Keith Ng on Greens compost
June 3rd, 2008 at 11:50 am by David FarrarKeith Ng focuses his fact checker on the Greens claims about the cost of milk increasing 60% and that it is all Fonterra”s fault and the greedy supermarkets. Some key points Keith makes:
- Milk has only increased 28% in the last year, and is only 2% higher than two years ago, 3% higher than three years ago and only 8% higher than four years ago. In other words the cost of milk dipped last year and is now at much the same level as it has been for the last four years.
- Dairy products make up only 1.2% of household expenditure or $11.60 a week. Capping Fonterra’s prices would save less than $2 a week per household.
Keith then looks at their call for farmers to move away from areas where we export, into areas where we import so we are self sufficient. Keith sums this up as:
Which, I assume, means that she wants New Zealand farming to diversify — away from the areas where it’s strongest, and into areas where it’s not.
He does a nice analogy:
To cutting down dairy production in favour of wheat etc. is like pouring water down the drain so you have empty vessels to catch rain with.
His summary:
This goes far, far beyond disappointing. Not only has the Greens managed to be wrong and stupid, but they’ve also managed to marry pre-Rod Donald naivety with Winston-like populism.
Did he really compare them to Winston?
It’s the kind of stunt that Winston pulls — making outrageous claims, safe in the knowledge that there will be no repercussions because it’s too ridiculous to be taken seriously.
Oh yes he did.
But even while trying to be populist, they still manage to look like the boogeyman from the ideological fringes.
Indeed.
They are right that Labour has been all talk about climate change, and that National won’t be any better. The only place where leadership on climate change can come from is the Greens. But they need to accept the simple fact that most of the people who support action on climate change are not out to destroy capitalism or globalisation.
This is not about cynical political rebranding, it’s about building a real consensus. The Greens can’t earn the trust of a broader voter base until you give up the radical part of themselves. Every time you push a radical left agenda, you’re pushing supporters of climate change action further away.
I like the implicit assertion that many in the Greens are out to destroy capitalism and globalisation.
Sadly, Keith is correct.
As I said yesterday, there are environmental areas where the Greens could have a positive influence on a National Government. But their “social justice” wing which does want to destroy capitalism is a big turn off for many.
June 3rd, 2008 at 11:58 am
Jeez DPF, why didn’t you just copy and paste the whole lot? Indeed. Indeed. Indeedindeedindeed.
Vote:June 3rd, 2008 at 12:01 pm
I agree with what is said above, but unfortunately there are some voters out there who still seem to regard the Greens as a half way house between Labour and National, they register the Green bit, not ‘Red” Russel and his social justice chums and the anti business anti trade focus they have. In fact if any party has a ‘so called secret agenda’ it is the Greens. It is secret because the MSM have yet to call them on it.
With apologies for link whoring but see my two recent posts on this:-
http://adamsmith.wordpress.com/2008/06/01/883/
Vote:and
http://adamsmith.wordpress.com/2008/06/03/931/
June 3rd, 2008 at 12:02 pm
And to comment on the actual article, this is up to Keith Ng’s usual high standard of research. I think he’s doing a fantastic job and politicians have been able to “Pull the figures out of their compost heap” for far too long.
The problem is, this isn’t a job for bloggers – some with the reach of a small-town rag. This is the work reporters and journalists are supposed to be doing before they regurgitate party releases in entirety. Otherwise the lie will always run around the world and the truth will always be getting it’s boots on.
Frequently our ministers and spokespeople play fast and loose with the REAL figures (crime, benefits and now prices) to try and push their agendas – not good.
Vote:June 3rd, 2008 at 12:09 pm
It would be helpful for voters to see the association between the green party and practical environmental issues for what it really is: weak and tenuous. They are at best a rag-tag bunch of commies, wannabe social engineers, anti-capitalists and have delivered precisely nothing of value during their bauble-laden slumber in office.
I’m really worried that ex-pat kiwi’s who live in smog-infested cities will unthinkingly cast their Green party vote in November with some dreamy eyed idea that it will help make NZ a safe place to return to one day. The truth is that given any Green voter mandate there won’t be anything to return to. I’m making it my business to contact EVERY ex-pat I know and warn them about the Commie/Druggie/SocialEngineer party that plies its trade as the ‘Green’ party.
Vote:June 3rd, 2008 at 12:10 pm
whos is keith ng? im a huge fan after reading that!
Vote:June 3rd, 2008 at 12:11 pm
“secret agenda”
Are you talking about National policy on TAX, Roading, Education, Health, Security, BioSecurity, Trade, Prisions…
if there is any secret agenda going on it’s the one that National is waging against the voting public of NZ.
Seriously though, why do we pay the export price of milk? Why is it cheaper to buy a Kiwi leg of lamb in Safeway in Vancouver than it is at Countdown in South Dunedin? It’s a bloody valid position to ask why?
Vote:June 3rd, 2008 at 12:15 pm
Quite a brilliant analysis and summary.
I would go a lot further and term the Greens as a bunch of “con” people supported by gullible people.
Vote:June 3rd, 2008 at 12:21 pm
Would you Frank.
So does that make John Key the ultimate con artist and National Supporters gullible, some policy please Frank or are you just going to vote with dogmatic ferver – who’s being the fool now?
Who are the greens conning? What are they conning about?
Vote:June 3rd, 2008 at 12:22 pm
Careful peeps – Keith Ng posts on Publicaddress.net, and DPF has that down as a left blog on the “Blogroll”.
Only, I’ve seen how much regard there normally is for “left blogs” among commentators here…
Vote:June 3rd, 2008 at 12:24 pm
Chris S, absolutely I agree with you. My point is that the media is not questioning the Greens on the impact of their policies, as I note in one of my posts there are policies which on the face of it are not unreasonable, but it requires resources and effort to ascertain what the real impact of such policies may be.
Paul, why do you want farmers to subsidise the consumer? On your logic I assume you will be quite happy to subsidise them when the price of their commodities goes back down? Fonterra asserts it is subsidising the NZ market to extent of$15million per year
Re your question on the price of lamb what does it cost in Dunedin per kg as compared with Safeway in Vancouver? Assuming we are comparing like with like, ie fresh/chilled versus fresh/chilled or frozen versus frozen.
Why should National lay out it’s policies before the election is called?
Vote:June 3rd, 2008 at 12:35 pm
These are classic diversions which keep the reporters busy while ignoring the real issues.
If we are to worry about petrol and milk why not worry about the price of bottled NZ water which is even more expensive?
Tomorrow I shall be attending the Transit Hearings on the Tunneling of the Waterview connection at 3.30 pm when they will be considering my submissions on behalf of the Highway Action Group. The current plan to spend an EXTEA 1.5 billion on tunneling this last section of the Western bypass is surely a scandal waiting to see the light of day. But you will not read a word about it.
The price of milk is a great diversion.
It cannot be coincidence that this $1.7 billion section to be tunneled runs through Helen Clark’s electorate, while the at-grade section, which costs only a couple of hundred million, runs through Phil Goff’s. Maybe if he was prime minister it would be reversed.
Every billion wasted on such projects destroys household savings (via government) of about 750 dollars.
So a billion on trains for Auckland, another billion plus to purchase Ontrack and this 1.5 billion adds up to over 1,750 dollars per NZ household. The cost of milk is trivial by comparison.
And even the Housing Corp extravagance looks minor.
Praise be to blogs.
Vote:June 3rd, 2008 at 12:40 pm
Keith Ng – The only person who’s blog I have ever read who (in the same post) can claim that fiscal drag isn’t decreasing peoples spending power and that threshold adjustments are increase peoples spending power.
He must have had a “muppet moment” trying to play the “Labour good – National bad” line of 9th floor talking points.
Vote:June 3rd, 2008 at 12:41 pm
link
Vote:June 3rd, 2008 at 12:46 pm
Kimble
http://www.publicaddress.net/default,5051.sm#post5051
Fiscal drag means people pay a greater proportion of their income in tax. That does not mean that people are worse off, since income is rising, too.
I commented on the standard, and he replied, but he had no answer for this;
http://www.thestandard.org.nz/?p=2032#comment-51194
Vote:June 3rd, 2008 at 12:47 pm
This is not about cynical political rebranding, it’s about building a real consensus.
It is about “cynical political rebranding”.
In the last election the Greens ran with Donald and Fitzsimons of impeccable enviromental credentials, but barely scraped into parliament at 5.3% and a good part of that was the swing away from Labour in the Maori seats (Foreshore and Seabed). They’ll not make 5% on the basis of “supporters on climate change”, especially now the enviromental issues have gone mainstream within both Labour and Nats.
This is a good move by the Greens as it drops the enviroment from the core of their policies (just like they are dropping the enviromentalists from their politicians – Mike Ward, Tanzcos, Fitzsimons) and positions the Green Party as staunchly left wing (with left wingers Norman, Bradford, Locke in charge). It might suprise some here, but there really are people who think voting “tax cuts” or voting “more tax cuts” as offered by the main parties are both bad choices. The Greens are offering themselves up as populist socialists in the room Labour has vacated jumping towards the centre right.
Vote:June 3rd, 2008 at 12:48 pm
“they need to accept the simple fact that most of the people who support action on climate change are not out to destroy capitalism or globalisation.” simple and brilliant summation.
Vote:June 3rd, 2008 at 1:02 pm
Maybe a post on the Greens’ proposed water resource levy would be in order too…although it’s hard to commentate on something without any specific numbers, the idea of tax-shifting is an interesting one…
Vote:June 3rd, 2008 at 1:13 pm
the problem as I noted in my post 931 today is that the resource levy may seem attractive, but what are the consequences – unless they can tell us the effect we cannot judge.
my post was about the fact that the Greens are getting a free ride from the MSM who are devoting little effort to questioning the Greens on the impact of their policies.
Bloggers like myself do not have the resources to research the policies in depth.
Vote:June 3rd, 2008 at 1:32 pm
oh I get it DPF. Using dairy product price increases for political gain is only ok when National implies that it’s the government’s fault. Part of National’s: the global commodities bull market is Labour’s fault meme. Gotcha.
Also, Paul: Yeah you’ve got it. John key has run a classic style over substance campaign, and the brand is selling. The thing is that no one even knows what’s in the cereal box – John just keeps on saying, “trust me kids, it’ll taste super”, and people believe him.
Of course Labour’s endless media management blunders haven’t helped them either.
Vote:June 3rd, 2008 at 1:35 pm
“the Greens are getting a free ride from the MSM ”
Nah – the Greens are always the most heavily attacked party in the MSM. For some strange reason the corporate-owned media just don’t like lefties. God knows why.
John Key on the other hand gets away with “trust me, you’ll like my policies after you elect me”.
Vote:June 3rd, 2008 at 1:43 pm
someone on PA just came up with this:
stuff up by a transcriber??
Vote:June 3rd, 2008 at 1:47 pm
“they need to accept the simple fact that most of the people who support action on climate change are not out to destroy capitalism or globalisation.”
The Greens are a market-based party, which believes in using market pricing mechanisms to solve environment problems. God knows where people get the idea that they want to “destroy capitalism”. This is kiwiblog though I guess.
Vote:June 3rd, 2008 at 2:00 pm
Of course Labour’s endless media management blunders haven’t helped them either.
The highly accurate and informed comments yourself, sonic and Paul have been providing (since at least the start of Labours decline) in public media like Kiwiblog have been invaluable.
Vote:June 3rd, 2008 at 2:12 pm
The Greens are a market-based party, which believes in using market pricing mechanisms to solve environment problems.
Milk is produced by cows whose emission of methane is a large contributor to AGW. The Greens want to “solve” this enviromental problem by making dairy products more affordable.
God knows where people get the idea that they want to “destroy capitalism”.
Reducing consumption by reducing prices might only be possible under a system other than capitalism, whatever it is that the Greens are suggesting.
Vote:June 3rd, 2008 at 2:19 pm
burt – I’m going to make up the numbers, but here’s how it works,
1999 – big macs cost $4. Average wage $40,000 – overall tax rate on average wage of 25%.
2008 – big macs cost $4.50. Average wage $50,000 – thresholds not indexed, overall tax rate on average wage now 28%.
In 1999 a person on the average wage paid 25% tax and could afford 7500 mig macs each year.
In 2008 a person on the average wage paid 28% tax (so surely they’re worse off?). Actually they’re not, they can now afford 8000 big macs a year – they’re 500 big macs a year better off, even though they’re still on the average wage and are paying more tax!
2008. Govt indexes tax rates. Person on average wage now paying 25% tax. Now they can afford 8333 big macs. They’re even better off with tax cuts, but that still doesn’t mean, they wouldn’t be better off in 2008 than in 1999 without a tax cut.
Vote:June 3rd, 2008 at 2:21 pm
Paul – are you the new sonic or gww?
Vote:June 3rd, 2008 at 2:25 pm
“For some strange reason the corporate-owned media just don’t like lefties.”
That’s another blatant lie, as statistics on the political beliefs of editors and journalists have shown time and time again. They’re lefties, just not far enough left for extreme control freak commies like the Greens.
Vote:June 3rd, 2008 at 2:29 pm
Roger, actions speak louder than words. The Greens have at the forefront of the fight against economic initiatives (e.g., FTAs) and are sworn enemies of globalisation.
The Greens reflect fears of the advance of industrialism that threaten the individual with a society of scientific management and assembly lines. With romantic simplistic longing, the alternatives look to the past, to what they believe was a simpler world, and a pristine environment.
In the past, it was priests and politicians who warned the masses about getting ideas above their stations. The priests said wealth was a sin, while political leaders put the “national good” over ‘greedy’ desires to have nicer homes and bigger cars.
Today, the Greens and environmentalists are the new mouthpieces for the idea that we should be meek, selfless and happy with our lot – only they say we should do it for the good of the planet rather than for God or the nation.
Vote:June 3rd, 2008 at 2:51 pm
Manolo, plus 1, Roger Nome, minus 1. You only need to take a look at a mag like “Pacific Ecologist” and read the rave reviews of what a wonderful place Castro’s Cuba is, to see the nexus between Red and Green in all its ugliness.
Vote:June 3rd, 2008 at 2:56 pm
And here is an excerpt from a recent speech by President Vaclav Klaus of the Czech Republic, which is highly relevant here:
“………….Nowadays, we should pay attention to other factors and processes, by means of which capitalism could be brought to an end, such as the traditional, but in the current “brave new world” of postdemocracy enormously expanding and growing disbelief in the ingenuity of man and in the advantages of the market process. It is, of course, not new because there have always been radical attacks on the market system, but I see a difference now. In the past, the market was attacked mostly by means of the socialist arguments and with the slogan about “the immiseration of the masses”. Now, it’s been replaced by a more dangerous slogan: the immiseration (or perhaps destruction) of the Planet.
It has many similarities but one important thing is different. The evidence that the people are better and better off (not worse off) could have been amassed in a shorter time, in a time – to turn the famous Keynes’s dictum upside down – when we all are not yet dead. Now, it will take centuries to come up with a convincing proof that the Planet has not been destroyed or does not find itself on the brink of destruction.
The free riding this new horse is therefore much easier. The ambitious politicians who try to mastermind the world and their fellow-citizens have been dreaming for decades to find such a marvelous, from reality immunized doctrine. Years or decades of cold weather will not disprove it – to my great regret. It is almost religious. My certainty that this ideology becomes the main vehicle for the destruction of the free market was the main reason for writing the book which was introduced here yesterday. (“Blue Planet, Green Shackles”).
Schumpeter was, hopefully, wrong in his predictions. And, in addition to it, he has been dead now for almost six decades. Al Gore is, however, very much alive.”
Václav Klaus, The Competitive Enterprise Institute Annual Dinner, 28 May 2008, Washington D.C.
Vote:June 3rd, 2008 at 2:58 pm
Vaclav Klaus , by the way, is one of the best authors there is today on this subject. HERE IS SOME MORE………
“My deep frustration has been exponentially growing in recent years by witnessing the fact that almost everything has already been said, that all rational arguments have been used and that global warming alarmism is still marching on. It could be even true that “We are now at the stage where mere facts, reason, and truth are powerless in the face of the global warming propaganda” (R. McKittrick, private correspondence).
We are regretfully behind it. The whole process is already in the hands of those who are not interested in rational ideas and arguments. It is in the hands of climatologists and other related scientists who are highly motivated to look in one direction only because a large number of academic careers has evolved around the idea of man-made global warming. It is, further, in the hands of politicians who maximize the number of votes they seek to get from the electorate. It is also – as a consequence of political decisions – in the hands of bureaucrats of national and more often of international institutions who try to maximize their budgets and years of careers as well regardless the costs, truth and rationality. It is in the hands of rent-seeking businesspeople who are – given the existing policies – interested in the amount of subsidies they are receiving and look for all possible ways to escape the for them often merciless, but for the rest of us very positive, general welfare enhancing functioning of free markets. An entire industry has developed around the funds the firms are getting from the government.
The basic questions of the current climate change debate are sufficiently known and well-structured:
1) Do we live in an era of a statistically significant, non-accidental and noncyclical climate change?
2) If so, is it dominantly man-made?
3) If so, should such a moderate temperature increase bother us more than many other pressing problems we face and should it receive our extraordinary attention?
4) If we want to change the climate, can it be done? Are current attempts to do so the best allocation of our scarce resources?
My answer to all these questions is NO, but with a difference in emphasis. I don’t aspire to measure the global temperature, nor to estimate the importance of factors which make it. This is not the area of my comparative advantages. But to argue, as it’s done by many contemporary environmentalists, that these questions have already been answered with a consensual “yes” and that there is an unchallenged scientific consensus about this is unjustified. It is also morally and intellectually deceptive.
You may find some of my arguments concerning these issues in this book. I can only wish you some enjoyment when reading it.”
Václav Klaus, Presentation of the book “Blue Planet in Green Shackles”, National Press Club, Washington D.C., 27. May, 2008
Vote:June 3rd, 2008 at 3:00 pm
Graeme Edgeler
So under your made up numbers the Big Mac went up less than CPI, what happens when “goods” go up more than CPI and incomes go up by CPI ?
Yes that’s right, the same (inflation adjusted) income cannot now buy as many of the same (inflation adjusted) goods.
With a larger percentage of income paid as tax and “basics” going up at a rate faster than CPI it’s a cruel hoax to tell people that fiscal drag isn’t really an issue becasue incomes are rising.
Vote:June 3rd, 2008 at 3:01 pm
Form Pacific Ecologist: “As the end of the oil age approaches, Paul Bruce, looks at the promising example Cuba provides. Cuba faced their peak oil experience prematurely in the 1990s. But Cuba rapidly changed, restructuring itself from an industrial country with mechanised agriculture and high petro-chemical inputs into a sustainable society.
While they may not have as many consumer goods, Cubans have higher life expectancy and literacy rates, and lower infant mortality rates than in the USA, because of the socially oriented nature of Cuba’s political/economic system.”
If so, why aren’t the masses flocking from Miami to Havana? Why do all go the other way?
By the way, the author referred above is the same Paul Bruce, a WRC counsellor, elected under the Green Party banner.
The Greens can be righlty called apologists for socialism and communism.
Vote:June 3rd, 2008 at 3:01 pm
THIS ONE is worth posting in its entirety: Vaclav Klaus at the recent Heartland Institute Conference on climate change:
“Mr. Chairman, ladies and gentlemen,
I would like first of all to thank the organizers of this important conference for making it possible and also for inviting one politically incorrect politician from Central Europe to come and speak here. This meeting will undoubtedly make a significant contribution to the moving away from the irrational climate alarmism to the much needed climate realism.
I know it is difficult to say anything interesting after two days of speeches and discussions here. If I am not wrong, I am the only speaker from a former communist country and I have to use this as a comparative – paradoxically – advantage. Each one of us has his or her experiences, prejudices and preferences. The ones that I have are – quite inevitably – connected with the fact that I have spent most of my life under the communist regime. A week ago, I gave a speech at an official gathering at the Prague Castle commemorating the 60th anniversary of the 1948 communist putsch in the former Czechoslovakia. One of the arguments of my speech there, quoted in all the leading newspapers in the country the next morning, went as follows: “Future dangers will not come from the same source. The ideology will be different. Its essence will, nevertheless, be identical – the attractive, pathetic, at first sight noble idea that transcends the individual in the name of the common good, and the enormous self-confidence on the side of its proponents about their right to sacrifice the man and his freedom in order to make this idea reality.” What I had in mind was, of course, environmentalism and its currently strongest version, climate alarmism.
This fear of mine is the driving force behind my active involvement in the Climate Change Debate and behind my being the only head of state who in September 2007 at the UN Climate Change Conference, only a few blocks away from here, openly and explicitly challenged the current global warming hysteria. My central argument was – in a condensed form – formulated in the subtitle of my recently published book devoted to this topic which asks: “What is Endangered: Climate or Freedom?” My answer is clear and resolute: “it is our freedom.” I may also add “and our prosperity.”
What frustrates me is the feeling that everything has already been said and published, that all rational arguments have been used, yet it still does not help. Global warming alarmism is marching on. We have to therefore concentrate (here and elsewhere) not only on adding new arguments to the already existing ones, but also on the winning of additional supporters of our views. The insurmountable problem as I see it lies in the political populism of its exponents and in their unwillingness to listen to arguments. They – in spite of their public roles – maximize their own private utility function where utility is not any public good but their own private good – power, prestige, carrier, income, etc. It is difficult to motivate them differently. The only way out is to make the domain of their power over our lives much more limited. But this will be a different discussion.
We have to repeatedly deal with the simple questions that have been many times discussed here and elsewhere:
1) Is there a statistically significant global warming?
2) If so, is it man-made?
3) If we decide to stop it, is there anything a man can do about it?
4) Should an eventual moderate temperature increase bother us?
We have our answers to these questions and are fortunate to have many well-known and respected experts here who have made important contributions in answering them. Yet, I am not sure this is enough. People tend to blindly believe in the IPCC’s conclusions (especially in the easier to understand formulations presented in the “Summaries for Policymakers”) despite the fact that from the very beginning, the IPCC has been a political rather than a scientific undertaking.
Many politicians, media commentators, public intellectuals, bureaucrats in more and more influential international organizations not only accept them but use them without qualifications which exist even in the IPCC documents. There are sometimes unexpected and for me unexplainable believers in these views. Few days ago, I have come across a lecture given by a very respected German economist (H. W. Sinn, “Global Warming: The Neglected Supply Side, in: The EEAG Report, CESifo, Munich, 2008) who is in his other writings very critical of the German interventionist economic policies and etatist institutions. His acceptance of the “conventional IPCC wisdom” (perhaps unwisdom) is striking. His words:
- “the scientific evidence is overwhelming”;
- “the facts are undeniable”;
- “the temperature is extremely sensitive to even small variations in greenhouse gas concentration”;
- “if greenhouse gases were absent from the atmosphere, average temperature of the Earth’s surface would be -6°C. With the greenhouse gases, the present average temperature is +15°C. Therefore, the impact of CO2 is enormous”;
- he was even surprised that “in spite of all the measures taken, emissions have accelerated in recent years. This poses a puzzle for economic theory!” he said.
To make it less of a puzzle, let me make two brief comments.
As an economist, I have to start by stressing the obvious. Carbon dioxide emissions do not fall from heaven. Their volume (ECO2) is a function of GDP per capita (which means of the size of economic activity, SEA), of the number of people (POP) and of the emissions intensity (EI), which is the amount of CO2 emissions per dollar of GDP. This is usually expressed in a simple relationship which is, of course, a tautological identity:
ECO2= EI x SEA x POP
but with some assumption about causality it can be turned into a structural equation. What this relationship tells is simple: If we really want to decrease ECO2 (which most of us assembled here today probably do not consider necessary), we have to either stop the economic growth and thus block further rise in the standard of living, or stop the population growth, or make miracles with the emissions intensity.
I am afraid there are people who want to stop the economic growth, the rise in the standard of living (though not their own) and the ability of man to use the expanding wealth, science and technology for solving the actual pressing problems of mankind, especially of the developing countries. This ambition goes very much against the past human experience which has always been connected with a strong motivation to go ahead and to better human conditions. There is no reason to make the, from above orchestrated, change just now – especially with arguments based on such an incomplete and faulty science as is demonstrated by the IPCC. Human wants are unlimited and should stay so. Asceticism is a respectable individual attitude but should not be forcefully imposed upon the rest of us.
I am also afraid that the same people, imprisoned in the Malthusian tenets and in their own megalomaniac ambitions, want to regulate and constrain the demographic development, which is something only the totalitarian regimes have until now dared to think about or experiment with. Without resisting it we would find ourselves on the slippery “road to serfdom.” The freedom to have children without regulation and control is one of the undisputable human rights and we have to say very loudly that we do respect it and will do so in the future as well.
There are people among the global warming alarmists who would protest against being included in any of these categories, but who do call for a radical decrease in carbon dioxide emissions. It can be achieved only by means of a radical decline in the emissions intensity. This is surprising because we probably believe in technical progress more than our opponents. We know, however, that such revolutions in economic efficiency (and emissions intensity is part of it) have never been realized in the past and will not happen in the future either. To expect anything like that is a non-serious speculation.
I recently looked at the European CO2 emissions data covering the period 1990-2005, which means the Kyoto Protocol era. My conclusion is that in spite of many opposite statements the very robust relationship between CO2 emissions and the rate of economic growth can’t be disputed, at least in a relevant and meaningful time horizon. You don’t need huge computer models to very easily distinguish three different types of countries in Europe:
- the EU less developed countries – Greece, Ireland, Portugal and Spain – which during this very period tried to catch up with the economic performance of the more developed EU countries. Their rapid economic growth led to the increase of their CO2 emissions in 15 years (in which they signed Kyoto) by 53%;
- the European post-communist countries which after the fall of communism went through a fundamental, voluntarily unorganizable transformation shake-out and an inevitable radical economic restructuring with the heavy industry disappearing (not stagnating or retreating) practically over night. Their GDP drastically declined. These countries decreased their CO2 emissions in the same period by 32%;
- the “normal” EU, slow-growing if not stagnating countries (excluding Germany where it’s difficult to eliminate the impact of the fact that the East German economy almost ceased to exist in that period) increased their CO2 emissions by 4%.
The huge differences in these three figures – +53%, -32% and +4% – are almost fascinating. And yet, there is a dream among European politicians to reduce CO2 emissions for the entire EU by 30 per cent in the next 13 years (compared to the 1990 level). What does it mean? Do they assume that all countries would undergo a similar economic shock as was experienced by the Central and Eastern European countries after the fall of communism? Now in the whole of Europe? Do they assume that European economically weaker countries would stop their catching-up process? Or do they intend to organize a decrease in the number of people living in Europe? Or do they expect a miracle in the development of the emissions/GDP ratio, which would require a technological revolution of unheard-of proportions? With the help of a – from Brussels organized – scientific and technological revolution?
What I see in Europe (and in the U.S. and other countries as well) is a powerful combination of irresponsibility, of wishful thinking, of implicit believing in some form of Malthusianism, of cynical approach of those who themselves are sufficiently well-off, together with the strong belief in the possibility of changing the economic nature of things through a radical political project.
This brings me to politics. As a politician who personally experienced communist central planning of all kinds of human activities, I feel obliged to bring back the already almost forgotten arguments used in the famous plan-versus-market debate in the 1930s in economic theory (between Mises and Hayek on the one side and Lange and Lerner on the other), the arguments we had been using for decades – till the moment of the fall of communism. Then they were quickly forgotten. The innocence with which climate alarmists and their fellow-travelers in politics and media now present and justify their ambitions to mastermind human society belongs to the same “fatal conceit.” To my great despair, this is not sufficiently challenged neither in the field of social sciences, nor in the field of climatology. Especially the social sciences are suspiciously silent.
The climate alarmists believe in their own omnipotency, in knowing better than millions of rationally behaving men and women what is right or wrong, in their own ability to assembly all relevant data into their Central Climate Change Regulatory Office (CCCRO) equipped with huge supercomputers, in the possibility to give adequate instructions to hundreds of millions of individuals and institutions and in the non-existence of an incentive problem (and the resulting compliance or non-compliance of those who are supposed to follow these instructions).
We have to restart the discussion about the very nature of government and about the relationship between the individual and society. Now it concerns the whole mankind, not just the citizens of one particular country. To discuss this means to look at the canonically structured theoretical discussion about socialism (or communism) and to learn the uncompromising lesson from the inevitable collapse of communism 18 years ago. It is not about climatology. It is about freedom. This should be the main message of our conference.”
Václav Klaus, Notes for the speech at the 2008 International Conference on Climate Change, New York, March 4, 2008
Vote:June 3rd, 2008 at 3:06 pm
Link or get ignored Philbest.
This is not your blog.
Vote:June 3rd, 2008 at 3:10 pm
“John Key on the other hand gets away with “trust me, you’ll like my policies after you elect me”.”
Until you know when the election is to be held, you dont know when the campaign really starts and you cant demand policy.
Simple rule, but sensible.
Vote:June 3rd, 2008 at 3:16 pm
Wage inflation of 25% but big mac inflation of 12.5%? Oh the fun we can have with numbers…
Vote:June 3rd, 2008 at 3:30 pm
If the Greens agenda was fully implemented it would mean big increases in unemployment and a big drop in standard of living. Companies like Fonterra can’t be forced to sell cheaply to the local market. If the Greens want cheaper milk and dairy products they need to campaign for government subsidy. We had that once. Some pig farmers were buying milk from the corner dairy and feeding it to their pigs because it was cheaper than wholesale milk.
Vote:June 3rd, 2008 at 3:33 pm
Roger Nome said: God knows where people get the idea that they [the Greens] want to “destroy capitalism”. This is kiwiblog though I guess.
Well, we get the idea they want to transform society in some significant way. It’s only by looking closely at the policies we get an inkling that the capitalist system is (according to them) largely to blame. But to be fair, maybe it’s just “the system” in general they want to destroy and rebuild.
In her maiden speech, Metiria (top 10 list candidate) affirmed that “My personal political journey has led me to the reasonable conclusion that the present state has no legitimacy and that it must ultimately be transformed into a system which implements Te Tiriti o Waitangi.”
Catherine Delahunty (top 10 list candidate) said: “I believe that solutions to the problems faced by the planet and its peoples will only be addressed by a redesign of the economic structures and political processes based on justice for all.
What justice for all entails will come up for discussion in future posts when people look at their policies for this election, just as National and Labour will be scrutinized. As a voter, I think the more scrutiny and analysis applied to all parties is welcomed.
Vote:June 3rd, 2008 at 3:44 pm
“God knows where people get the idea that they want to “destroy capitalism”.”
I think Nome is just being facetious.
Vote:June 3rd, 2008 at 3:46 pm
Labrator
Big screen TV’s, cellphones, iPods etc have not increased at the same rate as milk, meat, rent, petrol, property values, fruit, vegetables – you know the stuff I’m talking about – the basics.
It would be a pretty big call to tell a person who’s income has been gutted by fiscal drag that she can afford more iPods with her net income now than she could in 1999 even though she is paying a higher percentage of her income as tax now then she was in 1999.
I guess that’s how low people will go to defend Dr. Cullen’s use of fiscal drag to finance redistribution. Just don’t tell people they can’t afford as much milk, as much petrol or the house they almost purchased in 1999 – they may not notice that they are worse off if we confuse them by telling them they still have more cash in their hand then they had 9 years ago.
Vote:June 3rd, 2008 at 3:55 pm
“Milk has only increased 28% in the last year, and is only 2% higher than two years ago, 3% higher than three years ago and only 8% higher than four years ago. In other words the cost of milk dipped last year and is now at much the same level as it has been for the last four years.” ……………………..I don’t buy milk but did hear a Christchurch talkback caller claim that he was able to buy milk from the West Coast in CHCH for $1 per two litre less than the Fonterra supplier in the city. I do buy cheese and it has increased by at least 50%. I don’t mind paying a market price but I would like to see some price comparisons with the countries we supply.
PHIL…Don’t worry about Kimble I found the extracts from Vaclav Klaus speech well worth reading.
Vote:June 3rd, 2008 at 4:12 pm
Burt – I tried explaining it on PA, I tried explaining on the Standard, Graeme gave a perfectly good explanation above, but you just don’t care. It is really, really bloody simple.
As long as gross income rises faster than the tax take and inflation, real after-tax income increases. In other words, people can buy more things. This has happened. What part of this do you not get?
Vote:June 3rd, 2008 at 4:32 pm
keithng
The bit I don’t get is your assertion that an increase in the proportion of your income paid in tax is not reducing you net income. That’s the tricky bit – the bit that defies logic.
Many people in our economy get CPI increases and stuff all else. I note at this time that although MP’s have had circa 10% increases every year since 1999 that they will not approve the same sort of increase for junior DR’s.
Low paid workers are the most likely to be only getting CPI, no performance bonus etc. These are the same people that have suffered the most because the rising cost of basics is greater than inflation. Chuck fiscal drag into their equation and they are hit doubly hard. I’m not going in to bat for people earning $300K year, they have choices and plenty of them and the proportion of their income that a shopping trolley full of basics takes up is not something they can complain about.
I have no argument that IF salaries have gone up by more than CPI and more than the real cost of inflation and more than the effect of fiscal drag that they are better off.
It’s the factory worker getting CPI increaes every year loosing income to fiscal drag spending all available income on “survival” that is being hammered – hammered by Dr. Cullen’s fiscal policies.
Vote:June 3rd, 2008 at 4:35 pm
Extracted from
http://jimdonovan.net.nz/2008/06/01/always-remember-people-forget-the-sad-fact-about-that-special-deal-you-gave-your-customer/
UK factoid No 4: Tesco, Britain’s leading supermarket, calculates that its average prices have fallen 30% in the last 10 years.
UK factoid No. 5: The proportion of UK household expenditure on food has dropped from about a third in the 1970s to about 15% today.
UK factoid No. 6: The average British woman is 4 cm taller and has an extra 16 cm round the waist, compared to 50 years ago, which indicates much greater food intake per person, and therefore an even greater price drop per calorie than the figures above.
And it’s not just food. The real price of just about everything has fallen – eg. food, clothes, cars, appliances, entertainment, communications, travel. The only major exception is housing. A lot of those savings have gone into bidding up house prices (for larger living spaces, second homes and investment). House prices confuse the issue. Most people already own a house, so they see rising house prices as a good thing – “I’m getting richer relative to the cost of stuff” – even if they have lived in the same place for decades and have no intention of selling up in the foreseeable future. Falling house prices are bad – “I’m getting poorer relative to the cost of stuff”.
Interesting, and in my view correct; even though there are some things that have gone up heaps, other things haven’t!
MR McShane
Youur comment . . . . . .
Tomorrow I shall be attending the Transit Hearings on the Tunneling of the Waterview connection at 3.30 pm when they will be considering my submissions on behalf of the Highway Action Group. The current plan to spend an EXTEA 1.5 billion on tunneling this last section of the Western bypass is surely a scandal waiting to see the light of day. But you will not read a word about it.
The price of milk is a great diversion.
It cannot be coincidence that this $1.7 billion section to be tunneled runs through Helen Clark’s electorate, while the at-grade section, which costs only a couple of hundred million, runs through Phil Goff’s. Maybe if he was prime minister it would be reversed.
Every billion wasted on such projects destroys household savings (via government) of about 750 dollars.
So a billion on trains for Auckland, another billion plus to purchase Ontrack and this 1.5 billion adds up to over 1,750 dollars per NZ household. The cost of milk is trivial by comparison.
And even the Housing Corp extravagance looks minor.
. . . . . .leaves a lot to be desired. For instance the $200 million inflation in the tunnel cost in the space of a paragraph, and 3.5 times $750 now being depreciated from $2,625 to $1,750. You’re not the green party economist by any chance, are you?
Vote:June 3rd, 2008 at 4:41 pm
Good. Salaries have gone up faster than CPI. And faster than the real cost of inflation.
Vote:June 3rd, 2008 at 4:43 pm
Graeme Edgeler
Oh, that’s fine then. I’ll tell my low paid brother, my mother on GRI and my sister earning about $45K today they they are full of shit. Thanks for that.
Vote:June 3rd, 2008 at 4:47 pm
That’s easy Keith, the bit that doesn’t fit with preconceived notion & anecdote.
Vote:June 3rd, 2008 at 4:51 pm
It IS minor.
Vote:June 3rd, 2008 at 4:51 pm
llew
Almost, it’s actually the bit that doesn’t fit with Labour’s talking points. I’ll tell my brother that when he tells me he can’t afford to buy the same things now as he could in the late 90′s that’s he’s wrong. He will understand that simply becasue a 2 litre bottle of milk is more of a proportion of his income now then it was 10 years ago that it’s because his pay has gone UP more than inflation. Likewise the house that was 5 times his annual salary then and is 8 times his annual salary now, it’s becasue his annual salary has gone UP.
Yep I’m getting this, fiscal drag means paying more of your income in tax but still having more momney. Yep got that. Can I vote Labour now ?
Vote:June 3rd, 2008 at 5:17 pm
Happy to help. It’s not too complicated when you finally work it through.
Vote:June 3rd, 2008 at 5:22 pm
Graeme Edgeler
Once I explain this to him he will be quite excited that the large screen TV he couldn’t afford in 1999 is more affordable today though. He will be happy that the generic CPI figure which includes a whole pile of stuff he cannot afford is hiding the increase in the basics he needs to buy becasue the big ticket items are actually getting more affordable for higher earners.
Yep, he’s gonna love that news.
Vote:June 3rd, 2008 at 5:24 pm
Burt, I was pointing out the problem with Graeme Edgeler’s “made up” figures. Made up numbers are useless, especially when you make them up to support your point.
Vote:June 3rd, 2008 at 5:24 pm
Dave,
The difference in the costs of the tunnel is because in the first line I quoted the EXTRA cost compared to what it would cost if at-grade while in the second case I was quoting the total cost.
Take one from the other and you get the cost of Phil Goff’s stretch.
The second one was a typo – I was in a hurry and didn’t check properly.
Vote:Its about $500 for each billion and hence $750 for each $1.5 billion.
Anyhow, the point I was making was not so much the actual numbers but where our national savings are really being hit.
Clean out this sort of waste (and have a look at the gold plating of the Puhoi extension for some more) and tunnelng the Victoria Park viaduct extension for more) and there is plenty of room for more tax cuts without cutting down on health education and welfare,
June 3rd, 2008 at 5:28 pm
Labrator
I got that, sorry I wasn’t taking the piss out of you. I agree it’s pretty muppet like to say made up numbers support you position.
As I just mentioned above, wages may have gone up compared to CPI (overall – not in all cases), but low income earners are not buying the entire range of goods that make up the CPI average. Basic food items have gone up consumer electronic goods have come down for example. A big screen TV that you cannot afford today is still a big screen TV you cannot afford – irrespective if it’s now 1/200 of your income rather than 1/100 – you still cannot afford it.
A tank of petrol to get to work – well that’s another matter isn’t it.
Vote:June 3rd, 2008 at 8:15 pm
keithng
There is one more point you seem to completely overlook. Irrespective of how much wages have increased relative to CPI, when tax thresholds are not keeping pace with CPI (which they cannot do when they are static for so long) then people are worse off because of fiscal drag then they would have been without it. The latest round of tax cuts by Labour still don’t lift the thresholds to match the effects of CPI (on each and every threshold) compared to 1999 levels.
Saying that my pay rise has beaten CPI by 4% over 9 years while being reduced by 2% through fiscal drag – is still more money in my pocket is technically correct – but I’m only 2% better off – not the 4% I earned above CPI.
I know it’s not in keeping with Labour apologists to acknowledge the impacts of fiscal drag on real incomes, but even you yourself said it’s real (“* Fiscal drag is not a right-wing conspiracy. It is real. It is significant. It’s a part of the Government’s fiscal strategy.”).
Somewhere between it being real and having a real impact you seem to have got confused.
Vote:June 3rd, 2008 at 8:29 pm
I’m pretty sure Keith accepts that. I certainly do.
His point is that (using your numbers) you are 2% better off. Fiscal drag does not make people worse off when inflation is less than wage increases. They may be less well off than they would have been without it (I agree they are) but they are still better off than they were.
Vote:June 3rd, 2008 at 8:32 pm
Graeme
OK, but I would be worse off then I would have been if tax thresholds had not been held static for so long. So I’m 2% worse off because of fiscal drag. (using that example).
There is fiscal drag on all thresholds, not just the rich prick $60K threshold, so we can’t scrub this problem off as only effecting rich pricks. IE: We can’t say it’s OK because they deserve it when we are also talking about people earning circa $38K.
Vote:June 4th, 2008 at 2:28 am
“Seriously though, why do we pay the export price of milk? Why is it cheaper to buy a Kiwi leg of lamb in Safeway in Vancouver than it is at Countdown in South Dunedin? It’s a bloody valid position to ask why?”
The export price of milk is the price of milk. Question is why shouldn’t you pay it? As for the meat companies cannibalising themselves in overseas markets, well you ask them about that. Farmers aren’t too impressed about it either.
One of the things you learn in Marketing 101 (if you’re not taking worthless Pol Sci classes) is a concept known as the loss leader. In South Dunedin you may find beer priced at virtually cost along with other selected items in order to attract shoppers who once lured in by the low price of the “Pride of the South” then buy up all the other necessities for the week.
Vote:June 4th, 2008 at 4:00 am
In London supermarkets it’s not unusual to find some alcohol products for sale at half price. This is below cost and is well and truly a loss leader. There was some political pressure to “do something about it” (Much like plastic bags) but for now this pressure has fallen off the agenda. The Labour government in the UK has enough problems to deal with at the moment (Its imminent self destruction).
Vote:June 4th, 2008 at 4:46 am
The New Zealand tax system is a joke. The problem of fiscal drag should have been solved back in November 2005. New Zealanders collectively decided they could wear the costs in return for the Government spending their money better than they could. How are those public services looking now? Was it worth a block of cheese or two? Did the promised nirvana arrive?
In a democracy you get the government you deserve (Unless of course the ruling party steals $800,000 to buy themselves an election). New Zealand certainly has the economy it deserves right now. If New Zealand continues on the same trajectory that it is currently on then it is heading for a world of pain and abject failure. The only sensible course of action left is to migrate to an economy that can actually provide for its citizen through the miracle of capitalism.
Vote:June 4th, 2008 at 8:47 am
So I’m 2% worse off because of fiscal drag. (using that example).
Supporting your argument with made up numbers …
Seriously though. Using your numbers you are 2% better off. You’re not 4% better off, but you are still better off.
I have $204. I say, hey burt, here’s a $100 for engaging me in an interesting conversation, and hand it over. You say, can I have $104? I say no, but let’s make it $102.
You started with $100, and under your argument you are now $2 worse off because you could have had $104, but only got $102. Under my argument, you are $2 better off, because you had $100, and now have $102. Yes you could have had even more, but that doesn’t mean you don’t have at least some more than you did.
Vote:June 4th, 2008 at 9:11 am
Graeme
The really interesting thing here is that Dr
muppetCullen delivered a budget on the grounds of “giving more to people who need it most” and that’s been widely supported. The premise of “low income people needing it more” is based on the fact that they have less disposable (or available) income and the costs of basics have risen higher than inflation. Therefore they are more disadvantaged by the rising costs of the basics than high income earners.Then keith comes along and agrees with that and then tells us that fiscal drag is not making people worse off. So tell me this;
Why if fiscal drag is not making people worse off were the tax cuts designed to (almost) remove fiscal drag?
It’s not the maths I’m arguing with, it’s the BS spin that people are not worse off at the same time as congratulating Dr
Vote:muppetCullen on removing fiscal drag to make them better off. He simply can’t have that one both ways – it’s illogical.June 4th, 2008 at 10:18 am
The Greens truly are watermelons- green on the outside, red on the inside.
Vote:June 4th, 2008 at 11:26 am
The problem I have here with the made up maths is we’re using selected basket measurements of inflation to tell real world people they’re better off. Like Burt says, if his brother can’t afford to get to work because petrol is so expensive and he can’t afford to eat like he used to because of food inflation it is a real slap in the face to use the CPI and some big macs to tell him life is 2% better.
Fiscal drag is a sneaky tool to increase tax without most people realising it, no spin required.
Vote:June 4th, 2008 at 11:51 am
The REAL KILLER in all this, is the rising cost of housing, rising well ahead of average earning capacity. It might be all right for anyone who ALREADY OWNS their own home, but it is the young who are being increasingly locked out of ownership and locked into increasingly expensive renting.
The only places in the world where housing values have remained on the level with average income for decades, are in Texas. The reason: no zoning restrictions artificially reducing the supply of land. The rest is simple, if you understand supply and demand curves, high-school first-year economics. Yes, speculation and finance policies DO affect prices, ONCE THE CONSTRAINT ON SUPPLY HAS CREATED THE CONDITIONS for those things to have a disproportionate effect. If ANY LAND could be developed for housing at any time, there wouldn’t be the same incentive for speculators to buy up land on the edges of the existing suburbs, would there?
Vote:June 4th, 2008 at 3:11 pm
Burt, if your brother’s salary has not been keeping up with inflation, you should tell him to join a union.
Vote:June 4th, 2008 at 6:16 pm
keithng
He could just move to Aussie as well.
Vote: