Sunday, August 29, 2010

Does this sound like NZ.


"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.

Saturday, August 28, 2010

A working class hero. One of the great speeches.


"Government by the people for the people becomes meaningless unless it includes major economic decision making by the people for the people. This is not simply an economic matter. In essence it is an ethical and moral question for whoever takes the important economic decisions in society ipso facto determines the social priorities of that society."

More on compulsory savings.


Peter Harris also has reservations.

Compulsory savings.


I don't always agree with Gareth Morgan, but he often makes a lot of sense.

Friday, August 27, 2010

Where are Labour?


We need valid alternatives to neo-liberalism.

Labour opened the door in the first place and some of the culprits are still there. Douglas and co like teenage vandals in a toy shop. They were unable to stop at the necessary reversal of some of Muldoons rorts.
If Labour is just going to fiddle around the edges like the last 9 years then they have really lost their way.

Face some facts. The current system only works for overseas financiers. Productive people are leaving in droves as their pay is reduced. Sticking every one in jail does not cut crime. Inequality is increasing rapidly. The new generation think that antisocial greed and loss of community are normal.

NACT are borrowing for election bribes just like Muldoon. How long before they start rigging election boundaries like them also?
Unless Labour comes up with some sense and courage NACT will have us down the toilet.

Thursday, August 26, 2010

On taxes.


The rich do not pay tax because they can use all sorts of dodges. Tax is generally paid by higher earning wage earners.
GST does catch the tax avoiders in the tax net to some extent. Broadening the tax base.
Some things need to happen for a fairer tax system.
Capital gains tax.
Transaction taxes.
Currency speculation taxes. Needs other countries to implement at the same time to work.
45% on really high incomes. Over $150k.
Get rid of trusts and other dodges.
Except for taxes on high wage earners are all means of broadening the tax base.

For income taxes I would like to see Gareth Morgans idea of a universal individual minimum income administered through IRD replacing benefits. The main advantage is reducing administration costs, but it also removes the need to go and beg to WINZ for a benefit.

Wednesday, August 25, 2010

Industries we could lead in.


Anyway I said I would be positive.

Admit this is one of my pet projects.

I have not managed to find the website again. But a UK firm was looking at designing and manufacturing electric city commuter cars for lease.
Something NZ could be a leader in.
The sort of investment it is worth borrowing for.
Composite construction with the renewable composites Waikato is researching.
Intellectual property for export.
Power from renewable s on the grid is more energy efficient than petrol.
Petrol cars can be kept for long distance travel.
Carbon offsets.
Foreign exchange savings from offsetting hydrocarbon imports.
May help develop renewable energy industry also.
Manufacturer leases so incentive to make the cars long lasting. No planned obsolescence.
Simple design as restricted to 50k/hr.
Leased so drivers do not have to buy another car.
This sort of thing will not happen however without Government leadership.
As NACT have shown with biofuels they would rather we stayed followers.

Sunday, August 22, 2010

Not Quite Steinbeck: WTF is Neoliberalism?

Not Quite Steinbeck: WTF is Neoliberalism?

" Do you want to know why the Wall Street crashed? Because of neoliberalism. Do you want to know why there are so many illegal immigrants in the US? Because of neoliberalism. Do you want to know why you can’t find a job? Because of neoliberalism."

Performance Pay for Teachers.


On the face of it, It seems fair to reward people who perform better than others with more pay.
If anyone can come up with a fair and valid performance measurement. Fine.

However even in the private sector this is fraught with difficulty.
Unless performance has a single clear measurement business has a poor record with targeting performance pay.
Sales may be OK. As you can measure performance by the number of sales. But, what about the back office contribution to sales. The receptionists contribution.
In less easily defined jobs like management, performance pay has failed to deliver better performance.
In fact higher pay to top management and higher performance pay, in British research, correlates with the worst performing companies.
What measure do you use. Return to shareholders. It is easy to maximise return to shareholders short term by sacrificing the long term viability of the company. By then the manager has taken the money and run.
Production. Was it the manager or the staff?
Sales. Was it better training, better support, better product or sales team performance.
While I would be the first to agree that there are some time serving teachers who should not be there. I’ve seen those people in many other professions also.

There are also stars who stand out, however the majority, like most professions, are dedicated, hardworking people who try to do their best for their students. This is constantly made more difficult by power seeking politicians attempting to impose their latest fad.

If performance pay is such a good idea how about tying MP's pay to the average wage. 5 times the median wage with an 85% tax abatement rate on any other income would seem about right.

Saturday, August 21, 2010

On the US vs Germany


"Were You Born on the Wrong Continent? Why You'd Probably Be Healthier and Wealthier in Germany

How Europe makes people's everyday life much more pleasant to live in."

"That's easy: Europe. I can answer that as their lawyer, the way a doctor could answer about their health. The bottom two-thirds of America would be better off in Europe. I mean the people who have not had a raise (an hourly raise in real dollars) in maybe 40 years, and who do not even have a 401(k), nothing but Social Security, and either have no health insurance or pay deductibles of $2,000 or more. Sure, they'd be better off in Europe. When unemployed, they'd certainly be better off in Europe. Over there, even single men can get on welfare. And in much of Europe, contrary to what we hear, unemployment is much lower than over here".

Monday, August 16, 2010

On Kiwisaver being compulsory.


The worry is that Kiwi saver in private finance company hands may become like company super schemes in the 70's and 80's.
The fact that most of them performed miserably, except for enriching fund managers, was hidden by the tax rebates and employer contributions.
The fund management industry will be fizzing at the idea of this windfall.

A sovereign fund investing in NZ infrastructure would help make our kids able to support pensions.
And allow the money to extend Kiwibank to remove the overseas sources of finance from the equation.

 Hell we may even get back control of our country from the banks.

Sunday, August 15, 2010

Solutions. Banking and finance.

I have put in a lot of doom and gloom here, but I do think we have some solutions.

 Dug out my economics textbooks and did a lot of research and discussion.
Nationalising banking is the only solution which people would except. The only one which could be sold as an election policy.

Recent rorts by finance companies and investment firms will help the case. We are being forced at the moment to put Kiwisaver accounts directly into financial firms which are likely to go down with the US share markets final crash. Better to reinvest it in constructive areas for the future of NZ.

We have already seen the effects of Kiwibank on the amount of money the other banks can remove from the system.
Kiwibank actually has the capability to remove the other banks from our system because it can operate like a co-op with no need for profit, the private banks could be removed by making them unable to compete.

Banking is too important to be left to the control of private shareholders whose only motivation is extracting money from us.

There will always be those who extend credit and borrow privately, but credit supplied by the Government is always cheaper and a private credit providers will stay on the fringes. Laws against loan sharks already exist.
The only difference between legal private finance providers and loan shark are a few percentage points.

Those who control the money have the say. It should be the citizens of NZ.

With democratic control of credit restored we can deal with other externalities of credit creation.
A library book or student loan model of credit where constant economic growth is not required to maintain a constant increase in credit supply.

What the worlds richest share trader thinks of class warfare.

In Class Warfare, Guess Which Class Is Winning

“There’s class warfare, all right,” Mr. Buffett said, “but it’s my class, the rich class, that’s making war, and we’re winning.”

Saturday, August 14, 2010

Friday, August 13, 2010

The economy and peak oil.


Food production, energy and even the production of substitutes for oil depend on petroleum.

So does the economic system. It is unlikely it will survive the loss of cheap energy.

"To illustrate, if home and business loans are issued with interest rates in the 7% range, the assumption underlying the loans is that the monetary supply will increase (on average) by 7% per year. But if that 7% yearly increase in the monetary supply is not matched by a 7% yearly increase in the amount of economic activity (goods and services), the result is hyper-inflation. The key is this: in order for there to be an increase in the amount of economic activity taking place, there must be an increase in the amount of net-energy (i.e. the net-number of BTUs) available to fuel those activities. As no alternative source or combination of sources comes even remotely close to the energy density of oil (125,000 BTUs per gallon, the equivalent of 150-500 hours of human labor), a decline or even plateau in the supply of oil carries such overwhelming consequences for the financial system. Dr. Colin Campbell presents an understandable model of this comple  relationship as follows: "

Dire predictions from the USA.
All is not rosy in the land of the neo-libs.



A few Unions abused monopoly power. = ECA.
Fonterra, supermarkets, power companies, ports, banks etc etc form cartels or abuse monopoly power to rip us all off = What??

Wednesday, August 11, 2010

Portugal Makes the Leap to Renewable Energy -

Portugal Makes the Leap to Renewable Energy -


Portugal has made the leap to clean energy without a blowout in Government debt.

Shows initiatives like the Green new deal can work.

Tuesday, August 10, 2010

State welfare.


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

  • Banks and finance companies who fail with Government guarantees.
  • 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.
  • 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.
  • State pays training for employees so employers do not have to pay for it.
  • Banks getting windfall profits when the OCR is raised.
  • Currency speculators who short the NZ dollar.
  • Police protection against people they have disenfranchised.
Yep we really do need to cut welfare.

Sunday, August 8, 2010

More Stupidity from the reserve bank act. Bollard Raises interest rates in case we dare to ask for wages to stay constant in real terms.


Of course raising business interest rates beyond that of overseas competitors has no effect on prices and competitiveness. Right!! And interest rate rises of themselves are not a driver of inflation. Right!! And higher interest rates in NZ do not give windfall profits to overseas banks and finance companies. Right!! And lower wages and higher prices do not drive borrowing to live. Right!!

Saturday, August 7, 2010

On Skilled Wages and student loans


People have short memories. Before the student loan scheme only the children of the rich went to University paid for by the taxes on those who did not. Student loans spread some of the cost. It is easy to get loans repaid. Pay decent wages commensurate with skills and use the same sanctions on defaulters as the private sector.
The real problem is salaries for educated and skilled people have dropped so much since 1984 (40% in my profession) that it is stupid for any young person to stay in New Zealand. Employers have managed to pass their training costs onto tax payers. (Apprentices are now paid a training allowance and many work for nothing) or onto other countries by bleating to the immigration department they cannot get NZ’rs to do the job. Meaning they can’t get us to work for SFA or they have not trained anyone for 30 years. This will dry up as even Indian and Chinese wages for highly skilled people are starting to exceed ours.

On Reducing Crime.


A senior judge suggested some proven effective ways to cut crime and she was silenced. 

I have copied her speech as it is very hard to find. It has been removed from the appropriate websites.

Student Union Complex, Victoria University, Wellington
Wednesday 9 February 2005
Sian Elias*
Criminology in the Age of Talk-back
This conference deals with difficult topics. Identifying the causes of crime and
correcting and preventing criminal behaviour has exercised every society. We
should not be surprised that they continue to vex us.
The level of crime is a source of proper public concern. As such, in a democratic
society, crime is rightly the subject of close political attention. In recent years the
level of anxiety has intensified. How crime can be best prevented and how the
balance is to be struck between punishment of a criminal and effecting safe
reintegration of the offender into society are old questions. But they are of particular
urgency today. They are the subject of heated debate within the wider community
and within the political arena. That is not something we should deprecate. These
are matters of legitimate interest to all in our society.
What the level of public anxiety and political interest means is that there are some
particular challenges for those who work in the field of criminal justice and penal
policy. Popular anxieties are never an easy background for scientific discourse.
There are no simple answers. But that message itself is hardly welcome. Nor is the
public and political debate easily informed in an age where modern mass
communication is geared to simple messages. The images and stories of individual
crimes are readily and graphically communicated to a mass audience. They are
properly shocking. The level of anger and anxiety they generate is not easily
addressed. But if we are not to lurch from one ineffective and increasingly punitive
reaction to another, the debate must be reasonably informed. Not just about the
facts of crime. But also about the principles and practices our law requires and how
criminal justice fits into the wider legal system and its principles.
There is much room for reasonable differences of opinion on the difficult questions
thrown up by criminology. It is necessary for all engaged in the field in one capacity
or another to keep an open but critical mind about developing policies and strategies.
We need to be rigorous in the methodology by which we evaluate strategies and
innovations. Simplistic enthusiasms may work as much damage in the end as
punitive reaction.
We need to be very careful that we do not load more expectations into the criminal
justice system than it can deliver. We must ensure that our institutions are not put
under intolerable strain by the heat of the debate. We need to acknowledge and be
respectful of informed public opinion and accept the obligation to inform the public of
the work we do, so that the debate is based on fact, not fiction. We need to
recognise that all of us are on the same side, even if we have different ideas of how
to make progress and even if we have different functions to perform. All of us want
to see crime reduced and increased safety in our communities.
I feel diffident about addressing a gathering of criminologists, particularly as you
come from a number of disciplines. The experience of a working judge in the
criminal justice system is a narrow one. I talk about aspects of punishment today.
Criminology does of course bear upon other work judges do, particularly at appellate
level where questions of policy in criminal law can arise. Perhaps the insights of
criminology are not taken into account as much as they should be,1 but there is I
think a growing appreciation of the insights to be gained from scientific research into
crime and its causes. Such research tests some of the assumptions and
generalisations we have been too comfortable with in legal reasoning about such
matters as provocation, vulnerable witnesses, victims, policing, gang culture,
remorse, and alcohol and drug abuse.
But the principal way in which our disciplines converge is in the sentencing of
offenders and it is in connection with sentencing that I want to raise a few questions
about criminal justice.
My perspective is skewed by being that of a judge dealing with serious crimes in
which the truly difficult threshold question of imprisonment or community based
sentence is seldom in issue. It is also skewed by the fact that, as a judge of a court
of general jurisdiction, I am concerned with wider values in the justice system than
the ends of punishment in the particular case. That makes me cautious about
strategies which may have real merit in terms of penology but which could
compromise other important values in the legal system.
Therapeutic intervention and incapacitation through secure containment of offenders
have the potential to impact adversely upon human rights. Pilot programmes for
sentencing (such as the current Restorative Justice pilot being undertaken in New
Zealand in selected District Courts) and regional variations in the availability and
quality of community programmes have the potential to cause injustice through
inconsistency in sentencing. Informality in the procedure adopted in Youth Courts as
part of the restorative justice initiative (such as the acceptance of a “no-contest”
indication at Family Group Conferences and greater use of inquisitorial procedures)
has the potential to undermine procedural safeguards developed over many years to
ensure fairness and to prevent wrongful conviction. The central position now
accorded to victims in sentencing, bail, and parole determinations and the
importation of a concept of community distinct from the State both have the potential
to change the face of public justice and to cause inconsistency in sentencing. If
parole eligibility arises at an early stage of the sentence (as it does under the New
Zealand legislation) and requires reconsideration of the factors taken into account at
sentencing, public expectations of “truth” in sentencing may be disappointed and,
* The Rt. Hon. Dame Sian Elias, Chief Justice of New Zealand
1 The High Court of Australia has been criticised for seldom referring to criminology scholarship and
research. Blackshield et al (eds), The Oxford Companion to the High Court of Australia (OUP,
2001), 183.
more importantly, in effect substantial sentencing discretion (in our system a judicial
responsibility) has been transferred from the court to the Parole Board. In addition,
we continue to struggle with the disparate ends of sentencing and the lack of a
coherent theory of punishment to provide guidance to judges and to quell those who
believe the sentencing judge is a “free-wheeling palm tree”, accountable to no one.
I do not suggest that these risks will necessarily eventuate. But we need to take
I want to expand on a couple of these points. First, I want to say something about
my perception of where penology is at the moment, and why I think you should be
optimistic about where it is going.
Optimism, it has to be said, is not exactly the frame of mind one gets from reading
some of the criminology literature.
So, for example, there is a sense of weariness indicated in the 50th anniversary
edition of the Criminal Law Review by such veterans as ATH Smith, Martin Wasik,
and Caroline Ball. Referring to the English experience, the articles deprecate the
highly politicised way in which sentencing issues are now characterised, the “talking
up” of sentences by politicians who portray the public as “insatiably punitive”
(contrary to the research findings of a number of studies)2. They refer to the
“managerialist” takeover of youth justice in the 1980s and resulting inconsistencies in
treatment, inefficiencies, and punitiveness.3 Professor Smith expresses the gloom:
The extent to which the criminal justice process has become a matter of party
political posturing must be (well, it is for me) a matter of regret. The nostrums that
“prison works”, and that it is possible to be “tough on crime, tough on the causes of
crime” are perhaps the best known illustrations of the sloganising with which
politicians from either side of the political divide vie to outdo one another in pursuit of
electoral supremacy. The result has been a cascade of criminal justice and cognate
legislative measures, filling prisons to bursting point, and prompting the editor of
Archbold to plead for mercy.4
The same disenchantment appears in the works of many of those engaged in
rehabilitation and reintegration. Modern research from the 1920s into the causes of
crime identified the multiplicity of factors bearing on criminal behaviour, including the
personal background of the offender and the social conditions in which he
developed. That led to therapeutic interventions and welfare programmes for
rehabilitation. From the 1970s empirical research increasingly seemed to suggest
that optimism about the efficacy of the initiatives adopted in preventing crime had
been misplaced. Through the 1980s in particular the prevailing mood that “nothing
works” resulted in widespread retreat from programmes of rehabilitation and paved
the way for more punitive responses.
2 Martin Wasik “Going Around in Circles? Reflections on Fifty Years of Change in Sentencing”
[2004] Crim LR 42.
3 Caroline Ball “Youth Justice? Half a Century of Responses to Youth Offending” [2004] Crim LR
4 ATH Smith, ‘Criminal Law: The Future’ [2004] Crim LR 183.
In her Hamlyn lectures in 1963, Baroness Wootton advocated treating crime as a
social pathology best addressed by medical and social services, with prevention of
crime the primary policy of sentencing policy. By 1981, she was pessimistic.
Reviewing her earlier lectures then, she expressed sadness that in the intervening
17 years “in spite of all the words that have been spoken and books and papers that
have been written on penal policy, the crime rate has persistently risen … the
prisons are more crowded than ever”.5
…I have to confess that over the years since these lectures were delivered, I have
been increasingly haunted by the image suggested in the concluding paragraph of
my first lecture of the whole penal system as in a sense a gigantic irrelevance –
wholly misconceived as a method of controlling phenomena the origins of which are
inextricably rooted in the structure of our society.6
The conclusion that crime and its causes cannot adequately be addressed through
penal policy alone strikes me as inevitable. David Garland has expressed it best:
…it is only the mainstream processes of socialization (internalized morality and the
sense of duty, the informal inducements and rewards of conformity, the practical and
cultural networks of mutual expectation and interdependence, etc.) which are able to
promote proper conduct on a consistent and regular basis. Punishment, so far as
“control” is concerned, is merely a coercive back-up to these more reliable social
mechanisms, a back-up which is often unable to do anything more than manage
those who slip through these networks of normal control and integration. Punishment
is fated never to “succeed” to any great degree because the conditions which do
most to induce conformity – or to promote crime and deviance – lie outside the
jurisdiction of penal institutions.7
If punishment is rightly to be seen as a backup to more reliable social mechanisms, it
is critical that the strategies for addressing crime are wider than penology can deliver
and that they are directed at reinforcing and building on the mainstream processes of
socialisation. But it does not follow that those who have “slipped through the cracks”
should not be the subject of specific strategies delivered through the criminal justice
Nevertheless, in the last 20 years there has been widespread public and
professional disillusionment about the effectiveness of rehabilitative strategies.
Crime rates rose during the period dramatically. There were calls for increases in
prison sentences and the imposition of minimum sentences. In New Zealand the
average prison muster increased by 99% from 1985 to 1999. Pessimism among
professionals and government policy advisers led to a retreat from rehabilitative
programmes. Law and order became a highly charged political issue. Public
confidence in the criminal justice system declined.
My sense is that the mood has turned a little. There are signs that professional
pessimism about the efficacy of corrections based programmes for rehabilitation may
5 Barbara Wootton, Crime and the criminal law: reflections of a magistrate and social scientist (2nd
ed, 1981), 117-118.
6 Ibid, 119.
7 David Garland, Punishment and Modern Society: a Study in Social Theory (1990) University of
Chicago Press at 288-289.
be waning.8 The huge public cost that results from recidivism means that a punitive
strategy alone towards offenders is demonstrably contrary to the public interest.
That message has I think been understood by decision-makers.
The fact that we cannot expect too much of strategies for dealing with those in the
criminal justice system has not deterred us from seeking better ways. We all have
cause to be grateful to the professionals within our justice sector agencies for their
efforts. In New Zealand, criminologists in both the Ministry of Justice and the
Department of Corrections have carried out important research and been willing to
address new strategies in a way that may not be sufficiently appreciated in the
community. They have informed the choices made in our present system and their
work points to the way forward.
In law reform of sentencing and parole considerable effort has been made to ensure
that a proper response to electorate requirements that serious offending is met with
firm punishment does not require the imprisonment of those for whom a communitybased
sentence will best promote reintegration. Nor does it preclude programmes to
rehabilitate. Effort continues into the causes of crime, in significant studies of the
mental health and other characteristics and history of prison inmates. It would be
wrong not to acknowledge that this work is an outcome of the political will to address
crime. And that political priority is to be welcomed, not deprecated.
Better communication with the public about the efficacy of sentencing options is
clearly necessary however. (It would certainly help the sentencing judge!) There
appears little public consensus that the interests of the offender and society are
reconcilable. At the same time, there is an unwillingness among some to face up to
the cost and risk to society in treating prison and lengthier prison terms as the best
strategy for dealing with crime, in what Garland has called “punitive segregation”.9
Some groups seem to consider that community based sentences are no punishment
and are ineffective compared to prison sentences. The research into the
comparative efficacy of sentences needs to be more widely available. Canadian
research10 demonstrates that rehabilitation is not promoted by prison sentences and
that community sentences are more effective in reducing crime. Long prison
sentences are counterproductive for the eventual security of the public, measured by
recidivism rates. Getting that message across should be a priority.
If we are serious about crime reduction, then it seems to me we have to have a
strategy that goes beyond criminal justice. Such strategy is discussed in the
Department of Corrections 2001 publication About Time.11 It is clear it would require
8 See, for example, Brendan Anstiss, Just How Effective is Correctional Treatment at Reducing Reoffending
(Corrections Department, 2003): (last
accessed 1/3/05).
9 Garland, supra, n.7, 140.
10 Thus, Canadian research based on 300,000 offenders found that imprisonment, compared with
community sentences, did not reduce re-offending after release. Longer prison sentences did not
reduce re-offending and may indeed have increased it. Gendreau et al, The effects of prison
sentences on recidivism (User report: Office of the Solicitor General, Canada, 1999), 24 cited in
About Time: Turning people away from a life of crime and reducing re-offending (Wellington,
Department of Corrections, 2001), 10 (About Time).
11 Ibid.
a wide public commitment and a willingness to reserve imprisonment for serious
crime. In New Zealand, the Sentencing Act 2002 points in that direction, although it
does not rank the policies of sentencing to make things explicit. It is not clear to
what extent a wider strategy than a punitive penal one has widespread acceptance.
What might be entailed in gaining such acceptance is illustrated by the effort in
Finland discussed in About Time to reduce the number of prison inmates.12 Key
factors identified in the considerable success of the strategy were:
· Clear expert understandings of the criminology basis behind the policy
changes, both in government and in the public service
· A political accord, maintained across the 20 year period of the
reduction that it was necessary and that there would be no use of “fear
of crime” as a populist theme
· Sober and reasonable media reports of crime stories
· A strategy both of reducing sentence lengths and reducing the range
of crimes resulting in imprisonment
· The support of the public, which was attributed not only to the political
accord and the news media restraint but to regular public education
pieces about the limited crime reduction gains to be had from
· A range of crime control strategies beyond the core justice sector,
including education, social welfare and youth justice.
In the meantime, judges are left with the criminal justice system. Criminal law is, as
Professor Smith describes it, “…the bluntest of society’s social instruments of
control...”.13 In New Zealand, the Sentencing Act 2002 avoids mandatory and for the
most part, minimum sentences. It is a restrained and sophisticated statute which
identifies the purposes, principles and factors bearing on sentencing, without ranking
them. It creates a presumption in favour of reparation, and is supportive of
community based sentences and restorative justice procedures and outcomes.
Because the principles identified are mandatory considerations and because of the
statutory requirement to give reasons, full explanations of sentences are necessary.
It is early days yet, but some of my colleagues on the Court of Appeal think they can
detect a drop off in sentence appeals as a result of the elaboration of reasons
against the statutory considerations. It is hoped that the more extensive
consideration required will also achieve greater consistency in sentencing.
The purposes of sentencing identified in s7 are familiar considerations. They include
denunciation, deterrence, rehabilitation and reintegration. But they also emphasise
accountability to and reparation for the victim and “the community”. The principles
required to be taken into account under s8 are for the most part similarly familiar,
starting with the culpability of the offender and the seriousness of the offence. The
Court is required to impose “the least restrictive outcome that is appropriate in the
12 M Lappi-Seppala, Regulating the prison population: experience from a long-term policy in Finland,
National Research Institute of Legal Policy Research Communications, Helsinki, 1998, 38 cited in
About Time, supra, n.10, 11-12.
13 Supra, n.4, 192.
circumstances” (with a hierarchy of fine, community-based sentence and
imprisonment), but is directed to impose penalties “near to the maximum” if the
offending is near to the most serious of its type. The Parole Act 2002 provides for
home detention for those serving short-term sentences (2 years and less) who have
been granted leave by the sentencing court to apply and eligibility for parole for
those serving long-term sentences after one-third of the sentence has been served
unless a minimum non-parole period is imposed by the sentencing court. The
paramount consideration in releasing an offender under s7 of the Parole Act is the
safety of the community. Subject to that consideration, offenders must not be held
“any longer than is consistent with the safety of the community”. The rights of
victims and any restorative justice outcome must be taken into account by the Parole
It remains to be seen whether the new system over time results in a reduction of the
prison population. A recent Corrections Department study of high-risk offenders
indicates that approximately 28% of prison inmates have risk scores assessing them
at 70% risk of serious recidivism. In a sample of 150 inmates studied at Waikeria
Prison in 2002 with a mean sentence length of 33 months (with a range from 6
months to 11 years), 48% were in the very high risk group (80% risk of serious
recidivism). It is not clear whether the “safety of the community” permits the Parole
Board to reconsider general deterrence and denunciation.14 If so, as Young and
Trendle point out, the Parole Board will effectively be undertaking a second
sentencing exercise. The length of the period of eligibility for parole may give rise to
difficult decisions and issues of principle. As the Corrections Department study
shows, many of those assessed as being a high risk to the community have been
sentenced for relatively minor offences. It is reasonable to expect that some of those
sentenced for crimes which have outraged the community may be assessed at low
risk of re-offending. Under the legislation they may be released after one-third of the
sentence imposed unless a minimum non-parole period has been imposed. There
are concerns from some about the methodology of assessment of risk and fears that
it discriminates against those of particular race, social background, and mental
health status. It is likely that matters such as these will end up before the courts.
Although understandable that the sentencing legislation does not rank the purposes
of sentencing, it seems that the axis between retribution and rehabilitation remains.
That is likely to be less troubling to the Courts than to legal philosophers. Most
judges15 do not adopt the utilitarian view that the only ethically defensible end of
criminal punishment is crime prevention. The view is regarded as counter-intuitive to
the deep-seated belief that someone who has committed a grave crime should be
punished. Just punishment is considered a proper response to transgression of the
criminal law. And indeed, is considered in itself to have rehabilitative value. The
liberal justification of punishment as retribution accords with the ideas of criminal
responsibility and culpability applied in criminal law. Sentencing has therefore been
traditionally concerned with retribution, deterrence and rehabilitation. These
purposes remain in the legislation. But they are joined by concern for restorative
justice outcomes, reparation to victims and consideration of their wishes, and an
14 Warren Young and Neville Trendle, ‘Developing the Sentencing Framework: The Sentencing Act
and Beyond’ in J Bruce Robertson (ed), Essays on Criminal Law: A Tribute to Professor Gerald
Orchard (Brookers, Wellington, 2004) 50, 68.
15 A distinguished exception is Lord Steyn.
emphasis on community safety which, with the length of the period of eligibility for
parole, may suggest a purpose of incapacitation.
Research cited by Lord Bingham suggests that the effect of incapacitation on
general levels of crime is very small.16 He points out that it presents problems when
the offender does re-enter society (as will almost always be the case), often more
dangerous than before. He suggests that ensuring certainty of punishment and
speed of its delivery may be more critical in deterrence (and therefore the safety of
the public) than the sentence itself.
Both the justification of utility and the justification of retribution in liberal theory are
based on impersonal and impartial administration of punishment. Retribution is
justified in liberal tradition as in itself the rightful response to someone responsible
for a public wrong,17 not to effect a private vengeance. McCormick and Garland
explain the procedures of criminal justice as having been designed “to turn hot
vengeance into cool, impartial justice”.
They aim to interpose rationality, reflection, circumspection, balance and collective
group interests as a break upon the unrestrained expression of individual emotions.18
Some aspects of penal policy are now difficult to reconcile with these attributes.
Some may be thought to fit uncomfortably with basic assumptions of criminal law
and human rights. David Garland has commented that “…the modern Western
division between ‘public justice’ and ‘private right’ is being quietly redrawn...”.19
MacCormick and Garland and Ian Edwards have pointed out difficulties for traditional
approaches in moving the victim of crime to a central position in sentencing. Courts
have been quick to point out that an injured party cannot dictate the sentence to be
imposed and that vengeance is not part of criminal justice.20 But forgiveness or
compensation as part of restorative justice outcomes is even more difficult. Ian
Edwards says of forgiveness:
First, it threatens to upset retributive orthodoxy when introduced into traditional
sentencing processes by compromising principles and proportionality and
consistency….Second, giving weight to forgiveness appears incompatible with
deterrence. It would undermine the potential deterrent effect of the criminal sanction,
either on the individual offender or potential offenders. Third, forgiveness is
incompatible with an incapacitative basis for sentencing, under which an offender is
sentenced on the basis of his dangerousness. Forgiveness provides no insight into
an offender’s potential for offending.21
16 Tom Bingham, “The Sentence of the Court” (delivered to Police Foundation at Merchant Taylor’s
Hall, London on 10 July 1997) in The Business of Judging (OUP, 2000), 304, referring to Tarling,
Analysing offenders: data, models and interpretations (HMSO 1993).
17 See RA Duff Punishment, Communication and Community (OUP, 2001), 7.
18 N McCormick and D Garland “Sovereign States and Vengeful Victims: the problem of the right to
punish” in Ashworth and Wasik (eds) Fundamentals of Sentencing Theory (Clarendon, 1998), 26.
19 Ibid, 12.
20 See Nunn [1996] 2 Criminal Appeal Reports 136; Roche [1999] 2 Criminal Appeal Reports (S)
105. In New Zealand, see R v Kanura (CA 238/93, 9 August 1993), 3.
21 Ian Edwards, “The Place of Victims’ Preferences in the Sentencing of “Their” Offenders” [2002]
Crim LR 689, 697.
I do not think that the problems are insurmountable. It is certainly the case that in
the past victims have felt marginalised in the criminal justice system. The criminal
justice system will adjust. But in achieving the balancing required by the sentencing
policies of the Act, some expectations may be disappointed and appellate and
perhaps further legislative attention seems inevitable.
Similar problems may arise in application of an apparent policy of incapacitation. (I
say apparent because it is not clear to what extent the size of the parole period is to
be attributed to concerns for community safety and to what extent it is prompted by
concerns about cost and/or the belief that release into the community is the best
policy in achieving reintegration except in cases of risk.) The Courts are not wellequipped
to predict future behaviour, particularly when viewed at the time of
sentencing. It is true that the same disadvantage attaches to prospects of
rehabilitation, which have traditionally been considered in the sentencing exercise.
But that did not call for anything like the assessment that will now be expected of the
Parole Board. And arguably, the Court may now have to consider what portion of
the sentence should be ascribed to deterrence and denunciation (and the subject of
a non-parole period) and what is to be ascribed to the preventive detention (unless
the prisoner is assessed by the Parole Board to be no risk).
I do not have answers to these questions. Nor do I know how the community is
properly to be identified, and how it differs from the Crown. Some of the literature on
the fragmentation of the community suggests it is largely a romantic construct which
causes inconsistency in treatment of offenders in practice. The insights you have on
these and the other topics you are to discuss during the course of the conference are
of great practical importance.
I conclude by reiterating the view that criminal justice is part only – and not the most
important part – of an integrated strategy to deal with crime and the safety of our
communities. There are challenges in the current heightened public concern about
crime. In the age of talk-back, it is important to communicate with the public about
what works and what does not. It is important that the views put forward are based
on solid research rather than pious hopes or negative reaction. It is necessary to
keep in mind that strategies to address crime must fit into a wider world view and be
consistent with values which underlie our legal system. But the political will to
achieve lasting change is an important opportunity for those interested in
criminology. As the range of topics you will consider over the course of this
conference suggests, there is much going on and much to share.

Reducing inequality also cuts crime.
Of course if you have a lot of people on the breadline you need tough security forces to protect the well off. What there are left of them.
Increasing penalties does not cut crime, Giving people a reason to feel part of society from a young age does.

Wednesday, August 4, 2010

On Money


When money supply was limited because it was tied to real assets such as land or gold it was beneficial to allow lending beyond the actual amount of gold. as it allowed a larger volume of commercial transactions and access to capital beyond the money supply. This is what allowed tradesmen and businesses to grow, in Europe, in the renaissance, by transferring wealth from the landowners.

The prudential ratio is the proportion of deposits in the bank that a bank is allowed to lend out.
Interest charges for the time value of money. Ie if I need a house or business capital  now it is worth my while to pay the owner of the capital extra to have the use of the money immediately.

Velocity of circulation is also important. How fast money flows around the system. The more transactions it is used for the greater the effective money supply. M3.

Too much money chasing too little production leads to inflation as the real basis for money is labour production. loans are charges on future production.

The next source of money are derivatives. Money not immediately associated with the money supply. Shares, futures, onlent mortgages, financial products such as bonds. (Not all bonds are derivative). Keynes called this money market, the casino.

The idea of floating exchange rates was if a countries exports were valued less than its imports its currency would deflate evening up the values so that there was no currency  deficit.

The neo-liberals cut or removed financial regulation such as prudential ratios. Internationally now, there are effectively none, allowed all sorts of funny money derivative markets, allowed capital flows to be unrestricted, sold everyone o the idea that privatization and the market cured everything and the idea that inflation is a great evil. (Because it transfers wealth from the owners of capital to younger working people).

In NZ.
The reserve bank act was bought in to cut inflation. Resulting in an overvalued currency and international deficits as the casino gambled with NZ money. Whenever our exporters showed signs of recovery they were clobbered again and again by excessive interest rates. Manufacturing in nZ almost disappeared as a result.

Banks and overseas investers took windfall profits out of the country from the high rates. gambling with our currency meant that it was way over the value it should have been resulting in borrowing to cover export deficits. Removal of jobs, businesses and manufacturing from NZ increased our reliance on imports.
Prudential ratios were removed from the reserve banks control and they were given the narrow focus of fighting inflation with only the OCR as a tool.

With free flows of capital, asset strippers moved in and bought companies that were earning adequate incomes. Took all the capital out and reinvested it in the casino because they could make 20% or more profit by gambling.
De regulation of finance companies allowed the crooks to move in with obvious results.

In the states the share market money value went up 40 times while in the same period the underlying productivity of the companies went down. The US now owes so much that the future productivity of the States can never catch up with the compounding interest on their borrowings. Federal debt alone is now $13 trillion. $42000 per American.
It must be every bankers nightmare at the moment that debtors just say to hell with it and refuse to pay. Especially indebted countries.

A replacement financial system still has to account for the time value of money, allow some form of borrowing for things such as starting businesses, (You cannot have no cost to borrowing) allow supply for transactions, moderate between exports and imports and allow sufficient velocity of transactions for people to live.
We also say it has to be steady state. (Sustainable) . Ie a business person  who is satisfied with the boat, beamer and bach should not be forced by their finance sources to choose between continual expansion and asset stripping or bankruptcy.

 To those who argue against a Government producing fiat currency. What about the money market in the US where the price of shares rose 40 times and the price of derivatives many times that while the underlying productivity of the companies traded dropped. If that is not producing money out of nothing, what is!  Before we even begin to talk about bailing out failed banks.