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.
Sunday, June 3, 2012
Saturday, June 2, 2012
Police Assault Protesters in New Zealand.
Kia Ora
Recent protests, against Government policy, by Students in Auckland were greeted by an overwhelming and aggressive police presence.
New Zealand Police have just made it clear they consider there is no right to protest, if it “inconveniences” anyone.
In fact the students were going about their lawful business. PROTESTING IS STILL LEGAL IN NZ.
The police obstructed members of the public and assaulted them. WHILE THEY WERE GOING ABOUT LAWFUL BUSINESS.
Just like police in the UK.
Of course knowing you are likely to be violently assaulted by police, if you protest, has rather a dampening effect on free speech.
No doubt that is what is intended by the police overreaction.
Practicing for when the population finally realises, like the Greeks, how much they have been lied to and exploited.
How long before we see the other repressive actions of an authoritarian dictatorship, to legitimate dissent, here. Like the "kettling" in the UK.
Recent protests, against Government policy, by Students in Auckland were greeted by an overwhelming and aggressive police presence.
New Zealand Police have just made it clear they consider there is no right to protest, if it “inconveniences” anyone.
In fact the students were going about their lawful business. PROTESTING IS STILL LEGAL IN NZ.
The police obstructed members of the public and assaulted them. WHILE THEY WERE GOING ABOUT LAWFUL BUSINESS.
Just like police in the UK.
Of course knowing you are likely to be violently assaulted by police, if you protest, has rather a dampening effect on free speech.
No doubt that is what is intended by the police overreaction.
Practicing for when the population finally realises, like the Greeks, how much they have been lied to and exploited.
How long before we see the other repressive actions of an authoritarian dictatorship, to legitimate dissent, here. Like the "kettling" in the UK.
Friday, June 1, 2012
On Austerity
Kia-ora
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.
NZ, and much of the rest of the world, 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.
Saturday, May 26, 2012
House Price Inflation
Kia-ora
House price Inflation
It is a conventional economics axiom that increasing the money supply without a concomitant increase in production causes inflation.
In the last thirtyfive years we have had low inflation in wages.
Essentials, including land , and thence housing and farm prices, have gone up many times the rate of wage rises.
Land inflation is driven by private Banking's incentive to print money. The more money they supply the more interest they can make.
Unfortunately, there is also a strong natural incentive to lend only on solid security, such as land and buildings.
Banks know better than anyone the inherent insecurity and instability of financial instruments, including shares.
Mortgage law in most Western countries favours lending on land. Unlike other investments, or lending, if the value of the security, land, goes down, the borrower is still liable for the full amount of the loan and interest. The bank is indemnified against loss.
For example, in New Zealand, the bank has priority over all other creditors, including contractors.
Lending on business and other assets does not offer the same security. The bank has to wait in line with other creditors and, normally, cannot continue claims in excess of their proportion of the sale.
Banks, while reluctant to risk their own money, are happy to risk small savers investments. Our pension funds, bank deposits and savings.
These schemes, whether shares, derivatives, hedge funds or other financial instruments are designed so that banks can gamble with our money. Win or lose they always get a cut.
De-regulation of banking has removed almost all constraints on lending and the amount of wealth banks can take.
Loses come out of our pensions and other savings. Or, if they really stuff it up, taxpayers are expected to borrow more from them to pay for it. "The bailout".
The total monetary value of financial instruments and debt is now so great that a crash, or super inflation, is inevitable if it is ever fully spent on real production.
Does anyone really think that infinitely compounding interest is possible in a world with finite resources.
While we lose our savings, houses and farms, bankers still get richer.
Given the difficulty in obtaining bank finance without land as security, favourable tax treatments (in Western countries for banks, homeowners, landowners and farmers ), incentives for banks to avoid risks inherent in other investment (The inevitable crash of Banker's ponzi schemes and the likely devaluation of currency denominated investments) it is not surprising that investors prefer land.
The Chinese Government buying up land worldwide with US dollars, before they become worthless, is only a minor example.
Hence land prices rising much faster than wages.
Our economy, along with most other Western economies has been skewed, towards speculation in existing assets, by banks following their own self interest. The "invisible hand" has failed
Sunday, April 22, 2012
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.
'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).
"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.
"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.
Truly voodoo economics.
Saturday, March 31, 2012
Ports of Auckland and Union Busting.
Kia-ora
For non-New Zealand readers.
Ports of Auckland have just engaged in an episode of managerial self indulgence to try and remove Union members from the port and replace them with casual contracted labour. FYI. The port manager is paid more than 750k. Board members are paid 100 to 200k for one days work a week.
There has been a big push from the usual suspects to take the port out of public ownership. Most of the prospective buyers are anti Union.
Unions and workers are being attacked on all sides, and public assets given away to the private sector as fast as possible, as our current right wing Government is unlikely to get another term.
For non-New Zealand readers.
Ports of Auckland have just engaged in an episode of managerial self indulgence to try and remove Union members from the port and replace them with casual contracted labour. FYI. The port manager is paid more than 750k. Board members are paid 100 to 200k for one days work a week.
There has been a big push from the usual suspects to take the port out of public ownership. Most of the prospective buyers are anti Union.
Unions and workers are being attacked on all sides, and public assets given away to the private sector as fast as possible, as our current right wing Government is unlikely to get another term.
On Incompetent Management.
Once upon a time, decades ago now, ports were run by a person called the Harbourmaster.
He used to be a highly qualified and experienced Master Mariner, who had extensive knowledge of shipping and decades of experience, at sea and within the port.
All this competence and experience came at a wage at most five times the average wage.
Then, along came the cult of management, and the Neo-liberals. The idea that a jumped up accountant could run anything.
They can, into the ground. http://kjt-kt.blogspot.co.nz/2011/04/kia-ora-corporatism-and-neo-liberalism.html
"The corporations with the largest income gap between Directors/Managers and employees have proven to be the least functional.
The star managers paid in millions have proven to be much less effective than, lesser paid, experienced promotions from within the organisation.
"companies that exclusively promote CEOs from within outperform companies that recruit CEOs from outside the company."
Now.
We have a board and managers who have lost the port's public owners 21 million dollars and counting, lost more customers in a few months than have been lost to Tauranga in years, cost the ports customers millions, and demoralised and lost the co-operation of their trained labour force, all to make savings that have been shown to be available anyway by talking to the Union.
(There was a 25 to 30% increase in the box rate last year in the brief period when the Wharfies thought management were not going to continue the adversarial politicking of the past).
An honourable management and board would all be tendering their resignations after a debacle like this.
The amount of spin and outright lies about the workforce from POAL management shows they are incapable of working co-operatively with their labour force.
For example Labour utilisation rates, costs of Labour and pay rates are not out of line with similar jobs.
Still looking for the wharfie who gets 91k a year. (A foremen doing double shifts all year maybe).
The relationship is broken. It is much easier and less costly to replace the managers with ones capable of working with people than retrain a whole ports labour.
It has become apparent that the whole exercise was an ideological attempt to break one of the last vestiges of Union power, most likely with the covert backing of the NACT Government. The huge costs for the ports public owners and customers does not matter to an ideologically driven board put in place for that purpose by ACT hacks..
Wednesday, March 14, 2012
Disaster Capitalism
Kia-ora
Disaster Capitalism
Naomi Klein on Disaster capitalism is an interesting book to re-read, especially in light of recent events in Europe. http://www.naomiklein.org/shock-doctrine
One cannot help thinking that National, in New Zealand, (NZ's GOP) and their supporters have taken it to heart. They certainly seem to be keen on precipitating an economic disaster. The only possible reasons are either they have bought into their own propaganda,
OR they expect to gain by it.
It has been obvious for a long time that political parties that support Neo-Liberal economics cannot survive on funding from individual party members. They just do not have enough public support for this to occur. Almost all their funding comes from corporates and a very few wealthy individuals.
Only by bearing this in mind does their determination to socioeconomically wreck whole countries become understandable.
Only by bearing this in mind does their determination to socioeconomically wreck whole countries become understandable.
Sunday, January 15, 2012
Bowalley Road: The Auckland Ports Dispute: An Injury To All
Bowalley Road: The Auckland Ports Dispute: An Injury To All
"Auckland Regional Holdings was clearer in 2009 stating: “The sector is engaging in destructive interregional competition that is detrimental to New Zealand’s long-term productivity and competitiveness, and could be considered an instance of “market failure”. For the good of the country, it is clear that the port sector needs to change and focus on the real threat – not from each other – but from outside.” 2
The current move to slash employment costs by making staff on-call, round the clock casual workers without compensation for lifestyle or job insecurity is another step toward creating a third world nation"".
Kia-ora
"Auckland Regional Holdings was clearer in 2009 stating: “The sector is engaging in destructive interregional competition that is detrimental to New Zealand’s long-term productivity and competitiveness, and could be considered an instance of “market failure”. For the good of the country, it is clear that the port sector needs to change and focus on the real threat – not from each other – but from outside.” 2
The current move to slash employment costs by making staff on-call, round the clock casual workers without compensation for lifestyle or job insecurity is another step toward creating a third world nation"".
Kia-ora
Saturday, November 5, 2011
Show me the Money??
Kia-ora
Show me the Money??
Easy. The wealthy stole it!
One of the No-Liberal memes is if you allow more of the wealth produced by workers to be retained by the wealthy they will invest more and everyone will benefit. The trickle down theory.
This graph from the New York Times NYT gives the lie to this theory.
Given more money the wealthy simply spend of gamble it in more and more dysfunctional ways.
We can see the same effects in Britain and New Zealand. The effects of Britains belief in voodoo economics.
In New Zealand we have an even stronger correlation.
NZ Governments economic records.
From the Nationalisation of banks and a socialist Labour Government which ended the 1930's depression ahead of most of the rest of the world. To the great recession caused by the adoption of Neo-Liberal dogma from 1984. The rise in incomes and prosperity generally when the Neo-Liberal prescription was relaxed a bit in 2000.
The detrimental effects on a country, by all measures, even their own ones.
of the Neo-Liberal, cut wages, cut taxes, sell everything, deregulate give to the wealthy are conclusively proven.
Looks like even the ratings agencies prefer more left leaning administrations.
Show me the Money??
Easy. The wealthy stole it!
One of the No-Liberal memes is if you allow more of the wealth produced by workers to be retained by the wealthy they will invest more and everyone will benefit. The trickle down theory.
This graph from the New York Times NYT gives the lie to this theory.
Given more money the wealthy simply spend of gamble it in more and more dysfunctional ways.
 | ||||
| The effect of policy on inequality |
In New Zealand we have an even stronger correlation.
NZ Governments economic records.
From the Nationalisation of banks and a socialist Labour Government which ended the 1930's depression ahead of most of the rest of the world. To the great recession caused by the adoption of Neo-Liberal dogma from 1984. The rise in incomes and prosperity generally when the Neo-Liberal prescription was relaxed a bit in 2000.
The detrimental effects on a country, by all measures, even their own ones.
 |
of the Neo-Liberal, cut wages, cut taxes, sell everything, deregulate give to the wealthy are conclusively proven.
Looks like even the ratings agencies prefer more left leaning administrations.
What Our Financial Masters Really Think of Democracy.
Kia-ora
On the axed Referendum.
"In Athens, several ministers and governing party MPs called for Greek Prime Minister George Papandreou to step down in favour of a coalition national unity government that would approve Greece's bailout package without a referendum,"".
The so called representatives of the people. Do not want the people to decide on how to respond to a package.
To bail out even more bankers who made bad lending decisions and pushed prices up to increase their income..
It is becoming very obvious who the real rulers of the world are.
Revealed the capitalist network that runs the world
Despite the lip service to "Representative Democracy".
It is not the citizens of each country.
On the axed Referendum.
"In Athens, several ministers and governing party MPs called for Greek Prime Minister George Papandreou to step down in favour of a coalition national unity government that would approve Greece's bailout package without a referendum,"".
The so called representatives of the people. Do not want the people to decide on how to respond to a package.
To bail out even more bankers who made bad lending decisions and pushed prices up to increase their income..
It is becoming very obvious who the real rulers of the world are.
Revealed the capitalist network that runs the world
Despite the lip service to "Representative Democracy".
It is not the citizens of each country.
Subscribe to:
Posts (Atom)