To intervene or not to intervene, that is the question…
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To intervene, or not to intervene, that is the question:
Whether ’tis nobler in this government’s mind to suffer The slings and arrows of outrageous recessionary fortune,
Or to take arms against a global sea of economic troubles,
And by opposing end them? To be hands on, and interventionist…
(With apologies to The Bard…)
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Farmers get it…
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Rich families get it…
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Kids from rich families get it…
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Insurance companies get it…
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Even cute, furry-footed Hobbits get it…
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And more for the Precious…
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Hell, practically everyone can get it…
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Subsidies for everything and everyone…
But not, it seems, to assist struggling construction companies until the Christchurch re-build kicks in, in earnest, and they can trade their way out of difficulties,
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In a brutally frank analysis of the industry, NZ Herald journalist Anne Gibson wrote this piece about other failed construction companies and the effect it was having throughout the country – see: Recession hammered building firms, say chiefs
Greg O’Sullivan, of Takapuna-based building consultants Prendos, said,
“The recession has hammered the industry to the ground. It becomes a very acrimonious environment. Builders are having to watch every penny to survive.”
Source: IBID
And it was all so unnecessary.
No government could not have prevented the recessionary effects of the Global Finance Crisis. But a more proactive government could have mitigated the harshest effects of the international recession with careful stimulation of the economy.
And by “stimulation” I do not refer to the wasteful, blunt-instrument-style tax cuts of 2009 and 2010. Those tax cuts added nothing to economic growth and only served to cut government revenue (see: Outlook slashes tax-take by $8b).
Thousands of jobs could have been saved. Thousands more jobs created.
A proactive government, with Ministers able to look ahead, would have immediatly implemented strategies to counter damaging recessionary effects;
- a dynamic building programme post-2009′s “Job Summit” (and I don’t mean Key’s wretched cycleway idea – see: Cycleway jobs fall short)
- increased investment, incentives, and subsidies for apprenticeships and other training/education for young people and other unemployed New Zealanders
- reform of tax laws which see inefficient investment in speculative house-buying/selling less attractive, and re-direct investment into productive industry
National should never have allowed our economy to get where it is now.
This is a government that is derelict in it’s duty, and for Steven Joyce and his cronies to carp on about “overseas investment” is a moronic cargo-cult mentality that simply defies understanding.
If New Zealand businesses leaders and Captains of Commerce still believe that National is a “prudent manager of the economy” – then going by the last four years and events in the 1990s – I promise you that you will get what you richly deserve if they are re-elected in 2014 (or earlier).
This isn’t governance. This is economic decline by a thousand cuts.
Expect things to get worse.
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Other Blogs
Additional
NZ Herald: Collapse ‘gut wrenching’ for roofing business (9 Feb 2013)
NZ Herald: Rise and fall of a very modern businessman (9 Feb 2013)
NZ Herald: Brian Gaynor: Mainzeal collapse needs investigation (9 Feb 2013)
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= fs =
Great post. May I repost on The Standard?
Cheers
r0b
Yup. All yours!
Thanks!
About an hour ago I happened to be speaking with a concreter (did our drive-way) and jokingly said to him,
“Just as well you aren’t one of the contractors owed money!”
He looked at me and replied stony-faced,
“Like hell. I’m owed ten grand.”
He had a typical builders’ stoicism, but it must’ve been galling for him nonetheless. The guy is a hard worker and not getting anything for the work he did was a real insult.
Mainzeal’s collapse – coming to a corner of the community near you.
Who does Mainzeal’s collapse benefit? A larger building company. I’m not suggesting a conspiracy but in the same way that AMI collapse benefited IAG (see who is on the board), Mainzeal’s will benefit Fletcher. It’s mates looking out for mates and we’re not their mates… so we’re acceptable collateral damage.
Re my 4.02pm post above , Spacemonkey. The concreter I was chatting to said he’s heard that another construction company (to confirm name) has offered some contractors to take over their contracts to complete jobs – but at half price.
I’m not sure about the validity of this; it’s one tradesman (owed $10k by Mainzeal) relating somnething he’s be told, to me.
If true, then yes, some will benefit from this.
I’m honoured!