Tuesday, August 31, 2010

Uncovering The Truth About The "Bailout"

I wrote this post in response to the mass of uninformed and confused commentary spreading like a virus across the blogosphere about the collape of South Canterbury Finance. I ain’t no Fancy-Dan finance whizz, but some things are pretty clear, nevertheless.

Here are seven of the things people are saying about the SCF mess that I think are wrong. 

This is a government bailout.

Some people appear not to understand the difference between a bailout and a guarantee scheme, and happily conflate the two. This is not a “bailout” in the way institutions in the US that were “too big to fail” were rescued by huge amounts of government largesse. It is not “corporate welfare”, except to the extent that some of the retail depositors will be companies. The owners of SCF will get nothing from this.

The retail guarantee scheme should never have been extended to finance companies

Had it not been extended to cover all significant institutions where money was invested, almost every finance company would have collapsed in 2008. Sure, many of them collapsed anyway, but the effects of all of them falling over overnight, as investors frantically tried to pull their money out, would have been potentially catastrophic.

How come the Government can instantly find $1.6 billion to pay a few thousand investors when it says it can't afford pay rises for teachers? It's a have!

The Government has contractual obligations under the retail deposit guarantee scheme. It is not choosing to pay SCF; it is fulfilling an obligation. The Government had set aside in its books about $900 million to cover expected liabilities under the scheme, so it's not as if all the money has been suddenly found from nowhere.

And, yes, teachers deserve more money, but that's not a related issue. 

The owners of SCF should be made to pay, not the taxpayer

They are paying a heavy price. They will lose everything not covered by the deposit scheme. The Crown will be a first secured creditor over the company, meaning it will take out what it is owed under the guarantee before the owners receive a cent. Given there is expected to be a shortfall of $600 million or so, that means everything Mr Hubbard has put into SCF is likely to be gone forever. 

This is all the Government’s fault

Only indirectly, in the sense that decades of politicians worshipping at the altar of deregulation has left us in a situation where our financial and capital markets were operating like the Wild West. But that’s where the blame should end. This was a business failure, and the people who are to blame are those who ran the business into the ground. Those who say the government caused this failure by its SFO investigation and statutory management of Hubbard are ignoring the fact that several months ago Hubbard was effectively sidelined from the business by his own board. It appears the board saw the damage he was causing and tried to get rid of him, too late. This hasn’t just happened – it’s been bubbling away for months.

In fact, as much as I would love to, I can't fault the Government on its response to the crisis. Labour's attempt to make political mileage out of this is pathetic. 

This latest failure shows capitalism doesn’t work

No, it shows that unregulated capitalism doesn’t work (note to ACT Party: Don’t you look like fools now?). If we had a decent set of financial disclosure regulations, and a regulatory watchdog with some teeth, maybe some of these rotten companies would not have got so big before failing. 

The retail deposit scheme was set up to favour the rich – who happen to mostly vote National

No. Dr Cullen set the scheme up. Hardly a National man. He did so to restore confidence in our financial markets, and to avoid a catastrophic collapse that would have made Iceland seem an attractive place to do business by comparison.


Discuss.

Lousy Billboard, Lousy Candidate

I've been trying to work out who to vote for in the upcoming local body elections.

Being an Aucklander, I have only two realistic options for mayor: Banks or Brown. As little as Brown inspires me, I am very much in the "anyone but Banks" camp. This was reinforced to me as I watched the debate between Banks and Brown on Campbell Live last night. Neither candidate impressed me, and both seemed more interested in flinging dung at each other.

This may sound like an odd objection, but both men seem to want the job rather too much. Banks definitely lost it for me, though, when he accused Brown of trying to divide the city by race.

Locally, I have a few decisions to make about which candidates I've never heard of to vote for. Thankfully today's Herald made my job just a bit easier.
A citizenship speech by Waitakere City councillor Ross Dallow - father of TV One newsreader Simon Dallow - has outraged a new New Zealander.
The Filipino man says he was incensed by remarks he claims Mr Dallow made during his citizenship ceremony in Henderson on Friday.

The man, who did not wish to be named, told the Herald Mr Dallow described kidnapping as an Asian crime, and blamed immigrants for increasing rates of drug manufacture.

He also described changing immigration demographics as the "browning" of the country, the man said.
And apparently Mr Dallow has form for these sorts of outbursts:
But Waitakere Mayor Bob Harvey was unimpressed when told of Mr Dallow's speech, and said council staff had previously expressed concerns at the tone of his citizenship speeches.
"You bet your bloody life they have, at his tone and the manner.

"Citizenship ceremonies, which are a celebration, have no place for lectures about race and crime.

"It is a happy occasion ... Unfortunately, Mr Dallow sometimes speaks his mind, and it does often cause offence."

Asked if he thought Mr Dallow was well intentioned, Mayor Harvey said, "No, I don't."
Dallow's election billboards are also hideous - a bizarre blue and red check pattern that surrounds his name. Now I learn he is an ex-copper it kind of makes sense.

I told my wife as we were in the car last weekend that I would never vote for someone responsible for such billboard abominations. I now have another reason not to vote for the guy.

Monday, August 30, 2010

Super Rich PM Lectures Teachers On Being Disconnected

From the Herald:
Secondary teachers' plans to go on strike next month show they disconnected from the real world, Prime Minister John Key says.
And:
Mr Key was scathing about the planned strike when asked at his post-Cabinet press conference this afternoon.
"Personally I think it's very disappointing and I think it shows you how disconnected they are from the real world," he said.
Would that be the man who made millions playing the markets, moving cash from point A to point B, who leads a party dominated by middle-aged, conservative, comfortably-off white men, and whose wealth ranks him amongst the super-rich of this country?

Let's compare Key with those disconnected teachers. Teaching pays okay, but you certainly wouldn't do it for the money. The vast majority of teachers have mortgages and struggle to pay the bills. And forget the perks: the holidays and so forth. Teachers put in a lot of overtime during the school term with marking, assessments, parent-teacher interviews and reports.

Teachers are also at the coalface, and have to deal with a lot of crap in the classroom from kids. Some of this is the result of years of poor government policy: broken crime-riddled homes, and kids who are behaviourally "challenged". No way would I want to be a teacher*.

When was the last time our "connected" PM worried about his phone bill? Or how he would afford the car rego? Or the grocery bill?

Mr Key, teachers do worry about being disconnected. It's what happens when you can't afford to pay your power bill.  Not that you would know.

* I am married to a teacher. Glad she does it and not me. Wouldn't swap.

An Understanding Wife


I do hear these former city-trader-banker types are up for anything, but good on his wife for being an adventurous sort.

If South Canterbury Finance Fails...

... I predict that many of Alan Hubbard's supporters will turn on him, like sharks who've scented the blood of one of their own. He may be a well-meaning old gentleman, but nothing is quite as educational as the pain of losing one's life-savings.

... we must remember to blame the Government. They acted too slowly. Or did they act too fast in putting Hubbard into statutory management? Does it matter? All this market stuff is confusificating me. But John Key is personally responsible.

... we should ask Rodney Hide whether the investors of SCF will agree with him that our markets are over-regulated.

... we should ask Rodney Hide to provide his answer through a megaphone while walking down the main street of Timaru.

... Auckland will be blamed. I'm not sure how or why, but it will.

... we will probably thank the gods our biggest banks are Australian-owned.

How Far Does This Go?

The latest news of corruption in cricket will horrify most followers of the game, even if they may not be especially surprised to learn a team from the Indian subcontinent is again at the centre of allegations.

It's getting to the stage where you just can't rely on any result. And if the bookies haven't fixed the actual result of something, they're probably fiddling in some way. For example, nobody is seriously claiming the result of the Pakistan-England test was fixed. Instead, a certain number of deliveries in the game (at least three) were allegedly "bought" by bookies.

When I look back at some of the strange things that have gone on, I realise the bookmakers and betting syndicates may have been doing this for years.

You can see their influence as early as 326BC, when Alexander the Great faced the Hindu king Porus in the Battle of the Hydaspes River. Alexander was a legendary general, but there's no way he won that battle fair and square. Are we seriously meant to believe he sneaked over the river and outflanked the enemy without being detected? Either Porus was an idiot, or he took a dive. You decide. But isn't it somewhat convenient that after the battle Alexander allowed him to keep his title and lands, in return for his loyalty?

Some people have argued Alexander was the greatest military leader who ever lived. But I'll bet historians and archaeologists one day discover he had a long baggage train of Indian bookmakers following his army.

Another ancient battle I could never fathom was Cannae, in 216BC. There you had a vast and powerful Roman army (up to 80,000, depending on which ancient sources you believe), against maybe less than half that number led by Hannibal. In the end Hannibal's army outflanked the Romans, drove off their cavalry, and then annihilated them. Hannibal's tactics in this battle were either pure genius, or the whole thing was fixed. I'm just not sure why the Romans agreed to go along with it, because most of them were slaughtered. Mind you, one of the two Roman generals managed to escape, despite what must have been some pretty heavy bags. That gold would have weighed a tonne.

Hannibal's army was composed of a multitude of different races: Iberians, Africans, Gauls and Italians to name but a few. It would have been quite easy for a few bookies from the east to slip in unnoticed.

And what about the papal elections? I'm not saying the election of the current bloke was a complete fraud, although there have been some shock selections in the past. But I bet there would have been some serious money placed on when the white smoke would rise from the Sistine Chapel.

Talking of matters religious, how about that Jesus fellow? Gets nailed to a cross then turns up a few days later, apparently alive and well. Is anyone else thinking a few Roman soldiers might have been paid to look the other way? I understand that back in the day 30 pieces of silver was the going rate for selling someone out, but an operation like this would have been much more expensive, because of the number of people involved.

So this has been going on for years. Though if you think the cancer hasn't spread to this part of the world, think again. Our politicians continue to make decisions that defy all logic or reason. There is even a political party in Government whose policies seems to be designed to achieve the exact opposite of what they publicly claim. Can our politicians really be this inept? Or is something else going on? And why hasn't this been exposed by Ian Wishart? Or is he one of them? That would explain a lot of things.

Saturday, August 28, 2010

Politicians, Like, So Totally Think New Medal Of Honour Game Sucks

Defence Minister Wayne Mapp has blasted a new electronic game that allows players to become Taliban insurgents.

The new Medal of Honour game is part of a popular series of first person "shooter" games.

"Dude, this game is, like, so totally lame," said Mapp yesterday.

"I played these terrorist guys and it was so completely f**ked up. I mean, like, if I really wanted to bomb that many innocent civilians I would so totally get one of those unmanned US drones and bomb the f**k out of some wedding party.

"Playing the Taliban sucks arse, dude. Their weapons are totally lame and the Yanks seem to have all the cool shit."

The game has also caused controversy in the United Kingdom. British Defence Secretary Liam Fox told the BBC: "This is an utterly stupid game. I am outraged.

"I, like, so totally preferred the Medal of Honour D-Day game. I love being the Nazis, blasting the f**k out of the Yanks as they land on Omaha Beach. That is some f**king awesome slaughter, I tell you, mowing them down in piles as they attempt to liberate Europe from the horrors of Nazism. Bring 'em on!"

The Next Susan Boyle?

The Herald has an alarming story:
Manukau's singing, rapping mayor, Len Brown, wants to sing the national anthem at Eden Park during the Rugby World Cup.

What's more, Mr Brown plans to invite Dunedin Mayor Peter Chin, who has sung the anthem at two test matches at Carisbrook, to join him in a duet.

"I'm known as the singing mayor of Manukau and I want to be the singing mayor of Auckland," Mr Brown said.

"I'd love the opportunity on behalf of the people of Auckland to sing in baritone alongside Peter Chin's excellent voice a duet from the south and the north. Wouldn't that be something?"
It sure would be something. That something would be me emigrating.
The popular Dunedin mayor, also a baritone, said it had been a huge honour to sing before 30,000 rugby fans on such notable occasions at Carisbrook and put the city on the map.

Unfortunately, both times the All Blacks lost, to the Springboks and France, he said.
Great. At least we'll have someone else to blame when we crash out of the World Cup.
International stars are a feature of major sporting events.

Bruce Springsteen performed at the 2009 Super Bowl final in Florida and controversial American singer R Kelly performed at this year's Fifa World Cup in South Africa.
I'm not convinced Len Brown qualifies as an international star. I've not heard him sing, though. Is he as good as Banksie? Maybe they could have a sing-off or rap duel to decide the Auckland mayoralty.

Friday, August 27, 2010

The Rodney And Heather Story: Episode Two

You may recall this story I posted a week or two ago about an idea I had for a TV drama.

I left the story with Heather plotting her revenge. At that time I didn’t know what Episode Two might look like.

But since then I’ve developed the plot some more. Let me share it with you.

You’ll recall Rodney’s just kicked Heather out of the house. Meanwhile, at home, everyone hopes things will to go back to normal. The good son John is pleased as punch that his interfering mother is out of the picture. Smelly old lodger David is in the corner of the lounge with a whisky bottle, mumbling incoherently about how he'll get back at various people who've done him wrong.

Meanwhile, Heather’s father Roger looks on in disapproval. In a moment of self-reflection he wonders if he has been instrumental in creating this selfish, narcissistic bunch. I was always about looking after number one, muses Roger. Can I be surprised that they followed my example?

Rodney tries to bury himself in his work. But it’s just impossible to be in the same room with any of his workmates. They all know what has happened. Some of them have been behaving coldly towards him, and even appear to be relishing the pain and humiliation he is suffering.  Rodney begins to realise how well-liked Heather was by many of his workmates. It occurs to Rodney that he has made a terrible mistake, and he wonders what to do, all the while hoping the whole thing will blow over. Perhaps there will be a crisis at work, he dares to hope. One of the managers might fall into one of the machines and come out the other end nicely bottled and packaged. That would move the conversation topic in another direction.

Rodney sits at his desk, mooching. He can't focus on all the paperwork that has been piling up on his desk. So he stares out the window, remembering better times, before they had John, and before that awful tramp David moved in to stink the place out. His boss, Joe, arrives frowning. He's heard rumours and wants to know the truth. Rodney decides it’s easier just to say Heather’s run off with another man. There’s this guy at Heather’s work called Simon, and Rodney knows she and Simon work closely together. Rodney blames Simon for the falling out. Joe says it's not a good look for one of his employees to kick his wife out of the house, and that it might affect sales.

Sales, Rodney sighs. It's always about sales. He must continue to play the game if he wants to keep his senior role in the firm. So he assures Joe nobody was kicked out, and that Heather has gone away for a fortnight to clear her head. We will sort all this out when she's had time to think, Rodney says.

The following day Rodney meets Joe in the lift. When asked whether he’s heard from Heather he says no, and then says he expects she’s thinking long and hard about whether she has any further place in the family. She’s let a lot of people down, Rodney tells Joe.

That evening Rodney goes to a work function. It is a dress-up event, and all the firm's big clients will be there. The annual event had become one of the social highlights of the year for the now-estranged couple. Heather had even bought a special gown just for the occasion. Rodney mutters to himself how wasteful that expenditure was, because being a mean and spiteful man he hates wastage and cannot see why anyone should want to waste cash on a bit of frill and fluff.

Rodney goes reluctantly. He doesn’t want to be at the event, but if he doesn't turn up everyone will talk, and he’ll be damned if any hussy is going to make an idiot of him. He’ll go to the function and let everyone see just how unaffected he is by the break-up with Heather.

But there she is in the doorway of the ballroom, smiling at him and winking. He almost faints. He can see everyone’s eyes are upon him. What should he do? The witch is here to make a fool of him!

Straightening his back and breathing in, Rodney advances forward, kissing her on the cheek. “Hello dear,” he says in a voice loud enough so everyone can hear him. “I’m glad you made it on time. I was worried you’d be held up in the traffic.”

“No dear,” Heather replies with a serene smile. “The traffic was just fine. Shall we go in?” She puts her hand in his and they go inside.

The evening is excruciatingly painful for both of them. They remain physically proximate, but they do so under sufferance. Finally, the night ends and they jump in a taxi together. She tells the driver to take her to her hotel.

“I hope you enjoyed that little charade”, Rodney sneers at her. He is sure everyone saw through the facade, and feels humiliated.

She replies by asking why he thought she would always be submissive and do as she was told. She knows he’s a bully, but the best way to handle a bully is to stand up to him. And that’s just what I’m doing, she says.

He asks her why she returned. She explains that she has too much invested in the marriage to just walk away. Rodney may well be an unpleasant little man, but the house and assets are hers too. She also enjoys attending the society functions Rodney takes her to, and the status they give her.

We shall simply have to come to an arrangement, she informs him. I will be the good and loyal wife, and you will welcome me back with open arms.

He tells her that nobody will for a moment believe all is well again. Let them gossip, she says. We have had difficulties in our marriage but we are working on them now and are committed to each other. What could be more 21st century than that?

Rodney knows he must swallow his pride if he is to keep his position at work. He agrees to her proposal, but with reservations. She smiles with the satisfaction of a woman who has won her battle. As she exits the taxi outside the hotel she bids him goodnight.

In her room she holds a wineglass. Simon fills it and sits with her. She laughs.

“Such a silly man,” she says. “He'll still get the sack. He’s been under-performing for months. Then I shall turf him out of the house and take back my place as head of the family.”

Simon wonders how she can be so confident of success. Why wait until Rodney is fired? She should get a good divorce lawyer now and take him to the cleaners. He tells her this.

No, she tells him. With Rodney power is everything. His job gives him status, and that status gives him power. When he is fired he will deflate like a popped balloon. Then he will sign everything over to me.

Give it a year, 18 months at most, and Rodney will be out on the street. That treacherous whelp John can join him too, and smelly old David will be gone. I shall have to fumigate the house, but it will be worth it

Then Dad and I will be able to settle down and get back to normal living.

Simon wonders what part he might play in the drama to come. He is attracted to the charms and wiles of this headstrong and unpredictable woman.

But Heather has plans for Simon. He does not notice as she slips a tablet into his wineglass. The last thing he remembers as he tumbles to the ground and stares at the ceiling is the face of his beloved smirking over him.

Labour Remembers Not To Endorse The SST

Check out this post by Labour MP Clayton Cosgrove on Red Alert:
Labour believes that the Parliament genuinely is a people’s parliament. Even if people have differing views.So when Labour was asked (by the National Party on behalf of the Speaker) whether we objected to the Sensible Sentencing Trust holding a conference in the parliament, we said no we don’t object. After all the parliament is actually owned by the people.

It is our understanding that all the major parties were asked.

That’s it. The Labour Party was never approached to co-host. I was never approached or asked if my name could appear on the invitation. This happened without my knowledge or my permission.
Perhaps The Standard should have checked.
Cosgrove is responding to a post on The Standard critical of Labour's associations with the Sensible Sentencing Trust (I also wrote a critical post, but am led to believe that the audience for this blog may be slightly smaller than The Standard's). A media report indicated the conference was being hosted by Labour. It has taken until now for anyone in Labour to deny this.

It's a pity it has taken until now for this to be cleared up. A cynic might conclude that Labour either wasn't fussed by the association with Garth McVicar and his nutjob group, or that it was too afraid to break rank with the law and order mob.

I'm sure there's a reason why this wasn't mentioned during the conference. Wouldn't want to give old Garth one of those juicy soundbites about out-of-touch politicians, huh?

Now this has been cleared up, I await Clayton Cosgrove's denunciation of the Sensible Sentencing Trust's use of Labour's name to promote its organisation.

But a question: how long should I wait?

Pity Whanganui

What is it about being a mayoral candidate for Whanganui? Is it obligatory to be a nasty piece of work?

In the aftermath of the various accusations being thrown about between Michael Laws and mayoral candidate Jevan Goulter, it turns out that Goulter leaked to the media emails between Laws and a former P-addict.

If that is not enough, a quick Google search will give Whanganui voters all the reasons they need not to vote for him. 

Goulter is absurdly young (21), and clearly lacks both sense and maturity. He is a child trying to play an adult's game, and is making a fool of himself. His muck-throwing makes him no better than the man he has targeted.

There is a saying that people get the politicians they deserve. But I can't believe any town really deserves a clown like Goulter, even as a mayoral candidate.

Thursday, August 26, 2010

D-Day vs Band Of Brothers

I am a bit of a war junkie when it comes to my reading choices. I've always had a fascination with history, and being a typical male the parts of history that especially interest me are the bits where people are stabbing, skewering, or blowing up others.  That probably makes me a truly awful person, but I can assure you I don't revel in tales of misery. Quite the reverse, in fact. The more I read, the more appalled I become at the way warfare completely dehumanises people.

I've just finished reading two quite popular historical works on the Western Front in World War Two, from 1944 to 1945. The first, D-Day by Antony Beevor, tells the story from the Normandy landings to the capture of Paris, examining events from both sides. The second, Band of Brothers, by Stephen E Ambrose, is a history of Easy Company, a unit within the US 101st Airborne Division. You may have seen the Stephen Spielberg miniseries based on Ambrose's book, but if you haven't it's worth a look.

I find myself attracted to Beevor's works because they do not limit themselves to the movement of units and the strategies of generals. Beevor's books are so popular because they bring to life the experiences of the foot-soldiers and civilians caught up in the middle of war. They do so without glamorising warfare. In fact, such are the graphic descriptions of battle and death that it is impossible to feel anything but horror at modern, industrialised warfare and its callous disregard for human life. His books Stalingrad and Berlin are epic tales of suffering, atrocities and villainy on all sides. They are also deeply depressing, for they are histories rather than fiction. 

Band of Brothers tells the story of Easy Company from 1942 to 1945. Easy Company was involved in the D-Day landings, dropping behind enemy lines on Utah Beach, was engaged in fierce fighting in Normandy around Carentan, and was involved in the desperate defence of Bastogne during the Battle of the Bulge from December 1944 to January 1945. During that battle the 101st withstood a huge German offensive, effectively stopping the German army in its tracks. Finally, towards the end of the war, they had the distinction of capturing Hitler's Eagle's Nest (though this claim has been disputed).

The men of Easy Company are portrayed as dedicated, brave and heroic, men to be admired and honoured. And yet more than a few German prisoners end up dead along the way, and it's clear that some of the men seem to take rather too much joy in killing the enemy. By the end of the book I was convinced that almost all of the men of Easy Company were indeed brave, and capable of deeds of courage most of us could not imagine. But were they heroes? Ambrose would have us believe they were.

Beevor’s book D-Day paints a less than rosy picture of the Allied invasion of Normandy. The book does not attempt to disguise or justify the fact that Allied soldiers routinely shot German prisoners, usually automatically if they were SS. And the bombing of many French cities by the Allies, including Caen, killed thousands of civilians. A necessary evil, perhaps, some will argue. And I don’t intend to construct an argument that the Allies were in any way equally as guilty as the Germans, whose wilful execution of civilians and utter callous disregard for their own men put them in a league of their own in terms of sheer awfulness.

I haven’t read any other works by Ambrose, but his portrayal of heroic men fighting against the odds doesn’t really fit well with the post-modern view of history. That’s not to say war can never be justified, or that all sides in a battle are as bad as each other. But an account that paints the US as always being the good guys fails to explain the moral compromises people engaged in war are forced to make, or how they live with those decisions. Amborse succeeds in dehumanising the enemy. They are always just "the Germans".

That, I think, is why I am drawn to books about war. Good books, that is. A decent book will force us to think hard about the terrible things people are capable of, and will also make us realise that war is a truly evil thing, and that we must do everything humanly possible to avoid it.

But it can get one down, all this death. I think my next book will be something suitably light and fluffy.

They Came From Outer Space

Does anyone else see the resemblance?

National and Sensible Sentencing Trust Have Love-In

It's telling that National Party politicians have been lining up to speak at the Sensible Sentencing Trust's conference, and that the conference is being held in Parliament's Banquet Hall.

It shows just how in bed National and the SST are (if there ever was any doubt).

We're talking about National's big guns: John Key, Simon Power and Judith Collins.

The Herald's editorial is critical of the trio:
It is a feather in any group's cap when not only the Prime Minister but the Justice Minister and the Police Minister queue up to address it.

A stamp of importance is conferred and the credibility of its viewpoint is enhanced.

So it was yesterday when John Key, Simon Power and Judith Collins spoke to a Sensible Sentencing Trust conference on victims' rights in Parliament's Banquet Hall.

All emphasised, quite reasonably, that the trust represents an important voice. But they also gave every impression of wishing to heed its policies.

Never mind that many of these are too extreme and too outmoded to find their way into any coherent justice reform package.

This all smacked of politicians who are too willing not only to respond to public annoyance, but to promote it. Whether that sentiment is justified is too often irrelevant.
And:
Before gaining power, John Key enunciated a compelling law and order approach that focused on stopping youngsters embarking on criminal careers. 
It seemed he might be ready to eschew the punitive measures that are so often part and parcel of political posturing, recognise the complexity of the problem, and that there were no simplistic solutions.

A National Government might, it seemed, work with experts and the weight of evidence to win over the public to policies that offered a better prospect of correction and safety.

Now, however, it is busy tipping its hat to old-school approaches that have been in the ascendancy for years but palpably have not worked.
That is quite damning stuff from a newspaper that has itself done so much to promote the view that we need to "get tough" on crime.

The SST website claims that Labour and ACT are also sharing conference hosting duties. You'd expect that of ACT: their man David Garrett is an MP. But if there was ever a time to put some distance between Labour and the loony policies of the SST, now would have been it.

Sadly, Labour lacks the courage to stand up and call "bullshit" on the failed "hang 'em high" policies of the law and order mob.

It is particularly disheartening to see Simon Power acting like the SST's poodle. I dared to believe for a while that he might be one of National's better ministers. But he seems to be going out of his way to aggravate the judiciary and legal profession, pursue nonsensical policies, and react aggressively and knee-jerkingly whenever issues or difficulties are identified within the legal system.

Power is a relatively young minister, and appears to have forgotten that our legal system has been developed slowly and carefully over the course of centuries. Power seems to want to change everything urgently. He needs to slow down and consult more.

There's a good reason why lawyers don't like sudden radical change. If we don't pursue reform in a calm and considered way we risk creating more injustices.

Wednesday, August 25, 2010

Sonny-Bill Fit To Play - in 2031

Rugby superstar Sonny-Bill Williams is set to make his debut for Canterbury next week.

Canterbury coach Colin Slade said the niggling injury that has kept the exciting player on the sidelines for so long has almost healed.

"Last week he wasn't there, but this week he's ninety-five per cent fit.

"But we decided not to risk him. We just want to give him another week."

Williams was recruited by the Canterbury team twenty-one years ago, but has been sidelined by a succession of injuries and illnesses since that time.

Williams told reporters he was "fizzing" and ready to put on the red and black jersey for the first time. But he was also prepared to be patient.

"I know my time will come," Williams said.

But time is running out for the 46 year old sensation. Williams has made no secret of the fact that his main goal in returning to New Zealand two decades ago was to be an All Black. However, the All Black selectors are due to name their team to tour the Northern Hemisphere next month, and may be reluctant to pick Williams on reputation alone.

All Blacks coach Aaron Cruden has spoken in the past about his admiration for Williams' strength and power as a rugby league player.

On the other hand, Cruden will be mindful of Williams' history of injuries and illnesses. Williams' most recent attack of gout will be weighing heavily on the coach's mind.

But Williams dismisses concerns that he is fragile, injury-prone, slow, old and overweight.

"I've just got to stay focused on the goal ahead. It may take me another twenty years, but if that's what it takes to play for the All Blacks, then so be it.

"And if they don't want me I've got an offer to play for England."

Construction Worker Finally Discovers Why He's Been Agreeing With Michael Laws


Have you ever had one of those shocking mornings after a particular rowdy New Years?

From the Herald:
A man lived for several years totally unaware a bullet was lodged in his head after a drunken New Year's Eve night out.

It wasn't until the Polish construction worker, who lives in Germany, noticed a cyst on his head and went to hospital that the truth was revealed - x-rays showed there was a 5.6mm 22-calibre bullet lodged in the 35-year-old's scalp.

The man couldn't quite remember whether it was 2004 or 2005, but did recall feeling a forceful blow to the back of his head around midnight as he celebrated New Year's Eve in the German city of Herne, police spokesman Volker Schutte told German English-language newspaper The Local.

"He told us he remembered having a sore head, but that he wasn't really one for going to the doctor," he said.
Like most people, I've not had the opportunity to experience for myself true bullet-in-head pain, so I can't be altogether certain how I'd react if someone shot me in the head.

But, assuming I survived the experience with some parts of my frontal lobe intact, I expect I might think: "gosh, that doesn't feel so good. Damn, that hurts! Well what do you know, there's a hole in my head! I'd better get someone to look at that. It could be nasty."
While police admit the chances of finding the culprit are not great, [Police spokesman] Mr Schutte said the incident may serve as a warning to others.
"Our next pre-New Year's Eve safety campaign will now have an argument for telling people to leave their pistols in the gun safe because they'll see what kind of damage can be done," he told the paper.
I think a New Years safety campaign is a good idea. We often forget that alcohol and guns don't mix. Who hasn't found themselves a bit squiffy, picked up the nearest handgun and started plugging a few rounds into the closest crowd? It's become such a temptation that nowadays when I go out for a big blowout my wife makes me leave all my firearms behind. Well most of them. She lets me keep the grenades.

This unfortunate tale shows just how weird things can get when you drink. So next time you have a big night, wake up with an awful hangover and are too sick to work, ring the boss and tell him someone must have shot you*.

* Disclaimer: I’m not an employment lawyer. You’d have to be a total dick to follow this advice.

If You Needed Another Reason Not To Trust ACT


From the Herald.

How many other ACT MPs are there that we don't know about?

And I thought ACT stood for transparency and openness.

I bet they suppress this, and that before the morning's out this article either disappears or is heavily edited.

But the truth will always come out in the end!

Set Up To Fail

So we now have a working group to look at ways of boosting our poor levels of savings.

Except that some of the biggest issues are off the table. The working group won't be allowed to look at changes to NZ Super, nor will it be allowed to consider a capital gains tax. It appears our government has ruled these out forever (using much more emphatic language than the language used when asked about asset sales).

Bill English also has a message for the working group: don't bother coming up with any ideas that will cost money.

Our failure to save is one of the reasons why we're in a pickle. We have dreadful levels of private debt, because we're addicted to mortgages and consumer credit. A bit of rejigging and tweaking is not going to fix the problem.

Terms of reference as knobbling as these tell us that the government has already decided it doesn't plan to do anything radical or visionary. A tinker here and a slight adjustment there, and everything will be fine.

Except it won't. Long term we're f**ked as a nation unless we grow our productivity. We can't do that unless we reduce levels of debt, and grow our savings and investment levels.

This working group has been set up to fail.

A Holy Life: St John Of Aotearoa

Check out this hagiography of our Prime Minister from Bloomberg, published in the Herald.

(Warning: not suitable if you've just eaten)

Tuesday, August 24, 2010

Copyright Troll Sues Bloggers And Website Owners

When people in the intellectual property industry talk about trolling they’re usually referring to patent trolls. A patent troll is a company that appears to have no purpose other than to sue others for patent infringement. The typical patent troll creates nothing, and the only people it employs are lawyers. Most people in the IP world have a negative view of patent trolls, and regard them as an unavoidable evil. If we are to have a patent system, there will always be those who try to use the bundle of rights given by a granted patent to screw over others. That’s just the way the world works.

Patent trolling is big business, especially in the US, where courts have the ability to award triple damages for patent infringement. But now a new breed of trolls is appearing: the copyright troll. Wired reports on efforts by Nevada-based company, Righthaven, to sue bloggers and website owners who have reposted newspaper articles without permission from the copyright owner.

This is one of those “only in the US” stories, because US copyright laws give copyright owners the ability to claim “statutory damages” of up to US$150,000 for copyright infringement, without the need to show actual harm or damage.

Righthaven has been in existence for only a few months, but has already filed 80 lawsuits. Its business model works like this:
  • locate an article from the Las Vegas Review-Journal newspaper that has been posted on a blogsite or website without permission
  • acquire the copyright in the article from the Las Vegas Review-Journal. This is usually done after the potential infringement is discovered, though in some cases the copyright may have been assigned beforehand
  • then sue the blogger or site owner for copyright infringement and demand an extravagant amount in statutory damages
  • settle with the terrified blogger or site owner for a lesser amount (thus avoiding legal scrutiny of its potentially flimsy claim), then share the spoils with Stephens Media, the owner of the Las Vegas Review-Journal.
As a short term tactic it might just work. If you terrorise enough people into settling you might be able to make a killing.

But there are a few problems with this business model.

For starters, it is causing a backlash against Stephens Media, the owner of the Las Vegas Review-Journal. The Blogger News Network reports:
Righthaven has figured out how to monetize the blogosphere, and Stephens Media has figured out how to extract a few more bucks from their newspaper holdings. For now, at least – until bloggers and news aggregate sites begin acting on the principle that any content in any Stephens Media newspapers is about as toxic as radioactive sewer sludge. While a fair number of bloggers and websites have paid up just to make it all go away, others are fighting back by either ‘Righthaven-proofing’ their sites, or blacklisting Stephens Media through their site-posting rules. There are even Firefox and Chrome plug-ins to automatically exclude Stephens Media from your internet browser. Righthaven and Stephens Media may perhaps gain in the short run, but prospects for long-term gain seem pretty iffy.
Maybe Stephens Media has already decided the newspaper is dead as a business model, because its short term gain may lead to long term extinction. A business model that requires you to sue your customers can’t last forever, because you soon won’t have any.

The trollish behavior of Righthaven has also incensed a number of people within the legal fraternity, and a number of legal defences are being formulated in reaction to the infringement claims. These defences include:
  • the argument that Righthaven didn’t own the copyright at the time of the alleged infringement. I’m not sure how strong this defence is under US law. Under New Zealand law when you take an assignment of copyright you would also normally take an assignment of all rights of action for any infringements arising before the date of the assignment
  • potential fair use arguments. Fair use is the doctrine that allows copyright material to be used for the purposes of commentary, criticism, news reporting, research, teaching or scholarship. We have a similar provision under our copyright laws (section 42 of the Copyright Act 1994), though our “fair dealing” exceptions to copyright infringement are not generally as broad as those in the US
  • an implied licence defence. By failing to limit the ability of users to copy and paste text by technical means, and by encouraging sharing of its articles via various social media sites, the newspaper has given an implied licence to people to use, copy and share the material
  • the innocent infringement defence. In some cases material has been posted by third parties in comments sections of blogs and sites, and bloggers and site owners have argued they cannot be held responsible for such actions. Such defences would certainly have an impact on the potential damages that might be awarded, though they will not change the fact that an infringement is still an infringement.
Like I said, this is an “only in the US” situation. It’s not that a newspaper would never sue a blogger or site owner in New Zealand. But the idea of doing so as a business model to gather revenue would not work here, because we don’t have a statutory damages regime.

There might still be good reasons for a copyright owner to want to sue a blogger or site owner for copyright infringement (e.g. to prevent reputational damage), but in most cases the plaintiff isn’t going to make a killing, and will probably be more interested in stopping the use, rather than profiting from it. In most cases a cease and desist letter will do the job (provided it is based on sound legal principles).

Also, much of the typical copy and paste stuff you see on blogsites here (including this one) is permitted under our copyright laws. Fair dealing for the purposes of commentary, criticism or news reporting is a defence to copyright infringement, even if the exact parameters of the “fair dealing” concept aren’t always clear.

(Hat tip: IP Biz blog)

Killer Fungus Spreads to Humans

Medical experts fear that a fungus that controls ants and turns them into zombies may have spread to humans.

As reported recently by The Guardian, scientists have discovered a fungus that appears to turn carpenter ants (Camponotus leonardi) into zombies.

The fungus latches onto the ants as they cross the forest floor. It grows inside the ants and releases chemicals that take control of their brains, leading some of the ants to wander away to find fresh leaves, while others fall from their tree-top havens to leaves closer to the ground.

The Guardian describes the last stages of the infected ants’ lives:
The final stage of the parasitic death sentence is the most macabre. In their last hours, infected ants move towards the underside of the leaf they are on and lock their mandibles in a "death grip" around the central vein, immobilising themselves and locking the fungus in position.
Once the ant is dead, the fungus sprouts from its head, producing a pod of spores that can infect other ants.

Until recently it had been thought that the brain-altering and eventually fatal effects of this fungus were to be found only in carpenter ants.

Alarmingly, however, it appears that the fungus has mutated and is now affecting humans.

Experts noticed last week that, after a lengthy period of seemingly irrational and contradictory statements and policy positions, the five members of the ACT caucus begin to display signs of the terrible illness.

Some of those signs indicate that the disease may be in its final stages.

“The symptoms were there all along,” said Francis Glodwing, an entomologist and specialist in ant species. “Some of the caucus members have been acting weirdly for quite a few years. But we just assumed they were a bunch of regular nutjobs, and not actually infected."


Mr Glodwing said it now appears the fungus can live for years inside the human brain before killing the host.

“In the case of Roger Douglas, there were signs over twenty years ago that his brain wasn’t functioning properly. That’s when the first zombie-like symptoms may have begun to manifest themselves. His leaving the Labour Party to obsessively pursue laughable and nonsensical economic policies can be compared with the infected carpenter ant abandoning its colony and locking its mandibles into a leaf in a different part of the tree.

“I wish we had seen the signs earlier.”

Doctors now hold grave fears for the five members of the ACT caucus. Their behaviour has become increasingly inexplicable, and there are fears that their public tearing and clawing at each other may be the first signs of the dreadful “death grip” seen in the ants.

The carpet-chewing and mouth-frothing associated with ACT policies on law and order, welfare reform, and government spending also indicate that the fungus may have infected the wider party membership.

 A graphic illustration of the the effects of the fungus. ACT MP John Boscawen is pictured

John's Diary: 24/8/10

I get down when people keep saying my government has no plan for the future. They're wrong. There is a plan, and it is to say and do anything necessary to get re-elected in 2011. LOL!

I suppose that will sound cynical. Shouldn’t we be doing what’s right for the country, rather than just clinging to power at all costs? How will I live with myself if something I did contributed to our nation’s continuing poor performance?  Thankfully, I can't remember a promise made a week ago, so in years to come I won’t be troubled by recollections of what I failed to do as PM.

We sure are sticking it to the kids. Simon thinks the alcohol reform package will finally clamp down on young drinkers. Which is good. Even if most of our alcohol problems are caused by the over 20s.

I told Simon I thought getting kids to stop binge drinking was a waste of time so long as their parents continued to behave irresponsibly with alcohol. But apparently the kids don't vote for us, while their pissed-up parents most certainly do. So our liquor law proposals make little sense and won't change a great deal, but the important thing is we can say we're doing something.

Simon was also insistent we not move the blood alcohol limit for driving, even though it's a bit of a no-brainer to make this change. He and Steven told me we were sticking with the plan, even though I quite liked the idea of asking Parliament to vote on a conscience basis. But Steven warned me that asking our caucus to examine their consciences would open up all sorts of dangerous possibilities, so we put a stop to it.

So we'll get more research done before changing the law. There’s an enormous amount of evidence telling us what the effect of lowering the blood-alcohol limit will be, but there are still gaps in the research. Big gaps. For example, it turns out that there’s been no study undertaken on the potential links between drink driving and the Great Plague of 1348. We also have to consider the environment and global warming. I've no idea why, but Simon told me I should say that if I get stuck. Simon's always got my back. He's even painted a big red target on it. LOL!

So we’ll take a look, decide what the public want on any given day, and go with that regardless of what our additional research says. Because I’m a man of the people.

I've been dreading Parliament, because the other lot have been trying to trip me and my ministers up on our commitments to close the income gap with Australia by 2025. Apparently this is one of those promises I’m meant to keep. Damn!

Rodney and Heather have been fighting again. Heather seems to think ACT has turned its back on its founding principles, and is blaming Rodney. In responding Rodney followed the playbook he learned on Dancing With The Stars, though thankfully when he dropped Heather she didn't land on her head.  I've never considered Rodney to be a bully, but then I've never actually tried to stand up to him.

This ACT business sure leaves things in a mess, though, and it’s a good thing we don’t have that kind of carry-on in my party. I say good luck on finding a principle any of us are prepared to fight for. LOL!

It's so good to see us excelling at something, even if it is something I can't claim any credit for.  After a tremendous victory by the All Blacks in South Africa, the leadership skills of Richie McCaw are being lauded to the skies by the media and McCaw's own teammates. On these occasions I naturally expect comparisons to be made between McCaw's leadership and my own. McCaw is charismatic, driven, demanding, and at the very top of his game, and his team would die for him. So no real comparison then. LOL!

Anyway, consistent with our policy of asking every still-breathing ex All Black whether he'd like to stand for National (Keith Murdoch, where are you?), I might see if McCaw wants to join our team after he retires. I could take him under my wing and teach him everything I know. McCaw may be a champion player, but when it comes to cynical play, slowing the ball down, and interfering with the opposition's game, I could teach him a few tricks.

I've also asked our party strategists if they should be targeting the ex-All Blacks of the future. We have a fantastic opportunity at the next Northerrn Roller Mills Rugby Tournament. We'll be able to recruit from the very best 12 and 13 year old players.

Oh wait, Simon just reminded me that we hate young people. Scrap that plan.

Monday, August 23, 2010

Let's Beat Up On The Poor

 Bully Bennett has been stick-waving at beneficiaries again.

And she is also blaming Maori for the fact that rates of child abuse and neglect among Maori are so high.

When asked on The Nation on Saturday morning why abuse rates among Maori are so high, Bennett said:
I would tell you that I think it's a combination of isolation. Most of those that are in that sort of situation, their parents have not been parented well themselves, they’ve been notified to Child Young and Family. There is I reckon a bit of isolation, a lack of hope, and a lack of good parenting.
Those are all factors, but Bennett failed to acknowledge the main reason why Maori tend to lead the most undesirable statistics: incarceration, poor health etc.

It’s poverty.

It’s well known that poverty can be linked to just about every social ill there is: violence, crime, addiction, etc. Maori have always been at the bottom of the heap socio-economically, and they continue to languish at the bottom. So it figures they'll be hit the hardest.

But it’s easier for politicians like Bennett to blame a marginalised group. If she was forced to admit poverty was the biggest factor in the rates of abuse, she might have to then explain what her government has done to reduce levels of poverty.

When you consider the steps her government has taken, none of them have had or are likely to have any noticeably positive effect. Tax cuts mean nothing to those on welfare, and for those earning minimum wage any small tax cut will be largely gobbled up by GST rises. The government steadfastly refuses to move on the minimum wage, and continues to call for an end to welfare abuse. It’s all very well to talk about welfare dependency, but when there’s no work what exactly are beneficiaries supposed to do?

The modern age puritans believe work is the only measure of a person’s value in society. They believe that if more people are working and fewer are on welfare, many of society's ills will disappear. It’s a pipedream. Firstly, the work has to be meaningful and pay reasonably for it to make a difference financially. Any job also has to work in with family commitments, such as the needs of children. When parents are absent because they're working shifts, that can contribute to problems in the home.

Much is made of the need for sickness beneficiaries and solo mums to get back to work. Bennett talked about this on The Nation, and the Welfare Working Group report discusses the issue at length. But the part-time job options for many stay-home parents are often lousy. If you’re on the DPB and your kids are at school, just where are you going to find a part-time job that lets you work only between 9-3pm on weekdays, lets you take the school holidays off, and has ample leave allowances for the inevitable child illnesses?

If the government was serious about getting people into work, it would be putting more emphasis on adult education and funding childcare. Instead these areas have suffered significant cuts. So not only are there few jobs, but steps are being taken to make it more difficult for beneficiaries to return to the workforce.

We don’t have a welfare crisis in this country. A crisis is being manufactured, because it suits a government with no economic plan to have a distraction. So they attack and further marginalise those who will probably never vote for them anyway. Spiteful meanness seems to be a common theme in much of the political discourse on the right, so attacks on the poor play well with supporters of right-leaning governments.

I can forgive the Welfare Working Group for their naivety. How many of them have actually experienced poverty? Bennett, however, I cannot forgive. As a former DPB mum she ought to know exactly what it is like at the bottom. But like most apostates, she seems driven to destroy that which once sustained and nurtured her.

Free To A Loving Home

I'm wondering if anyone can help me. I realise this is the second post in a row where I have sought the assistance of my readers, but it is all for a good cause.

I don't like wastage. Maybe it's the years I spent as a student on the bones of my arse, barely able to pay the rent. They were years ago, but they left a lasting impression.

So when I have more of something than I need, I don't like to throw it away.

Anyway, for the last week or more my household has been experiencing an excess of snot, dribble, mucus and phlegm. I'm not sure how much of this stuff a family needs to get by on, but we sure have more than we know what to do with. I figure you can normally expect some of this stuff during the winter months, but we must be breaking some records, I tell you.

I've tried to come up with creative uses for it all, but good recipes seem thin on the ground and, although this stuff would probably make a good glue, I suspect the smell might become a problem after a while.

So if anyone has a need for any of this stuff (maybe you're a collector, or you're thinking of starting some kind of weird organic farm), let me know and I'll get a few buckets of it for you.

It would be a shame to tip the stuff out.

Friday, August 20, 2010

I Need Your Help

Dear readers

I’m hoping you can help. I don’t usually ask for advice over the Internet, not since I consulted that quack online doctor about my “little problem”. That was a bad experience, I can tell you. Thankfully everything has scabbed over nicely since then, so I should be okay in a couple of weeks.

Anyway, here’s my problem. I am becoming increasingly disheartened at the economic direction this country is taking. I no longer know whether raging about the issue on this blogsite is making a difference. I don’t know if anyone of influence is reading anything I say, but I suspect the truth would hurt my fragile ego.

So my question is this: what should I do? I’ve narrowed my options down to these: 
  • Emigrate
  • Write a stern letter to the New Zealand Herald
  • Form a crackpot political party, hold the balance of power, then hold the government to ransom until I get my way (the NZ First/ACT model)
  • Purchase a range of firearms and knives from various disreputable persons, then begin the Reaping, so that my enemies and quite a few innocent bystanders as well may Come Unto the Lord
  • Join a mainstream political party, and work tirelessly up through the ranks until one day I become an MP, then plan and execute a ruthless and brilliant leadership challenge that leaves me as boss (i.e. I will not be seeking advice from Chris Carter or Heather Roy)
  • Begin training a secret army in the Ureweras, position ourselves quietly around Parliament and the Beehive, and then launch a coup d’état against the Government during a session of Parliament. (I will need to give myself a military rank if people are to take me seriously. Is Field Marshall grand enough?)
  • Give up all resistance and embrace the darkness (hey, I’ve got enough to get by on even if things go really pear-shaped, and my kids can always move to Australia when they get older)
  • Do nothing, apart from continuously whine (the status quo option).

Any thoughts? Have I missed any obvious options?

Allied Nationwide Gone, Allied Farmers Next?

So Allied Nationwide (the finance arm of Allied Farmers) is in receivership.

It became obvious many months ago that the Allied Farmers purchase of the Hanover loanbook was a deeply stupid thing to do.

It seems the only people who get to leave relatively unscathed from the entire Hanover mess are the people who caused it. I expect Allied Farmers will now fall over and leave a whole pile of investors (including many who got stung by their Hanover investment) out of pocket.

If I had shares in the company, I'd be selling them*. Even though they're already next to worthless.

This is one prediction I'd happily be proven wrong on, however. Because, as usual, the people who will suffer most will be the small investors.

If/when Allied Farmer goes belly-up, it will leave some serious questions to be asked about the level of governance of some of our companies. Can you blame people for sticking all their money in real estate when you consider the way some of these companies are run? 

* Don't quote me. I'm not an investment adviser. Although some people in the investment industry would probably be saying "buy now!" Sigh...

NZ Institute Report Should Be Obligatory Reading For Politicians

The New Zealand Institute has written a report entitled A Goal is not a Strategy: focusing efforts to improve New Zealand's prosperity. You can see a copy of the report here.

The title is a swipe at the National Government's goal to close the income gap with Australia by 2025, even though there appears to be no plan to achieve that goal. The report is also critical of the 2025 Taskforce and ideologically-driven market liberalism generally. It is a genuinely refreshing read on the state of our economy and what we can do to increase economic growth.

The report pins much of the blame for our poor performance on an over-reliance on economic liberalism. Some features of economic liberalism are necessary and desirable, but a blind adherence to liberal policies has harmed our economy. 

The report identifies the ten standard prescriptions for economic liberalism followed by many western governments. They include: fiscal policy discipline, government focused on core services only, tax reform, market determined interest rates and exchange rates, liberalisation of trade and of inward foreign direct investment, privatisation of state-owned assets, market deregulation, and secure property rights.

The report favours an alternative approach to economic liberalism, labelled the "diagnostic approach". Essentially, the diagnostic approach moves away from ideology and looks at the country-specific binding constraints on economic growth. In this way the policies adopted by each country will be unique, because conditions are different in every country. That is a very different approach to the one taken by the economic liberals, whose prescription is always the same (cut taxes, sell assets, cust government spending, deregulate etc), regardless of conditions.

Examples are given of Asian economies that have applied a "diagnostic" approach. These countries have identified issues specific to them, and have not been afraid to intervene in areas where market liberalism would prescribe non-intervention.

The diagnostic approach may sound like plain common sense, but the neo-liberal acolytes running National and ACT Government are not kindly disposed to adoping any methodology besides the one they understand. Their minds are generally closed to other ways of doing things. You can see this clearly in the 2025 Taskforce Report. Its recommendations were based entirely on liberal economic theories. While John Key has distanced himself from those recommendations, one senses that he has only done so because they are politically unsaleable, not because he disagrees with them.


The New Zealand Institute report looks at our low rates of productivity and examines the reason for those low rates. One of the main reasons for low growth it identifies is our over- reliance on commodity exports. Commodity prices are fickle, and this means the value of our exports, compared against the OECD average, continues to slide. We will not arrest this slide unless we invest more in high value exports. That is why the value of our exports compared to the OECD average is so poor.

The report notes that we would be better off growing the market for high-value exports, such as niche manufacturing, or the manufacturing of value-added primary produce. ICT is also an area where we can do well, and where our distance to market is not such a problem.

It is sobering to think that we were once a wealthy nation. The shock of the UK entering the EU in the early 1970s was catastrophic, and we responded to that challenge extremely poorly. The head-in-sand policies of the Muldoon government set New Zealand back by decades, and meant the reforms of the '80s and '90s were more painful than they needed to be. Things have steadied since 1990, but we have not seen any rise in our fortunes when compared with other countries.


Productivity is also stifled by the shortage of capital. We have some good entrepreneurs and risk-takers, but our poor savings records and addiction to overseas debt mean there's little money for new ventures or new businesses. The only money readily available is from banks, and banks are conservative lenders. We also tend to rate our management skills more highly that can be reasonably justified. Overseas reports have suggested we have a shortage of good managers, and this is constraining many of our companies.

We are also poor at commercialising innovation. We're good at inventing and coming up with bright ideas, but terrible at taking them to market. This is partly due to a lack of capital, but there are a lot of other reasons for this lack of success, which the report does not address. I've written extensively on these before.

We can also do better on the education and skills front. We still have too many people leaving school without basic skills. And many who are highly skilled choose to ply their trade overseas.

These things can be improved if governments are prepared to invest in education and training. Unfortunately, the narrow focus of the current regime on standards, while cutting funding to adult education, suggests this is a low priority.

It will not be easy to fix our poor capital markets. A tradition of deregulation and of speculation in real estate, and an addiction to overseas borrowing, has left our capital markets in a parlous state. A move to encourage savings may help, and there are clear signs both major political parties have this on their agendas. There is also some work being done on capital and securities market reform at the moment. Unfortunately, only a few of the incentives to invest in real estate have been taken away.

This report is a good reminder of how flawed our current economic model is. For the last 25 years we've been told that the key to economic growth is tax cuts, deregulation, and a reliance on the market. This report reminds us that market liberalism simply won't work, unless it takes into account the unique challenges we face as a nation.

We are still driving in reverse: obsessing over tax cuts, cutting red tape, and reducing government spending. Key's government is at least "taking a look" at a few things, such as compulsory savings, and capital market reform. But Key seems to lack the nerve to make tough decisions*, so I am not hopeful we will see the "step-change" Key keeps talking about any time soon.

* To be fair to Key, it's not as if Labour's nine years in power saw much change on many of these critical issues.

Thursday, August 19, 2010

Right Thinking: Time To Teach The Scienticians A Lesson

Renowned columnist Dr. Frank Shizenhausen's latest blistering attack on political correctness.

I am delighted that the Climate Science Coalition are taking NIWA to court. I’ve never for a moment believed any of the claims made by climate science quacks that the Earth is warming, and that we humans are responsible.

Here’s a news flash for all those science people. Of course the Earth gets warmer. It happens every summer, stupid.

The arguments wheeled out by scientists are so full of holes they can’t be taken seriously. They say there’s no question that the Earth is warming, but they can’t even agree by how much, and there’s little else they can settle on. Scaremongering seems to be the only thing they can do in unison.

Well call me a cynic, because I’ve heard bogus claims like this global warming tripe before, and always from the scientists or so-called experts. Like the absurd claim that giant reptiles roamed the Earth millions of years ago, despite there being irrefutable documentary evidence (i.e. the Book of Genesis) proving them wrong.

The global warming hoax is yet more evidence that mischievous scientists are at work. They are never happier than when spreading panic. It seems that nowadays just about everything will kill you or give you cancer. Yet when I was growing up in a small town we didn’t worry about what we were eating, or smoking, or pumping into the atmosphere.

But these days we’re overwhelmed by information, which means that scientists have so many more ways to spread fear. The information age and book-learning have a lot to answer for.

If you can manage to pin a scientist down on any issue, the answer they’ll give you will be so shifty and qualified that you may as well not have asked. “The data tells us this,” they’ll say, “but on the other hand this other data says the opposite. We hypothesise that A is happening, but we need to undertake more studies to determine whether in fact A is B. Give us more money.”

Can anyone else see the gaping hole in their reasoning about climate change? They can hardly agree on a single damned thing, and yet mysteriously they all agree that climate change is occurring and that we’re all going to hell in a handcart. Well, isn’t that convenient?

These professional deceivers can’t have it both ways. They claim the scientific knowledge is cumulative, and that new learning will sometimes disprove old theories. But if that is true, how can they claim their data is accurate and must not be questioned? Either universal truths exist, in which case all of this goddamned sciencing is a waste of time anyway, or else anything goes, in which case everything is up for questioning – including the official climate change data.

I also think there is something profoundly disturbing about our trying to unravel the mysteries of life, which is another reason why I can’t abide scientists. The idea that nothing is certain, and that knowledge is ever changing, is one of the reasons why children do poorly in schools today. They don’t know who or what to believe any more. It’s no wonder that the majority of them turn to rap music and P.

This “anything goes” attitude within the scientific community also explains why so many of them are scruffy. They have eschewed all community standards, so why bother to wash or wear clothes that fit properly? It’s not a lack of money that keeps them looking so disgraceful and down at heel. The science community is awash with grant money. Ah, but the scientist is a cunning beast, and hides his wealth by driving a run-down car, by living in squalid rented accommodation, and by constantly complaining about how lousy their pay is. Only when they are together in their secret gatherings (innocently entitled “conferences” to fool us non-scientists) do they let their guards down.

Well, scientists, I’ve some bad news for you. The brave folk of the Climate Science Coalition are on to your little lark, and the public teat is about to run dry.

Their legal challenge will strike a powerful blow against the morally corrupt "anything goes" values scientists seek to instill in our young children. It’s time we reminded scientists that some truths are universal and absolute.

******

The plan to build an enormous mosque in New York next to the site of the World Trade Centre is a deliberate provocation and outrage.

The Islamists adhere to a faith that is absolutist and cruel, and anyone who questions their belief must pay the price. Any faith that can contemplate stoning someone to death is a barbaric one.*

Our modern society has no place for such religious dogma. Western society is enlightened and open, and our values are founded on reason, tolerance and respect for others.

Some people say opposition to the mosque is founded on racism. That’s both offensive and laughable. Just because I hate all Arabs, that doesn’t make me a racist.

I remain hopeful that the people of New York will rise up and refudiate this monstrosity. Their combined voices will strike a powerful blow for reason, tolerance and science against the terrifying morally absolutist world the Islamists live in.

* I except, of course, the stoning offences prescribed in the Old Testament. I have always argued that our society would be a richer and better one if we resumed the stoning of blasphemers, fortune-tellers, and those who work on the Sabbath.

Not So Fun When Someone Else Gets All The Attention

Over on Kiwiblog David Farrar whines:
I am curious as to why the media think it is their job to try and help Winston Peters back into Parliament, just because it means that they get more interesting stories.
What I mean, is the media overkill that reports almost every utterance from Winston. Every speech to a room of oldies or students results in stories. An off the cuff comment about how he is not ruling out Helensville gets reported breathlessly on TV as a major story. Hello – what is news worthy about a guy who had a 30 year old beat him by 10,000 votes in his own former seat, speculate he may stand in a seat where the majority is 20,000 and he would be lucky to get his deposit back
Until the mood of the media started to change a couple of months ago, they were uncritically reporting almost every trivial thing Key said or did. They were effectively campaigning for Key.

I don't recall at the time reading or hearing any objections from Farrar about that.

Winston won't win Helensville in 2011 (he may not even come second), but may still make a nuisance of himself, and he is clearly out to get National. Like many other National Party strategists, Farrar has probably been having night terrors about the "Winston Factor" next year.

Up until a couple of weeks ago I'd have said National had next year's election in the bag. But with ACT's very public self-destruction, and with Winston starting to get some traction in the polls, things may get a bit tricky. The election's still National's to lose, but if NZ First makes it in and ACT doesn't, Labour may have more coalition options than National.

Wednesday, August 18, 2010

Not Quite Outrageous Fortune, Is It?

I have a great idea for a TV show. It's a drama about a hopelessly dysfunctional family and all the crap they get themselves into.

Let me give you the basic outline. The husband is big man on the factory floor, and everyone calls him "sir" at work. But he's also a bully who behaves insufferably towards his wife. Let's call him Rodney.

The wife, Heather, is loyal in public, but secretly loathes the man she has found herself trapped with these last few years. She keeps a diary of all the slights and insults she is forced to endure, and she plans one day to release this to the world. That diary will reveal that, although her husband is a bore and a bully, she is prone to overreacting.

The eager-to-please teenage son, John, is always seeking to earn the praises of his father. He's a headstrong boy who's just like his Dad. He won't listen to reason and thinks he knows it all. He worships the ground his father walks on and likes the way Dad lays down the law at home.

Meanwhile, David, the boozy and slightly smelly lodger, has been staying in the caravan out the back these last few months after a series of personal disasters that left him homeless. Nobody really likes David, but someone once did a big favour for Rodney and the price Rodney had to pay was to find somewhere for dear old David to stay. It's only for another year or so, Rodney tells himself.

The story follows the breakup of this hopeless marriage. It is a long-simmering disaster, but the eventual explosion is triggered over something stupid and trivial. Heather's been stashing away secret papers, and Rodney learns of their existence. In a fit of mad jealousy Rodney demands to see them. She refuses, and he rages at her, accuses her of unfaithfulness, and threatens to kick her out of the house.

John takes his father's side, and believes every word Rodney says about his mother. David doesn't care much for Heather, because she's a women and women are all the same. It's Rodney's castle and it's a man's world. He doesn't plan to step in if Rodney decides to chuck her out of the house. Even though his days are numbered and nobody likes him, he still dreams of moving out of the caravan and into the house, into a proper bed.

Granddad Roger, Heather's Dad, tries to mediate. He's no angel and has a dark shameful past, but family is everything to him. He knows his daughter is headstrong and flighty, but he's also old-fashioned, and in his world you don't walk away from your marriage. He urges conciliation between the two and tries to get Rodney to change his attitude.

But Rodney won't be told what to do by anyone, and certainly not by some old man. He throws Heather's belongings out of the marital home and then stomps off to work. When his work colleagues ask what's been going on (they've all heard the rumours), he refuses to talk about it, and just snarls at them.

But Heather is planning her revenge. That's Episode Two, and I haven't worked out how that will go yet.

If They Win

The Climate Science Coalition (CSC) is consulting its lawyers over the alleged breach of a court order that ruled climate change was not occurring.

The CSC sued the Crown Research Institute NIWA over weather data issued by the institute, and obtained a ruling by the court last year that NIWA’s data was invalid.

But the CSC are concerned that global temperatures may have risen, in defiance of the court order.

CSC spokesman Terry Dunleavy said the recent atmospheric activity was concerning.

“It may just be an anomaly, but we would certainly be very concerned if temperatures were on the rise, in defiance of the judge’s order.”

Legal experts are divided on what steps the CSC might take.

Auckland University Associate Law Professor Nigel de Blath said it was not absolutely clear who or what was behind the recent temperature changes. But if it was God He may have a case to answer.

“On the face of it He appears to have breached the spirit of the court order, if not the actual express language of it.

“I think we all accepted when the ruling came out last year that climate change was at an end. The judge made his views very clear on the subject.”

Mr de Blath said the latest temperature anomalies made a mockery of the entire judicial process.

“NIWA had the opportunity to appeal the judge’s decision, but didn’t. To be honest, I think everyone was just so relieved to learn the climate change crisis was finally over and that we could go back to our old polluting ways.

“So this latest move really is a slap in the face, and I would expect urgent measures to be taken to put a stop to it.”

But barrister and chairman of the Law Society’s Civil and Commercial Affairs Committee, David Walter, said it was unlikely the CSC would be able to enforce the court order.

“The procedural issues alone will be daunting. Firstly they will have to establish which deity is behind the atmospheric changes, and then they’ll need to work out how to serve legal documents on Him. It’s not unheard of nowadays for elusive defendants to be served via Facebook, but I’m not sure whether old-fashioned deities like Jehovah or Allah are attuned to social media.

“There are also a host of jurisdictional issues to contend with. And then there’s the potential cost to the plaintiffs. They will effectively be taking on a defendant who has unlimited resources.”

Mr Dunleavy has not said what action will be taken if climate change is in fact occurring. But he is not ruling out another battle.

“We took on NIWA and won, even though we were openly mocked at the time. They called us a bunch of cranks, even though we ended up saving the planet.

“The stakes are high and if we need to take action we will. We’re not afraid of taking on the establishment.”

None of the major gods could be reached for comment.

Another Day, Another U-Turn

Remember how John Key said the Government would not change the drink-driving alcohol limit until further research had been done?

Then remember how a couple of week later he said he expected a vote on Labour bill to lower the limit to be a conscience one?

From the Herald last week:
"I imagine it would be a conscience vote," he said.

"I know there's a wide range of views within our caucus.

"So that's something I would have to take to caucus, but off the top of my head I'm not proposing to stand in its way."
Now he's gone to caucus and has been told by Joyce and Power that his original flip-flop makes them look bad. So he's flopped back to the original plan:

Today:
National MPs will vote on drink-drive limits as a party, despite Prime Minister John Key earlier indicating it would be a matter of conscience.

Last week Mr Key said the decision on how to vote on lowering the blood alcohol level for drivers, proposed in a member's bill from Labour MP Darren Hughes, was likely to be left up to individual National MPs.

However, after discussions at caucus yesterday, Justice Minister Simon Power and Transport Minister Steven Joyce said the party had agreed to a free vote on the purchase age but not on other changes relating to alcohol.

Yesterday, Mr Key denied it was a backdown. "It's actually the opposite ... That was the will of caucus. I was happy to support either view but I'm more than happy with the position they've adopted."
Key at least left sufficient room in his first statement to claim the subsequent position isn't a complete u-turn. He did mention, after all, that the matter would be determined by caucus.

But that won't wash. Key is leader of the party, and when he expresses an opinion on what he expects the caucus decision to be, we should be able to rely on it. It seems, then, that he was overruled.

It is probably coincidental that the two ministers who announced the new voting position, Power and Joyce, are regarded as rising powers in caucus and as the most likely to succeed Key. Key doesn't need to worry about leadership challenges while he is riding high in the polls. But now might be a good time to invest in a stab-through vest, to deflect the knives that will be aiming for his back as soon as his polling begins to drop.

Tuesday, August 17, 2010

A New Deputy Leader And A New Logo

Law Changes Will Affect Local Body Elections

The Government has moved urgently via Parliament to amend the Local Government Act.

The changes came into affect today. The amendments tighten the rules that apply to local body election campaigns.

Local Government Minister Rodney Hide said there had been considerable concern within government about the campaigns of some candidates.

"The amendments remove a number of anomalies that currently exist," said Mr Hide.

"At present there are strict limits on what candidates can spend, but almost no limits on what they can say. That makes no sense."

The law changes mean that, for a 60 day period before elections, certain misleading words and phrases cannot be used by candidates.

The list of banned words and phrases includes the words "vibrant" and "vision".

Critics have slammed the sudden move, saying it is undemocratic and impinges upon free speech.

But the law change has delighted Citizens and Ratepayers, the main centre-right grouping contesting local body elections in Auckland.

Citizens and Ratepayers had been facing a concerted campaign from the centre-left City Vision party to take control of the new Supercity. Now City Vision will have to rebrand and find a new name, at considerable expense.

Supercity mayoral candidate John Banks could not be reached for comment on the law changes. However, he has previously stated he believes there is no place in Auckland politics for either vibrancy or vision.

His main Supercity rival, Manukau mayor Len Brown, would not comment officially on the matter. His campaign manager has explained that Brown is worried he might inadvertently break the new laws by commenting on their effect. This is because Brown is unable to string a sentence together without using the words "vibrant" and "vision".

Monday, August 16, 2010

Phil Says: It's Harder Than It Looks

It's a tough job being leader of the Opposition.

But I'm used to tough jobs. It may be the worst job in Parliament, but I have never shirked from a challenge.

People are always attacking you for something when you're the leader of a political party. I don't complain, though. Life's not meant to be easy.

I remember what my father would say to me when I was a boy and someone had been unkind to me. He would sit me on his knee and say, "son, pay no mind to such folk. Don't let their words get to you. Being a man is all about turning the other cheek."

That good advice, and it's served me well throughout my political career.

When you spend so much of your time in Wellington, it's good to have something to escape to, so I look forward to getting back to my farm and chopping wood. With axe in hand, and with my torso muscular and glistening with sweat, I will lay into a pile of wood with brutal savagery.

My wife does most of the work around the farm, because I'm away so often, but she likes to watch me chopping wood. Something about the constant rhythm of my golden-tanned muscle-bound body pounding that weapon into the wood seems to drive her crazy. As my body rises and falls I will often catch sight of her from the corner of my eye, pouting and breathing heavily. When my work is done she'll usually be in as much of a sweat as I am. Then I'll go to her and embrace her with my powerful arms, before ripping of her dress and flinging her to the ground.

As our sweaty bodies roll in the grass and we take our pleasure, I will often think about the years of service I have given to our nation, and will reflect on my own performance. It's a performance I'm proud of.  I know what drives the people of New Zealand. They want to know that their political leaders will be strong, responsive, and determined to push hard for what they need, again and again. But I'm no one-trick pony, and I've been on the scene long enough to know there's more than one way to get the job done.

When our hours of passion have ended we'll put on our clothes and I'll ride into town on my motorbike, the huge powerful engine roaring between my legs as the ACDC pumps through my headphones. I'll have a Lion Red or two with the boys and watch the big game before heading back to the farm, but I'm always happy to oblige if someone at the bar wants to talk about politics.

I often get asked at these times why people should vote for me or my party. I tell them it's about leadership. Being in charge of a team means always being ready to make the tough calls, do what's right, and not worry about short term popularity.

I have never been concerned about the chattering of others. I learned at a young age what it means to be a man and to make the hard calls. I left home at sixteen and had to make my own way in the world. I was lucky enough to get a university education, but the experience I gained in the School of Hard Knocks was much more valuable.

And once you get to my position the work doesn't get any easier, let me tell you. It's just like the words of that song:

Ridin' down the highway
Goin' to a show
Stop in all the by-ways
Playin' rock 'n' roll
Gettin' robbed
Gettin' stoned
Gettin' beat up
Broken boned
Gettin' had
Gettin' took
I tell you folks
It's harder than it looks


I know I'm up for the job. Our people want a firm, experienced hand. Someone who will listen and who is attentive and understanding of their needs, but who is brave enough to try something new when the occasion requires it.

My record of public service stands proud. You can be sure that I will give you what you need.