Tuesday, 30 November 2010

Anderton is right about DB

That's right - New Zealand's very own left wing dinosaur, Jim Anderton, is right. DB's ads about the invention of DB Export following the 1958 Black Budget are totally dishonest:
Rather than beating the system, Morton Coutts was doing exactly what the Labour government wanted – building up a strong manufacturing base and creating jobs for New Zealand workers.
Mind you, Rick Giles did point this out the other day. The funny thing is Steinlager, a competitor to DB Export (and far superior in my humble opinion) takes a different spin on the '58 black budget:
1958 Lion produces Steinecker in response to then Minister of Finance, Arnold Nordmeyer, who cut beer imports as part of his infamous Black Budget and challenged New Zealand brewers to compete by producing a lager of international quality.
Either DB's spinmeisters thought they needed to counter this or just wanted to tell a little tale.

Monday, 29 November 2010

Deficit down

So, the trade deficit has shrunk - good news. The important point is the New Zealand dollar has been on a high over this period, but exports have grown. Which goes to show that we shouldn't worry so much about our high dollar clobbering exporters - interestingly forestry products recorded strong growth. Forestry is an industry where prices are set well in advance. There's a lesson there for us.

Thursday, 25 November 2010

Labour becomes Labour Lite

Labour's Finance spokesman is proposing:
  • public-private partnership for transport;
  • an "inbound transactions tax";
  • allowing private shareholders to own shares in subsidiaries of state owned enterprises;
  • not going on a spending spree, but reducing net debt and build a stronger capital base;
  • working with Iwi and "community groups" to provide social housing;
  • considering using the Cullen superannuation Fund as a "cornerstone investor in long term growth opportunities.";
  • changing monetary policy by amending the Reserve Bank Act to "broaden its targets" while retaining the central bank's independence and the current 1-3 per cent inflation target. 
It's a mixed bag. Partial privatisation shareholding of SOEs makes sense, as does PPPs for transport and the privatisation returning to the community for social housing. But the real concern is whether Labour can restrict government spending (they don't have a good record on that) and how much it will screw around with the Reserve Bank Act.

Wednesday, 24 November 2010

There goes the OE

The United Kingdom has announced a cap on "non-EU" immigration of 21,700 visas per year. To further cut immigration, they will also look at cutting family visa allowances. One of the common arguments I hear against a republic is that doing so would put the sacred "Overseas Experience" - the 'colonial birthright' as the Front Lawn once called it - at risk. This just goes to show that this is nonsense.

Monday, 15 November 2010

Key to pass Shipley tomorrow

Via Wikipedia's page List of Prime Ministers of New Zealand by term (a page I admit to starting) John Key will pass Jenny Shipley tomorrow to become New Zealand's 23rd longest serving Prime Minister, out of a field of 38. It will also mean Key passes all the Prime Ministers who were interesting 'footnotes' of history (except Sir George Grey, who is more famous for being Governor twice, and Norman Kirk who died in office).

From here it's another 97 days before Key passes 19th century Premier John Ballance, who also died in office. From then on it's another 4 years (and at least two elections) before Key will pass another National Party Prime Minister, Jim Bolger who is currently ranked 10th longest-serving. Shortly after Bolger comes Ward, the master of the political comeback, and two further big names in 20th century politics - Muldoon (7th) and Holland (8th).

However, Key will need to be in office for another 12 years and 39 days to beat the record holder, Richard John Seddon at 13 years and 44 days.

"21st-century and Jurassic wings of the party"

Jon Johansson commenting on Sunday's Q+A program pointed to the internal differences within National (to a lesser extent reflected in Labour) regarding the Constitutional review. I think the differences are somewhat deeper than that.

The "21st century" wing of National grew up with Roger Douglas and Ruth Richardson as ministers of Finance, the "Jurassic" wing grew up with Muldoon. The Jurassic wing remembers when New Zealand's economy was highly protected by both trade walls, but also by guaranteed access to the country formerly known as the Motherland. They grew up in a time when our prosperity was maintained by being Britain's farm in the South Pacific; when up to two-thirds of New Zealand's exports went to the UK.

Friday, 12 November 2010

Increase savings, increase GST

The Savings Working Group is recommending another increase in GST plus further cuts to the top income tax rate to increase New Zealand's rate of savings:
Increasing the goods and services tax to 20 percent and cutting the top personal tax rate to 29.2 percent would be fiscally neutral and have a positive impact on both private and national savings rates, according to background papers prepared by the Inland Revenue Department for the government-appointed group tasked with finding ways to lift New Zealand’s savings across the board.
As a small business owner (Web Social Ltd) I'm weary of another GST increase. I'm still working through the changes from the last increase. Of course, the lower income tax for top taxpayers is attractive, but will be howled at by the left. What the Government really needs is a glimmer of success from the last tax-switch before making further moves.

Monday, 8 November 2010

Today's most important headlines

Thursday, 4 November 2010

Money doesn't buy elections

California's gubernatorial election result is an important lesson for everyone who's ever claimed big money can simply buy elections. Ex-eBay CEO Meg Whitman ('the biggest self-funded candidate in history') spent a good part ($143 million) of her billion-dollar fortune trying to win the Governorship of California, while her opponent Jerry Brown spent just $25 million. In other words, the losing candidate outspent the winning candidate 5.72 times over. And the real kicker: Whitman was the Republican candidate, and Brown the Democrat. In cash-strapped California it didn't bode well for the Republican to be blowing a huge amount of cash on just her election campaign.

There's probably plenty of other examples, but this one is certainly the real stand-out.

The gap

Lindsay Mitchell reproduces the two salient graphs from the 2025 Taskforce report, published yesterday.

In my mind, this graph is also very important:
The interesting point here is that when Labour was last in power (1999 - 2008) they actually managed to reduce spending as a percentage of GDP up until 2004. From 2005 onwards however its been a steep climb upwards again - remember what happened 2005 - 2008? Labour basically tried to spend its way back into power, succeeding at the 2005 election with interest-free student loans and working for families. Yet between 1999 - 2004 they actually greatly increased spending on hospitals, science and education and yet spending as a percentage of GDP decreased (by the same token National had a small blip between 1996 and 1999, probably due to the NZ First coalition disaster).

Wednesday, 3 November 2010

Off the rocker

The Sensible Sentencing Trust has become the Smash the Bill of Rights Trust:
The Sensible Sentencing Trust says offenders such as Pauesi Leofa Brown who killed Austin Hemmings should be subjected to preventive detention and lose all rights currently granted under the New Zealand Bill of Rights – including the right of appeal.
Just FYI, these are the rights the SBRT are talking about:
  • The right not to be arbitrarily arrested or detained.
  • The right to be informed at the time of the arrest or detention of the reason for it; and
  • the right to consult and instruct a lawyer without delay and to be informed of that right; and the right to have the validity of the arrest or detention determined without delay by way of habeas corpus and to be released if the arrest or detention is not lawful. 
  • The right to be charged promptly or to be released.
  • The right for charges to be brought as soon as possible before a court or competent tribunal.
  • The right to refrain from making any statement and to be informed of that right.
  • If deprived of liberty the right to be treated with humanity and with respect for the inherent dignity of the person.
  • The right to be informed promptly and in detail of the nature and cause of the charge; and
  • The right to be released on reasonable terms and conditions unless there is just cause for continued detention; and
  • The right to consult and instruct a lawyer; and
  • The right to adequate time and facilities to prepare a defence; and
  • The right, except in the case of an offence under military law tried before a military tribunal, to the benefit of a trial by jury when the penalty for the offence is or includes imprisonment for more than 3 months; and
  • The right to receive legal assistance without cost if the interests of justice so require and the person does not have sufficient means to provide for that assistance; and
  • The right to have the free assistance of an interpreter if the person cannot understand or speak the language used in court.
  • The right to a fair and public hearing by an independent and impartial court:
  • The right to be tried without undue delay:
  • The right to be presumed innocent until proved guilty according to law:
  • The right not to be compelled to be a witness or to confess guilt:
  • The right to be present at the trial and to present a defence:
  • The right to examine the witnesses for the prosecution and to obtain the attendance and examination of witnesses for the defence under the same conditions as the prosecution:
  • The right, if convicted of an offence in respect of which the penalty has been varied between the commission of the offence and sentencing, to the benefit of the lesser penalty:
  • The right, if convicted of the offence, to appeal according to law to a higher court against the conviction or against the sentence or against both:
  • The right, in the case of a child, to be dealt with in a manner that takes account of the child's age.
  • The right not to be liable to conviction of any offence on account of any act or omission which did not constitute an offence by such person under the law of New Zealand at the time it occurred.
  • The right, if finally acquitted or convicted of, or pardoned for, an offence shall not be tried or punished for it again.
  • The right to the observance of the principles of natural justice by any tribunal or other public authority which has the power to make a determination in respect of that person's rights, obligations, or interests protected or recognised by law.
  • The rights, obligations, or interests protected or recognised by law have been affected by a determination of any tribunal or other public authority has the right to apply, in accordance with law, for judicial review of that determination.
  • The right to bring civil proceedings against, and to defend civil proceedings brought by, the Crown, and to have those proceedings heard, according to law, in the same way as civil proceedings between individuals.
Now most of  these rights only apply when you break the law. However, they're rights important to all of us, not just criminals. Imagine if we were talking about someone the public believed to be innocent?

Tuesday, 2 November 2010

Weldon: float the SOEs

Mark Weldon of NZX has a well yes he would say that moment:
Government decisions on privatisation of state-owned companies are a key part of “ability for the capital markets to keep working in New Zealand,” says NZX Ltd. chief executive Mark Weldon.
Commenting in the wake of the Singapore stock exchange operator, SGX’s, A$8.4 billion takeover bid for its Australian counterpart, ASX, Weldon said there was still a role for a local share market both because local companies will want a domestic venue for capital-raising, and because global players won’t pursue small and mid-sized opportunities.
Weldon does have a very good point. As the Capital Markets Development Taskforce has reported, our government holds $25 billion of taxpayer funds in state owned enterprises, including Air New Zealand which is partially listed.

Trade in surplus

NBR reports New Zealand's ongoing trade surpluses are continuing. Exports are now sitting at $41.8 billion per annum while imports sit at $40.9 billion, a surplus of $900 million year to year. While this is good news on paper, there's an underlying trend which is concerning - a quarterly decrease in exports by 2.5%. This will get worse now that the $NZ - $US is strengthening. On the other side of the equation, it will make imports from the US cheaper...