The myth of "Retirement Savings"

Kia-ora


Advocates of Kiwisaver and other funded retirement savings schemes perpetuate the fundamental misunderstanding that "conventional" in New Zealand's case "neo-liberal" economists, speculators, finance companies, politicians and those with a lot of share holding wealth in non-productive enterprises like to perpetuate.

In other words all those who gain from wealth transfer from workers to non-productive wealthy parasites.

The myth is that, if we give our wealth to any of the above they will magically increase it due to the "miracle" of compounding interest from investment. Then give it back to us with extra when we retire.
US retirees are already finding out how that works.
The wealthy are keeping the retirement funds. Thanks very much!

"Saving" for retirement relies on three assumptions.

One. That an ever increasing amount of money equals a similar supply of real wealth and real capital.
Two. That an exponentially increasing wealth per person is possible in a finite world reaching resource limits.
Three. That putting money into increasing land prices and increasing derivative prices in the USA, a failing State, will somehow, "magically" mean more money (Healthcare, food, Housing etc) to support you or me in our retirement.

Retirement income, real income as opposed to monetary income, as does schooling healthcare, infrastructure supply and food, always comes from current production. If I do not eat my dinner today, it does not mean there is someone who can give me my dinner in my eighties.

If however, I ensure our young people have enough to eat, good health, training in skilled jobs, functioning and effective infrastructure and good jobs, or if these are not available, at least enough to live on, then New Zealand will be prosperous enough to support me in my old age.

The best investment for my old age then, is not giving my money away for financial wizards to lose, but to pay taxes to make sure that the next generation are happy, healthy, educated, employed and comfortable.

Also published in "The Standard".

Universal Basic Income. UBI.

Kia-ora


The concept of UBI has a long history in New Zealand.

Of course, we already have a UBI for those over 65.  Which has been extremely successful at eliminating poverty amongst the elderly, at a very moderate cost by international standards.

“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”. http://kjt-kt.blogspot.co.nz/2011/06/on-retirement-pensions-and-age-of.html

It has been a policy plank of various minor political parties, such as Social Credit. http://en.wikipedia.org/wiki/New_Zealand_Democratic_Party_for_Social_Credit

Currently, the Greens have discussed a UBI as part of welfare and economic policy development.
 
Many organisations, and individuals both left and right wing, have discussed  the idea. Including the darling of the extreme right, Roger Douglas.

Recently Gareth Morgan has been an advocate. He puts the case rather well. http://www.bigkahuna.org.nz/universal-basic-income.aspx
“Paying universal transfers acknowledges that every individual has the same unconditional right – to a basic income sufficient for them to live in dignity. The Unconditional Basic Income (UBI) provides this.
With this basic protection in place people are then free to add to that income through paid work if they choose. Equally, they can live on the UBI and pursue other activities – doing the unpaid work of caring for children or others in their community for example, or studying full time, or pursuing new business ventures. The UBI offers the prospect of ensuring everyone has the means to live while giving them the freedom to live their lives as they choose.”  

However David Preston from the MSD exemplifies what seems to be the main concern and almost the only real objection to a UBI.  People may chose to go surfing instead of working. Horrors! http://www.msd.govt.nz/about-msd-and-our-work/publications-resources/journals-and-magazines/social-policy-journal/spj10/universal-basic-income-cure-or-disease.html
The vision, of 80 year old pensioners surfing, this engenders,  caused me a great deal of mirth.






In fact the only real experiment with a universal basic income.  http://en.wikipedia.org/wiki/Mincome ,showed that the overwhelming majority, even with guaranteed income, chose to do something constructive.  Work, study or raising children. In the 70′s in New Zealand, with a much more generous unemployment benefit than we have now, almost everyone still chose to work.




The biggest advantage of a UBI, of course, is the almost total elimination of poverty, with all the savings in the accompanying economic and social costs. There is also the not inconsiderable savings in administration of welfare, simplified tax systems and the hit or miss nature of targeted welfare. Because it is universal, there is less incentive for the wealthy to try and destroy it, to cut taxes.

The main objection, apart from the horror of some people that recipients may simply go surfing, A horror they do not seem to extend to the inheritors of unearned extreme wealth, is cost!

It is not, however, a given, that the overall cost of a UBI would be more than that of a fair targeted welfare system.
Of course those same people  throw up their hands object to the cost of current welfare. They cannot understand why the poor are not made to live in cardboard boxes and starve quietly as they do in their ideal economies, just so those on high incomes can pay a few dollars less taxes.

Universal superannuation in New Zealand has been considerably cheaper and more effective than targeted schemes elsewhere.
Don’t see why a UBI should not pay for itself in the savings in administration, the decreased costs of poverty and the extra tax take from extra income within the economy. Flat taxes over the UBI rate, are possible, which should cheer up the right wing.
The removal of abatement rates for working and the removal of the penalty of extreme poverty for business failure, for those not already millionaires, can only help more people into work, study and entrepreneurship. For others, it frees them up for socially useful unpaid work, such as sport coaching, teaching and the myriads of other unpaid and unrecognized work which makes for a functional society.

Lastly. In an era where resources are running out, being able to survive without having to find ever more creative ways of using up resources, and ripping off your fellow citizens, is an essential step towards a steady state sustainable society.

Also published in  The Standard

The magical world of New Zealand's, Neo-Liberal, right wing.

Kia-ora

 The magical world of New Zealand's,  Neo-Liberal right wing.

It has been obvious that some people live in a different world than the rest of us. 

One where Chicago school economics, work!
One where you save the village by blowing it up! 
One where global warming can be stopped, Canute like, by legislation. 
One where dropping wages and giving everything to bloated financiers, makes us better off!
One where removing money from an economy makes it work better.
One where every country is going to get rich by out exporting every other country.
One where enabling greater inequality than the dark ages, works!
 

 The one with the trickle down fairy. "Give us the money and we will p-- on you".

The market fairy. "Leave it to the market and we will cut your wages,impoverish your children, and tell you it is a brighter future".

The Austerity fairy. "We will become better off by becoming poorer".

The catching up with Australia fairy. "We will catch up with Australia by doing almost the opposite of everything they have done".

The Democracy fairy. "We will let you vote, to change the names in Government, or on a few social issues which do not affect our making money off you, but not to make any meaningful changes to the way the country is run".


The privatisation fairy. "We will ensure that the NZ current account is forever in deficit, by selling all the income earning assets"

The debt fairy. "We will cut debt by borrowing $300mill a week, to pay for unaffordable tax cuts, to pay for our Hawaii holidays".

The Job fairy. " We will increase the number of jobs by putting thousands out of work, and cutting the unemployment benefit".

The "We support business" fairy. While ensuring New Zealanders have no money to buy from local businesses, and increasing small businesses costs.

The better future fairy. "We will give you a better future by paying you less, charging you more and cutting services".

It is pretty obvious which side of the political spectrum is on another planet. Planet Key! 
(New Zealand's,  financial industry shill, Prime Minister).

The Reserve Bank, Debt and the Property Market

Kia-ora

In New Zealand we have the "Reserve Bank Act".

Which basically requires the reserve bank to kill the rest of the economy, whenever Auckland house prices, or wages, rise.

Originally enacted, as a circuit breaker, to cap excessive inflation in the 80's, politicians have kept it, long past its use by date, because in their limited view, what works once, briefly, will work perpetually.
It could be argued that it was somewhat successful in curbing very high inflation, on that limited occasion, though others would note that the end of very high inflation ended with the slowing of the rise in oil prices.

Now, every time the New Zealand productive economy struggles off its knees, the reserve bank delivers another knockout.


Howdaft.  Puts it so much better than I can.  I have republished his article here.

I have highlighted some in bold.

"The issues of house price rises in Auckland and Christchurch is prompting comment that it may be time for the Governor of the Reserve Bank to raise interest rates.   It is noted in the media that an increase in interest rates will result in foreign money seeking higher returns to enter the domestic market and this will also increase the value of the already overvalued dollar. 

What hasn’t been commented on is that an increase in interest rates will also penalise every business and household in the country including everyone resident in Auckland and Christchurch who already have a mortgage and have no intention of buying or selling a home.  There will be no beneficial behaviour change within that wide group who are not seeking to get further into debt but it will impose hardship and constrain the rest of the economy.  The interest rate rise would be imposed simply as an attempt to limit price rises in response to artificial shortages of housing in two localised parts of the property market. 

The more sensible action would be to address the cause of these shortages rather than attempt to alter the market response by raising interest rates.

The Reserve Bank Act is not only completely ineffectual at slowing property prices it is the root cause of property price inflation.  Because the Reserve Bank Act obliges debtors to pay over the market price for debt, it also guarantees lenders greater than normal market returns on investments.  The result is that foreign cash looking for high and secure returns has flooded into the New Zealand property market.  The banks are incentivised to actively inflate the property market because of the high returns it provides (thanks to the Reserve Bank Act) and because of the flood of money that they have to invest.  As a result the more the Reserve Bank increases interests rates above the natural rate for the marketplace the more money that flows into the property market, the less risk averse lenders need to be because they receive higher margins on loans and this results in banks adopting laxer lending practices, this then leads to property price inflation which results in the rate of increase in capital value of the property (in the overheated parts of the market) to exceed the cost of debt - for a while at least – the negative real rate of interest in this small part of the property market consequently further incentivises borrowing.

The end result is that we are as a nation carrying far more debt than is necessary for the economy to function effectively, we have a ruinously over valued property market, we have a grossly overvalued exchange rate, we are bleeding our scarce foreign earnings on interest payments on all the debt and meanwhile our productive sector is crippled by both the cost of borrowing and by the over-valued and highly unstable exchange rate, Instead of suppressing inflation, the Reserve Bank act causes inflation.

The Reserve Bank Act is singularly the most stupid element of the reforms of the 1980’s.  It is utterly illogical in that it defies the simplest of precepts of economics.  The answer to the problem of inflation is simple.  If a government wishes to increase the cost to the consumer of any element of the economy without increasing the supply of that element it imposes a tax not a compulsory price increase – alcohol and tobacco are excellent examples of this concept in action.   The government also targets only those activities it wants to constrain.  So when it taxes alcohol it does that based on alcohol content – it doesn’t tax all liquids.

A tax also allows for redistribution and targeting by the government to occur so if the tax imposes on lower income households this can be resolved through social payments with the tax on debt as a source of funds.  Similarly the tax can be linked to the asset class or region causing the problem so there may be a lower tax on business debt.  This is not difficult; the banks already set interest rates by the manner in which the debt is secured, the tax could be similarly targeted.   This is only one possible mechanism as there are is a range of possible taxation responses to this problem which these need to be linked into a wider strategic review of the role of taxation in the economy.

At a more fundamental level any market failure or physical circumstances causing the price pressure also needs to be addressed.  Auckland prices are being driven by a range of other policy actions by government that put inflationary pressure into the market.  These include allowing uncontrolled foreign ownership of residential real estate, immigration – from both within New Zealand and from off-shore - and from a failure to fully price the true cost to the national economy of growth of the major cities and the cost of internal migration of business and residents.  Property in the larger cities but particularly in Auckland is being subsidised in a number of ways while the rest of the national market is in one form or another languishing with surplus housing and infrastructure.  In addition to fostering policy that actively inflates the cost of housing nationally and causes our international debt to be excessive and our currency to be over-valued we are not as a nation using our existing investment in infrastructure wisely. 

We need to be asking ourselves collectively why we, who as a nation have the highest natural capital per capita and arguably the best system of society in the world, are one of its debt basket cases.  We are only being prevented from being another Greece or Cyprus by the dairy industry.  We also need to ask why we are not so much better off as a nation when countries like China and Singapore are doing so much with so comparatively little.  The answer is quite simple and that comes down to the vision and courage of their political leadership, could I commend you to read George Monbiot’s recent post

http://www.monbiot.com/2013/04/22/the-self-hating-state/ as it very accurately describes the malaise that we have inflicted upon ourselves with our reforms and our reliance on “The Market”  to provide."

The Standard on Pay Rates.

Kia-ora

The New Zealand left wing newsletter/blog, "The Standard" has some interesting discussions on wage levels.

It appears only the already rich work harder when they are paid more. The poor have to work for love.

The idea that we are not competitive unless wages are low wears a bit thin when those at the very top can pay themselves 17 to 20% more each year.

 Zetetic in The Standard on pay rates.

"As you know, the Right says more money incentivises harder work. John Key felt he wasn’t working very hard when he first became PM on a net $250,000 a year, so he gave himself tax cuts and pay rises worth $100 a day. Just look at the results!
But I’m confused: why’s he cutting our pay with youth wages, higher Kiwisaver, and higher student loan repayments? Is it that rich people work harder when they get more money and poor people work harder when they get less?
I guess the elite really do see us as a different species – mules, I suppose. And I see them as a different species but for different reasons and as a different species – leeches.

Living wages.

Kia-ora

One of the "grass roots" initiatives that has arisen partly out of the occupy movement is The living wage movement. Living Wage

Predictably those who award themselves 100k bonuses and 17% pay rises, while dodging taxes are opposed.

Zetetic on a living wage.

"Don’t you love hearing the rich say the working poor can’t have more pay? The faux concern that higher wages cost jobs from the same people who support huge executive pay packets and tax cuts? If you really believed higher wages meant fewer jobs, you would cut the CEO’s pay in half, not dick around over a few dollars an hour for real workers. (Emphasis mine).

Of course, the truth is more money in working people’s hands means more demand for the basics, meaning more jobs. It’s well-established empirical fact. Anyone who argues otherwise is just using a false justification that masks their real – much less altruistic reasons – for wanting the poor to stay poor.""

 How, if low wages are good for the economy, do the  wealthiest justify awarding themselves higher pay while the rest of us have pay cuts.?
 We have a shortage of skilled technicians and trades in New Zealand. How is it econmically justified that their pay has been cut year by year, while financial finaglers, directors and "managers' where there is no shortage continually award themselves more pay? Japan and Germany seem to find competent managers, with pay differentials much less than ours.
How do managers, bankers or politicians, and other non-producing parasites, sleep at night when they collect 100's of thousands a year and put a miserly $13.50 an hour into their hard workers pay packets.

 At the same time, in New Zealand, half of our wealtheist people pay little or no tax. Wealthy dodge tax
One of the main reasons the PIG's went under is the lack of tax take from the wealthy. In Greece dodging taxes was a national sport. In New Zealand we just make the wealthy avoiding paying for the social and natural capital they use, legal.

Livable income.

Kia-ora

A liveable income should be a human right.

We accept that someone can inherit unearned millions, but we do not accept that someone else should inherit enough, from our society, to live on, as of right.

Who actually has the culture of unearned entitlement?
The Koch’s, Romney’s, Bennets, Shipley and Keys getting thousands a day for contributing very little.
Not a teenager who has been struggling unsuccessfully to find work for two years and is expected to live on $130 a week.

The days of constant growth and full employment are gone.

We can produce enough for everyone to live in comfort in NZ with fraction of our present activity/employment.

I do not have the figures for New Zealand, but, rather than a more equal distribution of income making everyone poorer, if the USA’s current production was shared equally, every family in the States would have an income of around 180k annually.

The right wing idea that a more equal distribution of income means equality in misery, is an obvious fallacy.

A surgeon, teacher or entrepreneur should earn more than an unqualified cleaner, but by cutting extreme wealth there is plenty of room to eradicate poverty in New Zealand. Or the US.

No one except for some rare exceptional entrepreneurs, “earns” millions.

Note that in both the USA and New Zealand when they were at their most prosperous the top progressive tax rate was much higher and inequalities in wealth much lower than they are now.
Trickle down does not work.  http://kjt-kt.blogspot.co.nz/2012/08/blog-post.html

The "Culture of Entitlement".

Kia-ora

Welfare recipients “Culture of Entitlement”.

Unintentional irony from individuals who are sitting on 100 thousand dollar pay rises, while their company tanks in the recession, salt their income away offshore to avoid taxes, prefer to spend on bidding up prices with unproductive speculation, expect taxpayer bailouts when their gambling fails, and ask for tax cuts while the deficit increases.

The Poor don't ask for much, but apparently it is too much!.

Kia-ora

"I hate the sense of entitlement some people have - thinking they should have food, shelter, clothing etc. How dare they."

The poor do not ask for much.

The rich think they are entitled to millions, usually just because their parents had it, or they succeeded in gaming the system (stealing) it.


Like these, Corporate Thieves or these, Stealing the commons. or these, Bankers pay them selves highly while they destroy real wealth. or these. How Wall Street made Money by starving millions.

Is it too much to ask that everyone is entitled to a share in the prosperous societies, and plenty built on their ancestors and their own efforts. Not just the rich!

A living income.

Welfare/Social Insurance, Myths Busted.

Kia-ora

Welfare Myth Busting.

 And a right wing job busting Government was elected.

More on welfare myths here. Ten Myths About Welfare/

Far from being bludgers, most social welfare recipients are receiving the social insurance they paid taxes for during the remainder of their working lives.

The few that are not are almost all people who have physical or mental disabilities, which prevent them from working. A decent society should be looking after them anyway.

A Challenge.

Kia-ora

 
A challenge
“And, out of interest, does anyone know of any research into privatization that shows it to be generally effective at improving a service, increasing efficiency and leaving its lowest level workers with a living wage? All I read currently is that the investors get richer, the management can pay itself what it likes, the customers pay more and more for worse service and the lowest level workers are told they need to find a second job just to survive because they are a valueless kind of replaceable resource.”


I have not found a single case where this can be answered in favour of privatisation. Can You?

The "Wealth Creator" myth. Stealing the commons. Part two.

Kia-ora 

One of the memes the wealthy and their sycophants prefer to repeat is that, "the wealthy create wealth".

Lies the Rich Perpetuate.

That is demonstrably wrong.

"The wealthy got their wealth by entrepreneurship and starting new business" ?.
Well! no. Most are wealthy because they are born with it. The majority of the rest because they gamed our system to make money from existing assets and public utilities. Morally, no different from robbing someones house.

How Allan Gibb's made a Mint out of a Former Public Utility.
""Gibbs spotted his opportunity early in 1990 when he did his hallmark one-page analysis of what Telecom might be worth. "It was a lovely, fat company, with huge margins and a lazy balance sheet. It was obvious if you could keep the margins it would be a fantastic business." Like an alpha predator, he went for the throat"".

"The wealthy  became wealthy through start-ups and entrepreneurship. Selling people products they want".?

Less than 1% of the wealth held by wealthy households in the USA is invested as so called "angel capital". In reality the wealthy avoid risky start-ups, like the plague. They prefer privatizations of State utilities and financial products where there return is assured by tax payer funding. Those that are too big or too essential for the State to allow them to fail.
Affluent Survey.

In New Zealand many people bought into the myth that "if they wealthy were allowed to keep more of their wealth they would invest more in the productive economy and we would all be better off".
New Zealand went so far and fast with this Neo-liberal piece of B-s that, like Ireland, we were held out as a poster child for other countries.

The infamous "trickle down effect".

After 35 years of tax cuts for the wealthy, asset sales, anti-union legislation, deregulation of banking/finance and wage and welfare cuts.

We have;
 Huge capital losses to offshore bankers and profit takers.
Growth well behind the OECD average.
Increasing child poverty.
Steeply rising prices. Especially for privatised utilities.
Median wages are dropping while the wealthy get 17% annual increases.
Billion dollar bailouts for financiers.
Millions of dollars to reinstate previously privatised essential infrastructure.

Anyone who still believes that giving the already wealthy more of our wealth is the answer is either seriously deluded, or venal.

Agenda for today.

Kia-ora

NZ has a whole generation of managers, cannot call them leaders, who have no vision apart from cutting staff, costs and services.

It was an accountant who told me once, "do not put an accountant in charge, they know the cost of everything, and the value of nothing".

Then they act surprised when their skilled staff head for Australia, their customers head elsewhere and their business tanks.

The same logic has now been applied to the whole country.

Poverty in New Zealand.

Kia-ora

One of the biggest indictments of our current economic dogma is the number of people, in the worlds richest nations, living in poverty.

What comes first is POVERTY.

Poverty is what makes “breeding” for a living seem like a good option.
Poverty is what causes all the poor outcomes to the children of teenage mums.
Poverty is what causes people to be caught in a trap of continuing poverty.

We are never going to solve problems caused by poverty by making people poorer.

Social security and minimum wages that are so low, there is almost no chance of climbing out of the poverty trap, causes  the problems.

Abatement rates for those earning a bit of money while on social security are higher than those for millionaires.
A two tier education system is going to make escape from poverty even harder.

Low wages are not even good capitalism. “Businesses that cannot meet the costs of the resources they use should be allowed to fail, so others can make better use of the resources/labour”.
Every business paying low wages means there is little demand. Hurting all business.
“You should pay your workers fairly because they are the source of your wealth” Adam Smith.

Three decades of Neo-Liberal meanness is coming back to bite us. And the right want to make the victims lives harder.

A guaranteed minimum income, national super, has succeeded in practically eliminating poverty in the over 65′s. Less than 3% live in poverty, and that most likely is self inflicted.

If we are serious in eliminating poverty amongst children, 20% living in poverty, we would extend the GMI idea, that has been so successful with the elderly, to young people.

What is Neo-Liberalism?

Kia-ora

What is Neo-Liberalism.

Neo-Liberalism is a moral and intellectual justification for greed.

A way for those few who accumulate wealth, by impoverishing many, to justify themselves, and keep those they are stealing from docile and compliant.

This purpose for centuries has been fulfilled by religion.

We still see echo's of the religious  attitudes. The idea that the poor are poor because of personal defects,  American exceptionalism, the banker who reckons, "God wanted me to be rich",  Ayn Rands "wealth creators".

Neo-liberals outwardly believe in small Government, minimal regulation, taxation and social security,  individual freedom and responsibility and the primacy of the market in fostering economic efficiency.

In fact their leaders and intellectuals believe in anything which enables them to accumulate wealth at the expense of the rest of us.

Neo-Liberalism would be more appropriately called Neo-conservatism. It is an attempt to return to pre-enlightenment times when the idea of "each is born into their proper place" was undisputed.

Neo-Liberalism has become common usage, unfortunately we are stuck with it.

Neo-Liberalism itself has all the characteristics of blind belief and faith inherent in religion.

Despite its only success being in making a very few people wealthier, millions of people, including most politicians, blindly adhere to the faith. 

http://nzagainstthecurrent.blogspot.co.nz/2011/03/junk-science-voodoo-economics.html

'It doesn't seem to matter that they NEVER get it right. It doesn't seem to matter they are promoting economic theories that are junk. But unlike Ring's quackery, the quackery of neoliberalism is treated with reverence, it is ascribed legitimacy'. 

 "The first of these shifts was the Great Depression or, more precisely, the feckless response of both American mainstream political parties to the economic collapse that followed the 1929 stock market crash. In the crucial first years after the crash, Democrats and Republicans alike embraced exactly the same policies they are embracing in today’s economic troubles, with exactly the same lack of success, and showed exactly the same unwillingness to abandon failed policies in the face of economic disaster. Then as now, the federal government launched a program to bail out big banks and corporations—it was called the Reconstruction Finance Corporation in those days—and pumped dizzying amounts of money into the upper end of the economy in the belief, real or feigned, that the money would work its way down the pyramid, which of course it didn’t do. Then as now, politicians used the shibboleth of a balanced budget to demand austerity for everybody but the rich, and cut exactly those programs which could have helped families caught by hard times. Then as now, things got worse while the media insisted that they were getting better, and the mounting evidence that policies weren’t working was treated as proof that the same policies had to be pursued even more forcefully." (John Micheal Greer).

Their Apostles are Adam Smith,  Ayn Rand, Von Mises,  the Austrian, and Freidman, the Chicago,  schools of economics.

Adam Smith's "invisible hand" is often quoted. Adam Smith's "you should pay your workers fairly because they are the source of your wealth" and "tax capital and land instead of workers and entrepreneurs" is, of course, ignored.

Von Mises and Freidman advocate a totally unregulated market and a Government as one adherent famously said, "that you could drown in a bathtub". Except for police and military to protect their wealth, of course! http://en.wikipedia.org/wiki/Grover_Norquist

Ayn Rand considered the owners of capital "wealth creators" although she had to live off the real wealth creators, the rest of us, towards the end of her life.

http://www.alternet.org/story/154153/how_the_1_destroys_jobs_and_the_real_heroes_are_everyday_people

"So before we consider having another trickle-downer in the White House, let’s talk about the failure of this idea and why if you want to see a real job creator, you should look in the mirror".

In fact they support their own freedom to make money regardless of social, environmental or economic effects. At the same time restricting individual freedom to protest, or co-operate to challenge their primacy.

Supporters do not seem to see the conflict between saying they support  individual freedom  while at the same time restricting the majorities individual freedom to withdraw their labour or protest. These freedoms are restricted, often violently.

http://bowalleyroad.blogspot.co.nz/2012/04/protecting-winning-ticket.html

"Let’s recap. You’re rich, and you want to stay that way. So, to protect your ticket; to safeguard your $50 million prize; you need to find a way to eliminate, or at least minimise, the threats posed by taxes, unions, and democracy. What’s your strategy?

Essentially, there’s only one winning strategy. It requires you to convince all those who are not wealthy that whatever status and security they do enjoy is the result of your own superior imagination, risk-taking and skill. You have to paint yourself and your fellow millionaires and billionaires as a “wealth creators” and, more importantly, “job creators”. You have to convince your fellow citizens that any attempt to restrict or redistribute your wealth will not only put their jobs at risk, but that society as a whole will become poorer.

If you can convince people of these things, then they will, perfectly democratically, eliminate wealth taxes, truncate workers’ rights, and reconfigure their entire political system to favour the tiny minority fortunate enough to hold the multi-million-dollar winning tickets"

Neo-Liberalism. Like all religions, is a way for the already wealthy to delude everyone else from rebelling, so they can keep their "winning ticket".

While many followers of religions have the best of intentions, their leaders have no such illusions. The intent is to keep wealth and/or power.

The overall effect of Neo-Liberal economics is to "privatise profits while socialising the losses".

Hugely increasing inequality and economic and social dysfunction.

Country after country adopts Neo-Liberal economics and rapidly goes downhill even by Neo-Liberalism's own measures such as GDP. And we still believe it is the solution!

Compare Argentina and the BRIC countries to the Anglo Saxon countries that are slavishly following the Neo-Liberal religion.

http://krugman.blogs.nytimes.com/2011/06/23/dont-cry-for-argentina/

Truly voodoo economics.

Good and bad Dictators.

Kia-ora

This Dictator of an oil rich country.

Overthrew a democratically elected Government.
Murdered between 700 thousand and a million of his own citizens to get into power.
Brutally squashed two independence movements. Now engaged in squashing a third.
Keeps about 2/3 of his country in poverty.
Allows foreign companies to repatriate almost 100% of their profits. Especially Western oil companies.
Has the worst environmental record in the Pacific..
Allows abuse of workers in virtual slave labour.
Sends troops in to kill unionists.
Country has unsustainable debt.
Streets of beggars and homeless.


This Dictator of an oil rich country.

Left his country with no external debt.
Gave interest free loans to citizens.
Had Western standards of living.
Increased literacy from 25% to 83%.
Had the Highest Standard of living in Africa.
A proportion of all oil sales was credited to every citizens bank account.
No beggars in the streets and no homeless.


Guess which one was helped into place by the US Government and is supported by other Western Governments, including ours.

Guess which one is considered so bad that we should support his overthrow.

The Rena. A Neo-Liberal failure.

Kia-ora

Nearly two weeks ago now a container vessel grounded on Astrolobe  reef near Tauranga, New Zealand.

Shipping accidents like the Rena are entirely at the door of Neo-Liberal economics.

The foreseeable results   of Globalisation, de-regulation, the endless search for the cheapest, the socialisation of risks and the privatisation of benefits..

Tired, overstressed, low paid  crews,  cheaply built and maintained ships, inadequate or ignored regulation and excessive workloads are the norm at sea.

Flags of convenience exist entirely so that shipping companies, and shippers, can reduce the costs: of corporate and income taxes, safety  standards, operating standards, crew conditions and wages and build standards of shipping.

They allow a competitive race to the bottom to see who can become the cheapest.

There is no reason whatsoever to use a flag of convenience if you intend to operate a vessel to a high standard. There would not be any cost savings.

The constant struggle to maintain cheaply built ships, designed and built for a 15 year life. Is bad enough when they are new.  5 or 10 years  beyound their design life , keeping them going is a 24 hour a day job.

Low wages, mean that high quality well trained crew find other work ashore or in higher paid work like the oil industry.

Masters and Chief engineers are often the only properly trained and skilled members of the crew, with the numbers made up of cheap labour with dodgy qualifications.

It is common for crew to be on board working shifts with less tha 8 hours off a day for more than 9 months.

Training standards are variable, with a noticeable drop in the standard of training, even from first world countries.  At the same time crew numbers have been dropped so there are not the personnel available to babysit and train.

Seafarers are expected to rest in ships with levels of noise and vibration that would have been totally unacceptable thirty years ago.  Ashore in NZ it is illegal to get people to work, let alone sleep, in those conditions

In New Zealand, Masters who refuse to sail because of broken equipment or rough weather and crew members who refuse to falsify rest hour,  maintenance, safety  and leave records are protected by our employment laws.

A sacking for those reasons, in New Zealand,  would be a legitimate case for unjustified dismissal..

 On FOC ships  they are sacked or their contracts are simply not renewed.

The worst of it, since the 1980's and Governments cave in to the farming lobby on Cabotage, in NZ, even local shipping companies, whatever their intentions , are also cutting standards to compete with cheap overseas shipping.

Kia-ora

A reminder of why we have to change our economic paradigm.

Our present one is not sustainable, even short term.


“Memo To The #Occupied Movement (A Post-Growth Economy)
By Richard Heinberg
06 October, 2011
Post Carbon Institute
Here’s a fact that’s hard for most Americans to swallow: economic growth is over. Given the finite nature of our planet and its resources, the recent trend of global economic expansion was destined to end. No stimulus package or slashing of social programs is going to flip the economy back to an expansionary trajectory. We’ve hit the proverbial wall, and this will be the defining reality of our lives from now on.
The growth-seeking political-economic system has failed us. Today that system is dominated by Wall Street. “Goldman Sachs rules the world,” trader Alessio Rastani told us in a now-viral BBC interview. I met people like Rastani in researching my book, The End of Growth.
At one lavish conference, 800 global investors packed a hotel ballroom to consider climate change. There was no talk of how to avert or mitigate floods and droughts. Instead, the discussion focused on profiting from warming with — no joke — weather derivatives. These folks were just doing their job, despite any private feelings of concern, remorse, or dread. And each was getting paid enough to single-handedly fund a midsize school district.
Both Wall Street and Washington are trying to do something impossible: grow human consumption forever in a world of limited energy, minerals, water, topsoil, and biodiversity, all while protecting and expanding the riches of the top one percent. If economic growth is over, that means we can no longer count on a rising tide to lift all boats. Under these conditions, extreme income inequality is not just unfair, it is socially unsustainable.
It’s strategic to bring protest to Wall Street rather than Washington. We must go directly to the crime scene — not with a request for reforms, but with an arrest warrant from the people.
You courageous people in the #occupy movement are absolutely right in saying the system is broken, greedy, and unfair. But when our discussion turns to replacing the current system, we’ve got to embrace a bigger view of reality than the one held by stock traders and politicians. It’s not just our wealth they want to control, it’s our vision for what is both possible and necessary. We need a post-growth economy that works both for people (all of them) and for the rest of nature: a localized economy based on renewable resources harvested at nature’s rates of replenishment, not a fossil-fueled global economy driven by the imperative of ever-higher returns on investment."""

New Zealands credit downgrade. Or the Story of more Neo-Liberal economic "successes".

Kia-ora

It would be funny if it was not so serious.

NACT (New Zealand,s,  Right wing, Neo-Liberal Government) cannot even meet performance targets from, the totally discredited, "credit rating" agencies.
Agencies which are on the side of the same economic dogma as NACT.

This could have been avoided simply by legislating that no private finance companies would be bailed out.

The New Zealand Government, like, the other failing States, Ireland, UK, Greece and the US etc, has made it obvious that private finance debt is a taxpayer liability.

Look to Argentina and Iceland to see the benefits of telling the banks to get stuffed. Argentina, one of the worlds fastest growth economies since 2002, when they told the banks to take a bath.

Noting that most lenders to Governments have taken no notice of States credit rating downgrades recently.
Government bonds are still considered much safer than private lending.

One of the reasons for the continuing recession in the USA.  The cashed up  prefer to lend to the Government instead of industry and development. Government lending at 0% intended as a stimulus is being invested in 3% yeald Government bonds.

Meanwhile the Media have had almost no coverage of Nationals failure to succeed, even under their own terms. If we had a credit downgrade under Labour it would have been frontline news.

A rugby players nuts are more important!

You did not do it on your own.

Kia-ora