The Greens’ New Deal

May 18th, 2009 at 10:00 am by David Farrar

On Friday the Greens launched their so called Green New Deal, with a price tag of $3.3 billion over three years. It has five main elements:

  1. Energy efficiency measures such as home insulations, school upgrades etc costing $300 million.
  2. $1 billion to be shifted from roads to public transport (so not count as new spending)
  3. $600 million on protecting waterways
  4. $2 billion constructing 6,000 new state houses
  5. $440 million on community economic development

Most countries have had a to take the edges off the recession. NZIER calculated that the NZ to date will save around 10,000 jobs. They also point out that the increased debt lowers household incomes down the track.

The estimate their package would create 18,000 FTE jobs directly and andother 25,000 indirectly.

I’ll analyse parts of it shortly, but have to say for now that it at least passes the initial test that they are proposing generally one off projects, rather than initiatives that would permamently increase Government spending at a time we can’t afford it. They are the sort of projects that can be considered as part of a fiscal stimulus.

The energy efficiency measures tend to be the most sensible, as they actually can pay for themselves over time by lowering energy costs.

The suggestion that $1 billion be taken from motorways and put into public transport is simply not going to happen. The Greens always try and portray it as a choice between roads or public transport. It is not. We need both. There is not a country in the developed world that has just stopped building new roads.

The plan to protect rural waterways from pollution has more appeal to me – there are tourism reasons you may want to do this.

$2 billion for new state houses is not a good priority. The current housing stock is run down and the Govt under Labour became a slum landlord. The Govt’s priority is to improve the current stock before looking to expand it – that is sensible.

So anyway have to give the Greens kudos for actually putting up costed serious proposals, even if I do not like many of them. I much prefer them doing this than working on further things to ban!

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44 Responses to “The Greens’ New Deal”

  1. campit (467 comments) says:

    The suggestion that $1 billion be taken from motorways and put into public transport is simply not going to happen.

    DPF the Government intends to take over a billion dollars from every transport funding category and put it in to state highways over the next three years. PT infrastructure will be slashed, local roads funding cut by up to $225m.
    Yet the BCRs of the “Roads of National Significance” have yet to be announced, or even analysed as far as I know.

    If the Greens get this through we’ll only be back to where we started.

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  2. campit (467 comments) says:

    The Greens always try and portray it as a choice between roads or public transport. It is not. We need both.

    Agree totally. Looking forward to the completion of the public transport network in Auckland then.

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  3. Adolf Fiinkensein (2,903 comments) says:

    The Greens are fulfilling Adolf’s prediction that they will rapidly become the true opposition in New Zealand while Labour flounders about looking foolish. Clark’s legacy is the destruction of her own party.

    Norman’s poster in Mt Albert says it all, really. If you want muscle, vote Russel. Tell Goff to **** off!

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  4. homepaddock (408 comments) says:

    “The plan to protect rural waterways from pollution has more appeal to me – there are tourism reasons you may want to do this.”

    Not just tourism benefits – this is the water we drink. We also swim in it.

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  5. Murray (8,847 comments) says:

    1. Energy efficiency measures such as home insulations, school upgrades etc costing $300 million.
    Whose homes? The people who pay the least taxes again I suspect. More punishing success and “wealth redistribution”

    2. $1 billion to be shifted from roads to public transport (so not count as new spending)
    Lets the roads fall into disrepair and put more empty buses on them. Very sensible.

    3. $600 million on protecting waterways
    Here’s a stick Gentix, you cover the the North island rivers and Bradford can just use here grim dial to scare people away from the rivers in the south.

    4. $2 billion constructing 6,000 new state houses
    What are you kidding me?

    5. $440 million on community economic development
    Ok just piss off, seriously. Use money we don’t have on feel good social engineering bullshit.

    Finaly I refer you once again to the election results. You lost, no one wants your ideas. Go away.

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  6. myflathasmould (2 comments) says:

    “$2 billion for new state houses is not a good priority. The current housing stock is run down and the Govt under Labour became a slum landlord. The Govt’s priority is to improve the current stock before looking to expand it – that is sensible.”

    This is not taking away money from upgrading current housing stock. Given that we are seeing a need for job creation in the construction industry building new state homes as well as energy efficiency retrofits is a sensible way of ensuring that jobs are created to match demand. We need to capture the jobs that are being lost in the construction, and industry so that the retail jobs dependant upon consumer spending don’t continue to go to. Much more effort to retrain retail workers to work in other fields than to prevent their jobs going in the first place by acting further up the chain.

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  7. peteremcc (344 comments) says:

    “The Greens estimate their package would create 18,000 FTE jobs directly and andother 25,000 indirectly.”

    This is as shoddy an estimate as the law commission’s alcohol study.

    The law commission looked only at the costs of alcohol, the greens are looking only at the benefits of this spending.

    How about the greens tell us how many jobs they estimate will be lost by the tax take that will be required to pay for all this.

    If the number of jobs created by spending the money is greater than the number lost by collecting it, THEN we can have a discussion about whether the projects are worthwhile, whether they’re something the government should be getting involved in etc.

    But if you can only tell me the benefits of your idea, and not the costs, then I don’t even want to hear about it.

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  8. dime (9,972 comments) says:

    Adolf – The Greens will never poll higher than Labour. They will always be too far to the left (nuts).

    i dont mind if they spend a few billion on public transport… will make the roads less busy for Dime :) :)

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  9. insider (1,028 comments) says:

    I spotted a dodgy statistic on the first line of the exec summary of their stimulus package, and I was skim reading! Wonder what else was wrong.

    It says there are 2:1 health benefits from home insulation. The only NZ study I know of that has got close to quantifying the benefits was Ralph Chapman’s and he came up with 1.73, which was total including energy savings not just health benefits, and which is definitely not 2.

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  10. frog (84 comments) says:

    Well insider, as I pointed out on frogblog when you raised this point on Friday, the most recent work is by Phillipa Howden-Chapman and is available in the British Medical Journal. It was used to justify the Greens successful budget bid last year to insulate all state houses and then subsequently to win our bid for the billion dollar Green Homes Fund with Labour during the ETS discussions. You are old news, insider.

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  11. frog (84 comments) says:

    Insider – I have re-read the conclusions of Howden-Chapman’s later study, and indeed the 2:1 is both energy and health benefits, with health being the vast majority, perhaps your 1.73 figure. The energy savings recovered about half the cost of the installation on their own. Either way, the 2:1 figure was labelled conservative and doesn’t include productivity gains from days of work not missed, etc. I’ll withdraw my earlier comment and split the difference with you…

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  12. Ratbiter (1,265 comments) says:

    What is “Community Economic Development”?

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  13. Ratbiter (1,265 comments) says:

    “$2 billion for new state houses is not a good priority. The current housing stock is run down and the Govt under Labour became a slum landlord. The Govt’s priority is to improve the current stock before looking to expand it – that is sensible.”

    Should Housing NZ be aiming to provide affordable rental homes for more poor people, or increasing the book value of the Government’s current portfolio of houses? I guess it depends on your point of view, whether you are a poor person in need of a state house, or a financially-independent taxation/freedom enthusiast!

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  14. stephen (4,063 comments) says:

    Well if you want to dismiss DPF’s ‘slumlord’ comment (presuming it’s valid), wouldn’t a bunch of shithouse log cabins somewhere be good? After all, it’d be affordable ;-)

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  15. MT_Tinman (3,184 comments) says:

    # dime (1288) Vote: Add rating 3 Subtract rating 1 Says:
    May 18th, 2009 at 10:52 am

    i dont mind if they spend a few billion on public transport… will make the roads less busy for Dime :) :)

    If only that were true Dime, I’d agree.

    It ain’t!

    The roads would become unusable, blocked by bloody great, empty, no doubt diesel fume spewing buses.

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  16. toad (3,674 comments) says:

    Murray said: Community Economic Development

    No, Murray, the money would come from deferring the building of new roads (like the SH 20 Waterview connection, for example) – not from reducing or defering maintenance of existing ones.

    Ratbiter said: What is “Community Economic Development”

    In the context of the Green New Deal, this is what is proposed re community economic development Ratty:

    Community Economic Development
    Some years ago the Labour Government abolished the last remaining Government unit dedicated to supporting community economic development – CEG. While there is no wish to exactly replicate CEG, there is an u rgent need to establish a dedicated community economic development unit, with strong involvement from community-based practitioners in its
    development and ongoing functioning.

    To be effective, the unit would also need funds to help assist those organisations in the community carrying out environmentally and socially useful work while also creating jobs, often among people and communities most heavily impacted by unemployment.

    While we are confident that these measures will be successful in building local economic resilience and creating jobs that are valuable to communities, we have no basis to be able to make accurate predictions of these benefits and, therefore, have elected not to. There are quantitative data available from CEG, but we do not consider these to be a reliable basis. The examples of community-based waste minimisation and housing above give an indication of what is possible.

    We envisage the establishment of a Community Economic Development Unit ($5m per annum) with the following functions:

    Supporting community economic development initiatives at local, regional and national level.

    Assisting Government departments, Local Government and private business to better understand and work with the community sector to successfully create jobs and to meet real social and environmental needs.

    Provision of some loan and direct funding support to community-based economic initiatives, and assistance with brokering same.

    Support for research, development and training congruent with the needs of the community economic sector.

    Support for community owned and directed banking initiatives such as the Bendigo Bank project currently being considered by Kiwibank in association with some local authorities.
    Examples of this include: recycling and reduction of waste; provision of free or low cost health, welfare, educational and community development services to marginalised individuals and communities; community transport initiatives; river and coastal restoration; weed control; replanting; community and ethical banking; community gardens; housing support and much more.

    Jobs in the community sector tend to be created and maintained at a lower cost than jobs in the public or private sectors due to the values-driven nature of not for profits, and the contribution of volunteers.

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  17. Ratbiter (1,265 comments) says:

    Stephen,

    Of course it would be wasteful to allow state houses to fall into disrepair, so of course there has to be a maintenance budget. (I would like to see this done in conjunction with a scheme whereby, if you mistreat or don’t look after the state house you are living in, you have blown your chance and you are evicted and permanently blacklisted.)

    However if the aim of the service is to put roofs over the heads of the very needy, then as long as there is a backlog of the needy then as much as possible of the budget needs to go into new state houses to try to meet this need, not nicing up existing ones (or employing 14 internal comms staff at Housing NZ HQ to do SFA all day!)

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  18. toad (3,674 comments) says:

    DPF said: The current housing stock is run down and the Govt under Labour became a slum landlord.

    It was a slum landlord under National too DPF. The Greens are talking about

    …housing that exceeds WHO standards for health and welfare, meaning happier households and lower health costs for the taxpayer. Having modern, energy-efficient state housing stock reduces demand for water and energy dramatically, protecting the environment and delaying the need to build more capacity.

    Doesn’t sound like slum housing to me.

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  19. WraithX (283 comments) says:

    Frankly, why bother insulating state homes when the majority of tenants will eventually smash the windows or doors anyway and consequently remove any benefits that may be gained?

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  20. emmess (1,428 comments) says:

    It will always be slum housing because nobody ever washes a rental car

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  21. jarbury (464 comments) says:

    $2 billion for new state houses is not a good priority. The current housing stock is run down and the Govt under Labour became a slum landlord. The Govt’s priority is to improve the current stock before looking to expand it – that is sensible.

    Much of it is so run down that you’d have to be stupid to improve the stock and not just redevelop it. Why the heck would you spent $100,000 renovating a house on 1000m2 when you could redevelop it into 4 houses instead? You could even sell two of those houses to reduce the concentration of state houses if you liked.

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  22. backster (2,171 comments) says:

    How much would productivity and GDP increase if these measures were implemented.

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  23. serge (108 comments) says:

    Green New Deal rubbish, it is still red. Their policies are a road to nowhere in this economic climate particularly. It is JOBS YOU RED (GREEN) IDIOTS! PEOPLE NEED JOBS, NO CONSUMERS NO ECONOMY! We need to Produce goods and services, that is what makes the world go arround….6000 more state houses will help no hopers…what about housing those with trades or even degrees?

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  24. Philonz (88 comments) says:

    The insulation idea is a great one and I have no problem with subsidies going to those in the lowest tax bracket for this purpose. Insulation installers will get work, we will save energy which will reduce chance of ‘brown-outs’, we’ll have fewer people getting sick from their damp houses which means savings for the health system and better productivity.

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  25. nandor tanczos (75 comments) says:

    serge, I think the idea is that tradepeople benefit from being employed or contracted to build the houses. Its a variation on a pretty well established economic principle, with the added social and economic benefits that come from adequate housing provision (one area where the market consistently fails).

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  26. toad (3,674 comments) says:

    Cheers, Nandor. And it is a short-term commitment to both provide work to those who would otherwise be unemployed as a consequence of the serious downturn in housing construction, and to provide healthy homes for those who otherwise might be living in overcrowded conditions, or even in cars or caravans.

    All good from where I’m sitting.

    Or from where anyone is sitting, apart from the neo-cons (serge – take note) who believe that everyone who lives in a state house is and always will be a “no-hoper” member of the undeserved poor.

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  27. Redbaiter (13,197 comments) says:

    “adequate housing provision (one area where the market consistently fails).”

    In what way does it fail, and how does braking the economy by over taxing help people afford better housing?

    What you want is for everyone to live in soulless communist style apartment blocks easily served by mass transit public transport right?

    I’ve got a better idea. Why don’t you go to Sweden and live, and leave NZers to live as they always have. Enjoying one of the highest rates of home ownership in the world.

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  28. Redbaiter (13,197 comments) says:

    “What is “Community Economic Development”?”

    Its a communist euphemism for making as many people as possible dependent on the state, and ensuring that nobody who aspires to a station in life above the level approved by The Watermelon’s commissariat is permitted to achieve that goal.

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  29. toad (3,674 comments) says:

    Redbaiter, I’ve got a better idea. Why don’t you go to Zimbabwe to live, and leave us NZers to live as we always have – i.e. without dictatorial domination.

    I would like to see your justification for Auckland governance being reorganised under Parliamentary urgency with no public input. RB, I thought that was precisely what you opposed, but now it is a NACT Government doing it, you by your silence appear to support something far more authoritarian than anything (even the EFA) that Labour ever did.

    There always has been discrimination and suppression on the basis of race, class and gender, both here and in Zimbabwe. At least we have not totally institutionalised it – at least yet!

    I think you and Mugabe could get along quite well (as long as you are the subservient functionary) Redbaiter.

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  30. Redbaiter (13,197 comments) says:

    The Watermelon’s have a vision, and that vision is one where NZers line up cap in hand to receive the benevolence of their masters, the Nomenklatura who hand out the favours, the contracts, the awards, the subsidies, the allowances and the benefits.

    Its a world where everyone is bound to fill in a form for this and another form for that, and yet another for something else, and be asset tested, and health tested, and means tested and once again, there is a legion of superior beings doing the testing while the huddling multitude cower in forelock tugging gratitude, awed by the gracious benevolence of the state and those (the Sue Bradfords and the Keith Lockes) who administer it.

    Its a place where citizens are herded and drafted and selected and rejected and approved and registered and categorised and qualified or disqualified and all the time reminded of how fortunate they are to be in the hands of the welfarists.

    This is what the Watermelons work for. Their stinking collectivist outcomes that reduce real people to shuffling cyphers and spiritless recipients of the state’s benevolence. Socialist zombies.

    Jesus you people make me want to puke.

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  31. bchapman (649 comments) says:

    All these things are good things to help create diverse interesting communities but what NZ really needs to provide high paying jobs. Our companies need value added products which are difficult for our competitors to replicate- science, green technology and food research all fit nicely with green values as well as promoting economic productivity

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  32. Redbaiter (13,197 comments) says:

    I think you and Mugabe could get along quite well (as long as you are the subservient functionary) Redbaiter.

    I don’t know what it is with your head that you are apparently so incapable of understanding that my goal is a government that is small and weak and hardly noticeable.

    And every word I ever write on these forums is aimed at that objective.

    How you can say this equates to support of a vicious and murdering all powerful totalitarian dictator is something that cannot be explained other than as a dishonest and cowardly attempt to smear.

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  33. bwakile (757 comments) says:

    $440 million on community economic development

    That will be $439,999,000 on commitees, reports, seminars, open days, planning, think tanks, environmental impact studies, consultations, work streaming and what ever else socialists do to fill in their day and a thousand bucks for some poor sod to go out and pull weeds for a week.

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  34. Dazzaman (1,140 comments) says:

    3.3 billion dollars!! That stopped me reading the rest right there!!! They’re big on ideas but stupid enough to put a figure to their hair-brained schemes. Who wants to put that sort of money into stuff that will never bring a decent return or any return for that matter.

    The large government, socialist wanky shit has already been shown to be bullshit, do the watermelons think a future coalition partner would seriously go down that route again? Then again, maybe so, plenty of Klarkites still sitting around the trough.

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  35. toad (3,674 comments) says:

    Redbaiter said: I don’t know what it is with your head that you are apparently so incapable of understanding that my goal is a government that is small and weak and hardly noticeable.

    It may be your goal, RB, but much of what you post suggests otherwise. Because it suggests you want to suppress, rather than debate, the views of those who think differently from you (ie, those who think the state has a significant role to play in economics).

    And there is a word for those who suppress democratic expression of the views of those who think differently from themselves. Without wanting to Godwin the thread, I think you know what that word is RB!

    It is a bit like Rodney Hide’s performance on Auckland governance. He purports to be a libertarian, but his actions preventing democratic participation in the decisionmaking brand him as an autocratic fascist.

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  36. bchapman (649 comments) says:

    I assume those advocating small and weak government don’t want immigration controls, biosecurity, foreign ownership controls or public roads.

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  37. nandor tanczos (75 comments) says:

    well the market fails because it has never been able to provide adequate housing stocks – at least in this country, I haven’t studied it in any other. The investment needed to build housing stock means that it is only worth doing to a certain level, beyond which returns fall, so private investors stop investing.That is to say the economically optimal level is not the same as (what I consider) the socially optimal level ie everyone has decent shelter. Same as the economically optimal level of employment is not full employment.

    For that reason, since WW1 NZ has always relied on govt intervention in the housing stocks to provide housing for those on low incomes. Not necessarily people who are lazy or useless, just that segment of society with the low incomes.

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  38. Redbaiter (13,197 comments) says:

    “I think you know what that word is RB!”

    Damn right. Its “socialist”.

    That curse upon mankind that for decades now has waged war on freedom of expression with the long term goal of making it unacceptable for any citizen to utter words critical of the concept.

    Read Roland Huntford’s book “The New Totalitarians” Toad, for a good illuminating read on the strategies the left have employed in their attempts to incrementally integrate their politics and our culture.

    Most socialists are authoritarian elitists who think people are too stupid to govern themselves. They have adopted their own ideas of how to run the country, and, rather than sell those ideas, they seek to impose their ideas. Like all authoritarians, these elitists believe that any idea of theirs is revealed truth because it’s their idea.

    The authoritarian streak in today’s socialists can be seen in their viciousness in attacking all who disagree with them, a common tactic used by communists, Nazis and fascists. They seek not to engage in a discussion of competing ideas but rather to exclude their opponents from the debate by branding them as members of unacceptable groups.

    Like you tried Toad, when you attempted to align me with Nazis and Mugabe.

    In other words, there is to be no discussion of the subject. The socialist position is correct, and all who disagree are evil heretics.

    The pseudo-liberal socialist closely resembles the professional communist. He preaches tolerance while practicing intolerance; he condemns bigotry while being a bigot; he purports to be for open debate while silencing all of his opponents; he says he is for religious tolerance while routinely slandering Christians; he purports to be for multiculturalism while viciously attacking the culture that civilized New Zealand was founded upon, which is European.

    These pseudo-liberal socialists should be recognized for what they are: authoritarians, wearing a disguise. Look under that disguise and you will find the mortal enemies of any free society.

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  39. Redbaiter (13,197 comments) says:

    “I assume those advocating small and weak government don’t want immigration controls, biosecurity, foreign ownership controls or public roads.”

    You are of course free to make whatever assumption you like, no matter how irrational and detached from reality.

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  40. toad (3,674 comments) says:

    Redbaiter said: …he purports to be for multiculturalism while viciously attacking the culture that civilized New Zealand was founded upon, which is European.

    There have been some shockers here, but that must be close to the most racist comment ever posted on this blog RB, even if it is (and I’m uncertain from your post) a quote.

    Not just racist, but factually incorrect in the presumption that Maori were primitive and uncivilised. In fact, the colonist initiated Land Wars and subsequent colonist confiscation of legitimately owned Maori land would indicate that it was the colonists, rather than the tangata whenua, who were uncivilised.

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  41. Redbaiter (13,197 comments) says:

    “it was the colonists, rather than the tangata whenua, who were uncivilised.”

    See Toad there you go again. Dismissing my arguments by labeling me a racist. You’re acting just as I have outlined above.

    BTW Toad, since when has cannibalism been recognized as an attribute of a civilized community?

    Here’s some words from a Maori for you to chew over-

    If you guys hadn’t come to New Zealand,” Te Heuheu told TFR, “It’s highly likely that Maori wouldn’t have survived. We were stoneage. We were illiterate, and that’s the truth. We’d just about eaten everything there was to eat; the moa was already extinct, and we were eating each other. We would have killed each other off. Now we have the best of everything in the world. While Maori are running around screaming that we’ve been ripped off [by the European] they’re taking advantage of high-tech this and high-tech that. They’re demanding millions of dollars in compensation, plus apologies, and white liberals are sucked into this bullshit.”

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  42. big bruv (13,884 comments) says:

    Toad

    “I’ve got a better idea. Why don’t you go to Zimbabwe to live, and leave us NZers to live as we always have – i.e. without dictatorial domination”

    That is hilarious, in a “Green” NZ we would be totally controlled by the government, anything the Greens did not like would be banned, is that not dictatorial domination?

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  43. bwakile (757 comments) says:

    Toad,
    One day, unfortunately when it is probably too late for you to do anything about, reality will come up and bite your Utopian dream on the arse.

    I am sure you are welcome here preaching your misguided thinking, but don’t think that people are going to buy into your dreams just because you think they are a good idea.

    Your thinking always misses the most important point, human nature loves freedom.

    I actually admire your dedication, it’s just a pity you don’t put that energy into something constructive.

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  44. Redbaiter (13,197 comments) says:

    “That is hilarious, in a “Green” NZ we would be totally controlled by the government,”

    Think North Korea, with the indoctrination of school children being the key strategy.

    Its already happening here and its a damn soviet disgrace.

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