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NZCPR Weekly                                                                              

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THIS WEEK...

HOPES OF A NATION

In his iconic book “Free to Choose”, Nobel Prize winning economist Milton Friedman, described what underpins a nations’ economic power: “A free society releases the energies and abilities of people to pursue their own objectives. Freedom means diversity but also mobility. It preserves the opportunity for today’s disadvantaged to become tomorrow’s privileged and, in the process, enables everyone, from top to bottom, to enjoy a fuller and richer life”.

John Key appeared to have understood that fact in his Speech from the Throne just after the 2008 election when he promised that “The driving goal of the new government will be to grow the New Zealand economy in order to deliver greater prosperity, security and opportunity to all New Zealanders”. He then explained that “The true builders of that future are millions of New Zealanders working in the homes, the businesses, the industries of our country. It is they who make the country strong. It is they who have placed their trust in us their parliament. And it is they, our fellow New Zealanders, that my Government will ever seek to serve.” [1]  

While words sound good – it is actions that matter. After nine years of socialism the country was more than ready for a fresh approach. That’s why National was elected – to get the country back on track to deliver greater prosperity, security and opportunity to all New Zealanders. This is about people’s lives; their future. Drift and compromise is not an option.

A desire for a better future is also why voters were so supportive of John Key’s promise to prioritise a policy agenda to catch Australia by 2025. With an Australian family of four on average being $64,000 better off than New Zealand families, many Kiwis now have friends and relatives living in Australia. Since young people are especially keen to live in a country where they can get ahead, the heartbreak of grandparents separated from their grandchildren - because New Zealand politicians have managed the country so poorly - is becoming increasingly commonplace. Meanwhile the income gap continues to grow. It is estimated Australian incomes, which were 35 percent higher than Kiwi incomes in 2008, will have grown to 45 percent by 2013 - unless the government takes action.

The reality is that the dominance of the state, manifested in various ways, has bogged down the country. Everywhere you look, things have become more complicated and more costly. Wealth creators and people just going about their lives are confronted by endless new laws and regulations which collectively are handicapping New Zealand’s prosperity.

A good example from local government was recently described by Owen McShane of the Centre for Resource Management Studies. Owen has long held that not only are most planning laws unnecessary, but the actions of local government - through the powers given to them by the Labour Government - have dramatically hiked up the cost of housing in New Zealand.

Here’s how Owen explains it.
[2]  Someone in Kaiwaka in Northland, trying to create a section on which to build a house for retirement now has to take into account the following payments and charges: a reserve contribution (Council has chosen this time of recession to increase Reserve Contributions from 5% to 7.5% – a fifty percent increase) of around $15,000; a roading development contribution in the region of $10,000; a consent processing fees of $2,500; a challenge to the consent conditions of $600; a double gated street crossing estimated at more than $20,000; surveyors’ fees of around $6,000; planning consultancy fees of between $3,500 to $5,000. This means that all up, the cost of a small section in small town New Zealand has been increased by around $60,000 because of arbitrary local government charges and fees. It is no wonder that so many young New Zealanders are moving to Australia for affordable housing. Meanwhile those who stay are having to pay money they don’t have, only by increasing their long-term indebtedness to levels that are far greater than they should be.   

The high cost of housing is one of the issues raised by Dr Don Brash, the former Leader of the National Party and Governor of the Reserve Bank, and the 2025 Taskforce in their Report on strategies for New Zealand to catch Australia, which they released late last year. In their report they explain that, “Houses in New Zealand are now among the most expensive, relative to incomes, anywhere in the world. The Task Force rejects the repeated claim that in some sense too many resources are devoted to housing in New Zealand.  Existing houses cost too much mainly because too few real resources are devoted to house-building. Council zoning restrictions and arbitrary ‘urban limits’ prevent the release of sufficient land to lower the overall price of housing. Dr Arthur Grimes provided a presentation to the Taskforce reporting on his published research work on the detrimental economic impact of the Auckland Metropolitan Urban Limit (MUL). Beyond that limit, housing development is not permitted, and land just inside that boundary trades at around 10 times the price of otherwise identical land outside the boundary. There are few more striking concrete examples than that of costly inefficient regulation, allowed to persist with no proper economic cost-benefit analysis. Such a cost-benefit analysis should focus on the real revealed preferences of individuals, not ill-defined ‘smart growth’ strategies or preferences of local body politicians or officials. There is no shortage of land in this country, but local authorities prevent it being used for its most valuable purpose. That has to change. When it changes, housing will be a great deal more affordable: our incomes will stretch further.”
[3]

Given the hugely important contribution that the Taskforce has made to plotting a future course for New Zealand - in particular through the startling finding that if core government spending was reduced to the same proportion of GDP that it was in 2004 and 2005, the top personal tax rate, the company tax rate and the trust tax rate could all comfortably be aligned at 20 percent, with all those earning above $14,000 paying less tax and nobody paying more income tax – I asked Chairman Don Brash for some feedback on the responses he received to the release of the 2025 Taskforce report. Given the interesting points that he raised, I am publishing his “Reaction to the Report of the 2025 Taskforce” as this week’s NZCPR Guest Commentary.

In particular, Don explained that “
The Government’s reaction to the report could at best be described as lukewarm”. Having said that, he goes on to explain, “The good news is that the Government remains committed to having us reach Australian living standards by 2025.  The 2025 Taskforce makes no claim to infallibility, though its recommendations are entirely consistent with those made by successive OECD reports on New Zealand.  The one thing which is absolutely clear is that neither present policies, nor a few minor tinkerings here and there, will get us to the goal the Government has adopted.” To read Dr Brash’s full commentary, please click the sidebar link>>>

Mike Butler, a former newspaper chief sub-editor, who now writes for the NZCPR’s new Breaking Views blog, reminds us that New Zealanders used to have incomes rated amongst the highest in the world, but that over the years our standing has fallen. He explains that according to the International Monetary Fund’s data from 2009, “the top nation was Luxembourg with a GDP per capita of $78,559. The United States was fourth at $46,716, Australia 13th at $35,677, the United Kingdom 15th at $35,445, and New Zealand 27th at $27,027”. (Scroll down for the direct link to Mike’s excellent article “Between Rich and Poor” and th
ose of our other bloggers)

Without a doubt New Zealand is on a slippery slope from being rich to very poor, not because we are too small, too isolated or lack mineral wealth, but because successive governments have managed our economy badly. In fact, a country is no different from a household or a business – if you make poor quality spending decisions and do not have the gumption to cut back on waste and inefficiency, economic wellbeing will slip out of reach. The challenge to improve this situation and rescue the country from our slide is in John Key’s hands. He must forget about tinkering but be prepared to do what is right, not what is politically convenient.

The problem is that National has now taken a leaf from the former Government’s book and is now more poll driven than Labour ever w
as. The result is that the National Party leadership has become too obsessed with the reaction to reform rather than the benefits that will flow. That is a symptom of the fact that not enough effort has been made to enunciate and communicate the nation’s long-term goals, and in particular the importance of cutting government spending and balancing the books so that we can begin to improve our economic prospects – and close that widening gap with Australia. New Zealanders have shown in the past that we are not afraid of tightening our belts - just so long as the benefits of such restraint can be clearly seen.

To her credit, w
hen first elected Prime Minister in 1999, Helen Clark said that her objective was to raise New Zealand’s living standards into the top half of the OECD within a decade. But because she found the going more difficult than she had thought, Helen Clark abandoned the goal and let the country down. As a consequence our relative economic wellbeing deteriorated rapidly.

A first clear indication of how serious John Key is about lifting New Zealand’s performance will be seen in his speech to Parliament on Tuesday. The main indicator of course, will be in the 2010 Budget in May.  For the sake of our future, let’s hope John Key will meet the hopes and expectations of the nation when they elected him to lead the promised revitalisation.

NZCPR POLL
This week’s poll asks:
Would you support National making its election promise of catching Australia by 2025 a major priority?  
To vote click here>>> 
(Readers comments will be posted here>>> daily) 
View feedback on last week's poll here>>>


NZCPR BLOG
Breaking Views

FOOTNOTES
Articles can be found on the NZCPR RESEARCH PAGE - click here>>>
1.John Key, Speech from the Throne
2.Owen McShane, The Report of the 2025 Housing Task Force
3.2025 Taskforce Report, Answering the $64,000 question: Closing the income gap with Australia by 2025

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NZCPR Weekly is a free weekly
periodical from the New Zealand Centre for Political Research, a public policy think tank at www.nzcpr.com,
established in 2005 by former MP Dr Muriel Newman 

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NZCPR 
Commentary



REACTION TO THE REPORT OF THE 2025 TASKFORCE

Dr Don Brash

There has been widespread recognition that to raise our living standards to those of Australia by 2025 will require that growth in per capita incomes will need to double as compared with our past record – and that there isn’t the slightest chance of achieving that increase in our growth rate under “business as usual” policies.
We don’t need to have a company tax rate which is now well above the average of other OECD countries.  We don’t need to discourage people who have dependent children with effective marginal tax rates of well over 50%.  We don’t need to hobble our businesses with needless red-tape.  We don’t need to inflate the cost of housing by tightly constraining the supply of residential land.  Our government doesn’t need to squander capital in low-yielding but politically-popular projects.  And we don’t need a size of government that is materially larger than that in Australia.
.
..  

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Last Week's poll:
Do you agree with National's direction on race relations?
*Result: Yes 3%, No 97%
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THIS WEEK...

A RADICAL AGENDA

“We have no problem with Pakeha living on our lands, we invited them there. But the problems we have is when they basically ignore us and trample all over us, at which time we say okay enough’s enough, we want all of our land back.  You people can stay on it but so long as you acknowledge that we are the mana whenua and when we say to you that this is right and that is not right, that you listen to what we say”. 

Margaret Mutu
.[1]

Earlier this month Wikatana and John Popata, the two brothers who assaulted the Prime Minister at Waitangi Day last year, began an occupation on privately owned land in the coastal settlement of Taipa in the Far North. They say their presence there is designed to damage the value of a property that had been put up for sale to the point where it cannot be sold. They plan to stay there, with their dogs and mates, until all of the “stolen” land in the area is given back to their Ngati Kahu iwi at no cost.

Their long-term aim - for which they have the full backing of their elders - is to reclaim all privately owned land in the area for the iwi. In fact, the Ngati Kahu chief negotiator, Margaret Mutu, has gone so far as to publicly assert that because they are the “mana whenua”, private property owners in the area must do whatever Maori tell them to do.

In other words, Margaret Mutu - who holds a position of respect as a Professor of Maori Studies at Auckland University - is calling for the supremacy of Maori over non-Maori. By proposing that Pakeha become servants to Maori, Margaret Mutu is essentially promoting “apartheid” and in doing so is abusing the respect demanded by her academic position. She should not only be removed, but the Race Relations Commissioner should be investigating her racist calls.

This situation, where a whole community (which includes many retired pensioners) is being intimidated by radical Maori bullies - who have stated that they intend to destroy the value of their properties - is completely unacceptible. Instead of pandering to such radicals by officially recognising the tino rangatiratanga flag, John Key and his Government should be drawing a line in the sand and sending out a clear message that such behaviour will not be tolerated.

In the NZCPR’s new blog Breaking Views (located below, at the end of this commentary) author and historian Mike Butler concludes his article Mr Key and the flag of disintegration with the observation that “Mr Key’s unilateral decision on the flag is one example of how the current prime minister can make sudden changes that circumvent the process of representative democracy and which hugely promote the agenda of a tiny minority. By helping advance Maori sovereignty goals, Mr Key is giving approval to the increased disintegration of New Zealand society.”

In other words, while successive governments have enacted policies designed to appease Maori demands, they usually turn a blind eye to the radical agenda of Maori sovereignty activists. Not only will the decision by John Key to give official recognition to their flag on Waitangi Day be interpreted as a stamp of approval for the objectives of their movement, but the Prime Minister is ignoring the legitimate concerns and fears of mainstream New Zealand.

This country is already well advanced on the dangerous path towards Maori sovereignty. The bicultural project, enacted in the 1980s enabled Maori activists to infiltrate influential positions within the government service, through the creation of racial categories within state institutions.
[2] In spite of intermarriage over the years having blurred racial boundaries to the point where such classification is largely meaningless, the fact remains that claims of Maori ancestry now attracts substantial political and economic power. Nowadays however, with New Zealand being a multiracial society and New Zealanders increasingly wanting recognition - not for being of British, Maori, Asian, or some other heritage - but for being a New Zealander, biculturalism can be seen to be a stumbling block in the development of national pride and as such has gone well past its “use-by” date.

Then there is the on-going indoctrination of children: Dr Elizabeth Rata, Associate Professor of Education at Auckland University is particularly scathing about kaupapa Maori education with its “tino rangatiratanga political purpose”, describing it as “subversive” and “destabilising”.
[3] Maori propaganda is also now firmly entrenched in the new primary and secondary school education curriculum, despite  attempts to have it removed - it was dumped from the draft curriculum but was reinstated after  intense political pressure from vested interest groups. The mythical Treaty of Waitangi “partnership” concept now plays a key role in official education policy.

History has shown us that as governments make concessions to Maori rights activists their appetite for further reform grows. Not satisfied with past full and final Treaty settlements, they keep inventing new reasons to come back for new claims. The current demand for a slice of the estimated $350 million electromagnetic spectrum is a case in point. While there is no conceivable case for Maori to claim that spectrum is a treasured “toanga” protected under Article 2 of the Treaty of Waitangi, Maori have broadened their statement of claim to cover all such eventualities: “where
any property or part of the universe has, or may have, value as an economic asset, the Crown has no authority under the Treaty to possess, alienate, or otherwise treat it as its own property without recognising the prior claim of Maori rangatiratanga”.[4]

While this argument found sympathy with the biased Waitangi Tribunal who decided that Maori were entitled to a share of spectrum resources, when the Tribunal similarly found in favour of Maori claims to oil and gas reserves, then Prime Minister Helen Clark wasted no time at all in quashing the idea with a ruling that it was not in the ‘national interest’.

Essentially this ruling by Helen Clark, which was backed up by the Attorney General Margaret Wilson, means that grasping claims for public good resources like the spectrum, air, rivers, the foreshore and seabed, and the conservation estate, could all be rejected by a Prime Minister using the ‘national interest’ argument - should they choose to do so. At the present time, however, exercising constraint appears far from our Prime Minister’s mind as National continues to adopt Maori Party policy: inserting dangerously ill-defined Treaty principles into legislation, introducing race-based initiatives into the justice system, and committing an astonishing $1 billion of taxpayer’s money to progress the Whanau Ora programme, which will segregate the delivery of social programmes along racial lines. 

In this week’s NZCPR Guest Editorial, “National has no mandate for promoting racial separatism”, Treaty expert and law lecturer David Round challenges the National Party for pushing the country down a racist path:

“The Prime Minister and National Party have absolutely no popular mandate for promoting Maori sovereignty or racial separatism. National went into the election, as I recall, still with an official policy of abolishing the Maori seats. We all recognised that that was unlikely to happen; obviously, that policy had to be put on the back burner. Nevertheless, people voted for National under the distinct impression that they were voting for a party opposed to racial separatism; for a party, indeed, still sympathetic to Dr Brash’s Orewa speech. That trust in the Party has been betrayed”. To read David’s full article, in which he concludes that “We are building our own funeral pyre”, click the sidebar link>>>

David is right. Voters expected constraint from National but instead are witnessing a shocking escalation in racial initiatives, with more in the pipeline.

Of particular concern is the future of the foreshore and seabed. If National goes along with the demands of the Maori Party and grants customary title to Maori – it will only be a matter of time before free access to our beaches and the sea will be compromised, as well as hefty charges and levies being imposed on all commercial maritime operations.

Then there is the forthcoming “constitutional issues” inquiry, which was part of the Confidence and Supply Agreement between National and the Maori Party. The Maori Party has long campaigned on enshrining the Treaty of Waitangi into a New Zealand constitution. However, indigenous constitutions can pose very real dangers to modern societies – as the citizens of Bolivia discovered last year, when private property was nationalised by their new constitution!
[5]

Not only has the Human Rights Commission already started campaigning on giving the Treaty of Waitangi constitutional status - through its report on “The Status of Human Rights and the Treaty” (on which it is accepting submissions) - but it is also searching for new ways to push the Treaty partnerships concept “in central and local government, business, resource management, and environmental protection, in order to improve economic, social and cultural outcomes for all New Zealanders”.
[6]

Hidden somewhere in the shadows of the Beehive is the Maori Party’s demand for National to ratify the radical United Nations Declaration on the Rights of Indigenous Peoples - a treaty that even Labour Prime Minister Helen Clark refused to sign because of the dangers it posed to the stability of New Zealand. As a starter, under this treaty all land, private and public, would revert to the ownership of the “indigenous” people. But while National has justified their consideration of signing the treaty on the basis that it is not binding, that fact would get lost in clamour, as radicals who share the view of Maori Party Member of Parliament Hone Harawira - that white New Zealanders have ripped off Maori for generations - decide to take the land back. This would usher in the total degradation of race relations in New Zealand, with protests like the one at Taipa becoming common place.

National has a responsibility to the silent majority of New Zealanders – who no longer speak openly about matters of race for fear of being labelled racists - to reassess the dangerous game they are playing. They are implementing racist policies in order to hold onto the support of the Maori Party – just so they don’t need to rely on ACT. But each time they cede to the demands of the sovereignty activists in the Maori Party, they are taking us all a step closer to their ultimate goal of Maori supremacy – and that is an ugly place to be.

I will leave the final chilling words to a long-time campaigner for tribal sovereignty, Whatarangi Winiata, the President of the Maori Party (which thanks to National is now in government): “Failure by our nation to take steps... to change the management of our affairs and ways of governing ourselves, will create the circumstances where the fury of tino rangatiratanga will produce the true believers, namely, those who will die for the cause”.
[3]

NZCPR POLL
This week’s poll asks:

Do you agree with the direction on race relations that National is taking?
To vote click here>>> 
(Readers comments will be posted here>>> daily) 
View feedback on last week's poll here>>>


NZCPR BLOG
(Note: please click the logo or column titles to visit the blog and comment)

Breaking Views

FOOTNOTES
Articles can be found on the NZCPR RESEARCH PAGE - click here>>>
1.RadioNZ, Protestors plan to build on occupied land
2.Elizabeth Rata, Brokerage Politics and the Rise of Neotribal Capitalism
NZ Political Review, Spring 2004
3.Elizabeth Rata, Belonging to New Zealand
Teachers Refresher Course Conference, Wellington 2007
4.Waitangi Tribunal,
Radio Spectrum Management and Development Final Report 5.RadioNZ, Indigenous Constitutions: Bolivia today, Aotearoa tomorrow?
6.Human Rights Commission, Status of human rights and the Treaty

NZCPR ADMIN
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NZCPR Weekly is a free weekly
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established in 2005 by former MP Dr Muriel Newman 

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NZCPR 
Commentary



NATIONAL HAS NO MANDATE FOR PROMOTING RACIAL SEPARATISM

David Round

We are building our own funeral pyre.
The Treaty asserts the sovereignty of the Crown, yet even judges declare that the Treaty involves some form of partnership of Crown and Maori, and now we are giving official countenance to some completely undefined Maori sovereignty.
The Treaty asserts equality before the law ~ Maori are to be British subjects like any other ~ yet it is now a pretext for racial privilege and taxpayer generosity on an ever increasing scale.
The further concessions we make and generosity we show to Maori every day do nothing but fuel demands for more.  
The Treaty, as interpreted and implemented, is undermining democracy, social cohesion and economic progress.
The way things are going, if we do not destroy the Treaty industry we shall destroy ourselves.
I am reluctantly forced to the conclusion that unless a stop is put to this madness soon New Zealand as a nation is doomed.
..  

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lcid:image014.gif@01C7A844.ED724540POLL RESULT
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Do you support a land tax of 0.5% of the unimproved value of a property?
*Result: Yes 2%, No 98%
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THIS WEEK...

LESS TAX NOT NEW TAX WAS THE ELECTION PLEDGE

The Tax Working Group released its report on proposed changes to our tax system on Wednesday to a respectful response from the government. This is in sharp contrast to the dismissive reaction the 2025 Taskforce received to their report on ways for New Zealand to catch up with Australia.

The difference of course, is that while the terms of reference of the Tax Working Group were tightly controlled by the government, those of the 2025 Taskforce were not. This enabled the 2025 Taskforce to take a comprehensive approach and recommend some game changing options. Prime amongst these was their suggestion that government spending should be reduced back to 2004 levels so that taxes could be cut to 20 percent: “Cutting core Crown expenses to 29 percent of GDP would, for example, allow the maximum personal tax rate, and the company and trust tax rates, all to be reduced to 20 percent”.[1]

This suggestion, which would transform New Zealand’s future, did not go down well with the Key Government, which seems inexplicably wedded to the former Labour Government’s reckless spending programme. Even the Secretary of the Treasury, John Whitehead, has criticised the present level of government spending, estimating that an astonishing 65 percent – some $40 billion – of the government’s $62 billion budget is of a questionable quality. What this means is that those who are critical of a reduction in government spending should be reminded that according to the expert, more than two-thirds of all taxpayers’ money is being spent in an inefficient or wasteful manner.

When the Tax Working Group was set up last May to undertake a strategic review of the tax system, a strong caveat was imposed. The Group was tasked with finding sufficient alternative sources of tax to compensate the government for the revenue loss associated with aligning the top income taxes, corporate taxes and trust taxes at 30 percent. In other words, the whole exercise had to be “revenue neutral”. And that’s the rub. This was not a “blue skies” review of our tax system in the sense of a panel being free to examine the way our taxes are structured, collected and spent. Instead they were constrained by the need to find more cash. Any analysis of government spending levels was completely off limits.

The Tax Working Group concluded that our tax system, which back in 1989 had been heralded as one of the least distortionary in the OECD - with internationally competitive tax rates - has now become “incoherent, unfair, lacks integrity, unduly discourages work participation and biases investment decisions”.[2] The burning question is how on earth has the situation deteriorated so quickly?

The answer, as explained by this week’s NZCPR Guest Commentator Roger Kerr of the Business Roundtable, is “Michael Cullen”!

“The rot began with the first decision to raise the top personal income tax rate from 33% to 39%.  This move was unnecessary (the government did not need the extra revenue), it increased economic costs (high marginal tax rates are most damaging to growth), and an apparently simple move increased the complexity of the system (some 50 pages of new tax legislation were needed to implement it).

“Subsequent moves by the Clark-Cullen government had similar effects.  The Working for Families scheme increased effective marginal tax rates, with the abatement rate of 30% (now 20%) being added to the 33% and 39% personal tax rates.  Several new distortionary tax concessions were introduced, ranging from KiwiSaver subsidies to racing industry tax concessions.  The Portfolio Investment Entity (PIE) schemes further fragmented the income tax system.  And while the cut in company tax to 30% was a positive move, the top personal rates were not reduced at the same time, which increased incentives to shelter personal income in company structures.”

With most of Dr Cullen’s changes to the tax system going against the advice of tax experts at the time, Roger Kerr has found the criticism of them by the Tax Working Group unsurprising. In fact, he concludes that the report itself is “over-hyped”. To read Roger Kerr’s excellent analysis of the report, click the sidebar link>>> [Please note that more commentary on the Tax Report can be found on the new NZCPR Blog "BREAKING VIEWS" below]

The point is that whichever way you slice and dice it, the New Zealand Government is spending too much money and New Zealanders are paying too much tax. In other words, the government sector has grown so big it is impoverishing the country.

The numbers tell the story.

In 2004, core government spending amounted to 28.9 percent of all economic activity in New Zealand (GDP). However, as a result of a spending spree by Labour - as well as the effects of the recession and the decision by National to continue on with much of that wasteful spending - core government spending has now reached 36.7 percent of GDP.

If local government activity is factored in the outlook is increasingly bleak. According to the OECD, in 2004 the combined spending of local and central government in New Zealand was 38.6 percent of GDP. Australia in comparison was lower at 35.1 percent. Nowadays, spending by the New Zealand government sector has blown out to 45.1 percent of GDP, while in Australia it has dropped back to 35 percent!

It is a clear point of difference between our two countries that across the Tasman, the government sector is being held in check, while in New Zealand, it is growing like topsy, dominating almost half of all of the country’s economic activity. We tend to forget that governments don’t create wealth – they consume it! That means that every dollar they spend is a dollar that must be collected from those who create it. With big government squeezing private sector wealth creators, it is little wonder that not only is our economy so fragile, growth so slow, and prosperity so elusive, but that a steady stream of Kiwis leave our shores for more benign tax environments overseas.

Whether National likes it or not, it is the massive rate of expansion of government in New Zealand and the inextricably linked rise in taxation, that is is the root cause of our economic problems. And since the Tax Working Group was prevented from exploring this point, the tax debate has been forced to focus on new ways of plundering taxpayers. Surely it is time we collectively said enough is enough and supported the introduction of a cap on government spending like they have in Hong Kong. There, government spending is capped at 20 percent – by convention – and the country prospers, with wealth creators rather than wealth consumers dominating the economy.

While introducing such a cap on government spending would clearly need to be a staged process, the fact that National (which argued vehemently against excessive government spending during the nine years it was in opposition) is searching for new taxation avenues instead of cutting spending sufficiently to stimulate the economy, demonstrates that they cannot be trusted to constrain spending voluntarily. That means a cap on spending may be the only way to protect taxpayers and ensure our long term economic progress.

There is something extremely distasteful about the slippery politics being employed in this debate about tax. When the public vote for a government that is promising tax cuts, they believe that it signals a lowering of the total tax burden. National certainly didn’t explain on the campaign trail that they were promising income tax cuts on the one hand, and new taxes on the other.

What is also especially disappointing is the way in which National has started to use the old socialist technique of “divide and conquer” to try to demonise property investors so they can justify penalising them with new tax increases. But their arguments don’t wash.

If the Tax Working Group had included property experts on their panel, they could have put the record straight on a number of misapprehensions about property investment. Firstly, there already is a capital gains tax on property for any investor who buys with the intention of selling for a quick profit. Secondly, the debate about depreciation fails to mention that it is a timing issue. Should the asset appreciate in value not depreciate, then the depreciation expense deductions are reclaimed by the IRD at the time the asset is sold.  Thirdly, claims have been made that New Zealand investors are over-indulging in property solely for tax advantages. Again, this argument does not hold water.

As property expert Frank Newman wrote for the NZCPR in Taxing Matters, “While tax undoubtedly plays a part, property investment is popular for a number of other reasons. Firstly, it has provided better long-run returns than the alternatives! According to the Real Estate Institute housing price index, residential prices have returned 11.8% a year over the last 17 years, compared with a 7% for New Zealand shares. Secondly, and most critically, people will only invest in things they trust. The Sunday Star Times recently reported the findings of a survey of 1200 people who were asked to rate the level of trust they have in sharebrokers, financial advisers, fund managers, mortgage brokers, insurance advisers, and banks. Only banks scored in positive territory which points to a confidence crisis in the funds management and sharebroking industries. These issues are never factored into the comments of the central bankers, politicians, fund managers and academics who so frequently scold us for “over-investing” in property, and for these reasons property is likely to remain the most preferred long-term investment for New Zealanders.”

There are around 340,000 private rental dwellings in New Zealand, many owned by mum and dad investors who have put their savings into rental property as part of their retirement plan. Any decision by John Key and National to punitively punish these people – because the government can’t get its own spending under control – is contemptible. As is any further attempt to politically portray them as pariahs.  

All in all, the Tax Working Group report has served a useful purpose in pointing out that too much of the tax collected in this country is of a form that discourages growth and wealth creation. And while correcting that is a laudable goal, the real answer to our tax problem is that we simply pay too much. Lowering and flattening the tax structure in conjunction with the government’s elimination of wasteful and inefficient spending, is the way to prosperity in New Zealand – not introducing land taxes nor any of the other devious suggestions being touted.

NZCPR POLL
This week’s poll asks:
Do you support the Tax Working Group’s recommendation to introduce a land tax of 0.5 percent of the unimproved value of a property?
To vote click here>>> 
(Readers comments will be posted here>>> daily) 
View feedback on last week's poll here>>>


 NZCPR BLOG - click heading or columns to visit blog & comment

Breaking Views

FOOTNOTES:
Articles can be found on the NZCPR RESEARCH PAGE - click here>>>
1.2025 Taskforce Report
2.Tax Working Group Report

NZCPR ADMIN
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984, Whangarei.

NZCPR Weekly is a free weekly
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established in 2005 by former MP Dr Muriel Newman 

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NZCPR 
Commentary



TAX WORKING GROUP REPORT OVER-HYPED

Roger Kerr

The unstated but implicit bottom-line message in the Tax Working Group report is,
‘It’s the spending, stupid’
. 

Only by focusing on reducing the government spending share in the economy (which is well above that in Australia, let alone the much lower levels in higher income countries such as Hong Kong and Singapore), can New Zealand simultaneously achieve sound public finances, meaningful tax reform and strong economic growth
.
..  

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NZCPR Weekly                                                                              

Dear NZCPR Weekly Readers,

I hope you and your family have had a great Christmas and New Year.


Thanks so much to those who sent in donations over the summer break to help keep the NZCPR going this year. As we provide a free service, we depend entirely on voluntary donations from our newsletter readers. We cannot exist without your support. Since the recession has made things pretty tough,
your help is greatly appreciated (if you would like to visit our donation page, please click here>>>).

As you will know, this year we are running a fundraiser function at Alan Gibbs world famous sculpture park. If you are planning to come along but haven’t yet registered, I would advise you to do so soon, as spaces are fast filling up (to visit the website to find out about the Great Day at the Farm and register, please click
here>>>). Between now and the fundraiser I will be featuring our generous sponsors on our newsletter and website, so if you are able to support them, we would be very grateful.


2010 is going to be a big year politically as a number of controversial policies come to the fore. I would like to make an appeal to you – this year, if you feel strongly about an issue, please let our Members of Parliament know. In a democracy, MPs are influenced by public opinion – and the more people who speak out, the greater the notice they take!

These NZCPR newsletters, which are also sent to MPs, policy makers, journalists, and other opinion leaders, are designed to be a catalyst for public action. With your help in sending them on to others in your address books, we are able to utilise the power of the internet to collectively become a potent force for change - and when you read this newsletter you will see that this year’s first call to action starts today!
 

Thanks again for your interest in the work of the NZCPR and for your support – and my very best wishes for 2010.

Kindest regards,
Muriel
Dr Muriel Newman
Director New Zealand Centre for Political Research
 

THIS WEEK...

THE MMP REVIEW - trashing our democratic rights

It can be argued that the announced referendum on MMP, to be held in conjunction with the 2011 general election, is one of the most important constitutional reforms undertaken by any New Zealand Government. Yet, while there is “lofty” talk about the need for public consultation – “We want to ensure that everyone has the opportunity to have their say on this significant constitutional issue” – it is clear that the government is not serious about public input.[1]

The consultation process that has been chosen involves nothing more than the standard public submissions to a Select Committee. As we have already seen from this government’s farcical submission process regarding the emissions trading legislation, not only is there little chance that such submissions will have any effect,
submitters are likely to be denied the opportunity to make their submission in person.    

This scant intended public consultation process is in spite of a well established convention that whenever constitutional reform is undertaken, widespread public involvement is encouraged. The Cabinet Manual states it clearly - with regard to changes in our constitutional arrangements, “It is important for a process of change to involve a sound process, public education, proper consultation with affected parties, public buy-in and plenty of time.”
[2]

What this means is that unless we demand to be properly consulted over the structure of our electoral system - which is fundamental to the constitutional arrangements of the country - National again intends to snub the rights of people to have a meaningful say.

So what is the Government proposing for this crucial review of MMP?

The process goes something like this.

A referendum bill will be introduced into Parliament in March, which will include two questions – firstly, whether the current MMP voting system should be retained, and secondly, for those who would like to see change, which voting system they would prefer. A list of options will be provided, which is likely to include first-past-the-post, preferential voting, supplementary member, or single transferable vote. The Bill is scheduled to be passed in late 2010 with the indicative referendum on MMP held at the 2011 general election.


If a majority of voters want to see MMP replaced, then a binding referendum will be held at the 2014 general election between MMP and the preferred alternative. If MMP is defeated, the new voting system will be introduced and used for the first time at the 2017 election! This means that our Prime Minister - who has strongly indicated that he thinks MMP is working well - has approved a process that will retain MMP until at least 2017. This is in spite of recommendations in the Cabinet papers for options which would see a new voting system in place in time for the 2014 election.
[3]

To complicate matters further, the Cabinet papers have also suggest that the government might like to consider announcing modifications to MMP in order to make it more palatable to voters: “In the lead-up to the first referendum, the public discussion concerning whether to retain or change the current voting system is likely to bring to light a number of issues that people have with MMP (eg, the party vote threshold). It may be useful during this public discussion for the Government to indicate whether it would be willing to undertake a review of MMP to clarify and address these issues, if the public votes to retain MMP. This would assist voters to make an informed choice. It would also reduce the likelihood of change from MMP to an alternative voting system if most voters generally agree with MMP, subject to some amendments”. While the government has remained silent on whether it intends to pursue this course of action, doing so could expose it to accusations of gerrymandering the referendum process.


All in all, the proposed referendum process can be seen to be deeply flawed.

Firstly the timeframe for the implementation of a new system – if that’s what the public wants - is far too long. If the public vote for change in 2011, a binding referendum should be held in 2012 so that if MMP is defeated, the new electoral system can begin at the 2014 election.


Secondly, there needs to be a proper public consultation process instead of the sham that’s being proposed. Voters can tell whether
governments really mean it when they say they want to “engage” the public, by looking at the proposed process. If a government goes to the trouble of setting up an independent Commission – Royal or otherwise – with terms of reference that involves widespread public consultation around the country, then they are genuine. If they set up a series of meetings around the country for Ministers and MPs, then at least they are prepared to put on a good show. But when they resort to a Select Committee process on a bill (which is what the government is intending in this case) then you know they are simply paying lip service to the concept of public consultation.

What should be happening is that the government should be using this year to consult widely, going up and down the country properly engaging the public in the constitutional change process. There would still be ample time for a referendum bill to be introduced into Parliament in early 2011 and passed before the election.

Thirdly, it appears that no provision has been made for some form of preferential voting on the preferred options to replace MMP. Without a preferential vote, it could be that there is no clear winner. A preferential vote would also help to ensure that voters weigh up the pros and cons of each voting system alternative and rank them in the order that they prefer.


These are all matters of process that expose the fact that National’s consultation is intended to avoid change, and by retaining the status quo, accommodate the interests of its coalition partners. The Cabinet papers also indicate that there is a strong desire to avoid any robust discussion on the future of the Maori seats. For a party that campaigned hard on abolishing the Maori seats right up until John Key became Prime Minister and jumped into a cohabitation liaison with the Maori Party, this turnaround is an indictment. No matter what cosy arrangements the present government has put in place, the referendum on our voting system is a far bigger matter that must involve this crucial Maori seat issue - especially since the 1986 Royal Commission on the Electoral System recommended that the Maori seats had passed their used-by date and should be abolished.


In fact it is this cosy deal-making between political parties with little regard for the overall good of the country that has been a driving force in the desire of many voters to ditch MMP. After 14 years of watching disgraceful conduct, with parties “bought off” with taxpayers’ money in return for supporting dodgy laws, the public have had enough. The latest fiasco involving Nick Smith rushing his emissions trading law through Parliament so he could look good at Copenhagen was a final straw. The backroom deal that he did with the Maori Party enabled wealthy Maori corporations to rub their hands all the way to the bank, while the public now stands exposed to the re-opening of Treaty settlements that have previously been classified as full and final.

Then there is the vexed issue of large numbers of list MPs in Parliament who are not accountable to the public but to Party bosses and are, in effect, MPs by appointment rather than election
- as is the pretence. It has been said that if there were no list MPs, the controversial smacking bill would never have been passed, as MPs would have been much more in tune with the views of their electorates.

Given the fact that the voting system is now under review, one of the “burning” issues that should be considered is whether New Zealand voters would like to see the size of Parliament reduced. In 1999 Margaret Rob
ertson’s Citizens Initiated Referendum calling for a smaller Parliament of 99 MPs received 81.5 percent support. Yet in the intervening years nothing has been done to progress this. The forthcoming referendum on MMP would provide an ideal opportunity to dovetail in the move to a smaller Parliament. 

There is another, bigger constitutional issue that is gaining traction that should also be canvassed at this time. It is the fact that New Zealand’s one-House Parliamentary system leaves citizens vulnerable to exploitation
. If a government cobbles together the numbers to pass bad law that has the potential to be hugely detrimental to our future well-being as a nation, there is nothing we can do about it. Unlike many other nations, New Zealand has no legislative watchdog body in the form of an Upper House to question the public good value of legislation and if necessary, stop it. We used to have an Upper House, of course, called the Legislative Council, but that was abolished in 1951.

While this whole global warming debacle has been playing out, it has been particularly interesting to see that in spite of the demands of political leaders, the Upper Houses in Australia and the United States have steadfastly refused to pass emissions trading laws
. By doing so, they have thus far protected their citizens from the disastrous economic damage such taxes would impose. Maybe it is time for New Zealand to have a watchdog body too. If we had a small Upper House of say 20 elected Members to compliment a Parliament of say 79 electorate MPs, this could be just the sort of constitutional reform that would take New Zealand forward positively – protecting us from unwise political excesses, while reducing the total size of Parliament down to 99 MPs.

Graeme Hunt, an Auckland-based writer and historian, who has campaigned strongly against MMP, is this week’s NZCPR Guest Commentator. Graeme explains that “G
ood democracy should be simple: voting should be easy, outcomes should be transparent and turnout should be high. MMP fails on all counts but there are concerns in some quarters, even among those who oppose MMP, that a return to the old days of a powerful executive with a legislative iron grip on a single House of Representatives is not the way to go.”

In his article, Graeme outlines the history of New Zealand’s Upper House of Parliament and concludes, “Sadly, although there might be a good case in New Zealand for a house of review, it is unlikely to come about. The only way it could be sold would be if the membership of the House of Representatives were reduced to, say, 99 MPs – something overwhelmingly endorsed by Margaret Robertson’s citizens-initiated referendum in 1999.

“I suspect most Kiwis, if they had to, could live with a small upper house elected by STV and a lower house elected by FPP, provided the upper house had standing. The Legislative Council did not have standing but the Australian Senate, which is elected by STV, does, as does the Australian House of Representatives, which is elected by preferential voting”. To read Graeme’s full article click the sidebar link>>>

All in all, if you feel you are being sold short on the constitutional review of New Zealand’s voting system by the process that National has proposed, then you need to do something. To paraphrase the wise words attributed to Edmund Burke, Bad things happen when good people do nothing!

In a democracy change will only take place if there is sufficient public pressure. So let the Prime Minister know how you feel about the MMP review he has authori
sed – to email John Key, click here>>> and write your message. Let’s start 2010 off with a roar!

NZCPR POLL
This week’s poll asks:
Are you satisfied with the MMP Review Process as outlined by the Government?
To vote click here>>> 
(Readers comments will be posted here>>> daily) 
View feedback on the biggest issues facing NZ in 2010 here>>>

FOOTNOTES:
Articles can be found on the NZCPR RESEARCH PAGE - click here>>>
1.Simon Power, MMP referendum to be held at 2011 election
2.Cabinet, New Zealand’s Constitution
3.Cabinet Considerations on MMP Referendum

NZCPR ADMIN
Please forward this newsletter on to your own networks and encourage other people to subscribe - that's how we grow. 

To help support the publication of these newsletters and receive your free EBOOK and unlimited access to our website Forum click here>>>

To join the mailing list for this free newsletter please click here>>>


Why not submit your burning issue for publication on our website Soapbox Series
?

If you enjoy political debate visit the Debating Chamber forum - many of our forum subscribers post up information for the public to view daily.


To contact Muriel about this week’s column please click here>>>. You can reach Muriel by phone on 09-434-3836, 021-800-111 or post at PO Box
984, Whangarei.

NZCPR Weekly is a free weekly
periodical from the New Zealand Centre for Political Research, a public policy think tank at www.nzcpr.com,
established in 2005 by former MP Dr Muriel Newman 

If you have a change of address, please note your old address and your new one and click here>>>. To unsubscribe, please click here>>> and send. 

(Please note - if you get back a message saying the address is not on the mailing list, it means you are subscribed under a different address and you will need to submit that one)

NZCPR 
Commentary



A STEP TOWARDS CONSTITUTIONAL REFORM
G
raeme Hunt

Had an upper house been elected by STV in 1914, the “balance” in the electoral system people demanded then and probably want now, and the necessary check on the powers of the executive, would have been in place. Preferential voting for the lower house would have been the icing on the electoral cake...  

To read click here>>>


 

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NZCPR Weekly                                                                              

CHRISTMAS GIFT IDEAS FROM THE NZCPR
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THIS WEEK...

Two Flags, Two Peoples, A Divided Nation 

New Zealand has a lot to be proud of but there are some aspects of life ‘down under’ that we would prefer not to mention. Near the top of that list is racism.

Racism is alive and well in New Zealand. That is, anti-white racism of the sort recently made public by a Member of Parliament. In claiming that ‘Whities’ had been ripping off Maori for centuries, MP Hone Harawira exposed the underlying attitude that drives the Maori sovereignty movement - along with its beneficiaries the Treaty of Waitangi gravy train and indeed the Maori Party itself. This undercurrent of anti-white racism has existed for years but remains one of those truths that most are reluctant to admit and that few have the courage to address.

The New Zealand Centre for Political Research has never shied away from this issue. It is too important to ignore - it’s at the heart of how we feel about our country and is critical for our future.

Unfortunately the Maori rights movement with its assertion of racial privilege has grown strong as a result of the actions of politicians who have been prepared to sacrifice racial harmony on the alter of electoral support. Those individual MPs in government, who have persuaded their colleagues to support Maori rights over the rights of all other New Zealanders to equality before the law, have done the country a grave disservice. As a result of their lack of courage a bloated grievance industry continues to fuel the growing racial divide.  

The reality is that over a thirty year period, the Treaty of Waitangi settlement process, introduced to address historic grievances between Maori and the Crown, has been captured by the Maori elite. Many claims have received multiple ‘full and final’ settlements, each one becoming increasingly generous.

To its credit, Helen Clark’s Labour Party said enough is enough and introduced a cut off date for historic claims. But to its shame, John Key’s National Party has now put the whole concept of full and final settlements at risk. As Phil Goff, the Leader of the Labour Party explained in a speech last month, National’s desperate deal to buy Maori Party support for its emissions trading scheme, has resulted in five Maori corporations being able to re-open their “full and final” settlements. This will have set a precedent for the creation of “a permanent class of ‘post-Treaty asset’ - Assets that were once part of a Treaty settlement would forever be eligible for compensation if they were ever affected by adverse decisions by government. If the government ever changed the rules relating to forestry, or tax law, or the exchange rate, here is now a precedent for having to compensate the owners of an asset that had once been part of a Treaty settlement. That’s a bad principle. Full and final settlement would become impossible.”[1]

In contrast, when Don Brash was leader of the National Party, he tackled the growing racial divide head on by declaring that the Treaty should not be used as the basis for creating greater civil, political or democratic rights for Maori than for any other New Zealander. He pledged that National would complete the settlement of historic claims, remove all references to race from legislation (including the undefined “principles of the Treaty”), and abolish the Maori seats.

The response from the public was overwhelming. They were hungry for leadership. They wanted someone to put a stake in the ground and halt the slide to separatism. During his time in Parliament, Winston Peters also consistently stood against Maori privilege, as has ACT. Even Helen Clark occasionally drew a line, preferring to meet Shrek the sheep than the ‘haters and wreckers’ who led the foreshore and seabed hikoi to Parliament.

Incredibly, John Key has now embraced the party that believes that white man should be kicked out of New Zealand, and under John Key’s direction National is now assisting Maori to advance its racial agenda.

Just last week the Minister of Treaty Negotiations, Christopher Finlayson, signed an agreement with Ngati Porou which has been described as “a return of sovereignty to Ngati Porou”.[2] The settlement includes $110 million in cash, ownership of almost 6,000ha of conservation reserves and parks - including forests, scenic and wildlife reserves, hot springs and boat ramps - the right to buy 21 schools and 5 police stations which the Crown would then lease back, the option to buy any state house in the area that Housing New Zealand might want to sell, and the right to “enhance influence” on Gisborne District Council resource management decision-making that might affect the iwi.

In spite of Tuhoe agreeing to a “full and final” settlement of £100,000 in 1958, they are back at the negotiating table pursuing their agenda of “self government”. According to the Herald, Treaty Minister Christopher Finlayson is “keen to keep a lid on public opinion”, especially regarding those government functions that could be devolved to Tuhoe, which include health, building, education, local government and the environment, while tourism, justice, welfare, culture, arts and heritage, taxation and Maori development are proving more problematic! Tuhoe are also demanding full ownership of the 212,000ha Urewera National Park.[3]

The Gisborne Herald recently exposed that the real concern of East Coast tribes over the proposed changes to the foreshore and seabed legislation is that they might miss out on the getting their hands on the riches: “
As you’re aware, there are a lot of oil and minerals in the seabed and if you ask us, that’s what the Foreshore and Seabed Act is all about. Our primary position is affirmation of ownership, but if we can’t get to that, compensation. The amount of resources out there would make the fisheries deals pale in comparison — we’re talking some fantastic amounts that would help with our economic salvation.”[4]

These tribes are also extremely keen to see John Key ratify the United Nations Declaration on the Rights of Indigenous Peoples as they have already
been planning how they will use it to create another lucrative opportunity to squeeze taxpayers: “A simple solution to any vacuum left by the repeal of the Foreshore and Seabed legislation was for the Government to ratify the Declaration on the Rights of Indigenous Peoples. When you read that declaration, it gives those people the right to veto laws, the right to royalties over minerals. When you boil it down, it’s really just an extended version of Article 2 – Tino Rangatiratanga. If the Government binds itself to that declaration, it’s not law, but at least we can build some sort of regime that is similar to implementing our Article 2 rights.”

What motivates these acts of racism is not a desire for equality – it is self interest and greed wrapped in a cloak of mana and customary rights. Where modern Maori differ from their waring tribal ancestors is in their unity. They have a common flag and a common enemy.

And that is why the public at large will show absolute disgust and contempt when on February 6th the Maori sovereignty flag will be flown from the Harbour Bridge, Premier House and many other government buildings. These two sovereignty flags – that of New Zealand and that of Maori Treaty rights - will represent the divided nation that New Zealand has become.

David Round, this week’s Guest Commentator, puts it like this: A nation’s flag is a precious thing. It arises out of a long history; it grows with a people and tells their story. The New Zealand flag is no exception. On the blue of the Pacific Ocean shines the Southern Cross, the great guiding constellation of our skies, and in one corner the crosses of St George, St Andrew and St Patrick ~ England, Scotland and Ireland ~ tell of our British ancestors ~ the explorers and pioneers who found New Zealand a barbarous, albeit beautiful, wilderness of warring tribes, and created by their patient heroic labours the land of peace and comparative prosperity we have inherited. Certainly, there is nothing specifically Maori here, and it might be nice if there were, although Maori crossed the blue Pacific guided by the stars, and all Maori, after all, have British ancestry, even if they prefer to ignore or deny the fact; but this is our flag. It is a pretty accurate reflection of our nation and of the traditions and ideals which have shaped and made us and, until recently anyway, inspired us. We shall need those ideals again in future.  It is perhaps a bit of an accident of history, but then so are many things. We have never been a great flag-waving nation; we are an undemonstrative, laconic people; but all the same, this is what we are. Our ancestors, Maori and British, have fought and sometimes died for it. A flag is not just a pretty piece of cloth. It is not just a corporate logo; it is not just ‘a symbol’. It is more than that; and that is why the Prime Minister’s decision that the Maori sovereignty flag will fly from Parliament, Premier House, government buildings and the Auckland Harbour Bridge next Waitangi Day is so foolish and ominous a sign. To fly the flag of a movement dedicated to the dismantling of our country shows how foolish and blind we have become. The Maori sovereignty flag is the enemy of the flag it will be flying next to”. To read David’s article, click the sidebar link>>>

It is tragic for New Zealand that John Key’s National Party is so obsessed with pleasing everyone that it appears to be blind to the agenda of radical Maori and naïve in allowing this escalation of racial division under its watch.

Incredibly the National Party has advanced the Maori sovereignty agenda much more than the socialist Labour Party did. That will prove disastrous for the future of New Zealand and I’m sure will be a huge disappointment to many of those who voted for National at the last election.

At a political level, the actions of the National Party have re-opened the door to the return of Winston Peters – who has consistently argued against racial division and the prevailing partnership myth of the Treaty of Waitangi. It also re-exposes National’s right flank to gains by the ACT Party, should ACT choose to pursue this issue and wrestle away votes that would otherwise go to New Zealand First.

The racism debate needs to be discussed openly and honestly, and without fear or favour. We need to ask which of two paths New Zealand wants to go down. The first is the path of the Maori sovereignty movement that looks to a future shaped by indigenous rights. We know from the experiences of Zimbabwe and South Africa where that path leads.

The alternative path – desired by most New Zealanders – respects indigenous culture but rejects tribalism and privilege for our so-called indigenous population.

Most people want the grievance gravy train to stop. Most people know the train has become a billion dollar industry that has gone beyond righting the wrongs of the past, and most can see that the motivations are now largely selfish.  

What is particularly disturbing in all of this is that John Key and his National Party either don’t see it, or are prepared to turn a blind eye because it suits them to do so.

NZCPR POLL
This week’s poll asks:
Should the Maori sovereignty flag fly alongside the New Zealand flag on Waitangi Day?
To vote click here>>> 
(Readers comments will be posted here>>> daily) 
To view last week's comments click here>>>

NZCPR Columnists

Ron Smith: NUCLEAR CARGOES
Earlier this year, advanced notice of a shipment of Mixed Oxide Fuel to Japan caused a familiar flurry of ostensible anxiety from Greenpeace, which was uncritically reflected in the media. more>>>
Mike Moore: GREEN POLITICS - A RELIGIOUS MOVEMENT 
It’s finally happened. A British judge has determined employees can take employers to court on the grounds that they were discriminated against because of their views on climate change... more>>>

Allan Peachey: SCHOOL FOR DISRUPTIVE KIDS TO CLOSE
Youngsters with significant behaviour problems need to be in highly specialised schools with teachers who are highly trained in dealing with them. I have seen some great successes overseas ... more>>>

http://www.nzcpr.com/Admin/RonAvatar.jpg Ronald Kitching: NATURE OF ECONOMIC ACTIVITY - part 2
To decide whether an undertaking is sound we must calculate carefully whether to use a waterfall to produce electricity or extend coal-mining and better utilise the energy contained in coal...
more>>>

FOOTNOTES:
Articles can be found on the NZCPR RESEARCH PAGE - click here>>>
1.Phil Goff, Nationhood
2.Herald, East Coast iwi weigh up $110m cash offer
3.Herald, Tuhoe discusses areas of self-government
4.
Gisborne Herald, What comes next after seabed Act?

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established in 2005 by former MP Dr Muriel Newman 

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NZCPR 
Commentary



THE ENEMY OF NATIONHOOD

David Round

It is a depressing indication of the madness now an unquestioned part of our national life that those calling for racial equality and respect for the rights of all, including the foreshore and seabed as our common heritage, are automatically condemned as racist. New Zealand is indeed a deeply racist country. But the racism lies in a race-based political party, racially-selected Parliamentary seats and members, a special racial electoral roll, race based sports teams, schools and units within schools, television stations, government departments, trusts and financial assistance galore, legal recognition of racial privilege, treaty indoctrination on every conceivable occasion. Universities now have special Maori graduations. No public ceremony in our secular country is complete without Maori elders and karakia. Every new appointee in the public service is welcomed with a powhiri…..None of this is diminishing. It is growing. We are not working towards becoming one nation. We are walking in completely the opposite direction...  

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NZCPR Weekly                                                                              

 You are invited to the NZCPR's special event:
THE GREAT DAY OUT AT THE FARM
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THIS WEEK...

The Copenhagen Saga 

From the 7th of December through to the 18th, the much publicised United Nations Climate Change Conference will be held in Copenhagen, Denmark. The main aim of the conference is to reach an agreement on a framework to replace the Kyoto Protocol when it expires in 2012. Attending the conference on behalf of New Zealand will be the Minister for Climate Change Nick Smith, his Associate Tim Groser, and a contingent of officials. In addition, as one of the concessions to the Maori Party for their support of the emissions trading scheme, taxpayers will also fund two iwi leaders and kaumatua to travel to the Copenhagen conference.

Few details about the cost of the proposed treaty have been disclosed. In 2001, when New Zealand signed the Bonn Declaration, we were amongst 20 industrialised countries that pledged millions of dollars a year to help developing countries tackle climate change: "We are prepared to contribute $410m, which is 450 million euro, per year by 2005 with this level to be reviewed in 2008." However, this has turned into a debacle according to the BBC, with no proper record of what money has actually been paid, a
nd large sums that cannot be accounted for.[1]

The stakes are higher now. The global warming scaremongering machine has been so successful that developing countries at Copenhagen will be asking nations like New Zealand to front up with an estimated $250 billion to tackle climate change – and according to some sources, that could be each and every year!

The details of what is being proposed at Copenhagen can be found within a document penned by the UN Framework Convention on Climate Change working group.[2] This virtually impenetrable 181 page draft contains a bewildering array of negotiating options. However, what stands out is that the bottom-line purpose is money, power and control!

Through this Copenhagen treaty, the United Nations wants countries like New Zealand to agree to ambitious emission reduction targets (up to 95 percent of 1990 levels by 2050 is one of the targets being proposed), to provide huge financial support to developing countries for the purpose of adaptation, mitigation and compensation, and to support the establishment of a proposed new governance body.

The problem for New Zealand is that the decision to support such
binding treaties - which could have enormous implications for the future prosperity of New Zealand - is taken solely by the Executive of Government, rather than by Parliament as a whole. And while a procedure has been established whereby a “National Interest” analysis of some proposed treaties must be presented to a select committee of Parliament, that is as far as it goes.[3] If however the treaty involves a domestic law change then the proposed legislation must, of course, go through the normal parliamentary process.

Our arrangement
s contrast with what occurs in other countries such as the United States, where the Constitution requires the approval of a two-thirds supermajority of democratically elected senators - along with the approval of the President – for any binding Treaty. This is in order to effectively safeguard national sovereignty against threats posed by foreign treaties. Interestingly, while the US signed up to the Kyoto Protocol, it was never ratified, because it failed to win supermajority support in the Senate.

In spite of the wealth destroying implications for New Zealand of most climate change policy, an argument that has been used by governments to justify strong action, is that associated with trade: if we don’t play our part in combating climate change then New Zealand’s trade will suffer. Given that Canada has thumbed its nose at climate change measures on the basis that they will damage the economy, I asked New Zealander David Seymour, a Senior Policy Analyst for the Canadian Frontier Centre for Public Policy and this week’s NZCPR Guest Commentator, whether Canada has experienced the sort of trade backlash that our politicians have warned us about:

“Canada is approximately fifty per cent wealthier than New Zealand on a GDP per capita basis, and on some days temperatures in some cities are colder than those at the North Pole.  Unsurprisingly, Canadians burn a lot of fossil fuels.  Putting aside a few small oil-rich nations, only the United States and Australia emitted more greenhouse gases per capita than Canada did in 2005.  Canada’s 22.6 tonnes per capita was twenty per cent higher than New Zealand’s 18.8, and by 2007 they were thirty-four per cent above their Kyoto target.

“Anybody who supposes they might be sorry for it is in for a rude shock.  Only last week did Prime Minister Stephen Harper agree to go to Copenhagen next month, and in case anybody was to take this as an act of contrition, his Minister for the Environment had this to say: One thing the Conservative government will never do is fly over to Copenhagen, pull a target out of the air that is ill-suited to our industrial base, to our geography and agree to damaging the Canadian economy.”

David explains, “In reality, Canada has not suffered trade problems due to its position on climate change policy.  Meanwhile, Canada has shown that a commitment to free trade is the most important factor in getting trade deals done.  With a trained economist as a Prime Minster, Canada has brought agreements with four new countries into effect over the past two years, and has a further eleven currently pending.  Since 2003, Canadian exports have risen twenty per cent, hardly the sign of a country that is becoming an economic leper in the international community.” To read David’s full article, click the sidebar link>>>

As the media hype over the Copenhagen conference reaches fever pitch, a scandal dubbed “Climategate” that hits at the heart of the whole theory of man-made global warming is unfolding. As a result of
data from the Climate Research Unit at the University of East Anglia in England making its way into the public arena, details of communication among the United Nations’ top climate scientists have raised doubts about the accuracy of the UN's influential reports. Serious allegations have been made that these scientists have been colluding to falsify data, manipulate results, and to block other researchers from having access to the figures - all in order to protect their fabricated evidence that the globe is warming due to the influence of man-made greenhouse gases. It is a scientific fraud of massive proportions and as the fallout spreads, there are calls for inquiries, resignations, and the disbanding of the whole United Nations Intergovernmental Panel on Climate Change (IPCC).

This scandal is so big that it has now enveloped our own crown atmospheric research unit, NIWA. NIWA has been accused of scaremongering by inflating temperature records to show the New Zealand’s temperature has increased by 0.92°C over the last 100 years
, far more than the IPCC's global average temperature rise over the last 100 years of 0.6°C.  In comparison the raw data shows an insignificant increase of 0.06°C over the 100 year period.[4] Questions over whether NIWA has been involved in this global scandal continue. If the data has indeed been doctored as some are suggesting, then a full inquiry should be called and those responsible exposed and sacked from their government paid positions.

President Vaclav Klaus of the Czech Republic
is one of the few world leaders who is an outspoken critic of the whole theory of man-made global warming. He was speaking in Washington DC earlier this month, reflecting on the forthcoming Copenhagen summit.[5] I will leave the final words this week to President Klaus:

I have already been at a UN Summit in Copenhagen before. It was in 1995 at the so-called Social Summit. At that time, the Summit was attended by then U.S. Vice President Al Gore who — so it seems — will be there again this year. I did also attend, as Prime Minister of the Czech Republic, but I don’t plan to go there now. I don’t see any chance to influence the results or to be listened to.

In 1995, there were huge demonstrations organized by all kinds of anti-establishment groupings - from socialists and greens to anarchists and anti-globalizationists. I have never seen such clashes between demonstrators and police and army forces before. The difference is that I don’t expect any demonstrations in Copenhagen now. The anti-establishment people have in the meantime become insiders and will be sitting in the main hall. This is a shift with far-reaching consequences.

We should not forget how the doctrine of global warming came into being. In a normal case, everything starts with an empirical observation, with the discovery of evident trends or tendencies. Then follow scientific hypotheses and their testing. When they are not refuted, they begin to influence politicians. The whole process finally leads to some policy measures. None of this was the case with the global warming doctrine.

It started differently. The people who had never believed in human freedom, in impersonal forces of the market and other forms of human interaction and in the spontaneity of social development and who had always wanted to control, regulate and mastermind us have been searching for a persuasive argument that would justify these ambitions of theirs. After trying several alternative ideas — population bomb, rapid exhaustion of resources, global cooling, acid rains, ozone holes — that all very rapidly proved to be non-existent, they came up with the idea of global warming. Their doctrine was formulated before reliable data evidence, before the formulation of scientifically proven theories, before their comprehensive testing based on today’s level of statistical methods. Politicians accepted that doctrine at the Rio Earth Summit in 1992 and — without waiting for its confirmation — started to prepare and introduce economically damaging and freedom endangering measures.

Why did they do that? They understood that playing the global warming game is an easy, politically correct and politically profitable card to play (especially when it is obvious that they themselves won’t carry the costs of the measures they implement and will not be responsible for their consequences).

I don’t see any problem with the climate now, or in the foreseeable future... We should not deceive ourselves. A cap-and-trade scheme is a government intervention par excellence, not a “market solution.” This country, my country, as well as the rest of the world face many real issues. We do not need to solve non-existing problems. I don’t think the real issue is temperature and/or CO2, but a new utopian vision of the world. We have only two ways out: salvation through carbon capping or prosperity through freedom, unhampered human activity, productivity and hard work. I vote for the second option.
 

Invitation to the GREAT DAY OUT AT THE FARM - from Muriel:

I would like to invite you to a very special NZCPR get-together and fundraiser (in conjunction with Owen McShane's CRMS) to be held in February next year: if you would like to meet others interested in politics and policy, as well as enjoying a wonderful day viewing world famous sculptures and exotic animals, then please visit the GREAT DAY AT THE FARM website here>>> for full details and to register your interest. I look forward to seeing you there!

NZCPR POLL
This week’s poll asks:

Should
New Zealand agree to contribute to the cost of climate change adaptation, mitigation and compensation for developing countries?
To vote click here>>> 
(Readers comments will be posted here>>> daily) 
To view last week's comments click here>>>

NZCPR Columnists

Roger Kerr: A REGULATORY RESPONSIBILITY ACT
Countries around the world have struggled with the problem of poor quality regulation which is economically costly and unnecessarily curtails citizens’ freedoms and choices... more>>>
Ron Smith: IRAN UPS THE ANTE
The news that Iran is building a second enrichment plant must surely remove all doubts about Iranian intentions and the need to deal effectively with them as a matter of urgency. ... more>>>

Lindsay Mitchell: MAORI & WELFARE - Privatisation of Services
There is an understandable view that now is a bad time to be talking about reforming welfare. On the contrary: there is no bad time to be trying to reform welfare.... more>>>  

http://www.nzcpr.com/Admin/RonAvatar.jpg Ronald Kitching: NATURE OF ECONOMIC ACTIVITY - part 1
Economic Science originated in discussions of the money price of goods and services. Its first beginnings are found in inquiries about coinage, then later prices more>>>

FOOTNOTES:
Articles can be found on the NZCPR RESEARCH PAGE - click here>>>
1.BBC, Climate Change help for the poor has not materialized
2.UNFCC, Copenhagen Draft
3.MFAT, Treaty Making Process in New Zealand
4.Richard Treadgold, Are we feeling warmer yet?
5.Vaclav Klaus, Largest tax increase in world history

NZCPR ADMIN
Please forward this newsletter on to your own networks and encourage other people to subscribe - that's how we grow. 

To help support the publication of these newsletters and receive your free EBOOK and unlimited access to our website Forum click here>>>

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Why not submit your burning issue for publication on our website Soapbox Series
?

If you enjoy political debate visit the Debating Chamber forum - many of our forum subscribers post up information for the public to view daily.


To contact Muriel about this week’s column please click here>>>. You can reach Muriel by phone on 09-434-3836, 021-800-111 or post at PO Box
984, Whangarei.

NZCPR Weekly is a free weekly
periodical from the New Zealand Centre for Political Research, a public policy think tank at www.nzcpr.com,
established in 2005 by former MP Dr Muriel Newman 

If you have a change of address, please note your old address and your new one and click here>>>. To unsubscribe, please click here>>> and send. 

(Please note - if you get back a message saying the address is not on the mailing list, it means you are subscribed under a different address and you will need to submit that one)

NZCPR 
Commentary




CANADA - PUTTING THE ECONOMY FIRST

David Seymour

Perhaps the true difference in the rhetoric and behaviour of Canadian and New Zealand politicians is the political will of the two countries’ voters.  In Canada’s latest election, the Liberal party practically signed its own death warrant by promoting as its main platform “green shift” policy that would shift a large part of the Federal Governments’ tax burden onto carbon emission behaviour. In New Zealand, the level of opposition to such policies has been too low, perhaps muffled by the national narrative that our “greenness” is one of our distinguishing characteristics.  Whether you believe that politicians are inevitably followers of public opinion (eg Helen Clark) or should be leaders who do what they think is right and take the consequences at election time (eg Ruth Richardson), there is clearly much that the New Zealand body politic can learn from Canada...

To read click here>>>


 
 
 
 

 


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Last Week's poll:
Should the PM step in and delay National’s ETS legislation?

Result: Yes 98%, No 2%
*Last week's poll comments here>>>
*All previous poll comments here>>>