By Bernard Hickey
In many ways Budget 2015 is one of the most counter-intuitive of the seven that Bill English has delivered as Finance Minister.
A centre-right Government that is regularly accused of looking after the big end of town and ignoring the plight of the poor has delivered a Budget that takes from the rich and gives to the poor.
The contrast is most stark in the three big surprises in the Budget and in the underlying result - a significant deficit and a small surplus in 2014/15 and 2015/16 when two surpluses were promised.
To make sure even that small surplus was forecast in 2015/16, the Government decided to stop giving the middle classes one of the suite of middle class welfare payments initiated in the mid-2000s (interest free student loans, KiwiSaver and Working For Families).
The unexpected move to drop the NZ$1,000 kick-start payment for KiwiSaver will save NZ$175 million in 2015/16, which is now the crucial first year of surplus for the Government. Without that cut in spending, the budget would have been in surplus by NZ$1 million. That's not just wafer thin or even a rounding error. To use John Key's analogy last month, that would be like trying to land a 747 on a speck of bacteria on the head of a pin.
Then there's the new customs levy of NZ$6 for departures and NZ$16 for arrivals. Almost half of the 5.5 million arrivals and 5.4 million departures in the year to April were New Zealanders travelling overseas for holidays, on business and for family reasons. These travellers are self-selecting as wealthier than the rest and are essentially having to pay a new tax raising NZ$100 million a year.
Without this new tax on travellers the Budget would have definitely been in deficit for two years longer than National promised.
Yet the Government was still able and willing to spend NZ$200 million a year from 2016/17 on increasing the incomes of poor families by up to NZ$25 a week, both through the benefit system and Working For Families for those families earning less than NZ$36,500. This was effectively taking from the rich and giving to the poor, and doing it instead of running Budget surpluses.
So why is the Government doing it?
Bill English is the driving force behind the Government's investment-led approach to trying to reduce the long term costs of poverty and is building up a powerful and also counter-intuitive argument to convince centre-right voters to spend money on the poor.
He argues that spending a little money now to educate, stabilise and reorientate a single mum or a young unemployed person could save a much bigger sum of money later on.
On Budget Day he used the example of the 600 new children a year that come to the attention of Child Youth and Family Service and who have been supported by benefits for 40 months and have had one parent in contact with corrections.
English said that by the age of 21 at least 40% of this group would have been on a benefit long term and by the age of 35 a quarter would have had a stint in prison.
The Government's actuaries and its improving data miners say the average cost of each of those children is NZ$320,000 and some will cost over NZ$1 million.
So any successful attempt to invest in mentors or new training or better housing or simply add a little more income to reduce deprivation could actually save the taxpayers over the long run. It's what Robin Hood would have said if his band of merry men had been a bunch of actuaries.
It sounds boring, but it's the current Government's version of compassionate conservatism.
But Bill English and his own 'Little John' on the ninth floor have only scratched the surface.
The Finance Minister acknowledged this week that the gap in incomes between those at the bottom end of town and the average was as wide as he wanted it to become and there was more to be done. The benefit increases announced this week were the first since 1972 that were not linked to consumer price inflation.
There is a lot more investment needed to narrow that gap and the long term payoff could be substantial.
All that's needed is for Robin Hood, Little John and his band of merry actuaries to push on with more of the investment-led approach.
It would seem counter-intuitive, but perfectly rational if Budget 2015 is anything to go by.
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A version of this article also appeared in the Herald on Sunday. It is here with permission..
76 Comments
The budget took from 'middle' and gave to the poor. The $175 million for kiwi-saver translates to 175,000 people not be eligible to a $1000 kiwi-saver grant in 2015/16 that the previous generation were eligible for. It is another rung in the ladder kicked away from young kiwis as they reach adulthood.
The $25 extra weekly payment for beneficiary families is also part of a package whereby mothers are expected to take on 20 not 15 hours of employment and from the age of 3 not 5 of there youngest child. So there is an element of 'deserving' poor to this Robin Hood grant.
Of course pensioner beneficiaries do not get one-off Robin Hood grants there benefits are tied to wages not inflation so they get regular real increases in their benefits.
The further problem with the budget is it continues the 'too little too late' theme of addressing the housing crisis. John Key still will not acknowledge that it even exists. Rents and certainly property prices have increased far greater than inflation or even wages. For instance median 3 bedroom rentals in Christchurch since 2010 have increased $130 a week with no corresponding increase in the top rate of the accommodation supplement. This is $130 a week extra the 'big end' of town gets from the incomes of the poor end.
My advice to Robin Hood is to aim a bit higher in the food chain and target wealth not income when he takes from the rich and gives to the poor.
Nationwide median increase in rentals over the same period $300 to $360 using interest.co.nz charts. So a 20% increase which would be greater than inflation or wage growth for the same period.
Sure Christchurch is unique but it shows that the costs of earthquakes hit the poor end of town more than the big and the Government has not been interested in any Robin Hood type redistribution effort.
Compassionate conservatism is a temporary device National is using because Labour have been more effective as an opposition party this year. All it shows is how National will 'spin' and twist to keep power.
Long term National are still talking about restricting government spending so they can give tax cuts.
There is no question that the new airport taxes take from the middle and poor and give to the big end of the country houses. In an era of budget airlines i wouldn't automatically assume that all lower income households are priced out of international travel. But the beneficiaries of this tax, as Eric Crampton points out, are the owners of kiwifruit orchards and other horticultural businesses.
For goodness sake if it werent for our biosecurity we would all be in the poorhouse. The meat companies I supply lamb and beef to pay plenty to be checked out before the product leaves NZ shores. Why shouldnt the travelling public pay the same? Meat Inspection and Export licencing is no cheap deal. Yet one traveller with foot n mouth in his pork sammy could wreck all our hopes and dreams.
I know what you are saying, Belle, but the primary reason for having such expensive biosecurity measures in place at airports is for the direct benefit of the horticultural industry. Until now we have funded the service through general taxation. So your argument about the general good was reflected in that arrangement. This new tax applies only to travellers almost all of whom come from the middle and lower income ranges, it is regressive because it is a fixed rate tax but the beneficiaries of the service it funds will be horticultural company owners.
In my book that is taking from the less well off to give to the better off and is a counter-example to Bernard's essay.
Kumbel I am all for making the rich pay. But you know I dont get this poor traveller thing...it seems to me if you have enough spondalees to go international you arent scraping the bottom of the barrell. User pays. Its not just hort...we dont want all sorts of things here. I am sure like the meat industry to get export verification hort pays through the nose.
Wow. No direct benefit eh. Hmm like to see if mr n mrs suburbia could afford that trip to fiji when the export earnings completely fizzle after a foot and mouth outbreak or that pesky fruit fly establishes itself. The chinese were exiting with branches of our apple trees so they could take our apple markets. What if some little bug comes in that wipes out our pinus radiata. Its damn boring to the average travelling punter. I dont give a rats how boring it is. How expensive it is. Its what we have to do to stay a 1st world country. That boring income from trees and apples and meat and avoes does a very fine job of paying for hospitals and schools and policemen and teachers and nurses and roading and and and and Mr and mrs suburbias trip to Fiji
Ok just so we are clear I am am also a rural dweller. I absolutely get everything you are saying. The issue here is not just who should pay but also whether this is a "Robin Hood" budget. My point is that this levy/tax takes from Joe Sixpack and gives to the owners of horticultural businesses.
The main point here is that if there were no horticultural industry relying on our isolation for its wellbeing there would would be be no requirement for a biosecurity service. The profit\ability of our horticultural sector depends on keeping pests out., fine, but who is responsible for the costs of doing so?
Yes but there is a massive dairy industry thst would be hamstrung with foot and mouth. Next down the rung is beef lamb and venison. With all the feral pigs deer and goats getting f & m gone again could be a mission and a half. Next I guess is something like rabies. Dog in handbag anybody??? OR private jet. You seem caught up with the rich pr**ks of the hort industry. I think its about NZ staying NZ. We have no snakes, no yukky spiders, no rabies, no foot and mouth, no qsland fruit fly, and the biggest risk to this is the looney traveller.
I am really only talking about the biosecurity screening in airports. Sure we get some wider benefits so funding the service via general taxes can be appropriate. But fruit fly is a good example. We simply wouldn't screen for it if there were no horticulture industry.
Travellers are not a risk they are a threat (technicality from risk management protocols). A risk only comes into play when there is a potential impact. No impact, no risk.
You can be sure that if our horticulture industry had only started in the last 30 years and they had gone to any of the governments of the day asking for more screening at airports to protect their industry they would had a levy imposed directly on them in a flash.
And BTW, if the point is to protect our country and travellers are to blame, how come we are imposing the new tax on them when they leave the country?
Say you have a bog standard dairy farm. One day a townie moves out onto a lifestyle block across the road.Two months later your new neighbour is complaining to the council about noise at ungodly hours and all sorts of other problems they have with you.
According to you and cowboy it is only fair and right that the council order you to stop being a nuisance to your new neighbour and to spend money to mitigate the nuisance you are causing.
My stance is that the horticulturalist is fully within their natural and legal rights, and that they have no link to the travellers (except for the very rare expert consultant or sales processor).
The horticulturalist could continue indefinitely with no problems whatsoever.
The traveller makes the choice to enter the country, for whatever reason.
This is a process that creates a risk to the horticulturalist (etc, being a single case example representative of a similar groups sharing that characteristic). The horticulturalist (with a very rare exceptions) gains nothing nor has any say in the travelers activities or decisions.
therefore the threat and risk is very one sided: The travellers threaten the security of the horticulturalist, yet the horticulturalist gains nothing and receives not indemnity from the travelers.
we can not say "the horticulturalist benefits" because the horticulturalist is purely within the enjoyment of their normal rights and gains nothing that they wouldn't have if the travelers weren't present.
The traveler is a real threat however, and they, while enjoying their own legal and natural rights, are systematically exposing others to threats (increasing risk).
Therefore it is IMO up to the traveler to remedy the issue that they cause.
One option would be that each traveler pays the horticulturist a portion of what it would cost should an outbreak occur - this is what is done in banks and financial circles, all those using a service (ie borrow from a bank) pay a little extra in interest fees to cover the damage from those who default. Or in retail, where the price of bad stock, customer damage and shoplifting must be met by all those shopping legitimately.
However such a action would be prohibitively complex and unwieldy in bio-security matters.as the actual cost of an outbreak is prohibitively enormous (probably more than the travelers whole journey when split between them) and ongoing (wipes out years of compounding improvement and destroys non-fungibles for many years into the future, destroying not just stock but capital holdings), and years of ongoing cleanup (like the auckland moth or bee mites)
As it would likely to affect many private businesses and not all equally making compensation problematic.
We could be like the financial institutions and charge the travelers for the risk they introduce and pay that directly to those affected, and leave it to those at risk to manage their affairs accordingly. But considering the size of the risk involved, it would mean more _profit_margin_ would be made in "being threatened" than is made in the actual produce!! Also it would present a moral hazard, that by deliberately introducing problems, the perception and the payment could be profitably increased!
So we could pay the travelers premiums to an insurance company, as they are experts in consolidating risk especially when presented in piecemeal manner to statistical at risk targets. However as Christchurch has _proven_ they are far more expert at gathering premiums for the risk than actually paying out (let alone fixing the problem.)
Sadly government is similar, often collected far too little, paying it to their agents, then having nothing available but bureaucratic doublespeak and media campaigns when problems occur.
However I hope I have clearly stated why it is the _traveler_ who needs to be paying and why it isn't _income_ or benefit for the threatened.
I'll leave it as an exercise to the reader to why it might be more efficacious in grabbing them when they're rushing away from the country on their way home than to charge them up front when they're considering the cost of touring our delightful shores and impoverished peoples.
If you have a bog standard dairy farm... and you set it up in the middle of town, when the town is already established and operating as a normal town... I would expect the dairy farm to comply to not annoying the neighbours.
If you have a bog standard dairy farm... and a bunch of 1000 townies set up new houses around you, then they can bitch at the council as much as they like I would expect the council to say, you moved next to a bog standard dairy farm which is operating within normal bog standard dairy farm practices therefore as the person choosing to be there it is your townie choice to accept that is part of the location you have chosen. If as a townie you didn't realise that the wind will change direction and blow stink from silage or effluent areas then that is your townie failure at due diligence for the location you chose. If that is too much for you then move someone more suitable for your taste.
If said bog standard dairy farm decided it was going to start running a horse abattoir on the property then I would expect that the recent addition provide no more nuisance than the dairy farm, and that it be expected that the farm/abattoir owner would, if they are a decent person, see improvement on the base level during the development (ie to reduce nuisance even if slightly).
Again simple process of the first person enjoying their rights to normal existence.
A second party, even when within their own rights, should not infringe on the first persons' enjoyment )certainly not without due compensation).
IMO the law should protect and serve this principle, where in truth the law plays the rort and collects fees for itself and its costs/agent in violating that principle. It _steals_ the rights of the first person, to make the second happy in the current system. Which is not surprising since it is the State and its agents which profit from such a rort, and only the first person is constantly injured and is prevented redress, as it is the mechanism of the law which is used as the tool to cause injury (ie rort).
What "natural and legal rights"?
If you follow that exact principle I should be able to charge the airlines every time they fly over my house and disturb me.
Anyhow this discussion is getting a bit skinny so time to wrap it up.
The only point I was trying to make was that the government wanted to beef up biosecurity. To fund it it could have imposed an industry levy, upped general taxation or imposed this levy on travelers. In choosing the last option it avoided imposing taxes on businesses and passed the costs entirely to Joe Public (who in just sheer numbers will be mostly in middle and lower income brackets). That is not a Robin Hood move as Bernard (remember him?) was claiming.
Ronald Coase won the Fauxbel for Economics in 1991 for his seminal work on exactly this kind of problem. Check him out in Wikipedia. Once you get your head around the fact that it is very rare that one party imposes harms unilaterally on another party it makes it easier to have sensible conversations on topics like this.
If you were there before the airline, then yes.
If the airline was there before you, then no.
If the airline was to remove the planes or act differently because of Johnny-come-latelys personal preferrence then they are reduced , thus the have partial case to claim in the reduction (damages) you are causing them.
If you were innocently enjoying your rights and then start something which infringes on that enjoyment, it is their decision which has reduced/damaged you. The exact remedy would be up to the pair of you - I receommend that the seek redress for the inconvenience (possibly through rehousing or cash offer) before they buy - otherwise they should be grounded (or at least silenced).
I will check him out but often I find such things to be self-serving government bs. clearly in the case of the traveler and the horticulturalist, the horticulturalist has done no change nor made no act - thus assigning them "benefits" is simply bs paper dancing. It is also why I said earlier to Brendon to put HIS money where his mouth is, far less bs and paper games that way because it "unilaterally" comes out of your pocket or it doesn't.
Government has duty of care to maintain biosecurity.
Who pays for that? Horticulturists? Well they don't actually benefit from beefed up biosecurity. On the paper dance it appears so but in reality it is not - following the vector analysis system (which is used in fluid dynamics, an equally unforgiving, inflexible master) illustrates it very clearly.
Horticulturalists are fine with _zero_ incoming traffic, as long as they can get their product out to market. That is the baseline for the Horticulturalist.
who needs the traffic? tourism. government. public.
Where is the threat pressure coming from? Not the farmer/horticulturalist. It's from the incoming traffic.
no traffic = no threat, which is 100% fine for the horticulturalist.
where the self serving bs starts to come in is when the government declares that traffic is desirable and the norm, and must be maintained. this serves the governments own interests, but clearly doesn't relate in the slightest to the horticulturalist (who neither needs nor wants nor sees the traffic).
therefore to say the horticulturalist has a "benefit debt to others" is like saying others owe me a "benefits debt from not punching them in the face". the normal is not for me to do so, but they are the ones gaining the benefit from the proposal, does that mean they should be paying for that benefit??
Generally you would say no, because I have isolated the personal vs the government stance. By changing government action to personal action, should not change the responsibilities, unless you're writing a special case law for government to act in a privileged position. which is very common for people who draw income or have personal profit in the governments actions.... It's also common for people who like to game the system by playing an appeal from authority as a way to avoid personal responsibility for profits or gain by blaming their interests on "it's the law" or "its the public good".
To answer the first question : natural right to enjoy your life without interference from others, and that prior claim have precedence.
legal right to enjoy your legal ownership and rights without undue interference from others and that you give same to others with similar legal status.
Coase <- Nature of Firms. ignores market dominance and price setter/follower behaviours. Noticably that a large firm that can dominate the market thus having influence which it can use to be a price setter to pass on prices that followers cannot pass on. This we see in the likes of Apple, Amazon, Fonterra - all very _inefficient_ in the market but any attempt to grow smaller firms into the inefficiency space has to compete with their dominance, without the ability to pass on costs.
Social Cost. faulty in real world situations.
If a rancher has straying cattle then he is negligent in duty of care over those cattle - should the farmer or hunter or townie be free to fill his freezer with the stray cattle?? I think the rancher will say no because the cattle belong to him. That belonging bestows a duty of care. Should the cattle be fed on unclaimed public land (eg wilds) then the animals would be considered wild or feral, and the rancher have difficulty proving just _why_ he believes the cattle actually belong in some way to him. Sure he paid $20 to purchase a calf, but the grazing/growing/added value was provided by someone else (or in this case of wilds, no-one else). This is the importance of removing "public ownership" and tracking "private ownership" - the rancher owns $20 of the cattle beast...but if he has never exercised _responsibilty_ of ownership, that would be the sole extent of his claim.
When it comes to the fence, we must ask why it was needed. Clearly the rancher should have already had a fence there to stop his cattle from straying from his ownership - as he has a duty of care over those animals, as the owner.
Likewise the farmer has a duty of care with his crops...that they should not wander over the fence line either. Not much of a problem...until you consider sowing and spraying, and monsanto vs organic farmers. Clearly the farmer needs a different fence, or procedures for his duty of care towards his neighbour.
In no case does "what is it going to cost me" become a factor.
Making a law which puts "who benefits or whose cost is more important" is therefore completely corrupt.
To whit, a fence for the farmer might cost $10,000. Yet a .303 round is about $1.50.
Following Coase's logic we should just shoot the rancher, as it is far more cost effective.
But that ignores the duty of care to my fellow citizens - and the natural law, that the rancher might be faster on the draw.
the clear answer is that the cattle are the causative agent - therefore duty-of-care for owning cattle is to be able to keep them within what is legally yours. This is a cost of ownership of the cattle.
The counter is that the cost of ownership of the crops is not to spray poisons on the cattle (or the waterways), as clearly the cost of ownership of a crop does not include much in the way of fencing.
One could claim that the rancher has a right to let his cattle wander on to unclaimed land. If there is no objection then that stands. However. It is rather obvious that should unclaimed land become claimed land, that extra privilege the rancher enjoys no longer exists - but it is an extended privilege due to the land being unclaimed - if the ranch claims he has been reduced or damaged by the loss of the use of _unclaimed_ land, he is effectively making a _claim_ of enjoyment of that "unclaimed land".
He cannot have both claim and unclaimed on the same article.
If claim, then he needs to prove he is responsible for it's ownership (where previously this it officially denied, hence the term "unclaimed").
If unclaimed, then he cannot insist that he owns the enjoyment of its rights, and while he had extended privilege of perhaps not needing a fence, the unclaimed is now claimed and his responsibilties which were lax before are, as owner, needs tightening as he is the declared owner of the causative agent.
Just as if the farmer, having accidentally planted crop in an unclaimed boundary, could harvest and sell the produce... could not complain should the rancher graze the portion lying within unclaimed land - as the farmer has duty-of-care to work only his own claimed land.
It takes from those performing risky choices (foreign travel). And it is used to limit the risk they produce.
The horticultural industry only "gain" in that they are limiting to the exposure that those people themselves are generating.
That I do not smoke is not your benefit - even though you have a risk from second hand tobacco smoke. This can be demonstrated by attaching a token to the activity. put a red "risk/debt" token on the risky activities. Now place blue "gain" token on the benefits/added value. Place "green" also profiting token on the 'side benefits'. To be complete put a Yellow "price follower/affected party" on the connected people (eg other passengers, staff involved, support services who will be affected indirectly ), and white on the services profiting (eg suppliers, government officials).
Start the model in motion, observe the vectors. How do the "green" horticulturists/non-smokers gain from the activity? Yes they're link but if they have to pay their tokens to the point of action, who do they replenish their tokens? Do they get them back from travellers, from service providers?? no.
However arguably the middle who earn a reasonable wage do not need such a "bribe"
Housing crisis, but where is this crisis? only in the expensive areas? ie how many areas around NZ ie outside Auckland actually grew little or lost value? in the last 2 or 3 years, most? I dont disagree with better targetting and especially targetting areas that have gains that are un-taxed or dodged would seem the fairest.
Steven what middle class 'bribe' are you talking about?
The Kiwisaver grant was an important part in a saving scheme which addressed a long time problem in our economy of not saving enough. KiwiSaver has been a huge success with an uptake far exceeding expectations. But the more governments like this one tinker around with it, the less faith people have in it. Putting at risk the change to kiwis saving more.
How are airport taxes a bribe?
Adjusting some benefits for families so they are closer to other benefits to pensioners seems pragmatic not a bribe. In any case benefits are for the poor so you probably didn't mean them as middle class bribes.
actually NZers are saving too much (not enough stimulus across the counter).
The government has realised the funds now have critical mass and the taxpayer has purchased enough market share to get the funds big enough to pay the fund managers from normal business. It is even possible the government has realised that taking peoples' discretionary money for taxes, and putting into unusable "dead" accounts to the tune of $1000 per person for the next 30 - 50 years really isn't going to stimulate the economy enough to pay a reasonable wage for the majority of the country (Kiwislaver profits and government profits only appear in big cities). This reduction in disposable wage = less spending = less businesses = shrinking provinces = less tax & less jobs & no capital for development;
All NZers are saving too much? Or is it just a minority (same as the rest of the world) that are hoarding too much?
The 10% - 20% that hoard the worlds "wealth" and constantly want to take more, that influence and manipulate the so called "market" are sucking the lifeblood from the economy. Much like an engine needs oil to circulate, the economy needs money to circulate. Without lubrication the engine eventually grinds to a halt.
All NZers.
The lower end save by expense reduction. For a wealthy person this would be equivalent to living at work and not paying rent, or renting out your rooms to flatmates without declaring it.
By forgoing certain common items and buying the cheapest and nastiest (or by stealing) they effectively reduce their outgoings... but that means that we aren't seeing the business revenue or the tax revenue from their economic contribution. Because they have so little actual cash income, they are saving much of what they have.
People higher up the scale make more money but it goes into investments, kiwisaver, education, or taxes (taxes which pay for a NZ super pension that they in turn hope to collect when old). All this skim is again, revenue which can't be spent into wage/business creating activities. the last thing we really need is more people pouring more money into existing housing stock !
That is the danger of a high compliance expense economy. The amount of savings reserves cuts heavily into what can be spent to keep the economy going, and without the spending creating opportunities we end up with a stagnation effect - that there's no money to do anything new, or to waste on training, and the cost of credit outstrips the return on investment (it costs earnings to employ a fund manager, it costs nothing to eat Budget brand baked beans and put your kids in a cheap damp room)
Steven the housing crisis is in the whole country. It is getting worse at a rapid rate of knots in Auckland but nowhere in the country has affordable housing. The whole country is above historical median multiples that prevailed for most of last century. Qualitative poverty data on over-crowding or poor quality housing -cold/damp/disease causing can be found all over NZ. Rentals in some places like Christchurch have exploded.
Most kiws do not want to look at how the other half live. Providing decent affordable housing is a social justice issue not a free market or environment issue which have been the two poles of the housing debate for too long in this country.
Maybe Brendon we have always built crappy unhealthy houses. It's our culture and traditions that are the problem not money. For example because we don't understand investment we build for the short term with very high lifetime costs.
Building at high cost because we are short of money is dumb. But it is what we do.
Compare a german farmhouse. 400 years old some of those, providing high utility, at low yearly cost, highly refined for their environment, and adaptable for modern living as that changes.
"Building decent affordable houses would be a good start."
Sounds excellent... shall I send YOU the bill then? Sadly your' credit isn't good so we'll expect the money in escrow before we start. Really would like to get this roof done before it develops a sizeable leak ... I'm also doing the floor insulation that was never done, but while you think it needs doing, I think it's reasonable to wait until after the risk of roof problems is _paid_.
Everything is always easy until (a) you have to do the work, and (b) YOU have to pay for it.
So lets start talking only what _you're_ willing to pay for, personally, not what you are willing to spend of other peoples' labour and savings, eh.
Typical.
You get told to put your money where your mouth is and you RUN RUN RUN.
You're all good with the lies and bull and spending others money (that they don't have) but when it comes to ACTUALLY PUTTING UP YOUR OWN DOSH.... you run.
I have no "interest in society" because it creates _lying_ bully boys (and girls) who write laws and "community contracts" that _steal_ from others. The first rule of politics is to isolate yourself from responsibility.
Your "theory" is bullshit.
It is demonstratably bullshit.
You want the better houses... yay lets all EAT CAKE.
But when it comes to paying for it... not your problem, Mr Keynes just walks away not answering the question about how we pay for all that spending....
And I "bother" with public debate because I have facts, I have the hands on experience and information, AND I have good knowledge of the principles, AND I can highlight when Bullshit artists are talking bullshit - because there's a lot of other townie/society types who have had the easy life and gravy train of others paying the way that don't know any better ... and to them your bullshit lies actually sound good.... they sit around the table going "oh yes they should have the brioche"
... I have to doff my 10 gallon Stetson hat to the cowboy , it takes a fair bit to ruffle Brendon's feathers , because he is a professional in dealing with nit-wits 'like us , he's a fully trained psychotic nurse ....
Or .... ummmm .... or is it .... Brendon is a psychotically trained nurse .... ahhhhh .... hmmmmm ??????
What we could do for Brendon, is put him on the same standing as the landords (and farmers and small business owners) whose money he's spending in fair pursuit of better standards.
First up he's a nurse? They tend to work on a patient-bed or patient-room basis. Normally for insurance of government paying client. Wel the private owners he's aiming don't have guaranteed government payment, so we'll have to make sure the patients pay.
Next up small businesses, landlords, farmers, all supply their own capital.
Therefore nurses will have to pay for ALL the beds and room fitouts (excluding medical wiring and things that go beep ... we'll bill those to the hospital and doctors - just like councils provide infrastructure and provide services in return for rates.)
the nurses who get paid for working those beds would have to pay the hospital some rates money for the infrastructure and a collective expenses (damn forgot what you Orclanders call it) for the room space they use.
Of course, some nurses might want to form a collective company or coop for the beds and assets, but in the end they're individually and collective liable for each bed-service being provided.
If the beds aren't up to hospital standards or if the patients can't afford to pay for a bed, then the landlord...I mean nurse... would have to foot the bill.
When the patients collective and the government introduce better standards for the beds... then the nurses will have to pay for it themselves, after all they're the ones receiving money and getting the benefit aren't they?
Oh, while I'm at it....
Kumbel are you a "user pays" person?
I was going to bring this up with the chap the other day who said he wasn't, but like most of his ilk he ran for the hills as soon as he was called on his nonsense.
It's just I'm about to go to MacDonalds for some late lunch, and I'm looking for some non-users pays people to have lunch with me. The offer and opportunity to eat some MacDonalds lunch with me is available.
I'm just wanting to know where to send the non-user pays bills. y'see.
they've had equal opportunity and offering - true they're not here and probably working and probably can't even stand MacDonalds.... but like the non-user pays, much of the stuff I'm not there for, probably working, and probably disagree with the whole process.... but the non-user pays crowd tell me I get to pay the bill since I had the "same" opportunity to join in as anyone else (and thus I _should_ get in there and consume, "to get my money's worth".
so anyway... Who's coming to MacDonalds with me to get their money's worth? And who's just getting a bill for it? (I believe councils also reserve the right to add debt collection and location costs...)
Bah the guy doesn't even get that poor people don't go around saying "ooh lets find the nastiest house we can live in, and the one that makes our children the sickest".
Poor people go around finding the best that they can afford.
His idiotic scheme is to make the ok cheap houses expensive and even the not so ok houses more expensive than the poor people can afford. All at the landlords immediate expense (and the banks joy). The landlords also have their own business and problems to deal with, especially the smaller and newer ones..... the ones most likely to have the lower end properties.
So then the poor end up crammed into the most dreadful accommodation, and everyone elses rental/living cost goes UP leaving even _less_ to get the economy moving forward (spending, business, investment, research).
The absolute last thing we need when times are tough and money hard to get, is to pour MORE into old houses !!!!
As one of those "other half"... I have to say; you can only have what you can afford.
As I'm scrapping the rat and mouse droppings from the cupboards as I'm moving out of this current residence, I'm considering just what would be involved in fixing that problem (this property has a lower floor clearance and less feral cats to keep rodent population in check). Could I line the shelves back, sides and floor with stainless steel to keep them from chewing their way in. Rip open several of the walls and put some plaster of paris or steel wool on the bottom timber to slow them chewing their ways up the walls.
I have to do some more batts on the new place (the previous owner only did the kitchen and what could be seen from the manhole) ... I'm already saving to replacing the walled tin piece they put in as a flat roof (with no bitumen or insulation) with the new LBP legislation and extra scaffolding if I do it legally it will probably cost 30,000 instead of the 10,000 I could do it for (and do a better job). How many of us "other half" can afford 30,000 to replace a roof? that's a lot of interest and tax and food etc for 30k of disposable....
You could rodent proof your house if you want but don't forget to never leave a door open, ever. And field mice are more prevalent where there are, well, fields, just goes with the territory. Most effective thing is a trap and peanut butter, and like dishes you just have to keep doing it
I can put up with them through the house, it's in cutlery, crockery and pantry that is the problem.
They also like the old meat safe because the's where I put the microwave, and the back of the stove.
They also love the bottom of the fridge and the Fisher & Paykel Dishdraw, especially the latter because for some reason F&P didn't put in it a steel skirting (box), so all the water tubes are exposed so when the rodents die of poison they always head for water. Stinks for a week or so, but it's better than having to try and work on that damn dishdrawer, typical NZ 80% of the game fitness, sits nice, looks nice, easy to work, 150% bitch to repair/service.
They chewed their way into a bucket of rodent baits and ate the lot...but they did keep the population away for a few months.
The worst part about the cutlery/crockery is that rodents don't have bladder control, they constantly urinate as they move. So generally anytime even one has been in the food equipment places it's all dirty. Which is another reason I get so pissed off when DairyNZ/fonterra/MPI/QCONZ/AssureQuality demand I have to fix the cracks in the concrete/yard at the dairy shed.... heck I have to live in a rodent infested home and can barely afford to put insulation in the roof (yes I did that), yet everyone else gets the f...ing royalty treatment of no cracks or damaged concrete within _meters_ of the plant. My food areas are rodent infested dirty... yet they're worried about stuff that isn't even a food surface (it's an animal walkway/toilet). Don't even get me started on the royal townies complaining about not being able to swim in my _drinking_ water....
Brendon you obviously think the grass is greener on the other side?!?!...........
The one major difference between wealthy and poor is how they are structured.....and they play their own game!.....if you want people to stop being poor then they need to start being responsible for themselves and their actions......
NZ spends a fortune on social services yet according to social services we have a growing poverty problem....maybe if you get rid of all the social services then poor and middle people will have more in their pocket and be better off.......
.. no matter how much munny you shovel towards the " poor people " , there always seems to be more of them ...
I've lurked furtively around the condom counter in Countdown many a live long day .... and never seen the " poor people " picking up packs of the old Durex ....
... the real problem with the " poor people " of this fine land ( girt-by-sea ) is that they need maps to find their way around a supermarket ! ....the frangers are in aisle 69 guys !!!!
Haha GBH..... :-)) They should have gone to PakNSave !!!
Sometimes I feel like I'm nothing but a friggin slave to the poor.....GST collection free, PAYE collection free, annual accounts for taxation free I could go on and on........and all this slavery goes on across the country behind closed doors because public servants are growing their own lifestyles at the expense of everyone else including the poor!!!
Poverty is a man-made problem....one has to look at the people making it happen!! Poverty has become a very large public services industry.....it is disgraceful that so many people make a living off poor people but the poor people have allowed the problem to manifest in allowing their own greed for free stuff to rule.
It should be compulsory for all public servants and buraucrats to wear a franger at all times!!
Often the poorest people spend like they're rich. Most of the richest people I know spend like they're poor.
One thing I did notice down in deepest darkest Wairarapa was the attitude of there is no point building a future because that's what rich arseholes do. Decent folk buy things for friends, go on holidays, get drunk/wasted, don't be money hoarding misers, have cars, buy petrol, have barbys, spend way to much on electricity or a cool set of shoes, and buy overpriced but unfancy stuff for babies.
Any mention of investing or putting some aside for the kids university fund was unthinkable - saving for personal emergencies, yes, that was what you did - you put some aside every week, and if you didn't need it you use it on your holiday or buy yourself something nice like a big tv or video game. If you had a windfall or if your income lifted (eg benefit raised) you just got an extra fush, or got extra 6 pack. Or the missus squirreled it away in her secret "when I leave the pr..k account" and never told anyone.
I am seriously disappointed that Bill English has lost a number of years from the development of Kiwisaver. There should have been a progressive change in the rules. By now enrollment should have been universal and contributions about 10% gross and on the rise to the eventual 16%
But I never believed there had to be a government subsidy at all. Stopping the $1000 was always going to happen.
Don't tell me you can't afford it. The hard reality is you can't afford not to.
Depression is actually much less than normal.
But yeah, I was being cheeky. With Fonterra not paying out, the Dairy Farming (company) I'm employed as Managing Director for has no income. It can barely pay the vet bill, let alone interest bill, and I've cut back my wages to enough to cover Child Support, $200 on personal loan, and the PAYE on those two numbers ($787 gross a month).
I'm actually having to get by on my FX income, which post Swiss, is not huge.
However, do recall, I do have to manage a Family Trust, the Trust has most of the shares 98% in the Dairy Farming (company). I was "encouraged" to give up the dairy farming in return for a 500k 20yr low interest loan. That mostly ends up in the Trust hence the buying of houses. But the Trust is specifically setup for future and future family funding - ie family can take _loans_ from it but have no access to it for living or other demands (this is to stop people like my Great Grandfather (fathers side, not the Scottish one, from spending it all on buying racehorses and booze - at least he had the good graces to die young - that great grandfather spent his way through a huge inheritance and property leaving his son (my grandfather) to spend most of his life paying the debts he left.... another case of someone I wouldn't be ready to pay means tested welfare for. The family -used- to have the largest farm in the Manawatu, but he blew the lot and then some. no welfare for you ...)
One reason I purchased PV panels last year ($8.40 payout) was because I could carry them forward no matter where I ended up.
Solar hotwater is a longterm property improvement so falls in the purvey of the Trust, and is actually something that is planned on all the Trusts rental properties.
I personally still have to find some rent to cover my renting of the Trusts property but it's not huge and the low energy cost (and good insulation) are a contribution to that.
The other reason for the exit from farming is that since the girlfriend (and mother of two of my kids) didn't want to go farming and went on DPB instead, is that I'm on my own. A 2mm kidney stone the other day proved that farming is not a solo activity. I had to get an ambulance to pick me up (first stone I've had) but I was unable to milk or even shift cows onto new feed that day. That is a huge threat (not just risk) to the businesses operation, even worse than the milking staff putting the cows in with the penecillin cows. Employees can miss days or call in sick. When you're self employed, missing a day cancels that income and work. But on a farm _a_day_ or two like that and you can be wiped out for the whole _year_ (the cows only lactate the amount that was removed, after several days the hormones stop the production and don't start again until a calf is birthed). Similar for the weight gain, once it's gone you can't get it back.
KH the trouble with your type is that you are in a box of your own making. Some of us live in a different world. We feel that the responsibility for our retirement years should be kept within our own grasp. Giving that responsibility to fund managers and banks is not part of our plan...ahem...thank goodness....you may trust....I dont.....therefore my plan is to be mortgage free on several hundred acres with a good garden, a liveable house and plenty of my own cattle and sheep. If I give some fund manager 16% of my income I doubt I could do my model of retirement. I am nearly there though. Just you lot leave me and my dosh well alone
I find the land a bit of a hassle (land = up keep),
My target is to go free-energy low-impact with share capital in a few necessities to keep the rates contribution and pay the maintenance person(s) covered.
At a certain point I won't be educated enough and mentally flexible enough to look forward, so supporting myself through writing or teaching isn't an option.
Land = upkeep. Not wrong there. I didnt say I had the most cunning plan. I freely admit there are numerous pitfalls in The Plan. However like everyone else we make our plans....well some of us make plans....and hope for the best. Free energy I debate internally on a regular basis when I get my lines bill of 300 smackers a month. Thats the boys who deliver the power. Not the power itself! KH....if you subscribe to my plan, why do you want to make everyone subscribe to the 'give my money to the markets and pray,then not get it back til I have 1 foot in the grave' philosophy?
There are a bunch of things that can be done to bring that bill down without overly impacting on lifestyle.
I'm aiming at exploring some of the most readily available and cheapest to implement because we want to put them into the hands of those who are most desperate for them, without penalising more wealthy people who want to also give it a go. However when my working capital vanishes it's hard to fund the work.
The PV solar panels are expensive.
The external Solar hot water (extra large store tank) seems to be worthwhile.
There's also a promising idea for "California bungalow" style housing (most common NZ stand apart dwellings) that involves running a coil of pipe (eg 25mm alkathene) directly under the roof, in the ceiling cavity. This will allow the cold water to get some warming before getting to the cylinder. Meaning either more hot water, better recovery time, or more efficiency from existing solar hot water.
The new LED downlights are very effective lights, look great, and are extremely energy efficient. (currently they come in 230v AC, but hopefully in the not to distant future a native 12v DC will become popular. Also they can be mounted under insulation so that means the room doesn't leak heat in holes in the roof. Although the transformer for the 230v each one has does need to sit on top of the insulation but thats not a big problem.
Loving the double glazing. I go with the Low Emissions (it has Noble Gas put in the cavity been panes to further reduce the heat and noise transference.
Hoping to look into some thermal mass storage, soon. Basically a large insulated tank of water, or insulated pile of wet sand and bricks. Utilising direct sunlight onto the pile and some convection pipes with water in them also exposed to sunlight but sheltered from wind and rain, I should be able to create the same effect that used to be achieved from nightstore heaters and/or underfloor heating. The themal mass is used like a low output boiler and the heat pumped via water pipe to the rooms. The extra insulation in the windows, floors etc meaning we need very little heat to bring or hold the room to temperature. Theoretically by using exposed radiator fins and shade and a little evaporation (grey water??) or even just stored rain water, we should be able to affect some cooling with the same set up.
Then any heat pumps for cooling (powered by bright sunlight) or additional heating (Elons batteries connected to a small wind generator) would be icing on the cake.
I've got a solar powered cooker coming in from the US near the end of the year for testing. It's basically like a large tube that they use in solar hotwater, with a phase changing thermal mass to keep the cooking ability for many hours, a a reflector. I'm suspecting that in NZ it's only going to be good in summer and early autumn but it has no element and no moving parts and no electrical connection - so it should be good for a lot of places. And possibly gas or PV powered air cooker much of the rest of the time....
What gets me about the 1 foot in the grave plan...is that if there's an upset... all those people are wiped out. Remember how those same experts had ACC at 1 billion shortfall only a few years ago? What would happen if people were using those life savings to live on? Or all those finance companies that went legs up? Or some friends of mine had money in Bridgecorp and Goldcorp, all gone... but their friends who had double leveraged to get money into Lloyd's also got hit for the first time in history.... cost them the family estate. too much risk for money that can't be recovered, not when the decisions are all left to someone else
Some good ideas cowboy. I wish I was better at the vege n fruit gardening. I realised I could be better off employed in the garden than the part time job. By the time I paid a third in tax, if I had milked a cow and grown veg I was saving a fortune in gst as well. Self sufficiency must be a govts worst nightmare. Cant tax it.
A better interpretation is unmistakable in the analogy referred to in this expose of self serving political artifice.
Many years ago now, at a swanky Auckland restaurant, I found myself seated next to a well-known right-wing journalist. Not surprisingly, we ended up arguing about Rogernomics and Ruthanasia. I asked her this question: “What would you do if you were told that in order to go on receiving all the good things you currently enjoy, you would first have to consent to a person being chained up in a dungeon and fed your scraps?” Well, she hummed and hawed for a while, and then offered me this quite extraordinary reply. It would be alright, she said, because, as she became richer, she’d make sure the prisoner received more food, and that his chains were loosened, “so he could move about a bit”. Read more
"Bill English and John Key are taking money off the rich and giving it to the poor in Budget 2015"
Did I miss the page in the budget where a land tax, CGT or whatever "wealth" tax was implemented? Did I miss the bit about regulating maximum income limits and the rest must be shared?
Nothing has been taken from the rich.
... not even the smirk from their faces , as they count their massive wealth gains from Auckland house price escalation or from dairy land price inflation ...
Wild Bill and little Johnny havn't even removed the Cheshire Fat Cat grins from the faces of the rich ...
I have to laugh at anyone who thinks the "rich" of NZ are those taking a holiday overseas .. the real "rich" of NZ are the entities/owners of profit made in NZ that get dodged, diverted and declared overseas in some tax free haven.
I found Fran O'Sullivan (of all people!) talking more straight-forwardly and sensibly than you on Q+A this morning, Bernard about the budget bereft of a plan. I get the sense that Fran really has turned a corner - she's become sick of spin, and of the old left/right argument.
She knows NZ is facing dire times and that this government hasn't got a clue.
From Students Loans grows Parent Loans
So a mother who was receiving welfare until her child is 5 will now receive an extra $25 pw but has to enter the work force after 3 years and earn an income and pay tax
Sounds like a Parent Loan where she gets an advance of $3900 spread over 3 years at $25 pw which she will be paying back in the form of tax over the 2 extra years of earning and paying tax
Like giving with the right hand and taking back with the left hand 3 years later
The instalment from the final week of the 3rd year will be yanked back 1st week of the 4th year
Dr Lance O'Sullivan interviewed on The Nation this weekend - stated he was in favour of the National initiative to push kids at 3 years into approved childcare centres - as he pointed out that often their home environments were extremely dysfunctional (less healthy from a psychological and physiological point of view).
He was making an argument for day care as a sort of state sponsored foster care - because foster care was better than home/parent care. Given he's a GP in Northland - it was a pretty bad assessment of the standard of parent/parenting up there.
http://www.scoop.co.nz/stories/PO1505/S00329/lisa-owen-interviews-north…
Its just a budget, brought to you by the current religious elite; the economists. Their light is fast-fading as their models crash back to earth. Have a look around bond/commodity/stock/derivative markets and tell me this fits any textbook....!
Sooner than most think, ALL economics will become local, and boy, what a hollow local economy we have here in NZ. Have a look at how much of what you buy is imported.
We have even elected a Financial Whizz Kid to pilot the ship, one intent on legislating against the real world sustainable path, opting instead for political one-upmanship and ignoring the welfare of those engaged in the real economy. We continue to focus on and grow the FIRE economy at the expense of the real economy.
"Though economists, policymakers, investors and the general public customarily think in terms of
money, this conventional thinking is profoundly mistaken because, ultimately, the economy is a physical rather than a financial construct. Rather than being in any sense fundamental, money serves to tokenise output into a convenient form. After all, the world economy has survived the demise of an estimated 3,800 different paper currencies."
( tullet prebon)
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