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Posts Tagged ‘prime minister’

Nat’s support plummets in yet another poll

- Neil Watts, Blogger, Fearfactsexposed

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But Fairfax subscribers denied the leading news, again. 

Little wonder Fairfax Media are struggling financially and virtually giving their publications away to attract subscribers.

Consistently failing to provide their readers with the news – if the news is damaging to their friends in the National Party – means that Fairfax Media’s credibility as a news provider is poor, and declining.

While less partisan news media jumped immediately on the third poll in a month showing National’s support crumbling, Fairfax avoided the story, as they have done with other polls that are unfavourable to their mates on the Right.

While this highly newsworthy story led the political news on TV last night, as well as on the New Zealand Herald website and Radio New Zealand, Fairfax once again applied the eerie Orwellian denial they have used in the past when a news item doesn’t suit their political agenda.

Predictably, when stuff.co.nz  finally got around to mentioning the poll just before 9am today – some 15 hours after their rivals – it was only to provide readers with the National Party’s spin on the results, with a piece heavily dominated by John Key’s response.

As usual, the Opposition were completely sidelined from Fairfax’s story, and more importantly, the major implications of the latest poll – that Labour and the Greens could form a centre-Left government with a combination of support partners – were completely avoided.  This angle is so obvious to any real journalist, that Fairfax again show their desire to provide propaganda over news, by avoiding it all together.  As I noted here three weeks ago, after they avoided reporting on another negative poll for National, this illustrates exactly why such powerful, biased media corporations are a very real danger to our democracy.  By stifling the debate, controlling the message, and starving the Opposition of comment, media organisations like Fairfax can and do have a frightening influence on our freedom.

Remember how their brainfart polls told readers over and over how the National Party were going to romp back into the Beehive last year?  In detailed analysis of the reasons why New Zealanders didn’t vote, it was found that “a large proportion of non-voters cited the polls predicting the National Party’s victory, and decided the election was a foregone conclusion. The percentage of non-voters who said this was a factor was far higher in 2011 than in 2008″, according to The New Zealand Herald.

Critics at the time – myself included – noted the flawed methodology of these polls, and suggested that they were designed more to influence rather than inform voters.  The resulting election turnout was the lowest in 120 years, with the supposably invincible National Party pushed much closer than the polls had suggested.   Funny that, when their chums in the National Party are riding high in the polls, stuff.co.nz and the Dom Post can’t find a font big enough, but when the news is bad…well, it just ain’t news.  Orwellian, Fairfaxian, call that what you will

Following a week where their political editor was heavily criticised for providing the Prime Minister with a series of glowing PR pieces as she escorted him around Europe,  and where the most damaging elements of a number of issues were avoided, this is not a good look for Fairfax.  Last week, they effectively ran the spin for John Key on the class size backdown, painting Key as “a leader who listens”, complete with a leading survey.  They neglected to mention that the “listening leader” is ignoring New Zealanders over asset sales, and dodged figures picked up by other media showing that power prices would rise significantly once the assets were privatised.  As if all of this isn’t damning enough for Fairfax’s credibility, another survey showed that 50% of stuff respondents favoured the Nazi solution of eugenics to tackle the problem of breeding “ferals”; is this a clear sign of Rightwing propaganda in action?

Had enough of this international corporation providing propaganda disguised as news?  Please share this blog [Fearfactsexposed], join us on Facebook , and tell your friends to boycott everything that this National Party spin corporation publish.  Only a strong public backlash will make Fairfax Media take notice, so let’s bloody have one!

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Fearfactsexposed:  Jet-setting Key accompanied by Fairfax political editor, again

NZ Herald:  Poll: Labour could form Government

Fairfax:  Key not fazed by poll results

Radio NZ: The National Party’s support is faltering in the wake of a series of political difficulties this year

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Acknowledgement

Reprinted from the blog, Fearfactsexposed, with kind permission.

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The Muppet Show – Kiwi style!

21 February 2012 5 comments

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I just want to emphasise that it is not our best guess; it’s just a guess. It’s just to put some numbers in that look like they might be roughly right for forecasting purposes.

“That’s an honest answer.”Bill English, 17 February 2012

That may be an “honest answer” – but it also has to rank as one of the dumbest in New Zealand’s political history.

To explain what Bill English was being “honest” about,

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That’s right, folks, our Finance Minister has just let slip that National has no idea how much money they will raise from the part-privatisation of Genesis Energy, Might River Power, Meridian, Solid Energy, and Air New Zealand.

They don’t have a clue.

The $5 -$7 billion they have been quoting pre and post election are figures seemingly plucked out of hot-air from Parliament’s oxygen-depleted atmosphere. (Oxygen depletion tends to have unpleasant side-effects on a brain such as confused, muddled, thinking.)

John Key – realising that Bill English had made National the laughing stock of the country – jumped in, changing the “best guess” to a “best estimate”,

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However, Key didn’t help matters much when he added,

I think they are our best estimates”.

“There are lots of variables in there … what we do know is the Crown will absolutely have a minimum of 51 per cent shareholding but could have more. We don’t know what price the market will pay at the time; we don’t know the exact timing of all these particular floats.”

So let’s see.  Key and English don’t know any of the following,

  • How much will be raised by the partial-privatisation?
  • Whether they will end up with 51% ownership – or more?
  • Or even the timing of the “floats” (sale of shares)?
  • Or what price the shares will be sold at???

No wonder Greens co-leader Russel Norman said, in utter exasperation,

That isn’t how we should be running the finances of New Zealand.”

Norman wasn’t playing usual political one-upmanship games – he was voicing the entire country’s disquiet at what is rapidly looking like mickey mouse incompetance.

Yet again this is an example of National simply not being up-with-the-play.  Much like unaffordable tax-cuts of ’09 and ’10; the Jobs Summit of 2009 that achieved very little;   the credit down-grade they “never saw coming”; the broken promise on raising gst; the $1.4 billion revenue short-fall – National’s economic policies seem to be ad-hoc at the very best.

No wonder even the business community was left wondering if National had any plan at all for economic recovery.

If this was the Muppet Show, it might look something like this,

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Instead, it looks like this,

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These two clowns muppets are in charge of billions of dollars worth of public property?

I am not reassured. In fact, I wouldn’t trust these two to run  a charity sausage sizzle.

I can imagine how that would end badly,

  • 1 x sausage, @ 50 cents wholesale
  • gas, onion, sauces, napkin, est. 50 cents per sausage
  • Retail price: ? 40 cents   60 cents   75 cents!

Cue: muppet theme & roll credits.

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Other Blog stories

Selling assets will cost us more than keeping them – the idiocy of National

“Best guess?” – National and Fairfax are working very hard for one another

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That was Then, this is Now #7

15 October 2011 4 comments

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Previous Blog post

That was Then, this is Now #6

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Oh for Christs’ sakes, what next???

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More to come.

But seriously, Mr Prime Minister, we can’t afford any more your your government’s “fiscal prudence”!!!

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Politics-Free Zone? “Tui” time!

9 October 2011 5 comments

Last Friday (30 September), Prime Minister John Key (or ‘Dear Leader‘ as he is now known), played radio DJ for an hour. Using the excuse of the “electoral commission rules”, Key’s presence on Radio Live was supposedly an “election free” event,

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During Key’s session on air, New Zealand’s second sovereign credit-ratings downgrade was announced. Again, he refused to discuss the issue, citing “electoral commission rules”. His one hour was to be keep “politics and election free”.

We learnt that his cat was named, “Moonbeam“.

Which is like having Peter Jackson on-air and expecting him not to make any comment whatsoever on any of his movies or the entire film-making industry…

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Just because Dear Leader instructs his listeners that his show was an “election free zone” does not make it so. In fact, it clearly was not “election free” at all, and only the most naive or ardent National Party-apologist could claim it to be. Quite simply, John Key is the Prime Minister and Prime Ministers are political irrespective of what “zone” they might be in.

In fact, hosting a politics-free radio show is a perfect opportunity for any politician to “connect” with his/her electorate and promote their persona as being one-of-the-people.

But there is more to this issue than simply John Key getting one hour of free media exposure. Quite a bit more.

It began in 1984 when Steven Joyce, at age 21,  set up his first radio station, “Energy FM”. From there, his business venture expanded considerably,

“Joyce made his millions in broadcasting. He got involved with student radio as a presenter and programme director while doing his zoology degree at Massey University in Palmerston North. Then he and a group of friends, including radio presenter Jeremy Corbett, started their own station in Joyce’s hometown of New Plymouth.

Corbett says Joyce son of a grocer had a prodigious work ethic: “Steven expects everyone to work as hard as him and nobody does.”

Joyce was 24 when Taranaki’s Energy FM finally got a full licence. Later, the team began acquiring other stations. As Corbett puts it: “I got married and left, and the rest of them became millionaires.”

Joyce says money was the furthest thing from his mind. For years “we kept living like university students [so] we could keep ploughing money back into the business”.

By 2000 he was CEO of an empire called RadioWorks, with 22 radio stations and 650 staff. He didn’t want to sell up, but Canadian company CanWest launched a stockmarket raid and left him standing with a cheque for $6 million in his hand. It was a “bittersweet” moment.”  Source

“In 2004, CanWest Global Communications combined television company TV3 Network Services and radio company RadioWorks to form the new MediaWorks company. On 29 July 2004, 30% of this new company was sold on the NZSX. Three years later, in July 2007, CanWest sold its stake of the company to Ironbridge Capital, a group of Australian investors, who subsequently obtained the remaining 30% from other investors.  MediaWorks is significantly larger than any of its other investments.”  Source

So far we have the following “trail”:  Steven Joyce/Energy FM → Steven Joyce/RadioWorks → CanWest → CanWest/MediaWorks → Ironbridge/MediaWorks, which is the current ownership-situation.

In April 2009, the  Radio Broadcasters’ Association wrote to the now-Minister of Communications, Steven  Joyce, asking for the high cost of renewing radio spectrum licence payments to be spread over 20 years, rather than paid in  one lump sum. Source.

In the following month, May 2009, the Ministry of Economic Development advised Joyce that there was no compelling reason to accede to the Association’s request, as it would “put the Government in a credit financing role“. Joyce followed that advice and subsequently declined the RBA’s request. Ibid.

At around this point, the Dear Leader Prime Minister starts to get involved and things begin to get murky. Around August 8th or 9th,  2009, Brent Impey –  the then-CEO of Mediaworks –  lobbied John Key directly, to get a deferred-payments scheme put in place. (Evidently, such a scheme was desirable not because MediaWorks was in financial trouble – but because it would improve their bottom-line profitability.)

At first, John Key denied even meeting with Brent Impey, and stated this  in answer to parliamentary written questions,

The Prime Minister said he had “no meetings” with representatives of MediaWorks to discuss the deal.” Source

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Two days later that answer was corrected, saying he “ran into” Brent Impey at a “social event” in Auckland where the issue was “briefly raised” and he “passed his comments on” to the responsible minister.Source

It seems fairly unbelievable that one could have a meeting with someone; discuss a matter involving $43 million – and then claim to have forgotten it?!

Despite having declined the Radio Broadcasters’ Association’s first appeal (May, 2009) – after Key  “ran into” Brent Impey at a “social event” the matter was re-visited and on October 22, 2009, Cabinet agreed to the RBA’s request for deferred payments.

Question: What transpired between May 2009 and October 2009 to so radically change government policy, and in effect adopt the role of “credit financing”, against the advice of the Ministry of Economic Development, which Steven Joyce had originally accepted?

Question: What role did John Key have to play in this matter? Because all of a sudden he seemed to become pivotal to this issue and it’s outcome.

Question: How could John Key have forgotten that he “ran into” Brent Impey at a “social event” ?

Click here for a Timeline of events, by NZ Herald report, Derek Cheng.

Essentially then, for reasons that are as clear as a barrelfull of Christchurch liquifaction, this government decided to make a  loan  for radio frequency-fees, worth $43.3 million to MediaWorks.,

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As John Drinnan wrote in the above article,

…the Government allowed them to keep the frequencies and pay the money over a 50-month period – paying 11.2 per cent interest a year. The Crown held a mortgage on the frequency with a strong security.

However, politicians being politicians, they will always argue the point,

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Telecommunications Minister Steven Joyce yesterday said the money was not a loan, but a deferred payment system to help the radio industry during tough times in 2009.” Ibid

Steven Joyce was  adamant that this was not a “loan” to MediaWorks,

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In fact, Joyce goes on to say,

“”They have to present it as a debt because it is a debt they owe the Crown, so how they do that is between them and their accountants.

“All I can tell you is that the Crown has not advanced any cash to MediaWorks at all, that the Crown has offered a deferred payment option to all of the frequency holders who were due to renew at that time, which involved them paying interest and getting in their payments over five years.”” Ibid

So according to Steven Joyce, this is not a debt “the Crown has not advanced any cash to MediaWorks at all“?!

Reallllly?

Is that how it works?!

In which case, property-owners around New Zealandf should rejoice and do cartwheels! We have no debts! The mortgages that our banks and building societies extended to us are not debts at all because they did not “advance any cash” to us!  After all, mortgage monies  are paid directly to the vendor – the new owner never sees a cent of it. Banks and other financial institutions simply hold a mortgage over our properties, and charge us interest on top of principle, to be re-paid.

Which is precisely what this government has done, as already mentioned above,

…the Government allowed them to keep the frequencies and pay the money over a 50-month period – paying 11.2 per cent interest a year. The Crown held a mortgage on the frequency with a strong security.Source

It’s a loan, Mr Joyce. Deal with it.

So perhaps it’s little wonder why Radio Live (owned by MediaWorks) did not extend Labour Leader Phil Goff, and other Party leaders, the same advantage as John Key had,

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Of course Radio Live “didn’t give an explanation for refusing“.  It’s fairly obvious what has transpired in some fairly shady, back room, “arrangements”.  It is fairly obvious that whatever “arrangement” now exists between Media Works and John Key and  his government is now to their mutual benefit.

The question is; did that $43 million buy just the one hour with Radio Live?

Or is there more to come?

Watch this space.

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Additional reading

A word with… Steven Joyce

Wikipedia – Steven Joyce

Key’s six million dollar man – Steven Joyce

Key changes tack over meeting with broadcaster

Wikipedia – MediaWorks New Zealand

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DJ Key talks cats, not tax on radio show – NOT a joke!

30 September 2011 1 comment

This is why our Prime Minister is on a salary of $400,500 – so he can talk about cats.

C-a-t-s.

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This is a good thing, no doubt. After all, who wants to talk about the state of the economy; high unemployment; lack of jobs; the impending second international economic melt-down; asset sales; sale of farmland to overseas investors; etc?

Them is boring stuff, fellas. Here in Nyu Zild, we is kat luvers.

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Question to those 50% of New Zealand voters who think that John Key actually knows what the heck he is doing: why?!

I do not get it.

The man has his hands of the economic tiller; we are drifting without any substantial job-creation policies; he plans to sell half our electricity companies to Americans, Chinese, and god-knows-who-else – and some of my fellow Kiwis still want to vote for him???

As John McEnroe once exclaimed to his world-wide audience; “You cannot be serious!!!

That’s all, peeps. Back to your rugby, or penguins, or whatever…

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How to lose $5.3 billion dollars without any effort at all.

23 September 2011 27 comments

The latest in the on-going saga of our land alienation to overseas interests…

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The eight farms mentioned in the above story are located here,

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Meanwhile, Monaco and Israeli investors have increased their shareholding in the Walter Peak Station Trust,

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By September of this year, the Aquila Group had increassed their holdings from eight to eleven South Island farms, with stated intentions to buy more,

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Since the start of 2006, the Overseas Investment Office (OIO) has approved the sale to foreign buyers of 300,400ha of freehold land and 239,600ha of other interests in land, such as leases.

Those figures are for land passing from New Zealand to overseas ownership, and does not include the  sale of land already in foreign hands.

Which brings us to this latest news,

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A record payout – $10.6 billion – going to New Zealand farmers.

Or… will it?

As more and more dairy farms are sold into foreign ownership, more and more of Fonterra payouts will also end up in the bank accounts of offshore investors. Not only will we be faced with higher prices for milk, cheese and other items containing dairy products – but the profits from the sale of those products will not come to New Zealand.

We will have lost income as well as dairy products.

Imagine if, eventually, half our dairy farms end up in foreign ownership; German, Chinese, American, etc. Then imagine half of Fonterra’s payouts ending up in offshore bank accounts.

Imagine – losing $5.6 billion.

We have already solds many former State assets to overseas investors. The profits from those assets now flow overseas, which will continue to impact negatively on our Balance of Payments account – pushing us further into deficit.

Quite simply put; we are importing more than we are exporting. That makes it more expensive to borrow capital from overseas markets (eg; for our home mortgages), and will eventually affects the interest we pay on those borrowings.

End result; triple whammy;

1. Higher dairy prices

2. Lost earnings

3. Higher interest rates

Now can anyone remind me – what, precisely, is the long-term benefit to New Zealanders to sell our productive land to overseas interests?

Something else to bear in mind when voting this year. The only ones who can stop the further alienation of our own land is us – the citizens of New Zealand. Because, my fellow Kiwis, no one else will do it for us.

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Email sent to the Prime Minister of New Zealand, John Key,

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from:    [email]
to:    john.key@parliament.govt.nz
date:    Sun, Sep 11, 2011 at 12:32 AM
subject:Purchase of farmland

Sir,

At a recent public meeting in the Hutt Valley, in answer to a question from
the audience, you responded that purchases of farmland, by overseas buyers,  
would be restricted to ten farms per purchaser.

Can you confirm that this restriction is in place, and when the regulation was
enacted?

Regards,

- Frank Macskasy
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As of the publication of this piece, no response has been received from the Prime Ministers office.

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+++ Updates +++

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The Fay-led bid for the Crafar farms has failed because it is lower than the Chinese bid. This raises two issues,

  1. If a multi-millionaire such as Sir Michael cannot outbid overseas investors who are hell-bent on buying our farms – then what hope is there for ordinary kiwis, who do not have Sir Michael’s deep pockets, on competing against foreign investors? The answer is obvious; we cannot compdete. We would be outbid every time.
  2. If, as Sir Michael suggests, that over a certain price these farms are not economical, then why are the Chinese willing to pay more ($40 million?) than the farms are worth, from a viability-prospect? Could it be that the Chinese are not interested in profitability as much as securing food-production sources over the next few decades?

This is the clearest example yet as to why only New Zealanders should be permitted to own New Zealand farmland. As the world’s population passes the $7 billion mark, and is heading toward 9 billion by 2050, farmland will be the most important, strategic asset on this planet. Perhaps that is why the Chinese are willing to pay over-and-above what the Crafar farms are worth: they are buying into the future.

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Further Information

Save The Farms

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The world is a “safer place”?!

12 September 2011 2 comments

From our esteemed Prime Minister,

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John Key “would like to think” the world is a safer place?!

Mr Prime Minister – what colour is the sky on your world?

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How superficial can the media get?

2 September 2011 3 comments

Oh, about this much…

 

 

At a time when our country faces enormous problems and challenges; with an election less than three months away; with youth unemployment and other economic problems confronting our society – this is what the media feeds us?!

However, hardly surprising really, and Chris Trotter makes this observation as to why our modern media treats us like juveniles…

 

 

I would also venture a suggestion that the same also applies to our apathy at the upcoming Rugby World Cup. Rugby seems no longer about playing the game nor about the spectators. It’s now about multi-million dollar sponsorships and the heavy-handed controls that accompany it.  (See my piece, “What Killed Rugby?“)

The Big Boys have taken over, and they’ve got the ball now. We can either like it or lump it.

Politics and rugby – both victims of elitism.

 

 

That was Then, this is Now #5

25 August 2011 1 comment

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That was Then, this is Now #4

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That was Then, this is Now #4

23 August 2011 1 comment

Source

Fiji coup condemned

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Previous Blog post

That was Then, this is Now #3

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That was Then, this is Now #3

23 August 2011 2 comments

That was Then, this is Now #2

21 August 2011 2 comments

That was Then, this is Now #1

20 August 2011 5 comments

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3 things we will never see in our lifetime…

18 August 2011 3 comments

There are some things that are simply impossible, according to the laws of physics…

(Oh, ok, I was wrong about #1. It is possible for aliens to travel to Earth and land in front of the White House… )

A lethal lesson in de-regulation…

18 August 2011 1 comment

More here.

De-regulation and an open, unfettered economy was the big fashion in the late 1980s (“Rogernomics”) and 1990s (“Ruthenasia”). It was argued by neo-liberals; the wealthy; and by segments of wannabee-rich middle class, that de-regulation was the new paradigm that would create an efficient; highly productive; wealthy society.

We would become the “Ireland” of the South Pacific – and Ireland at the time was doing extremely well, economically.

So the National government of the day, led by Prime Minister Jim Bolger, and with Ruth Richardson as his Minister ofFinance, continued what a Labour cabal consisting of Roger Douglas, Richard Prebble, Peter Dunne, Michael Bassett, et al, had started: de-regulating the economy.

The new mantra was “De-regulation, good. Government regulation, bad”.

It was a childishly simplistic notion, and one that would cost us dearly in terms of vast sums of money; destroyed dreams; and lives lost.

The years passed. The 20th Century turned into the new 21st Century. The public became tired of National, and elected a new, Labour government, led by Helen Clark. Labour had a hard task of paying off a decade of accumulated debt and resolving deep social problems that were afflicting the country; growing poverty; high unemployment; increasing cases of poverty-related disease; lack of support for the country’s mentally ill;  a loss of state housing (National had sold off 13,000 state houses during it’s tenure); and other pressing matters.

There were also two silent time-bombs waiting in the shadows.

In the early 1990s, changes were made to the Building Act 1991/Building Regulations 1992  with several  subsequent amendments.

Effectively, these amendments de-regulated much of the industry, permitting untreated timber to be used where, previously, only treated varieties could be using for house construction. New materials could also be used that had not previously been common in residential building, including a newly fashionable “Meditteranean style”.

Similar de-regulatory events were to take place in Health & Safety, in 1992,  with regards to mining. In 1998 seven dedicated OSH mines inspectors were absorbed into OSH.  The disbanding of the mines inspectorate group, and moving its functions to the Department of Labour, had saved about $1 million. Health and safety (mines)  inspector, Michael Firmin,  was the sole inspector of mines left.

The bombs were set, and the fuses lit.

On 26 May 26 2001, the first “bomb” went off, with a NZ Herald article  revealing that a growing number of new or near-new houses were rotting because of lack of water-tightness.

On 19 November 2010, the second “bomb” went of at Pike River mine, as a methane explosion killed 29 mine-workers.

Investigation into both the “Leaky Homes Syndrome” and the Pike River disaster have one, inescapable common factor: regulations that were once in place, had been removed; altered; or watered-down. In both cases, de-regulation had meant a lack of direct responsibility for ensuring that whatever regulations did remain, were not observed.

Hopefully, New Zealand has learnt a harsh, expensive, and deadly lesson about de-regulation. Regulations are there for a reason. Like the road speed limit. We may not always like the nuisance that rules and regulations provide – but they exist for our safety and our financial security. (When the Huntly West mine blew up in 1992 there were no fatalites. (Former) Chief coal mine inspector Harry Bell had closed it down 36 hours before.)

If we give away regulation for expediency, or because it fits some trendy political free-market ideology – then be prepared  for the consequences. Because as sure as day follows night; there will be consequences.

One thing I have noticed about my generation, the “Baby Boomers”; we seem to be child-like in so many respects. We are  impatient – we want it now. Until the Cullen Fund – we didn’t want to save for our retirement (the Fund had to bribe us with a $1,000 kick-start from the government – ie, us, the taxpayer). We accepted tax-payer funded free education from our parents – only to abandon it and force User-Pays on our own children, through Student Fees. Charming.

We ignore complicated social issues – in favour of displaced penguins and “Wellywood” signs. We lose interest in matters that demand our long-term attention – a fact that politicians are aware of, and exploit to their benefit.

By god, we need to grow up. Because, collectively, we are still making incredibly bad or stupid decisions based on self-interest and short-term gain.

Our lack of collective wisdom; our inability to see things long-term; our willingness to accept short-term gain – and never mind the consequences – should give us cause for concern.

Unfortunately, I am pessimistic that we will “grow up” any time soon. In fact, I await the next silent “bomb” that is ticking away, somewhere, in the shadows. How much will it cost us? And will we pay dearly, in lives?

Postscript: following the global banking crisis, Ireland is now bankrupt and a fiscal basket-case needing bail-outs from the EU to survive.

A warning from a very, very rich man…

17 August 2011 1 comment

Warren Buffet is  regarded as one of the most successful investors in the world.  He is  ranked among the world’s wealthiest people and was ranked as the world’s wealthiest person in 2008. He is the third wealthiest person in the world as of 2011.

He is not a disaffected socialist, nor  “random leftie” – he has serious money in his bank account(s). So when this guy warns us that the wealthy are not paying their way, and have been “coddled by billionaire-friendly governments” – you know he’s saying something important.

And that we should take note…

Some of us are investment managers who earn billions from our daily labors but are allowed to classify our income as “carried interest,” thereby getting a bargain 15 percent tax rate. Others own stock index futures for 10 minutes and have 60 percent of their gain taxed at 15 percent, as if they’d been long-term investors.

These and other blessings are showered upon us by legislators in Washington who feel compelled to protect us, much as if we were spotted owls or some other endangered species. It’s nice to have friends in high places.

Last year my federal tax bill — the income tax I paid, as well as payroll taxes paid by me and on my behalf — was $6,938,744. That sounds like a lot of money. But what I paid was only 17.4 percent of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent.

If you make money with money, as some of my super-rich friends do, your percentage may be a bit lower than mine. But if you earn money from a job, your percentage will surely exceed mine — most likely by a lot.

To understand why, you need to examine the sources of government revenue. Last year about 80 percent of these revenues came from personal income taxes and payroll taxes. The mega-rich pay income taxes at a rate of 15 percent on most of their earnings but pay practically nothing in payroll taxes. It’s a different story for the middle class: typically, they fall into the 15 percent and 25 percent income tax brackets, and then are hit with heavy payroll taxes to boot.

Back in the 1980s and 1990s, tax rates for the rich were far higher, and my percentage rate was in the middle of the pack. According to a theory I sometimes hear, I should have thrown a fit and refused to invest because of the elevated tax rates on capital gains and dividends.

I didn’t refuse, nor did others. I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off. And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation.

Since 1992, the I.R.S. has compiled data from the returns of the 400 Americans reporting the largest income. In 1992, the top 400 had aggregate taxable income of $16.9 billion and paid federal taxes of 29.2 percent on that sum. In 2008, the aggregate income of the highest 400 had soared to $90.9 billion — a staggering $227.4 million on average — but the rate paid had fallen to 21.5 percent.

The taxes I refer to here include only federal income tax, but you can be sure that any payroll tax for the 400 was inconsequential compared to income. In fact, 88 of the 400 in 2008 reported no wages at all, though every one of them reported capital gains. Some of my brethren may shun work but they all like to invest. (I can relate to that.)

I know well many of the mega-rich and, by and large, they are very decent people. They love America and appreciate the opportunity this country has given them. Many have joined the Giving Pledge, promising to give most of their wealth to philanthropy. Most wouldn’t mind being told to pay more in taxes as well, particularly when so many of their fellow citizens are truly suffering.

Twelve members of Congress will soon take on the crucial job of rearranging our country’s finances. They’ve been instructed to devise a plan that reduces the 10-year deficit by at least $1.5 trillion. It’s vital, however, that they achieve far more than that. Americans are rapidly losing faith in the ability of Congress to deal with our country’s fiscal problems. Only action that is immediate, real and very substantial will prevent that doubt from morphing into hopelessness. That feeling can create its own reality.

Job one for the 12 is to pare down some future promises that even a rich America can’t fulfill. Big money must be saved here. The 12 should then turn to the issue of revenues. I would leave rates for 99.7 percent of taxpayers unchanged and continue the current 2-percentage-point reduction in the employee contribution to the payroll tax. This cut helps the poor and the middle class, who need every break they can get.

But for those making more than $1 million — there were 236,883 such households in 2009 — I would raise rates immediately on taxable income in excess of $1 million, including, of course, dividends and capital gains. And for those who make $10 million or more — there were 8,274 in 2009 — I would suggest an additional increase in rate.

My friends and I have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice.

(Warren E. Buffett is the chairman and chief executive of Berkshire Hathaway.)

Buffet’s analysis holds true for New Zealand as much as it does for his own country, the USA.

In April 2009 and October 2010, this government awarded the highest income earners and the wealthiest the most in tax-cuts.

At the same time, the top ten wealthiest people in NZ (and probably others  throughout the world also increased their wealth by 20 percent) – whilst the rest of the global economy was wracked by the worst recession since the 1930s, and millions lost their jobs.

The old excuse that the “wealthy work hard and should be rewarded for their labours” no longer deserves to be taken seriously.  Most of us work hard, and long hours.

It is time that governments stopped coddling the rich. It’s not like they can take their wealth off-planet to Mars or elsewhere. The rich will still invest their vast wealth.

But it’s time they paid their fair share as the price of living in societies that gave them the opportunities to create their wealth.

It’s high time National looked at a fairer taxation system, and paid for the social services and job creation-friendly policies, rather than the top 10% of  the population and middle-class rich-wannabees.

Otherwise, prepare yourselves for a society of growing inequality.

So far, the indicators are not good…

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Well, I think the ‘message’ is reasonably clear for all but the most ideologically-blind.  Question is – what are we going to do about it?

(Hint: more of the same will probably not work.)

Great Myths Of The 21st Century (#1)

16 August 2011 7 comments

Perhaps the greatest urban-myth, perpetrated and perpetuated by those whose interests it serves, is that the unemployed are there-by-choice, and unwilling to work.

Of course, this is absurd and an outright falsehood.

Fact 1:  The New Zealand December 2007 Quarter Household Labourforce Survey unemployment stood  at 3.4% . This was prior to the global recession hitting NZ.

Fact 2:  By the end of 2008, the New Zealand December Quarter Household Labourforce Survey unemployed rose to 4.6%.

Fact 3:  The New Zealand December 2010 Quarter Household Labourforce Survey unemployed rate increased to 6.8% .

Fact  4: In three years, the Household Labourforce Survey unemployed doubled from 3.4% to 6.8%

Fact  5: In other countries such as the US, unemployment went from 4.8%  in the fourth quarter of 2007 to stand at 9.1%  by July of this year.

Whether the largest economy on Earth, or one of the smallest, the impact of the global banking crisis and following recession caused companies to collapse; down-size; and “rationalise” (reduce) staff. This caused unemployment to skyrocket.

Events in Wall St, USA, had an impact on Main Sts, New Zealand;

“Jobs to go at textile factories”

“Headlines do not reveal true picture of job losses”

“‘Another kick in the guts for rural NZ'”

“Job losses to hit military next week”

“Lower Hutt jobs to go as shops shut”

“Hellaby’s closes: 18 jobs go”

“Australasian Colorado shops closing”

“Grim day of redundancies”

“Jobs to go at troubled baker Yarrows”

“KiwiRail plans to lay off Dunedin staff”

“Thirty-five jobs may go at Niwa”

“Ovation confirms 304 job losses “

“Dunne defends Greymouth IRD job cuts announcement”

“NZ Post shutting stores, axing jobs”

“Ballantynes faces post-quake job cuts”

“Lane Walker Rudkin 470 Redundancies A Tragedy”

And many more here .

As unemployment increased, the number of job-seekers increased. Even the Prime Minister, John Key, has remarked,

“We’re part of a global environment so we can’t control all of the factors that affect New Zealand, but all the indications we have is that 2011 will be a better year.”

Dozens, and often hundreds of unemployed job-seekers would turn up at businesses, that were hiring staff;

It is apparent that the global recession has caused the demise of some businesses, and forced others to greatly reduce staffing numbers. This is beyond the control of any individual in this country.

So why is there a perception amongst some individuals and groups that the jobless have chosen their unemployment as some kind of “lifestyle choice”? Especially when is it clear that WINZ unemployment benefits are nowhere as generous as some might believe.

Trying to apportion responsibility for people losing their jobs is victim-blaming  and is utterly  repugnant. Such victim-blaming is an unwelcome aspect of the human capacity for bigotry.

Why do people do it?

* The Opportunists.

It serves the purpose of some political parties such as National and ACT to blame unemployed for their predicament.

It allows National the opportunity to escape any possibility of responsibility at addressing this critical economic and social problem. And it’s a vote-winner with the next group,

* The Greedy.

For many neo-liberals who cherish the ideology of the free-market and minimalist-government, any form of taxation by the State is “theft”. And when the State hands over some of that tax-money to the Unemployed so that they can survive – they resent it. And do they complain bitterly!

These neo-liberal free-marketeers resent having to contribute their fair share to the society they live in. (Though they think nothing of driving on tax-payer funded roads; being cared for in tax-payer funded A&E Hospital Wards; protected by tax-payer funded Police; educated in tax-payer funded schools, etc.)

Greed – it does funny things to peoples’ humanity.

* The Perpetually Angry.

The uninformed, perpetually angry, people who obtain their information through TV news and/or Talkback radio. They have friends,, who know someone who has heard of a person, who apparently lives in luxury on the dole

These are people who have very little experience of the society they live in and generally have a circle of friends who validate their misconceptions.  For them, everyone is a dole-bludger; the recession happened to Someone, Somewhere Else; and everyone should be living comfortably, regardless of circumstances. Their worldview generally doesn’t extend much past their front door.

Anger – it stops people thinking clearly.

Unfortunately, The Greedy and The Perpetually Angry have no constructive solutions to offer us.

One hopes that  the National government will reconsider their decision to  cut almost $146 million from skills training.

Nor does it help when we export jobs overseas,

“Army shifts $2m contract to China”

“Chinese firm beats Hillside to KiwiRail contract”

So not only are New Zealanders losing their jobs because of corporate greed and mis-management in Wall St, USA – but our current policies actually encourage contracts to be awarded to other countries,  in effect “exporting” jobs.

Is this making sense to anyone?

Is it little wonder we have high unemployment, who need the dole to simply survive?

Because demonising a vulnerable group in our society will not achieve a single damn thing; create a single damn job; nor give us the Decent Society that we once enjoyed living in.

So far, my fellow New Zealanders,  there is precious little decency going on here.

Capitalism, top heavy and toppling – Bernard Hickey

This is must-read stuff…

Full article here.

It is worth noting that, here in New Zealand, recent tax cuts gave $2.5 billion a year to the top 10 per cent of earners and “practically nothing to the bottom 20 per cent of earners, who got 3 per cent of those cuts”.

It is also worth noting that, as a country, we are having to borrow $380 million  per week to – in part – fund those tax cuts.  That’s $17.6 billion this year alone.

Far from being a “prudent fiscal manager”, National is being highly irresponsible as it continues to woo the  Middle Class for their votes.

Only thing is: eventually it all has to be paid back. Even selling all out SOEs won’t cover that debt mountain, as we simply don’t have enough state assets left after the 1980s and 1990s.

And so it came to pass…

12 August 2011 2 comments

It is a basic tenet of belief, amongst the Left, Liberals, and Social Democrats, that everything in a society is inter-connected, whether we like it or not.  That inter-connection applies as much to macro-economics and  governmental policies as it does to how much money you and I have in our pockets to spend.

Accordingly, where there are severe social problems such as mass unemployment; poverty; lack of opportunity; an alienated, angry youth; easy availability of cheap alcohol; dislocated communities; and a general sense of despair and hopelessness – which co-exists with a consumerist society; upwardly mobile professionals; and wealth accumulated by a small minority – there is a powder keg of frustration waiting to explode.

Four days ago, the explosion happened in London.

It was predictable.

And the UK’s  “Guardian” newspaper did predict it, here,

Note the date: Friday, 29 July:  one week before the riotting exploded onto London’s streets.

The article describes severe cut-backs to various local community groups. These are the groups trying to pick up, and hold together, the fragmented pieces of a society stressed by the inhuman forces of neo-liberalism.  As unemployment escalates and even the safety net of the welfare system is cut back – wealth continues to accumulate in the hands of a privileged few.

Unfortunately, the British Prime Minister, David Cameron, just doesn’t seem to get it,

This is not about poverty, this is about culture,’ David Cameron told parliament. ‘In too many cases, the parents of these children – if they are still around – don’t care where their children are or who they are with, let alone what they are doing.

The man is either deluded, or is playing to a very angry public audience.

In case my fellow New Zealanders believe that the powder-keg of social unrest cannot happen in Godzone, it may do us well to reflect in the following;

»  We have a National-led government that is pursuing policies similar to the Conservative-led government in the UK; cutbacks; attacks on welfare beneficiaries; resisting wage-growth; opening up the economy to foreign control; and not addressing unemployment in this country in any meaningful way.

»  Tax cuts in April 2009 and October 2010 benefitted the highest income earners in the country. Those on the bottom recieved not just less in tax cuts – but found themselves paying more for food, goods, and services as GST increased from 12.5% to 15%.

»  The top 150 wealthiest individuals in New Zealand increased their wealth  from $38.2 billion to $45.2b – about a 20 percent increase.

»  Unemployment is still high, at 6.5%. Youth unemployment in NZ is at nearly 18%. The figure for Maori (25%) and Pacific Islanders (28%) remains high.

»  Government is cutting back on social services; reducing government workers via forced redundancies; and has launched an election-year campaign targetting welfare recipients.

»  Despite the devastation in Christchurch, employment in the construction sector actually  fell by 12,700 people compared to a year ago.

As Irish comedian, Andrew Maxwell put it, so very succinctly,

“Create a society that values material things above all else. Strip it of industry. Raise taxes for the poor and reduce them for the rich and for corporations. Prop up failed financial institutions with public money. Ask for more tax, while vastly reducing public services. Put adverts everywhere, regardless of people’s ability to afford the things they advertise. Allow the cost of food and housing to eclipse people’s ability to pay for them. Light blue touch paper. “

In essence, the same conditions that exist in Britain, as ouitlined in the “Guardian” article – exist here in New Zealand (though probably not yet on the same scale).

The riots on the other side of the world should serve as a salient warning to us all; society cannot endure severe social problems such as mass unemployment; poverty; lack of opportunity; an alienated, angry youth; easy availability of cheap alcohol; dislocated communities; and a general sense of despair and hopelessness  – without consequence.

With the economic mess in Europe and a near-bankrupt United States, it is obvious that the unfettered unregulated “free market” has left us all much worse off. The neo-liberal experiment is as much a failure in economic ideology as the old Soviet marxist-leninism. Both are extremes. Both are inflexible and thus vulnerable to crises. Neither offer a practical solution to the demands of society and commerce.

The question is – do our leaders have the wit to realise this?

Or more important still – do we?

And what are we going to do about it?


History, seems to repeat…

“Reducing the number of government agencies, where it makes sense, will improve the delivery of services to the public, reduce duplication of roles, and allow reprioritisation of spending to where it will have the greatest impact,” State Services Minister Tony Ryall said.”

I hope no one actually believes that nonsense. National has an apalling track trecord  in undermining agencies and damaging their ability to provide services. It’s a shame that many folk seem to have forgotten the bad state of public services when National was finally voted out at the end of 1999.

For example, ex-psych patients were reduced to living in streets and public toilets – having no where else to go, and not having any support.

In another example, on 3 April 1998, Southland dairy farmer Colin Morrison (42) died on a waiting list, awaiting a triple heart bypass surgery. His condition was listed as “life threatening” – but was still on a waiting list when he died.

We are fast returning to those Bad Old Days.

And there will be a heavy price to pay.

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On Colin Morrison (1998)

Widow says little improvement seem

GP hits out at health reforms

Died waiting for by-pass

Word today on heart list

Anger on heart op delay

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