Friday, May 16, 2008

Assuming Kiwis will accept lower wages

That's what the Wall St Journal is saying our government's plan to implement an emissions trading scheme is predicated on.

The cost, for farmers and industry alike, is likely to be prohibitive. The New Zealand Institute of Economic Research, an independent consulting firm, recently estimated that the government's plan would result in 22,000 job losses by 2012, or 1% of today's employment. That translates into NZ$4.6 billion ($3.6 billion) annually in lost GDP, or a NZ$3,000 cut in each household's annual spending.

This analysis assumes that as greenhouse gas fees make Kiwi industry less competitive globally, businesses and jobs will move overseas. The government disputes this conclusion, mainly because its own analyses assume New Zealanders will be willing to take lower wages. That's debateable, to say the least.

That aside, give the Kiwis credit for honesty. Having signed up for Kyoto, they're actually talking about shouldering the costs of meeting their commitments. Whether or not they end up regretting it, other countries will now have a chance to see what the anticarbon crusade does to an economy.

So how do you feel about being the guinea pig?


One of the good aspects of life is anticipation. Optimists like setting themselves goals. Looking forward to something is often as enjoyable as the event. But 'waiting' can be quite a different story.

Having endured a fair bit of pain recently I finally succumbed yesterday and went to the doctor. Beginning the process of eliminating possibilities she referred me to a specialist. Thank goodness for the private system. She could secure me an appointment within 24 hours. When you can't sleep without painkillers you do not want to hang around.

So I read this piece about waiting times in the Canadian public health system with great sympathy for the individuals who cannot afford private care. Of course, the same applies in New Zealand.

Excessive waits for health care services endured by Canadian patients have imposed huge costs on the nation's citizens according to a study from the Centre for Spatial Economics.

Other major findings:

* The study of medical wait times in all 10 of Canada's provinces found excessive delays for four key procedures--total joint replacement surgery, cataract surgery, coronary artery bypass graft surgery, and magnetic resonance imaging (MRI) scans--cost the nation an estimated $14.8 billion in 2007.
* This in turn lowered federal and provincial government revenues by a total of $4.4 billion, the report noted.

However, it is individuals who bear these costs. When the government controls all of health care, it looks for ways to save money, and the easiest way to save is to deny care or ration care through long waits, says Charles M. Arlinghaus, president of the Josiah Bartlett Center for Public Policy.

Rationing care by using waiting lists puts a heavy strain on an economy by incurring high costs through reduced worker productivity, says Devon Herrick, a senior fellow at the National Center for Policy Analysis. Canadian Medicare uses rationing by waiting because the cost of lost productivity is borne by the individual and employer, whereas the cost of actually providing needed care falls on the public system.

For example:

* Excessive waiting for total joint replacement surgery was the most expensive byproduct of Canada's health care rationing, at nearly $26,400 per patient.
* That was followed closely by MRIs ($20,000), coronary artery bypass graft surgery ($19,400), and cataract surgery ($2,900).

Herrick disagrees with the study's policy prescription, saying private care options would be more effective than increased government investment in the system.

"Canadians should be allowed to pay for care privately if they so choose. It is unconscionable to forbid patients from paying for care the public system cannot provide them in a timely manner," he says.

Absolutely unconscionable.

Thursday, May 15, 2008

Just another Royal Commission

The Kiwi Party want another Royal Commission on Social Policy.

We have had two Royal Commissions on Social Policy in recent times. One in the 70s and one in the 80s.

The first stressed the principles of allowing beneficiaries to participate and belong (and gave us the DPB) and the second confirmed those principles.

A third commission would see a much stronger lobby for re-stating these principles (which rest on wealth redistribution and ignore the destructive incentives inherent in the process) than any opposing voices. The Kiwi Party must already know the same forces that lined up behind the anti-smacking legislation would line up at a Royal Commission arguing for 'inclusion' 'social justice' and other social democrat warm fuzzy concepts.

I can understand their political motivation for calling for another commission but am very sceptical that it will achieve anything beyond giving another platform to the poverty industry protagonists and keeping printers in work as they churn out volumes of reports.

Wednesday, May 14, 2008

ACT Tax Policy

Larry Williams interviews Rodney Hide about ACT's new tax policy. (Interview begins at 38.20)

The policy includes removing the 39c rate and making the first $10,000 of income tax free thus giving every earner on the average wage a $50 cut.

This is a good start because it is simple and it is heading in the right direction. It will also widen the gap between benefits and low wage work and stop this silly business of taxing kids with paper rounds or part-time McDonald's jobs.

Green concoctions over Comalco

What utter hypocrites the Greens are. Jeanette Fitzsimons;

Ms Fitzsimons says Rio Tinto should have no special allowances under the emissions trading scheme. She says although the operation is an important part of the economy, it is not so important that it should get special privileges ahead of ordinary New Zealanders.

This is the party that argues for tariffs - special privileges - to protect manufacturers.

Their entire social policy relies on greater redistribution of wealth - special privilege for some and penalties for others.

They urge government sponsored special treatment for NZ made products.

They support 'fair trade' which picks winners at the cost of other producers.

The Greens love privilege versus penalty. That is what gives them their power to plan and control human beings. Now they pretend to 'fairplay' by invoking their concern for the ordinary taxpayer. That'll be the ordinary taxpayer they want to pay for their grand desire to lead the world in the fight against climate change.

Talk about wolves in sheep's clothing.

Tuesday, May 13, 2008

Why we need more ACT MPs

"With government controlling more and more of our economy, the fact that crooks have to go where the money is causes more and more of them to turn to government employment. However, there is probably an even stronger reason for individuals to become politicians. That is the power which accompanies political office. Many idealists think they know better than the ordinary person what is good for that person. They consider themselves a cut above the ordinary individual who just isn’t smart enough to know what he or she should do. Idealists seek government power to impose their ideas upon the rest of us. They may be personally honest insofar as not thinking of lining their own pockets with money but have little compunction about bolstering their egos with government power. This attitude explains the environmentalists, the do-gooders, and others whose ego causes them to seek government power to impose their ideas upon those of us who just want to make our way in a free market in open competition with everyone else."

— Harry Hoiles, editorial from The Register [June 2, 1979]

This is why we need more MPs who will defend the free market and neutralise the above individuals.

Monday, May 12, 2008

ACT and the anti-smacking legislation

This is for the benefit of the Libertarianz Party who had their conference at the weekend and implied ACT had no position on the anti-smacking legislation. The above (which says Let Parents Choose and featured photos of Rodney and Heather)is part of an ad campaign run in the Sunday newspapers a few weeks back. Rodney and Heather also joined the anti-smacking march from Civic Square to Parliament in late March and voted against the legislation. Libz would do better to get on with their own promotion instead of running down the party which is closest to their ideals.

WFF - get rid of it

Naturally it has now dawned that Working For Families will discourage partnered women from the workforce. There is no consensus over whether that is a good or bad thing. Conservatives tend to like women to be in the home raising their children and leaving more employment opportunities open for men. The social democrats still believe strongly in equality and choice for women. The second part of the social democrat goal is about where I sit EXCEPT it must not be achieved through redistribution. Simply, if women want choice - home or work - they can pay for it.

Anyway, today's NZ Herald editorial has this to say;

The drop in employment can be greater than the rise in unemployment because the latter excludes people who are not actively looking for another job.

So long as those people are not urgently in need of a paying job - the greater number of them are women and the decline follows a rise in the "working for families" benefit - the figures are less of an economic concern and may even be a plus for the economy in present circumstances.

The trouble is, with WFF, all we are doing is dividing up the pie instead of growing it. There is at least a consensus (barring the Greens) that we do need economic growth. So I do not accept that the figures constitute "less of an economic concern". And neither would it seem do the new Australian government which is promising "a giant review of tax and welfare."

Effective marginal tax rates are a particular problem for partnered women with children, who see little value in working when their family benefits are withdrawn. The Government aims to get more of these women into the workforce.

I remain convinced - though the chances of ever proving my instincts are right are remote - that governments should just butt out of social arrangements. The more they try to centrally plan societies the more they stuff them up. They get caught on a never-ending see-saw of readjustment, wasting enormous resource and energy in the process. A low flat tax and the minimum of social assistance would see people organise themselves into situations that are beneficial both economically and socially.

Sunday, May 11, 2008

Bits and pieces

This will be interesting as it unfolds. A pharmacist on charges of supplying pseudoephedrine. Pharmacists supply pseudoephedrine every day all over New Zealand. In this case the charge accompanies those of possession of pseudoephedrine and possession of the equipment to make 'P'. Perhaps the first charge should actually be (or correctedly reported as) knowingly supplying pseudoephedrine for the manufacture of methamphetamine.

Bloggers make news again. From a piece about Judith Tizard in the Herald on Sunday;

"I understand Tizard is kept quite busy by being Helen's Mini-Me at all those Auckland cocktail parties..." wrote one emailer to the kiwiblog forum. "She's not stupid, just moody and, well, not the hardest working Labour MP by a long shot," wrote blogger Liberty Scott. "One thing is for sure, Judith won't be remembered as a mover and shaker, but as one of those odd MPs who is really there because of family heritage."

Love the comment at the end of the piece. Tizard says she doesn't want to be in cabinet because, "It's an awful waste of a Monday."

And the Sunday Star Times reports beneficiaries are worse off now than after the benefit cuts of 1991, 'worse off under Labour'. Will Labour peg core benefit rates to average wages? I think they just might promise to with the spin being 'as we have reduced benefit numbers by so many we can now afford to "invest" more, particularly in those families with children.' The Maori Party and Greens will agree. That'll secure the quarter-million-strong beneficiary vote for a left government.