It says a lot of people get their political leanings from their parents and not reasoned thinking. Very much like religion.
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It says a lot of people get their political leanings from their parents and not reasoned thinking. Very much like religion.
Thanks for the vote Slimwin. Might I suggest that another reason for our strong dollar is not that we're doing anything particularly clever, it's just that we're not printing any extra currency when we need it, to pay off our loans and internal bills. Japan and the USA are doing just that. It makes NZ's currency an easy bet for foreign traders, no wonder they like it.
MVT - while I can remember that Maggie Thatcher had to be fairly tough and too right-wing for my liking, perhaps there was a need for some market-sorting-out back then. I remember they found out their ships were flammable in the Falklands. Britain now seems to have the same problem we do: lots of youths unemployed.
Interesting article from Oz here, all the commentators and Hawke and Keating are saying class warfare and the politics of envy are dead in Australia. One relevant fact - percentage of the Oz labour force in unions is 18%; percentage of the Oz labour force who are self employed 19%.
http://www.smh.com.au/opinion/politi...414-2htrn.html
I wouldn't think the figures are too different over here, and I'm all for more people taking control of their employment prospects and starting an enterprise if they can. But it's not easy, and govt has a part to play in encouraging the evolution of business practice. This would take the shape of positive reinforcement, a few small carrots. National tends to wave a stick instead.
Quote:
Colin James's Otago Daily Times column for 16 April 2013
Want to lift welfare? Start with a house
Last Thursday Paula Bennett was pleased with herself for getting her you-must-work welfare bill through Parliament and Bill English was pleased to confirm that you-the-taxpayer are still on course to get him a budget surplus.
The two are linked. And both are linked to a two-dimensional housing tangle.
Bennett's line: work is good for the soul and self-worth which leads to a better life, initially qualitatively (earning your income gives a sense of control of your life) and eventually quantitatively (once in work, there is a prospect of getting higher wages).
Bennett backers believe this improvement trickles down qualitatively and quantitatively to the children of those "encouraged" into work. Bennett says any work at any legal wage meets her criteria.
So she has imposed sanctions on those required to work who don't work or don't look hard enough for work.
English backs Bennett -- in fact, is a prime driver and overseer of the policy shift -- for two conservative reasons, one moral, one fiscal.
Labour's Jacinda Ardern (who comes from a conservative moral background as does English and talks of the "dignity of work") says Bennett has broken a "social contract". That contract said "those who use" "social security" (note, "security", not "welfare") "are expected to look for work, while the government focuses on job creation, training and placing job seekers into employment".
She says sanctions will force those sanctioned on to charity. She didn't add, but might have, that that is a cost on society, as taxes are. The only difference is the way the cost is paid. Costs squeezed out of one corner of an economy often turn up in another.
That fits the conservative argument on child poverty (conservative, in the Burkean sense of valuing community, as distinct from Margaret Thatcher's famous libertarian "there is no such thing as society"): that not investing in those children dumps costs on the health and education systems and eventually the benefit benefit and in some cases the "justice" system -- and deprives businesses of future able workers.
Ardern has yet to offer an "instead" in place of her "against". Some on her side of the argument despair of her but they might be premature. Ardern is aiming her substantive response for the end of the year.
Meantime, English is talking up the fiscal outlook, which is the envy of most rich countries. But that is only part of his economic story.
Take this statement in Thursday's speech: "We have reduced tax on work, savings and company profits, while increasing taxes on property investment and consumption."
Actually, raising GST is a one-off tax on savings, since from that point on what you have saved will buy you less than it would have before the tax went up. English thumped up GST from 12.5 per cent to 15 per cent in 2010. After that your savings buy you 2.22 per cent less.
That is encouragement to save? Small wonder households have reverted from a brief period of just-and-no-more saving to spending more than they are earning.
And small wonder they are putting savings into houses. English and John Key make much of low interest rates. One benefit is that businesses can borrow to invest more cheaply. A disbenefit is that savers get less from banks and bonds -- rentable houses are a better bet.
Surprise, surprise, house prices are back up above the 2007 bubble peak. It is not a bubble -- yet. But it has got the Reserve Bank's Graeme Wheeler edgy: he is not ruling out regulating banks' house lending ratios.
The government's response to the house shortage and especially to a shortage of "affordable" houses is to hammer local councils to release more green land to developers.
Small problem: developers aren't going to build "affordable" houses. The margins are smaller than for houses for the affluent and the middle classes.
Still, there is a kernel in the government's argument. Economists say that even through the boom years there was a shortage of supply, which has worsened since 2007. That accounts for the lack of a price collapse, as in overbuilt Ireland and Spain.
So there may be a case for some government involvement to get more affordable houses and rental houses built, as once governments of both stripes did, to better match supply and need. A likely spinoff would be less child poverty -- and more money to go round to pay for the jobs Bennett wants her beneficiaries into.
Meantime, soaring house costs eat up incomes. Households have reverted to spending more than they are earning. This is a long way from the sound economy English insists he is building. We are still one of the most indebted countries on earth. The economy is still badly distorted.
So, while Bennett and English might get the government books nicely in order in May 2014 in time for re-election six months later, that is only part of the story. English will need the whole of a third term to demonstrate the real economic change he said he was aiming for at the start of his first term.
-- Colin James, Synapsis Ltd, P O Box 9494, Wellington 6141
Ph (64)-4-384 7030, Mobile (64)-21-438 434, Fax (64)-4-384 9175
Webpage http://www.ColinJames.co.nz
Another article showing just how little faith National has in SMEs. We're going to be fed some hype about increasing our export earnings in the budget. And the way we're going to do that? Spend a bit less than $40mill a year on some tourism ideas, because we'll be awash with Chinese tourists soon (OK, that may be right), and we'll also be encouraging more foreign investment. Nothing in there about encouragement for our existing small businesses. http://tvnz.co.nz/business-news/budg...agenda-5408108
We used to have a good description for constant whingers in the Army..."You'd moan if your ars* was on fire and you'd moan if I p*ss*d on it to put it out".
Seems very obvious that the value proportion of total exports from SME's is tiny and also the potential expansion of this tiny share is also tiny.
And we are bound by International Agreements we have signed up to from subsidising exports. Or are you advocating NZ becomes Argentina?
And I thought I was shining a light on the govt's actions (not their words). A lot of that $40mill a year will be spent on inbound tourist advertising overseas.
Labour's R&D tax credits for example, aren't subsidies. They are inducements for businesses to create new products ready for exporting. I just exported some new gear off overseas yesterday, in this case the NZ owner of the IP has had no govt incentives, but clients like that are a rare breed. I don't think I'd have held that customer if I was as negative as you think. What are you doing to help our exports?
The National Govt has led the way, business responded in 2012.
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10878185
But as an aside, I know of one deal done in 2013 that was nearly the size of all the M&A in the year before, so maybe there's a turnaround happening.
I like the sound of cheaper power prices, so the Labour-Green policy idea released yesterday caught my attention. It was noted by the press too.
http://tvnz.co.nz/politics-news/labour-green-power-plan-attacked-truly-wacky-5410437
Predictably Steven Joyce and Simon Bridges (and Business NZ) had some specially chosen sound bites to scare people off this 'wacky' idea from a Labour-Green coalition. It is far from a crazy policy.
Hydro power is being made for 0.5c a kWHr, we're paying over 22c + GST in our homes for that same power, at times. We have a fair idea we're being ripped off already, and this will simply get a bit of that margin back. Prices can go back up again when we can all afford it, and when we need to expand the power supply grid. At the moment they're considering mothballing all of the older Huntly power station, there's one good way to bring prices down, because it was used to set higher prices. It's a bit scary in terms of continuity of power perhaps, at this stage.
And I quite liked Colin Espiner. He's not putting all the facts straight though. Some of the following comments spell it out. Rio Tinto get to negotiate for their power rates, and they're about 25% of retail prices. This model could easily work. We need to be capitalistic in areas where we can compete, and socialistic where NZ's population, resources and geographical isolation make us uncompetitive.We need to be capitalistic in areas where we can compete, and socialistic where NZ's population, resources and geographical isolation make us uncompetitive.