NZ doesn't fit the mould

Apparently the US has a small welfare state because a majority of Americans believe that work is a determinant of success.

From the NCPA;

Capitalism, when combined with a relatively small government, is a well-established ticket to improved standards of living. However, many countries continue to oppose capitalism. The resistance of many countries to adopt capitalist economic systems has puzzled economists for decades, says Kevin A. Hassett, a senior fellow and the director of economic policy studies at the American Enterprise Institute.

In a recent study, economists Alberto Alesina, Edward Glaeser and Bruce Sacerdote found that pre-existing social attitudes toward luck may be the crucial determinant of the political path of a society. The authors uncovered a striking difference between American and European attitudes towards the poor:

* If you ask Americans whether they believe the poor are lazy, 60 percent agree.
* However, if you ask Europeans, only 26 percent say yes.

Historically, large welfare states have emerged in countries where citizens generally believe that luck determines income. According to the authors:

* If bad behavior (or laziness) is viewed as a source of poverty, then the welfare state is small.
* America has avoided the fate of Europe because its citizens disproportionately believe that luck is not that important a determinant of one's circumstances, but hard work is.
* If Americans are predisposed to believe that high incomes are generally merited, then they will be resistant to change.
* However, when capitalists succeed because of bribery and corruption, citizens become less convinced that the income distribution reflects merit, and are more willing to redistribute.

It takes more than luck to maintain a free society. If America is to avoid acquiring a welfare state the size of Europe's, the rule of law must be vigorously defended and the corrupt must be adequately punished, says Hassett.

But a recent NZ study found an even larger number of Kiwis blamed being poor on being lazy. A whopping 73 percent.

Yet New Zealand has become a large welfare state. The best reason I can come up with is that for decades now NZ has been 'ruled' by minority opinion. The special pleaders and anti-capitalists are running the show. The lobbyists are powerful and our parliament is not representative of how many New Zealanders feel about work and welfare. And political correctness has made people afraid to challenge the status quo.

Not the whole story

Susan St John, champion of welfare for children, telling us half the story,

Child Poverty Action Group economist Susan St John said the Budget made no effort to make it easier for beneficiaries to work by lifting the $80 a week limit on income they can earn before the benefit is reduced - a limit that had not changed for 22 years.

Limits for earned income have changed for those on the dole (who might also have dependent children.)

Until 1996 an unemployed person could receive the maximum benefit and earn NZ$50 (or $60 for beneficiaries with dependent children) a week before the benefit was abated. Under current arrangements an unemployed person can earn an income of $80 a week before the benefit is abated.

And although the $80 limit wasn't changed, for those on the DPB and WB, the amount of benefit lost between $81 and 180 was reduced from 70% to 30% for those with a youngest child over 14 in 2003. From the MSD press release,

This change to a social development approach is supported by the introduction of a new single abatement rate for DPB/WB clients allowing them to keep a greater proportion of any income they receive while on the benefit.

DPB/WB clients will be able to earn up to $80 a week on top of their benefit with no affect on their main benefit, and income between $80 and $180 reduces the benefit by 30 cents for every dollar received and by 70 cents for every dollar received over $180.

There are increases coming in the family support for beneficiaries with children. Family support is becoming a really big ticket item of government expenditure.

These are the figures from 2003-09 (actual to forecast)

$862 833 846 1,285 1,699 2,081 2,132

So as usual the CPAG are ignoring increases in assistance in order to strengthen their case for greater redistribution. Sadly it's what you come to expect from beneficiary advocacy groups.

Give parents and pupils choice

Flat tax and anti-smacking legislation

Sir Bob Jones was on Good Morning TV yesterday talking about tax, the Douglas era and how Roger's reforms were 'radical' in comparison to what was happening in the rest of the world. The Muldoon era of daylight robbery is discussed (actually 'discussed' isn't right - Bob thankfully does all the talking), the Laffer Curve effect, what's happening in Slovakia with their flat 10 percent tax, and why we should be following suit. It starts at 1:45.

(If you enjoyed Bob stay tuned for an announcement about my campaign launch where he will be guest speaker)

Then stick with the Good Morning (it soon won't be) and watch Beth Wood (Save the Children) and Ian Hassell (ex Children's Commissioner) argue with Bob McCoskrie (Family First) about the anti-smacking legislation. Quite teeth gritting stuff with the presenter clearly biased towards the proponents. This starts at 2:05.

Churches refuse to register as third parties

Thanks to a religious group getting involved in the 2005 election we are now lumbered with the ludicrous and unfathomable Electoral Finance Act.

Now more religious groups want to get involved in the 2008 campaign and are claiming the EFA does not apply to them and they will not be registering as a third party.

The churches are distributing 50,000 copies of the first of five leaflets, on child poverty, coinciding with the Budget this week.

Methodist Church president Brian Turner said the Electoral Commission recommended that they should "err on the side of caution" and register as third parties under the new Electoral Finance Act. But they decided not to.

"We don't see it as electioneering or promoting any particular party against others, so we didn't see the need to register," he said.

The same churches made it clear just weeks ago they want benefit levels raised. They are in the same camp as the CPAG who are backed in their legal action against the government by the Greens and the Maori Party.

The leaflets and 2500 posters are being sent this week to Anglican, Baptist, Catholic, Methodist, Presbyterian and Salvation Army churches under the auspices of their umbrella group, the Council of Christian Social Services.

The Council of Christian Social Services is very political. They make submissions to the Social Services Select Committee and they are traditionally left-wing.

I hope that the Electoral Commission is very fair-handed in administering this Act - if that is possible. But somehow I cannot imagine the churches being prosecuted. It makes me very unhappy to have to urge the application of rules with which I don't agree but then again the rules were supposed to bring about a level playing field and the churches should not be above them.

Not stacking up

I am a little perturbed by this front page story from today's DomPost.

Pacific Islanders' crime rates, poor education and low employment are creating an underclass and a drain on the economy, a study says.

Issued last week, the document says Polynesians are less productive and less likely to contribute to economic growth. They have the highest unemployment in every age group....

Not according to the Household Labour Force Survey. Maori have slightly higher rates.

Polynesians are over-represented in crime statistics and have higher rates of convictions and prosecutions.

Assuming Polynesians continues to mean Pacific Islanders, their crime rates are not especially high. In fact the article later disputes this saying,

Statistics NZ crime figures show Pacific Islanders made up 9100 of 112,774 people convicted in 2006 - just over 8 per cent.

8 percent is pretty much in keeping with their share of the population remembering that they are a young population and the age group that most commits crime is around 18-25.

Yes. Pacific rates of imprisonment are higher than European but considerably lower than Maori.



They are more likely to need Government assistance for housing and income.

More likely than who? Of those working age New Zealanders currently receiving a benefit 7.6 are Pacific. Again in keeping with their proportion of the overall population. (Maori on the other hand make-up 31.5 percent).

I would be the first to defend a researchers right to publish an ethnicity study without being subjectively attacked but on the basis of what has been reported I can understand why Pacific communities are angry about the focus on their people as producing an underclass.

AND, as with Maori, it must always be appreciated that many Pacific people are doing jobs that, although not well paid, are crucial to the functioning of our institutions.

UPDATE: Having listened to an interview with the study author I understand that the research is about different immigrant groups and their contribution to economic growth. But now I am even more concerned because the statistics are about ALL PI people, 60 percent of whom are not immigrants. He clearly believes that PI people are a drain and will become a bigger drain on social welfare but when asked specifically about those figures couldn't respond. His conclusion is that more PI immigrants should not be encouraged until the problems are sorted. They shouldn't be taking jobs off other low skilled people like Maori.

Why not? If they are more willing, if they have a work ethic, why not welcome them?

Serving up red herrings and victimhood for breakfast

Not unusually I can hear my husband loudly remarking "Silly b----h," at the TV.

I know in a minute he will put his head around the door and tell me about the latest display of mammoth intelligence from some hand-wringer.

"What's that about?" I enquire not lifting my eyes from the keyboard.

"Oh the silly b----h says that it's the fault of the liquor industry that so many more women are drinking and driving. Apparently it's because they have been targeting young women with alcopop thingies. Marketing is to blame. "

"Well you know," I respond,"That these women advocates will never have a bad word said against females. It couldn't possibly be their fault that they are drinking and driving. It's got to be consumerism or capitalism or any damn thing but the individual."

The truth is people drink and drive because of a widespread culture of irresponsibility. Period.

Can you help?

My son is doing a social studies project to gain some NCEA credits. It involves a 6 question survey aimed at people who will be directly affected by the Emmissions Trading Scheme. If you could assist by answering his questionnaire could you e-mail him at

mitchellr@athena-college.co.nz

I know he would be very grateful.

Vision versus reality

Labour's vision for state housing was as per the poster,



The reality was described thus,

Interviewer:Even as late as 1958 when Les Baily was seconded by the Department of Education to begin organising recreational activities for the children of the Hutt Valley, conditions and attitudes had not greatly changed.

Les Bailey:I was looking around that area, I always felt sorry for them in some ways with the predominance of state housing that was put into the district. All you saw was bare lawns, there wasn't a tree growing anywhere, no shrubs, no gardens, no places where kids could play freely, you know? — and there certainly was a lack of playground space. It wasn't a very attractive area at that time.

Sure they had the riverbank, the riverbank in those days wasn't the playing fields that are all there now, there weren't the stop banks in and so on.

Interviewer: This is the Hutt River?

Les Bailey: The Hutt River, yeah, and there was a lot of these pretty scrubby sort of areas down there and I imagine that perhaps that is where some of the Mazengarb report activities — as reported by them — took place.


And today those areas are even worse, particularly the 'shopping centres' (euphemism for takeaway shop, more takeaway shops, second hand shops selling over-priced junk, Credit Union, Housing NZ and Work and Income Offices). And the government is still forking out,

State house tenants say the sooner the Government starts insulating their homes, the better.

This week's Budget will include $53 million to make all state houses warmer and dryer within five years.

Peter Petterson has been in his state house in the Lower Hutt suburb of Taita for 30 years and says the upgrade is much needed.

"They are cold, you've got to use heaters. Some of the older people stick on some more clothes and blankets."

Mr Petterson says it is a shame the upgrade is happening after his children have grown up and moved out, but at least his grandchildren will benefit when they come to stay.


Labour's vision under Mickey Savage was never realised. All that happened was people were made dependent, robbed of their initiative and ambition, made poor, and frequently bitter and resentful. And still the socialists press on.....

What real commitment looks like

At last, a real plan to regain New Zealand's economic standing in the developed world. According to Radio New Zealand,

The ACT Party says slashing the number of MPs and offloading state businesses, would lift economic growth and leave the average New Zealander $500 per week better off.

They're part of 20 pledges that party leader Rodney Hide is promising to carry out, if ACT holds the balance of power after the 2008 general election.

Mr Hide is also committed to flattening tax rates, cutting state spending and remodelling climate change policies.

Mr Hide says the plans would help lift New Zealand from being poorer than the lowest ranked states in Australia and the United States; Tasmania and Mississippi.

He says the proposals would boost annual growth, by 5%.

The 20-point plan is here

Maori Party welfare policy

This is a late comment in response to an interview of Tariana Turia by Gordon Campbell. Never before have I heard Tariana spell it out so clearly. Their 'tough talk' on welfare applies only to Maori men, not Maori women.

Campbell: You’re saying welfare is bad for Maori, so we have to break the cycle by introducing a compulsory element -

Turia : We’re talking Maori unemployed. We’re not talking about Maori women on benefits.

It is shocking attitude. This is why.

The Maori Party condones Maori women raising their families on the DPB. With this action they are destroying the role of Maori men as fathers and providers. What is the imperative for having Maori men in jobs when they have no direct role to play in supporting their families beyond paying child support which, by the way, rises as they work their way up the food chain.

There are five times more Maori on DPB than on the dole. Maori childrens' needs are no different from any other. They need security, structure, predictability, and consistency, from both parents. When these things are missing there will be problems. These are more likely to be missing when they are being raised on welfare than when they are being raised by two parents earning a living from work.

And this differentiation highlights another aspect of the Maori party. Their policies are not only racist but sexist. But then traditionally Maori culture features a good degree of sexism. This policy does not bode well for the prospects of their tamariki.

As an afterthought Willie Jackson recently made this observation. That many of today's Maori leaders had strong fathers.