $200,000. A quick $750,000 for Jones. Robert Jones Investments was set up by Brierley, Jones and Hawkins.

8th December, 1982:

Mitchell Sharp heads top-level Mafia meeting in San Francisco. Others include Parsky, Perkins, Woodcock and C.R. Dahl – Chairman of Crown Zellermach.

Also present are – Brierley, Trotter, Fletcher and Seldon. Meeting to discuss Great South Basin exploitation strategy with:

*

first priority being monopolization of the economy
*

second priority to establish oil refineries and related industries
*

third to integrate New Zealand economy into Trilateral economy
*

fourth, to concentrate power back to the U.S. through the Seven Sisters, Chase Manhattan and Security Pacific National Bank

Fletcher Challenge will link New Zealand economy directly to the U.S. by merging with Canadian subsidiary of Crown Zellerbach with funds provided by Security Pacific National Bank and United Californian Bank.

Brierley, Fletcher, Trotter and Seldon will be New Zealand Ruling Council, headed by Brierley, who would take orders from Gerald Parsky.

Mid-1983:

Brierley’s Ariadne (Aust) takes control of Repco (NZ) through Repco (Aust), thereby taking control of key auto-related industry, helped by Borg Warner and Honeywell – which are closely associated with IEL through International Harvester, Continental Illinois Bank and the First National Bank of Chicago. Toyota and Nissan also help so that Brierley now largest distributor of auto and industrial parts, largest manufacturer of pistons, filters and engine bearings, as well as biggest supplier of forklifts, tractors and agricultural equipment.

Meantime, control is extended over the Great South Basin oil source with Hunt, after big losses resulting from trying to corner the world’s silver market, being forced to sell out some of his concession to Gulf Oil, which uses Brierley to set up a new company – Southern Petroleum – which takes a 14.5% interest. Hunt retains overall control with 45.5%, Petro-Corp has 40% and Chairman F. Orr, also a Director of Brierley – controlled Watties.

Brierley, through Goodman, takes control of TNL Group and its subsidiaries NZ Motor Bodies and L & M Mining, which has 15% interest in the Chatham Rise, right next to the Hunt concession.

Southern Petroleum set up by Brierley in New Zealand was spearheaded by the Seven Sisters’ companies with Gerald Parsky and William Colby initiators. Southern Petroleum to include 21% of the Great South Basin held by gulf and Mobil Oil. 90% of this stock held in Australia through IEL (ie Brierley’s).

11-12th May, 1983:

New Zealand Mafia meet in Cook Islands. Includes Brierley, Trotter, Fletcher, Jones, Hawkins, Goodman, Pappas, Judge, Renouf, and Fernyhough. New members include A. Gibbs, McConnell, H.Fletcher and O.Gunn. Japanese Trilateralists Takeshi Wataneve and Daigo Miyado discuss ’integration’ of New Zealand into the Pacific Rim economies.

A new political party would be established using Jones and financed by the New Zealand Mafia Council.

* Reason: Parsky and Colby wanted Muldoon out because he had ’welched’ on a deal to set up two US military deep-water submarine bases planned for Dusky Sound and Guards Bay in the South Island. Parsky, Brierley and Ray Cline hold a separate meeting to discuss the purchase of New Zealand politicians, including Lange, Douglas and Bolger.

Cline was ’consultant’ to the CIA’s Deak Bank, took orders from Colby, and was responsible for the 10 Australian politicians on the CIA’s payroll, including:

*

Bjelke Petersen
*

I. Sinclair
*

Keating
*

McMullen
*

M.Fraser
*

D. Anthony
*

K. Newman
*

J Carrick
*

B. Cowan
*

R. Connor

Cline outlines CIA plan to begin subliminal television advertising.

22nd June, 1983:

New Zealand politician J. Bolger meets Ray Cline in Sydney and agrees to join the organization for a monthly fee of $US20,000 to be paid into account number GA1282117 at Geneva branch of Credit Swiss.

20th July, 1983:

New Zealand politician R. Douglas meets Ray Cline in Wellington and agrees to join the organization for a monthly fee of $US10,000 to be paid into account number 3791686 at the Sydney Branch of the Deak Bank.

July 1983:

Parsky launches a new front company, Chase Corporation, with 25% of the stock being held through Security Pacific National Bank in Australia and 25% held in Hong Kong by Chase Manhattan. Brierley and Hawkins set up a ’back-door’ listing to cover up true-ownership.

August, 1983:

Muldoon imposes withholding tax on all offshore borrowing.

Chase Manhattan, United California Bank and Brierley begin new banking operation in New Zealand to take over the International Harvester Credit Co (NZ), Australasian Investment Company. Participants include Chase Manhattan’s Kuwait Asia Bank, D.F.C., Saudicorp (Brierley has 12% through Goodman) and United California, represented by National Insurance which is part of Equus Holdings.

Renouf sells 20% NZUC to Barclays and prepared for expanding of operations with Brierley.

Meantime, Murdoch and Brierley expand their close ties by each taking a piece of New Zealand Maritime Holdings and with the election imminent, divide up New Zealand media for takeover to increase Mafia control. NZ News buys Hawkes Bay News, Nelson Tribune, Timaru Herald, etc. Brierley increases holding in Hauraki Enterprises and other private radio stations. Brierley and Murdoch have majority stockholding in NZPA with 48.5%, while in the UK, Murdoch has large stockholding in Reuters.

The phony news becomes THE news.

Head of the Murdoch operation is Burnett, who is also on the board of Winstones – a Brierley company.

September, 1983:

With global heroin epidemic, Rockefeller expands operations to recycle profits.

New Zealand South British sets up the IDAPS computer bureau to establish international holding companies, dummy corporations, etc and to pursue aggressive global acquisition programme. IDAPS linked to satellite bureau in Australia, Far East, UK and the US, where the global network is completed through links with the Rockefeller organization computer network.

General Manager of the operation, George Wheller, previously director of the international operators of Firemen’s Fund (US), Chairman Du Bain, director of the United California Bank, and Vice-Chairman of Amex.

As part of the expanded laundry operation, Rockefeller associate Adnan Kashoggi establishes new Australian bank – Security Pacific National Bank (Aust). Brierley’s part of this operation is to buy up computer companies such as Andas, CID Distributors (NZ Apple computer franchise, etc).

Investment companies begin operations in Australia and New Zealand to assist recycle Mafia profits.

October 1983:

Brierley takes over NZFP through Watties, helped by newly- appointed chairman Papps. Papps also chairman of NZ Railways and presided over transport deregulation, the major beneficiaries of which include Watties and Freightways – Managing Director Pettigrew and Director Lang also both on the NZFP board with Papps.

Papps also responsible for the railways’ electrification programme with big contracts for Cory Wright & Slamon, whose directors include I.I McKay, also on the board of NZFP.

Late 1983:

AMAX (Social) gives Gulf Oil a share in the Martha Hill gold bonanza by selling 15% of its holdings to Briereley through Goodmans. Oil companies say that only $870 million worth of minerals in Martha Hill, while true figure is closer to $3 billion.

21st January, 1984:

Australian Mafia Council meets in Sydney. Includes:

*

Brierley
*

Seldon
*

Fletcher
*

Jones
*

Goodman
*

Hawkins
*

Papps
*

Packer
*

Bond
*

Japanese Trilaterist Daigo Miyado

New members include:

*

J. Elliott
*

L. Adler
*

Holme’s A’Court

Seldon outlines strategy of merging Australian economy with the Trilateralist economy through Europe and the US.

In Australia, the Mafia Council will monopolize the economy with company takeovers through the use of loans at less than 5%.

Holme’s A’Court’s company would be taken over using Security Pacific National Bank and Chase Manhattan Bank, with some of the stock being held in London.

Equiticorp will be launched using Hawkins, with 50% of the stock held by Security Pacific National Bank and Chase Manhattan in the US Equiticorp to registered in Hong Kong to cover up true ownership, and will use the same laundry as Chase Corporation – Hawkins will set up a maze of shell companies and dummy organizations to disguise operations.

Hawkins previously associated with Kashoggi when Corporate Secretary of Marac, and linked with Renouf through their stockholding in CBA Finance, which is a partner in Commercial Pacific Trust with United California Bank, Hawkins forms umbrella company with Chase Corpl, Jedi Investments and Teltherm and begins setting up a maze of cross holding companies. Brierley retains his connection through his Charter Corporation’s holding in Teltherm.

January 1984:

Brierley and Elliott begin moves to monopolize the food industry in Australasia by merging Goodman and the Elders Group, while Brierley sells 10% of Watties to the NZ Dairy Board – setting the stage for land takeover and establishment of the Corporate Farm.

February 1984:

New Zealand politician D. Lange meets Ray Cline in Wellington and agrees to go on the Mafia payroll for monthly fee of $UA40,000 paid into account number 5263161 at Commercial Pacific Trust, New Hebrides.

March 1984:

Muldoon knighted with GCMG for keeping the economy free of obstructions for easier takeover and exploitation.

24th May, 1984:

Four-man CIA team coordinated by Ray Cline arrive in New Zealand to begin installation of equipment for subliminal television advertising at five sites:

*

Waiatarua
*

Mt Erin
*

Kaukau
*

Sugarloaf
*

Obelisk

Sophisticated equipment can be installed within one kilometer of TV relay arrivals and all linked to one IDAPS computer bureau in Auckland.

Same equipment installed in:

*

Australia ,August 1985
*

Japan, September 1986
*

UK, February 1987
*

New York, 1987

Also, Amax geologists now estimate Martha Hill gold source could be worth up to $30 billion on strength of high gold/tonne ore assay.

17th July, 1984:

In New Zealand, subliminal advertising begins on Channel Two between 6pm and midnight – hours later extended to begin at noon. Subliminal messages prepared in the US by the CIA and with New Zealand election imminent, tell voters to support the Labour Party, the New Zealand Party and to buy Mafia company products.

New Zealand Party was formed to ensure that Muldoon would lose, as Big Business unhappy with controls over economy. Big campaign contributions from Brierley, the oil companies and the Business Round Table ensure a Labour victory.

Later, Lange agrees to repay the favor to Brierley by selling the Government holding in the Kariori Pulp Mill to Winstones. New Zealand taxpayer loses $100 million.

Government then becomes the arm of big business, using economic policies provided by the Business Round Table, implemented by Finance Minister Roger Douglas and the package being sold by David Lange, who also keeps up a noisy CIA directed ANZUS withdrawal campaign.

* Reason:

1)   ANZUS Treaty did not cover Mafia requirements over the Great South Basin discovery

2)   To identify any opposition or threats within New Zealand who align themselves with supposed Government policy, Lange increases the SIS budget and strengthens links with the CIA

Brookings Institute are the actual designers of the New Zealand Government economic policies provided by the Business Round Table (NZ Mafia front) and implanted by the Government.

Douglas devalues the dollar and deregulates interest rates, which means cheaper labour, cheaper capital assets and high mortgage rates, thereby implementing Big Business policy of driving farmers off the land, establishment of the corporate farm and eventually remove viability of small business sector, etc.

27th September, 1984:

New Zealand Mafia meets at new ’safe house’ registered under Fernyhough’s name, in Auckland. Those present include

*

Brierley
*

J. Fletcher
*

Trotter
*

Jones
*

Goodman
*

Gunn
*

Papps
*

Hawkins
*

Judge
*

Renouf
*

Fernyhough
*

Gibbs
*

McConnell

Daigo Miyado announces appointment of Trotter as International Vice President of the Trilateral Commission Pacific Basin Economic Council.

Brierley outlines strategy of privatization of the New Zealand Government and the establishment of the New Zealand Centre for Independent Studies which will be chaired by Gibbs, aided by Fernyhough and controlled by Cline, which will ’advise’ Treasury on privatization.

Parsky, Brierley and Seldon hold a separate meeting with Parsky, outlining plans for an expanded laundry operation which will coincide with the launch of ’Crack’ – a new addictive product developed by CIA chemists for the world market.

Equiticorp (Aust) will be launched with Adler as Manager and a new merchant bank using Elders, Goodman and Jarden.

IEI will merge with Armco Bank, which has 20 branches in South East Asia; Ariadne will acquire the Bank of Queensland, and Brierley Investments will form a cross-shareholding with NZI Corp to further increase control by their Mafia organization. Other plans include the laundering of funds directly to the New Zealand and Australian Governments and the establishment of key companies within the economies of New Zealand, Australia and Hong Kong.

The first key company will control the food industry in Australasia through merger of Elders, Goodmans, Allied Mills, Fielder Gillespie and Watties. Allied Mills will control 30% Goodmans, 30% Fielder, 20% Watties and will expand into Europe via acquisition of Rank, Hovis McDougall (UK). Allied Mills will be controlled through IEL.

26th October, 1984:

Trotter, Hawkins, Lange and Douglas meet in Wellington to implement Mafia plans to privatize the Government and to deregulate the banking system.

Late 1984:

As part of the IDAPS computer-controlled ’laundry’ operation, Trotter and Fletcher help establish the ’Pacific Investment Fund’ with Australian and New Zealand investments to be managed by Hong Kong and Shanghai Bank subsidiary, Wardley and the Japanese operation controlled by Tokyo Trust and Banking Company – owned by Sanwa Bank, Taiyo-Kobe Bank and Nomura Securities. All are members of the Rockefeller World Government organization.

18th July, 1985:

Australian Mafia meet in Sydney to discuss privatization of the Australian Government. Those present include:

*

Brierley
*

Trotter
*

Fletcher
*

Seldon
*

Goodman
*

Papps
*

Packer
*

Bond
*

Elliott
*

Adler
*

Japanese Trilateralist Daigo Miyado

Cline will set up Australian Centre for Independent Studies to ’advise’ the Treasurer on the takeover of the economy. Impala Pacific will be set up in Hong Kong through Ariadne with 60% of the company stock held by Chase Manhattan and Security Pacific National Bank in Australia. In the UK, Tozer, Kemsly & Millbourn would be taken over using IEP, while in Australia, the Holme’s A’Court Bell Group would be used to merge with Hong Kong and Shanghai Bank, through Standard & Chartered Bank (Hong Kong), and Marae (NZ) Broadlands (Aust) would merge with NZI Corporation.

18th August, 1985:

Cline and 6-man CIA team begin installation of subliminal television equipment in Sydney, Brisbane and Perth.

8th November1985:

Parsky, Colby and J.D Rockefeller meet in New York to discuss their plans to assassinate McCloy and the Rockefellers and to take control of the Mafia organization.

Colby would organize a 8-man ’hit squad’ to be headed by Gordon Liddy who had worked for Colby in the 1960’s as a CIA contract killer, and was responsible for over 10 murders including:

*

17/8/61     – two members of the Gambino Mafia family in New York
*

24/11/63   – Officer Tippitt after the Kennedy assassination in Dallas
*

18/12/63   – witness to the Kennedy assassination in Dallas
*

19/4/65     – Politician in Chicago
*

27/7/65     – Politician in Washington
*

8/9/65       – Politician in Washington
*

27/11/66   – US ’independent’ cocaine importer, in Mexico
*

25/11/67   – ’Independent’ heroin importer, in Los Angeles
*

9/2/69       – Politician in Washington

28th November 1985:

Australian Mafia meet in Sydney – includes:

*

Trotter
*

Fletcher
*

Hawkins
*

Bond
*

Elliott
*

Adler
*

Holme’s A’Court

Discussed strategy for merger of Goodman, Allied Mills, Fielde Gillespie Davis, Watties and Elders with Chase Manhattan Bank taking 20%, Elders and IEL 10%, with stock being held through Chase-AMP Bank.

Elders would be used as major ’vehicle’ in the global liquor economy with Courage Brewery in the UK to be used as entry into Europe.

Strategy finalized to take over BHP, Australia’s largest company, using Holme’s A’Court, Brierley, Elliott and Hawkins.

In London, Chase Manhattan would takeover stockbrokers Simon & Coates who specialize in Australasia Mafia owned companies such as Fletcher Challenge, Brierley, NZI Corp, Elders, Bell Group and BHP. Chase Manhattan could then issue and buy stock to manipulate the Australasian economy by increasing price, paying no taxes, creating inflation, and enslaving the people through debt to Mafia controlled banks.

Parsky would oversee the ’launder’ of further loans to the NZ Government and would begin to channel ’loans’ through the Australian Treasury using captive politician Keating. Also NZ Government building would be sold to Jones and Australia Government buildings would be sold to Adler which would then be rented back to the respective Governments at inflated prices.

17th November 1986:

Brierley, Seldon, Packer, Bond, Elliott, Holmes, Court and Adler meet in Sydney. Also present is Rupert Murdoch to assist in Parsky strategy of media takeover in Australasia and the Pacific using Packer and Bond (TV and Radio) Brierley and Holmes A’Court (newspapers).

Murdoch takes orders from Brzezinski since his News Corp was taken over in 1982 by Chase Manhattan and Security Pacific National Bank.

At a separate meeting with Brierley, Seldon and Cline, Parsky outlines plan for ’key’ Media Australasian Holding company using the Bell Group which would be taken over by with Chase Manhattan holding 27.5% in London and the US. Another 10% of the stock would be held through Security Pacific National Bank (US).

8th February 1987:

US Mafia Council meet in Washington – including David Rockefeller, John McCloy, Brzezinski, Parsky, Simon, Katherine Graham, and George Franklin.

Brzezinski outlines plans to invade Iran using 75,000 strong mercenary army supported by US Air Force and Navy with starting date of 8th February, 1988. An integral part of the plan Saudi and Kuwaiti oil tankers would fly the US flag to provoke an Iranian attack so that US invasion of Iran would be ’justified’.

* Reason: The Seven Sisters wanted to exploit a secret oil field near Bandar Abbas discovered in 1976 with estimate 150 billion barrels and also a huge gold source at Neyshabur discovered in 1977.

The Iranian invasion would begin after the World economic system was collapsed by the Mafia controlled banks – target date 17th January 1988. Other countries on the takeover list include:

*

Mexico – for oil at Baisas
*

Nicaragua – for oil at Connto
*

Colombia – for gold at Popayan
*

South Korea – for gold at Chunchon
*

New Zealand – for oil in the Great South Basin.

(Obviously this part of the plan has yes to happen)

Holy cow Lloyd. You get the prize for longest post!!

I'd rather have posted a link but those I've found seem to have only parts of it.

..and an interesting one too.

I can post another if there is any appetite ?

Do you mean there's a post-1987 continuation?  It would be fascinating to see how this all morphed following the stock market crash.

Sure, I'll read it!

:-)

 

Ditto.

Hi Kate , I've not been able to find anything to indicate there is more, but I'll keep looking as I would be keen to do the same.
What I was referring to is a large extract which was not Nz centric, kind of interesting. Search gemstone files , should turn it up.
If I get more I'll post it, especially if it's on Nz.

 Lloyd - appetite isn’t a problem - digestion is.

Such terrible, frustrating stories create a lot of stinky farting inside me.

Who would be the best director to turn this into a movie?

..hmm let me think.

I also think it is flying dangerously close to being defamatory to a number of the individuals’ listed above who are still alive. Given that I know some of them and some of those events, what Lloyd has posted is nothing short of a pathetic, conspiracy theorists joke.

martyb - just Wiki it and you'll get the explanation.  It's not a "device" per se - just a "message" in one or two frames of a video segment.  It's been pretty much proven NOT to work anyway... so nothing to sweat about.  I believe they outlawed its use in the US - not sure about whether such legislation was ever enacted here.  Doubt it given it hasn't been proven effective anyway!

:-)  yes, I recall a bathing suit store chain in the US who had lighting which made you look tanned and mirrors that made you look skinnier.  :-)

Dig around and find out for yourself Marty. It may not have been happening at that time but the tech has been tested decades ago. Search away or , I'm not pointing to the aladins cave of all the documented info just yet.
Also assume you have cross researched the rest of the details or just skimmed over it until you found a piece to poke a stick at , and blown the lot off.
Personally it's the corruption & fraudulent behavior that I pay attention to researching. Just a tip

The world is all black & white eh Marty. I've given you lots of links & thoughts , you have offered little if anything back that shows initiative. If you can't find out yourself then that doesn't mean it isn't there. Don't expect it on a plate.

Go Gareth.

We punitively tax productive effort and savings for investment, we encourage spending on consumer crap, we encourage investment in non-productive assets and then we wonder why we're going down the gurgler.

It's nuts.

  At the heart of all this fluff is the belief by some that mankind is some sort of super species that can erradicate the dumb, the lazy and the criminal while also removing risk from life.

And so Socialism evolved around the idea that those who achieved wealth should hand it back to the govts to hand out to those who didn't make the grade.

All very good nice and warm until one sees the same govts buying power on the basis they will steal more from the successful and dish it out to the failures.

And then we have the discovery that under socialism, individual effort to succeed is crushed...leading to slower wealth creation and on into wealth destruction and Cuba!

Do not expect Socialists to accept that their system is a failure. They would rather destroy everything first. Cuba.

And so we come to Gareth's big Kahuna....all very nice on paper until the socialists get their fingers on the money machine..then watch as the rate of CGT rises and rises...and the capital departs the country. Nothing is more certain. Gareth would be the first to shift his loot from Cunliffe's fingers.

Gareth ,  I have a technical question about the mechanics of your proposal ( which I think is a really good idea in principle )  .

My new home has a GV of $750 000 , but I have a mortgage of $250 000 so my  "capital" (equity) is $500,000 .

For the purposes of taxation , is my asset is $500,000 or the full value of the house ?

Especially .given that ANZ has a loan  to me as an asset on its books of the $250,000 (Mortgage),.

Another question relates to taxing Plant and Equipment , much of the equipement in use in NZ has been depreciated significantly , and much of it has no "book " or carrying value . In reality however its often quite valuable if sold .

For tax purposes would you  value the machinery on its deprecaited value or its income generating value?

"For the purposes of taxation , is my asset is $500,000 or the full value of the house ?"

Its neither surely?  ie no profit = no tax to pay, and your home isnt taxed anyway.  When you sell an investment property then that could be complex...be interested in how you allow for having paid down the mortgage. Im sure its not that hard to do in a spreadsheet though, once you get the details of the law proposed will work. The idea is I would assume you will pay a % on the real/true profit....

So if you sold it for $765k....but paid down $5k in the mortgage then you will pay tax on $10k? minus the cost of the interest payments to the bank? as that is a legit expense? anything else (higher) would seem very punitive....which isnt what it should be about.

"Plant.....In reality however its often quite valuable if sold ."  and if its sold above its zero value I think you have to pay tax today on that profit? 

I know a family member looking to sell their business plant and its looking like scrap value only, it may even cost them to clear the site....so it isnt always the case its valuable even though the equipment is productive. 

NB Ive always considered the tax ppl pretty reasonable, its only when you abuse the system that they get shall we say, "anal"?

regards

 

 

It's $500k for Boatman. He's asking about Capital Tax, not CGT. And the ANZ pays capital tax on the other $250k ( the mortgage asset). That way the whole property gets annually taxed.

Bernard - how about ask Act and Fed. Farmers if they support these capital and gains taxation ideas that are being described. I doubt Brash will be allowed to support a CGT, even if he wants to, but you never know:

'Nicolson named as new ACT candidate'

http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10738021

Anyone know how many farmers/farms there are in NZ? About 80,000 or so, this might be a bit out of date, in more ways than one:

'Farming without subsidies in New Zealand'

http://newfarm.rodaleinstitute.org/features/0303/newzealand_subsidies.shtml

"Today New Zealand has around 80,000 farm holdings on 15.5 million hectares (38.3 million acres). The number of farms has held steady since subsidies were removed*; land area has fallen slightly as marginal land has been turned over to forestry or allowed to revert to native bush."

(*Never removed nil effective taxation on capital gains though. Am sure I saw an article on Int.co about banks not now lending against anticipated capital gain for farms. Seems this particular subsidy went further than just farming.)

So that's 200,000 PIs and about 80,000 farmers, say, who directly benefit from no effective property and land taxation. What % of us is that? Must be more than 5%? Another question, what is this combined groupings' effective 'representation ratio' when comparing the % of parliamentarians with similar interests? About 10:1, maybe 8:1?

Conflict of interest? Surely not. Turkeys don't vote for Christmas.

 

Cheers, Les.

www.nzmea.org.nz

Well not all PIs will be aiming for a capital gain as their only income, at least i hope not......farmers? but who cares?  Both groups were/are probably mostly National voters anyway, and National opposes this, so what has changed?  Has Donny B seen his support rocket? no....still a dismal 3%...so maybe if enough farmers and PIs switch, Act gets 5%...maybe 7%, still only Green % territory....who's being hurt? Labour? hardly IMHO....in fact though Ive never voted that far left, this time I dislike the idea of selling down SOE's and I like the CGT so much I might well.....what a thought.....after 30+ years....

Don N standing for Act does not surprise me, he's been an extremist kook for years...now he's just outed...

regards

 

"Some opponents say CGT will gut the housing market; others say house prices may skyrocket. Evidence suggests neither is true." From:

Let's dispel the myths and close tax loophole

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10738073 

If you like that article you might like those referred to here:

http://www.realeconomy.co.nz/144-capital_gains_tax_pros_and_con.aspx

Cheers, Les.

www.nzmea.org.nz

thanks for the info Les

After originally being opposed to CGT, having the view that the cons might outweigh the pros, upon further reading and consideration I now on balance think the pros outweigh the cons. Even before reading those articles I had changed my view, that rather than having an inflationary impact on the housing market, it would create both inflationary AND deflationary impacts, largely cancelling each other out - net result: little impact. 

24 hrs Countdown Begins...... to Labour's Tax Policy announcement.

It was time for a Gareth Morgan brain-dump in the form of a thought-bubble. Lotta words. Not very well thought through unfortunately. I'll get to that. The main item that stood out was his comment that the main asset or capital item for most people is the "family home".

The logistics of his proposal, on the face of it, would require every NZer to file an annual tax return, and "honestly" declare the value(s) of all the capital held by each person. Would that be at cost? or valuation? Cost would be good for the old-established land holders. No, it would be valuation GV QV. Good business for the valuers. There would be a dramatic upsurge in the formation of "family trusts" as rentiers and capitalists sought to spread the wealth across the family (assuming there is a threshhold) and out of their names. Shift their money off-shore to Mururoa, the Cook Islands, Antigua and other Carribean Tax Havens. How would the IRD cope with that?

In Australia the ATO and other Government agencies have immense and invasive and mature data matching computer systems that follow the money and the following article demonstrates the use they are making of it

http://www.theaustralian.com.au/national-affairs/computer-profiling-exposes-organised-crime-figures/story-fn59niix-1226093436561

Try again Gareth.

Gareth Morgan, as usual, is full of a lot of hot air. How do you establish the value of capital? The Govt. says my capital assets are worth $850,000. I say they are worth $650,000. Who's right? And who pays the bill to establish the 'value'? And you have to do that every year?

From a supposedly intelligent individual, that is one of the stupidest, totally impractical ideas I've ever come across.

Capital in land and buildings is already valued for the purposes of local government taxation.  

And then there is this register;

http://www.ppsr.govt.nz/cms/about-us 

for other security interests on various capital assets.

There's a lot more to capital than just land and buildings. And you only have to look at the jarring inconsistencies now in the GV between and among neighbouring properties in the same street to see what a hopelessly impractical idea this is.

Agree - that's why I linked to the PPSR register - as it's an "other than" land and buildings register (motor vehicles, plant and equipment, boats etc.)

Agree also on inconsistencies in GVs - and of course there is already a process by which one can request a review - and normally this sees a valuer to the property to do an individual valuation.

But can you imagine that being done, thousands of times every year all up and down the country? I can. And then how would you value intellectual property? It may not generate any income, but it could still be quite valuable. Who decides the correct value?

It would be a logistical nightmare to try and introduce and run.

I don't think IP would be considered capital for the purposes of the tax.  As of course, what we really want to achieve is to stimulate investment in capital that produces such IP.

Kate: Not sure the PPSR is a register of non-land assets. Looks like a register of registered loans and liabilites secured over assets, which doesnt account for a valuable asset that is free of any lien over it.

You are right.  But it would be probably quite realistic to say that most significant assets are captured by existing registers (motor vehicle, land, buildings, shares etc).  I believe that Gareth mentioned in his initial presentation that plant/machinery would be the exception - but of course all companies already maintain an asset register for the purposes of depreciation. 

Gareth, this is such excellent idea. 

Now can we start taxing your fleet of expensive motorcycles?  After all they are capital asset items and source of income (your travel books)

I've said this once on another post and I'm saying it again - who believes in Natural selection??  What kind of population is Gareth breeding?? It's all nice and fair in a politically correct kind of way but what is it doing in practice rewarding people's behaviour in the way he suggests?

It's all a big experiment in natural selection (or unnatural selection). Normally with a population of animals the weaker would sadly die, or at least not reproduce. Those nature programs are brutal.

Obviously we can't allow this to happen to humans- we aren't animals so we need to support those that are less fortunate. We don't want mothers with babies begging in the streets like you see in other countries. But unfortunately the consequences of rewarding people financially for having more children, and taking from the stronger or hard working or more intelligent to prop up the weaker or lazier or less intelligent has the unintended (and totally forseeable) consequences. It weakens the whole population. In an animal population it could bring the whole tribe down, and if the experiment carries on here it will do the same to us.

As a rule (I'm generalising here!) better off, more intelligent and educated people have less children, and generations are further apart than lower socioeco people. Follow those 2 lines of people a generation or two and you can see the problem. Soon you have (as GBH) says more than 50% of the population of the populace on a welfare junket and then Labour can't help but win every time. At that point the country is stuffed and passed the point of no return.

A tribe of monkeys sent all the strong clever monkeys out to gather food and provided unlimited food and protection to the weak and old and sick. The weak and sick were able to breed and the strong monkeys kept collecting food to feed them and their babies. The babies were sickly too and hung around their parents and soon there were grandchildren. The strong monkeys were having trouble collecting enough food now and couldn't stop working long enough to have their own babies. Sad story- eventually they all starved.

Whether there is CGT or not is not the point. If we do that extra tax will soon be swallowed up. You can't keep increasing taxes forever. You need to decrease the expense side side of the equation rather than increase the income side. If we want to financially incentivise people to behave in a certain way then incentivise them in a way that will help solve the problem. More money for more kids is not a good idea.

I am sick of the media portraying rich people as not paying their share. If you look at what they pay as a % of their income the percentage is higher than the poor pay. (The poorest don't pay anything, they are paid) If you look in dollar terms what the rich pay it is more in dollar terms. In what way are they not paying their fair share? When the top tax rate was decreased the media portrayed it as the rich people being given lots of money when in fact it is really they are just being allowed to keep more of their own money.

LAJ - re-read the Big Kahuna proposal - which addresses both the tax and welfare side of the ledger.

A GMI is, in my opinion, the only proposal for welfare reform which I've seen so far that takes away the present day perverse incentive which results in inter-generational welfare. 

For example, if a 15 year old realises that he/she is going to get "x" amount in a GMI (guaranteed minimum income) when he/she turns 18 - and no more, regardless of whether he/she has children or not, and no less, regardless of whether he/she has a job or not  .... there is every incentive for those youth to stay in school, study hard and use birth control to ensure you don't have any non-GMI earning dependants when you turn 18.

Similarly, this GMI for the existing worker equates to that amount of earnings tax free.  So, for example, say there is a flat tax rate of 25% on income - if the GMI were set at $10,000pa - it would mean for the existing worker, they pay no tax on the first $40,000 in income.

It gets rid of all means testing of benefits (no more WINZ).   Put simply, a flat rate universal benefit and a flat rate universal tax on income.

To make such an idea revenue neutral for the government - something else needs to be taxed - and hence GM's proposal of a comprehensive capital tax.

 

 

 

How does that incentivise anyone to do anything productive with their money? How will he stop all the capital going overseas? Is he planning to stop everyone taking their money out of the country like in South Africa? Why would anyone invest in anything in NZ or does he want everyone to spend everything they earn and save nothing to get more GST? I guess he would successfully kill off all rentals which rather seems to be his raison-d'etre, leaving government as the only landlord. Seems a crazy idea to me.

I don't agree that tax should be there to redistribute wealth to that degree.  It is a sharing of expenses incurred by the country, and the rich do pay way more already (the very poorest contribute nothing). It is also a backstop for the desperate but personally I prefer to give my support to people outside of new Zealand who do live in real poverty with absolutely no way of bettering themselves.  I really resent able bodied people in NZ  being bailed out. For the cost of supporting 1 person in NZ how many people in a third world country could you support, and they would be way more grateful.  His plan says just because you live in NZ the world owes you a living.  No wonder the boat people are dying to get here.

LAJ, your iniital post was more about welfare - and so I was addressing the present perverse incentives of the welfare side of the ledger. 

But, the point about a CCT - the big ticket items (capital in land and buildings) can't go offshore - so capital flight is always an issue but not for the majority the asset base which would be taxed.

Also bear in mind that income tax would be lowered - GMs proposal being a flat tax - which means our high income earners would signficantly benefit by lower personal income tax (PAYE) - not to mention the first $40K of income being effectively tax free arising from the GMI.  This should be a signficant incentive for highly paid professionals such as doctors, engineers, IT developers,...  to find working in NZ more attractive.

Presently personal income tax makes up by far the largest proportion: 39% of all government revenue, with consumption tax (GST) being the next highest at 24%.  Company (corporate) tax is well behind in third place at only 15% of the overall government revenue. 

Whether a comprehensive capital tax would "kill" the rental market - not if the capital invested is the most productive use of that capital.  In other words, if the capital invested produces a good profit, there would be no reason to redeploy it elsewhere.

 

    

 

Obviously capital in the form of buildings and land can't go offshore immediately but new capital won't be invested in buildings so they will deteriorate. (Maybe Chinese investors would be happy to invest in them as they are happy to take next to no return.)

The lower tax rates for PAYE payers is a plus for them but doesn't encourage investment.  (or as Gareth puts it "The biggest suckers in the tax system are PAYE earners. Idiots." eg doctors, engineers, IT developers). (Note his word not mine, I don't agree with him).

Corporate tax might only be 15% of the total tax take but they pay the people who pay PAYE. Most corporations have a required rate of return for their business.  Increasing tax reduces the return on their capital so they'll either put their prices up or refuse to invest their capital in that business if they have a better alternative.

Rentals- The point is capital invested would not provide a good profit under his scheme unless rents rise dramatically. Investors buy rentals to provide them with an inflation linked income and capital as there isn't really an alternative in NZ.  How else do you provide a retirement income that is stable and isn't eroded by inflation?  The price an invester will pay for a rental is the NPV of the future income and expenses.  If expenses go up( eg tax) either rent goes up or the investment is no longer profitable and they won't buy it.

Whatever you tinker with has an effect that eventually works its way down to the bottom paying for it in higher prices, maybe not immediately, but eventually.

I live in Christchurch, and have well over $1m of payments due from EQC for rentals destroyed  in the earthquake.  I have to choose whether to rebuild rentals or take the money and invest elsewhere.  If I do that's 12 less homes available to rent in the eastern suburbs. I know of other landlords in the same situation.  A lot of the homes destroyed are rentals in the badly hit areas. With the proposed tax changes what was profitable before is no longer a sensible investment unless rents rise.  If these tax changes take place a lot of capital will leave the area as the insurance companies free up all that capital. Who will pay for the replacements?

 

 

 

 

Your capital, LAJ, will behave rationally. As your post indicates, it already sees that property is not an automatic, or even rational, choice any longer. So it will seek a better return. That may be overseas, lowering our exchange rate as it exits. That, inturn will benefit manufacturing  exporter; providing employment opportunities, and may provide your capital with an alternative to staying offshore. The only thing that is certain, is that your capital is in a state of flux, as you comments indicate, and property is not a place you are likely to put it. You would, I'd suggest, if the buy-in price was lower, and hence the rents higher in relative terms.

So you are saying it is a good thing for the economy if capital leaves NZ ? Well that appeases my conscience then. So much for rebuilding Christchurch.

House prices still seem to be holding though don't they, despite extra taxes, and all the doom and gloom. They would have to decrease by a considerable amount to make it attractive to buy a rental now so you guys have done your job! Unfortunately most tenants don't have the deposit, income or sometimes even the desire to snap up the bargains even  if they do fall so I doubt they will thank you.  The taxpayer will have to pay to provide extra accommodation as private landlords slowly exit and no new ones take over.  As landlords have been subsidising rents it will cost the government more to provide the service or they will have to charge tenants more.    

The intention behind the Big Kahuna idea is proving in this exchange to work.  NA is right - you will do the rational thing with your capital, and indeed what you're thinking LAJ (i.e. that at current house price levels, reinvesting that capital in rental property just doesn't make sense). 

Unfortunately for all of us who own residential real estate, we have to accept that this is true, not only for those who might want to make a return on housing as a business, but also (and more importantly), these prices don't make sense for first home buyers. 

My hope is that you will redeploy your capital in a different business sector - and now is the time to begin thinking laterally.  There are many small business advisory services and I believe plenty of opportunities in NZ. 

Best wishes, LAJ with that new direction - it is a very good time to have liquid assets, and hence choice.

 

The rational thing wrt the big kahuna is to take my capital to Australia and buy a hugely expensive family home which won't be taxed on capital gain. Investing all your capital in a start up business or small business is too risky and with the rules constantly changing you'd be mad to.  Especially now with the difficulty getting insurance, the risks that the earthquake has highlighted and the real danger of another huge disaster hitting somewhere else in NZ any time soon, NZ is not looking like a rational place to have money unfortunately.

But Australian house prices are overpriced today as well - so plenty of risk of losing money on that idea.  And besides, it doesn't earn you an income - AND realestate is an illiquid asset.

You shouldn't invest "all your capital" in any one thing - whether it be realestate or plant/machinery or stocks/bonds. 

Think about diversifying, think productive assets, think investment that makes sense in a resource constrained world.

Frankly, with food prices inflating at the rate they are buying a ton of baked beans might well be the best return on investment going.  Or buy a plot of land and plant a forest full of nut trees.   Or land with a fast flowing creek and install a minihydro scheme.  You just need to start thinking about a tomorrow that differs from today/yesterday.

There's life beyond realestate!!!!

 

 

 

To modern economists everything looks like a money problem.

 

The proposal includes taxing non-producing assets.  Like the family home, or car, or dirt.  Anything an economist can define in monetary terms or place a dollar value on.  I can dollar value it, therefore it is wealth and if it is wealth is should be taxed.  It's hard to see where this wonky thinking ends, why stop at dirt, why not the dog - she cost money to buy.  Why not tax your children, they have long term economic value and are therefore a store of wealth.  The only missing link right now is that children have no direct monetary valuation.

 

A major justification for such a proposal comes from the various asset bubbles that have sucked up all productive capital from the economy.  Because of these asset bubbles people make an income from buying and selling the same non productive asset over and over again.

 

But there are two sides to this asset bubble phenomenon, something causes bubbles and the bubbles themselves.  Mr Morgan appears to see bubble and conclude the thing to be done is stamp them out.  They dress it up in terms like fair and equitable, but essentially the way to stop the bubble is to 'close the loophole' or stamp it out.  One could surmise from this that economists answer to a recurring forest fire might be to stamp them out again and again and again rather than shutting off the flame thrower they setup that keeps making them.

 

This is where it gets most interesting.  I propose we accept the idea that there is some actual cause to various non productive assets blowing up in price and attracting all kinds of punters with their capital, even those who don't even live here.  I propose the best course of action is to turn the problem off at the source.  However, the source is founded in the economic theory practiced for the last 100 years.  We live in a monetary world of our own making.  Mr Morgan and his generation of colleagues made the system they way ti is today.

 

We could argue over the root cause of these asset bubbles.  A lack of gold or other standard for fiat currency, governments who like to print more money than they should or other things like floating exchange rates or wonky tax law.  The common point to all these systems is they were created by the same folk who now moot the idea the solution to the problems in the systems they created lie in taxing non productive assets.

 

Think about it, the problems will all be solved by taxing dirt and dogs.

 

Unless the dog was free.

 

How likely does all that sound?

dont all the countries that have cgt also subsidies there farmers

Doesn't the one OECD country - NZ - that doesn't have a CGT also subsidise it's farmers, err, by not having a CGT?

Do you think it isn't so?

dont all the countries that have cgt also subsidise there farmers

We could probably talk to we are blue in the face about what is good for NZ and what taxes would be needed to rebalance the economy away from investments that create debt.

But Key and English have made it clear it doesn't matter what is good for NZ, all that matters to them is whether or not they might lose a few votes.

It's not very well written, and you've also got to run it through Morgans 'vested interest' filter.

He obviously has some form of heart, and conscience.

So far so good.

I went to a lecture last night, however, which suggested there's a bigger kahuna.

One I mention here from time to time.

A CGT will help address that issue, but not enough. We need a total overhaul of the way we trade, we need a drastic reduction of out physical consumption, and a curtailment of population growth.

That needs a fiscal system that can survive without growth, and Morgan is alle same everyone else in that regard.

Wasting time.

Is that the same poll that says Don will get well over 5% in the election?

There went one of the buzz-words.

"Fair".

Goes with

"Growth".

"Of course we offfer policies that are 'fair', and we offer - nay, we promise - growth. Strooooooooooooooooooong growth".

And they vote us in. Brilliant. My dad might just have been right - he used to say that most of the people are actually below average.....  You'd have to be to swallow the garbage.

 

So why would I bother being a landlord? Last I looked my $350,000 rental property returns revenue of $15600 P/A if rented for a full year. Interest, rates, maintenance etc come to around $25000. That's $9400 a year I put into the property so that the 'poor tenant' has a nice place to lay their head. That $25000 is an interest only not a P & I loan as well, so I'm not paying off my loan and benefiting that way. I can't afford to, I'm too busy subsidising my tenants life style as they don't want to commit to buying a house they’d rather spend their money on cigarettes and alcohol, smash my windows and do burnouts on my lawn. I'd love it even if they paid the rent every week, but I only get it when they feel like it... For some reason the rights I have as a landlord amounts to stuff all as I can't seem to get them evicted. Added to that I purchased the property for $420,000 so I've made a loss of $70,000. Do I get a tax credit for that loss I wonder? But hang on; the government can only value the house at what it's worth now so there for in 5 years time when I sell it for $370,000 (less lawyer and agent fees) I then get to pay CGT on my "capital gains" of $20,000 which is actually a "capital loss" of $50,000... What a great investment aye. I love spending my evenings and weekends chasing around after my tenants. I also love spending my nights awake stressing about tomorrow. I also love the fact I get taxed at a higher rate than the poor guy that was spewing on my front lawn last weekend. I love the fact I have to pay full price for my health care when the family down the road with their 5 kids sit on the porch smoking 2 packs a day and get their health care subsidised by me, oh but hang on their 'welfare' payments are also paid by me aren't they. So they're getting their rent for free, health care for free, alcohol for free, smokes for free... That's a lot for free... I'm so glad I worked hard all my life putting in those 60 - 80 hour weeks to get ahead. Please Labour if I vote for you will you Tax me more, I think you guys need a pay rise, I'm happy to subsidise that too...

So, why did you bother becoming a landlord in the first place?

 

 Trexjr....Your problems started when you paid $350ooo for the rental property .You paid too much.

Sorry i re read you poat and you pais $420k.wow ..way to much.I bet if it wasnt for WFF and social welfare payments you might struggle to get your $15k rental as well.

Maybe we could all cut and paste your story whenever Olly and his ilk rave on how great property is and why we all should invest in it...

MATE YA CAN'T LOSE WITH PROPERTY!!!

Rotflmao.

Stop stressing trexjr, climate change is going to kill you off anyway.