Nuplex joins a long line of other industries, manufacturers, retailers, government departments, SOEs, etc, who plan to shed jobs,
The announcement of redundancies adds to a shocking list of job losses this year alone,
- ANZ; 1,000 redundancies
- Wire by Design, 55 redundancies
- Hakes Marine; 15 redundancies
- Telecom; 400 redundancies
- Brightwater Engineering; 40 redundancies
- Pernod Ricard New Zealand; 13 redundancies
- Depart of Corrections; 130 redundancies
- Summit Wool Spinners; 80 redundancies
- Ministry of Foreign Affairs and Trade; 80 redundancies
- Cavalier/Norman Ellison Carpets; 70 redundancies
- IRD; 51 redundancies
- Flotech; 70 redundancies
- NZ Police; 125 redundancies
- CRI Plant and Food; 25 redundancies
- Te Papa; 16 redundancies (?)
- PrimePort Timaru; 30 redundancies
- Kiwirail; 158 redundancies
- Fisher & Paykel; 29 redundancies
- Goulds Fine Foods; 60 redundancies
- Canterbury University; 150 redundancies (over three years)
- Solid Energy;
363 redundancies460 redundancies
- Tiwai Pt aluminium smelter; 100 redundancies
- Axiam Metals; 44 redundancies
- Norske Skog; 120 redundancies
- Goodman Fielder; redundancy numbers t.b.a.
- Dunedin City Council/Delta: 30 redundancies
- Blue Sky Meats; 100 redundancies
- Kaipara Ltd/Stockton Alliance; 63 redundancies
- Wainuiomata New World; 44 redundancies
- Nuplex; 64 redundancies
- Newmont Waihi Gold; 20 redundancies
- Ministry of Justice; 70-200 redundancies
- Salisbury School in Nelson and McKenzie Residential School in Christchurch; 90 redundancies
- Rakon; 60 redundancies
What sets Nuplex’s announcement apart from others was this extraordinary statement from New Zealand Manufacturers and Exporters Association president, Brian Willoughby,
“New Zealand Manufacturers and Exporters Association president Brian Willoughby said Nuplex’s decision would have come after all other options were exhausted. “Nuplex would have been working really hard to be as effective as it could, like the other companies that have announced these closures and layoffs. This is the end game – they can’t make it work.”
He said the Government, and past governments, clearly understood the reasons why manufacturers and exporters were facing such challenges.
“They have all operated with benign neglect and let it get to this,” said Willoughby. “There are so many buttons that could be pushed.”
He said the Reserve Bank could lower interest rates, which would help keep the New Zealand dollar’s strength in check.”
“Benign neglect“, Willoughby calls it.
Another term is the free market in full operation.
Were it not for the fact that thousands of New Zealanders are losing their jobs on a weekly basis, pushing up the unemployment rate, I would find Willoughby’s remarks laughable.
Businessmen and women are quick off the mark to demand less State interference and more market de-regulation to suit their vision of a pure free market.
Both National and Labour governments have been happy to comply, reducing company tax rates, as well as personal marginal tax rates for high income earners.
In the last four years, company tax rates have been slashed from 33% to 28%.
Industrial labour “reforms” have included the 90 Day “trial rate” to allow employers to take on more staff more easily (and still unemployment is rising?!) since 1 Aprl last year.
And FTA deals are being planned all over the place.
If National was any more “business friendly”, politicians would be literally climbing into bed and sleeping with business people. (No inferences made.)
And business sector groups are now whinging that past governments “ have all operated with benign neglect “?!
As if Brian Willoughby’s whining wasn’t enough, Catherine Beard, executive director of Manufacturing NZ, made this stomach-churning complaint,
” She said measures the Government could take to address the strong dollar included reducing debt, to take the pressure off interest rates, and putting an end to “poor quality spending” such as Working for Families and student loans. “
Yeah. Why should families raising kids and young people starting out in life get all the breaks, huh?
I look forward to Ms Beard advocating an end to namby-pamby laws protecting workers’ conditions so that children can have real choices in life.
Like whether to work in sweat shops or clean the insides of chimneys.
Choice is important.
= fs =
… they will always default to one of three positions;
1. Blame the previous government
2. Blame the welfare state and/or beneficiaries
3. Blame the global recession (but not for an increase in welfare beneficiaries – that’s a “lifestyle” choice”)
Pick a public on-line messageboard at random. Look at the postings on political discussion-threads. Note the response from right wingers and neo-liberals.
When confronted by a failure of the ‘free market’, the neo-liberal and/or right winger will always respond with one of the three options above.
Rule #1 of the Right Wing mentality: never accept responsibility. (That’s only for welfare beneficiaries and the poor.)
It’s all they have to explain the failure of their ideology.
= fs =
In the late 1970s, I had the opportunity to visit my parent’s homeland, behind the Iron Curtain. It was possibly the most educative experience of my life, and I had an opportunity to witness, first hand, an economic and social system that was quite alien to me.
Some of the lessons I learnt…
- Extreme economic policies – whether marxist-leninist or neo-liberal – don’t work, and will ultimately fail. Neither cater for human needs, individually or socially.
- It’s true what they say about centralised planning and the public transport system; it was incredibly cheap, efficient, and very user-friendly.
- Alway take extra jeans with you to sell on the black market.
- Do not mess with the local police. Ever.
- Unemployment doesn’t exist in a socialist country – though they have three or four people doing the job of one. That’s the trade-off; unemployment or over-staffing. Which do you prefer? (At least with over-staffing, there were few idle hands for mischief-making and you didn’t have to waste money on unemployment benefits.)
- New Zealand was actually more egalitarian (or socialist or whatever you want to call it) in the 1970s, under Norman Kirk and Robert Muldoon – than an actual Soviet Bloc country. Weird – but that’s how it felt.
- There was no such thing as inflation. Oh no – they just changed the labels. So Brand X of coffee at 100 forints would disappear off the shelf, to be replaced with Brand Y, at 110 forints. Or a lower weight. That was marxist/leninism’s version of capitalism’s “creative accountancy”.
And it appears that, judging by recent media reports, New Zealand businesses have caught on to Item #7. Instead of raising prices, simply reduce the content.
The only thing is… it didn’t work very well for the Soviet Bloc, and their economies eventually all but collapsed by the late 1980s, or early 1990s.
Just a thought for us smug Westerners. Reducing content and/or brand-name replacement is only a temporary sticky-plaster and hides fundamental problems with the economy.
As if the lessons of the global banking crisis and resultant recession wasn’t enough of a clue for the West…?
Ok, who’s up for a
150 135 gr bar of Cadbury?
= fs =
The latest evidence of the inability of the “invisible hand” of the Free Market to cope with the modern complexities of 21st Century society and economy. From an article by Richard Meadows, in todays Faixfax website;
“Despite unwillingness to hire, New Zealand businesses paradoxically saw the lack of a skilled workforce as a major impediment to growth in 2012.
Grant Thornton New Zealand partner Peter Sherwin attributed the apparent discrepancy to an overall caution among employers after ”a couple of false dawns”.
Firms did signal concern about the availability of skilled workers 39 per cent, which was 12 per cent higher than the previous period in 2011, he said.
”We have unemployed people but do they have the skills for the jobs that are going to be available? This gets back to one of the real challenges for New Zealand, which is to get a better match between tertiary education and industry.”
Sherwin said there was ”a clear disconnect” between what the education system was producing and industry demands, and he called for a collaboration between industry, the education sector and government to improve the ”connection’‘.” – Source
Since when does the “invisible hand” of the free market required assistance from the State?
At what point did Business decide that it requires Central Government to fulfill it’s needs?
Since Roger Douglas implemented his neo-liberal “reforms”, the State was to be rolled back and private enterprise allowed to get on with it. We were told time and again;
- business is more efficient than the state
- business can meet its own needs
- the State cannot meet the needs of an economy – that is the role of business
- Business = good, Government = bad
- Business does not need subsidies
- etc, etc, etc.
In which case why is private enterprise not training and upskilling it’s own workforce?
Why is the “invisible hand” of the free market not providing a skilled workforce, according to laws of Supply & Demand?
Because, my dear fellow, New Zealanders; like the “trickle down” theory, the “Invisible Hand” of the free market is bollocks.
The “free market” an ideological scam; a confidence trick fed to the public to justify rolling back the State; cutting social services; implementing User Pays; and reducing taxes for the rich. Like a carefully constructed religious cult, the New Right scammers have their loyal followers who have been sucked into this little ‘game’, to spread the “Gospel of Greed”.
Every so often, though, aspects of the truth appear and we glimpse the reality behind the facade.
The reality is that a modern state cannot function without government; an effective civil service; and social services that are available to all citizens regardless of their material wealth (or lack, thereof).
The reality is that taxes cannot be cut without cutting something in return; healthcare; education; public transport; and the back-office support staff that allow these services to function.
If we cut the back-office support staff – as this government has done in the last three years – be prepared for some serious stuff-ups. As Anne Tolley discovered recently to her discomfort.
And ultimately, we will see more of this,
National handed out two tax cuts – April 2009 and October 2010 – and that money had to come from somewhere. Much of it was borrowed from overseas (at $380 million a week) – and the rest was achieved by cutting back on social services.
And jobs training.
Which means businesses complaining about a lack of skilled workers; “Despite unwillingness to hire, New Zealand businesses paradoxically saw the lack of a skilled workforce as a major impediment to growth in 2012.“
As BERL pointed out in December last year,
“A new study suggests the country could lose between $7.2 and $15.1 billion dollars annually if the Government withdrew its investment in industry training.
The study by the Business and Economic Research Limited (BERL) sets out to quantify the costs and benefits of industry training both to businesses and to the country.
According to one model, it found a cut in all public funding towards industry training would result in a loss in gross domestic product of 0.6 to 1.8 percent by 2014, and between 2.9 and 6 percent by 2021.
That equated to a loss of between $1.2 and $3.7 billion annually in the short-term and between $7.2 and $15.1 billion in the long term.
BERL said under such a scenario, the loss of skilled labour would have a detrimental effect on the export sector, crimping its capacity and reducing its competitiveness as industries competed for a smaller pool of talent.
The report, commissioned by the Industry Training Federation, said the results underlined how the country’s skill levels could ”positively impact on the quality and value of the goods and services produced, and the standard of living in New Zealand”.
However, it also noted the economy was complex and warned that ”any attempts to prioritise or isolate particular industries, sectors, occupations or skills as being more or less important are economically unsound”.” – Source
Because many of our skilled workers have had a gutsful and left for Australia.
And around and around and around it goes…
Why? Because relying on the “free market” to achieve certain outcomes is akin to waiting for The Rapture to arrive. Folks, it ain’t never gonna happen.
Eventually the good people of New Zealand are going to realise that National is spinning us a yarn, and is simply relying on ideological dogma for better times.
Personally, I’m putting my money on The Rapture coming first.
To Fear Facts Exposed for source.
Additional Blog Entries
Ir seems quite likely that New Zealand will soon be joining the ranks of Japan and San Francisco, where earthquake insurance is either highly expensive, or unavailable to home owners,
Earthquake Recovery Minister Gerry Brownlee may chest-thump and bellow till the cows come home, but if insurance companies – as Chris Ryan is suggesting – no longer consider New Zealand property a safe risk to insure against earthquakes, then he had better start taking notice.
Internationally, the insurance industry has been hard-hit after the severe floods in Queensland; two major quakes in Christchurch; and a triple-whammy in Japan; earthquake, tsunami, and atomic reactor disaster. Insurance companies have been hard hit, as Reuters reported in March,
“Some analysts said the disaster, combined with heavy losses already suffered this year from floods in Australia and last month’s New Zealand earthquake, could push up global insurance prices, boosting insurers’ shares.
“In our view the loss will be so large that it will probably provide the trigger to ensure a re-rating of the non-life sector,” Panmure Gordon analyst Barrie Cornes wrote in a note.” Source
Climate-related disasters were also impacting on the insurance industry,
“Climate change is largely to blame for Australasia putting in almost a quarter of the world’s natural disaster insurance claims last year.
Data from major reinsurance provider Munich Re, shows that from 1980 to 2009, Australasia was responsible for 3% of natural disaster insurance claims in dollar terms. But after the Christchurch earthquake, floods in Queensland, and enormous hailstones in Melbourne and Perth, that skyrocketed to 22% last year.
Munich Re, in its own report on the deluge of natural disasters, said climate change “is real and continuing” and cited floods in Pakistan and wildfires caused by a heatwave in Russia. The Christchurch quake was not climate-change related.
Munich Re said 2010 was one of the warmest years since 1850 and featured the second-highest number of loss-related weather catastrophes since 1980, when it started keeping data.
Niwa principal climate scientist Dr James Renwick agreed that weather events like heavy rain were linked to global warming. “It’s possible part of the change since the 1980s is natural variation, but I’m sure there’s a climate change component. We know the globe has warmed and it’s well-documented that the occurrence of extreme rainfalls around the world has increased in a way that’s consistent with the climate models,” he says.
“It’s just what you’d expect – you warm things up, more moisture, more energy, more rain falls. There’s definitely a climate change component in extreme rainfalls around the world.” ” Source
So it seems a little strange that Gerry Brownlee is (a) attempting to dismiss Chris Ryan’s warnings as “scaremongering” and (b) is in denial that re-insuring properties in this country will not be a major problem in future. Of course it will be a problem! How can it not?
Insurance companies and their re-insurers have suffered billions of dollars worth of claims over the last year – $34 billion estimated for the Japanese ‘quake and tsunami, alone, according to a Bloomberg report.
Mr Brownlee should know how the free market works. After all, his party – National – espouses the doctrine of the free market as part of it’s core-philosophy.
Even as we face the prospect of the insurance industry abandoning New Zealand households – we may be left to our own devices when it comes to insurance. Which may be the EQC.
Whilst the EQC is not a full-insurance company in the sense of Tower, AMI, AMP, etc, it has provided a level of protection to New Zealanders since it’s inception in 1945.
The only thing is – it’s broke. Two calamitous earthquakes in Christchurch have effectively emptied the Commission’s ‘war-chest’. Source. As John Key said in February of this year,
“”The good news part of the story is that EQC had about $6 billion before that (quake), that’s going to be exhausted, but we pay in on a continuous basis and we had significant re-insurance in the order of $5b, that will be exhausted.”" Source
Irrespective of Mr Brownlee’s futile rantings against the Insurance Council, it should be abundantly clear that in the near future we will not have the insurance cover that we once enjoyed. Those days are over.
We will have to rely on our own resources and our own ingenuity, whether we like it or not. (Most likely ‘not’, going by past experiences of Baby Boomers who like to Spend Now, Pay Later (or Never, preferably – let the kids pay). To that end, the Greens – as usual – have once again realised what must be done,
“So, it seems, the Greens were right all along – a special levy to fund the costs involved with the Christchurch earthquake still makes good sense, if only (this time around) to replenish the funds available to the Earthquake Commission. Yesterday, it became apparent that the likely cost of the Christchurch rebuild had risen by a massive $4 billion.
This blowout means the EQC couldn’t cope with an additional major disaster (ie anything costing over $2.5 billion) and the government would have to pick up the tab, directly. There are three options on the table : (a) a special levy on all taxpayers (b) a further additional charge attached to insurance premiums already expected to rise significantly, or (c) a rise in income taxes.” – Gordon Campbell, Source
However, in the light of Chris Ryan’s warnings, we may have to reconsider the role of the EQC to adopt a more wide-ranging, pragmatic role in earthquake and flood insurance. The EQC may have to step in where private insurers once provided a service – or else face the prospect of uninsured properties. That would have serious consequences for current and prospective building owners. (Banks currently insist on full insurance cover before they will consider extending a mortgage over a property.)
Once upon a time, we owned an insurance company called – quite simply – State Insurance. State Insurance was sold in June 1990 by the Bolger-led, National government of the day.
It now seems that may have been a mistake (as most asset sales were). The people of this country may yet discover that the Free Market is a Fair Weather friend and when times are tough, we will have to step up and put in place our own, Very Kiwi Solution(s).
The time for a new State-owned insurance company – “EQC-Plus” - has come.
I guess this explains why milk, other dairy products, tomatoes, etc, are so expensive.
And the Minister for Agriculture, David Carter, can save taxpayers the expense of a Parliamentary inquiry into why milk is so expensive here in NZ…
I guess it wasn’t such a bright idea to allow supermarkets to buy each other up, until we had only two, nation-wide chains remaining. Duopolies are not noted for promoting competition and keeping prices down.
New Zealand’s supermarket duopoly:
Chalk up yet another cock-up for the free market, unregulated economy?
I think so.
+++ Updates +++
Parliament’s Commerce Select Committee inquiry into milk prices gets under way,
Floating cities: PayPal billionaire plans to build a whole new libertarian colony off the coast of San Francisco
- Ocean state would have no welfare, no minimum wage, and few restrictions on weapons
- Platforms would house 270 people and hundreds could eventually join together
PayPal-founder Peter Thiel was so inspired by Atlas Shrugged – Ayn Rand’s novel about free-market capitalism – that he’s trying to make its title a reality.
The Silicon Valley billionaire has funnelled $1.25million to the Seasteading Institute, an organisation that aspires to launch a floating colony into international waters, freeing them and like-minded thinkers to live by libertarian ideals.
Mr Thiel recently told Details magazine: ‘The United States Constitution had things you could do at the beginning that you couldn’t do later. So the question is, can you go back to the beginning of things? How do you start over?’
The floating sovereign nations that Mr Thiel imagines would be built on oil-rig-like platforms anchored in areas free of regulation, laws, and moral conventions.
The Seasteading Institute says it will ‘give people the freedom to choose the government they want instead of being stuck with the government they get’.
Mr Theil, the venture capitalist who famously helped Facebook expand beyond the Harvard campus, called Seasteading an ‘open frontier for experimenting with new ideas for government’.
After making his first investment in the project in 2008, Mr Thiel said: ‘Decades from now, those looking back at the start of the century will understand that Seasteading was an obvious step towards encouraging the development of more efficient, practical public sector models around the world.
‘We’re at a fascinating juncture: the nature of government is about to change at a very fundamental level.’
Mr Thiel and his colleagues say their ocean state would have no welfare, looser building codes, no minimum wage, and few restrictions on weapons.
Aiming to have tens of millions of residents by 2050, the Seasteading Institute says architectural plans for a prototype involve a movable, diesel-powered structure with room for 270 residents.
The long-term plan would be to have dozens and eventually hundreds of the platforms linked together.
Patri Friedman, a former Google engineer who is working on the project told Details that they hope to launch a flotilla of offices off the San Francisco coast next year.
‘Big ideas start as weird ideas,’ Mr Friedman said.
He predicted that full-time settlement will follow in about seven years.
But while some Ayn Rand acolytes may think the idea is brilliant, it’s not without its critics.
Margaret Crawford, an expert on urban planning and a professor of architecture at Berkeley, told Details: ‘it’s a silly idea without any urban-planning implications whatsoever.’
Mr Thiel told an audience at the Seasteading Institute Conference in 2009 that: ‘There are quite a lot of people who think it’s not possible.
‘That’s a good thing. We don’t need to really worry about those people very much, because since they don’t think it’s possible they won’t take us very seriously. And they will not actually try to stop us until it’s too late.’
I fully support founding such a colony. In fact, I’ll donate $100 for a (one way) ticket for Don Brash to migrate there.
I’ve suggested – on several occassions – that neo-liberals who want to live in a free-market, minimalist government, zero-tax, user-pays society have just such a country to migrate to: Somalia.
Somalia is perfect and meets their criteria in every respect.
Of course, as part of user-pays, they would have to pay for their own security; their own private police force. And why shouldn’t they? After all, why should other taxpayers pay for protection of someone elses’ property, in a User Pays nirvana?
Strangely enough, as far as I’m aware, no neo-lib has ever taken up my offer.
And stranger even still, neo-libs seem to prefer living in New Zealand; a country built on collective efforts by it’s citizens to build up every aspect of present day society; electricity sector, education, railways, health, roading, police, bridges, libraries, etc. Even telecommunications, airlines, and television started off as tax-payer funded services. All paid by our taxes.
Private enterprise was focused on providing citizens with supermarkets, clothing, shoes (once upon a time), and other consumer goods. It was a good balance.
“Mr Thiel and his colleagues say their ocean state would have no welfare, looser building codes, no minimum wage, and few restrictions on weapons.”
No minimum wage? But… who would clean their toilets?
No building codes? On a free-standing oceanic city? Oh, I can see that working… not.
Call me cynical, but I doubt if Peter Thiel’s ‘Seasteading’ project will succeed. For one thing, human nature is involved – and as we all know, human nature can be a bugger of a thing to deal with.
Secondly, what happens if Thiel’s ‘island’ gets in trouble? Perhaps struck by a hurricane? Will the Seasteaders expect rescue from the international community? And will they be willing to PAY for assistance? (User pays, of course.)
The article further states,
“The Seasteading Institute says it will ‘give people the freedom to choose the government they want instead of being stuck with the government they get’.”
Uh oh. That sounds perilously close to that pesky concept popularly know as “de-mo-cra-cy”. Damned dangerous, that “de-mo-cra-cy”. What happens if, in time, the population of ‘Seastead’ elect a government that is more interventionist?
Will Thiel then build another libertarian community? To get away from the first ‘Seastead’, taken over over “leftists”?
Personally, I think Somalia would still be a cheaper option.
Let’s be honest here, though.
This is about one thing: money. Thiel wants to keep as much of his money as possible and not pay taxes. There may be other, immensely wealthy individuals, who feel lifewise.
Well, I say “good luck” to them. Let them set up their little sovereign “Island State”. Let them learn the hard way that a functioning, balanced, society involves more than just having a bloated bank balance. A dynamic society is a collection of mutually supporting groups and individuals – not just a handful of wealthy people.
My guess is that this little “Profit Paradise” will not last long. Nor will it be self-sufficient. And, the inhabitants will still want to spend (most of) their time on the US mainland, socialising, doing business, and all the other things that the rest of us enjoy. Their Island State will be nothing more than a taxation “bolthole”; a floating bank account.
And herein lies the dishonesty of such an idea.
But if billionaires want to spend their entire lives on such an Island, and not leave, then they are welcome to it. Imagine being forced to live your life in one little area; never leaving; and associating only with others of your ilk.
It’s called “prison”.
So the Commerce Commission decided not to hold an inquiry into milk pricing in New Zealand?
But Minister of Agriculture, David Carter, still wants a Parliamentary inquiry to investigate the matter?
Hmmmm… it’s not because the election is only three months away, and National is fearful that Labour and the Greens will be making this an election issue? Surely, politicians can’t be that cynical and manipulative?
Of course not.
What was I thinking.
Perhaps if I might be so bold, and offer Mr Carter a word of explanation as to milk pricing. The price of milk is determined by the free market. The same free market that National endorses, advocates, and embraces with all it’s manly ‘love’. The same free market that National has ordered TVNZ to pursue, by cancelling it’s Public Charter. The same free market it chases with the Trans Pacific Partnership free-trade negotiations.
Yes, National is the party of the Free Market. As John Key told our American cuzzies on 22 July,
“At the most basic level, we share a commitment to the democratic, capitalist system.”
So there you have it, folks. In a nut-sell. Or milk bottle, if you prefer. We are a capitalist system,which means that the price of milk is determined by what you, the public, are willing to pay for it.
Something to consider of 26 November – Election Day.
As for Mr Carter’s call for a Parliamentary Inquiry – my money is on nothing ever coming off it. Much like National’s much-vaunted Jobs Summit in February, 2009.
Remember that little farce?
On TVNZ’s Q + A, David Carter was interviewed by Guyon Espiner, who asked the Minister if two supermarket chains offered enough competition at the retail end of milk distribution. Carter replied that there was competition and said,
“Well, if people want to buy the expensive brands, they can pay $4.80 up to $5.40. They can buy a cheaper brand at that supermarket for $3.30. They can go round the corner to a dairy, quite often, depending on where they live, and perhaps buy that for $2.90. What I’m saying is there’s a big variation on the retail price of milk.”
Milk is cheaper at corner dairy’s, and on sale for $2.90?!?!
Pray tell, Mr Carter – what colour is the sky on your planet? Because on our world, corner dairy-stores are the more expensive option to buy goods.
National members of parliament – out of touch with reality since 1936.
*sighs* I didn’t have to be Ken Ring to know this was going to happen (though Ken would’ve been a month wrong in his predictions). It’s Election Year. This is when politicians play silly buggers up to November 26th…