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Posts Tagged ‘state asset sales’

The Politics of Power and a Very Clear Choice – Part Tahi

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new zealand high electricity prices

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Historical Background

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New Zealanders, by and large, are not stupid.

We can recognise a rort when we see it. And in the case of electricity prices, we see it on a regular basis in our power bills and media headlines,

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2008

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Government to seek inquiry into power price rise - 2008

Acknowledgement: Fairfax: Government to seek inquiry into power price rise

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2009

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More profit than power for state-owned energy companies - 2009

Acknowledgement:  NBR – More profit than power for state-owned energy companies

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2010

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High spot prices hint at power price rise - 2010

Acknowledgement: Fairfax Media – High spot prices hint at power price rise

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2011

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Power bills set to rise up to 8pc from March - 2011

Acknowledgement: NZ Herald- Power bills set to rise up to 8pc from March

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2012

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Electricity prices tipped to rise steeply - 2012

Acknowledgement:  Fairfax Media –  Electricity prices tipped to rise steeply

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2013

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Power prices rise by average $120 nationwide - 2013

Acknowledgement:  TVNZ –  Power prices rise by average $120 nationwide

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We all know the facts and figures by now,

None of Bradford’s promises came to fruition and on 27 November 1999, Bradford lost his Rotorua seat to Labour’s Stephanie Chadwick (see: Rotorua – New Zealand electorate).

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A Bold New Plan

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On 18 April, Labour and the Greens announced a bold new policy initiative to reign in escalating power price rises. Called NZ Power, the reform would work thusly,

Key to the proposals is the creation of a central buying and electricity system planning agency, dubbed NZ Power, which would drive down power prices because of its market power and would not be required to make a profit.

It would also be the market regulator.

“It will not just supervise the market, it will be actively involved,” said Labour’s finance spokesman David Parker, a Minister of Energy in the 1999 to 2008 Labour-led administration.

It would tender for new electricity generation, or potentially energy efficiency measures, rather than the current crop of generators competing to identify the next least costly unit of new generation when demand rises.

In some cases, industrial users would be able to contract directly with NZ Power.

Power prices would be set not by reference to the cost of the next new unit of generation, but by average costs that include the anticipated price of new generation. However, there would still be a traded market in wholesale electricity, which could reflect regional variations.

Acknowledgement: Scoop –  Labour-Greens to rip up the book on electricity pricing

This new plan was the confirmation (if any was needed) that National’s grand experiment in privatisation and “competition” in the electricity sector was not working. Only  fools  (mostly those posting on right-wing, pro-National Kiwiblog) could possibly argue that the current system was “succeeding”.

In fact, even as far back as May 2009, National Minister Gerry Brownlee demanded that power generators put price rises on hold. He stated,

There is something fundamentally wrong in the way in which we’re marketing electricity in New Zealand.

Acknowledgement: NZ Herald –  Put prices on hold, Brownlee tells power companies

And even the architect of this ill-conceived “reform”, Max Bradford, was reported in May 1999 in the media as planning to regulate electricity line charges,

Enterprise  and Commerce minister  Max Bradford  is to press ahead with regulations to control electricity line charges, but sees no reason to implement regulation in the competitive end of the market.

Acknowledgement: Otago Daily Times – No case for regulation

So even National ministers reluctantly concede that the electricity sector cannot work in an unregulated “freemarket” model, and is unable  to deliver the ‘golden fruits’ of de-regulation and so-called competition.

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Carping & Criticisms

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After the press conference on 18 April, criticism flew thick and fast from National ministers; right wing bloggers;  pro-National sycophantic elements of the media, and their ideologically-wedded fellow-travellers.

On Steven Joyce’s twitter account,

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Steven Joyce - Tweet - NZ Power - soviet style nationalisation

Source: Twitter/Steven Joyce

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Judith “Crusher” Collins added this bit of gratuitous fantasy-fear mongering,

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Judith Collins - Tweet - NZ Power - soviet style nationalisation

Source: Twitter/IBID

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From Simon Bridges, this little bit of muppetry,

They may want to return to sort of United Soviet Socialist Republic of New Zealand days but National certainly doesn’t.”

Acknowledgement: NZ Herald – Power plan likened to Soviet era

It was  actually the Union of Soviet Socialist Republics, Mr Bridges, not “United” Soviet Socialist Republic. Get your Evil Empires  right, mate.

And anyway, most of New Zealand’s centralised planning occurred during National’s administration, from 1975 to 1984, under the late Robert Muldoon. Remember the price/wage freeze?

Mighty River Power chief executive Doug Heffernan, also called the plan “socialist” (by the way, is that a bad thing?) He declared,

“What you’ve just described is a socialist consumer model.”

Acknowledgement: NZ Herald – MRP chief slams socialist’ plan

To which I would point out to the reader,

  1. Heffernan benefits from a $1.49 million p.a. salary – whilst Mighty River Power keeps raising it’s power prices. So the gentleman has a vested interest in this issue.
  2. In February this year, Heffernan announced that Mighty River Power’s half-yearly profit has quadrupled; prices had risen by 2%; despite demand “being flat”. (see:  Mighty River Power profit quadruples )
  3. Saying that “Mighty River Power would not have made the $1billion investment into geothermal energy that we’ve made in the last five years … The risks would have been too high” – insults our intelligence.  Mighty River Power was built up by the State, with taxpayers’ money.  Heffernan forgets himself; MRP is not a private company.
  4. And anyway,  is it the role of  SOE chief executives to be promoting privatisation?

Steven Joyce added to the “red menace scare”on TVNZ’s Q+A on 21 April,

“By definition, it’s socialism.

“They are not just talking about the price, they’re talking about telling the generators when they can generate, which generating assets they can use, which ones they can introduce to the markets.”

The Minister said the proposed plan would also scare off investors, with evidence of this seen late last week when the market dropped.

“On Thursday and Friday, the market dropped nearly $600 million across three companies because they said, ‘Jeez, we’re not interested in this’.”

Which is rather strange… Joyce, Bridges, Collins, Key, et al, are likening Labour-Green’s plans to “North Korean economics” or “Soviet style socialism”.

But when did the former USSR or the current North Korea ever have a share market or multi-party Parliamentaty democracy?!?!

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hyperbole will sink legislation

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Could it possibly be that National ministers have no intellectual, rational response  to the proposed NZ Power scheme?

Could it be that they must rely on fear-mongering?  Which reminds me of this,

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dancing cossacks - national fear mongering

Acknowledgement: NZ History Online:  Dancing Cossacks political TV ad

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Could it possibly be that National ministers are placing their faith in free market economics – vis-a-vis the partial sale of state powercos – to get prices to drop? (Which, after 14 years is yet to happen for the domestic consumer.)

Could it be that National ministers are… panicking?!

Because as NZ Herald columnist, John Armstrong wrote on 19 April,

“There may be good reasons for the seemingly constant above-inflation hikes in retail prices. But politicians have given up explaining because consumers long ago stopped listening.

All this would suggest there is fertile ground for Labour and the Greens, who yesterday foreshadowed plans to slash power prices by setting up a new agency, NZ Power, to act as a single buyer of wholesale electricity.

National was truly gobsmacked. It accused Labour of “Muldoonism”, “loony tunes” policy making and “North Korean economics”.

National accepts that at the outset there might be lower prices. But it argues the policy would distort price signals that are so vital to matching supply and demand. That could lead to power shortages. The policy would distort and even discourage investment in power generation.”

Acknowledgement: NZ Herald:  National gobsmacked at Labour idea

Gobsmacked” is about right.

And ironically enough, “Muldoonism” was a product of the National Party – not Labour. Hilarious stuff, indeed!

This is nothing less than a full-scale retreat from market-driven political orthodoxy. In effect, Labour has done the unthinkable; it has publicly announced that neo-liberalism and it’s supposed “free” market economics does not, and cannot,  deliver all of society’s needs.

We get a glimpse  of what it must have been like in 1989 when Mikhail Gorbachev sat down with his colleagues in the Soviet Politburo and announced to a stunned meeting,

Comrades, our communist ideology and centralised economic system has failed.”

Mark 18 April 2013 on your calendar as the day that one of our two main Parties (or, two out of our three main Parties, if  Green political support keeps increasing) renounced neo-liberal free market ideology as a failure.

There is now a clear, unequivocal difference between an increasingly  right wing, ideologically-driven  National, and a decidely more-leftist – but  pragmatic – Labour.

And the public now has a clear choice as well, for whom to vote;

Option A (for the Blue Team): maintain the neo-liberal status quo; proceed with privatisation; and hope-like-hell  that Max Bradford’s promises eventually, maybe, one day, will  come true.

Option B (for the Red Team): vote for change; abandon our slavish adherence to neo-liberal dogma; and, as a side-effect, enjoy cheaper power bills.

Continued at: The Politics of Power and a Very Clear Choice – Part Rua

This blogpost was first published on The Daily Blog on 24 April 2013.

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Previous Related Blogposts

History Lesson – Tahi – Electricity Sector “reforms”  (4 March 2012)

John Key: Man of Many Principles (28 Sept 2012)

Labour, Greens, NZ First, & Mana – A Bright Idea with electricity! (10 March 2013)

References

NZ History Online:  Dancing Cossacks political TV ad

NZPA: Splitting up ECNZ expected to cut wholesale power price (16 Dec 1998)

NZPA:  Reforms aimed at business – Luxton (21 April 1999)

Otago Daily Times: Power Prices Set To Soar (12 May 1999)

Otago Daily Times: No case for regulation (24 May 1999)

Otago Daily Times: Lower power prices coming says Bradford (3 June 1999)

Otago Daily Times: Power prices to rise by up to 15.1% (29 June 1999)

Otago Daily Times:  Reforms blamed for hike (13 July 1999)

Scoop: Alliance to hold Winston Peters accountable (8 Oct 1999)

NZ Herald: Peters ‘forgets’ NZ First support for power reforms (13 Aug 2008)

Fairfax: Government to seek inquiry into power price rise  (30 September 2008)

NZ Herald:  Put prices on hold, Brownlee tells power companies (21  May 2009)

NZ Herald: Mighty River directors’ 73pc pay rise realistic – Key (5 April 2013)

Scoop:  Labour-Greens to rip up the book on electricity pricing (18 April 2013)

NZ Herald:  Labour-Greens plan could work, says Vector CEO (19 April 2013)

NZ Herald:  National gobsmacked at Labour idea (19 April 2013)

NZ Herald: Power plan likened to Soviet era (19 April 2013)

NZ Herald: MRP chief slams socialist’ plan (21 April 2013)

TVNZ:  Q+A – Transcript of Steven Joyce interview (21 April 2013)

NZ Herald:  Bernard Hickey: Power barons fail to fool the public this time around (21 April 2013)

Radio NZ: Power prices nearly double since 2000 (21 April 2013)

Other blogs

Kiwiblog: Electricity Prices

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Advertisements

Meridian Power?

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Meridian_Energy_logo

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Our household is with Meridian Energy.

If that’s the next “on the block” to be part-privatised, I’ll be on the phone within sixty seconds to change to Genesis.

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Binding future governments – a question.

A letter to the editor of the NZ Herald…

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from:     Frank M <fmacskasy@gmail.com>
to:     NZ Herald <letters@herald.co.nz>
date:     Tue, May 14, 2013 at 1:24 PM
subject:     Letters to the editor
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The Editor

NZ HERALD.

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Kia ora,

The National government wants to bind future governments to the Sky City deal for the next 35 years.

Can a Labour-Green government bind future National governments to not selling our state owned enterprises?

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-Frank Macskasy

(address & phone number supplied)

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An Occupation to remind the Government…

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no asset sales

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NZ, Wellington, 7 May 2013 – Since the anti-asset  sales march on 27 April (see:   27 April in Wellington – A Protest Against State Asset Theft (Part Tahi)), a new occupation has been set up at the foot of Wellington Cenotaph, at the intersection of Lambton Quay and  Bowen St.

A much more low-key event than the occupation of Wellington’s Civic Square in January 2012, the occupiers number only a few, with two tents, and signage;

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may 2013 - occupy - cenotaph - wellington central - no asset sales - aotearoa is not for sale

Edd (L) and James (R), standing beside their tents.

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James told this blogger that the occupation started soon after the 27 April protest march and he expected others to join in as time went by. He used the phrase,

Get an education,

Join the Occupation!”

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The Occupation supports and promotes several causes which are odf concern to communities around the country – issues which National studiously ignores, in favour of Big Business;

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may 2013 - occupy - cenotaph - wellington central - no asset sales - aotearoa is not for sale

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But the main  message is one of peaceful protest against the sale of assets which we, the people, rightfully own;

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may 2013 - occupy - cenotaph - wellington central - no asset sales - aotearoa is not for sale

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And the accent  is on a peaceful protest;

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may 2013 - occupy - cenotaph - wellington central - no asset sales - aotearoa is not for sale

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Edd and James keep the area clean and clear of rubbish and leaves at all times.  The Council can rest easy that this Occupations will not result in an unsightly mess;

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may 2013 - occupy - cenotaph - wellington central - no asset sales - aotearoa is not for sale

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They are both keen to keep negative elements away from the Occupation;

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may 2013 - occupy - cenotaph - wellington central - no asset sales - aotearoa is not for sale

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In fact, James told this blogger that they had learned from their mistakes from  the previous occupation of Wellington’s Civic Square and were adamant that they wanted no alcohol, drugs, or “feral” element associated with their protest. At all times, James insisted, they wanted to stay On Message, and to engage with the public – not freak them out.

James said that their staunch insistance on no alcohol or drugs and good behaviour had resulted in a positive response from Police and the Council. They also had full support from the Global Occupy movement and from Tainui, which was planning to visit them.

Staying On Message – and the message was simply;

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may 2013 - occupy - cenotaph - wellington central - no asset sales - aotearoa is not for sale

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According to James and Edd, their actions were for the country and for future generations. James said,

People get used to being debt slaves,” and the loss of state assets would push up prices and place our country further into into.

James is not wrong. As the chart below shows, private debt has ballooned in the last two decades;

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nz-overseas-debt-1993-to-2010

Source: NZ Reserve Bank

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When a passerby asked James,

So you want to destroy the government ?”

James replied,

No, We want you to learn.”

Amen to that, brother.

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Previous Related Blogposts

27 April in Wellington – A Protest Against State Asset Theft (Part Tahi)

27 April in Wellington – A Protest Against State Asset Theft (Part Rua)

Copyright (c)  Notice

All images are freely available to be used, with following provisos,

  •     Use must be for non-commercial purposes.
  •     At all times, images must be used only in context, and not to denigrate individuals.
  •     Acknowledgement of source is requested.

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27 April in Wellington – A Protest Against State Asset Theft (Part Rua)

28 April 2013 14 comments

Continued from: 27 April in Wellington – A Protest Against State Asset Theft (Part Tahi)

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27-april-no-asset-sales

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NZ, Wellington, 27 April – Under a clear, sunny sky and only a slight breeze,  the march pushed off  at around 2.45pm, with a police escort;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Following the police vehicle, the lead marchers, proudly grasping a message aimed at all National ministers;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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The marchers were in good spirit – knowing that they were on the side of the angels on this issue;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Labour and Mana  standing side by side. A portent of things to come after the 2014 election? (Or earlier, if this rotten government collapses, or Key has a Muldoon-“moment” and calls for a snap election.)

If the sale of Mighty River Power goes badly for the thieving Nats; or Ohariu MP, Peter Dunne realises that the government he is a part of is on a hiding to nowhere,  a snap election may be on the cards.

We can only hope/pray…

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Lots of smiling faces; lots of hope and optimism for the future of this country;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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A bit of humour from one of the protesters;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Aside from a couple of clowns who thought they were being clever (see dickhead on the left), we received good support from by-standers. Several joined the protest march – note the lady in the pink jersey on the right, who stepped off the footpath, and walked with us;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Bringing up the rear of the protest march;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Where there were smart-arses yelling desparaging comments, they were generally inarticulate boofheads. These four young ‘gentlemen’ yelled abuse, and in the process showed us the calibre of  right wing fools. No doubt they’ll become typical National Party (or ACT, if it survives) politicians;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Ngarie had so much energy, as she took part in the chants and had some highly critical comments of her own to shout. People were left in no doubt what she thought of National and our illustrious Dear Leader;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Near the end of the march; these guys may be at the bottom of the socio-economic heap, but they had a huge amount of positive, good nature and were staunch in their condemnation of National’s thieving of our state assets. When the poorest of the poor are politicised, the end is nigh for  neo-liberals and their fellow-travellers;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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The march eveventually wound it’s way up the entrance-way to Parliament. Note the senior citizens leading the way!

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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By the time the protesters had reached the Parliamentary fore-court, their numbers had swelled to around 500-700 (estimated);

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Some street theatre by Aroha Priest, giving us a glimpse of a chilling  future, where poverty has increased and homeless  street-life is the  ‘norm’;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Howard Phillips – Vice President of the Rail, Transport and Maritime Union – gave a rousing speech to the crowd, reminding us how many thousands of jobs had been lost over the last four years;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Peter Hicks – Tasmanian singer-song writer – and Marama Te Kira – local performer/songwriter  – entertained the crowd with good music, assisted by an excellent sound-system.

A fine sunny day; good music; and “giving the fingers” to the Nats – what could be a better day?

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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And Marilyn Head – from the NZ Nurses Organisation – expressed an excellent appraisal of how the s TPPA – currently being negotiated in secret –  will affect this country’s economic sovereignty.  Marilyn pointed out that, in the past, we were able to re-nationalise stressed  former-SOEs (KiwiRail and Air New Zealand).

Marilyn pointed out that the TPPA would no longer allow a New Zealand government the option of bailing out and re-nationalising a stressed ex-SOE (eg; Mighty River Power) and would tie it’s hands considerably. She raised the issue of trans-nationals suing our government; the loss of PHARMAC’s effectiveness; and secret overseas tribunals deciding disputes between coroporations and governments.

Marilyn said that the Australian government had refused to be a party to permitting corporations to sue them in  Investor-Government disputes – but that National was prepared to sign up to that accord.

Held in secret tribunals, it puts New Zealand in a very dangerous position. More foolishness from National.

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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And meanwhile, lurking in the background, was this character.  Perhaps waiting for the death of our economic sovereignty?

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Not if we don’t let it happen.

Aotearoa – it’s NOT for sale!

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Copyright (c)  Notice

All images are freely available to be used, with following provisos,

  •     Use must be for non-commercial purposes.
  •     At all times, images must be used only in context, and not to denigrate individuals.
  •     Acknowledgement of source is requested.

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27 April in Wellington – A Protest Against State Asset Theft (Part Tahi)

27 April 2013 19 comments

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27-april-no-asset-sales

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NZ, Wellington, 27 April – On a crisp, summery day, citizens of Wellington (and some from further afield), began to assemble at Te Aro (“Pigeon”) Park, in Manners Street, to send (another) message to National ministers: Aotearoa is not for sale!

TV1 cameraman, with Police and protest organisers, together planning the march route and other  measures to keep people safe during the event. There was excellent co-operation between both parties. ANFS has a solid record for peaceful, non-violent, law-abiding protest;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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From about 2pm, the crowd quickly swelled from a few dozen, to several hundred. Ages ranged from young children, to the elderly.  It was interesting to note that over half the assembled people were in their 20s or 30s.

The issue of state assets belonging to the people, has become an inter-generational matter of concern and deeply-held beliefs;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Question. Will all our assets be gone – flogged off to investors from Beijing, Berlin, or Boston – by the time this young fellow grows up?  Will he be a tenant-worker in his own country – a country that was sold out from under his feet by venal, ignorant  politicians and a distracted middle-class?

Answer? Not if we have anything to say about it!

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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From the young, to the older. This is an issue that cuts across generations, race, gender, class, etc;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Some good sounds from the Brass Razoo Solidarity Band;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Good representation from the young people of the Mana Party;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Plenty of good humour evident amongst the protest group. I wonder if Dear Leader would like this piece of art?Perhaps for a small sum donated to a worthy charity?

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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ANFS (Aotearoa Not For Sale) organiser, Ariana, addressing the crowd,

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Young New Zealanders who want what we took for granted as children ourselves; clean rivers and clean seas. Is this too much to ask from a consumerist generation?

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Simple messages on home-made placards;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Once Key and his cronies sell of our assets, what will be left for this young lady? And will she and her young generation curse us for letting it happen?

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Another simple, home-made message from a New Zealander to the government;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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A young socialist in the making? The struggle does not end here, nor will neo-liberalism triumph. Not whilst the young continue to bear the banner;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Another view of the crowd, listening to ANFS co-organiser, Francis, barely visible in the background (holding bullhorn);

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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I think a good number of people in this country would agree with these messages;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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A good message – and one all governments  should  consider;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Three staunch MANA Party supporters. Note the message on the placard. Aside from simple-minded Tory supporters, who really believes that power prices will fall, once Mighty River Power, Meridian, and Genesis are partially-privatised?

Will investors really settle for a drop in returns on their share investments? Yeah, right, of course they will… *pfffft!!*

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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A very clear message. This banner will lead the march;

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Valerie, addressing the crowd about the protocols of the march,

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Two cars  painted to promote the day of action. Using corporate-style vehicle-advertising – how cool is that?

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27 April 2013 anti-asset sale protest Wellington aotearoa is not for sale

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Continued at: 27 April in Wellington – A Protest Against State Asset Theft (Part Rua) – Where the march heads for Parliament grounds!

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Copyright (c)  Notice

All images are freely available to be used, with following provisos,

  •     Use must be for non-commercial purposes.
  •     At all times, images must be used only in context, and not to denigrate individuals.
  •     Acknowledgement of source is requested.

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Breakfasts, Brain-fades, and Bullshit

26 April 2013 2 comments

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Key met spy candidate for breakfast

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Acknowledgement: Dominion Post –  Key met spy candidate for breakfast

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The best response amongst the comments posted was this one, in response to a right winger trying to deflect on to Shearer and Norman,

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Key met spy candidate for breakfast - comment by Rodger Red

Acknowledgement: Dominion Post –  IBID

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Brilliant reposte.

’nuff said.

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