Free Press: ACT’s regular bulletin

Nice Knowing You
Free Press predicts Trump will be U.S. President. We have been on the spot in the final days of elections and we know how it feels to bomb out. Clinton is bombing out while Trump’s momentum is, as he would probably say, momentous. We also predict that the fallout of Trump’s election will be like Brexit, terrifying the day before and unnoticed the day after.

Good Foresight
With New Zealand’s anaemic constitutional arrangements there would be little to restrain a madman like Trump (hence the paradox that we bother to find better candidates from a pool of fewer than five million people). The U.S. constitution is strong, however, and as Free Press predicted earlier in the year, after four years it will be Founding Fathers: 1, Trump: 0.

In Case You Missed It
Solid Energy’s various assets were liberated back to the private sector, but not before costing the hapless New Zealand taxpayer a bundle. The estimated loss in value was $3 billion, essentially written down to nothing when the company failed. By comparison, total dividends from State Owned Enterprises last year were just $0.75 billion. This is why ACT opposes politicians getting into business.

Double Trouble
Not only do politicians lose taxpayers’ money when they go into business, there are good reasons why they’re more likely to. Number one, it’s not their money and nobody spends other people’s money as carefully as their own. Number two, they have completely different objectives from normal shareholders, for example they might want an airline to fly to their constituency. Air New Zealand attempts to head off such pressure with an all-you-can-drink piss up function at the Beehive each year.

In Case You Missed It Two
Also attracting practically no media coverage last week was the transfer of 47% of Kiwibank to The NZ Superannuation Fund and ACC’s investment fund. While they are government entities, these funds have only one objective, which is to maximise shareholder return. It would not be a bad idea to transfer more SOE’s to fund ownership, but a far better idea would be full privatisation.

The Problem with Corporate Welfare
The Saudi Sheep deal was not corrupt, because wheeling and dealing is accepted statecraft in New Zealand. In the 1880s parliament passed legislation so that politicians’ friends’ dodgy railways could be bought up by the taxpayer, and it hasn’t really stopped since. You could argue that New Zealand is not less corrupt than other countries, we’re just too classy to do it with brown envelopes.

All Guilty (except us, of course)
As David Seymour pointed out in this ripper of a speech all parties are engaged in buying votes with taxpayer money. The Nats have Sky City, endless corporate welfare, and the Major Events Fund. The Greens have their proposed Green Investment Bank. New Zealand First has horse racing and unviable regional rail projects. Labour announced funding for a $2 billion train track into the Mt Roskill electorate mid-by-election with no business case.

Just the Cost of Doing Business?
Free Press considered whether the odd backhander is just what one has to do when making deals in places such as Saudi Arabia. The Government sought a trade deal and nearly got one. Do we need to lighten up a bit?

No. No. No.
Successful Kiwi business such as Mainfreight and Stephen Jennings’ Renaissance Capital work in corrupt countries on a strict no-backhander principle. Not only is it the right thing to do but they find it more profitable in the long run. The Government has fallen well short of the country’s best international businesspeople. The question is not whether they’re corrupt but whether they’re doing their best.

Career Politicians
Gareth Morgan’s latest vanity project in the form of a political party will be entertaining, but he does raise one interesting point about so-called ‘career politicians.’ Free Press has watched neophyte MPs and Ministers, no matter how successful in their previous lives, get thoroughly gazumped by bureaucrats with 30-40 years’ experience in their area (this is another reason the Trump Presidency will be a fizzer). Up against 2,500 government policy analysts working in Wellington, it counts to have politically experienced MPs.

ACT’s Election Year Conference
ACT will be kicking off the 2017 political year with its February 25 Conference in Auckland. As usual the speaker line up is first class, with Mike Williams of the Howard League on reducing crime by rehabilitating prisoners, Leonie Freeman from The Homepage on how to fix a Housing Market, Frances Valentine of The Mind Lab on education for a digital age, and Eric Crampton of the New Zealand Initiative getting to the bottom of the inequality debate. Please register here.

Human Rights Violation
Labour announced it would tax those who employ immigrants instead of training locals. A Free Press reader points out that taxing a business because it chooses to employ someone from another country is almost certainly a violation of Section 22 of the Human Rights Act, which forbids discrimination on any basis other than ability to do the job. Who on earth does Labour get to do its due diligence?

From Pillar to Post
Dean Lonergan of Duco events thought he could sucker punch the New Zealand Government for funding to host his boxing match for Joseph Parker. After the Government ducked away he hit up the Auckland Council, who denied him also. Lonergan is now childishly attacking Councillor Dick Quax, and effectively claims that Auckland could be Las Vegas if we had a boxing-based tourism strategy… Suffice to say ACT have been at the forefront of opposing this latest round of corporate welfare.

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