When the Government legitimises violence

There has been a spate of violent robberies of dairies* in Auckland targeting cigarettes. The store owners blame the huge increases in taxes on cigarettes that have pushed the price to nearly $30 for a pack of twenty. This has made cigarettes almost the equivalent of illegal drugs and predictably has seen the rise of a black market and an increase in robberies and violent crime to supply that market.

The worst thing about this escalation of crime is the Government's reaction to it. National Government MP Nicky Wagner, who holds the post of Associate Health Minister, responded by saying the store owners should stop selling cigarettes "if they feel too threatened" by robbers.

Let us consider the implications of what Wagner is saying. She is implying that the store owners are fair game for violent robberies - if they didn't sell cigarettes, they wouldn't be attacked - and that the Government won't protect them. In other words, the Government is willing to let violence against New Zealanders carrying out a perfectly legal commercial activity continue if it serves some other policy objective, i.e. reducing smoking.

This is disgraceful and something I never thought I would hear from a Government minister in New Zealand. Does Nicky Wagner and her Government not understand the potential consequences of this? When the government is unwilling to protect you against violent crime, and in fact legitimises that violent crime, you are left with no choice - to take the law into your own hands. It is an abrogation of the most basic responsibility of government - to protect citizens against violence - and a recipe for anarchy.

Perhaps Nicky Wagner did not intend to say what she said or was misquoted - if so, she needs to make that clear because this is an incredibly dangerous path she has set us upon.

* Convenience stores in New Zealand are commonly called 'dairies' because they traditionally sold dairy products.

[Hat-tip to blogger Lindsay Mitchell for bringing this to my attention.]

Governments' use of data is scary

The answer to poor government is always more government, at least amongst those who are part of the Leviathan. New Zealand's National Government says it is driven by values of 'personal responsibility' and 'limited government' and Prime Minister Bill English has talked a lot about reducing state dependency and targeting services to those in highest need. He has been explicit about how he plans to do this, most recently in his statement to Parliament in February in which he said, 'the Government will this year further improve the way in which data is used to underpin decision making through initiatives like the Integrated Data Infrastructure.'

The Integrated Data Infrastructure (IDI) is a big database held by Statistics New Zealand that receives feeds from many government and some non-government organisations, including the Ministry of Social Development, Inland Revenue, Ministry of Education, Ministry of Health, Department of Internal Affairs, Ministry of Justice and New Zealand Police. There is a belief that the data in the IDI is anonymous but that is not true. The database uses a common identifier to link the records from the different agencies and, although sufficient personal information to readily identify the person is not usually provided to third parties, the IDI records are linked to real people.

I have had a great deal of experience in the use and protection of information both in the private and public sectors and I believe many people in government have little idea of the risks involved in the aggregation of data. Even if we accept that government agencies are good stewards of people's data (and, as I show below, the evidence is that they are not), the IDI opens up this data to almost anyone who wants to use it. There is an application process but few checks on those who apply. I do not believe those responsible understand the power of technology available to mine and de-anonymise the data and have little appreciation of how it might be used.

An overseas example of the risks is the United Kingdom's experience with care.data, a National Health Service initiative to aggregate health and social care data and make it available for research purposes. Soon after the initiative was launched in 2013, it was rumoured that private sector organisations such as insurance companies were de-anonymising the data to reveal whether customers were withholding information on pre-existing conditions and risk factors such as mental illness. A report into the risks concluded that 'the current care.data program is highly problematic in its flawed protection of patient anonymity, an unsuitable opt-out system, unclear criteria for accessing the collected health data, and the risk it poses to the trust between patients and general practitioners.'

There are many other examples of the lack of adequate protection for individual data in government, including here in New Zealand. The 2012 revelation that Ministry of Social Development's self-service kiosks could be used by anyone to access confidential details of at-risk children is just one example. I have personally seen other examples of significant security flaws in agencies' information systems that have not been revealed publicly. But the risk is not confined to the information falling into the wrong hands - there is also considerable scope to link the wrong data to the wrong person. Statistics NZ admits that 'some records can be linked incorrectly or the link could be missed'. I am sure I don't need to spell out the implications of a law enforcement agency using incorrectly linked data.

I think governments' increasing aggregation of personal information and policies of allowing almost unrestricted access to it, are dangerous and unnecessary. I accept that there is the potential to deliver services to people more effectively by better understanding their needs - after all, this is exactly what Amazon and every other online merchant does - but the risks with governments misusing the information are far greater. The worst Amazon can do is to try to sell you something you don't want, but if the government draws the wrong conclusion from the data, it could destroy your life.

I think it would be better to rethink the role of central government in providing many of the services for which it believes it needs aggregated data. People in need can be better served by local service providers that are closer to the people requiring the services, using information collected from the individuals concerned and those in the community who understand their needs better than any central government agency. The more government tries to manage and target the services it delivers through centralised aggregation of information, the more intrusive into all our lives it needs to become and the greater the risk of wholesale misuse of the data. Central government is always a blunt instrument when it comes to dealing with the problems in individuals' lives and trying to build a sharper sledgehammer is not the answer when what is needed is a scalpel.

Little in name, small-minded in policy

Three terms in opposition will make any political party desperate and the New Zealand Labour Party is no exception. That is why we have seen Andrew Little, the leader of the Labour Party who was elected not by a free vote of individual party members but by the block-voting of union affiliates, push two new policies that are cynical in the extreme. Firstly, he has proposed Labour will introduce three years' free tertiary education. Currently, many tertiary students take advantage of the government's no-interest student loans policy, a significant financial benefit over previous interest-bearing loans that was introduced (at considerable taxpayers' expense) by the previous Helen Clark Labour Government. The new policy is expected to cost around $1 billion per year.

Let us examine the impact of this new policy on two young people. The first chooses to study law and after graduating will quickly rise to be amongst the highest income earners in the country (probably representing Maori tribes seeking even larger Treaty of Waitangi claim payouts from the government - the most lucrative legal gig in New Zealand these days). The second chooses to leave school and use self-taught web development skills to start a small business building websites for local companies. This latter person takes the most risk and while he or she may make a reasonable income they are unlikely to make anywhere near the eventual income of the law graduate, and yet the web developer will have to pay more even taxes to support the lawyer's tertiary education. How is that fair?

The worst thing about this policy is that no one is demanding it (apart from, perhaps, the heads of the university students associations). It is so obviously an attempt to buy young people's votes at the next election that one wonders whether Andrew Little has any shame.

The second policy Little has announced is his opposition to the Trans-Pacific Partnership trade agreement. This is despite the fact that it was the Clark Labour Government that signed the original agreement and that all the latest version of the agreement does is to extend the deal to more countries (including the United States) and to more goods and services. Two senior members of Little's team (Phil Goff and David Shearer) have already indicated they will cross the floor and vote with the National Government in favour of the deal.

Why would Little break the unity of his caucus to oppose something his party has always supported? The reason is not so much about cynical vote-buying as about Little doing his masters' bidding. Little's masters are, of course, the union leaders who ensured he became Labour Party leader. The unions oppose TPP because it threatens feather-bedded jobs in protected industries and have ordered him to oppose it. Never mind democratic process, the union bosses have said 'jump' and Little's response is 'how high?'

Everyone expects politicians to act in their own political interests and that of their supporters, but in both these cases the Labour Party is pursuing narrow, sectoral interests rather than the interests of the country (or Labour voters) as a whole. If this is an indication of how a Little-led Labour Government will act, then I hope we never see such a thing in reality.

Biased BBC Typical of State Broadcasters

British Prime Minister David Cameron and his finance minister George Osborne this week attacked the BBC as biased, accusing it of systematic exaggeration in its coverage of the Cameron Government's mini-budget, known as the Autumn Statement. What seems to have particularly riled the Tories is the claim by a BBC political reporter that the budget would take Britain back to the economic conditions described in George Orwell's novel, The Road to Wigan Pier. The only thing about this that surprises me is that Cameron and Osborne are surprised by the obvious left-wing bias of the state broadcaster.

Here in New Zealand the media, and in particular the state-owned broadcasters, show similar political partisanship. A few days ago I was in a taxi and the cabbie was listening to Radio New Zealand National's Morning Report programme, which has a heavy focus on coverage of local political affairs. Now, I stopped listening to National Radio during the 2008 election campaign when the station made no attempt to hide its hugely biased coverage in favour of then Labour Prime Minister Helen Clark over (successful) centre-right National Party challenger John Key. I was tempted to ask the cabbie to turn it off but decided it would be interesting to see whether National Radio's coverage of politics had become any more even-handed. There followed the most appalling radio interview I have heard in a long time. The reporter, unable to bait her cabinet minister interviewee into conceding what she wanted, resorted to the sort of petulant hectoring one would normally only hear in a drunken pub debate. This endured for five minutes with the cabinet minister maintaining her position calmly and the reporter becoming ever more belligerent.

Of course there is a very logical reason why state broadcasters should be biased towards left-wing political views and that is that state ownership and forcible tax-payer funding of broadcasting services only makes sense to those with Socialist views. It is simply self-interest and self-preservation.

There was perhaps a legitimate economic argument in favour of the state getting into broadcasting in the early days of radio and television, when the entry costs were a high barrier to the private sector, particularly in small countries like New Zealand. It could be argued that if the New Zealand Broadcasting Corporation hadn't established a television network in New Zealand in 1962 then this country may have gone without television for many years after that. Personally I think this is doubtful and in a free market it wouldn't have taken long for small, local television broadcasters to become established (and deregulation in 1989 proved this by quickly leading to the establishment of the privately-owned TV3). But even if such economic arguments had some legitimacy years ago, in the current environment when anyone with a personal computer can set up their own Youtube channel or streaming radio channel, such arguments are ridiculous.

The answer for David Cameron is that he should privatise the BBC. It is the dominance of the BBC and Radio New Zealand through state funding and protection that gives them their political power. In a highly competitive market, the biases of one broadcaster would not matter. 

Labour's cynical election bribe just more legalised theft

The New Zealand Labour Party has announced that if it becomes the government later this year it will introduce a new welfare payment of $60 for babies born to families earning under $150,000 per year for the first year and continuing payments for families with lower incomes. This is on top of the Working for Families scheme that Labour introduced when last in power, which extended welfare to families on incomes of well over $100,000 per year, and other existing welfare benefits. 

As welfare commentator Lindsay Mitchell points out on her blog here, this means that a first time mother in Auckland on welfare will receive $672 per week and a further $124 for every child after that. The median New Zealand full-time wage (June 2013) is $844 per week. An individual taxpayer will pay about 15% tax on their income so will receive about $720 in the hand. Beneficiaries get additional entitlements such as lower cost government services and discounts from many private sector organisations, so you would have to conclude that most young, single women would be better off having babies than working for a living.

The inequity of this situation, and even the fact that all the evidence says that encouraging welfare dependency produces poor social outcomes, are not my primary objections to this policy. It is the cynical opportunism of it that gets to me. No one can seriously argue that New Zealanders incomes of up to $150,000 need welfare, so this policy is not about need. As with Working for Families, it is about making more and more New Zealand families dependent on, and grateful for, the largesse of a Labour Government. Elections are won and lost on the votes of the middle class and these policies bring almost all of the middle class into the welfare system. 

All taxation is, by definition, legalised theft (OED defines theft as to 'take another person’s property without permission'). Most people justify the taxation and welfare system because it enables government to provide for the needy in society. Labour's new policy doesn't even have that merit. As Lindsay Mitchell points out again here, the most commonly used measurement which counts children in households below 60 percent of the median household after-housing-costs income, has fallen from 37 percent in 2001 to 21 percent in 2012. No one needs this policy, least of all higher income earners. Where is the morality in taxing a young school leaver earning the minimum wage ($13.75 per hour) so the government can give money to someone earning say $145,000 per year?

Fortunately I think most New Zealanders will see this policy for what it is - a cynical election year bribe. However, between Labour and its fellow-traveller Green Party, they may muster enough votes to out poll the governing National Party and implement their dishonest policies.

Honours System is Anachronistic and Paternalistic

Once again in New Zealand we have had the announcement of the Queen's Birthday Honours, which of course are nothing to do with the Queen and are not announced on her actual birthday.  A more fitting name for them would be the "New Zealand Government Good Subject Awards" because they are a system of favours bestowed by the government of the day on those they consider to have been worthy.

The current honours system dates from medieval times when the monarch favoured those who supported him or her with lands, money and titles.  The good deeds that were considered most worthy back then would be regarded in most cases today as worthy only of a long sentence from the International Court of Justice, being acts of great cruelty and abuse of human rights such as the dispossession of the Catholics, the expulsion of the Puritans and the Jews, the subjugation of the Irish and the like.  The Queen no longer gives out land and money but her governments around the world still bestow titles on those who are in their favour. 

It has been interesting watching the changes over the years in the nature of the deeds considered worthy of honours.  As recently as thirty years ago, the ranks of the honours lists were full of successful businessmen.  In recent times, the selfish pursuit of wealth, with its consequential benefits to the entire nation, no longer merits honour.  If a businessman receives any recognition, it is only because of their service to some charity, sports foundation, or other 'worthy' pursuit.  Senior judges still get honoured almost as a matter of course, and similarly those from the senior ranks of the civil service.  The awards still remain a reward for political service, irrespective of whether the political colours of the recipient match those of the government doing the awarding (hence the National Government's award to Labour Finance Minister and Deputy Prime Minister Michael Cullen).  It is a system of "you scratch my back, I'll scratch yours" that members of successive governments dare not break for fear they will not get their turn.

The whole idea of a government honours system is inherently corrupt because it inverts the respective roles of government and citizen.  Governments should exist only to serve the citizen through a limited range of executive, legislative and judicial functions (which functions should be tightly defined in a written constitution - but that is for another blog).  The greatest statement of the role of governments ever written says, "Governments are instituted among Men, deriving their just powers from the consent of the governed". In other words, citizens should be the masters of governments, not the other way around.  A government that presumes to reward its citizens for what it regards as good behaviour regards its citizens as subjects, not as masters.  Citizens should not compete for the government's favour, rather the government should compete for our favour.

For eight hundred years years since the signing of the Magna Carta Libertatum (the "Great Charter of Liberties"1), we in the West have fought to restrain the executive power of the monarch in favour of individual rights and self-determination.  It is time we cast off this anachronistic and paternalistic vestige of unrestrained power that is the Queen's Honours system.

1 We seem to have lost the "liberties" bit along the way.

2011 in Review

2011 has been an interesting year.

Early in the year we had the second severe earthquake in Christchurch and this one killed nearly two hundred and left the city with massive destruction. The earthquake was instructive not so much in terms of what it taught us about the impact of such a seismic event on buildings and lives (which was pretty predictable) but in what it taught us about the behaviour of our Government in such a situation. The dust had barely settled before they had deployed troops and armoured personnel carriers on the streets of Christchurch and were arresting and prosecuting property owners for attempting to gain access to their own properties. Clearly John Key's Government has no respect for individual liberty and property rights.

A month after the Christchurch earthquake, Japan suffered a much more devastating one combined with a tsunami that killed more than fifteen thousand people. In spite of its much greater impact, Japan is well advanced with its reconstruction effort.  In the meantime, our national and local governments continue to dither and obstruct those who want to rebuild their lives in Christchurch.

During the year it became blatantly obvious that "spend and hope" economic policies were never going to lift the Western world out of recession. Certainly it is hard to see how more of the same medicine that caused the crisis will cure it. In New Zealand our Government is spending $18B this year more than it takes in revenue, despite increasing consumption taxes and many government charges. Our minister of finance promises we will return to government fiscal surpluses by 2014 but given his projections are based on 4% economic growth and our current rate is about 1%, this seems like very wishful thinking.  In the meantime, various ignoramuses camped in parks around the world, under the "Occupy Wall Street" banner, have chosen to scapegoat bankers as the cause of all the world's problems in a slanderous campaign that is reminiscent of the Protocols of the Elders of Zion that the Nazis used to rally political support in the 1930s.

Governments around the world continued to erode the rights of their citizens with ever more instrusive security and surveillance laws in the name of the so-called War Against Terror.  The least you can say for the panjandrums involved is that they are relatively indiscriminate in their abuse of citizens, as this report of the US TSA's actions attests.  The US Government finally killed Osama Bin Laden but if the Al Qaeda leader's aim was to destroy the liberties that Westerners enjoy, then he has certainly achieved what he set out to do.

Late in the year we had an election and New Zealanders chose to re-elect John Key's National Government in coalition with a motley bunch that including a former National Party minister who was standing for a party whose principles he clearly does not believe in, a former Labour Party minister who jumps in bed with whichever party will give him a seat in cabinet, and a party based on the racist principle that Maori deserve preferential treatment in our society.  I cannot see John Key's appeal as he and his government seem to me to be entirely without any political principles.

The political finale of the year was the death of Kim Jong Il, the nutcase who has ruled North Korea since the death of his father who was the previous nutcase leader of that country. Kim Jong Il managed to annoint his third son as his successor, the sole selection criteria apparently being that the third one was the only of his sons who was not mentally handicapped or gay. It is a sad indictment on humanity that we still have such tyrants as leaders of a significant number of countries.

And finally, we have this incident to greet us a few days before Christmas - an horrific crime against a defenseless 5 year old girl in a New Zealand campground.  It is no surprise that locals report the perpetrator may be a member of the Mongrel Mob - a predominantly Maori gang whom the authorities treat as a welfare organisation rather than the violent, drug-running, raping bunch of thugs it really is.

On that depressing note, I wish you all a very safe and pleasant Christmas and all the best for 2012.

As Good as it Gets?

I read the following in James Delingpole's blog on the The Telegraph's website today and it touched a depressing nerve:

"When Tony Blair and Gordon Brown were in charge Britain’s rapid and terrifying decline was still just about bearable. That’s because in those days you could console yourself that they would sooner or later be swept away by a Tory regime which would swiftly set about undoing all the damage they had done. But just look at the mess we’ve landed ourselves instead: I feel like a bit like a wartime Polish officer who has been rescued from the Germans, escaping execution by the skin of his teeth, only to discover that his liberators are the NKVD.

The worst of the many awful things about Cameron’s bastard Coalition is this: you know that where we are now is going to be about as good as it gets."

It is exactly how I feel about the John Key-led coalition government in New Zealand.

Are Australians Smarter or Braver than New Zealanders?

It has been interesting following the political events in Australia this week with Julia Gillard pushing ahead with the carbon tax she promised the Australian electorate she wouldn't implement and polls indicating the Australian public are overwhelmingly against the proposal and ready to dump the Australian Labor Party for breaking its election promises.

The reaction to this political intransigence contrasts with our experience in New Zealand where the National Government last year pushed ahead with its Emissions Trading Scheme (ETS) against earlier promises, a betrayal that New Zealanders accepted with barely a whimper.

Australians have figured out that a carbon tax is a hugely expensive exercise in futility. They know that any carbon emissions savings that result from the significant increases in energy prices (and the cost of pretty much every other product and service in the economy) will be offset 100-fold by China's increase in emissions over the same period. Unlike Australians, New Zealanders seem to be too stupid to make the connection between the direct impact of the ETS on energy prices and the consequential price increases of almost everything in the economy.

Australians are smart enough to know that the science is far from settled and that actually global temperatures are not consistently tracking upwards with atmospheric carbon dioxide levels but rather have been static for the last ten years.

They are smart enough or brave enough to respond to Gillard's carbon tax proposals with, "Piss off, Mate, we're not having a bar of it!" (or words to that effect).

Australians are smart enough to know that if they don't dig minerals out of ground and sell those minerals to anyone who wants them, the only people who will suffer are Australians - unlike New Zealanders. And they are smart enough to know they need to reduce taxes to generate economic growth and create jobs - unlike New Zealanders.

The New Zealand National Government has given up on its goal of catching Australia in wages and living standards. Perhaps they have conceded that we're not smart enough or brave enough to get there.

Neither Government nor Opposition Will Solve NZ's Economic Problems

We have finally seen a response to New Zealand's economic problems in the National Government's Budget (problems that were clearly illustrated in the Budget document). But it is hardly a brave and decisive response, delivering only small changes to the state's subsidies for the KiwiSaver savings scheme, slightly less generous conditions on borrowing under the Student Loans scheme (but it is still interest free) and slight adjustments to the Working for Families welfare-for-all scheme that Prime Minister John Key called "Communism by stealth" when he was Leader of the Opposition. None of these things will go far in addressing the New Zealand Government's huge operating deficit. The Government claims it will go into surplus in 2014 but this is dependent on achieving 4% p.a. growth in GDP - an unlikely prospect if the country's recent economic performance is anything to go by.

And what of the Labour Party's policies? Since the Budget Phil Goff, Leader of the Opposition, has announced that Labour will:
1) Establish a Ministry of Children
2) Restore research and development tax credits that National abolished
3) Pay for the above by bringing agriculture into the comprehensive Emissions Trading Scheme (ETS) two years earlier than planned.

Of these policies only the second is likely to have any beneficial economic effect. Establishing a Ministry of Children will be a cost with no benefits (not even to children's welfare, in my opinion) and extending the ETS earlier than planned will only increase the direct costs to the economy of this pernicious scheme, again with no benefits (given New Zealand produces just 0.2% of total global anthropogenic carbon emissions).

So neither party's policies are going to address New Zealand's slide into the sort of economic hardship of the type currently being suffered by the PIIGS countries (as discussed in this blog). This is because neither party contains any politicians with the intestinal fortitude to tackle the problem. Our politicians of all persuasions are pathetic, poll-driven, moral pygmies who would rather see our country become destitute than risk their popularity to implement the reforms that are necessary to generate economic growth.

I believe our politicians grossly underestimate New Zealanders' intelligence and integrity. I believe most New Zealanders understand our current economic plight, especially since the Christchurch earthquakes, and are willing to accept far greater austerity measures than this Government has introduced with its Budget. But it would take a leader with more courage than John Key or Phil Goff have ever shown to risk his or her political career to do what needs to be done.

$12m fine adds insult to injury

Telecom New Zealand has been fined $12 million by the High Court for "misuse of market power" between 2001 and 2004. The fine relates to the prices Telecom charged for its data line "tails" (the last part of the line to a customer's premises). Already I can hear the whingers and bludgers in this country cheering from the side lines, where they always sit. Big, bad Telecom has been punished for its anti-competitive conduct, I hear them say.

Let's examine the history of Telecom. It was sold by the Labour Government in 1990 for $4.25 billion. The Government choose to sell the entire business and network to its new shareholders, principally Bell Atlantic (now Verizon) and Ameritech (now AT&T Midwest). The only significant caveat imposed on the new company in the sale by the Government was the Kiwi Share agreement by which the company was required to continue to provide fixed price local line calling across the entire country.

Over the next ten years, Telecom invested significantly in new telecommunications infrastructure in New Zealand including the largest mobile phone network, broadband internet services and establishing Xtra, the country's largest internet service provider. Anyone who remembers what telecommunications services were like under the old Government-owned Post Office telecommunications division and the short-lived, state-owned Telecom, will know that the privately-owned Telecom improved services out of sight, largely eliminated waiting times for new lines, and reduced prices significantly in real terms. Over the same period, competitors to Telecom were established and grew significantly - Clear Communications and Saturn merged into TelstraClear, Vodafone set up and became a major competitor in the mobile market, and a miriad of smaller and specialist telecommunications companies were established and prospered.

In 2001, the Labour Government began its serious assault on the company its predecessor had sold for $4.25 billion with the passing of its Telecommunications Act and the establishment of a Telecommunications Commissioner. This was followed by the 2006 announcement that the Government would require Telecom to "unbundle" its local lines from its other services. This edict, which preceded any legislation by more than six months, knocked more then $2 billion off the price of Telecom shares. Bear in mind that by this stage, the big US telecommunications companies had largely sold out of Telecom and the loss was sustained primarily by "Mom and Pop" investors in New Zealand. The announcement was very poorly handled, being leaked to the media in advance, which exacerbated the loss.

In November 2006, the Labour Government passed its Telecommunications Amendment Bill, which would force Telecom to break itself into three separate companies, with network access separated from the wholesale and retail units. The new act effectively nationalised the Telecom network without compensation for shareholders. The market's assessment of the loss resulting from this expropriation was the more than $2 billion decline in Telecom's share value. Since then, in spite of the prospect of further expropriations, Telecom has continued to invest in New Zealand's telecommunication infrastructure, building the new XT mobile network and upgrading exchanges and circuits to new fibre-based technologies.

So, having sold Telecom to its shareholders for $4.25 billion, the Government has effectively stolen its assets back without recompense, and now the High Court has imposed a fine on the company for using what were its own assets to its financial advantage. Am I the only person who sees something deeply immoral in the Government's actions?

Telecom directors and shareholders face a real dilemma. If they make money, the Government and the courts are going to cane them. And yet the Companies Act requires that the directors "act in the best interests of the company". What on earth are they expected to do? Do the Government and the New Zealand public expect Telecom to be a charity?

I guess that is exactly what people in this country expect. I continually hear this bullshit about corporate "social responsibility" as if that should be the highest goal of any company. What about survival - is that unimportant? What about making money so it can employ people, pay dividends to its investors (including all those "Mom and Pop" investors who are counting on those dividends to pay for their retirement or to send their children to university), and invest in new technology so that New Zealand has a first class telecommunications infrastructure?

Actually, I know the answer to the last part of that question - we don't need Telecom to invest because the Government is going to do it for us through its Ultrafast Broadband initiative. But haven't we proven once before in this country that the Government can't build and manage an efficient telecommunications infrastructure? Bear in mind that the Government has just announced that its sponsored broadband companies will be guaranteed immunity from the anti-competitive oversight of the Commerce Commission. Hang on, I thought that anti-competitive behaviour was the reason for the record High Court fine imposed on Telecom? So anti-competitive oversight should only apply to the nasty people at Telecom, is that what the Government is saying?

Having sold Telecom for a fair price, the Government has come back and plundered the company. The network assets belonged the company and its shareholders. There was competition in the market and any undue advantage (whatever that expression may mean) that Telecom had gained from its ownership of the tails was being eroded by the introduction by all telecommunications companies of fibre cables and wireless services.

The actions against Telecom by successive governments are outright theft. The only fair thing for the Government to do is to compensate Telecom shareholders for their losses through the expropriation. The Government should stop wasting taxpayers money and get out of the telecommunications business completely. The Telecommunications Commissioner is unnecessary and his office should be abolished. The Commerce Act only discourages true competition and should be abolished. Only then might we see New Zealand's telecommunications infrastructure become one of the world's best.

I won't hold my breath.

So what about TV1 and TV2?

The Government has announced it intends turning TVNZ7 into a public service channel leaving TV1 and TV2 to pursue fully commercial ends. Leaving aside the relative merits and political arguments for this move, the change raises an obvious question that broadcasting minister Coleman has failed to address: why would the taxpayer continue to own TV1 and TV2?

If these two channels are to be wholly commercial, the taxpayer has no business or interest in owning them. Presumably the only reason for continuing to own them is political - i.e. the Marxist ideal of the state owning the means of production - and given that the National Government is not meant to be Marxist (at least last time I checked with their manifesto), surely they have an obligation to sell these channels.

2009 - the year NZ decided to join the Third World

As 2009 draws to a close, it is time to reflect on the year in retrospect. It was a year that opened with hope for those of us who believe there is a better alternative to the ever-waxing tide of government regulation and expenditure that we have seen under successive New Zealand governments for the last 15 years. The new National government was elected on a platform of economic growth and prosperity.

Alas, after one year of National, the signs are that this is a conservative (with a small 'c') government that is not prepared to change anything that the previous Labour government put in place and that is prepared to increase the burden of regulation and government interference in the economy through initiatives such as the new emissions trading scheme and increases in accident compensation levies.

The truly alarming news out of this government came late in the year when the Minister of Finance announced that the goal of the 2025 Task Force, to match Australia's GDP per capita by 2025, was "aspirational" and unrealistic. The effect of this is that, for the first time ever in my observation of politics in this country, the government has conceded that New Zealand's future is as a Third World, not a First World, country. This alarming news is made worse by the widespread acceptance of the Finance Minister's view in the mainstream media. Personally, I find this situation very depressing and for the first time in many years I find myself reassessing whether New Zealand will continue to be my home.

I am fortunate in that my family and I have dual citizenship and can live and work anywhere in the European Community as well as in New Zealand. My children are still at school but they are already citizens of the world, having travelled to a number of countries at a young age and having already become fluent in other languages. It is apparent that they will be highly productive citizens of whichever country they eventually settle in and I don't think I am being overly boastful when I say that they are exactly the type of young people that New Zealand needs to retain. But it is difficult to remain loyal to a country that seems intent on squandering its future.

Hopefully 2010 will see the National Government come to its senses and follow through on the platform of economic growth and prosperity on which it was elected. If it does not, it will be betraying not only the electors who put it in power but the future electors of New Zealand like my children.

NZ - a future nation of domestic servants?

It was interesting to hear Bill English's reaction to the 2025 Taskforce's recommendations on policies New Zealand should follow to catch Australia in GDP per capita by 2025. The taskforce was set up by the National Party-led Government as a condition of its 2008 election coalition agreement with ACT. English didn't disagree with the taskforce's recommendations so much because he thought they were likely to fail to meet the objective, rather he dismissed the objective itself. It other words, he said it was unrealistic for NZ to try and catch Australia.

Let us think about what this means for a moment. Australia's economic growth hasn't been spectacular in recent years, in fact, it has been quite modest in comparison with China and some other Asian nations. Australia itself will have its work cut out trying to keep up with its Asian neighbours over the next 15 years. If NZ doesn't even keep pace with Australia, where does that leave us?

I think the answer to this question is obvious. It will leave New Zealand as an increasingly poor country in an increasingly prosperous region. We are already starting to take on the characteristics of a third world nation with low wages and poor infrastructure, and an economy based on commodity exports and low-cost tourism. If the trend continues, New Zealanders in the future will work for Chinese and Malaysian companies as low-cost labour, manufacturing consumer goods or pharmaceuticals; or as domestic servants making the beds, cleaning the toilets and tending the gardens in wealthy Asian homes. We will become a remittance economy with New Zealanders working offshore sending money home to enable unemployed relatives here to survive, just like many Pacific Island economies today.

Is this what we aspire to? According to Bill English it is. Essentially he is saying New Zealand should not try to compete with its neighbours in the region. We should lie down and allow ourselves to be rogered by those who have the fortitude to compete on the world stage.

I have never before heard such a pathetic, defeatist vision for this country. If this is all English and his cronies think the people of this country are capable of, they should all resign immediately.

Hide-Bound Ideas on the ETS

So Rodney Hide is finally stepping up to the mark and criticising the Emissions Trading Scheme. I'm sure the huge volume of e-mails he has had from supporters has jolted his conscience, just like it did with his profligate overseas travel spending.

The Herald reports that Maori Party MP Rahui Katene returned the swipe, beginning her speech by noting it was a joy to work with a party "not tied down in Hide-bound ideas". What he or she (I've really no idea which) means is that it is good to deal with a party (National) that has no principles. How true!

ACC - the alternative welfare system

The only time in recent years that I have had cause to claim ACC was for a particularly severe case of occupational overuse syndrome (known as OOS - what used to be called RSI). I had been spending even more time than usual at the keyboard and had developed such severe pain in my back and shoulders that I couldn't sleep. The physiotherapist I saw pointed out that I could claim ACC for her costs but NOT if the injury had been done at work! If it had been done at the gym, fine, I could claim, but if it had been caused by my work, I couldn't!

This incident brought home to me what a perversion of the original intent of the scheme ACC has become. If I had made up a story about how I was under stress because of some imagined childhood trauma, then I would be covered. If I have a genuine (and genuinely debilitating, I can assure you) injury from work, I'm not.
It certainly bears no resemblence to the accident and workplace injury insurance scheme it was conceived to be.

The future liability for current claims is $24 billion. That is $6,000 for every man, women and child in New Zealand. I certainly have no claim on that $24 billion, neither does any member of my family. I have no friends or associates that are off work on ACC. So where are these claims coming from? Well, in the main they aren't coming from the working population of New Zealand. They're coming disproportionately from those who would otherwise receive welfare benefits. So John Key is right, for once. ACC has become an extension of the welfare state - the safety net below the safety net.

We have to start weaning people off this profligate scheme. It has to be fair and reasonable if it is to survive, and that means fair to those who pay the bill - the workers, employers and taxpayers of New Zealand. The right answer, of course, is to abolish and/or privatise it. Jim Bolger's government had the balls to do that. It remains to be seen whether this National Government has any at all.