I blogged yesterday on how horse trainers had been granted an exemption to stay open. Since then (might be coincidence) the decision has been reversed.

Lincoln Farms reports:

Trainers’ hopes that they can keep exercising horses during the Covid-19 lockdown have been dashed with the Ministry of Primary Industries ruling this afternoon that all horses must be spelled unless paddocks cannot be found for them.

Last night New Zealand Thoroughbred Racing and Harness Racing New Zealand issued trainers and track operators with an exhaustive list of rules to follow to allow horses to be worked, protocols approved by the MPI.

That led to tracks like Cambridge Raceway and Franklin Park preparing systems for how and when horses would be worked. Trainers, anxious for owners to not have to wait months before racing their charges again, were also going through the myriad of paperwork involved.

But today even more restrictive requirements were inserted into the list and already this has led to the closure of the Cambridge galloping and harness tracks.

It would be a very interesting OIA to MPI asking what consultations with Minister (or their staff) took place in deciding the original rules, and then the new rules.

Trump’s approval rating is normally a net -13% or so but at the moment it is only -5%. This shows that in moments of crisis, people tend to rally behind the Government (regardless of how well they actually are handling it).

So how does Trump’s rating stack up with other Presidents around eight months out from the election? In order their net approvals are:

1. Eisenhower +55%
2. Nixon +18%
3. Reagan +15%
4. Clinton +11%
5. Johnson +9%
6. Bush GW +3%
7. Obama +2%
8. Carter +2%
9. Trump -5%
10. Bush GHW -9%
11. Truman -9%

Those in bold were re-elected.

Newshub reports:

Piles of meat could be heading to the tip after butchers were told last minute they wouldn’t be able to open on Thursday – New Zealand’s first day of COVID-19 lockdown.

The list of essential businesses was confirmed late on Wednesday leaving many caught out and still confused. 

Mike Hanson of Netherby Meats had stocked up for the lockdown but instead of it being sold to customers, it will now have to be given away or thrown out.

“In the back chiller – we’ve probably got four or five beasts for the shop and 30 hoggets to put somewhere, and the freezer is not big enough to store all of this,” he told Newshub.

On Wednesday morning, Hanson was given the green light to open as an “essential business” from both his local MP and Retail Meat New Zealand. Hours later, the Government ruled otherwise.

If dairies can open, why not butchers? They both only sell stuff you can get in supermarkets?

Right next door to his butcher, a dairy is open for business as usual. 

“They’re selling smokes and coke and fizzy drinks – and what are they doing open?”

Prime Minister Jacinda Ardern said on Thursday if the Government allowed every food outlet to open, “we wouldn’t achieve what we need to achieve”.

Butchers do, however, have the support of the National Party who think this rule does require a rethink.

“If there is a greengrocer beside a dairy, or a butcher beside a dairy, they can’t open,” National MP Todd McClay said. “That doesn’t really make a lot of sense.”

There’s a huge difference between every food outlet and butchers selling meat that people need to cook. They have a far bigger range than many supermarkets also, especially for people intolerant of gluten.

There was a 100 metre queue to get into my local supermarket. You’re at mroe risk having to spend 90 minutes at the supermarket than five minutes at a butcher’s shop.

Most infected countries:

1. China 81,285 cases
2. Italy 74,386
3. USA 68,489
4. Spain 49,515
5. Germany 37,323
6. Iran 27,017

Most deaths

1. Italy 7,503
2. Spain 3.647
3. China 3,287
4. Iran 2,077
5. France 1,331
6. USA 1,032

Most cases per million capita (over 1,000 cases)

1. Luxembourg 2,129
2. Switzerland 1,269
3. Italy 1,230
4. Spain 1,059
5. Austria 666
6. Norway 572

Most deaths per million capita (over 100 deaths)

1. Italy 124
2. Spain 78
3. Iran 25
4. Netherlands 21
5. France 20
6. Switzerland 18

New Zealand so far has only 59 infections per million capita and no deaths. Let’s hope the suppression strategy keeps us far from the top.

The Government is ramming legislation through Parliament before the election to allow prisoners serving sentences of less than three years to vote.

Now many people might assume that someone in prison for a sentence of less than three years is a first or second time offender.

Far from it.

I asked the Department of Corrections what was the average number of convictions held by a prisoners serving a sentence of less than three years.

The answer is 50.

Yes 50. These are not first or second time offenders. They are hardened recidivist criminals who have created scores of victims.

So the Government wants to give the vote to these 1,985 prisoners who have an average 50 (NB this is now 30 – Corrections made a mistake in their calculations) convictions each.

Also of interest is that 40% of them, or 797, have gang affiliations (includes prospects and associates). Do you think they are going to suddenly stop committing crimes?

These are the bills passed by Parliament yesterday under urgency, before they adjourned.

1. Imprest Supply (Third for 2019/20) Bill. This authorises further expenditure to 30 June 2020 of $52 billion to cover emergency spending. The largest blank cheque in our history Parliament has given the Government. $40 billion is for operational expenses, $10 billion for capital expenditure and $2 billion for capital injections
2. COVID-19 Response (Taxation and Social Assistance Urgent Measures) Bill. Implements some minor tax changes announced last week, allows IRD to remit interest on tax owing after 14 February and to share information with other agencies for COVID-19 response purposes.
3. COVID-19 Response (Urgent Management Measures) Legislation Bill. Allows Secretary of Education to take over any school in relation to COVID-19 measures, allows local authorities to meet remotely, prevents tenants being evicted for six months in most cases and freezes rents for six months

All parties in Parliament supported these as emergency measures.

They also established an Epidemic Response Committee to scrutinise the Government’s response and use of powers in this time. The membership is:

1. Simon Bridges (Nat) – Chair
2. National MP
3. National MP
4. National MP
5. National MP
6. Labour MP
7. Labour MP
8. Labour MP
9. Fletcher Tabuteau (NZF)
10. Marama Davidson (Greens)
11. David Seymour (ACT)

The Herald reports:

Brenton Harrison Tarrant has today made a shock admission that he was the lone gunman who murdered 51 Muslims at two Christchurch mosques on March 15 last year.

The 29-year-old Australian entered the guilty pleas at a special, hastily-arranged High Court hearing in Christchurch this morning.

Tarrant, who appeared from prison on a screen via audio-visual link (AVL) wearing a grey prison sweatshirt, pleaded guilty to all 51 murder charges.

He also admitted 40 charges of attempted murder relating to the two attacks at Masjid Al Noor and Linwood Islamic Centre on March 15 last year – and pleaded guilty to one charge of engaging in a terrorist act laid under the Terrorism Suppression Act 2002.

This is excellent news. No idea why he changed his mind as I thought he wanted his moment in the sun. But this means the victims and their families are spared a long horrible trial, and we also are spared it. Plus Tarrant no longer gets to espouse his ideology in a trial.

So now we can move onto sentencing. There is only one possible sentence in my view – Life without parole. It can be imposed when:

the court that sentences an offender convicted of murder to imprisonment for life is satisfied that no minimum term of imprisonment would be sufficient to satisfy 1 or more of the purposes stated in subsection (2), the court may order that the offender serve the sentence without parole.

And the purposes are:

(a) holding the offender accountable for the harm done to the victim and the community by the offending:

(b) denouncing the conduct in which the offender was involved:

(c) deterring the offender or other persons from committing the same or a similar offence:

(d) protecting the community from the offender.

I think both (a) and (b) must lead to life without parole. If gunning down 51 people doesn’t qualify, then no murder could ever qualify.

I just hope that there wasn’t an agreement with Crown Law that they won’t ask for life without parole in exchange for a guilty plea.

Anyway again this is a great outcome for the victims, and for all of us.

Lincoln Farms reports:

Racing has been thrown a lifeline by the Government during the Covid-19 pandemic.

The Ministry Of Primary Industries has announced that training centres, stables, agistment properties and stud farms where horses are in containment are considered essential services under animal welfare considerations. …

The news was welcomed by Lincoln Farms’ trainer Ray Green.

“Common sense has prevailed. We’ll be able to look after the horses better rather than just slinging them out in the paddock.

I suspect certain Ministers were involved in this decision.

If it was purely about animal welfare, well horses do very well in paddocks – that is where the vast majority of horses live.

But what this decisions means is:

“And this will save a heap of jobs and potentially keep the whole game alive. We can continue to train the horses and have them ready to go when racing resumes.

“Otherwise it could have been another three or four months even when we got back to level three and that would have been disastrous for the industry.”

So it seems it is prioritising the interests of the racing industry over minimising COVID-19 transmission.

Now it’s not a bad thing that the racing industry doesn’t lose so many jobs, but the question is were they given special treatment due to Ministerial involvement?

The Herald reports:

Albert Uderzo, one of the two creators of the beloved comic book character Asterix, who captured the spirit of the Gauls of yore and grew a reputation worldwide, died on Tuesday. He was 92.

The French press quoted family members as saying that Uderzo died of a heart attack in the Paris suburb of Neuilly.

As a child I had every Asterix book and read them scores of times. I still have them all and look forward to introducing Asterix to Ben and Sam.

My favourite character was Obelix and then Dogmatix.

Hard to pick just one favourite book from the 38, but here’s my top few:

• Asterix and Cleopatra
• Asterix at the Olympic Games
• Asterix in Britain

Thank you to Albert Uderzo for bringing so much joy to so many people.

I’m posting this here as more people will see it than on the Curia website.

Curia closed its physical office and call centre today.

However we have managed to utilise technology so that some of our staff can make calls from home, and securely record responses. This means Curia will be able to continue to provide quantitative research services over the next month.

Obviously there will be no qualitative research or focus groups.

I’m pleased that we’re able to have our staff continue to earn money during this period, and provide services to our clients.

So if you do get called by someone from Curia, rest assured they are calling from their home where they are in self-isolation.

And if you do have any research needs during the next month, feel free to contact me. Our prices are here and we can insert questions into our weekly omnibus poll or do standalone research.

The Government has been good at slogans in this crisis, but the substance is often lacking.

They claimed we were going early and hard when in fact the initial response was belated and soft – the so called voluntary isolation.

The travel restrictions when imposed were after many other countries had done them.

But the real failure has been our lack of checks at the border.

Most New Zealanders probably think our borders are closed.

I have been told by a well placed source the reality is that around 6,000 people have arrived in New Zealand since they were “closed” and by end of the week it will be 20,000

Those arriving are not given health checks in airports, such as in many countries where they use thermal scanners. They are not tested for COVID-19. They are not quarantined. They are basically just given a pamphlet.

We know most of the infections are coming from overseas. We should be testing every arrival.

UPDATE: Since I wrote this, the Government has finally announced there will be screening at the border, and some testing. Better late than never should be the motto for the Government’s response!

The PM said on Monday:

Well, testing, obviously, is already at rates that are comparable to, for instance, Korea that is being held up at gold-standard level.

This is wildy far from the truth. On Monday the data was:

So we have tested one in every 578 people and South Korea one in every 152. Our rate is not comparable to Korea unless you consider one quarter the rate is “comparable”.

Stuff reports:

The Government has announced a mortgage holiday for those affected by coronavirus.

At a press conference on Tuesday Finance Minister Grant Robertson said the major retail banks had agreed to a six-month mortgage holiday for people who had their income affected due to Covid-19. 

The exact criteria was yet to be finalised, but it would cover both principal and interest payments.

A lot of people don’t realise that a mortgage holiday is a mere delay in payments, not a waiving of payments. If you take advantage of the mortgage holiday, you will end up owing more to your bank and paying them more over time.

I’ll give an example. Let’s say you live in Auckland and have just brought a house at the median price of $875,000.

You have the 20% deposit so take out a mortgage for 80% or $700,000. Assume a 25 year term and you get monthly repayments of $3,891 and total interest paid of $467.248.

Now let’s say you take the six month holiday. Your $700,000 owing grows at 0.375% a month so at the end of that six month holiday you owe $715,898.

You continue paying $3,891 a month but it now takes 27 years to pay off your mortgage, not 25 and the total interest paid is 501,450.

So you end up paying $34,202 more in interest.

So people should only take up the mortgage holiday if they absolutely need it. It is a holiday on payments, not a holiday on interest accruing (based on info known to date).

Also worth noting the reality is that almost all banks would give mortgage holders a payments holiday if needed, rather than foreclose. It is much more profitable for a bank to have you keep paying interest than selling your home and just getting back their original loan.

If your mortgage was so large that a payments holiday means the mortgage might be greater than the value of the section, then banks might be reluctant.

So in reality the Government guarantee won’t actually change bank decisions significantly, and people should only take up the holiday if they really need to (ie have lost their income and have no savings they can use).

This shows what exponential growth looks like. Hopefully it will slow soon, as the lockdown takes effect.

In one week we’ve gone from 11 cases to 155. The daily growth for the last week has been:

• 73%
• 47%
• 39%
• 33%
• 27%
• 55%
• 52%

If you take even the lowest daily growth of 27%, and apply forward you would be:

• 31 Mar: 826
• 7 Apr: 4,401

If the daily growth is 50%, then:

• 31 Mar: 2,648
• 7 Apr: 67,874

But if the measures work and the rate slows to 10% then:

• 31 Mar: 302
• 7 Apr: 647

So let’s hope they work.

Newsroom reports:

From 11.59pm on Wednesday night, the Government will assume hitherto unseen control over the lives of New Zealanders.

With Parliament joining other workplaces in entering lockdown, the obvious question was who would hold our elected ministers and officials to account.

In the wake of the unprecedented decision, Leader of the House Chris Hipkins promised an accountability mechanism of sorts to keep a check on the executive. Now, some more meat has been put on those bones of that promise.

Speaking to media on Tuesday, Speaker Trevor Mallard confirmed Parliament’s business committee – made up of representatives from all political parties – had agreed to establish a special select committee to run for at least the next month in the absence of Parliament.

The 11-person committee will be chaired by National leader Simon Bridges or a nominee of his choosing, and will have five National MPs in total –  meaning the Opposition, with the addition of ACT leader David Seymour, will hold a majority (a relatively rare state of affairs).

Mallard said the committee would have “unusual powers” akin to those of the Privileges Committee – the powerful body tasked with investigating alleged breaches of privilege or contempt of the House, and has subpoena-like powers to summon people and receive documents.

It’s good the Opposition has a majority on the committee and chairs it. That means it should be able to effectively scrutinise the decisions made.

David Seymour argues Parliament should not close though:

“We accept that the Government has a difficult task ahead. All New Zealanders stand ready to support it. But this is no reason to partially suspend democracy.

“The Prime Minister will soon issue an epidemic notice and invoke the Epidemic Preparedness Act. This legislation gives the Government the ability to change almost any law at the stroke of a pen. The Health Act will allow medical officers to enter any premises, detain people, prescribe treatment, and take possession of land and buildings.

“It may be necessary for the Government to have these extraordinary powers. If so, it is critical that Parliament is able to continue to hold the Government to account.

“Indeed, the Epidemic Preparedness Act explicitly says that Parliament should scrutinise any law changes made under that Act.

“New Zealanders have just faced the greatest peacetime loss of civil liberties in our history, and it is possible we may not have an election this year. ACT believes there should be a Question Time and local electorate offices should remain open. Half of New Zealanders did not vote for this Government. It is wrong to suppress their representation.

“The Government should deem democracy an essential service. If we need couriers, banks, and breakfast radio shows, then we also need democracy. We will have a situation where The Warehouse and the Waitakere Licensing Trust are able to remain open, but democratic accountability has been partially suppressed.

Fair points. I know quite a few MPs are not happy their electorate offices have to shut. Their job is to help people in need, and there will be a lot of people needing assistance during this time.

In response to the speed in which the economic and political environment is changing due to COVID-19, we have brought forward the launch of our podcast.  The first interview was last Thursday and Friday with Damian Grant and Dr Michael Ridell who take opposing views on the extent to which the Government should intervene to keep people in their jobs during the crisis. The third episode (recorded yesterday) we talked to Dr Matt Boyd, a specialist in health economics and global catastrophic risk, and Dr Don Brash, former RBNZ Governor.

You can subscribe to Taxpayer Talk via Spotify here (press “follow” after clicking the link) or Apple Podcasts here.

We welcome your feedback / constructive criticism as we master the art of casting the pod from self-isolation!

You can subscribe to Taxpayer Talk via Spotify here (press “follow” after clicking the link). Apple Podcast approval is still in process.

We welcome your feedback / constructive criticism as we master the art of casting the pod from self-isolation!

I’m supportive of the Government’s decision to lockdown the country. But I also believe decisions should be made on robust information, and ultimately all the decisions around the pandemic are weighing up benefits and costs of both action and inaction.

Martin Lally of Capital Financial Consultants has done a short paper looking at the potential costs, which I am publishing to allow informed debate.

The Costs and Benefits of a Covid Lockdown by David Farrar on Scribd

I’d note that one issue is that even if a Government doesn’t go for a suppression strategy, there will still be a drop in economic activity due to the actions of other countries, and many people deciding not to travel, shop, eat out etc.

But of course it would be less than the economic cost of suppression.

After this is all over, we should have a Commission of Inquiry to look to whether our responses were the best ones, were there better alternatives, and what might we do differently in future. The aim is not to cast blame, but to learn.

Some people may not like an analysis that puts a value on human life but this is commonly done for road safety and ACC etc. Also worth remembering that there is a very real toll on families who do end up with members losing their jobs, their incomes, maybe even their houses etc. So it is important to always focus on benefits and costs of all options.

The PM and her helpers have been saying that it is unhelpful for the Opposition to criticise the Government because we are in a crisis.

Considering that the Government’s response (up until Monday) has been criticised by hundreds of doctors, numerous public health professionals, the entire NZ Teaching Council and the former Chief Scientific Adviser to the PM, it seems ludicrous to suggest the only person in NZ not allowed to be critical is the Leader of the Opposition.

Claire Trevett makes the point:

Whenever somebody argues that there should be “unity” and no criticism from the media or the Opposition, it brings to mind the days after the Pike River Mine disaster.

Then there was a similar approach to the mine management during the press conferences: that it was not the time for criticism or hard questions, but for support. Peter Whittall was the good guy.

The ones asking hard questions in those press conferences were the Australian journalists. It transpired those journalists were right all along.

A good reminder.

And John Armstrong writes:

A politician of Mr Bridges’ experience does not need to be told that in such times as now, the public gives short shrift to those who are constantly carping from the sidelines.

He has accordingly carefully targeted his criticism into matters of concern, most notably the number of tests being conducted by health authorities when faced with possible cases of coronavirus.

In Parliament last Wednesday, Mr Bridges bombarded the Prime Minister with questions about the amount of testing that had been done. Ms Ardern’s response was to ignore those questions. She instead accused Mr Bridges of being “borderline irresponsible”. 

Her parting shot was to tell him that “this doesn’t have to be political”. Coming from someone who had presided over the release of an economic rescue package the day before which included a $25 increase in welfare benefits, that was a bit rich.  

Sure, the consequent $2.8 billion cash injection over four years is in line with the Government’s fiscal pump-priming. 

The unexpected handout bore all the hallmarks of an election-year Budget sweetener, however, with the additional purpose of salving the consciences of Labour and Green Party MPs.

For his part, Mr Bridges cited the increase in benefit rates as indicative of the “confused priorities” and the money should have been diverted to expand the payment of wage subsidies.

That is a valid argument — and one which is hardly “irresponsible”. 

Paul Goldsmith has an op ed which is excellent:

The Government announced a $12.1 billion economic package on Tuesday “to support New Zealanders and their jobs from the global impact of Covid-19”. This equates to around 4 per cent of New Zealand’s GDP (Gross Domestic Product).

The reality is, however, that only around half of that package can possibly be spent in the next two or three months. When we need it. That is around two per cent of GDP.

Yes with this Government ignore the slogan and look at the substance. It was a $6 billion package and far from being one of the largest in the world is one of the smallest.

The primary source of urgent assistance is the $5.1b wage subsidy scheme. This we support. But the $150,000 cap for businesses, which translates to 21 full time staff, means that around half or more of New Zealand’s workforce won’t be covered the scheme.

While it’s true that most businesses in New Zealand are small, the majority of workers currently work for the 5000 businesses that employ more than 50 people.

Just think of a large scale tourist bus operator with hundreds of employees. This business’s revenues will have collapsed. A subsidy capped at 21 employees will be of little assistance.

Our strong view is that the government’s immediate package of economic support – $6b at best – is far too light.

It is. Luckily the Government has now done what National suggested and removed the cap of $150,000.

We cannot possibly stop every job loss, nor avoid every business collapse. But we can, and we should, do more to save as many jobs as we can.

Remember this is an economic shock created by government responses to a virus. This is why successive governments have reduced debt when they could. This is what we’ve prepared for.

Of course Labour claimed National reducing debt was austerity and they constantly called for much more spending which would have never seen us back in surplus and paying debt off.

Bomber Bradbury writes:

we need an economic response that matches the danger we face and targets certain groups within society. …

• Tax amnesty for small and medium business: They are the ones who will suffer the most, allow a tax amnesty with the usual penalties cancelled.
• Welfare: Everyone will be scrambling for some type of welfare, it will need to be increased, and the draconian punitive crap dumped.
• Immigration Freeze: We will need to freeze immigration at a time of economic crisis because everyone will be fleeing.
• Rent Freeze: Don’t allow greedy Landlords to benefit from a crisis.
• Minimum Wage Freeze: We can’t seriously be asking small business to pay people more as the economy collapses.

So when the the guy whose politics are to the left of Lenin thinks putting up the minimum wage next week is a bad idea, why is the Government persisting?

The true test of leadership is not doing things you sort of wanted to do anyway (put up benefits) but doing stuff you really don’t want to do, but accepting the circumstances have changed.

National really wanted to do tax cuts in 2009 but cancelled them because of the GFC.

Why is Labour unwilling to delay the increase in the minimum wage?

At a minimum if they proceed, they should cover the costs themselves, rather than impose extra costs on small businesses that are struggling to survive.

The Government has announced will move to Level 4, effectively a total shutdown, in 48 hours. It will remain in place for at least four weeks.

They have also removed the cap on the wage subsidy (both things being stuff National had called for).

These are good moves.