Bank Holiday weekend

Which means 3 days without any time in front of a computer - because I'm off to the Bosphorus. Back late on Monday BST.

Don't spend all weekend partying away your imminent tax cuts on ... a kebab, a pint and, oh yeah that's about it isn't it?

Tories await victory

How do you turn a 7000 vote majority into a defeat? Ask Gordon Brown. The Crewe and Nantwich by-election is happening as I type, as a result of the sudden death of long standing hardworking Labour MP Gwyneth Dunwoody, a leftwing battleaxe who didn't put up with much nonsense (except her own socialist leanings) and was an MP since 1966 (sad to die while an MP at 77, I mean, why not have a life?).

Crewe is solid working class Labour territory, being a famous railway junction with major railway workshops. Nantwich is solid Tory, but the seat has never been anything but Labour since it was created, and its previous inculcations have been Labour since 1945.

Labour is about to get punished. This fairly solid Labour working class seat is going to go Tory. The BBC is already reporting 2 hours before the results come in that Labour is quietly conceding. Labour's campaign has been shocking though. Dunwoody's daughter is the Labour candidate and the Labour campaign claimed the Tory candidate is a top hat wearing toff with a large landholding with horses who doesn't even live there. Well he doesn't, he lives 30 miles away, but the landholding he is accused of owning is next door to his home, and he is no toff. However the Labour candidate has an entry in Burke's Peerage and Baronetage, and lives 130 miles away.

It's going to hurt Gordon Brown assuming Labour loses. The next likely by-election should be Henley, assuming Boris Johnson resigns given his new job! However Henley should be a pushover for the Tories. Quite simply Labour looks as tired in the UK as it is in NZ, but then it's awfully hard to please people when house prices are going down in most places, fuel and food prices are going up, unemployment is creeping up and the government finds money to nationalise a failing bank. Old Labour voters are fed up (and are too stupid to not know that more government doesn't work), New Labour voters have been seduced by the new vapid Tories, and that's it. Gordon Brown may face a leadership challenge after tonight.

One welfare recipient wanted more

The NZ Herald has a headline "Beneficiaries angry as they watch pay relativity slide". Yet the article quotes one, before quoting socialist academic Susan St John (what's stopping her paying more) and the Salvation Army.

The one woman quoted was once President of something called the Combined Beneficiaries Union. You might wonder why people who don't sustain themselves financially, who don't have to concern themselves with employment conditions, would need to belong to a Union - well, it is a leftwing lobby group. A bit like the infamously named Unemployed Workers' Union, an organisation that I thought as a child was contradictory. No one is a worker if they are not doing work (and let's avoid the stupid Marxist concept that anyone who isn't some blue collar employee ISN'T a worker). They exist to essentially lobby the state to make other people pay them more money, as crude and self interested as that.

However, wait there's more. The Combined Beneficiaries Union isn't privately funded - YOU pay for it. According to a Parliamentary Question from National MP Judith Collins, this "union" is 40% funded compulsorily by you. About $60,000 a year. Enough for someone's salary.

So you are forced to pay for an organisation lobbying to force you to pay its members more.

But wait, there's more. The woman interviewed was involved in a scandal regarding the firing of someone allegedly making expense claims for personal items. The story is here. To be fair the woman concerned, Helen Capel sounds like she has been treated badly.

However, that is by the by. The bottom line is that beneficiaries have been given nothing - you see they always vote Labour, but that means they don't need to be given anything by Labour. Of course those who care could always take their tax cut and any more, and give it to beneficiaries they know, or can find. However that would involve really giving a damn, and far too many talk about caring about the poor, but wouldn't go near actually helping them directly.

So what should National do?

So after accusing the Nats of wanting to borrow to pay for tax cuts, that’s what Dr Cullen is doing. Going into deficit to give modest tax cuts that STILL mean more tax is collected per person in real terms than was the case than when Labour was elected.

You see, if Dr Cullen had merely spent more to compensate for inflation since he held the Treasury reins, he would have increased spending by only 24.7% according to the Reserve Bank’s own inflation calculator. Now I know it’s a Labour government, you could say, well maybe he could have increased it by double that. No, government spending has increased by four times the amount necessary to make up for inflation since 1999.

Now what should National do? That’s what everyone is wondering. After all will it borrow more than Labour to give back more. Will it cut spending?

I don’t expect much from National, and it typically ensures that I have overestimated that. However , here’s an idea. Let’s say that National had remained in power in 1999. It is a fair assumption that National would have continued pretty much with the policies it had then. If we are to believe the Nats about efficiency in the public sector, then there is little need to grow spending beyond inflation is there? Yes population grows, but spending shouldn’t need to grow beyond that either.

Population growth since 1999 has been 6%, and with the inflationary factor of 25% on top of that, that means in order to maintain a steady state of spending, with no efficiency gains, government spending since 1999 should only have increased nominally by 33.2%. It has increased by 69%.

So National, if it was honestly maintaining the status quo of its policies, should be cutting spending back to where it would have been had it stayed in power.

National’s last full year in power saw total Crown expenses of $33.939 billion. It is now forecast for 2008 to be $57.364 billion. Had spending kept pace with only population and inflation, it should be $45.2 billion. National should be announcing spending cuts of around $12 billion.

What does that mean in tax cuts? Well using the Treasury handy calculations which are admittedly inexact as they don’t take into account the dynamic effect of lower rates generating increasing amount of revenue, this is what you could do:

Implement Dr Cullen’s new thresholds in full immediately ($80k for 39%, $42.5k for 33%, $20k for 21% and the new base rate of 12.5%). That’s $2 billion back in people’s pockets straight away, but that’s hardly enough.

Cut GST to 10%, providing modest relief on fuel and food prices to everyone. Another $1.7 billion

Abolish the 39% envy income tax rate introduced by Labour and cut the 33% rate to 25% along with company tax. A whopping $4.2 billion back to individuals and businesses.

Drop the 21% rate altogether down to the new lower 12.5% rate. Another $3.3 billion.

All up a tax cut of just short of $12 billion. You’d have company tax below Australia’s level at 25%, you’d have a two tier income tax structure with a rate of 12.5% up to $42,500 and 25% above that. GST would be down to a simpler 10%. Think how much more competitive that would look, think how kiwis in Australia and elsewhere may go, hmmm keeping 75% of my income instead of 60%. By the way ACT advocates might note that this goes beyond ACT tax policy from the last election , which advocated 25 and 15% as two tier rates, and no cut in GST.

That’s just if National had been prudent and spent no greater than inflation and population growth since 1999.

So do you think National will get that? Or is it addicted to pork as well? Was the government underspending in 1999 so much, or would you rather it spend like it was then and give you back the surplus? Are you getting value for money that means you'd rather pay the tax you spend now, rather than 12.5% on the first $42,500 and 25% on every dollar above (and a little less on goods and services)? Oh and don't mention roads, I haven't even touched fuel tax.

Cullen really is still taxing you more

So after accusing the Nats of wanting to borrow to pay for tax cuts, that’s what Dr Cullen is doing. Going into deficit to give modest tax cuts that STILL mean more tax is collected per person in real terms than was the case than when Labour was elected.

You see, if Dr Cullen had merely spent more to compensate for inflation since he held the Treasury reins, he would have increased spending by only 24.7% according to the Reserve Bank’s own inflation calculator. Now I know it’s a Labour government, you could say, well maybe he could have increased it by double that. No, government spending has increased by four times the amount necessary to make up for inflation since 1999.

So Dr Cullen has introduced a new bottom tax rate (for up to $14,000) of 12.5% (to please his supporters). A drop from 15% (after the low income rebate).

The raising of the 33% threshold from $38,000 to $40,000 is well under the rate of inflation since 1999. Had he inflation adjusted it, the new threshold would $48,000. The 39% threshold adjustment from $60,000 to $70,000 is also below inflation since the rate was introduced in 2000. The new threshold should be $74,000. So Dr Cullen is still taxing those people more than they were in 2000.

So why? What's the pork? Well the long list is in Dr Cullen's speech here, but here's quite a bit of it:

# Middle class welfare hiked up in the form of Working for Families (looking at National pointing at it to find something to get rid of in exchange for tax cuts). Recycling tax money so thousands of families are grateful they get “given something” from the state that was taken from many of them in the first place. Truly vile stuff.

# More subsidies so people in rural areas (who Telecom is forced to charge below cost for telephone line rental) can get broadband that they would otherwise get if they lived in cities (yet somehow people in cities don’t get the cheap rent, free parking and uncongested roads in return).

# More money to reduce class sizes, but nothing to link performance of the teachers to what they are paid (you can’t you see, because the teachers’ unions support the Labour party and are hard working people who work equally as brilliantly and nobody knows what a bad teacher is like).

# More subsidies for home owners and landlords to increase their property values by installing insulation and clean heating (South Island vote presumably).

# Rail pork, Dr Cullen wants to build the Marsden Point port branchline, a line that the profitable port company wont pay for (even though it apparently is wonderful for it) and which economic appraisal says is not worth the cost. He is Think Big man for rail, wanting a multi billion dollar underground rail link, a rail link to Auckland airport (even though most airport trips don’t start or end anywhere near the city) and one to the North Shore (even though that doesn’t stack up either), admittedly over 20 years. Of course it is a bit too much to expect users to pay even half the cost of that.

# Continuing the $30 million a year Jim Anderton transport pork for Gisborne/East Cape and Northland, essentially subsidising the roads used by forestry trucks (because charging them like is done overseas is clearly out of the question). Jim Anderton promised that forestry would generate jobs galore in those regions, although the share of the vote his party gets there doesn’t show they are grateful. Gisborne/Hawke’s Bay still has the highest rate of unemployment, so that’s worked a treat clearly.

# $27.8 million to the people living the dream of TV programme making with a Screen Production Initiative Fund (wonder why they can’t just borrow or spend their own money on filmmaking, I mean it’s such a difficult and gruelling profession). I’ve mentioned before how that lot are hand in glove with Labour.

# More money for the Ministry of Pacific Island Affairs, which of course does education, healthcare, immigration… oh no that’s right, it produces nothing but bureaucracy.

# $10.9 million so state radio can keep operating supporting statism . You be the judge as to whether a wide range of views on the budget and the role of the state get broadcast on it.

# $72 million to bribe the Winston vote elderly by giving them free off-peak public transport use.

But I'm not surprised. This is after all a Labour government, it believes in growing the state and in Nanny State. A tick for Labour is a tick for more government, all Dr Cullen has done is reduced how much he has increased the real tax take in future years. A tax cut? Hardly.

Why voting for Libertarianz can make a difference

It's rather straightforward. Assuming the Nats don't completely drop the ball and Labour can't be Santa Claus, the Nats will be the largest party in Parliament after the next election, by a reasonable margin. I'm expecting the 56% or so in the polls to be more like 45-46% on election night. Anyway, National wont need your vote to do this, hundreds of thousands of people know only that to get rid of Labour they vote National.
.
So National will be looking to coalesce with who? Like Labour it will prefer to go to the centre, like NZ First, United Future and, dare I say it, the Maori Party. That's what you face, none of that will scare the electorate at all.
.
ACT is proposing 20 changes in policy that are frankly no more radical than the sort of policies that were around in the late 80s, early 90s, IF that. A tax free threshold almost double that of NZ First, dropping the top tax rate (was National policy in 2000). Education vouchers was National policy in 1987 and more market oriented health care from 1990 to 1993 (but got seriously curtailed by lack of courage). ACC competition in 1999. Labour market freedom was 1991. Privatisation was policy from 1987 to 1999. The ONLY Act policy that is a shift beyond that is to shift social welfare to an insurance based model.
.
So what happens if ACT gets a sizeable vote, and National needs ACT to stay in power. Well ACT's policies get compromised. You get a smaller tax cut, you probably don't get education vouchers (but get bulk funding), you get ACC competition, but not insurance based welfare. You get RMA reform, but nothing too serious. In other words, you get what is already not that ambitious being less ambitious. Now if ACT pushed the 20 policies I suggested a few days ago instead, then you might get the compromise looking like ACT's CURRENT 20.
.
Ah, some may say a more moderate position gives ACT more room to say its policies are reasonable. Well shifting the goalposts to the left means the destination point remains closer to the left too. Rather unambitious for a party putting up the man who pioneered privatisation, proposed flat tax and shifting the entire social sector to insurance based models.

.
So how about Libertarianz? Ah your first point is "it's a wasted vote". Well let's just see how important your vote is. Don't forget, for all the hype your head is being counted along with a lot of others - it is a tiny influence, National isn't winning a seat just because of you, neither is anyone. What it SHOULD be is an extension of what you want. If you worry about what other people vote then you're making the influence of others important on your own decision.
.
Then you might say "well the policies are lunatic or too extreme". That's your judgment, but let's assume you want a lot less government and want some serious tax cuts and reform. Who is more likely to send the signal that there should be? The party calling for abolition of GST, the first $50,000 tax free and a flat tax, or the one calling for $10,000 tax free and getting rid of the 39% rate. The party wanting an end to state welfare, health and education or the one wanting to reform it with insurance or vouchers? The one wanting to cut it to core functions of law and order and defence, or the one wanting to cut it to - the level of Australia?

.
Imagine if there were 6 MPs who always voted no to more government spending on non-core activities and no to higher taxes and no to more regulation of people's day to day lives. Would you rather them or some National MPs? Even if Libertarianz fail to get 5%, imagine if 2% of the vote was for freedom. Other parties would start wondering why they didn't get the 2-3 seats those votes would entitle them too. ACT would certainly be more bold, and the next election more would notice they could vote for freedom too.

Look at the Greens. They influence government and policy considerably, with a core 5% of the vote on the hard left, and they certainly wield influence beyond that number. Shouldn't they be countered by a party of principle on freedom? ACT has had a chance to show it could be as radical as its founder once was, and as radical as it was in 1994. It doesn't seem to want to do that, although if the polls continue to show little change, it may change tactics closer to the election.

So voting for Libertarianz can make a difference, it wouldn't mean Libertarianz would be in government, and it might not mean it is in Parliament, but it does mean you've voted for individual sovereignty over your life, body and property, and for the state to exist to protect not to initiate force. So many people believe that, many vote for second best, and many more vote for third (?) best.
.
As the election campaign rolls on, we will see how all the parties perform and for now, I wont be making a final judgment, as much can happen. It is time to be bold politically and stand up for beliefs and philosophies, not pander to fears and prejudices. Your vote is a very small influence, so it should be one that says what you believe in - and that should be more than simply "I want rid of Helen Clark".

Sky defends itself against state broadcaster's whining

Sky Television's Chief Executive John Fellet has mounted an excellent defence of his company up against TVNZ's bleeting moaning and whinging about losing sports rights because it couldn't bid enough for them. Fellet is reported in the Dominion Post saying:
.
"a TVNZ submission to the Culture and Heritage Ministry calling for Telecom-like reforms to be imposed on pay-TV was "so incredibly filled with misrepresentation" that Sky intended to file a cross-submission to "jog their memory"."
.
He claimed that forcing it out of the market for sports programming saying:
.
"All the major sporting codes would go bankrupt if the Government prevented Sky from buying exclusive rights to sporting events"
.
Probably not all going bankrupt, but they would lose more players to overseas teams and codes because they would lose a lot of money, then you'd wonder why people might want to watch. You see after all, pay TV is a way for people to see games they may otherwise visit if they lived near the venue (or may prefer to sit in their own homes than go out to a match).
.
And to TVNZ's claim of being outbid by a broadcaster that people choose to pay for:
.
"Sky had been outbid by TVNZ for television series made by Warner Bros and Disney and had dropped out of the bidding for those made by 20th Century Fox. "We haven't won anything, we keep getting outbid, and then they are complaining they are paying too much for it - I don't know what to do."
.
Well indeed. He also points out that TVNZ opposed Sky buying Prime TV because it wanted Prime, a free to air competitor, to fall over. TVNZ naturally will never fall over because it is government owned.
.
One of those entities that have enjoyed suckling off the state tit, the Screen Production and Development Association is also concerned about Sky. No doubt because Sky doesn't think it is worthwhile to pay for the overpriced programming that it produces, even though it benefits from state subsidies. That association has long lobbied for the government to force broadcasters to screen local content and lobbied for taxpayers to pay for more programmes they may not wish to watch.
.
I'm sure it isn't looking forward to the Labour party led gravytrain becoming a bit less generous under the Labour-lite party. (though to be honest, who knows what National policy is?).

The thing is you don't have to pay for Sky TV, you are forced to pay for some programming on TVNZ and you are the taxpayers underwriting the risk of the business (and its devaluation under Labour in recent years).

Now you're going to subsidise coastal shipping

Not satisfied with having paid over the odds for the right to run trains on its own network, and the rolling stock. Not satisfied with that including a coastal shipping service (the interisland ferries), the government now wants to spend your money to prop up, wait for it, the competitors to the railways and the ferries, the coastal shipping companies.
.
It's not much money, $10 million a year over the next three years. Why?
.
Coastal shipping has not been subsidised in New Zealand since the 1980s, when the fourth Labour government cut the subsidies to the Stewart Island ferry service (which was operated by the Ministry of Transport) and the Chatham Islands shipping service. Funnily enough both islands still have services of course. Before that the Kirk Labour government propped up the Wellington-Lyttelton overnight ferry run by the then Union Steamship Company with the ferry Rangatira. The subsidies ended by the Muldoon government because of poor patronage and because competing rail and air services were profitable.
.
So what's changed? Well for starters, NZ First's Peter Brown is a shipping fanatic, he thinks it is the answer to many of the nation's transport problems. Harry Duynhoven is into it as well. So personal political missions sound like a good reason to make a decision don't they? So hey, why not prop it up. The goal is to double the amount of freight going by coastal shipping, which is because it is more fuel efficient, but here's the rub.
.
You see other than the ferries, coastal shipping is about moving containers and trucks. It competes with rail because rail doesn't feed those ships, trucks do. So the government buys one mode on the pretence of the environment and fuel efficiency, while subsidising another on the same basis, but it also insists on running the roads on a non-commercial basis.
.
The irony is if the amount of freight on coastal shipping doubles it could be largely at the expense of rail. You can barely wonder at the brilliance of paying over the odds for a business that you then undermine by subsidising its major competitors. Can transport policy get more stupid?

UK debates abortion and fertility.

The House of Commons has debated and rejected a private members bill to reduce the 24 week limit for abortions to 20 weeks. It has briefly fired up the debate on abortion in the UK (it's permanently fired up in the USA). The BBC reports it was rejected 332 to 190, now the debate is about cutting it to 22 weeks.

.

Now as I tentatively dip my toe in this issue, libertarian views on this vary. Some take the feminist view that the foetus has no rights until it is born, others believe it has rights as an independent entity, my view is that abortion should not be allowed except to save the life of the mother, once a foetus is theoretically viable outside the womb, but also abortion should not be state funded (as it is wrong that those who are against it should be forced to pay for it).

On a related issue, the House of Commons has also decided that IVF clinics should not consider "the need for a father and mother" when granting women IVF treatment. The change is that they should only consider "supportive parenting", which according to the Guardian essentially opens for lesbian couples to have IVF treatment. Now as libertarian as I am on these things, in that I don't want the state being involved, I do firmly believe that IVF children have a right to know their genetic identity, unless the supplier of sperm or egg is explicit about blocking that information, and that one of the core problems for many young people today is not having a good father figure/male role model. How to deal with this? I don't know, but ignoring the issue is not the answer.

UK grants Iranian gay teen asylum

I blogged in March about Mehdi Kazemi "Mehdi Kazemi is Iranian, and came to London in 2004 to learn English. Mehdi Kazemi is gay. In April 2006 his boyfriend in Iran was executed. Under interrogation Kazemi's name was mentioned as a partner, as his father informed him by phone. Kazemi feared he too would be arrested, charged and executed - so he claimed asylum in the UK. He was refused in late 2007. As a result he fled to the Netherlands. He now faces a court in the Netherlands where he is also claiming asylum. If he fails, he will be deported to the UK - and there he faces almost certain deportation to Iran - to his certain persecution."

.

I pleased to note the BBC reporting that Mehdi has been granted asylum in the UK, according to the UK Border Agency "We keep cases under review where circumstances have changed and it has been decided that Mr Kazemi should be granted leave to remain in the UK based on the particular facts of this case." Anything else risked his certain death.

Just say no

The NZ Herald reports on Auckland local government "Former North Shore Mayor George Wood and former regional councillor Wyn Hoadley called for a collective approach on economic and social issues to tackle issues such as health, housing, job shortages and education."
.
In other words a mega council to extend itself into social policy.
.
Care for a 100% rate hike anyone? As a start?

Lunatic left rabidly against private roads

According to the NZ Herald, Citizens Against Privatisation, a far left ginger group linked to the Alliance has suggested it would blockade a new tunnel built through Avondale if it was build using (shock) private money and built privately. Apparently the fact they wouldn't be forced to use it and pay a toll isn't enough for these fanatics. One Marxist claim is "This PPP is aimed at putting more of the load on to the poor and the working class". Actually if done right, it will be privately funded, private enterprise will operate the road and yes nobody will be forced to use it (absence of force is an alien concept to socialists who believe in forcing everyone to pay for things).

.

These nutcases, who presumably also claim to be environmentalists sometimes, would rather NON road users pay for it through income tax, than it be tolled. So a new road is built by subsidies from those who never use it. Great!

.

Now I DO have criticism of the Waterview extension of SH20, mainly because it is overpriced gold/greenplated and should only be built if the benefits exceed the costs or tolls can fund the road. I doubt either are true, which means it shouldn't be built for now. However, I'm happy to let the private sector buy the land and build it and toll it, if it thinks it can make money from it, but I doubt it is true. However if it could, the leftwing lunatics would stop it, because to them "private" is evil. However, they will no doubt align themselves with the equally lunatic Residents Action Movement (who have conspiracy theorists about road policy) and the "make everyone else pay for my water" Water Pressure Group.

Don't tell them there are private cul-de-sacs all over Auckland, they might blockade them with their dribble when they realise how they have existed for decades without them noticing - the outrage, those bloody World Bank IMF international military industrial complex banker types screwing the proletariat again (I'm only half kidding, one of their activists talked with some of that language to me once).

Simple way to cut spending

Here you go, don't spend money subsidising the racing industry, for the reasons Sue Bradford says "there will be many others who will feel mortified at the bad name their industry is getting through Government sponsored handouts to the rich". Ignore he call for spending the money on the losers in the racing industry, but hell - how many examples like this can just be dropped? Shouldn't the Nats be fighting this?

Green party voodoo economics

Green MP Sue Bradford has put out a press release advocating regional development specifically by asking Dr Cullen to invest (read - spend your money without your consent on something that wont generate a return to you) "in promoting more diverse economies, rather than each town putting all its hopes on one industry. Each of our towns and provinces needs a range of successful primary industry and manufacturing businesses providing diversity and strength to our local communities"

.

So she wants subsidies for business in effect, but she also says "It is obvious that benefit levels must rise" so she presumably wants to tax them more too. How putting up the price of labour and taxes for businesses in the regions is good for them is beyond me, and it's a bit much to hope that Sue's years in Maoist China before it reformed might have taught her something, besides Mandarin.

Shallow academic gets pay cut

The Melbourne Age reports that public transport evangelist Paul Mees of Melbourne University has had his pay cut after saying " the authors of a 2007 report on privatisation were "liars and frauds and should be in jail". It's called defamation you lunatic. He says it is an "attack on free speech". He claimed "the comments were not "insulting or derogatory"". What planet does he occupy?

.

Well it isn't earth. Mees has long been an environmental evangelist's pinup boy eager to damn any road building and cheerlead on rail and especially light rail projects (you know the sort of people who when talking about this sort of thing sound like they are engaging in foreplay), with rather appalling economic analysis. He's had a pay cut of A$8,000 a year as a result. I wouldn't hire the man for A$8. Tim Blair pointed out that Mees persists that cars are no more fuel efficient today than they were in the 60s and no more cleaner burning, both of which are ludicrous claims.

.

This same man claimed on the ABC once that the Melbourne Citylink toll road, which has been a roaring success, would be a failure and need taxpayer bailout.

.

Of course the Green Party quotes him, for their anti-road fanaticism, so beware - the media often thinks academics on a subject don't have a barrow to push. Paul Mees is a leftwing, environmentalist car hating light rail enthusiast. If you ask for his opinion, I'd approach Wendell Cox for a rebuttal - and watch the sparks fly.

.

Hat Tip: Tim Blair

The ex.monopoly moaning about the competition

Imagine if you had a statutory monopoly on your business since your sector came into existence, in other words for a total of 29 years. Imagine if your first competitor was required to tell you, four years in advance, all of its products and the timing of their release, so you'd know when it started exactly what to do to ruin its chances. Imagine then that when the market was opened up, you bought extra capacity to compete with your new competitors and allied yourself with one of the emerging players.

.

Now some 17 years after the market being fully open, it's all a bit hard and you're moaning to the government that one of the new players is so successful, it's unfair.

.

Of course I forgot to say that the company in question is 100% state owned, that the government since 1999 has had no interest in privatising it and stymied a plan to directly take on its competitor shortly after it won office.

.

I am talking about the arrogant self styled guardian of "kiwi kulture" TVNZ. TVNZ, of course, gets some money from the taxpayer to pay for programmes that viewers wouldn't otherwise pay for. Sky gets nothing. TVNZ inherits its rights to broadcast, Sky had to bid commercially for its UHF frequencies and now pays commercially for satellite broadcast frequencies. Sky's customers CHOOSE to pay to have its channels available, and Sky offers around 60 channels plus radio. TVNZ offers 4. Sky started from nothing in 1991, with 3 pay TV channels and lost money for around the first decade of its operations. TVNZ was government funded and enjoyed milking NZ TV advertising monopoly until 1989.

.

Do I smell the whiff of loser? Now TVNZ could have performed better had it been privatised as it could have invested in pay TV, more channels, and spent money on programming people wanted rather than being the Prime Minister's plaything (it is rumoured than when TVNZ dropped BBC World from TV1 overnight because of the high price the BBC charged, the PM rang the TVNZ CEO and demanded it be reinstated - of course Sky offers BBC World 24/7).

.

TVNZ wants the government to ban Sky from bidding for the broadcast rights for certain sports events, presumably so TVNZ can pay the sports event operators less so it can attract customers to watch it for nothing (even though hundreds of thousands are willing to pay). It can't seem to convince advertisers to pay enough for the programming compared to how much Sky can convince subscribers. Too bad TVNZ. It calls Sky subscriptions a "sports tax". No! It's not a tax because it is voluntary, but then the socialists at TVNZ maybe don't quite get that, having been friendly to statism for many years.

.

However it goes further. No doubt buoyed by Labour's decimation of Telecom's property rights, TVNZ wants Sky forcibly split into two businesses; one to buy and manage programming, another to operate satellite transmissions and set top boxes. What?

.

This is the same TVNZ that once owned BCL (now Kordia). This is the same TVNZ that holds the two highest rating commercial TV channels, and for years dominated the free to air broadcast market because it advertised its own programmes for free on its own channels. I guess the inherited monopoly benefits have been eroded by the market.

.

Sky was one of three pay TV businesses that have had a reasonable presence in the market. Telstra Clear is second with its cable TV operations in Wellington and Christchurch, and Telecom was a third with the long defunct First Media cable TV operation in parts of Auckland and Wellington. Ihug also briefly ran a pay TV operation. TVNZ could have done so too, but government has prevented it from doing so.

.

TVNZ wants a "level playing field". What, you mean having a 31 year head start wasn't enough? It wants "media diversity", when it spent several years in court in the 1980s fighting a third TV channel, and itself bought one of the seven nationwide UHF TV frequencies when they were first sold (and had a 25% interest in SKY which bought four others).

.

You see 720,000 households subscribe to Sky - that's people choosing to pay for TV. Unlike the hated TV licence fee which people DIDN'T choose to pay, but which predominantly benefited TVNZ.

.

Quite simply TVNZ are moaning losers, it has milked TV advertisers for decades, milked taxpayers and the TV licence fee paying them by force for what people wouldn't otherwise choose to buy. Sky comes along, offers programming people want to pay for, and TVNZ thinks it is unfair.

.

It should be privatised, in full - it is an arrogant broadcaster that specialises in vapid oversimplification of issues, "to make them relevant for the viewer" by treating news like a sports match "good vs bad". It has overpaid so called "stars" that it creates, and almost never challenges the statist status quo, and warmly embraces those who want more government or government to fix problems.

So go on TVNZ, charge subscribers for your content, and see how well you go or maybe just ask your masters to sell you to someone prepared to invest in developing your business. Don't get upset because the relatively new boy on the block is outdoing you right left and centre.

Libertarianz announce mammoth tax cut

Well, following on from ACT taking the Libertarianz tax policy from the last election of making the first $10,000 of income tax free, Libertarianz have announced a new tax policy with its alternative budget. All the details are here on Pacific Empire, but the key points are:

.

- First $50,000 of income tax free;

- Abolish GST;

- Public expected to buy healthcare, education, superannuation and insurance against misfortune if they so wish;

- Privatise hospitals and schools by giving away shares in them to the public;

- Privatise other state assets not essential for law and order and defence;

- Proceeds of privatisation to fund residual national superannuation, ACC and invalids benefit obligations, and a three year phase out of the DPB;

- Significantly increase defence spending to rebuild blue water navy and strike capabilities.

.

So there you go, if you want to send a message to politicians that you want your money back, vote Libertarianz. Although I'd like to know the rate of income tax about $50,000 (it was 15% in the previous policy I believe). Now I'd fiddle a bit with some of these policies, but they represent a bold message of cutting back the state to its core functions.

New blog rankings

Tim Selwyn has kindly published his latest NZ blogosphere rankings, for March/April. No point in going through the results, but I am glad to say that my ranking is up to 34 (from 51) and Not PC from 6th to 4th place, knocking back Frogblog and No Right Turn (two of the leading leftwing blogs).

.

The rankings are interesting for listing some blogs I never new existed. Others than have significantly gone up OR down (by at last 14 places) in the top 50 are as follows, with the previous ranking followed by where they are today according to Tim. Inastrangeland (gone from 41 up to 26), Silent Running (16 to 30), Craig Foss MP (81 to 31), Hot Topic (68 to 35), Maia (23 to 38), Big News (29 to 47), Aotearoa a wider perspective (69 to 48).

.

I know I'll be looking at the blogs I've never seen before to check if they should go on my blogroll or my regular feed, just to see what is interesting.

A different 20 point pledge card

Ok, having reviewed ACT's effort and marked it as being, at the very best, barely a pass, here's my go at it. This is NOT Libertarianz policy, consider it maybe a halfway house between it and National, in other words what I think a bold ACT could say.


1. Government waste. Cut all government spending to the lowest of the OECD: These means cutting local government as well as national government, and being bold about waste. A smaller government than New Zealand's competitors is more ambitious than matching Australia, which is bloated by mineral wealth.

2. Cut and flatten tax rates: OK, time to repeat the already announced policies of having the first $10,000 tax free, abolishing the 39% top tax rate AND abolish the 33% tax rate. Drop company tax to 19.5%. That means flat tax at 19.5% for all.

3. Limit local government to core activities: Abolish power of general competence and cap rates, permanently (no inflation indexation). Councils would need to find new ways to raise funds (no new tax powers), and cut spending. Councils would be prohibited from entering into new activities, from subsidising businesses and the arts.

4. Reform the public service: I don't care about limiting Parliament or Cabinet, but let's require all departmental CEOs to give a report within one month of office explaining what would happen if the department was abolished. All must give two options. Those that aren't convincing would be abolished. CEO's of Ministry of Womens' Affairs, Youth Affairs, Families Commission and numerous others would be better resigning and using the time to find a real job.

5. Red tape: Require remaining government departments to report on options to eliminate costs to business, and rely upon contract, tort and private property rights instead of licensing and regulation.

6. Reform the Resource Management Act: Amend the RMA, to make private property rights pre-eminent, and make its primary purpose the extension of private property rights onto rivers, foreshore, seabed, airspace, sight lines, air quality and the like. In other words, create private property rights to enable owners to do as they wish with their OWN environment. Of course it wouldn't look much like the RMA any more.

7. Create a competitive market in education: Yes to education vouchers, extend it to university, but they should only cover half the cost of tuition. Abolish state involvement in early childhood education. Give schools full autonomy on pay and curriculum, make each school into an independent corporate entity.

8. Same in healthcare: Offer insurance model in exchange for tax cut, payment of premiums. Public can opt out of state healthcare and switch insurance providers, or can choose state healthcare which receives budget based on hypothecated tax revenue from those paying for it. Make all government healthcare facilities into businesses again.

9. Reintroduce competition to accident compensation: Competition for employer, motor vehicle and personal accounts. Compulsory cover with review to consider merits of returning right to sue for personal injury by accident.

10. Welfare: Support ACT's announced policy of shifting welfare to unemployment, sickness and invalid insurance, extend to DPB and transfer Kiwisaver to individuals to ultimately replace national superannuation.

11. Immigration: Open door with the following limits. No right to claim welfare or social assistance of any kind. No admission for those convicted of crimes that have NZ equivalents. Must have financial means (or sponsorship) for at least 3 months and airfare to return.

12. Labour reform: Shift employment law to contract law, abolish minimum wage.

13. Privatisation: Sell and give away shares for all SOEs, give away shares in hospitals, schools to the public.

14. Infrastructure: Abolish electricity and telecommunications commissioners. Return Telecom's property rights in its infrastructure, and abolish laws requiring cellphone operators to resell competitors' services. Convert Transit NZ into an SOE and privatise Auckland Harbour Bridge and its approaches, allow road users to contract directly for road use and opt out of fuel tax. Require local authorities to transfer roads into SOE equivalents. Privatisation of water/sewage.

15. Cut the remaining tariffs on imports: Perfect.

16. Free up more land for housing: Abolish urban growth limits, privatise state housing by offering Thatcher style "buy your state house" scheme, use RMA reform to reintroduce private property rights.

17. Strengthen law and order policies: Yes private prisons and get the private sector to do Police work that ISN'T about arrest (e.g. assistance, traffic control) and speed up the courts. However, introduce "points" scheme for crimes. If a criminal gets 100 points, it is permanent detention. Good behaviour inside allows for a 10% discount on sentence and points. Full review of all criminal laws to eliminate victimless crime, legalise medical use of cannabis and review laws on drugs consistent with changes to health and ACC policy (to ensure individuals are accountable for their actions).
.
18. Climate change: Declare climate change policy to be abolition of subsidies for activities likely to be contributing to climate change (in fact all activities), and reducing taxes on low emission activities (and all activities). Abolishing transport subsidies and price controls on energy will help too. Quite simply, taking pro-freedom steps that are consistent with trying to reduce the theoretical impact of climate change, but nothing else.

19. Strengthen our constitutional framework: Yes to a Taxpayers' Bill of Rights, but also abolish the Maori seats, include private property rights and right to control one's body in the Bill of Rights, and eliminate references to the Treaty of Waitangi in all legislation.

20. Appoint mentors to families at risk: All very well and good, but to help this along, abolish additional welfare for children born to families or individuals already in welfare. Also deny convicted serious violent or sexual criminals the right to custody or cohabitate with anyone under 16, or the right to welfare. The stick as well as the carrot.

So there you go, it felt rather unambitious not scrapping the RMA, not introducing a libertarian constitution, not fully privatising schools and hospitals or the roads, or legalising drugs, but well this isn't for Libertarianz, it's for ACT. What do you think?

An idea for Dr Cullen

Given he is buying not only Toll Rail's business and trains, but also the monopoly of track usage that the government let Toll keep when it bought the tracks, the report in the Dominion Post of a private company (Manning Group) willing (apparently) to invest in running new trains on the Wellington-Auckland line is promising.

.

It shows that, perhaps, the right approach would be to sell track access to whoever is willing to pay to run trains, it may be on an exclusive franchise arrangement. In other words, private companies paying to use the otherwise worthless tracks. It does mean Dr. Cullen sharing his train set with others though. Now I don't think the Manning Group's idea makes good business sense at all, I can think of better ways to invest money that in a transport mode that takes 9 hours, when three companies fly you in an hour, but if it is their money and their track access isn't subsidised AND it stops Dr. Cullen paying for new trains to replace the Overlander, bring it on! I'm convinced that entrepreneurs can do better than the state.

The dangers of collective thinking

The Dominion Post reports on a study from Massey University that claims that migrants from the Pacific Islands are a drain on the economy. It makes a number of claims such as:

.

- Pacific Islanders are more likely to be unemployed;

- Pacific Islanders are less likely to start businesses and be self employed;

- Pacific Islanders have proportionately higher rates of prosecutions and convictions;

- Pacific Islanders are more likely to be victims of violent crime;

- Pacific Islanders are more likely to need welfare including housing subsidies;

- Pacific Islanders on average perform poorly at education.

.

The author Dr. Greg Clydesdale also suggest that "because of high fertility and current immigration levels, New Zealand will have a significant population that can contribute little to economic growth".

.

Now such a study is probably meant to indicate there are problems, somewhat cultural around crime, business and education, that Pacific Island communities ought to address if they wish to perform better. This is not something the state can do, and it would be wise for Pacific Island community leaders to listen and consider what value this study may bring. Greater belief in education, confidence to establish businesses and a rejection of welfarism could do a world of good, and I am sure quite a few Pacific Islanders already do that.

.

However, it will be jumped upon by collectivists of the left and right to condemn and throw blame, when in fact it ignores one simple point - many other New Zealanders are criminals, unemployed, lazy, poorly educated and "contribute little to economic growth", and many Pacific Islanders work hard, and live quiet lives not bothering other people.

..

Collectivists on the left will blame "society" or "government" for not doing enough for Pacific Islanders, it will claim some don't understand criminal law, some don't get enough welfare or help from the state. The Labour Party sits nicely in that category. Some on the left may call the study racist, dismiss that Pacific Islanders are to blame for their fate and say it is up to everyone else to address it - in other words, Pacific Islanders are on average poorer and committing crimes because they have been failed by others.

Collectivists on the right will say migrants are a drain, there should be less of them and they are "not like us" and we shouldn't "let them take our jobs and money". This may well be Winston Peters and NZ First. Interesting that he keeps Labour in power too.

What I say is simple. Pacific Islanders should be seen as welcome, as are other migrants. However, they are responsible for abiding by crminal laws in New Zealand, and one of the first reforms of the welfare state should be to deny new migrants access to subsidised housing or welfare. Migrants should not come to New Zealand expecting to live off the state.

.

You see it doesn't MATTER if Pacific Islanders or anyone doesn't "contribute to economic growth" as long as they don't live off of the state. They don't exist to contribute to ANYTHING, other than their own happiness, and as long as they don't expect everyone else to be forced to pay for them, then it shouldn't be anyone else's business.

Dr Cullen thinks it's inflationary if you spend your money but not him

According to the NZ Herald Dr Cullen continues to trot out the bizarre belief that a tax cut could be inflationary and reckless, but HIM spending YOUR money can't be. Sorry?

.

So buying a railway business at a price well beyond its market price isn't inflationary? Oh no, of course not - given the money goes to an Australian company.

.

Dr Cullen, the money you spend wasn't earnt by you, wasn't created by your effort. A majority of New Zealanders want some of it back, that is why it is highly likely you wont be Finance Minister at the end of the year. The big question is by how much will the Nats help voters out.

Advance auction of stolen goods

It's up to virtually NZ$4 billion from Labour and NZ$1.6 billion from National so far according to the NZ Herald, and keep counting.

.

That's YOUR money they are promising to spend, to bribe you for your vote. Of course, odds are you wont benefit from much of it, but a few of you will benefit a lot.

.

That's what the election is primarily about, Dr Cullen/Helen Clark and John Key/Bill English trying to convince you that they can buy more of what they think you want, whilst planning to pilfer it from your back pocket in the first place. Ask yourself why those who benefit from government spending SHOULDN'T pay for these things themselves and if they couldn't afford it, what if they got some of their taxes back? If then they wont pay, then maybe they don't want it that much?

.

Now there is the hope they both will have an auction of giving you your money back, but think how much more you could get back if they weren't auctioning the spending too.

Using Koran as target practice

This widely reported story raises some simple points:
.
1. It's a book, those who get upset about it happily ban and burn books themselves.
2. Notwithstanding that, it was not a clever thing to do in a predominantly Muslim country.
3. However, it's telling how upset so many Muslims get about this, but don't get agitated about honour killings, rape victims being executed, sentencing teenagers to death for having consensual sex, or death for adultery. Yes, the priorities of far too many Muslims are - book first, lives second (sorry I mean female lives third).
.
Oh and if anyone wonders how i'd feel if a copy of The Fountainhead was used as target practice? Well if it was by a US soldier, I'd say he was an idiot, but it's his right to free speech. If it was the Bible I wouldn't care less, but I suspect many in the US would be calling for his head.
.
You see as much as I know how it isn't clever to deliberately insult others for the hell of it, it is more important to realise that nobody has a right to not be offended. I find all the points I listed in "3" above to be infinitely more important than any single book - I'd like to hear from Muslims who agree.

Scoring ACT's 20 point plan

Act's come up with its own version of Labour's pledge card and seems to be showing a bit more backbone than it ever has before. Of course perhaps it was a political miscalculation to have 20 points, as nobody will remember most of them. Far easier to have 3 or 5 at the most as the key messages, but we'll see if this fires up enough of the public to give ACT a go. Rodney Hide's speech on Sunday where he announces the 20 point plan has some juicy tidbits that are hard to disagree with:

"Who would you trust to manage New Zealand's $175 billion economy in a crisis?

Michael Cullen - who's squandered the best global conditions of a generation to make us poorer than Greece?

Bill English - who did nothing much the last time he was Minister of Finance, and is proudly promising to do nothing much again?

Or Sir Roger Douglas - the Finance Minister who transformed New Zealand from the East Germany of the South Pacific into one of the freest and most respected economies in the world?"

Quite.

So what are these 20 points? Are they substantial, or are they waffle and would they make a positive difference? Here's my verdict one by one (this will take some time). I'm judging ACT on clarity of policy and contribution to economic or personal liberty. To make it slightly more interesting I'm giving up to 5 points for being bold:

1. Government waste. Cut state spending to Australian levels: I presume this means as a proportion of GDP, but isn't entirely clear. This is clearly positive, modestly ambitious, but only worthy of 2 points, after all Australia is far from free from government waste.
.
2. Cut and flatten tax rates: Well yes, but what does this mean? This could be anything from getting rid of the 39% top tax rate to promoting a single flat tax rate. Last election ACT promoted a two tier rate of income tax, in 1999 and 1996 it advocated flat taxes. Make your mind up. Lack of clarity shows lack of commitment to what this means. National may cut tax rates and you flattening is a point further, so onl