Opinion: Neville Bennett thinks the seeds of future youth alienation have already been sown in New Zealand

Opinion: Neville Bennett thinks the seeds of future youth alienation have already been sown in New Zealand

By Neville Bennett

Many people are bewildered by the anarchic, destructive riots wracking England. But it should not be a surprise as many societies have also been affected by protest.

Admittedly the focus has sometimes been political, where dissidents aim at regime change, but there has been a common theme in protests against austerity, inflated prices, and severe unemployment.

My focus is on the 'lost generation' in the OECD - and that includes New Zealand.

At present about 20% of youth (15-24 year olds) in the OECD are unemployed, and in some societies it is higher (40% in Spain). Many of these are at risk of never getting a job because their joblessness has 'scarred' them, and they progressively lose skills and motivation.

They also socialise with other unemployed and create a sub-culture of anger against state and society which has consigned them to the scrap heap.

Many of the lost generation feel they have been excluded from society, have no stake in the future and nothing to lose. This was not my experience.

My generation was prized by the state, our parents got child allowances; the state provided free health, dental and education. For the academically able, it was easy to get tertiary qualifications and a career. My school friends who did not go to university seemed to end up better off than I was.

While income was more equally distributed in those days, I do not want to argue here that the problem is just economic. I am really talking about 'hope' and inclusion.

My generation could aim to do almost any job they had reasonable ability for. Our generation could get good work, get married and buy a house, and a man’s wage could support a family.

The ‘bread-winning' wage has disappeared and now men and women work for 'single' rates and cannot get ahead on those.

Hope is in shorter supply now.

People might have a fantasy hope of being rich, expressed in buying Lotto, but we had realistic hope, a realistic path to achieve attainable goals.

Conditions have deteriorated.

That is a terrible thing to write as we are conditioned to worship the idea of progress.

But the state does less for young people, communities have withered. (Refer to the book 'Bowling Alone' and how politicians have promoted material self interest. See also Tony Judt's 'Ill fares the Land'.)

Sport can provide some metaphors for what I am saying. I recall visiting Lincoln in the UK after many years in New Zealand. I saw police escorting visiting football fans from Bus Park to the ground. I could not believe it: as a youth I had been to places like Sheffield and Nottingham in Lincoln City colours and never had met hostility. We were never hostile to fans of other clubs. But violence has reached even the sleepy town of Lincoln. It is worse in cities where from London to Auckland kids carry knives.

Bronwyn Hayward, a kiwi academic who worked in the UK, speaks of youth-saturated communities engaging in violent scuffles in turf wars.

"The youth are physically constrained and scared to move around. They are kept penned into their home territory, with outbreaks of knife fights when they step out of their postcode area, which can be sometimes be just a couple of blocks”.

Hayward confirms my analysis that “the unruly generation is the first in England to experience living conditions that had deteriorated since its parents and grandparents grew up”. She adds that soaring youth unemployment had coincided with budget cuts to education and training programs which had spiraled youth culture into disarray.

I would add that youth in London thought the Olympics would bring jobs, there are none for them. Why can Britain spend billions on war in Asia and on Olympics but not create lots of apprenticeships?

A second sporting metaphor about the exclusion of youth concerns New Zealand.

I recall an earlier Rugby World Cup in New Zealand when I gave my teenage son a trifling sum with which he could go to Lancaster Park (which I will always call it) and stand on the terrace with his mates and have a pie and drink. Terraces have disappeared. How many youth can afford World Cup tickets and shirts today?

Bronwyn Hayward says that youth unemployment and "rising tension in young people was prevalent in New Zealand". The unemployment rate for 15-19 year olds was 27% in New Zealand compared to Britain’s 20%. "… the problems are just as bad in NZ but the one significant difference between here and Britain is the concentration of young people in cities.”

She does not expect rioting here but notes NZ has the world’s highest rate of youth suicide.

I checked the Department of Labour’s reports which states that youth (15-24) have an unemployment rate of 17.4% but had been 30% for Maori.

The Department reports a NEET rate (Not in Employment, Education or Training) in youth of 9.8%.

I explored this concept further because these are often 'dropouts' and found some British research on why 18-year old NEETs were not finding employment. Their reasons were (in descending order):

- Lack of experience makes getting a job unlikely (27%)
- not qualified for available jobs (25%)
- Need to work flexible hours (20%) and so on
- with 11% having no reason.

This is not my field, but I think these NEETs are going to be very hard to fit into a workforce.

Some years ago I argued that New Zealand’s best chance of dealing with its looming demographic ageing crisis was to ensure that the youth of today were highly educated and trained in order to maximise their future incomes.

This is necessary as we do not have a contributory superannuation scheme for current baby-boomers who are now starting to retire in large numbers.

Eventually, the ratio of working/retired people will undermine the scheme, despite the Superannuation Fund.

There is uncertainty when the system will become unsustainable as there are many variables including the retirement age; the size, income of the workforce; the effects of migration (many young people might migrate, for example, diminishing the workforce participation rate).

Unfortunately this generation seems to have it tougher than predecessors.

They pay highly for their education, and assume worrying levels of long-term debt. When students engage in casual work they encounter very low levels of pay, usually close to the minimum wage. Young people entering the workforce also start on minimum rates, and many remain on that level in large employment sectors like tourism, retail and services.

The immediate problem is that they are victims of the recession. Youth unemployment increased sharply in the 2007-2010 recession but the number of most adults employed actually increased.

I believe it disgraceful that so many children live in poverty and emerge from school with few qualifications. One symptom of our malaise is that many children go to school hungry, and are incapable of meeting their potential. But programs to fund free breakfasts do not endure.

Readers who wish to read a really good report on that state of our youth are warmly referred to a recent report from the NZ Institute.

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

* Neville Bennett was a long-time Senior Lecturer in History at the University of Canterbury, where he taught since 1971. His focus is economic history and markets. He is also a columnist for the NBR.
nevillebennett@clear.net.nz
www.bennetteconomics.com

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Why can Britain spend billions on war in Asia and on Olympics but not create lots of apprenticeships? 

Very well put.

how about America, spending trillions on wars and space missions that add very little to our scientific knowledge

Any answer to questions like that on this site with its narrow mind sets gets met with conspiracy call bombs.

Often when looking at a problem, if the solutions are documented and well known & accepted, yet seldom if ever implemented for the betterment of society, then you have to start to ask , WHY NOT!

Trouble with this analysis is that not all the rioters were down and outs if you check the background of those coming before the Courts.  Yes, of course there were the ferals, but they have always existed in any society- remember Clockwork Orange?

Opportunism only thrives when there's something to piggy-back on, Muzza.

Sure, the least able are first to fall off the back of the ute, those most likely to be able to climb out, are already out. Background, school, suburb, income, love.

All missing for those folk. And it has to get worse. You could try giving them cake, but it's been tried.

Anyone of you guys read the links ?

Have read those that relate to NZ. It is heartbreaking to lay witness to what is happening in NZ, and has been for so many years now. We continue to slip down the ranking of youth problems, and successive governments fail, seemingly deliberately to address the issue with any degree of serious effort.

http://nz.news.yahoo.com/a/-/top-stories/986976/nz-youth-oecds-most-disadvantaged/

  • We have families in NZ, which is a giant farm, with social welfare systems in place who are starving.
  • We have kids turning up abused or dead on a daily basis
  • We have suicide & pregnancy rates in our youth which are the highest in the world
  • We have government stealing from the public via illegally claimed & perks & accepted gifts
  • We government issuing further power to ever growing departments to snoop into peoples lives
  • We have politicians who are not leading by example, and actively selling out this country
  • We have politicians propping up those who have money (SCF etc) and ignoring or actively attacking those who are most vulnerable
  • We have actively racist divisive policy, aimed at splitting society
  • We have family court systems designed to split families up....

Where are the leaders going to come from, those who have the empathy and understanding to help our country? There is no way they are coming from the current crop of politicians regardless of their age, because that is not how the system works. Any person who has what it takes to relate to all kiwis regardless of gender, race etc will have to come from somewhere out of the box!

Where did the pride go NZ, or the caring for your fellow Kiwi's? Oh that's right you handed it over to a bunch of crooks, and now look what we have.

If you are not going to stand up , then its not going to improve!

Thanks Neville.  A good article.  I get so angry and sad when I look at the mess that we left our children.  Student loans, diminishing work prospects, unaffordable housing, a society where the wealth gap seems to have widened significantly and seems to be accelerating alarmingly.  It feels as if a handful of very  wealthy people are calling all the shots and whatever political party is in power, the situation is turned to do their bidding.  Among the may things that are wrong, couple of related thoughts.

It seems paradoxical that the digital revolution has done nothing to help the problems discussed.  Are the required eccomic outputs are being achieved with less people through tecnology and globalisation.  The money saved is acruing in the pockets of a handful of people at the top while those unemployed miss out.  As we boomers retire this may be relieved somewhat.  But then the poor souls will have to support us.  If we have these levels of unemployment should the working week be reduced and the wealth gap closed.

China's  managed currency is hovering up jobs all arround the world,  This certainly is not helping.  It is time for the Americans to say, you either adjust your currency settings or we will never be able to repay our debt?  Either that or we end up in a tarriff war.

There is more than just a lot of political and ecconomic problems.  I believe that the ethics, morals and values of the whole of western society have suffered very badly in our lifetime.  This is not serving us well, particularly the younger generations.  Most societies that survive have evolved a religious element to their culture.  This is reinforced through stories, parables, preaching and various forms of teaching.  In our lifetime this has been largley lost in our secular society and the flight from smaller stable comunities.  The social teaching has been replaced by film, computer games and TV.  When you consider the content of these media, you can see where our values are going.  As we all know, 30 second adds on TV work, even when we don't want to see them.  (why would advertizers waste millions otherwise)  Accordinly what is the affect of what is willingly watched and played for hours on end.

Good post Chris and with some observations which if you research your thoughts at a deeper level you will likely begin to uncover some rather unsavoury home truths about where the real power elite lie, and the the extent of the deception that has been, and is currently being played out in broad daylight.

I have said it before that it is firmly on the shoulders of Generation X to take control of the situation and begin the process of rebalancing the systems for the greater good. I am not talking about lip service such as that of JK or BE or other prostitute politicians, but the desire by real human beings who care about all people, in this case specifically NZ.

Generation X have the unique benefit to be the only age bracket, perhaps with a few older gen y's to have live in the age of pre digital, as well as in the digital era, this in my opinion gives us a distinct advantage in terms of thought process and an ability to relate to the world before the digital entrapment and cult of celebrity took hold. It will not be an easy task, and it will require the help of capable people from all generations, because there are some BB's who understand that there is big real problems, and some younger ones also understand.

I passionately believe that this is how is will have to be, because the power brokers who monopolise the spectrum of all systems which control and influence our daily lives are not going to step aside, so it will have to be taken from them. There is an apetite for genuine change offered by people that care, it's going to happen, just be ready to get involved when the time comes, which will be sooner than you may think!

I am not sure I want to be involved Lloyd, but the principle that applies here is it will happen whether or not I want it to. But oh no, lets just put our heads in the sand and pretend the world can keep on trucking along as it has for the last 40 years.

 "Most societies that survive have evolved a religious element to their culture.  This is reinforced through stories, parables, preaching and various forms of teaching.".....!
Are you for real Chris-M....are you claiming there is a link between the problems of the modern world and the decline in religion?
If Neville is that worried about the provision of employment for young people and the incomes they can earn..why doesn't he resign from his jobs...he surely has enough to live on and a younger person trying to raise a family would have a job to go to...no!
If he is that concerned about the cost of education ending up as student debts then let him take a salary cut and/or maybe pressure all the ohter 'academics' to slash their demands for higher pay...what is he paid now? Whatever it is, it comes from the students by way of debt.

I don't really see an easy way out. For several generations we have bred a dependency mentality. Families with multiple generations knowing nothing but state handouts and violent parents. These same families have 4+ children, increasing the problem with each generation, every one brought up indoctrinated with the belief they can never succeed. Meanwhile the financial burden of this ever growing disaster is bourne by an increasingly pressured tax payer, who can no longer afford children of their own because their taxes pay for the children of those that choose to mindlessly breed without consideratrion of their own children's welfare. In many Asian countries where dole handouts are not the norm, families support each other, assist each other in entrepreneurialism, and value education above all else. The 'western' democracies could learn a lot from this. It is time for a change before it is too late.

Tim there is no easy way out that is right, and the sooner that people (if they even give a toss) realise this, and actively get involved instead of handing over all responsibility to corrupted politicians, then nothing will change.

Believing that those who created the problems can provide the solution is madness beyond belief!

This dependence mentality is wider than what you describe.  There is also the dependence of bankers, for example, on public money to pay for their bad decisions. 

Nah that's different AR...definitely not dependence...thieving would be a more accurate term...gotta keep the bonuses and bloated salaries as you know.

So the executive in the USA is now made up of a "Super Congress" with Barry + 12. There is no longer need for congress, as the country & its systems  are now under the control of this Committee of 13.

Seems congress was getting in the way of scheduling....Lets see if they hand the power back...

http://finance.fortune.cnn.com/2011/08/10/congress-super-committee-pain-punishment-and-payoff/

 "....something is fundamentally flawed..." you got that right Parky...the flaw can be found in the greed and envy and imprudent financial behaviour of too many wanting everything and wanting it NOW.

Instead of pushing your social credit polly controlled credit printer machine as the answer, why don't you turn your attention to encouraging the peasants to stay away from the banks.

You took out a mortgage Parky and in so doing you added to the influence and parasitic power of the banks. You could have opted to rent and save instead...but no...you wanted that property NOW.

The solution is staring you in the face but it is not a solution that leads to a minority of socialists holding control over an entire country by being able to dictate who receives what in the amount of credit.

The interest rate game is supposed to act as a control valve to temper the enthusiam for credit...but unfortunately due to useless govt...and shocking RBNZ behaviour...credit has been kept cheap. The control has been removed. So the only thing for the people to do is to stay away from the thieving bloody banks. Nobody can force you to borrow money Parky.

"Your blind ideology of only blaming the borrower in a system that is debt based by force and not questioning the controlling crony private bankers at the core is just pathetic."....

Temper temper Parky...hit a nerve did I...and the blind ideology is not something you would have is it Parky!...

Far as I am concerned the banks are parasitic.

If people reduced their demand for easy credit which they use to chase property, which contributes to the rise in property prices..then demand for property would decline and prices as well and the people who saved up would find what they needed at a lower price.

Rubbish, if it wasn't for the land supply racket, ANYONE could afford a home. Plenty of cities in the USA had the same "easy credit" as California did, but their house prices stayed attached to a big hook in the ground.

I share Mr Parker's disillusion with Wolly's decline of mental faculties.

He asks, all offended, above, whether Chris "honestly believes" that our problems derive at all from a decline in religious belief. Well DUH, Wolly.

Have you heard of any books like "The Protestant Work Ethic and the Spirit of Capitalism", or "Individualism and Social Ethics: an Evangelical Syncretism"?

Or the academic papers by Professors like Stark, Iannocone, Barro, McCleary, and Guiso? Correlating religious belief with economic outcomes?

And if all that is too unpalatable for you, at least do yourself a huge favour and read a bit by the atheist Charles Murray:

On the undermining of the traditional 2-parent family and social breakdown, READ:

Charles Murray: “The Underclass Revisited”

http://www.aei.org/publications/filter.all,pubID.14891/pub_detail.asp

Charles Murray: “The Advantages of Social Apartheid”

http://www.aei.org/publications/filter.all,pubID.22252/pub_detail.asp

Bear in mind that this guy has been researching and writing for 30 years. His tone has become increasingly mocking and cynical as he sees “the social establishment” in denial over the underlying causes of society’s problems. You could summarise it thus:

OK, if you won’t tackle “fatherlessness”, you are eventually gonna have to tackle crime.

OK, if you won’t tackle fatherlessness and you don’t like catching criminals, you will have an increasing crime problem, and eventually the voters will force you to do something about it.

OK, if you won’t tackle fatherlessness and you don’t like actually locking up the criminals that the voters are forcing you to catch, you will continue to have an increasing crime problem, and eventually the voters will force you to do something about it.

OK, if you won’t tackle fatherlessness, we will just have to have large numbers of people locked up in jail. The USA is merely ahead of the rest of the world on this measure.

And cut that BS about poverty and inequality. Look at the underlying statistics. The problem? Fatherlessness. End of story.

Here is a quote from Charles Murray:

“Throughout human history, a single woman with a small child has not been a viable economic unit. Not being a viable economic unit, neither have the single woman and child been a legitimate social unit. In small numbers, they must be a net drain on the community’s resources. In large numbers, they must destroy the community’s capacity to sustain itself. Mirabile dictu, communities everywhere have augmented the economic penalties of single parenthood with severe social stigma.”

Not a shred of "religion" about that analysis. In fact, it is a Darwinist analysis. Funny how Darwinism is "god" with secularists, until it actually confirms something religious people always thought.

Lay it on thick why don't you Phil. Lol.

Quite correct though, and the real shame is that the one party that might have given up hope in the furore we face have danced with the devil. Thanks for the anti smacking bill Bradford.

Actually Phil I think you could ponder a bit more on Wolly's point about participating in the Banks, as could Parky.

The core issue comes down to morals and ethics. When you know an action is fraudulent, then if you participate you become culpable. Sort of like an accessory to the fact in criminal terms, perhaps buying stolen property would be an excellent example.

Don't under estimate this, because the thinking behind the money and finance systems is criminal.

Iain is right in that the statis quo system monetary system that we live in is no answer.  

Wolly surely you can see that no amount of dial tweeking within our current system can provide anything but delaying the enevitable crash? 

Got a better idea?  Gold standard?

2 distortions in the free market, have played right into the hands of the finance sector.

Saying that “free markets have failed” because risk was underpriced in the credit default swaps market in 2007, is like saying the whole concept of powered flight has failed because Airbus has had problems with fly by wire systems.

I agree completely that the banking and finance system should be “handmaiden to industry”. It is completely wrong that, of the total profits made in an economy, the share made by the finance sector should have crept up, and up, and up over decades to reach and exceed 50% of the total.

Every time there are political distortions in an economy, there will be rent seekers looking to gain from it. I suggest that the finance industry is merely benefiting from decades of accumulated bad politics that penalise true industry. Abolishing corporate tax entirely would help – except it should not be abolished for the finance sector.

Undistributed profits SHOULD be the main source of finance for growth for an industry. Of course if the greedy government takes a third or more of this source of finance for growth, they are delivering the businessman into the hands of the finance sector, for money to pay for his added stock, debtors, etc.

By all means tax profits distributed as income, as high as you like. But taxing profits before distribution is the single worst, destructive, spite-motivated tax there is.

Another major cause of finance sector rent seeking, is urban growth constraint that drives up the price of urban land and forces anyone wanting to buy any land for home or business, to borrow a whole lot more money to do so.

Are you sure that housing has been left out of the CPI? I just looked up the measure on statistics New Zealand's website and it certainly looks like the basket does include housing. Changes in the cost of both purchasing housing and renting are detailed in the CPI June '11 report.

My generation was prized by the state, our parents got child allowances; (still do, ever heard of Working for Families?)the state provided free health, dental and education (still does). For the academically able, it was easy to get tertiary qualifications and a career (still is).My school friends who did not go to university seemed to end up better off than I was (same same).

Given that you are English, Neville, and were brought up in a foreign country, can you please explain to me what the narrative of your British generation has got to tell us about New Zealanders of the same age? I don’t see the connection.

I recall visiting Lincoln in the UK after many years in New Zealand. I saw police escorting visiting football fans from Bus Park to the ground. I could not believe it: as a youth I had been to places like Sheffield and Nottingham in Lincoln City colours and never had met hostility. We were never hostile to fans of other clubs. But violence has reached even the sleepy town of Lincoln.

Well that is England’s misfortune. But what has it got to do with New Zealand? Soccer hooliganism is a well know feature of British life. Surely you’re not going to try and interpret that with recourse to left-wing political dogmas and social theories, i.e., that soccer fans are so disenfranchised from British society at large and are so disadvantaged by its wealth inequalities, poverty and lack of opportunity, that they have no other recourse than to smash in the face of the opposing team’s fans? Oh please. By the way can you tell me when was the last time that Auckland’s rugby fans attacked Canterbury’s and went on a rampage through the streets of Christchurch? I’ll give you a clue. Try never. So really, what has British hooliganism got to teach us about life in New Zealand?  Very little I would suggest.

Hayward confirms my analysis that “the unruly generation is the first in England to experience living conditions that had deteriorated since its parents and grandparents grew up”.

That’s a very bold statement given that those generations went through one to two world wars and a great depression. Are you sure you want to stand by it?

My concern here is that the left and those who subscribed to its social theories are being apologists for criminal behaviour and imparting to it a social justice legitimacy that it does not deserve, nor does it have. I reject this approach as nothing less than appeasement to thugs and losers, and encouraging the sense of entitlement and a lack of accountability in society that has risen up in the West in recent times. The left have been told for years that their approach of misinterpreting and misunderstanding social events via the lens of left-wing social theory will only end in tears and we have seen plenty of those in England this week. I would invite the academic left to be part of the solution, and not continue to be part of the problem.

If these disturbances in England last week were genuine riots about social inequality in British society, then you would see the same population demographic that we saw on Arab streets in recent times. All age groups, male and female. And that is certainly not what I saw on the streets of England last week.

My concern now is that we may well see riots in New Zealand. (But I’m hoping not because South Auckland and England are very disconnected) But if we do it will not be as a protest against inequality. In fact far from it. It will be because it’s become fashionable. That’s something the left will never understand. 

 "But it wont happen because"...because Parky would rather it didn't...because Parky would rather see politicians in charge of the credit factory as if this would lead to a better world or whatever...and we know bloody well politicians are as trustworthy and 'upstanding' as bankers don't we.
You are this close to saying it Parky..go on boy let it out...."the people have the power to rip the parasitic bank from their lives if only they could control their own greed and envy, if only they could see that saving up to buy stuff is a better option...."

yup...that about sums it up DB.

David B, reckon you have a cheek writing such common sense as this, it's not goning to be taken kindly by many who like to chat to each other on this site.  Heard of Coventry, well you be sent there

Thanks Muzza. I actually quite like a bit of peace and quiet.

Anyhoo...

'Look out for the kids when you swing that axe, Mr Key'y' '

http://www.nzherald.co.nz/best-of-business-analysis/news/article.cfm?c_id=1501241&objectid=10744754

"At the time my (Fran O's) mother - and Key's - took charge of their families, jobs were plentiful. It was also not the norm for both parents to work, so there were also plenty of stay-at-home mums happy to earn some extra dollars by caring for other people's children.

If solo mothers are forced back to work please ensure after-school care is available so they can contribute safe in the knowledge that their children are being cared for.

Otherwise we simply embed the kinds of pervasive inequalities that have led to too many of Britain's youth being ostracised from society."

And for another broad perspective of what caused the UK riots:

'The competing arguments used to explain the riots'

http://www.bbc.co.uk/news/magazine-14483149

Whatever we might think are the prime causes, do we have them in NZ? Are they developing? If so what do we do about it? Is there just one single solution to what appears to be a reasonably complex problem? Or what? Or will we just use this issue to leverage our favoured ideologies and agendas?

And here's one for Parky to ponder over...

 "In the July edition of The Casey Report, guest contributor James Quinn discusses the very real challenges facing China, not the least of which is that in the latest reporting period, official Chinese inflation popped up to 6.4%. Even more concerning was a 14% rise in the price of food.

Scrambling to keep employment high while also keeping inflation low, the Chinese government is throwing all sorts of ingredients into the mix - building ghost cities, raising interest rates, stockpiling commodities, clamping down on dissent, hacking everyone - but in the end, the irrefutable laws of economics must prevail. And so the Chinese government will have to atone for the massive inflation it unleashed in 2008, and for the equally disruptive misallocations of capital that are the hallmark of command economies.

While the blowup in China will wreak havoc in world markets, including many commodities, a bright side for gold investors is that the country's rising inflation should help keep the wind in the sails of monetary metal. It's no coincidence that the World Gold Council's latest data show investment demand for gold in China more than doubling in the first quarter of this year"

http://www.marketoracle.co.uk/Article29858.html

See the thing is Parky.....China is what you claim would be good for NZ to be!....a place where the money supply is in the hands of the upstanding politicians you speak of...and yet here is the grand example of what social credit leads to....I wonder if you will understand!

I thought Parky supported "Austrian" economics. Am I mixing him up with someone else?

I think Austrian economics is the answer, not "social credit". Austrian economics and "free enterprise". Not "statist enterprise" with rent seekers hanging off the State all over the place and shutting competitors out. And "freedom to build" - not racketeering like "building and construction" is in China. That is not "free enterprise" at all.

Under truly free markets, you get housing affordability like they have in cities in Southern USA.

Great article from Brian Gaynor, highlighting how governments in the US, around the world, and most definitely here, are either too scared to cut spending, or are too scared to have tax levels appropriate  for how much they are spending.

Definitley a big problem in this country.

You can't have your cake and eat it, it has to be one or the other.

http://msn.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10744745

Fair go Ivan...it's grossly wrong that a teenager cannot have a BMW or a Merc, plus a new house by the age of 21...fancy thinking they are better off these days..look at the trouble they have to go through to use their cellphones and social media systems...

You must be one of those rich pricks what ought to hand over all your loot and feel good about it. I spose you're also taking food out the mouths of the children by taking a pension you don't need.

Annette King has no time for you Ivan!

You missed out the nasal-lolly-powder and razor-blades and rolled up 100 dollar-notes.

And the mind pacifying ecstasy. Table-spoons and cigarette-lighters.

And you missed out the right-of-passage bankruptcy for nineteen yo's on the delinquent  credit-card debt and massive blackberry-bills.

Blackberries...mmmmm...yummmy.

If "capitalism" had been allowed to do for "housing" what it has done for cellphones, those kids would own their own homes too, or be about to, or be looking to a short term future where that was possible; and their attitudes would be 100% different. Even Matt Ridley in "The Rational Optimist" points out that housing is the one area of socio economics MOST stuffed up by State meddling.

I betcha the cities of Southern USA where housing median multiples never went much over 3.0 at any time ever, will be the western world's most riot-free zones over the next 10 years.

Ivan old bean...you interpreted sarcasm as a personal attack....sorry about that...I will have to get better at it. Teachers who fail to recover during your 'holiday time' are usually dead soon after, or hospitalised never to teach again. Give it a go Ivan..plenty of vacancies.

The pension is not something I receive..not for some time...

I will continue to attack the socialist ideas that excuse govt theft of wealth from those who gain more than the average peasant is allowed to have in the socialists ideal world of sameness. The lesson in this culture is to do all you can to avoid being identified as a 'rich prick' least you cop it from the mob.

The welfare state has been around in NZ for 80 odd years one way or another as others have pointed out but look at where we are...the screaming headlines about wealth inequality and the list of awful things that are said to result from it....80 years Ivan.....perhaps there are things wrong with this 'welfare system' and the political game attached to it.

I wish you all the best and may the pension still be there when you reach 70!

For pete's sake Ivan I was not calling you a rich anything...read between the lines!

A wgtn train guard...you must travel a lot Ivan!...it was once a safe job but I can understand what you say..the late shifts must be awful.Don't they have CCTV on the units by now?

I retired years ago so you would be swapping work for retirement.

Some teachers are lucky Ivan. Most are not.

As a teacher for 37 years I can telll you this is a job where you walk on eggshells all day long. Over those 37 years student behaviour deteriorated significantly and in the low decile school where I taught it was commonplace to be called the C word on a daily basis.  I had a disciplinary role in my later years, no free periods at all and spent a lot of time in the classroom with teachers whose backs were against the wall. It was hell. When I quit to  manage a retirement village in Sydney it took me two years to recover from my time at the chalk face. I'm 60 and two of my colleagues have died in the past 10 months. There are a lot of very dedicated hardworking teachers out there and if there were no holidays I can tell you there would be few willing to teach. After all that time I still love kids.

Teachers reading this will appreciate your supportive comments.

Ivan, you are sadly out of order, I'd suggest we don't pay the teachers enough respect or enough remuneration.  You seem to be typical of this attitude/malaise

Youth unemployment in NZ:

'Youth unemployment leads to rioting attitude'

http://www.nzherald.co.nz/politics/news/article.cfm?c_id=280&objectid=10744703

This is David Farrar looking at the influence of abolishing the youth minimum wage. Some useful observations included.

Should an apprentice expect the same rate as a qualified and experienced tradesman?

Agree David B.

I think Neville should have a read of  the stories from the Tampa refugees in today's Dom.Post ( and probably The Press) . Very uplifting.

Problem is we are way too soft on these "discontented youth". Tell me how is it possible for unemployed youngsters in Dunedin for example to get payed a benifit for sitting on his/her backside doing nothing.? Roxbourgh resembles downtown Honiara over summer as they have to bring in fruit pickers from the Solamons, Silver fern farms and Alliance have to bring in workers from Samoa and Tonga to fill the chains, Dairy and Pig farmers having to bring in Phillipinos to man the farms, the military having to increase there advertising budget to try to get recruits.... WTF is going on!???

Granted these might not be glamourous or high paying jobs, but they are jobs and a chance to develop a work ethic and gain experience and have some sense of self worth. Im not sure how it works in the rest of NZ but down here its certainly not about lack of jobs. How hard can it be for winz to join the dots here??? 

HI Shags sheep, how did the UK trip go. WE have the same problem here  Islanders in the hort industry and Fillipino's in the dairy industry. Youth want to go straight to the top, Uni, debt and then a 100k a year job. Employers with rather employ immigrants with experience than a young man with none, and a big student loan.

Hi AJ. I regretfully inform you that it was not I sauntering around the UK(you might be referring to Casual Obsever?)Ive been diligently doing the winter chores on the ranch. Slightly aprehensively at the moment with regards the pending polar blast, which even sunny Hawkes Bay looks set to enjoy.

Id be interested to know what you think the answer is to the "discontented youth" issue. My obsevations are that country kids that are often helping in tailing pens and calf rearing sheds from young ages generally develop into good contributing citizens in whatever field they ultimately persue.Harder for city kids I guess but again us Gen X parents are too soft I recon. Too much namby pamby.

To me we have to be more proactive in not letting kids fall through the cracks firstly at school and subsequently developing a dependancy ethic. How can so many kids go through 10 odd years at school and come out unable to read or write? Why dont we draft out certain kids that arent academically gifted and stream them into more practical skills base learning that actually might be relevant to them and subsequently useful? Everyone has talent at something. And why oh why do we condone importation of foreign labour  to do jobs that we are essentially too lazy to do ourselves???

 As I get get older I know less and less.  Just had a south Afrikan couple in our cottage, civil engineer, got a job at a council no need to train a kiwi one. My friends boy's struggle much more than it appears girls are. My girls are motivated and love study, my friends boys are brought up on a culture of rugby, beer and fast cars. I think the first thing we should all do, is throw our Tv's out the window. Im afraid that it may be the state safety net thats caused alot of the problems, I mean whats the worst that can happen, dole, DPP,ACC, Sickness benefit. Who pays best, the State does. Went to a friends son's 21st, they all want to be bankers, I suspect they are a little late and will be sorely dissapointed. Thats why its sad that high asset values, stop youth from dreaming of farm ownership and so many sharemilking jobs have gone. Globalisation has wrecked havoc and it hasn't finished yet. As a sideline I see addias All black Jerseys are manuctured in China for $8.

Andrew - don't get too depressed, "Thats why its sad that high asset values, stop youth from dreaming of farm ownership and so many sharemilking jobs have gone."

Help is on the way, at sometime in the future, it's just a matter of time:

http://www.stuff.co.nz/national/politics/5425983/Labour-MP-stays-positive-about-CGT  

Gerry Eckhoff would be proud of em, I guess.

How about you, are you into this cgt thing? Or maybe a land tax?

Cheers, Les.

Is it as simple as Wolly suggests:

'The riots were mindless, but not without reason'

 http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=10744282 

"Yes, what we were watching was indeed mindless, and indefensible. But that does not account for the fact that there were many issues that sparked the fire.

British politicians have espoused neo-liberal dogma for the best part of 30 years. A dogma based on consumerism and selfish individualism over shared responsibility.

And Britain, after 30 years, is a society more divided than at any other time since World War II. The haves have grown in wealth while the have-nots have grown in number. ""

and:

"It is no irony that a country which has pursued consumerism and social nihilism has been blighted by people who - when it all goes wrong - believe in and respect nothing except consumer goods.

While the streets have been cleaned, the problems have only been swept under the carpet.

The menace, enmity and ennui will remain and if nothing is done to alleviate it, Britain must expect more to follow."

... and NZ same or similar, if we aren't careful, if we too continue suppressing open analysis of a similar cause set and simply keep sweeping the too hard stuff under the carpet.

Good effort by the way Neville.

But Les the only reason they were able to enter 'the age of consumption' was because of Asia being able to produce goods incredibly cheap, so even a sweep could afford a 42" telly and see how the other half lived and want a bit of the action.

Hmm, "the other half", are you sure it's a big as that? I thought more like only a few % - which appears to be very much part of the problem and those we are sweeping under the carpet. Anyway some nutter writes this in HOS today:

"Bill Gross is the world's most important fund manager. He runs Pimco, which is the world's biggest bond fund with US$1.3 trillion ($1.5 trillion) in assets.

He commented this week that the hollowing out of the United States' free-spending middle classes was at the heart of the problem. He pointed out that for several decades the engine room of the US consumer economy had been starved of income as high-paid manufacturing jobs were exported to lower-paid factories in China and technological innovation replaced workers with machines.

For 20 years, the middle classes had made up the gap by borrowing more and governments had also borrowed more in recent years to supplement their incomes.

Meanwhile, the extra profits made because of these lower labour costs were shuffled up to those on higher incomes and increasingly to an ageing group of capital owners. Increasingly, wealth and income is being concentrated in the hands of those who can't or won't spend it. This is starving the consumer economy of oxygen it needs to keep growing."

 http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10744940&ref=rss

But he's not the only nutter that gets it, read the artcle.

Cheers, Les.

Neville,

Great analysis - I have the greatest respect for you. Here is what you missed out.

Your generation could also buy a house for 2X median income, AND get mortgage interest deducted from your tax return.

In your generation's day, new subdivisions were regarded as a social good, and helping to provide a fair go for the young. Even if the young didn't buy new homes in fringe suburbs - and many actually did, "filter down" of housing meant that a "fixer upper" house was cheap. Not any more. "Fixer upper" houses now all sit on a piece of dirt "worth" $300,000 plus. Thanks to the urban growth containment racket.

Did I get you once before, to read "The Housing Bubble and the Boomer Generation" by Robert Bruegmann?

You know Bronwyn Hayward? Did you notice her finding that young NZ-ers major fear was having to spend their lives living in apartments rather than houses with backyards?

I take your point entirely. i heard Brownlee say today "we are a property owning democracy' today and writhed. only way for kids to get housed today is by inheritance.( as houses are 7 times earnings, instead of 2-3 formerly)

I am grateful too for the reference to london School of Economics research..i particularly esteem it as I graduated and did Ph.d at LSE. it was very rigorous and vicious to students, hard to get in but they sent 40% down the road.

A big breakthrough in our understanding of the housing affordability issue, comes from Paul Cheshire and various colleagues at the London School of Economics, pointing out that under conditions of restrained land supply, every attribute of housing becomes "rationed" by incomes. (eg space, location, age and quality of home, local amenities). The resulting social disparities are worse than the initial income disparities themselves.

Cheshire and Sheppard (2001): "The Welfare Economics of Land Use Planning"

Cheshire and Sheppard (2005) "The Introduction of Price Signals into Land Use Planning: A Proposal"

Cheshire (2008) "Discussion of the Barker Review"

Cheshire (2009) "Urban Land Markets and Policy Failures"

Cheshire (2009) “Urban Containment, Housing Affordability and Price Stability: Irreconcilable Goals”

Another LSE paper, describes how rising incomes in Britain have been capitalizing into land rents in recent decades - the relationship is one-to-one EXCEPT at the highest income levels and the lowest income levels. The highest income people end up paying more for the housing attributes they want (and still have plenty of disposable income) and the lowest income people end up trapped into paying more of their incomes for less – or simply never becoming home owners and/or never raising a family. The average age of a first home buyer in Britain is said to be well over 30.

Gibbons, Overman, and Resende (2011): "Real Earnings Disparities in Britain"

Bob Day: “The tyranny of urban planning: home truths about home affordability” (2008)

".........For centuries, the legitimacy of the British parliament was based on property rights, not citizenship. Nations in the 20th century that either adopted, or had democratic institutions imposed upon them, proceeded immediately to the one-person-one-vote method of election rather than going through the property ownership stage – which in England lasted over 800 years. Perhaps this is one of the reasons why such democracies have proven so fragile.
Without property of their own, voters have limited interest in protecting the property of
others. And if history teaches us anything, it teaches that when you take away property
ownership rights, you take away a substantial chunk of personal freedom.
Perhaps instead of rushing to impose democracy in developing countries in more recent
times, the West would have been better off establishing private property, embedded within the rule of law, first. Private property creates civic order. Civic order gives rise to civic representation – as it did in pre 18th Century Britain. Make everyone secure in their own quarter acre and many of the benefits of democracy will be achieved.....

".........Australians have been home owners rather than tenants ever since European settlement began. Land was cheap and wages high and the culture of home ownership became strongly entrenched. Home ownership became a symbol of our self-reliance, a part of our national ethos and culture, and this was particularly true for the hundreds of thousands of migrants who came to Australia from war-torn Europe. The dream of home ownership, so deeply entrenched in the Australian psyche, is founded on the idea that in a free and democratic society the security and stability that comes from having a home of your own should be within the reach of all citizens. And so it was that from the 1950s onwards the rates of home ownership in Australia increased significantly, passing 70% by the early 1980s. Home ownership was a constant ambition of the Menzies governments – much derided within left wing circles at the time whose regular refrain was, “We do not want little capitalists”. Menzies response to this attitude can be found in his great ‘Forgotten People’ address of 1942 in which he recognized the moral, social and emotional importance of the family home.

"The material home," said Menzies, "represents the concrete expression of saving 'for a
home of our own.' Your advanced socialists may rage against private property (even whilst they acquire it); but one of the best instincts in us is that which induces us to have one little piece of earth with a house and a garden which is ours, to which we can withdraw, in which we can be among our friends, into which no stranger may come against our will."
Menzies understood that the human instinct to build and bequeath a home sent lasting
ripples through every aspect of social and economic life.
"I do not believe that the real life of this nation is to be found in the great luxury hotels or so called fashionable suburbs”. He said, “It is to be found in the homes of people who are nameless and unadvertised, and who, whatever their individual religious conviction, see in their children their greatest contribution to the immortality of the race. The home is the foundation of sanity and sobriety; it is the indispensable condition of continuity; its health determines the health of society."
And Menzies matched his words with deeds. He presided over an Australia with enviable
levels of home ownership. It is no coincidence that this was an Australia with low levels of unemployment, low interest rates, high immigration, and a high degree of social cohesion. The fact that not just people on average incomes, but many on less than average incomes, could become home owners, was an important factor in Australia’s political stability since federation. Australia was a property owning democracy, a nation of home owners.

Since World War II the average Australian was able to buy their first home on the average
wage. Traditionally, the median house price was around three times the median household income. For example, when the median income was just 1,000 pounds per annum in the early 1960s, one could buy a basic house on a basic block of land for around 3,000 pounds. When the median income was $10,000 per annum in the 1970s the median house price was $30,000. And when the median income was $40,000 per annum in the early 1990s the median house price in most capital cities was $120,000. Young couples could get a start in the housing market, manage a home loan on one income, start a family, and work their way up from there.

In human affairs there has been an imprecise, and at times neglected, moral contract
between generations which dictates we should leave things better than we found them. In other words, we shouldn’t arrange our lives simply to serve our own needs but we should consider those who are to follow.
When it comes to home ownership however, we are clearly breaking our contractual
obligations. We are making home ownership much harder for the next generation. If we do not act to ensure that housing affordability is restored we will most certainly deny vast
numbers of young people the opportunity to become home owners.
The social and economic consequence of large numbers of people reaching retirement as renters will not only effect the quality of their lives and the choices they are able to make but it will also create an enormous burden for government in funding housing and social services.
The economic consequences of all that has happened over these past few years have been as profound as they have been damaging. The capital structure of our economy has been distorted to the tune of many hundreds of billions of dollars and getting it back into
alignment will take time. But it is a realignment that is necessary. We cannot deny the rising generation a home of their own merely to satisfy the ideological fantasies of town planners and the financial concerns of State and Territory Treasury officials. We cannot deny ourselves the joys of grandchildren because the young women of Australia have to work to pay mortgages instead of raising a family. The joke that high mortgages are the new contraceptive is becoming no laughing matter. Young women used to be afraid of getting pregnant, now, as they approach 40, they are afraid of not getting pregnant. We have to get back to the situation where a couple can pay off a mortgage on one income so they can start a family in their late 20s, not in their late 30s or early 40s.
One of the more pernicious aspects of high land prices ie high mortgages, is the forced
misallocation of capital and family income into mortgage payments instead of higher
standards of living, assets, goods, travel, children’s education, appliances or even foregone income to spend more time at home. The most serious manifestation of this gross distortion in our capital structure, is the postponement of raising a family, and the impact on fertility rates which accompanies this trend......."

It is ironic that Bob Day said:

".....Private property creates civic order. Civic order gives rise to civic representation – as it did in pre 18th Century Britain. Make everyone secure in their own quarter acre and many of the benefits of democracy will be achieved......"

The London School of Economics papers I listed above, show how this process has been reversed in Britain since their 1947 "Town and Country Planning Act". This is a major factor in creating Britain's stalled, socially immobile underclass.

I am picking that the cities of the USA with low, stable land prices, will be the Western world's most riot-free zones for the next decade.

Look at the difference "low urban land prices" makes to "discretionary incomes", for a start:

Refer graph on page 5 of:

http://www.houston.org/economic-development/joel-kotkin/pdf/KotkinAppend...

To a man with a hammer, every problem is a nail......

Hey, I've got lots more tools in my kit, it's just that this is the only bit Neville didn't really cover off in his otherwise excellent article.

But "opportunity urbanism" actually counts for a lot. I think it is the most important factor; then comes  "family stability", then comes "education". You watch that space. I am serious. Besides being riot-free zones, the cities of Southern and heartland USA that have had low, stable urban land prices, will be "the only place to be" in the western world over the next few decades. Their lower taxes, business friendly policies will help; so will their strong "evangelical Christian" component with its influence on family stability.

Here are 2 different, independently done analyses:

http://www.newgeography.com/content/002322-the-next-future-boom-towns-in...

http://www.policom.com/PDFs/2011EconomicStrengthsmallfilesize.pdf

I will watch with interest....because I suspect your assumptions are seriously faulty.

Time will tell.

regards

I'd go back to the old dosage.

It takes up less column-inches.

 Current announcement from the government not good enough to solve NZYouth unemployment.

I remember when I was a youngster. I was with many things and people, authorities, even occasionally with friends at war, sociologically. It was an extremely difficult period of time.

But end of the day the environment was okay – I knew it was me - who caused trouble. The world around me was okay. I experienced a great education, sports, had lot’s of space, freedom of nature and the positive spirit to overcome the problems. I knew and the majority of youngsters knew we had a future.

 I think our young generation growing up under similar conditions, but combined with more difficulties in their environment and with the prospect of no jobs – is when they snap – and the blame games on cell phones with friends in similar positions begins. Youngsters are at war – sociologically – until they find enough soldiers to gang the streets.

Without decent job and training prospects, NZYouth don’t feel to be part of our society- and as a consequence separate.

What is a "decent job"?

Is it right to use this term at all.

When have politicians ever solved a social problem and not sought to gain from doing so?

I describe a decent job as - skilful, satisfying and paid good enough to maintain, what is regarded as an average OECD life style standard.

 With fairer, more balanced wage policies 10’000 of skilful jobs could be created in most production sectors in western societies.

A cap on maximum wage would make talks about minimum wages rather senseless.

Looking into current developments on many fronts – the world will never recover again, simply because among the powerful in societies ethic and moral requirements and standards don’t prevail.

My money is going on a bet the Kiwi 'riots' are being organised as you read this...with the election closing in, what better than a good riot where rent a mob dress for the occasion.

That aside, why not reintroduce the milk in primary schools programme that so many 'enjoyed' as long as the milk didn't go off in the sun before one got to tear through the foil top.

Labour would not be happy if National make this move, considering they had 9 wasted years and didn't do it.

If Key is a smart as people think, it can be avoided, I hope so:

http://www.stuff.co.nz/sunday-star-times/opinion/5440898/Don-t-wash-away-the-scum-John

 "... the International Labour Movement "public Credit"... give it a rest Parky.

 "Once the open transparent education process has taken place constitutional checks and balances must be put in place to set whiteline boundaries that make clear to all if the process has been abused, only then can you blame all equally if they continue to crap in their own nest."......and you believe this rubbish.....that's why it's so funny.

 " I have said many times will only be an improvement upon the current if the politicians themselves and the public have been fully informed indepth of the system".....and you think keeping the public fully informed is something that a socialist govt would do?

Now tell us all Parky...who gets to decide what "fully informed" means......!

A fine piece Neville, though I except some of the commentary will leave you wondering whether you should laugh or cry. More please.

My 10 year old son visited the rellies a while back and spent a week playing xbox games with his cousins. By the time i arrived he was a different kid. Violent and aggressive and it took two or more weeks to get our son back to the one we knew. The cocktail of violent video games, aggressive hypnotic music, MTV / Lady Gaga etc are all part of the social brainwashing well under way thats destroying our societies. Throw onto the cauldron the other nasties as they get older, the skewed media reports that bombard us daily and  its no wonder many of our young people are severely dysfunctional to the point where they are incapable of holding a job, even when they manage to get one.  Todays youth is tomorrows governments. Short of a miracle, we may have gone beyond the point of no return .