More on Dotcom

March 29th, 2014 at 12:00 pm by David Farrar

The Herald reports:

Kim Dotcom has paid back about $400,000 of up to $900,000 he owes to creditors — but one sees the late payment as a public relations ploy.

Which it is. He could have paid them years ago.

Paul Davis supplied uniforms to the staff at the Dotcom mansion and is one of the creditors who spoke publicly to the Herald last month. He was owed $1138 and said yesterday he was paid as promised.

“But I don’t think it’s his conscience. We had absolutely no movement on this for two years until the Herald story and the TV stations following up. It was pressure which was needed, so I think he’s desperately trying to get some good PR.”

He certainly needs some.

Millions of dollars of assets were seized in raids and Mr Dotcom did not have a legal obligation to pay the debts of the limited liability company.

But creditors became more frustrated in recent months as Mr Dotcom started a high-profile marketing campaign for his Good Times album, took helicopter trips to the Rhythm and Vines music festival and a weekend at Huka Lodge and started the campaign for his Internet Party.

A lack of funds was also cited in the departure of Wayne Tempero, Mr Dotcom’s longtime bodyguard, who was being paid half of what he was getting before the raid.

Mr Dotcom has since obtained an injunction to stop Mr Tempero giving a tell-all interview, and four security guards who worked for the tycoon are also believed to be about to file proceedings in the High Court to seek backpay.

That will be interesting, as they claim they were effectively paid under the minimum wage. This court case could happen at the same time as the Mana Party does a deal with them, which will tell us a lot about how deeply Mana cares for low wage workers.

Fran O’Sullivan writes:

Kim Dotcom bought his New Zealand residency with a $10 million cheque; now he wants to buy off Hone Harawira to try to secure the balance of power at the September election.

Hone’s price is much cheaper.

Nor the fact that Dotcom owns a signed copy of Adolf Hitler’s Mein Kampf. So what? Mere ownership doesn’t make him a Nazi sympathiser. (I own a Chinese tract signed by the disgraced Bo Xilia and that doesn’t make me a Communist either).

This issue will remain a red herring unless evidence is made public — not merely hinted at — that Dotcom is a closet Nazi and anti-Semitic to boot.

It’s the combination of the book, the flag, the helmet and the testimony from his former friend.

What Dotcom is offering is a gift. Money and resources for a shared tilt at power.

The big question is whether Harawira sticks to the principles on which he founded the Mana Party, or sells out to Dotcom in a naked dirty deal to get more seats in Parliament.

Of course he will sell out.

John Armstrong also writes:

To help the left remove John Key, the internet mogul has to attract voters that are beyond the reach of Labour and the Greens. Indeed, the best chance for the Internet Party to establish itself as a viable political force and (eventually) get anywhere near the 5 per cent threshold is to position itself in the centre of the political spectrum or slightly to the right, just like New Zealand First, but targeting a much younger catchment of voters.

Instead they’ll mainly take votes of the Greens I’d say.

That he is willing to contemplate a vote-sharing deal with Hone Harawira’s Mana Party is tacit admission that Dotcom knows he will not beat the threshold in September’s ballot. But taking advantage of Harawira’s hold on a threshold-removing electorate seat comes at what may be a heavy, even crippling price.

Harawira made it a precondition of further talks on such a deal that Dotcom commit himself to not working with Key and National post-election.

The immediate impact of that is to drastically cut any leverage — and thus appeal — that the Internet Party might have had if it had taken the same position as New Zealand First and hedged its bets on whether it would back a Labour-led or National-led Government .

Can you imagine a Labour-Green-NZ First-Mana-Dotcom Government!

Even more dangerous in political terms is the suspicion — quickly fuelled by National — that Dotcom’s purpose in setting up the Internet Party is solely to make it a bottom-line of any post-election talks that whoever is Minister of Justice quash any court ruling which would force his extradition. Such a bottom-line would be preposterous and would amount to Dotcom’s party being the sickest joke played on New Zealand voters.

I believe that is the of course the major intent of the party.

Every day that Dotcom deprives Key’s other opponents of the oxygen of media coverage is one day closer to election day on September 20. It is one day less for the real election issues and priorities to take centre stage.

National’s opponents can complain all they like. But the never ending Dotcom saga is a freak show of epic proportions with ever more twists and turns. The media simply finds it impossible to avert its eyes.

Yep, he is starving them of oxygen.

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Fran on Dotcom and Brown

February 22nd, 2014 at 4:00 pm by David Farrar

Fran O’Sullivan writes in the NZ Herald:

Kim Dotcom and Len Brown are linked by several personal characteristics. Both are showmen. Both are prone to vanity. Both hate being out of the limelight.

In the personality world that drives mainstream media coverage these days, each of them is also a long-running news story.

This week, each man was under a new round of pressure.

Dotcom because the Court of Appeal found the police raid on his rented mansion was legal (but that the police giving the FBI the seized material was an unauthorised legal breach). The Herald’s splash showing Dotcom (or his companies) had not paid a number of small creditors while he ostentatiously lived high on the hog did not help his reputation.

But his natural audacity and fighting spirit keep him centre-stage.

Brown is also endowed with fighting spirit. He has a thick hide when it comes to public opprobrium. He was booed at the Auckland Nines and was asked not to attend a community military tattoo this weekend.

Maybe they could swap roles? Dotcom goes to all the public events, and Brown sets up a new political party? :-)

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A tale of two Cunliffes

December 28th, 2013 at 11:00 am by David Farrar

Fran O’Sullivan writes:

Cunliffe also uses an essential duality – which has been accurately pin-pointed as “talking out of both sides of his mouth” – to try to assuage middle-class and politically adept New Zealanders that he doesn’t really mean all the tosh he threw as bait to Labour’s bedrock base to garner voting support during his leadership campaign.

What fascinates and frustrates is that it is difficult to work out which side of Cunliffe’s mouth will triumph if he ends up this time next year as Prime Minister.

Will it be Raging Red Cunliffe or the former consultant for Boston Consulting Group?

But at year’s end, Labour under its new leadership is no further ahead in the political polls than it was at the start of the year.

The pendulum has swung back again towards National, with the optimism indexes showing much of the country in good heart and the Government poised to post a return to Budget surplus next year.

The problem facing Cunliffe is how he can convince enough voters the country is on the wrong track given the resurgence in economic growth. This growth will continue into next year as a result of a range of factors including Auckland’s housing boom, big demand for dairy exports, the Christchurch post-earthquake rebuild, immigration and the favourable terms of trade.

Overcoming this is no easy feat for any politician even one as experienced and competent as Labour’s leader.

My predictions – lots of tax and spend promises.

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Fran on why the Auditor-General should investigate

December 21st, 2013 at 12:00 pm by David Farrar

Fran O’Sullivan writes:

Auditor-General Lyn Provost is the right person to take inquiries into Len Brown’s relationship with the SkyCity hotels and casino operator to the obvious next stage.

The mayor of Auckland has attempted to brazen his way through the embarrassing detritus exposed by the EY (Ernst & Young) report into some of the implications of his two-year affair with Bevan Chuang.

But that report, emasculated as it was after legal negotiations between Brown’s lawyer and the Auckland Council’s QC, has put new material on the table which must now be investigated by the Auditor-General herself.

I agree.

But in the Auditor-General’s case there is a firm basis on which to make more inquiries of Brown, the mayor’s office and SkyCity. The EY report is fact-based. But it also suffers from the obvious limitation of being a report commissioned by Auckland Council CEO Doug McKay into his boss.

Provost is not constrained by any such relationship and, importantly, has the power to inquire and make relevant comment.

The EY report established some useful facts, but didn’t cover many things. For example there was no asking of the Auckland Art Gallery whether or not the Mayor’s reference was the major reason Chuang was hired.

The EY report – as published – shies away from disclosing whether Brown solicited any of the nine freebies he had in four city hotels or requested any of the 64 upgrades.

The impression by Brown’s public comments is that his wife, Shan Inglis, made most of their hotel bookings.

But it stretches credibility to believe Inglis would have made the booking for her husband’s rendezvous with Chuang in a SkyCity hotel bedroom.

Especially as rumour has it that some of the bookings were for the day, not the night!

EY saves the mayor some embarrassment by failing to distinguish between Brown’s overnight stays and his daytime stays in hotels. A footnote to the report simply says “room nights refers to both night stays and day stays”.

It is unclear whether these so-called “room nights” cover the pop-in arrangements that Brown was said to have when a room was sought for a few hours for him to get away from the pressures of the office.

Pressures of the office?

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Fran O’Sullivan on Len Brown

December 14th, 2013 at 1:00 pm by David Farrar

Fran O’Sullivan writes in the Herald:

If he had any skerrick of honour left, Len Brown would by now have tendered his resignation as mayor to the people of Auckland.

It is absolutely clear that Brown has obtained multiple private benefits by virtue of his position as Mayor of Auckland.

It’s now time for Auditor-General Lyn Provost to open up a much wider inquiry to satisfy Aucklanders – and New Zealanders at large – just where Brown’s abuse of his position stopped.

Brown is a lame duck and has no chance of getting re-elected. He is just going to take the salary for the next three years.

But the real issue – as I have opined before – is how the Mayor of Auckland obtained special benefits for himself by virtue of his position, especially the $6130 of “freebie” hotel rooms disclosed in the EY report. Then there was the $32,888.50 worth of free hotel upgrades revealed by EY yesterday.

And more: the use of the mayoral car to squire his mistress about town; introductions of her to high-level Chinese visitors as his unpaid “translator”; the undisclosed gifts; the rearranging of his official overseas itinerary to squeeze in a private dinner in China with an unnamed female guest and a mayoral staffer.

As it turns out, she was a personal friend the mayor had requested to provide what proved to be unpaid translation services on the Guangzhou extension of his trip, and the staffer advised EY she had “no recollection of the dinner or attending diner” that was paid for by the council.

These issues have been barely mentioned by other media.

Frankly, accepting nine “freebies” at prime Auckland hotels – three of them at hotels belonging to SkyCity – doesn’t cut it. It is not merely “embarrassing” but is improper behaviour, given the fact that the council has had to adjudicate on controversial issues around the SkyCity Convention Centre “pokies swap” deal where the mayor clearly needed to be seen to be above the play and not putting himself in a position where he could be subject to unconscious bias, or more.

If he was a Minister of the Crown, Labour would have insisted he resign by now.

Brown has clearly flouted Auckland Council disclosure guidelines and general standards. This is symptomatic of a politician who believes he is above the rules. The fact that he was a “no show” at yesterday’s press conference indicates Brown has no answers outside the carefully crafted but ridiculous spin that his bevy of well-paid mayoral office press people have been churning out in recent days to try to deflect attention from the damaging findings in the review.

The TV interviews were so lame, that I wonder what has happened to interviewing skills. Did anyone confront him over his confirmed lies to the media? His communications director said (on the basis of what Brown told him) that he accepted no free hotel rooms when staying with Chuang.  That was a lie, and has been exposed as such.

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Fran says Bring Back Goff

July 27th, 2013 at 12:00 pm by David Farrar

Fran O’Sullivan writes:

Shearer’s fortunes were not helped by the latest TV3 poll in which Labour slid 2.1 per cent to a 31 per cent rating. The results will inevitably increase tensions with the usual suspects calculating what leadership permutations might work if Labour continues its poll slump and its leader – now on to his third chief of staff – can’t lift his game.

The permutations of different leadership combinations: Deputy leader Grant Robertson, David Cunliffe, Andrew Little and Shane Jones all in the mix together with David Parker for the top trio of roles: leader, deputy leader and finance spokesman.

They all have important attributes.

But personally, I’ve never been able to understand why Labour MPs chucked Goff out so quickly after the 2011 election. He has always been an excellent performer and would have driven hard against Key over the past 18 months and made the dents Shearer couldn’t.

It probably gets up Labour’s nose to say so but there is no reason to throw out a seasoned performer (who is clearly light years better than many of his colleagues) simply because he has been in Parliament since his 30s.

Let’s face it, John Howard – who like Goff was a Cabinet minister – before becoming Leader of the Opposition then being rejected by colleagues, rose again to take the Australian Liberals through to win the 1996 election and reigned successfully as Australia’s Prime Minister for four terms before being thrown out of his own seat.

So Fran seems to be saying Labour should go back to Goff.

I think this is unlikely, but not impossible.

They key is that the caucus is shit scared of having a membership-wide vote, in case Cunliffe wins it. So Shearer will only go when a deal is worked out (if it can be) between Robertson, Little and Cunliffe.

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All about the man ban

July 6th, 2013 at 1:00 pm by David Farrar

Lots of commentary on Labour’s proposed man ban.

Colin Epsiner writes at Stuff:

Oh dear. I really didn’t think it was possible for Labour to top its own goal over the Sky City corporate box debacle. But it has. 

After a week where the Government ought to be on the back foot over the GCSB saga, Auckland’s nutty property market, and the death throes of one of its coalition partners, Labour has come out with a policy so politically barmy it makes you wonder whether it really has any interest in winning the next election. …

David Shearer has – after initially stating the policy had “some merit” – realised he’s dealing with a political bomb and come out against the policy, saying he favours targets rather than quotas. Senior Labour MPs Phil Goff, Shane Jones, and Andrew Little immediately recognised the damage the proposal would do and have denounced it too. 

But it may be too late. This idea needed to be taken out and quietly shot before it ever saw the light of day. From now until it’s debated at Labour’s annual conference in November, Labour’s opponents will have a field day. 

The Opposition needs to be talking to the electorate about jobs, housing, incomes, and hip-pocket issues. Not navel-gazing about its gender balance. The public, to be frank, doesn’t give a toss whether Labour has 41 per cent women MPs or 50 per cent. They just want good candidates and good policies. 

Adam Bennett at NZ Herald reports:

No Labour MPs other than Manurewa’s Louisa Wall will publicly back a proposal to have women-only selection short lists for some electorates to boost female MP numbers.

After his initial reluctance to comment earlier this week, party leader David Shearer has now come out against the proposal.

Outspoken male MPs Shane Jones and Damien O’Connor panned the idea in no uncertain terms, warning it risked driving away socially conservative blue-collar voters.

Of Labour’s 34 MPs, only Ms Wall has been prepared to publicly support it since it was revealed on Thursday.

Eleven, including Mr Shearer, have said they don’t support it or are yet to be convinced.

But is David Shearer not a member of the NZ Council that has proposed this?

So either he got rolled at the NZ Council meeting, or he has flip-flopped and was for it before he rages against it.

Fran O’Sullivan supports it though:

Congratulations to Party Central for putting gender equality ahead of diversity when it comes to the ranking criteria for selecting the next crop of Labour MPs.

Quaintly, the notion that a 21st century political party might opt to use its selection process to try to make sure that as many women as men represent us in Parliament has been met with howls of derision and barely disguised outrage.

That’s just on the Labour side of politics. Let’s point out here that the most vocal MP opponents (Yes, I am talking aboutyou, Shane Jones and you, Clayton Cosgrove) are only there themselves by virtue of their list rankings.

John Armstrong writes:

When you are in a hole, you can rely on Labour to dig itself into an even deeper one beside you – as it did this week with its shoot-yourself-in-both-feet potential change to party rules to allow women-only candidate selections.

This was not solely political correctness gone stark-raving bonkers. Apart from alienating one group of voters who have drifted away from Labour in recent years – men – such a rule change would be just as insulting to women in insinuating they could not win selection on their own merits.

The proposal should have been kiboshed by the leader the moment he saw it. That he didn’t – or felt he couldn’t – points to deep schisms in the party.

The message voters will take from Labour’s warped priorities is that of a party which cannot get its act together in the snoozy backwaters of Opposition, let alone in the blazing sun of Government.

There is a reasons this never emerged under Helen Clark. She would have strangled this before it was born, even if she privately backed it.

Bryce Edwards has collected some of the best tweets on this issue. Here’s a few:

Bernard Orsman ‏@BernardOrsman

The ‘man ban’. Can things get any worse for Labour. PC madness. @nzlabour

James Macbeth Dann ‏@edmuzik

David Shearer is against the quotas. That should guarantee they get passed

Perfect Mike Hosking ‏@MikePerfectHosk

The Labour Party manban makes no sense at all. It’s like saying “drinkable organic wine.”

Patrick Gower ‏@patrickgowernz

Labour Party wants a quota system for MPs based on gender etc – not merit. Apparently this isn’t a joke.

Michael Laws ‏@LawsMichael

Labour’s next caucus rule – seats reserved for the disabled, the mentally ill, overstayers, gays, vegetarians, the over 70s, the under 20s.

Philip Matthews ‏@secondzeit

@harvestbird Over a couple of beers with my mates building a deck, we decided that the manplan has set progressive politics back decades.

Julian Light ‏@julianlight

Went for a coffee this morn but was refused service. Not enough women had bought a coffee. Seemed about as fair as Labour’s policy #manban

Aunty Haurangi ‏@_surlymermaid

Upside to the #manban : Less likely John Tamihere will get an electorate seat.

Keeping Stock ‏@Inventory2

Sean Plunket describes the #ManBan as “a completely co-ordinated attack by the Labour Party on itself”; and he’s spot on.

Ben Uffindell ‏@BenUffindell

@LewStoddart More women MPs just for the sake of more women MPs is not a noble goal. Sexism lies in the population at large.

Cactus Kate ‏@CactusKate2

50% of houses should b owned solely by women n we should hv zero interest loans 2 fund this #manban

Finally we have Chris Trotter:

AMIDST ALL THE CLAMOUR of its detractors, the true significance of Labour’s “Man Ban” has eluded most commentators.

Yes, the proposed rule change has undoubtedly damaged Labour’s election prospects.

Yes, there are many more important issues the party would have preferred the news media to focus upon.

Yes, it is further evidence of a party with no reliable political grown-ups in charge.

Yes, Labour’s opponents will dine out on it for months.

And, yes, it’s the only thing the 2013 Annual Conference will be remembered for.

But, the “Man Ban” is also proof of something else: that the distance separating Labour’s rank-and-file from Labour’s Caucus has grown as wide as the gulf that once separated the “old” Labour Party from the “new”.

The conference in November should be spectacular!

 

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John and Fran on John

June 29th, 2013 at 3:10 pm by David Farrar

John Armstrong writes in the NZ Herald:

National’s decision – very much John Key’s decision – to bite the bullet and set a 2020 start for building the $2.9 billion Auckland City Rail Link is a political masterstroke.

Once again. Key has trumped National’s opponents and neutralised the political advantage they had held by jumping across the political divide and setting up camp in their territory.

He first did it with nuclear ship visits when he became National’s leader in 2006. He simply used his honeymoon in the job to declare the anti-nuclear law would remain intact under his leadership. And that was that. It may not have greatly impressed the Americans. But in an instant, a political millstone had been removed from National’s neck.

On numerous occasions since, Key has likewise swallowed hard and taken positions which do not sit that comfortably with National ideology but which spike the guns of the party’s enemies and leave them with nowhere to go.

Regardless of the merits of the City Rail Link (and I actually think it does have merits), one can look at this in a very calculating way.

The Government has said it will fund it by 2020. It is unlikely this Government will actually be in power in 2020, so the actual funding for it will be an issue for the future. The announcement though gives certainity.

If they had not announced future funding for it, well what is the probability that there will not be a change of Government before 2020? Very very low. Even Labour can’t get stuffing up for that long. And if a change of Government means it would then be getting built anyway, well what is the point in holding out?

But there are other advantages. By agreeing to it now, it removes the ability of Labour and Greens to sabotage the Puhoi to Wellsford motorway extension which they were promising to scrap to fund the CRL. Are they now going to keep campaigning on scraping what they call the holiday highway? I doubt it.

So yes, a masterstroke – and one that doesn’t really impact the books long-term as it was inevitable it would be built anyway when there was a change of Government. Instead, it now happens on a more affordable time-frame.

With yesterday’s confirmation of a tunnel as the second harbour crossing plus sundry motorway extensions and developments, Key has mapped out National’s vision for Auckland transport and, perhaps more importantly, laid out the stages by which that vision will be achieved.

In one swoop, he has taken the steam out of what, after housing affordability, is the thorniest issue in the country’s biggest city – traffic congestion – and one on which, according to opinion polls, National’s management has less than impressed the public.

In particular, Key has now marginalised Labour and the Greens in the one aspect of public policy where those parties thought they safely had it all over National – public transport.

Armstrong also points out:

Apart from shoring up National’s support in Auckland, the go-ahead is intended to remind the rest of New Zealand that National – unlike its opponents – looks at the big picture and gets things done whereas they are consumed by the relatively trivial, such as the fate of Peter Dunne and his parliamentary allowances.

And their obsession with the GCSB. Don’t get me wrong – the GCSB is of importance, but it seems the opposition have talked about nothing else for the last few weeks or months. The average family really does not care that much about the GCSB. They care about having a job, a growing economy, better schools and better healthcare.

Fran O’Sullivan also writes:

John Key’s lip-smacking munificence has been writ large as he moves into agenda-setting mode in Auckland and Christchurch, the two cities that will decide next year’s election.

Key’s spreading plenty of pixie dust about, promising multi-billion-dollar transport projects in Auckland – including the City Rail Link which his transport ministers have seriously dissed – and big-ticket projects in earthquake-savaged Christchurch, like a new convention centre.

I joked on Twitter that John Key has spent more in one week than Rob Muldoon spent in nine years on Think Big!

But the comparison, even joking, is unfair. The transport projects are not (generally) being funded by taxpayers. They tend to get funded out of the national land transport fund which is basically user pays funding through petrol tax and road user charges.

Labour’s Auckland issues spokesman, Phil Twyford, was yesterday reduced to carping about the cost of the city’s transport projects and complaining that the timing for some of the construction was still vague.

Which they are, but they allow the planning to begin such as route protection for the harbour crossing.

But he later confined himself to telling journalists it could come from various sources, including (take that, Labour!) the Future Investment Fund, into which his Government is tucking the proceeds of its partial privatisation programme; the Land Transport Fund, which holds the proceeds of petrol excise tax and road-user charges; taxpayers through the Consolidated Fund and even the private sector through some nifty public/private sector partnerships (PPPs).

I think using the proceeds of asset sales to help fund the CRL would be wonderful! Labour then has to argue that shares in a power company are more valuable than the CRL!

And Christchurch mayoral challenger and Labour MP Lianne Dalziel was reduced to complaining from the sidelines as Key and Canterbury Earthquake Recovery Minister Gerry Brownlee cosied up publicly with Parker to announce agreement had been reached on $4.8 billion of investment in Christchurch – $2.9 billion of it coming from the Crown and $1.9 billion committed by the Christchurch City Council – so that projects like the new stadium and a convention centre can proceed.

Key couldn’t resist having a flick at Labour during yesterday’s stand-up, telling reporters he could understand why the public wasn’t warming to Labour because it was “too negative”.

Labour need to learn that endless negativity is not appealing.

The big question is how much further the PM will drive the knife in; particularly as speculation has now been sewn that Labour leader David Shearer has been given two months to turn his party’s dismal poll showing around or face questions over his leadership.

The parallels with Australian Labor leader Julia Gillard are obvious. Their respective publics warmed to neither of them.

The posturing was obvious at the US Embassy’s Independence Day festivities (celebrated early) in Wellington on Wednesday night.

Shearer and two potential leadership pretenders – Grant Robertson and David Cunliffe – maintained a studious distance from each other.

Tick tock, tick tock …

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What bad timing

June 15th, 2013 at 1:00 pm by David Farrar

Fran O’Sullivan writes at NZ Herald:

David Shearer, Russel Norman and Winston Peters will have an opportunity to present themselves as the “government-in-waiting” when they turn up to HamiltonJet’s premises on Monday to release the results of their parliamentary inquiry into the future of manufacturing.

What awful timing for them. On Friday the Performance of Manufacturing Index hit a ten year high, and on Monday the three parties will have to proclaim how manufacturing is in crisis and dying.

Mechanisms to deal with an “overvalued and volatile dollar” – which include making the dollar and jobs additional priorities for the Reserve Bank,

Again, what bad timing for them as the dollar has dropped by around 10% in the last few weeks.

Over a four-year period manufacturing jobs have fallen by nearly 40,000 (16.7 per cent); the number of manufacturing businesses has dropped by more than 1300 (6.1 per cent); the annual value of manufactured exports was down by 12.4 per cent; and manufacturing profits fell by 17.4 per cent.

Fran doesn’t say which four year period though. In the last four years the Household Labour Force Survey shows 255,600 manufacturing jobs in March 2009 and 246,200 jobs in March 2013 which is a decline of 9,400 – not 40,000.

Now any decline is not good, but 9,400 is one quarter the size of the 40,000 the Greens stick around.

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Armstrong on Greens

June 10th, 2013 at 12:00 pm by David Farrar

John Armstrong woke at the weekend:

Norman appeared to offer further evidence of that later in the week when he rounded on the chairman of the Electricity Authority, Brent Layton.

National Party-aligned bloggers were not the only people asking in the wake of that attack who was being Muldoonist now.

Norman’s curt response to Layton’s detailed critique of the joint Labour-Greens plan to reform the wholesale electricity market was pretty tame stuff, especially when placed alongside Winston Peters’ slow evisceration of Peter Dunne.

However, Norman’s attack struck a discordant note coming as it did only days after the Greens’ co-leader had accused John Key of vilifying and bullying his critics in a manner which was as divisive as that of the late Sir Robert Muldoon.

Norman’s rejection of Layton’s 28-page paper, which sought to demolish the Labour-Greens’ notion of setting up a single institution to set wholesale electricity prices, was also in marked contrast to the rebuttal by Labour’s David Parker. The latter challenged Layton’s arguments one by one in a measured tone.

That was the point. Parker showed how to disagree on policy grounds. Norman made it personal, and nasty. Becoming a habit.

Norman’s statement was far more belligerent with a number of references to Layton as a “National Party appointee” to a “National Party-created” regulator.

Layton is no National Party hack, however. He is a highly-respected economist with extensive knowledge and experience of the electricity generating industry over many years.

Indeed Dr Layton is a highly respected economist. He was the director of the non-profit NZIER economics co-operative for five years. Dr Norman’s PhD was on the history of the Alliance Party. Dr Layton’s was on economic history.

I doubt there is an economist in NZ who has done more work in the electricity sector. Dr Layton looks to have done 20 or so reports in the 2000s, for the Major Electricity Users Group (the ones who benefit the most from reliable supply, cheaper prices and better competition).

Fran O’Sullivan also writes:

Russel Norman exposed himself as a “Muldoonist” when he slammed into highly respected economist Brent Layton this week for daring to raise his head above the parapet and defend the work of the NZ Electricity Authority, which he chairs.

Norman was clearly incensed that Layton had issued a paper on the economics of electricity that laid waste to the arguments of three critics of the current regime, and challenged the proposal by the Greens and Labour to set up a new entity – NZ Power – to effectively control prices.

But by slagging Layton off as “nothing more than a National Party-appointed civil servant who has failed to do his job and is now trying to protect his patch”, Norman was straying well into the territory of personal attacks that Sir Robert Muldoon made an art form, and demonstrating a predisposition to a form of political management the Greens co-leader claims to despise.

Long may Russel keep it up. Once a brand is damaged, it is very hard to repair it.

And there would be few people in the Wellington political firmament who would have missed the underlying message sent by the NZ Institute of Economic Research when it issued a short-form CV yesterday under the simple headline: Background: Dr Brent Layton.

The release simply noted the many roles Layton has held: chairman of the electricity market rules committee, a director of Transpower and M-Co, former chairman of Trust Bank Canterbury, a director of the Futures Exchange, deputy chairman of the Institute of Geological and Nuclear Sciences, chairman of Lyttelton Port Company, chairman of Canterbury Health and also AgResearch and its commercial arm Celentis. Currently, He chairs Sastek, a Brisbane-based hardware manufacturing and software development company. And he has also been one of two external monetary policy advisers to the Governor of the Reserve Bank.

In other words: frame that up against a PhD on the Alliance and a working life spent mainly in Parliament? There is no real comparison.

One can disagree with Layton’s analysis and conclusions. But to label him as basically a failed hack was unworthy.

 

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O’Sullivan on power nationalisation

April 20th, 2013 at 11:47 am by David Farrar

Fran O’Sullivan writes in the Herald:

The ghost of Hugo Chavez is alive and thriving within the Labour Party as it turns its back on its free-market past to buy itself back into power courtesy of the taxpayers’ chequebook.

And not just nationalisation, but free electricity!

If David Shearer and Russel Norman muster enough votes to win the next election, they say they will toss us all the equivalent of a free 300KW block of electricity

Just as the Greens think you can print money, they and Labour also think you can just give electricity away for free, and somehow new generation will be built.

We are asked to believe this policy will also produce 5000 new jobs and generate $450 million worth of new economic activity because two pages of bare analysis on Berl’s equilibrium model tells us so.

I don’t think so. No one with any residue of grey matter left will believe Shearer’s protestations that the timing of this joint announcement has nothing to do with the pending Mighty River Power IPO.

This policy has all the signs of being rushed out with one aim in mind: To spook the private investors (including the many smaller shareholders who are being enticed back into a New Zealand sharemarket, which was on the verge of its own demise a few years back) who are lining up to buy shares in the forthcoming float.

Indeed.

But the decision to insert a state-owned monopsony – or monopoly buyer – called New Zealand Power between the supply and demand sides of the electricity industry without first undertaking any stringent analysis and submissions from existing privately listed companies like Contact Energy, TrustPower, Infratil and the privately owned Todd Energy really amounts to nothing more than effective renationalisation of the competitive sector.

And why are they nationalising them? Because they hope it will gain votes?

But what is really instructive from the BusinessDesk report (a good scoop, by the way) is Jones’ admission that not only do asset owners need dividends but “politicians need dividends as well”.

The report went on to note that to win the 2014 election, Labour needed to move about 5 to 7 per cent of the voting public to favour it.

Jones suggested energy analysts’ capacity to “make 5 to 7 per cent of the public hate us [because of this policy] is zero. Our capacity to impress that percentage [with this policy] is infinite”.

In other words, the sniff of power is so enticing to Jones that he is prepared to give away the return on state-owned assets to consumers to bribe his party’s way back to power.

Their next policy may be to announce that if you have more than one house, the government will confiscate it and give it to an aspiring home owner.

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Fran lashing out

December 14th, 2012 at 8:04 pm by David Farrar

An update to the post on The Nation, as Fran O’Sullivan has been adding up 2 and 2 to get five.

I saw (I think on Twitter) a reference to a story saying The Nation was not being funded next year by NZ on Air. I followed the link to a website I had never seen before called NZ Inc. The story seemed definitive “news spread last night that The Nation has missed out on funding for 2013so I blogged a story on it. I did the story at 9.18 am and set it to appear at 2.00 pm. Most of my stories are done earlier in the day and then set to appear later.

I didn’t even note on the website whom the author was, and as I said the site was previously unknown to me.

I then left home to go to Te Papa for the preview of their Gamemakers display (opens tomorrow).  On the taxi ride there at 11.55 am I saw a comment by Fran O’Sullivan that The Nation will be back in 2013 and she stands corrected. I took this to mean that TV3 would be funding it, but then saw a further comment that NZ on Air was in fact funding it.

I then commented that this means the NZ Inc report was wrong, and I must go change my blog post lamenting it set for this afternoon.

That was the intention. I wasn’t sure what time it was set for exactly (as I do 10 a day), but anyway by the time I finished at Te Papa and headed to the airport, it was just after 2 pm when I got to go into the blog to edit the post. I do Facebook and Twitter easily from the iPhone, but significant editing of a blog post on a phone is incredibly difficult to do.

I got to the Koru Club, started up the laptop, and found that the post had already appeared, which annoyed me as I preferred not to run incorrect information.

I did a quick update to the blog the post at the top, stating the report was wrong and expressing some mild displeasure that the site I quoted hadn’t lived up to their tagline. It was only as I did that update I even realised that Fran was one of those behind the site.

Anyway Fran then lets loose on Facebook claiming my post was a “bitchy little hissy fit“,  and I was “just being an asshole cos he can be” and “He is just wanting to snipe from the sidelines. Nasty and stoking ill-will in an ill-advised manner.”

The irony may not escape people of Fran claiming I was being the nasty one.

I responded to Fran explaining the post was pre-timed, but she then effectively called me a liar. I have absolutely no time for people who doubt my word, and behave like that.

Fran doesn’t seem to have considered that if I really was wanting to damage her (and God knows why she thinks I am someone who would want to) then I would hardly have posted on her Facebook page noting the correction and saying I plan to change my blog entry. I could have said nothing at all. I could have rushed the post forward to do maximum damage, so that it got out there before the corrected version did. Her interpretation is ridiculous when you consider I made the comment myself that I planned to update it.

Sure I could have in the update acknowledged that the discovery that the story was wrong, had occurred a couple of hours earlier, but it doesn’t change the fact it was wrong and I didn’t think it was material what time the error was discovered. My commenters had already caught on that the story was wrong, and the link went through to the corrected story.

At the end I’m just surprised that Fran has such a thin skin, and turns so nasty when it is her who ran an incorrect story. We’ve all run stories that have proven to be incorrect. I don’t even mind pushback that the correction could have referred to the time, but as I said I detest people who call me a liar. I never ever will say something I know to be false (usual disclaimer around jokes, pranks etc), and as far as I know this is the first journalist to ever claim otherwise.

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Pundits on Labour

November 24th, 2012 at 3:00 pm by David Farrar

Duncan Garner, Fran O’Sullivan and John Amrstrong all write on Labour this weekend.

First Duncan:

Dissent. Uprisings. Rebellion. Scraps. Blood.

It was something Helen Clark kept a careful lid on. 

Not even on her weakest day or in a moment of madness would Clark have given up control of who picks the leader of the proud Labour Party – never, ever.

Caucus must control its own destiny.

What happened last Saturday would never have happened under Clark’s strong leadership. Now the Labour leader can get rolled and rolled easily.

If a minority of 13 other MPs out of 34 decide to support Grant Robertson or David Cunliffe next February, then that triggers a party wide vote.

Actually I think it is even worse than that. I have not seen the final rule, but I don’t think a contender even needs to challenge. The vote is basically just a confidence vote in the Leader. Someone could just quietly encourage 14 MPs to vote no, and bang there is a leadership ballot – and only then do contenders have t step forward.

During that vote, party members get a 40 percent say and unions get a 20 percent say. You reckon they’ll hang on to David Shearer in that scenario? Doubt it. And it’s like that every three years.

If Shearer lost the Feb caucus vote, I don’t think he would even contest the party wide ballot. He’d be impotent in Parliament while he has to fight a rearguard action to stay on as Leader. I think he would bow out.

The February following each election, Labour will be able to boot out their sitting leader – that leader may have just months earlier been crowned Prime Minister.

So when you vote for Labour, you don’t know who you will end up with as PM.

It’s a recipe for instability. Quite frankly it’s a disaster, a train-wreck waiting to happen. …

If the 40 percent caucus vote and 40 percent party member vote cancels each other out – i.e the caucus wants a change but the party members don’t, then guess who has the casting vote?

The unions. They get 20 percent.

Could the unions select the next Prime Minister? Yes. Could they dump a sitting Prime Minister just two or three months after they took office?Yes.

By this move, Labour have become even more subservient to the unions.

And now Fran O’Sullivan:

Four days on from Cunliffe’s execution, there is little sign that Shearer is on top of his game.

His post-caucus press conference was a bumbling, mumbling mess which at times bordered on total incoherency.

It was a shocker.

It does not bode well for Labour to have its own leader so frightened of his own shadow that he has to banish one of his few competent colleagues to the back bench.

Unfortunately, Shearer was also simply not politically tough enough, nor sufficiently competent and astute, to have pulled off the accommodation that Australian Liberal Leader Tony Abbott made with potential rival Malcolm Turnbull this week to position his party to win the next Australian federal election.

I blogged on this yesterday. A much smarter way to handle a more popular rival.

In Shearer’s case he does not have the skill to bring off an accommodation with Cunliffe. (Though in months to come he may wish he had gone down that path instead of listening to the caucus players who want the New Lynn MP buried at all costs).

The old guard remain in charge.

And John Armstrong pulls no punches:

Barmy, loopy, stupid, crazy. Last weekend’s Labour Party conference had so much political madness on and off the conference floor that the proceedings could well have been deemed certifiable.

The handful of MPs who tried to talk sense into delegates may agree – particularly on the vexed question of how high to set the bar before a leadership ballot involving the whole party membership is triggered.

The MPs’ advice was not only ignored, they were shouted down. The rank-and-file saw things very differently. The rewrite of the party’s constitution was giving them a rare whiff of grass-roots democracy. They were not about to say “no thanks” even if their votes were being manipulated for nefarious reasons.

All I’ll say is I can’t see National rushing off to make similar changes.

I guess in Labour the desire for more of a say is understandable, as members have traditionally only a very weak say in even electorate selections.

From now on, the leader will be subject to a post-election endorsement vote by the caucus which must take place no later than three months after polling day.

Failure by a leader to secure more than 60 per cent backing from his or her colleagues will trigger a leadership vote involving the whole party.

The upshot is National will spend the election campaign delightedly claiming the Labour leader cannot guarantee he or she will still be in charge three months after the election.

Moreover, the new method of electing the leader gives a slice of the action to affiliated trade unions. You can imagine how National will exploit that.

Oh, yes.

I actually the the principle of giving members a say is laudable. But giving unions 20% of the vote is not far off organised corruption (just look at the Australian unions for examples of what they do with the extra power) and having a threshold below 50% for a challenge is silly.

When they were not naively setting things up to the advantage of the old enemy, delegates occupied themselves with such pressing matters as lowering the voting age to 16 – something for which there is absolutely no demand – and ordering school boards of trustees to let same-sex couples attend school balls.

Then there was the remit requiring 50 per cent gender equality among officials on the party’s electorate committees.

When it was pointed out that most committees had three officials, the conference determined that an extra position such as an assistant treasurer could be created.

Staggering. Their solution is to create an extra unneeded role, just so there is prefect gender equality on a committee. They have effectively outlawed a committee having an add number of members!

This kind of nonsense shows that political correctness is alive and well in Labour.

It speaks of a party that is out of touch with mainstream New Zealand. And it speaks of a leader who has no control over his party.

Where was the strategy for the conference?

The other casualty of what John Key describes as the now very “public war” within Labour is the party’s ability to project unity and stability.

That is a serious handicap for Labour, which may well have to patch together some kind of governing arrangement which accommodates the reforming zeal of the Greens and the reactionary predilections of New Zealand First.

Think if they were to form a Government. They’d first have to get agreement between the internal factions in Labour, and then with the Greens, and then with NZ First and maybe then with Mana also. If another financial crisis struck, it would probably take a month to even make a decision!

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Fran on Christchurch

August 4th, 2012 at 12:01 pm by David Farrar

Fran O’Sullivan writes:

I’ve really drunk the Kool Aid when it comes to the inspirational blueprint for Christchurch’s new CBD. It is a stunner. Compact. Cutting edge. Green. Sustainable.

It was crunched out in just over 100 days; a brilliant demonstration of that old maxim “pressure makes a diamond”.

It is also a plan that all New Zealanders need to embrace.

I doubt many of us seriously appreciated that the whole of New Zealand is pretty much a seismic zone until the devastating Canterbury earthquakes hit.

Yeah I thought it was just Wellington that was going to get a big one.

But I’ll never forget the look of abject horror on the faces of the hundreds of people who poured out of the Christchurch CBD after the 6.3 magnitude quake that struck on February 22, 2011 … or the grim chat I had with Mayor Bob Parker at the Christchurch Art Gallery shortly afterwards when he told me “there has been serious death”. Nor will I forget the sincerity of former US Secretary of State Richard Armitage, also in Christchurch when the quake struck, who later that afternoon told me the United States had instantly offered assistance from its own military based in Hawaii.

Disasters do bring out the best in people, as we band together. The memory for me is the Australian police officers and others landing in Christchurch to cheery crowds.

Key has now ordered them to get the L-shaped frame of parks which will surround the new CBD in place by the end of 2013. Decisions will be made super fast. Most will bypass the Resource Management Act.

The tempo will be fast.

If anyone doubts just how fast officialdom can work when the whip is cracked just consider the AMI stadium. David McConnell’s Hawkins Construction got that up in 11 weeks.

Which has proved to be excellent.

The brute reality is that before the quakes struck Christchurch was effectively dying. The very compactness of this new city heart will ensure its vibrancy.

Something I have said also.

What if other New Zealand cities – particularly Auckland – were given the tools so they too could follow Christchurch’s example and wipe the barriers that stymie economic growth?

Hear hear. Matthew Hooton also writes in NBR:

The government has created a major political risk for itself given the sheer brilliance of its new Christchurch plan.

I try to strictly avoid writing here about anything I am working on in my day job but, like everything else that has happened in Christchurch these last 21 months, this is a once-in-a-lifetime exception.

The Christchurch plan is the result of two madcap ideas by sometimes uneasy bedfellows, Christchurch mayor Bob Parker and earthquake czar Gerry Brownlee.

  Mr Parker led his council’s “Share an Idea” campaign where the people of Christchurch got to say what they wanted in their new city.  

It wasn’t the typically stifling local government “consultation” exercise.  Lawyers, formal submissions and correct spelling and grammar were not welcome.  People just got to scribble down in their own words what they wanted.

Over 100,000 Cantabrians responded, more than a quarter of Christchurch’s population.  The campaign became the first community engagement programme outside Europe to win the international Co-Creation Association’s supreme award and it did so unanimously.

The lawyers and lobbyists who make it their business to get between the public and their elected officials were sidelined.

I wasn’t aware of the award.

The plan is radical and far more clean, green, politically-correct and urban-design-y than would be expected to be signed off by the sometimes gruff and usually conservative Mr Brownlee.  There are all sorts of parks and art and culture hubs and so forth.  Christchurch will be the most beautiful city in the world.

But the plan is far more commercially astute than might be expected from the urban designers and creative types who prepared it. 

It halves the size of the CBD, making land scarce to improve returns per square metre, creating competition among investors and developers for the best spaces.  There is going to be a gold rush.

What is interesting is that the Property Council has welcomed the plan. They represent the property owners who have the capital that is essential to making the plan a reality. They were negative on the original plan, but have been supportive of this final one, which is a good and important thing.

Decisions will be made on urban design resource consents within five working days, by a three-person committee representing the government, the city council and Ngai Tahu and they will not then need to be notified under the Resource Management Act.

Proposals will of course need to be pretty, clean and green and fit the plan but the tradeoff is that developers get a final answer in a week.

Mr Parker’s city council has then resolved to make final decisions on all other aspects of building consent applications within a fortnight. …

Do Aucklanders need to wait for Rangitoto to erupt before Len Brown will launch a community engagement programme about its spatial plan as good as Mr Parker’s “Share an Idea”?

Do Dunedites need to suffer some sort of biblical-type flood before their leaders will develop an innovative 100-day plan to deal with some of the same long-term economic challenges that were faced by Christchurch?

Do Wellingtonians need to suffer their major earthquake before they get access to 24-hour investment services, five-day resource consent decisions and two-week building consents?

Does the Waikato need to be devastated by mad cow disease before delays at the OIO and Immigration Service are sorted out?

For that matter, why on earth doesn’t the government roll out its bold, visionary Christchurch approach on a nationwide basis and just slash all the barriers to economic growth that still exist everywhere but Canterbury?

A roadmap to growth.

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O’Sullivan on Shearer

July 14th, 2012 at 1:01 pm by David Farrar

Fran O’Sullivan writes:

I found myself wondering this week whether Shearer – who notoriously hates wearing a suit and tie – really only gets supercharged when he is wearing a flak jacket. He fluffed his way through a punchy interview on NewstalkZB when host Sean Plunket tried to pin him down on Labour’s position on the Maori Council’s controversial water rights claim.

The Shearer argument went something like this: Yes, John Key is inflaming things by rarking up the Maori Council and saying his Government won’t be bound by any Waitangi Tribunal ruling on the push to stop the Mighty River Power share float until a deal is done in this area. But, no, Maori don’t have a valid water claim. Nobody owns water. We pay for water rights to use water, whether it be for irrigation or hydro-electricity or whatever.

In other words, Key is right but I don’t want to say so because my party expects me to go into opposition mode at every opportunity.

There are plenty of other examples.

Shearer’s opposition to foreign investment in New Zealand farmland was also rather contrived. When Labour’s private polling indicated widespread public unease over the Shanghai Pengxin acquisition of 16 dairy farms, he chose to lift the scab off this running sore rather than pour on salving balm. Though privately he is not that fazed. Same too with partial privatisation of state-owned power companies.

Shearer held up Norway as a shining exemplar of what’s possible when it comes to developing a small nation economy. Yet many Norwegian SOEs are partially listed; the country has also built its fortune on oil.

Shearer should not have backed himself into these ideological corners.

Norway seems to be the new Finland.

Shearer needs to get out of this poll-driven mode. He is fundamentally an intelligent man who is at heart an internationalist. There is no shame in agreeing with the Prime Minister on some basic fundamentals. Both men are trying to capture the centre, after all.

His caucus seem to be pushing him towards the left.

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O’Sullivan on Key

May 13th, 2012 at 9:55 am by David Farrar

Fran O’Sullivan writes in the Weekend Herald:

John Key has made a strategic decision to burn some political capital and front-foot major Government decisions as he tries to wrest control of the national agenda. It’s a strategy that is bearing fruit.

Finally, the PM is putting a stamp on his Government as he lifts its tempo and gets some serious purchase on major issues.

So far Key is making reasonable headway as he stands shoulder-to-shoulder with Cabinet ministers while they unveil pre-Budget announcements on hot issues, such as Paula Bennett’s on welfare reform. …

The Government is very determined to do more than just manage the finances, but also to take hard decisions which will boost economic growth and hence jobs.

It is easy to underplay the impact of the Prime Minister’s cheery influence in keeping New Zealand business sufficiently confident in his Government’s management of the NZ economy so the vast majority of firms stay focused on the medium-term prospects and don’t simply shut up shop and move to Australia.

Political journalists and Beltway denizens don’t see much of this side of Key as, outside of the general election campaign, few venture forth on a consistent basis to watch the PM intersecting with the business community.

I’ve lost count of the number of times I have heard from reasonably politically agnostic business people how impressive the PM is when talking on economic issues at business forums.

The PM’s decision to front-foot the mini-scandals – instead of relying on his press minders to trot out the spin – is also a change from default mode.

He didn’t need the SkyCity convention centre wrangle, or the ACC and John Banks mini-scandals. But Key has more than held his own on television programmes such as Campbell Live or on Radio NZ’s Morning Report against critical news presenters trying to expose chinks in his political spin.

I can’t recall a time when a PM was being interview one on one so often.

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The Shearer defence

May 5th, 2012 at 11:38 am by David Farrar

Fran O’Sullivan backs David Shearer:

But unlike Cunliffe and Robertson he is not hostage to Labour’s past policy positions. He wasn’t an active player in policy formation for the 2011 general election. This has proved to be a strength – not a weakness – as he quickly jettisoned one of Labour’s more wacky election policies, wiping GST on fruit and vegetables. He followed through yesterday by abandoning another ill-considered Labour policy to support Government borrowing offshore to top up the Super Fund.

Shearer’s moves display political courage. He is not afraid to upset grassroot Labour Party members. By adopting a classically rational approach he will increase Labour’s appeal to centrist voters from across the voting spectrum.

I agree, so long as he can carry his party with him. Trevor Mallard was attacking National’s suspensions of contributions to the NZ Super Fund just two days before Shearer announced he is adopting National’s policy.

Also John Roughan writes:

Shearer seemed a normal guy who is not a natural at the arts of politics. For that reason I’d like to see him succeed.

Not too soon, of course. John Key is doing good things and if he continues the way he is going he will deserve the three terms New Zealand voters usually give a government. But Labour’s turn will come and when it does I hope Shearer is still there.

I think that is being optimistics. If Shearer doesn’t win in 2014, I find it hard to imagine he will be there in 2017.

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Hate-mongering

January 30th, 2012 at 12:38 pm by David Farrar

One of the posters (not commenters) at The Standard posted this over the weekend:

As you can see he calls Fran O’Sullivan a traitor, enemy and sell-out who will be shunned and reviled. This is because Fran dared to support the Crafar farm sale. It shows how demented some of the opponents have become. Redlogix of course cowers behind his alias, and would never ever dare to write such stuff under his own name – unlike Fran.

But as you can see, not content with just having Fran labeled a traitor and enemy to be shunned and reviled, a commentor Millsy calls for her to executed, saying “the likes of O’Sullivan, Key, Williamson, and Coleman will find themselves … rewarded for their treachery with a one way trip to the gallows”.

Now Millsy is just a commenter, and this is not the first time he has advocated violence against those whose political views he opposes. I of all people would say you don’t judge a blog on the basis of a comment by a commenter. I mean, after all it is possible they didn’t even see the comment (I read a small proportion of total comments on KB). If they did, surely they would delete it and at least kick him off?

But no, as you can see Red Logix (who is an author, not a commenter) effectively endorses the comment, saying that while it was a marginal call, it is okay because he said “the likes of” and that Millsy is correct in general.

Fran actually had been contributing to the thread (and kudos to Fran for standing up to people who call you a traitor and enemy) and pointed out that Millsy is Brendon Mills (easily found through Google). Now get this – The Standard deleted Fran’s comment, but left up the one effectively calling for her to go to the gallows!

Fran sums it all up nicely, with this tweet from Fran:

The Standard? Internet version of the Ku Klux Klan. Happy to string up people behind web cloak of anonymity.

There is a reason so many of their authors (not all) wear virtual hoods to hide their identities.

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The national interest in making the ports more efficient

January 11th, 2012 at 11:49 am by David Farrar

Fran O’Sullivan writes in the NZ Herald:

It seems pretty obvious that the ports company has been determined to ensure productivity at its downtown Waitemata Harbour operations is markedly increased. Particularly in the vital area of crane productivity, where rival Port of Tauranga sub-contracts its container stevedoring work and boasts a superior performance to its Auckland competitor.

If the Maritime Union didn’t see this one coming, then they haven’t been paying much attention to the Ministry of Transport report on container productivity at New Zealand ports. Nor has the union been paying attention to the Productivity Commission which estimates exporters and importers spend upwards of $5 billion a year on freight and has forecasted annual trade could be boosted by $1.25 billion if transport costs were shaved by 10 per cent. There is a national interest issue at stake here.

$1.25b if costs are down 10%. The Ports of Auckland are definitely working in the national interest if they can make themselves more efficient.

I note the Port of Tauranga sub-contracts its stevedoring work out. Maybe that sub-contractor could apply to do the work for Ports of Auckland also?

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Fran on Asset Sales

May 28th, 2011 at 10:00 am by David Farrar

Fran O’Sullivan writes in the NZ Herald:

In his bones, Key will know that in the longer term the partial privatisation policy will prove very popular indeed, particularly if the sales are sweetened with a sprinkling of “popular capitalism”.

Australia’s Queensland Government – run by Labor’s Anna Bligh – did just this by offering incentives to mum and dad investors in a highly successful string of assets sales.

There were no brokers’ fees, a specified maximum price per share and a loyalty bonus to incentivise small shareholders to hold on to their shares, as well as a free parcel of shares for relevant workers; particularly with the float of Queensland Rail (now QR National) – the second largest IPO in Australia’s history.

 People did not like Telecom and NZ Rail being sold off entirely to large foreign corporates. But the floats of Auckland Airport and Contact Energy to local investors were actually relatively uncontroversial at the time.

But on this side of the Tasman, Labour leader Phil Goff – who was an integral member of the David Lange Cabinet that privatised many state assets – is hell bent on re-erecting Fortress NZ.

What I dislike about Goff is that he reneges on policies he previously promoted when he believes he can score a naked political advantage.

Hence at the 2005 election he blithely stood by while a fellow Cabinet minister made untrue allegations that the United States was writing New Zealand’s policy even though he knew full well that an American slagged off as a National “bagman” had partially under-written a New Zealand lobbying programme in the US capital.

The same bagman who has been our most generous donor to the arts. What shameful treatment.

So when Goff gets all pumped up and red-faced and hyperbolic, Key only has to dip into the recent history books to underscore the Labour leader’s hypocrisy.

In fact, the partial asset sales will provide an investment home for KiwiSaver providers, the NZ Superannuation Fund, iwi and retail investors. They will also release capital for the Government to reinvest in much needed new infrastructure and to help get the budget back into the black.

Labour is going into an election campaign which they say they want to fight on asset sales, yet their leader was once the most enthusiastic advocate for. Do they really think they will get much resonance?

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Investigative Journalism & Winston

November 10th, 2010 at 2:17 pm by David Farrar

NBR carry an NZPA story on Winston’s latest claim:

Overseas ownership of New Zealand news media outlets is in the political spotlight, with New Zealand First leader Winston Peters saying it has eroded journalism standards.

A traditional opponent of overseas ownership, Mr Peters told NZPA he was concerned about the profits of domestic media, banking and forestry companies going off shore.

“It has also led to serious erosion of media standards and journalism reporting because people are given no time to do any work properly, instant sound bites have become the name of the game, and that is sliding its way into tabloid journalism,” Mr Peters said.

International companies that owned New Zealand media outlets had failed to support investigative journalism and had “squeezed the professional capacity” out of the industry, he said.

“I’m the last one in the world that should be making a sympathetic argument for the journalists of this country, but I’m telling you that’s exactly what happened.”

Proper investigative journalism was essential for the democracy of a nation, Mr Peters said.

Now normally I ignore what Winston says, but the irony here is too great. I actually agree we need more investigative journalism, but we do have some sterling examples of good investigative journalism by Fairfax and APN journalists. Namely the superb work done by reports Phil Kitchin, David Fisher, Audrey Young and others in exposing the tissue of lies Winston told about the funding of NZ First and himself by various wealthy businesspeople. It was investigative journalism at its finest and exposed Peters as a charlatan whose reality was the direct opposite of what he railed again.

The comments thread on the NBR story has some superb contributions, such as Phil Kitchin:

I’d love to get answers to questions Winston has never answered Monaco Consul. But the two answers Winston gave me when I got to speak to him during my investigation into NZ First funding and all the lies about the Spencer Trust were…1) Phil, I’m not speaking to a lying wanker (then the phone went dead), and 2) Phil, I’ve told you I’m not speaking to a lying gripper. Do you know what that is, it is a lying wanker who won’t let go (then the phone went dead).

Yes Winston is an unusual champion of investigative journalism. It is like Al Capone criticising the IRS for not cracking down hard enough on tax fraud.

Bill Ralston chimes in:

Congratulations NBR! That is the funniest story I’ve read in years. Hopefully Winston’s return to the political scene will encourage investigative journalists and grippers to reopen their old files and start digging again and he may get his wish!

And Fran O’Sullivan:

Give us break – Audrey Young (NZ Herald owned by APN News & Media) blew the Owen Glenn fiasco open. Phil Kitchin completed the double in the (Dom-Post owned by Fairfax). Great investigative reporting by two first-class journalists working for Aust owned media but under good Kiwi editors.

Exactly. And remember Labour is working hard to get Winston back into Parliament, as they don’t stand a chance without him.

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Mood of the Boardroom

July 2nd, 2010 at 2:27 pm by David Farrar

Attended the annual Herald’s Mood of the Boardroom breakfast yesterday. A big crowd gather to hear the results of the survey by Fran O’Sullivan, plus speeches and Q&A with the Finance Minister and normally the Opposition Spokesperson. For some reason David Cunliffe couldn’t attend this year, which was a pity.

Around 350 CEOs took part in the survey. Now before anyone states the obvious, no of course they are not a representative sample of New Zealanders. But as a group they manage a greater share of the economy than the Government does, and their view on business conditions determines whether or not billions of dollars of investments and purchases occur. So I regard it as a very good group to get views from.

Some of the findings were:

  • 79% support there being a Regulatory Responsibility Act
  • 70% support mining on the conservation estate, so long as conservation values are retained or restored
  • 62% are focused on reducing energy costs
  • 60% support foreshore & seabed reform
  • 76% want ACC opened up to competition
  • 58% want the NZ company tax rate to be below Australia’s
  • 57% support partial listings of some SOEs on the NZX

I found it interesting that partial sales of SOES had the least support, even though still a majority.

The budget was rated 3.63/5 (think 73%) as a solid foundation for future growth, 3.8 (76%) as business friendly and 3.92 (78%) as making the taxt system fairer.

The eight top ranked Ministers were:

  • John Key 4.58
  • Steve Joyce 4.50
  • Chris Finlayson 4.47
  • Tony Ryall 4.09
  • Simon Power 4.08
  • Judith Collins 4.08
  • bill English 4.06
  • Jonathan Coleman 4.03

Individual Labour spokesperson were not ranked but 98% of CEOs said Labour’s leadership has yet to begin carving out a credible alternative to the Government.

The top ten domestic issues of concern (out of 10) were:

  1. Labour productivity 7.2
  2. Regulation 6.9
  3. Skills and labour shortages 6.9
  4. Level of govt spending 6.9
  5. Adequacy of infrastructure 6.8
  6. NZ dollar level 6.7
  7. Wage increases 6.4
  8. ETS 6.2
  9. Level of NZ Govt borrowing 6.1
  10. Access to capital 5.9

The top ten international issues affecting confidence are:

  1. Instability in capital markets 8.5
  2. Protracted global recession 8.4
  3. Level of borrowing by govts 8.0
  4. Strength of US recovery 7.7
  5. Exchange rate volatility 7.7
  6. US dollar value 7.2
  7. Competition for global talent 6.5
  8. Protectionism 6.3
  9. Commodity prices 6.2
  10. Global inflation 6.2

They also ranked the two leading candidate for Mayor on several attributes on a 1 to 5 scale

  • Leadership skills – Banks 3.47 v Brown 3.06
  • Puts interest of Auckland over political alignment – Banks 3.33 v Brown 2.74
  • Vision and strategy – Banks 3.33 v Brown 2.99
  • Management – Banks 3.27 v Brown 2.63
  • Experience – Banks 4.11 v brown 2.84
  • Judgement – Banks 3.26 v Brown 2.51
  • Trustworthiness – Banks 3.37 v Brown 2.86
  • Ability to form support within Council – Banks 2.98 v Brown 3.15
  • Economic management – Banks 3.65 v Brown 2.56
  • Courage – Banks 4.30 v Brown 3.46

But 50% of CEOs want a new candidate to also enter the race.

Also 85% of CEOs support compulsory superannuation, as in Australia.

And ratings of various aspects of the budget:

  • Closing loopholes for Working for Families 4.73
  • Increase in GST 4.44
  • Personal tax cuts 4.24
  • Corporate tax rate cut 4.21
  • Aligning top personal and trust rates 4.09
  • Change tax treatment for LACQ’s 4.06
  • Axe depreciation for residential housing 4.01
  • Cuts to savings vehicle tax rates 3.95
  • Reduction in thin cap threshold from 75% to 60% 3.63
  • Ace depreciation on commercial buildings 3.17
  • Axe 20% depreciation loading on new assets 3.16
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Fran on ETS

April 28th, 2010 at 7:21 am by David Farrar

Fran O’Sullivan writes:

John Key’s refusal to postpone the implementation of the next phase of the emissions trading scheme (ETS) is setting the scene for a ‘winter of discontent’ with New Zealand business.

In just two days the perception of the Key Government as a climate change laggard has morphed into an unwitting climate change leader as our major trading partners, like Australia and the United States, prepare to defer their own schemes leaving this country out in front of the pack instead of the “fast follower” the PM promised.

The decision by Kevin Rudd to delay his ETS until 2013 does place pressure on NZ. It is almost ironic that National is at risk of accidentally achieving Helen Clark’s aim of being a global leader rather than a fast follower in terms of responses to climate change.

Of course the Australian ETS has never been passed into law – it is easy to delay something not yet legislated for.

The NZ ETS was passed into law by Labour in 2008, and them amended by National in 2009. It is already in effect for sectors such as forestry.

The Auckland Regional Chamber of Commerce has been adding fuel to the fire by asking its membership to email Key directly to ask for the July 1 cost hikes to be deferred.

The chamber reckons it will increase electricity prices by 5 per cent and add 4c a litre to the cost of petrol and diesel. Its boss Michael Barnett reckons the cost hikes will jeopardise the profitability of small to medium businesses as they get back on a growth curve after the lengthy domestic recession.

I’ll have to read the ETS legislation to check, but am unsure whether or not the Government can defer the entry of those sectors, without amending or repealing the ETS law. If a law change is needed, it couldn’t realistically be done by 1 July.

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Fran on Uranium

February 16th, 2010 at 10:13 am by David Farrar

Fran O’Sullivan writes:

Australia now earns more than A$1 billion annually from exporting uranium ore concentrate. By 2014, that figure is expected to be A$1.7 billion.

There are tight controls: Australian uranium is produced only for export and is used only for peaceful purposes in civil nuclear power stations outside of Australia and is trumpeted as a contributor to global climate relief.’

The reason Australia doesn’t have a suite of nuclear power stations is it burns cheap coal for power.

But NZ is stuck in a 1980s cul de sac: Nuclear equals bad.

Secondly, is the PM now expected to order the administrator of his blind trust not to invest in any company that could be mining uranium simply because New Zealand has anti-nuclear laws?

If so, that rules out many companies with diverse interests. Bizarre really.

I thought it was bizarre. Nuclear power is indeed a way to reduce carbon emissions, so wy the fuss over the PM having shares in a company that helps reduce carbon emissions.

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Reaction to PMs Statement

February 10th, 2010 at 10:38 am by David Farrar

The EU had a reception at the Backbencher last night, so lots of MPs and journalists there to chat to.  The typical opening line from a National MP was “So about that B grade” while from Labour MPs it was “Unlike Annette we won’t use Farrar and respect in the same sentence unless there are some other words in between” :-)

Phil Goff was there also, so I said I looked forward to him quoting me more often in future :-). Actually had an interesting chat generally on economic stuff, such as land tax. If Labour are bold they could consider proposing a land tax (tied to income tax reductions) for 2011. That could attract some support from economic reformers.

General consensus I got from pundits there was that there was definitely some good stuff in the Government’s work plan – in fact more detailed plans that most Governments announce in the PMs statement.

But what may trip the Government up is they misplayed the expectations game. Building the statement up as the “most important” one ever was a mistake, as was talking about it being a “step change”. Again, there is some good stuff there that certainly will help lift economic growth. But will the announcements alone close the gap with Australia? Of course not. But the rhetoric leading up to it, got expectations artificially high.

With the benefit of hindsight, it would have been better to have positioned the statement as a typical PMs statement – a general overview of the Government’s achievements and workplan, and then surprise the media and opposition when it turns out to have close to 30 specific initiatives in it.

As I said yesterday, I welcome the focus on growing the economic cake, not just how to split it up, and look forward to more details in the budget.

Reaction from others:

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