Wednesday, 10 November 2010
‘NZ Not for Sale’ campaign to oppose trade agreement
The New Zealand Not For Sale Campaign will be formally launched in Christchurch on November 11, in conjunction with the launch of Professor Jane Kelsey’s book on the Transpacific Partnership Free Trade Agreement.
The NZ Not For Sale Campaign has been set up to oppose the Transpacific Partnership because it is against New Zealand’s best economic, environmental and social interests.
“The trade agreements we already have are linked with high international debt, job losses, asset stripping, risky speculation, increasing sales of land to overseas owners, running down public assets and services, and loss of tino rangatiratanga and national sovereignty’’, says the Campaign Secretary, Dr Christine Dann.
Tuesday, 9 November 2010
Climate Activists to Dairy Summit: ‘Get a real job on a real farm’
Camp for Climate Action Aotearoa invites the corporate farmers of the World Dairy Summit to get a real job on a real farm
In response to yesterday’s Federated Farmer’s press release telling protestors of the World Dairy Summit in Auckland to “Get a real job like farming” Camp for Climate Action Aotearoa suggests that Federated Farmer’s listen to their own advice.
Camp for Climate Action Aotearoa spokesperson Gary Cranston says “we support the actions of small scale farmers all over the world who are already living sustainably, feeding their communities and defending their climate-friendly farming practices from mega-scale agribusinesses.”
“As a stream of greenwash spews from the World Dairy Summit into our rivers small-scale farmer’s livelihoods are not only threatened by climate change, they’re also threatened by industrial agriculture itself and the kind of money-making false solutions that the world’s agribusiness giants are pedalling at the UN climate negotiations and through John Key’s Global Research Alliance on Agricultural Greenhouse Gases.”
Thursday, 4 November 2010
Hillary Clinton comes bearing poisoned chalice for NZ
CAFCA
As if 2,000 earthquakes haven’t been enough punishment for Christchurch, now we’re going to have Hillary Clinton visiting us (and Wellington) this week.
A major focus for her NZ visit will be the negotiations which are well underway for the US and a number of other countries to join an expanded Trans-Pacific Strategic Economic Partnership (currently comprising NZ, Chile, Brunei, and Singapore, and known as the P4 Agreement), with 2011 as the target to seal the deal. This will be used as the backdoor means to secure a US/NZ Free Trade Agreement.
Thursday, 23 September 2010
Savings? That’s a laugh
On 27 April this year the 6pm TV3 News reported:
60% earn under 40,000 per annum
88.1% earn less than 70,000 per annum
6.8% earn 70,000 – 100,000 per annum
5.1% earn over 100,000 per annum
The average rent for a two bedroom house in Auckland is $400/a week or $20,800 a year. For the “average” worker (see above) earning $45,000 per annum before tax, $20,800 a year represents 46% of gross income in rent alone.
Once you deduct income tax at 33%, and the extra 10% tax paid for your Student Loan on top of that (the uneducated seldom earn $45,000 per annum) what’s left for food, power, phone, car payments, etc?
International guidelines say any rental or mortgage payments over 33% of gross family income constitute true poverty and hardship. Who can raise a family, pay the vastly inflated rents or mortgage and have any money left over at the end of the week on figures like those?
Most people’s earnings are 25-50% of what they were 25 years ago in inflation-adjusted terms. So it’s a bit rich for Mike Heath – the wealthy banker from Rabo Direct, to chide workers for “failing to save” when people like him have spent the last 25 years grinding down wage and salary earners incomes in order to save the capitalist system from itself.
Tuesday, 31 August 2010
South Canterbury Finance: ‘A lot of bets in the casino paid off big time today.’
At the same time, bloggers often depend on “real” reporters to dig out and even explain news that we wouldn’t otherwise know about. The following article from the Herald is a good example.
It’s these “bargain hunting” speculators that the Tax Justice campaign is targeting with our call to “Tax Financial Speculation”.
Thanks to Peter, for forwarding this. Here are his comments:
$1.3 billion of government money paid out today to the speculators for Hubbard’s worthless South Canterbury Finance shares and bonds. Break out the $900 bottles of bubbly! Great news for the parasites, too bad for everybody else who happens to need a pay rise such as those pesky radiographers and teachers.
This will also be paid for by all those unemployed people having their entitlements chiseled away and disabled people being hammered by the ACC and WINZ. Maier’s face says it all...
Speculators reap fat reward as finance firm fails
from NZ Herald
Bargain hunters who bet against South Canterbury Finance in the NZX debt market will be rubbing their hands with glee today with the guarantee covering the failed financier’s listed bonds plus interest.
The Timaru-based finance company called in the receivers today, triggering the government’s retail deposit guarantee which will pay out the face value for the firm’s debenture and bond holders.
Prices for the company’s listed bond maturing in 2012, after the extended guarantee, fell to a deep discount earlier this year, with the yield reaching 40 per cent in March.
That meant audacious punters could buy them cheap and get paid out in full if South Canterbury failed.
“There will be a lot of money made in the listed bonds with prices up to 20, 30 and 40 per cent, which was all paid today,” chief executive Sandy Maier said in a conference call.
“A lot of bets in the casino paid off big time today.”
The yield had abated in recent weeks, and was last at 24 per cent before trading in the security was suspended.
The government will have to pay-out $125 million on the bonds.
Maier said the guarantee, which many commentators claim distorts the market, gave him confidence to accept money from “widows and children” as he sought to save the company from collapse.
The failure of the finance sector has seen a number of low-ball offers for debenture stock, and prompted the Securities Commission to warn investors to make an informed decision before accepting bids significantly below face value.
Hubbard’s ‘bad bank’
While National MPs claim there is no money to pay teachers or doctors, the government prepares to hand over, up to half a billion dollars to private investors who bet on a lemon.
The lie is, that this must be done for the good of the economy.
It didn’t make any difference in the US and it won’t make any difference here.
Sinking deeper and deeper into recession, the American example shows that the idea that private sector bailouts are good for the economy is pure unadulterated bull. The only ones to benefit from public bailouts of private investment companies and bad banks, were private investment companies and bad banks, their overpaid managers and fat cat shareholders.
The US government and the country at large were impoverished by multi- billion dollar bailouts of bad banks and investment companies.
While wealthy investors were looked after, tens of thousands of average Americans who had their jobs and homes taken from them, due to the malfeasance of these same finance companies and bad banks – were shown no such largesse.
Why can’t New Zealand learn from what has what happened overseas?
The truth is that saving the economy is not what private sector bail outs are all about.
Taking care of the well off, at the expense of everyone and everything else, including the economy, is what it, is all about.
Yesterday, Liam Dann the Herald’s business editor, described how the National government has deemed Alan Hubbard’s “Bad Bank” as a New Zealand’s version of “too big to fail”.
Liam Dann on Hubbard:
Put the probe into his personal financial entities to one side. The real story is South Canterbury Finance – the $900 million liability hanging around the taxpayer’s neck…..
Hubbard lost control of that company earlier this year after it had breached its trust deed.
He was removed from the board and given the sentimental title of President for Life
By that point the Government had already effectively decided the company was too big to fail.And:
The bad loan “bank” is up to its neck in $600 to $700 million of debt on assets that may yield as little as half of that when they are realised.
When it is euphemistically said that South Canterbury failed to “stick to its knitting” it is the bad bank that people are talking about.
For people on suffering the pain of minimum wages barely enough to pay the rent, without the luxury of spare savings to invest in high finance. It’s a bitter irony that wealthy and middle class investors should have their speculative losses made up by a government that viciously opposed raising the minimum wage. What do these people know about hardship?
While the government continues to do nothing about joblessness and low wages, the question is, how many more millions of dollars will they uselessly throw investors way, as the recession deepens and more finance companies go under?
Friday, 27 August 2010
NZ–tax haven for the international rich
The conservative UK Sunday Times newspaper recently published a survey of countries with a comfortable western standard of living wealthy tax-exiles could consider escaping to.
This article [only available online for a fee], published on July 11th 2010, described New Zealand’s 2010 budget as “the most radical change to taxation in 25 years.” Compare this to Key’s local attempts to downplay the importance and impact of the 2010 budget.
For a British boss or money speculator making £150,000 a year, Switzerland will take only £40,000 a year, yet “socialist” New Zealand is next cheapest tax shelter with just £50,000 of income taxes.
For this, the wealthy ex-pat gets access to a free world class health system, cheap housing conveniently out of reach for 90% of the population, anti-labour union laws such as the 90-day “fire at will” law that makes the setting up of a tax-loss generating “business” simple and relatively risk-free, and much more.
The cost of these gifts to the transient wealthy is a massive destruction of citizenship rights for Kiwis, with swingeing cuts to ACC entitlements, access to education, health rationing, the protection of union membership, GST rising to 15%, etc. Key’s austerity policies for the poor and working class are costing some their lives and making survival near-impossible for many families.
John Key sold himself to the electorate on the basis of tax cuts, but many didn’t realise that these cuts are biased towards the ultra-rich top 2% of the workforce. Key has transformed New Zealand into a tax-exile destination and articles such as this one in Bloomberg are here to sell the results of these decisions to the world’s rich.
‘Smiling assassin’ targets rich immigrants
Prime Minister John Key promoted New Zealand on David Letterman’s Late Show last year. Photo / AP
Tuesday, 1 June 2010
New strategy from NZ union leaders
Last week, the NZ Council of Trade Unions released a second draft of their Alternative Economic Strategy.
Sound boring?
Actually, the CTU’s document could flag a major leftwards turn by the peak leadership of our union movement.
After a quick read of their revised strategy paper, here are some of my initial thoughts:
HOLISTIC ALTERNATIVE
The CTU is looking to embrace a holistic alternative to neoliberal capitalism, which is exploiting workers and nature to breaking point.
And their alternative vision seems to be growing more staunch over time. In the eight months since the CTU’s first go at crafting an Alternative Economic Strategy, its content and tone have become stronger.
For instance, the CTU has zeroed in on financialisation, the central pillar of neoliberal capitalism. The CTU is now calling for the immediate reduction and gradual elimination of GST, the introduction of a “financial activities tax” and other measures to curb the power of the speculators.
The second draft still contains structural weaknesses which flow from the CTU opposing capitalism’s neoliberal agenda without rejecting capitalism as a system.
Such weaknesses, however, should not obscure the positive potential of the CTU’s Alternative Economic Strategy. A finished manifesto is scheduled for signoff by CTU affiliates within the next month.
Top union leaders appear to be equipping themselves for a strategic showdown with neoliberalism.
That may well herald a historic break with the CTU’s past practice of ducking a frontal battle against neoliberal orthodoxy despite grumbling about market extremism and skirmishing around specific issues.
POPULAR DISCONTENTS
Two days after the 2010 budget’s hike in GST, Socialist Worker and the Alliance launched a tax justice petition. Calling on Parliament to axe GST from food and tax financial speculation, the petition is already drawing wide support.
Our crowded street stalls allow me and other petitioners to hear the voices from below.
What do we hear? Rumblings of discontent over belt tightening, rising prices, lowly status, community breakdown, corporate greedies, unfair laws and deaf politicians.
These popular discontents indicate the broad constituency for change that could be mobilised by a CTU showdown with market extremism. The union movement would start to regain a central role in New Zealand society.
And the CTU’s strategic shift has the potential to reshape New Zealand politics in ways that benefit the multitudes, such as:
• Bolstering the Labour Party’s network of left activists and sympathetic MPs.
• Eroding the Labour Party as an institutional barrier to mass political action.
• Growing the institutional basis for a broad left party that fights neoliberalism.
JOINT EFFORTS
So will the CTU’s new words be followed by inspiring deeds? We cannot know for sure until after CTU affiliates endorse the Alternative Economic Strategy and CTU leaders have the chance to make it fly.
Meanwhile, there’s plenty the rest of us can do to help the CTU rise to the occasion.
For instance, the CTU’s revised strategy paper recognises that tax policy is becoming a key social battleground.
To fund tax breaks for the rich, John Key’s government is hiking GST to 15%. This unjust imposition on modest income families has been damned by the CTU. How about telling the CTU that you back their stance, and ask them to lead protests on 1 October when the rise in GST takes effect.
The Labour Party’s recent Auckland regional conference voted unanimously for GST-free food and a financial transactions tax. That internal party pressure, itself fueled by public sentiment, led a reluctant Phil Goff to say that Labour in government might consider removing GST from fresh fruit and veges. How about telling Phil, and other Labour MPs, that you want much more, for sure.
A Maori Party bill to remove GST from healthy food will soon get its first reading in Parliament. How about telling Labour and Green MPs that you expect them to vote for this bill, no ifs, buts or maybes.
Socialist Worker and the Alliance are fronting a tax justice petition that’s in harmony with the CTU strategy. How about telling the CTU that you support our petition, and ask them to promote it hard. Likewise with MPs from the Labour, Green and Maori parties. And how about you joining our team of petitioners.
Joint efforts to remove GST from food and tax financial speculation will undermine financialisation, the heartless heart of neoliberal capitalism. That’s got to be good for the grassroots. And for the success of the CTU’s Alternative Economic Strategy.
CTU: Alternative Economic Strategy – final draft
The economy is failing to thrive and is badly unbalanced.
Those policies are rooted in the idea that less government is better government and that “the market” if left to itself will lead to faster economic growth and better outcomes for society. New Zealand has had slower growth rates and has failed to keep up with the rest of the world.
The policies have enriched a small number of people, and have accelerated the migration of New Zealanders overseas. The economy has growing imbalances of household and international debt, of investment based on speculation rather than production, and of interest and exchange rates at levels that worsen rather than resolve these problems.
Sunday, 23 May 2010
The GST rise big story of the Budget
The GST rise is definitely the big story of the Budget, even Greenpeace’s press release focuses on it.
Although, disappointingly, they call for the “strengthening” rather than scrapping of the ETS pollution market, and offer an endorsement of the UK’s new Tory leader David Cameron, who allegedly possesses “some forward-thinking and visionary ideas.” (Which is news to me, as I was under the impression he was just another Margaret Thatcher / Tony Blair corporate clone... rather like John Key.)
The focus on this regressive tax increase, rather than the cuts in income tax is bad news for National and a another sign that the public mood is turning against the Government.
In their official statement, the Maori Party did their best to accentuate the positive, by listing all the little projects that got funding, and asking their supporters not to focus on GST:
“We know that the biggest challenge will be in encouraging our constituency to look broader at the whole picture of the budget – rather than focusing on one measure in isolation.”
But such a focus is unavoidable. As Maori Party MP Hone Harawira put’s it:
“GST hits poor people the hardest because nearly all of their money is spent on things that you pay GST on – food, petrol, electricity – so any increase is going to really hurt them.”
That extra 2.5% will be increasing the impact of every peak oil petrol price hike, and every world commodity market induced rise in cheese or bread.
Harawira’s personal statement against the GST rise, and his request to party leaders for permission to vote against the increase, have earned both praise and criticism.
Marty G at The Standard urged Harawira to “have the courage of his convictions” and cross the floor to vote against the Budget even with out his party’s permission. In the event, Harawira’s vote, along with those of the five other Maori Party MPs went for the Budget.
Comments on the post have suggested that voting for the Budget makes Harawira a wimp, a sell-out or a blowhard. But while I would have applauded Harawira had he crossed the floor, I think it would have been a tactical error for him to go against the wishes of his party leaders, at this time.
The right wing of the Maori Party have already tried to force him out, for the trivial offence of using offensive language when pointing out the crimes of Pakeha parliamentarians in a private email. To break ranks over this issue would only given them another excuse.
Maori Party co-leader Tariana Turia had the support of (and was under pressure from) a hikoi of tens of thousands before she broke with Labour over the foreshore and seabed act. Who does Hone Harawira have? How many people took to the streets against the GST rise?
The only thing coming close is the few dozen of us who went out today to launch the Socialist Worker – Alliance petition calling for GST to be removed from food and financial speculation to be taxed.
Saturday, 22 May 2010
Picking pick-pocketing suits
Apart from Hone Harawera’s statement, my favourite was from the Maritime Union’s Joe Fleetwood, whose press release “National budget an attack on working class” says:
“rather than increasing GST it would be easier for workers just to hand over a $5 note every time they saw someone walk past in an expensive suit, because this was the actual effect of the GST increase.”
I thought about this when I was in town today. At first I only saw a few men in suits, but there were more when I passed near the court.
Of course I didn’t actually offer any of them five bucks. For one thing I didn’t have than much money, but more importantly, I realised that I have know idea how to pick the expensive suits from the cheap ones.
Was this man a high-paid corporate lawyer, or a common criminal dressed up in his court-appearance best? And how do you tell the difference?
National budget an attack on working class
Press Release: Maritime Union of New Zealand
Thursday, 20 May 2010, 3:24 pm
The Maritime Union of New Zealand says today’s budget is an attack on working class New Zealanders.
Maritime Union General Secretary Joe Fleetwood says the increase in GST to 15% was taking money from the pockets of workers to pay for tax cuts for people like John Key, who had so much money they would have trouble knowing what to do with it.
He says rather than increasing GST it would be easier for workers just to hand over a $5 note every time they saw someone walk past in an expensive suit, because this was the actual effect of the GST increase.
“It is a wealth transfer from low to middle income earners to the wealthy.”
GST was a regressive tax that would hit struggling New Zealand families hard.
Mr Fleetwood says that a major problem for New Zealand is growing inequality of wealth.
Inequality leads to social breakdown and long term economic and social problems, as international research has shown, and National’s budget was making inequality worse.
He says the idea promoted by John Key that only high income earners contributed to New Zealand’s economy and society was both offensive and wrong.
“If we are at the stage where New Zealand is being held hostage by a tiny minority of the super rich, maybe it is time to question whether we still live in a democracy?”
Mr Fleetwood says that the international evidence shows that excessive wealth was being accumulated by a few at the top end of the wealth scale, while the majority of workers were squeezed by rising costs and static incomes.
“John Key is rewarding the big business, finance sector CEO types who are the backers of the National Government, whose greed knows no limits.”
He says the obsession with tax cuts was leading New Zealand down a dead end road as tax was essential to pay for hospitals, schools, infrastructure and other vital public goods.
However the tax burden was increasingly falling on low to middle income earners rather than the wealthy, which was the wrong way around.
ENDS
Wednesday, 21 April 2010
The CTU’s Alternative Economic Strategy – a way forward for workers?
Also speaking will be Socialist Worker National Chair, Vaughan Gunson, who will discuss whether the Alternative Economic Strategy can be the basis of a broad left campaign against neo-liberalism.
Thursday, 8 April 2010
Water: ‘When Federated Farmers asks, the Government listens’
Wondering what is behind the sacking of the Canterbury Regional Council over the control of Canterbury’s water resources? When Federated Farmers ask, the Government listens.
New Zealand’s biggest business pressure group put out their wish list in early February. Since then the Government has been ticking the boxes one by one.
Monday, 21 December 2009
Visions of a people-centred economy
Monday, 23 November 2009
More neo-liberalism or an alternative?
Tax reform needed to jump-start economy by Brian Fellow from NZ Herald 23 November 2009 Far-reaching reform of the tax system and a much tougher approach to Government spending than the Budget foreshadowed will be necessary if New Zealand is to narrow the income gap with Australia and other developed countries, the Treasury says. The economy is seriously under-performing, it says in a report to ministers titled "Getting Started on Closing the Income Gaps". Both Government and private consumption has run well ahead of income, while business investment has been relatively modest. Debt levels are high, and land and house prices probably unsustainable. The Budget was underpinned by an expectation that the recession would trigger a process of rebalancing which would put the economy on a more sustainable path, but that is not panning out. Instead of the expected 25 per cent fall in real house prices, they are heading back above their 2007 peaks, aided by strong net immigration. The reorientation of the economy away from consumption towards production and exports is likely to be slower and weaker than had been hoped and that would mean overseas debt reaching even higher levels than those the Budget had forecast (over 100 per cent of GDP) and which the Treasury doubts are sustainable. "At best our current medium-term economic prospects appear to be fragile, unbalanced growth. There is little in the current policy mix that would make a material difference in terms of closing the income gap." What would, the Treasury argues, is a combination of ambitious tax reform and "front-loaded fiscal consolidation" - code for belt-tightening in Government spending that goes well beyond the $1.1 billion cap on new spending adopted in this year's Budget. "You have the opportunity for once-in-a-generation reorientation of the tax system," it told ministers. "If the opportunity is embraced, far-reaching tax reform could make a powerful contribution to jump-starting a process that, over a decade or two, could close the income gaps." The less ambitious the approach to other taxes like GST, land tax and capital gains tax, the harder would be the required choices about where to concentrate income tax reductions. Structural reform could not begin and end with tax, however. Also in the Treasury's sights are privatisation of state-owned enterprises, pricing not only carbon emissions but water, and a greater role for external capital in the dairy and meat processing sectors. Since 2002, New Zealand has had the fifth-highest rate of increase in Government spending in the OECD. The report is clearly talking about a significantly more demanding track than the Budget, which envisaged a decade of deficits even with a much lower cap on new spending.Significant and well-foreshadowed cuts in Government expenditure would limit the need for official cash rate increases by the Reserve Bank, it says, which in turn would mean less pressure, all else equal, on the exchange rate. The Budget had relied on fiscal drag - the process whereby inflation pushes people into higher tax brackets - to reduce deficits over time. "Fiscal drag sounds innocuous. In fact it would mean that by 2022/23 the average wage earner would be paying the top marginal tax rate." The Budget's priorities had been supporting the demand side of the economy through a recession, while averting a credit rating downgrade. "Having dealt with that initial situation, some more significant adjustment is now warranted." A combination of spending cuts and tax reform, the report says, could deliver an economic scenario which looked like this: Materially weaker consumption relative to income and lower house prices, materially stronger investment and employment in the export sector, a materially lower exchange rate for several years, interest rates and a cost of capital more in line with international norms and a materially stronger fiscal position with scope for tax cuts in the future.
Thursday, 12 June 2008
Latest terms of trade confirms NZ is a wealthy country
NZ’s terms of trade, as reported in the NZ Herald, is the best for 34 years. The terms of trade, which measures export values versus imports, rose 4.1% over the last 3 months, and in the year previous to that 11.3%. The growth is mainly due to soaring prices for dairy products exported overseas, and increasing costs of imports due to rising oil prices.
As the NZ Herald put it “the increased purchasing power of the export dollar makes New Zealand a richer country”. Fundamentally NZ is a wealthy country. In 2007 national income rose 5.1%. There's been sustained economic growth since 2000. The wealth, however, has not been shared around. The rich have been gorging themselves while the relative wealth of middle to low income earners has stagnated or fallen. There are real signs that the economy is heading for problems, as a result of the global economic crisis and the bursting of NZ’s housing market bubble. The wealthy elites now want workers and other grassroots people to tighten their belts and be "realistic" about what the country can afford. This would be injustice heaped on injustice. There should be no poverty in NZ today, and we should be rushing to fund public solutions that will cut greenhouse gas emissions. Finding the $400 million a year needed to make tertiary education free should be no problem at all. That's why the demands being put forward by RAM are simply common sense:
- Remove GST tax from all our food.
- Mobilise for climate security, like public transport funded by road budget.
- 2% interest state loan for a first home.
- Lift minimum wage to $15 per hour & legalise workers’ stolen rights.
- Free tertiary education & student living allowance to stop the ‘brain drain’.