The wealthy deserve their wealth??

Kia-ora

One of the recurring memes is that the rich earned their wealth because of some innate superiority, extra effort or extra talent,  and it is churlish to take some back off them..

Those at the top, got there, mostly, because of A) inherited wealth, B) the old boy network. (The real advantage of private schooling). C)total psychopathic self interest and disregard for others. (Called theft when done by those at the bottom).
They would have us believe that they have some special talent or superiority that justifies their wealth.

Anyone who watches the Kardashians can see that inheriting wealth is no guarantee of superiority.

Ridding them of some of their money makes for a more efficient economy and a fairer and more decent society.

Why do they have more right to the wealth produced by the workers in society than anyone else whether they work or not.

Jobs and livelihoods exist because there is a demand and need for them. Not because of money capital.


Also! Not because of the owners of capital. Recent events have shown, that, given free rein, the owners of capital hoard it and gamble it. AND expect taxpayers to bail them out when they lose.

The owners of capital are sitting on trillions at the moment. Extra 20% more wealth went to them in NZ this year. Where are the jobs??

Do you really think that if the owners of, say, supermarkets, in NZ withdrew their capital some entrepreneurs would not arise to fill the gap.

Democratic Socialists do not say we take all the money back off them.

Though as it is undeserved and unearned the communists may be right.

Taking capital of these people who tend to mispend, and gamble it, to enable more to those who spend and use it wisely, is economically and socially effective.

A very few get to the top because of effort, learning skills, entrepreneurship, producing something that a great many people value or by talent.

This is so rare however that these individuals are celebrated in the news.

Those deserve their money.

It is interesting though, that most of these people recognise that the social benefits from society, such as State education, helped them on their way and they are happy to give back in some way.

Don’t usually see them demanding less taxes.

Many more who could or would be entrepreneurs are constrained because A,B and C above take the wealth earned by us and waste it. Or use wealth to limit competition from below. Opposing all attempts at upward mobility. E.g. Dumbing down public education to the 3 r’s only to avoid the children of the “lower classes” from competing with their pampered darlings.


Don’t forget those who really produce the wealth. The wealthy would not survive without all of the workers. Even entrepreneurs need staff.

On Retirement Pensions and the Age of Entitlement.

Kia-ora

On Retirement Pensions and the Age of Entitlement.

What was wrong with the surcharge?

This is a mantra. “We cannot afford superannuation” which has been repeated so long and so often that even those who should know better repeat it.

And what did Government’s do with the more than a million, in today’s dollars, I paid in tax that they cannot afford to pay me a small proportion on retirement.

Do we really want to return to the days when most elderly people were totally impoverished when their working lives ended.

In fact super has been so effective in removing poverty amongst the elderly it should be extended to everyone in the form of a guaranteed minimum income. There is no excuse for having people with inadequate food and housing in a country which is capable of supplying an excess of both internally.


Super and other benefits are easily affordable if those who get the most benefit from our society paid their fair share.

We are fast becoming a country which does not look after its children, the sick or the old.


What does that say about us?

The Green Alternative.

Kia-ora

The New Zealand Greens show there are credible alternatives to National's Neo-Liberal slash and burn.

Some Alternatives for a Green budget.

In fact they have been advocating socially and environmentally responsible alternatives for some time.

The Green new Deal.

Media prefer to ignore sensible discussion of policy to concentrate on sound bites and irrelevance about celebrities.

The Labour party is "missing in action". I suspect they feel that New Zealand is so unrecoverable, after 30 years of Neo-Liberal "stuffing" that they do not want to be in power

Nothing is worth killing for?

Kia-ora


Are we really civilised?

"I'm an extremist in this debate, I will freely confess. I hold an absolute view that no killing is ever justified, that individuals have the necessity to defend themselves against assailants, but that even that does not grant moral approval to snuffing out the life of another. Don't even try to pull out a scale and toss a copy of the Koran on one side and the life of a single human being on the other — the comparison is obscene. Do not try to tell me that some people are 'moderates' when they tolerate or even support and applaud war and death and murder for any cause, whether it is oil, or getting even, or defending the honor of wood pulp and ink."

We have to think about the effects of the things we do.

Are oil, religion, status really worth so much to use we have to kill others for it?

Is retaining wealth so important that we can starve children to death, even in wealthy countries, rather than give up a small portion of that wealth?

Once upon a time conservatives also believed in prosperity for everyone. Now the Neo-Liberal version  will happily kill, maim and starve to add to their individual wealth.

Those who believe their religion, wealth or power is worth killing for.

Are evil.

Vote National for lower wages, lower business income and higher costs.

Kia-ora

This is what they plan to do.

• The average real wage of the non-supervisory production workers (which comprise 82.4 percent of total private non-farm employees) actually declined by 9 percent between 1975 and 2010.

• Meanwhile the top 1 percent saw their share of national income rise from 8 percent in 1975 to 23.5 percent in 2005

• More amazing still, the wage gap between the top 100 CEOs and the average worker jumped from $45 to $1 in 1970 to an unbelievable $1,723 to $1 in 2006

• Today after the crash, financial incomes are so enormous that in 2010, John Paulson, the top hedge fund manager, earned $2.4 million an HOUR (not a misprint), and his tax rate is less than yours

Sound like New Zealand recently?

Continue the transfer of wealth from working New Zealanders to overseas corporates.

Tax and Welfare reforms. Towards Solutions.

Kia-ora

Discussion in the Standard.

70k is the median family income. I agree it is hardly rich. Progressive taxation should start about 140k. Equivalent to 30k, about the level of the top rate in 1980. Cuts to the top rate plus leaving the tax on middle incomes to go up by bracket creep and user pays has resulted in a decreasing disposable income for 80% of New Zealanders.


“The so called reforms in the 80′s and 90′s resulted in a drop in income for the majority, 80%, over the period”
“Since there was little income growth, the net effect of the fiscal changes was to switch income from the poor and those on middle incomes to the rich”.
http://www.eastonbh.ac.nz/?p=333
.
http://home.nzcity.co.nz/news/article.aspx?id=120821&fm=psp,nwl
“Weekly incomes have stagnated since 2008.”
http://www.rbnz.govt.nz/statistics/0135595.html
“Incomes for most people, have dropped since the 70′s”.
“Almost constantly apart from a brief slow down of the drop from 2000/2008″.
“For the middle class in skilled jobs it has dropped 40%.”


People are borrowing to live because NZ incomes have dropped below costs..


A better option may be to simplify all welfare, tax and tax rebates into a minimum individual income administered through IRD. With a flat rate up to 200k after that. Those earning over 200K are benefiting the most from our society, so should pay the most towards it.
The difference can be made up with FTT’s, a CGT on all but the family home (up to twice the mean house price) and pigonian capital control taxes.

Neo-Liberalisms "success" in New Zealand

Kia-ora

Since 1984

Neo-Liberalisms "success" in NZ.

 "Between 1985 and 1992, New Zealand's economy grew by 4.7% during the same period in which the average OECD nation grew by 28.2%. From 1984-1993 inflation average 9% per year, New Zealand's credit rating dropped twice, and foreign debt quadrupled. Between 1986 and 1993, the unemployment rate rose from 3.6% to 11%.

The Labour Government in 2000 to 2009 reversed some of the Neo-Liberal policies while keeping within the same general path, leading to their defeat by a disappointed population. Economic and social indicators where rising briefly until  a National Government determined in reinforcing the Union and beneficiary bashing policies was re-elected.. We are now continuing in recession as the rest of the world climbs out.

Social and economic indicators have resumed their downward slide in unison with the other Neo-liberal econom ies, USA and the UK.

The Welfare Crisis

Kia-ora

The ongoing plot to starve New Zealanders into submission continues.

Shock-doctrine

Wages and benefits are not dropping fast enough for some people.

Neo-Liberal thought in action. Manufacture a crisis so they can redirect more wealth from ordinary people to them selves.

If-only-those-poor-people-would-stop breeding

"I am revolted by the wealthly, well-educated, well-resourced people who wrote the Welfare Working Group's final report suggesting that all would be well in this country if only the poor people stopped breeding."

The effective way to stop women having lots of kids, as we all well know, is to raise their expectations, possibilities and standard of living.

 Though the problems have been greatly exaggerated by the working group, whose real agenda is cutting tax  for the really wealthy by punishing those their Neo-Liberal meanness has deprived of a future.


On the welfare working group.

"and accept any ‘reasonable’ job offer they get) when their baby is only 13 weeks old. It would be interesting to know which WWG panel members baulked at this proposal. Maybe it was the health specialists, because they realized the danger to the wellbeing of children that this crackpot idea would pose? "

How can there be any real economic benefit to pay to put young children in to childcare while forcing their mothers to work.

Maybe we should limit the children of the wealthy as they will grow up to consume far more than their share of the worlds resources.

Or accept that welfare is part of any functioning society.
Myths-about-welfare.

Yeah we should be doing something about those on State welfare.

Kia-ora

Yeah we should be doing something about those on State welfare.


Banks and finance companies who fail with Government guarantees. And the insider traders who buy into them knowing they will fail and be bailed out.
Employers who can pay low wages because the state takes up the slack with WFF and childcare allowances.
Poor employers who drive good ones out of business because labour laws are so slack.
State owned companies given away to corporates for cents on the dollar.
External subsidies from ratepayers to dirty Dairy.
Employers given handouts to employ people who then get rid of them when the subsidy ends so they can get someone else who is subsidised.
Employers whose workforce are trained by the State..
Banks getting windfall profits when the OCR is raised.
Currency speculators who short the NZ dollar.
Really wealthy people who use a larger share of the countries resources, but structure their affairs so they do not pay taxes to cover their costs.
Fathers who use trusts to avoid paying child maintenance.
Farmers who have their hands out when they have floods, but do not have any taxable income.
State funded Police protection against people they have disenfranchised.


Politicians who accept an income from the people of NZ, while they sell them, and the country out, to their sponsors from private corporates.



Yep we really do need to cut welfare.

The myth of wealth creation.

Kia-ora

The myth of wealth creation.

Despite the mantra that wealthy people create jobs this is not really the case.


Job creators/wealth creators are more often entrepreneurs who created the business and the jobs first and then became wealthy.

The most wealthy people in NZ at present became wealthy by destruction.

Asset stripping, closing businesses and removing capital so they can invest it in much more lucrative financial juggling.
Taxing these sorts of activities more with FTT’s, capital flow restrictions and CGT’s would be a huge benefit to the economy.


The advocates of Neo-liberalism, deregulation and taxing the wealthy less reckoned they would then invest more money into productive business and employment. In fact investment in business dropped 2/3 since 1980, many successful businesses were closed down for short term capital gain and employment in manufacturing and value added exports plummeted.


If the Government was serious about stimulating the economy they would have increased benefits and the minimum wage instead of borrowing to cut taxes to people who mostly spend overseas in luxury goods or paying of loans.

Businesses are shooting themselves in the foot by advocating that their customers be paid less.



People with gumption are leaving the country because there is not enough spare cash in wages and benefits after paying for essentials to buy products from a new business. (That is if their measly wages allow enough earnings to leverage into starting a business and they can get capital from a finance system that earns more in gambling than business investment)

As I can tell you from personal experience there is no point starting new business in a low wage country that cannot afford anything beyond necessities.
Skilled and talented employees are leaving because employers are allowed to use immigration, subsidies like WFF and union busting rules to pay less than the job is worth.  Potential Entrepreneurs  have no spare cash to leverage their own business, even if the demand was there..

Stimulus and demand.

Kia-ora

Shows that unemployment is due to weak demand.

Unemployment is due to weak demand, not structural.

"Structural unemployment – unemployment stemming from a mismatch of workers' skills and job requirements – has been cited in mainstream media as the main cause of current, high unemployment. Data from the National Federation of Independent Business (NFIB), however, suggest that structural unemployment is not what is ailing the economy. The graph below draws on data from the NFIB's monthly survey from December 2007 (the official start of the recession) to January 2011. Each month, the NFIB asks its sample of small businesses to state the single most important problem facing their business today. Since the recession began,
 respondents overwhelmingly have cited "poor sales," suggesting that today's unemployment is primarily due to a lack of demand. "Quality of labor," the factor most consistent with structural unemployment, barely made the list."


Keynes was right.

"Keynes was right and classical economics wrong. The economist John Maynard Keynes argued that the market has its limits. Most markets work well most of the time, but financial markets left alone are prone to dysfunction, and an economy stuck in a rut can stay in a rut for some time. Thus the necessity of the stimulus".


As we have been saying a low wage economy cannot afford to buy much and tax cuts to high incomes have failed to stimulate demand.

Increases in minimum wages and benefits would benefit small and medium enterprises.

Business are shooting themselves in the foot by asking for a low wage economy and cuts to Government spending.

Myths about welfare.

Kia-ora

We all hear the recurrent myths about welfare. Like thousands of young girls breeding for the DPB. In fact most DPB recipients are divorced older women whose ex partners are not giving the support they should. Hardly The women's  fault.

Or the many DPB fraudsters supposedly ripping off the system. The fraud unit of WINZ found 16 million worth of fraud in 2008 or .01% of benefit [payments. And! most of the fraud was by staff.

The banks defrauded us of 2 billion dollars last tax year. A large proportion of the SCF payout was to insider traders who knew they would make a profit from the bailout.
National are costing us 300 million a week for election bribes. They are proposing to defraud us of even more with asset sales to increase the profits of asset strippers and incompetent managers.


Who are the real bludgers???


Ten-myths-about-welfare

Why in a decent society we should support social welfare.

Kia-ora

Frank Ritchie has a good piece here on why we should support a social welfare system.

On why social welfare is something we should do..

"It is becoming increasingly apparent that there are growing prejudices in our country targeted at those who receive a government benefit. Note, we’re not talking about subsidies in the agricultural industry, bail-outs for investors who took risks in finance companies that have failed or high income earners who shift their capital around in order to access government benefits – somehow they are exempted from the seething anger aimed at beneficiaries. The targets for the prejudices are those who access the unemployment, invalids and domestic purposes benefits. In many people’s eyes these are a different breed of receiver of government money than the others.".

At the end of the day most beneficiaries are us, given a bit of bad luck, an accident or prolonged illness away.

The Neo-Liberal Promise??

Kia-ora

 All of the mantras from the Neo-Liberals that have been proved false.

Kicking away the Ladder

"Decreasing tax rates will increase overall tax take".
Only if taxes on middle incomes were excessive and the tax payments were being wasted. Like under Muldoon with social welfare for farmers and business. As we have seen recently decreasing taxes to the wealthy drops the overall tax take.

"Decreasing wages will free up business capital to invest in making business more productive".
In fact investment in productive business in NZ dropped to 1/3. Savvy business people know that low wage earners cannot buy much. SME's have been feeling the pinch every time NZ incomes have dropped.

"Letting the very wealthy keep more of the money will result in wealth trickling down and all of us being better off". Like feeding the cow more grass and hoping for better fertilizer.

"Privatising public services will result in cheaper and better services".
Yeah right. Like the US health system. Our rapidly dropping power prices.

"Running State owned enterprises like corporates will make them more efficient".
See above also refer to ports and railways. Managers are multiplying like fleas as they cut services and staff.

"Labour productivity needs to be increased before wages can increase".
Rob and CV have just covered that one. 82% increase in productivity. Skilled wages have dropped. Average up 18% only. The-productivity-lie

Globalisation and free trade will make everyone better off because of comparative advantage".
Wall street and some multi-national corporates get better off. The world pays through the nose to keep them in riches.

"Pay huge salaries to managers and you get the best".
UK research shows the higher management salaries are in relation to the rest of the staff, the worst performing the company. Germany and Japan get good managers while only paying about 4 times a workers salary.

"Taxes are a drag on the productive economy".
Well actually the USA economy was at its most productive when top tax rates were 91%. The best performing economies at present are the most taxed. Comparative tax rates.

"The State sector is non-productive while the private sector is productive".
So Doctors, Teachers, Universities, public research, Regulators don't contribute to the economy while finance houses, beer advertisers and gamblers in financial derivatives do. Yeah right!

"We will all have to accept austerity and a lower standard of living now for gain later.".
The majority of the population must accept less so the top 0.5% can continue to steal the results of our work from us. Waited 35 years so far.

"Selling income earning assets we already own will make us richer".
New Zealand's rich have spent the money they made from stealing our assets in the 80's and asset stripping. After burgling the share market as well they have proven so inept at adding value they need more public assets to play with.

"Tax cuts to the richest stimulate the economy."
No. extra income to the low paid and beneficiaries does because they spend it locally.



"Beneficiaries are a drag on the rest of us".
Beneficiaries are us. They are us one prolonged illness or some bad luck away. Cheap income insurance. Beneficiary income comes straight back as business income , taxes and wages.
Unlike 1.7 billion payments to insider traders in finance companies. Unlike tax cuts to the already wealthy which goes into US derivatives gambling.

Lunacy is expecting doing the same thing again and again to have a different result.

On youth rates.

Kia-ora

After the huge success of youth rates in reducing youth unemployment an ACT mp now proposes special lower rates of pay for Polynesian and female workers. He said "it is well known that reduced rates increased access to jobs for disadvantaged youth" and expects them to work the same magic for women and Maori.
"Once we get people used to the idea that reducing pay increases job opportunities, we will have 100% unemployment by reducing all wages to zero".
"Employers will become prosperous with zero wages and tax to pay",
WFF will be extended to all workers to complete the privatisation of profit and socialisation of losses'.
"At the same time police powers will be increased to prevent the poor from invading our gated communities and stealing our property".

Kia-ora

Paul Krugman analyzes the strange persistence of Neo-Liberal thought despite the total failure of Neo-liberal economics to deliver.
http://www.nytimes.com/2010/12/20/opinion/20krugman.html?partner=rssnyt&emc=rss

"How, after the experiences of the Clinton and Bush administrations — the first raised taxes and presided over spectacular job growth; the second cut taxes and presided over anemic growth even before the crisis"

More on Neo-liberal motivations.

Kia-ora

The 9/11 nihilism of GOP senators - Opinion - Al Jazeera English


"Yet, this latest stunt, well, this one even shocked me. Senator McConnell’s boisterous brood decided that it was too expensive to fund healthcare for 9/11 first responders. That’s right, the guys and gals who ran into cascading buildings, brick bonfires and smoldering ash, many of whom - the ones lucky enough to get out alive - developed respiratory illness and cancer for their troubles".

The madness continues.

Kia-ora

Meanwhile, as the neo-liberal circus carries on, China is spending as much of their US dollars as possible in buying concrete assets and resources before the $US becomes as valueless as blankets and beads.

New Zealand continues to invest pension and other funds in $US investments (Money market gambling)..
Without the productive capacity and income within NZ to support pensioners and other investors in future it does not matter how much is saved. Re-introducing money into an economy which does not have the capacity to absorb it simply inflates that money to the degree the goods and services are not available.

The money would be better invested now in NZ  in infrastructure, education (For useful jobs such as the trades and engineering) and sustainable energy efficient production to ensure our kids have a future. And so the can keep us in old age.

That is if the US$ has not inflated to be almost valueless because there are already more dollars floating around than can ever be redeemed by future US productivity.

The shadows behind the National figureheads.

Kia-ora

Some idea of the motivation behind the NACT's Labour and bene bashing. Making the world safe for corporate doners.

"January 21, 2010 will go down as a dark day in the history of American democracy, and its decline. The editors of the New York Times did not exaggerate when they wrote that the Supreme Court decision that day "strikes at the heart of democracy" by having "paved the way for corporations to use their vast treasuries to overwhelm elections and intimidate elected officials into doing their bidding" -- more explicitly, for permitting corporate managers to do so, since current laws permit them to spend shareholder money without consent."

Does this sound like NZ.

Kia-ora

"But what’s worse is the growing evidence that our governing elite just doesn’t care — that a" 

The arrogant disregard of ordinary people in NZ is just an imitation of the States.

It is time the strip mining of the people and country of New Zealand for the benefit of as few is stopped.