Sunday, February 23, 2014

Is Labour targeting the wrong issue?

John Key said today - "The big issues are the economy, law and order and health and education and our programme's working and the results are good." and he also said asset sales and Kim Dotcom weren't the big issues - what Labour was focusing on - explaining poll results.

Opposing asset sales was important. It was passed with a 1 vote majority and most people who submitted during the select committee hearings were against it. It has so far cost the country $440 million. This is a great policy for investors in the share market. Investors cycle their money in the capital markets and the housing market and all the foreign markets but never in the supermarkets. So Labour opposed asset sales – as they should have (so did the Greens). Some would say it’s why they were elected. I’m not as convinced about the referendum. And I wasn’t really convinced about the results either. I would have preferred to see it in the 80s. But I also think that the combination of the low election turnout and this shows that many many voters are not really engaged in NZ politics and somehow we need to get them engaged (We = left & right). New Zealand is one of those countries which is starting to get cited in academic articles about the privatization of public administration. Whether or not this is a good policy, there can be no doubt that this equates to transfer of wealth from the public to the select private. I do not believe this is good public policy and Governments are elected to administer PUBLIC policy not advance the interests of a select (but powerful) minority’s economic interests. These issues do matter. 

Labour has come up with a comprehensive 'baby bonus' policy to deal with the costs of having kids (benefiting society in general – we need kids to be born!). People might not like it but it addresses systematic inequalities in society that is preventing many families from moving ahead in life. Why do we need this? Because I don’t see businesses picking up the slack. They are happy to use the labour and brains of people, take in profits, pay them as less as possible by holding employment as hostage, enjoying many tax benefits and effective subsidization of their profits and the whole time bemoaning that people should take individual responsibility. I 100 percent believe that I think it is businesses’ job to make profits. Of course they should make (and keep) profits and I certainly am not going to dictate how much that profit should be but if the profit was at the cost of workplace safety, for example – we would think that was a pretty rubbish business model and would not endorse it. So, why is keeping workers in perpetual poverty any different? (2 in 5 children in poverty come from families where parents are working). Let’s also not forget successive reports that have shown Working For Families has kept us away from even worsening child poverty – a policy introduced by Labour. What has National done – a Ministerial committee on poverty that seems to make no policy changes, an expert advisory group’s recommendations that are cherry picked, employee rights slowly whittled away for business interests. Oh but wait! We do have oil and gas exploration that will create jobs and bring wealth (but of course without meeting any of the environmental security concerns).

The Kim Dotcom issue is a weird one for me. It’s an on-going legal issue which has already demonstrated some major failures by our law enforcement agencies, agencies who haven’t really been held accountable under this Government. If there is a brewing civil rights issue (KDC is a NZ resident) or breach of due process, the opposition should absolutely look into that. Maybe people don’t care. Maybe people don’t see this as affecting them but I think to a certain degree, we expect in a democracy that the Opposition will act as a check on the government and its actions.

Gay marriage, euthanasia, abortion affect people and National isn’t going to touch them with a 10 feet pole. Over and over again it’s Labour that has taken on the responsibility of dealing with these issues. It will never be right time for National. Even during a rock star economic boom, National focused on the flag and not the constitutional changes that the country desperately needs and not any of these issues that actually affect people’s lives. Why? Because it doesn't sound sexy. Someone has to take this responsibility of governance on behalf of the people and I don't think it will be National. So they may not seem like meaty issues but they are relevant. National doesn’t have any problems getting on the gay marriage, Mondayisation, PPL and drunk driving limit bandwagon because they know it’s something that has to be addressed, but they won’t introduce it themselves. National didn't like WFF - still here, interest free student loans - still here, kiwisaver - still here, anti-smacking - still here. All notable policies. All policies passed under the previous Government

I don't think Labour was in government for 9 years by focusing on the wrong issues. I think fundamentally they, like other parties in Parliament, want to govern in order to improve the lives of Kiwis. I do think they have the best interests at heart in all their policies. Yes, they tend to focus on the less glamorous parts of society. So instead of Peter Jackson its forestry workers. Instead of oil and gas, it's apprenticeships for the disaffected youths. Instead of the rights of the Motion Pictures Association of America, it's the civil rights of gay and lesbians. 

What will John Key's National government be remembered for? I’d like someone to do a poll where they ask New Zealanders what their favourite flagship policy of the last five years is without giving any prompting examples. May be Wallace Chapman will ask this question on the streets. I’ll be surprised if people can answer anything definite. But hey 51% of the country loves National so maybe I am completely wrong. Maybe Labour is focusing on the wrong issues.

Saturday, February 8, 2014

Who needs a break?

So we have two very interesting articles in the papers today. Colin Espiner at Fairfax thinks our minimum wage should be $16 and Damien Grant at NZ Herald we should cut tax cheats some slack because they contribute to society. This divide created between the job creators and the job doers suggests that one is more superior to the others. When Elizabeth Warren in her famous quote said that the so-called job creators didn’t just do it on their own, she was telling the truth that those at the top and their advocates do not want to hear. From the day labourer to the PHD, everyone contributes to society. It’s off the backs of their hard work, their education, their brain, their hands, their words that we as society get to develop, we get to progress, we invent new things, we mass produce those inventions, we come up with new ideas, we get interesting novels, movies, tv shows and songs. Sure the marketplace has decided that laptops are more valuable than chocolate cake and maybe they are, but the marketplace has failed spectacularly when it comes to compensating for ‘hard work’ fairly. Maybe the 85 people who have the wealth of half the world’s population really work as hard as half the world’s population and had exactly the same opportunities as half the world’s population but somehow I really doubt it.

Last night I started reading Ayn Rand’s “The Virtue of Selfishness” where she suggests that society sees industrialists who make a fortune and bank robbers as equally immoral because they both seek wealth for “their own selfish benefit”. This is factually incorrect. We put bank robbers in jail and we give tax cuts to industrialists. The minimum wages is not designed to vilify business owners, it is designed to make sure that the power imbalance created by using wealth as the yardstick does not lead to exploitation of the wealth-vulnerable. When I graduated from University and made the choice to work in the public sector I had to take whatever that was offered to me. Otherwise I would be destitute and on the benefit. In fact, if I turned down a job because the pay wasn’t good enough in my opinion, I would be kicked off the benefit. But when it came to getting the Chief Executive for the Ministry of Education, we had to pay top dollar to someone from the UK to mess up their job on epic proportions and still get an amazing severance pay. This is something that would never happen to a lowly analyst working the same hours. Sure the responsibilities maybe ‘less’ but they actually do the grunt work that makes the CEs look good but when they get fired, they get nothing.

In our society, we have minimum wages but we do not have maximum wages. Profit margins are morally more important than paying someone a decent wage to feed their kids. Some of us are against raising the minimum wage because our muffins will go up by 10 cents (Remember the 2011 election?). We also live in a society where workers' breaks are actually being curbed away. You know who needs a break? Someone who is on their feet 12 hours a day not tax cheats. I personally do think that the state has a responsibility in protecting its citizens – not from just terrorists attacks and health scares and natural disasters but from poverty as well. But I do not believe that the state should be subsidizing employers to do so. A representative democracy represents its citizens not corporations. I do think business owners should construct their business plans according to market factors and one of those factors should be wages. If they cannot afford to pay their workers, they should re-think their business model. If they can afford to pay their workers they should re-think their profit margins. And maybe I have those beliefs precisely because I am selfish. I don’t want to live in a society where there is widespread poverty. I don’t want kids growing up in poverty that increases their chances of being part of the justice system. I do believe that most people who are on the benefit are there because of circumstances beyond their control. And please don’t lecture me about the one person who has been on the DPB for 20 years because that doesn’t really mean anything in the grand scheme. How astounding to say that beneficiary cheats contribute nothing to start with – assuming that everyone on the benefit is always on the benefit and always was!

The GFC was brought on by people at the top who made very deliberate bad decisions to game the system for their gain. It was not brought on by people on the minimum wage. Yet they are feeling the brunt of it. I don’t remember people in the lowest rungs losing their jobs getting government bailouts. No, what they got was austerity measures, benefit cuts, and services cuts. I remember CEOs going to spas and playing golf on their government bailout money – taxpayer subsidized party for causing one of the largest financial crises of our generation. The lost generation of people who tried to enter the work force between 2007 and now will pay the cost of this failure for the rest of their lives.

So no, I don’t think tax cheats should get a break. If you believe you deserve a greater pay for greater responsibilities, you have to take that responsibility when you mess up.