State of the Nation 2 - Why privatising public assets will hurt most NZers

So we've heard John Key's "vision" for New Zealand. Unsurprisingly it is one where the state is further stripped of the vital resources it needs to support a just and healthy society, and selling off public good assets we will need forever is seen somehow as a good business decision. It is, inevitably, a transfer of shared public wealth into a few private pockets.
Tumeke pretty much nails this point.

It's true. The idea of New Zealanders investing in their own infrastructure is not a bad idea; the problem is, in the current laissez faire deregulated environment, the inevitable result is a disaster for the vast majority of New Zealanders - ie, anyone who has to keep an eye on their bank account and actively save for a house retirement, etc...

An example. You know how you have your favourite brand of biscuits? And they're good and they're cheap, and not too unhealthy either. But then the company that makes those biscuits lists on the stockmarket. The biscuits are quite popular, so it's a good buy for investors. They buy shares which earn them more money.
However, these investors can afford MUCH better biscuits, so they don't care about the product. So they get demanding of their biscuit company. The new CEO of BiscuitCo. promises to the market even greater growth in profits next year. To do that, he shrinks the size of the packet.
The next CEO makes the same promise. To achieve it, he raises the price up a bit.
The next CEO has huge boots to fill, but he's up to the challenge. He decides to change the recipe, using cheaper ingredients, and is so popular with the shareholders of the now mammoth BiscuitCorporation that he even sends production offshore to save more.

The real problem with shareholders in a deregulated - that is, there are very few laws limiting what corporations can and can not do - is that companies quickly lose sight of who their customer is. They can get huge injections of wealth on the stock market, by cutting the quality of their actual services they're supposed to be providing to the community.

Now, that's okay (kind of) with biscuits. Sad as it is, you can stop buying them, change brand. Phew. But food in general - well you need that. Another safe investment on the sharemarket. Who doesn't feel like a victim when you go to the supermarket and see bread/cheese/meat has gone up again?

And so Mr John Key's brilliant idea is to hand our power companies - again, something we all need - over to shareholders. The shining model is supposed to be Air New Zealand and how prices have fallen for their flights. But excuse me? It may have gotten cheaper Wellington-Christchurch-Auckland, but regional we get repeated engine failures, cancelled flights, less flights. Hamilton to Wellington costs 3-4 times the price from Auckland! We're treated like cattle.
And don't mention the new credit card charges they've introduced just because they are a monopoly and they can. They are not legally bound, not regulated, to treat the consumer with anything like a sense of justice and conscience.

That's why public goods - things everyone needs, like power, food, housing, clothing, communications, transport - need to be regulated, if not in government hands. The law is supposed to codify those morals, for all of us, that's what it's there for: including corporations.

So. We have power companies, who are farcically supposed to be in competition with each other even now. Be warned. At the moment they send people door to door, hoping to sign us up, promise a $50 credit or something. That's their main pitch, trying to get more customers - more "market share".
Well. If the power companies are privatised, even to only 49% as promised, the real issue is not foreign ownership; the companies will forget about you, the customer, and primarily be interested in wooing shareholders. And the best way of doing that is raising prices in every tricky way they can. Just like BiscuitCorp.

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It's like I was saying yesterday about the tax system. The government takes far too much tax from the VAST majority of us, and nowhere near enough from a very wealthy few. Because off this, we scrape and gripe and struggle, and learn to distrust, even hate government. But in a democracy, the state is the one institution that is supposed to be there standing up for all of us. We need it well-funded - yes, slow and clunky sometimes, that's what democracy is - but it needs money to make sure we all have a fair go. If you are struggling to save, or get out of debt, or buy a house, or dream of keeping a parent at home with the kids like your parents had, shrinking the wealth and health of our state is actually against your interests:

Think about where most of your money goes. Is it to the government? Or is it to a few food giants? A bank maybe? An oil company. A telco. A power company. Privatisation takes power from the state - from all of us - and gives it to companies who already control where most our daily dollar goes.

Overall, I think the difference between the two party's was well-represented by images we saw of their audiences for Goff and Key's speeches. Goff spoke in a community hall to an audience of all ages, ethnicity, classes. Key spoke to a conference room of black suits; and no, they do not represent the entire business community. Just that very elite end of businesses, that like to pretend that what is good for corporations is good for businesses of all sizes in our country, and everyone.

That is not democracy.

As far as the state of the nation goes, we don't need politicians to tell us. We each need to look at hard at our own lives, and think about where our money goes, how much we've saved, how many hours we're working, how many hours we see our children, whether we can afford children, whether we can afford a house - whether we can ever really see ourselves getting a decent job. And start to question. What is fair? What is just? Things have been like this for more than 25 years. Why hasn't some government done something?

Then, it's fair to start getting mad.

State of the Nation 1 - $5000 tax free a start, but not enough

I'll defer a "Fantail" state of a nation for another day to clear some of the must with a comment on the latest over at Tumeke on Phil Goff's State of the Nation. Bomber's report was interesting and personal, and strategically on the button. Specifically:

Goff's real trump card is his first $5000 tax free for all NZers. This impacts most on those who are earning the least and will be funded by a new top tax bracket that will be in the high 6 figure area so that professions not considered top tax bracket fodder don't fall foul of it.

The $5,000 tax free may be a trump card, but the difficulty Labour face this year was demonstrated in TV1's coverage of the speech. Their report didn't cover how Labour would pay for it: instead they cut to John Key saying that costly, overseas creditor "pixies (3x)" would pay for the cut - breaking up any the Labour narrative with what amounts to a bald opposition lie.

This is of course unsurprising coming from the national broadcaster, who have spent the last two years treating Key like a neutral political commentator and the vast majority of their stories focussed on taking pokes at the out-of-power opposition party instead of questioning the very in-power government. I remembered my jaw dropping when this soft-soaping started, the very first government policy release coming from the ACT party (appropriately). It was about on "cutting red tape" and passing legislation to allow people to opt out of the building code. (I reckon most of the good people of Christchurch are probably quite happy with about all that annoying bureaucratic tapes and codes stuff bout now). Mark Sainsbury interviewed on this Rodney Hide with all the rigour of a Swedish massage, and very little has changed.

Besides the media living in its own self-reflective balloon of public perception, The Youth Idol element of Key is definitely there - first time voters tend to "rage" against the incumbent government, and many young people know no government other than Clark's. Of course the real rebellion is to vote as Left as possible to try and get our society somewhere back to a reasonable centre again. Largely, that demographic is there for the taking, if they can be motivated. Most are at worst ignorant, if not poor, angry and scared.

Finally, the over 50K cadre should not be ignored. They're not homogeneous, and from my experience, household incomes have to reach 50K just for 2 people to be healthy and debt free - and that's renting, no retirement, no savings. That the tax brackets are marked at 14K, 48K and 70K gives a false impression of what is rich and what it costs to live in our society.
Markedly, it punishes and causes gripes for those struggling under 70K; and it groups all those people earning 70K with those earning millions, as if they have anything in common, in lifestyle or obligation to the community that has supported their success.

Phil Goff was right to point to those 700 multi-millionaires who grabbed another $1000 a week from John Key's tax cuts. That's 36 million from the wealth and health of our public services - gone.

So what's the state of our nation?

Let's see what the PM has to say later today.

A Portrait of How Far We're Right

Tipping my hat to a couple of great "Left-wing" sites. I use the inverted commas, because "lefty" is thrown around like that means these commentators want a command economy and everyone doled out the same few cents from a bulging public purse. I've never read anything from either The Standard or Tumeke that suggests this is the case.

If they, like many of us, are pulling "left", it is because the "centre" of an intelligent, responsible government presiding over a mixed economy, was abandoned by our government 25 years ago. In 1984, the 4th Labour government (which was not "left" at all) decided the best course of action for managing the complications of a modern economy was to not manage it at all. This government and its successors have progressively sacrificed the principle that they are there to act on our collective behalf, in favour of the idea that as long as there is more money in the economy ("growth") that is an inviolate good, and makes life better for everyone.

This transfer of power away from Democracy towards Capital - the wealthy, at the expense of everyone else - was prescribed from 1972, in Samuel Huntingdon's "Crisis of Democracy", and it has been in process ever since.

The real effect of these "free market" principles have been to open society to the law of the jungle. It is feudal; it is like the wild west. But instead the power isn't with those with the army or the bigger gun. It's the bigger chequebook. Money is power. Literally you can tell where you stand in a capital-dominant society like ours, by comparing your bank-balance with that of whatever individual/organisation you're up against.

Democracy is supposed to be the balance for this. But because government accepts profit and growth as some lower common denominator that is good for everyone, they do not intervene with "red tape and regulations" - you know, safeguards. All that annoying stuff that the last Labour government started putting back in place, and National is cutting away. Or "streamlining", making "efficiency gains", or whatever crap the media swallows and spits out on our screens.

Hey - democracy is slow. It is inefficient. It is costly. But it is cheaper to combine our money and empower our government to act on housing, food, communications, energy, water, clothes, insurance - keeping the cost of living down - than it is for us as individuals to throw our cents around in a market dominated by corporate millions.
Without democracy, the only real "law" of the market is that the individual/corporation with the bigger chequebook always gets his way. As Tumeke reminds us.

Of course, people are persuaded by the idea of tax savings, tax cuts, yada yada. And you know what? Fair enough. The vast majority of people are being taxed too much, from the money they need to support themselves. It's power they need to save and expend how they choose. A real choice society.
But less tax for them does not need to come at the cost of a responsive, well-funded democracy. Because the way our economy is structured, there is a small cluster of individuals and corporations that are being taxed nowhere near enough.

I've crapped on enough for one day, but here's the Standard's post. It talks about how John Key, the prime minister of our democracy, is being spat on by the money in our society, cheer-led by Rodney Hide, Roger Douglas, Act and their corporate backers.
I wouldn't say John Key is weak, so much as he is vulnerable. He is vulnerable because he relies entirely on his support staff for political advice. He doesn't know anything about democracy, or why a cabinet room is not the same is a board room. Why we are not "NZ Inc". He comes from a banking background, so many eminently "logical" ideas about manipulating numbers for profit make sense to him without any conception of the consequences of exactly the same policy of say, oh, the last 25 years. It's be no surprise if he's suffering from impostor syndrome.

And this government is full of both crowds - the Bennetts, Tolleys, Wilkinsons, Brownlees - like those little plastic cows whose heads nod when you tap them, their knees buckle when you press the right button. They have no clue, except what will get them fed and watered and praised.
Then there're the ideologues: English, Williamson, Ryall & co, who have been sitting on the opposition benches so long, talking to themselves and their same rich friends, they don't realise the rules of the last decade don't apply any more. Their ideology, their free market has been proven broken. 2008's Financial Crisis was not just a cough - it was a heart attack, and the system has been thrust up on life-support, shuffling around until those with all their wealth and prestige invested in it can restructure so when the global economy collapses, they're not under it.
NZ's ostrich approach to Copenhagen and emissions just shows how far our government is stuck in the 90s. There is an ever-growing realisation that, uh, yeah- the Club of Rome was right: there are limits to growth. If Lord Stern of Benford says "We might all have to go vegan to save the planet", there's no point saying "he's trying to ruin our economy!" More sensibly, take that as a measure of how much ground we have to make up with other measures or some brilliant new-fandangled technology. Because man-made or cyclical, global warming is still gonna get us.

I'm reminded of the Portrait of Dorian Gray. It's like this extreme right ideology was painted for Roger Douglas in 1984, gorgeous, perfect; handed over to Ruth Richardson in the Nineties, where the painting picked up some strong vain lines and ghastly knowing eyes; under Michael Cullen it matured, remained superior, silvered, with the first signs of decay...
Of course none of these governments uncovered the portrait to look on it, less they lose its power.

So now Key and English are carrying it around, cheered on by National party triumphalism, maybe actually believing they're full of fresh, invigorating ideas. While under the cover, the painting - their ideology - has sickened and wrinkled into some jaundiced old ghoul.
There are signs around the world, mostly beneath the government level, that this has been noticed. It remains to be seen whether NZ opens its eyes, or continues to suffer under the beast riding its back.

Breakfast with Marie Antoinette

Is there a worse experience in the country than waking up to Paul Henry?

I mean, there you are, in your gown, a bit of toast, turn the TV on - and IT's on the screen.

Pure accident of course. And I know, everyone knows, it's scarcely worth mentioning. But he just happened to be leading a segment that perfectly captured everything that is so odious about him.

He was talking about the referendum on MMP.

John Key of course mumbled something not too loud about holding the referendum pre-election, and so Henry (ex National Party candidate) championed it as the inviolate virtue "keeping his promise to the NZ Public."

Honestly, the only policies I can remember from Key and National was cycleway and super-fast broadband. Everything else was maybes, mumbling and "we'll have that discussion when...".

Henry was interviewing the excellent electoral and constitutional expert Jonathan Boston from Victoria University (my alma mater), which was home to an MMP review working group when the electoral system came up for review in 2000.

I actually sat in on the session where Professor Boston made a submission for improvements that year - the discussion went very much as you'd expect between an expert with a PhD from Oxford and a dozen party politicians who don't know pol-sci from that thing where old people get shaky hands.
It is an indelible failing of our political system that the people voted to represent us have very little understanding of democracy or constitutional power. It makes them very vulnerable to persuasive "common-sense" and "pragmatism" from rich people promising to make us all richer. If we just make them even richer first.

Paul Henry is, of course, both: both wealthy and thinks a constitution is something you need for a good Friday night.

Actually, he gave Professor Boston a fairly good platform to say what he wanted, which was the least we can ask. Boston made it very clear that any problems with MMP can be fixed within MMP. I would add - it is crucial to add - that to see if MMP works, you have to compare and contrast with what it was fixing: that is First Past the Post (FPP). And on the balance, and by the standards set out by the Electoral Reform Commission, it has been a raging success.

At creating a more representative, more legitimate form of democratic government.

Regression to FPP or it's bastard nephew, Supplementary Member (SM), will result in less democracy. In our society, there is an undeniable and necessary conflict between democracy and capitalism. The Big Money in our country just want it even more their way.

That is why National are pushing for it. That is why wealthy lobbyists are building war-chests and PR campaigns for it.

That said, it is likely that there are many people who are not wealthy who have developed frustration with MMP. With the confusion. The threshold. The Maori seats. The number of well-paid MPs.

And I say to them: if you are struggling, in our society, with mortgages and rent, rising energy and phone and food costs, it is very easy to work out what is in your best interest: More democracy.

MMP is good democracy, but it can be made better. SM is less good. FPP is not good at all.

And if you still find it hard to work out what's in your best interest, remember Paul Henry. Because he is NOT a democrat. He is an autocrat - even an aristocrat, our own squealing, honking, wine-sipping Marie Antoinette. He and his pals live on the fat of our land, he pollutes our airwaves and gets paid for it and broadcasts his personal point of view as if only it makes sense.

"Because New Zealanders are stupid," he said this morning, "most of the people out there are stupid." And he believes that, because we go along and vote stupid and make our own lives harder.

2011 is plenty of time to show him who's stupid.

Not Happy, John

Prime Minister John Key debased himself and the country on the Late Show with David Letterman yesterday.

"Somebody" apparently, is calling this humiliation a "coup" which means that some of his Public Relations lackeys have written a press release and the media has swallowed it whole.

And I say this, of course, because 90% of the news we read/see/hear, is press releases. Which is 99.9% true, but on the whole... a topic for another time.

So back to John Key. Prime Minister. And now, trivial amusement.

The Australian Prime Minister Kevin Rudd goes on Rove McManus's show in his own country, and that is a huge gesture. It is heart-warming that he steps out of his comfort zone, remains, dignified, squirms when having to tackle the obligatory question of homosexuality (Rudd is quite a devout Christian)... but there's a latitude, because is the PM exposing himself to his own nation with a respectful host who is invested in the country under discussion - Australia.

Mr John Key, however, with David Letterman... There is no affection. There is no relationship or investment with his audience. It is 100% ass-lickery, playing the jester for the benefit of a off-humour dweeb and his ignorant audience who couldn't care less about New Zealand, but it makes them feel special and powerful to have some hick travel from across the world and perform in their off-Broadway court. It was practically medieval. If they'd been eating, the crowd would have thrown bones just to watch our Prime Minister fight the dogs for the right to eat them off the floor.

For tourism, they say. Huge, HUGE coup! Well, I hope so. There's not much worse for a prostitute than when the client won't pay up afterward. Cos that's what it was. Whoring. Selling his status as our leader, the pinnacle any NZer can hope to achieve, in the hope of a few bucks.

Or necrophilia, cos hoping for tourism from the US - that's a dead horse. At the rate their dollar's bombing, well have dollar parity by the end of the year, and the recession (or the next one that is a micro-blip away, if you want to be pedantic) will keep Americans at home, holidaying at home.

Ultimately, I don't blame John - he looked as nervous as hell. I think, somewhere inside, he knew it was the wrong thing, doing his folksy campaign-trail thing on the international stage. I hope he reflects on this and realises a country's culture and democratic history -its prestige - goes far deeper than some some marketing line or gag image.

I blame those soulless suit-advisors around him, and hope he fires every one of them.