Thursday, August 21, 2014

Why foreigners are buying up New Zealand

Because our lax tax system lets them cheat on their taxes:

Why would an overseas buyer pay more for an asset than a New Zealander? Is it because they can accept lower returns on capital? Perhaps. Is it because they can sweat the asset more? Again, perhaps. But Chalkie reckons one reason stands out - tax.

There are huge tax advantages available to overseas investors that simply cannot be accessed by locals. They crank up the returns available to foreign buyers and make New Zealand assets worth more to overseas owners than to New Zealand residents.

The article uses Wellington Electricity Distribution Network, which has paid virtually no tax due to being piled with high-interest, related-party debt to a company in a tax haven by its foreign owners, but the practice is apparently widespread. The result is both that we get bought out of our own country because NZ assets are more valuable to foreigners than they are to us, and meanwhile our government gets starved of revenue by tax-cheating sociopaths.

There is an easy solution to this: put the effect on taxation in the Overseas Investment Act. If foreign ownership would see less tax paid in NZ, then that's a reason to refuse a transaction. Simple.

Scotland: Get out now while you still can

Scotland goes to the polls in a month in a referendum on independence. The assumption throughout the campaign has been that if Scotland votes to stay in the UK, it will be rewarded with further devolved powers - an assumption made explicit this month by a cross-party pact amongst the English parties. But a new poll shows that these promises can't be relied on, and that English voters want to hammer the Scots:

The Future of England Survey found that people south of the border are overwhelmingly against Scotland leaving the UK, with 59 per cent saying they would like the Union to stay intact and only 19 per cent favouring separation.

But it also showed that English opinions over what should take place after the referendum differ widely from the scenarios on which politicians on both sides of the debate are pinning their hopes.


However, in a blow to the Better Together campaign, the survey also shows that English people would be in favour of the UK Government taking a much tougher stance on Scotland if it decides to say in the Union.

Most of those polled (56 per cent) agreed that public spending in Scotland should be reduced to the UK average following a No vote, while the vast majority (63 per cent) believe that Scottish MPs should be prevented from voting on English laws in the future.

Meanwhile, UKIP explicitly wants to roll back devolution, which will place pressure on the Conservatives and Labour to do likewise. The upshot: English politicians are making promises they can't keep, and there's a real chance that Scotland will be stripped of its parliament and made to share the misery of the rest of the UK if it stays. If Scots want to retain what they've got, they need to get out of this abusive, colonial relationship now, while they still can.

New Fisk

Middle East crisis: We know all too much about the cruelty of Isis – but all too little about who they are

Key lied

Interview with John Key, Morning Report, 18 August 2014:

ESPINER: Well let’s have a look at some of those specifics in the book. Cameron Slater gets an OIA request granted from the SIS which embarrasses Phil Goff. It’s approved in a few days, which is unheard of for information to be released that quickly, especially from the highly sensitive SIS.

KEY: Well

ESPINER: Did that did that request come across your desk?

KEY: No.

ESPINER: So you’re the minister responsible for the SIS, yet you did not sign off on that request?

KEY: No.

OIA response to Felix Marwick, 9 November 2011:
Following discussion with the Office of the Ombudsmen, in relation to your request of 4 August, I can confirm that there was no written "correspondence with the Government and the Office of the Prime Minister regarding the NZSIS decision to release information to Mr Cameron Slater". I notified the Prime Minister (in accordance with my usual practice to keep the Minister informed on a "no surprises" basis) that I was going to release redacted documents in response to the request from Mr Slater. I advised the Prime Minister that I had received legal advice that there were no grounds for withholding the information given the public disclosures already made about the existence and some of the content of the briefing. I informed the Prime Minister that I had informed Mr Goff of my decision to release the information.
[Emphasis added]

That's pretty conclusive. Key lied. He tried to mislead the people of New Zealand about his actions. Ministers have been sacked for that.

Update: Tucker is now saying that when he said "Prime Minister", he meant the Prime Minister's office. But further documents released by NewstalkZB show that he told the Ombudsman that he had had a "discussion with the Prime Minister". So, it looks like that desperate rearguard action doesn't stack up either. Key is lying to our faces. Are you going to tolerate that, or vote him out on his arse?

Wednesday, August 20, 2014

SIS OIA turnaround times

One of the central allegations in Nicky Hager's Dirty Politics is that Cameron Slater received favourable treatment in the handling of an OIA request to the SIS. That allegation is now the subject of an investigation by the Inspector-General of Intelligence and Security, but its worth noting that Slater certainly thought that was the case; his facebook messages to Aaron Bhatnagar released today say it was "expedited in the public interest".

So was it? Here's some data:

  • Slater's request (via Donotlink) was made on 26 July and responded to on 2 August - a turnaround time of 5 working days.
  • There are five successful requests to the SIS made via FYI. These were responded to in 8, 24, 12, 49, and 26 working days respectively, for an average of 23.8 working days.
I think that speaks for itself. Slater's turnaround time was the fastest ever observed by the SIS. And I think its pretty obvious why: someone in the Prime Minister's office told them to hurry it up. Whether this violates the SIS's statutory duty of political neutrality is left as an exercise to the reader.

The gift that keeps on giving

There's been another Whaledump this afternoon, this time of Facebook messages with Aaron Bhatnagar. As expected, it confirms everything alleged in Dirty Politics. Unfortunately, in addition to this public interest material, it also includes a vast amount of material of no public interest at all, or where there are significant privacy interests, so I won't be linking to the raw material.

And in related news, the Inspector-General of Intelligence and Security has opened an investigation into whether the SIS violated political neutrality in its handling of an OIA from Cameron Slater, and whether the material was properly declassified. It'll be interesting to see what comes of that.

How it works in Fiji

Fiji is having an election next month, but the regime is keen to limit the political competition any way they can. So they're banning people from running if they've ever had a parking ticket:

The leader of Fiji's United Freedom party Jagath Karunaratne says he has been rejected as a candidate for the elections because of a seven year old parking offence.

He was one of twelve nominees rejected as a candidate for the September polls by the Fijian Elections Office but he has appealed against the decision.

Mr Karunaratne says the decision was surprising because he paid the fine and the offence did not involve a jail term of more than a year.

Meanwhile, illegally overthrowing the government and tearing up the constitution are apparently no barrier to standing. Clearly Mr Karunaratne's problem is that his crimes just weren't big enough...

Fiscal rectitude and false books

It also seems to be fiscal rectitude day, with both major opposition parties promising to "live within our means" and run bigger surpluses than National. But while they're both promising balanced books, that doesn't mean conforming to National's austerity madness; instead, both parties are offering to increase government revenue through capital gains taxes and higher taxes on the rich. Which, given that 97% of kiwis aren't rich and never will be, should be popular.

Running balanced books is a Good Thing. So is borrowing for investment, and to cover necessary costs during disasters or times of economic trouble. Labour has a good record on this - while National likes to paint it as nine years of profligate spending, the fact is that Michael Cullen consistently delivered surpluses, which were reinvested in building better social services for ordinary kiwis. I think we can trust them and the Greens to do the same if elected.

Assuming of course that they aren't dealt a BNZ-scale surprise by National fiddling the books. Campbell Live reported last night that EQC had failed to file financial projections for next year (in violation of the Crown Entities Act), and that this could have a significant effect on the government's balance-sheet. No-one from the government would front up to explain this, which suggests they're hiding something (namely, a billion dollar budget hole). Meanwhile, the government published its Pre-Election Fiscal Update, showing they'd meet their surplus target. But given the government's refusal to front on the EQC news, I'm not sure that we can trust it.

The government needs to front up on this. It also needs to enforce the law on EQC. Failure to file those statements is a fundamental failure by the EQC board to do their job, as well as contravention of statute. They need to be sacked and prosecuted. Knowingly preparing a false or misleading PREFU is a criminal offence punishable by 12 months imprisonment. If Treasury has any suggestion that EQC's financial position is worse than that stated, then they should be looking at the inside of a jail cell.

Writ day

It's official: we're having an election:

The Governor General, Lt Gen The Rt Hon Sir Jerry Mateparae, has given the green light for this year’s General Election.

The Governor General has signed the writ directing the Electoral Commission to conduct the General Election on 20 September 2014. This is the formal authority to run the 2014 election, and enables candidate nominations to open tomorrowThursday 21 August 2014.

“The issue of the writ is a key constitutional step in the election process. The writ sets out the dates for candidate nominations to close, election day and the date the writ must be returned showing the successful electorate candidates,” says Robert Peden, Chief Electoral Officer.

The fact that we do it this way is a sad relic of our monarchical past, when Parliament served the monarch rather than the other way round. And while we've put some of it on a statutory basis, it would be better to eliminate such vestiges.

Meanwhile, it looks like most of the small parties hoping to contest the election made it in time, givin gus a healthy 18 parties competing for votes. The exception is the Expatriate Party, which claimed to have enough members to register, but hasn't done so. Maybe they'll get their act together next time...

Tuesday, August 19, 2014

Politics does not have to be dirty

Writing in The Press this morning, Chris Trotter argues that politics is essentially dirty: "Bluntly, "dirty politics" is the only kind there is".

I reject this proposition absolutely.

I'm not doing so out of naiveity; I agree with Trotter on the essentially Hobbesean pact which underlies democracy, that its a gentler way of solving issues that used to be solved by civil war and murder. And I've read my Machiavelli and agree that being an effective ruler may sometimes demand immoral methods. But that doesn't mean that all is fair and that we should accept what we have seen. To point out the obvious, if being an effective ruler demands immoral methods, one can always choose not to be effective - or not to be a ruler. In the C16th when Machiavelli wrote, that choice was effectively suicide, or at the least impoverishment and exile. In the modern era, the consequences are rather less severe.

Our politicians make choices. How far they are willing to go to get what they want and to stay in power is one of those choices. The ruling clique in the National Party has clearly chosen to delve into the sewer and behave like sociopaths to keep themselves on top. Other parties - and indeed, others in National - would clearly make a different choice. The choice as to which ones get to run the place, and therefore how much of this toxic crap we have in our political system, that's up to us.

I can't stress that last point enough. We get to hold politicians accountable for their choices. And in 31 days, we'll have a chance to do just that. So, if you reject National's dirty politics, vote the fuckers out. And hopefully, whoever replaces them will get the message that this sort of shit just isn't acceptable.

A commitment we can hold him to

Still reading Dirty Politics. Meanwhile, in addition to all the damage to the government from the truth coming out, we've also got something else useful from it: a firm commitment to higher standards from David Cunliffe:

Labour Party leader David Cunliffe says if he was Prime Minister he would hold his ministers to a higher standard than John Key does.


David Cunliffe told Radio New Zealand's Morning Report programme Ms Collins' behaviour was unbecoming of a minister, especially a Justice Minister who is meant to uphold and guide the formation of the law.

He said if Ms Collins was a minister in a government run by him, she would be gone.

"There would be a huge difference in the standards that I would hold my ministers accountable to and the way that the Prime Minister is treating the Minister of Justice."

The full audio is here. And if he becomes Prime Minister and shows any reluctance to enforce high standards on Ministers, we can beat him with it.

Labour on the Treaty

Labour announced its Māori development and Treaty of Waitangi policy over the weekend. There's a lot in it - no thanks to Labour's habit of shoehorning their key economic policies into everything just in case people have missed them - but there are a few key points:

  • Statutory recognition of Māori as the indigenous people of Aotearoa. Symbolic, but hugely significant all the same.
  • Completing all historical Treaty settlements by 2020. Its good for the government to prioritise this, but as with the claims deadline, I'm afraid it may lead to injustice and iwi being pressured to agree to settlements to meet an arbitrary target. There's potentially some protection against this with the proposal of an independent body to recommend settlements where the government has taken too long - or it could just be a tool to force iwi into one-sided (and therefore not unsustainable) "settlements". Labour will need to do a lot of hard work to get this right, and show a lot more good faith than they have in the past.
  • Post-2020, a review of the role of the Waitangi Tribunal. This follows naturally from the settlement deadline, but its dangerous ground. The Tribunal isn't just a backward-looking body focused on investigating past wrongs, but one which rules on the government's ongoing Treaty obligations as well. There needs to be more reassurance that that role will not be weakened.

So, potentially some good policies there, but a big problem of trust for the party of the Foreshore and Seabed Act to overcome.

Meanwhile, I'm wondering whether Labour's 2008 claims deadline led to the effects I'd feared or not. Have iwi been denied justice for their failure to jump through arbitrary procedural hoops? Or did it work as a spur to action? I'm genuinely interested in knowing.

Monday, August 18, 2014

Tackling child poverty

The Greens have announced their tax policy: an increased top tax rate of 40% on earnings over $140,000, with the billion dollars of extra revenue targeted towards reducing child poverty. That looks like a good deal to me. Child poverty is a moral stain on our society which blights lives and denies people a decent chance in life. It also costs us a fortune. Money spent to reduce it is not a cost, but an investment, which pays off through reduced future costs for welfare, health and crime. And it speaks volumes that our current government is too short-sighted to see that.

Crowdsourcing the dirt machine

So, the biggest political scandal of the year happened while I was busy, and I still haven't had time to read the book yet (I'm hoping to get to it this afternoon). From what I've read, I agree with Danyl and Andrew: this is a toxic style of politics which we shouldn't stand for, and those who practice, use, or even condone it need to be voted out on their arses.

Meanwhile, amidst his unconvincing denials this morning, John Key admitted that his staff were "briefing the bloggers" as part of the government's media management strategy. Those staff are paid with public money, and that media management is official government business - which makes those briefings "official information". Which means we can demand its release under the OIA.

Of course, any request for all briefings to bloggers will be refused as requiring substantial collation and research, but there's a way round that: crowdsourcing. As I've just tweeted: pick a month, email "" (or use the FYI form here) requesting all briefings to bloggers by him and his staff made during that month, demand urgency due to the high public interest in political accountability and the upcoming election. If they don't indicate that they'll respond to it in the two days they do for their pet dirt-dealers, complain immediately to the Ombudsman on "". The Ombudsman has previously indicated in the student-loan costings decision that requests for significant information around election-time have heightened public interest, and that should help.

I'm doing July 2014. Someone else is doing June. There's an FYI request in for May-August, and I'm sure there'll be others. Join the crowdsource, and help expose how National's dirt machine works.

Update: There's now requests in for January, February, March and April 2014.

Thursday, August 14, 2014

Places to go, people to be

While I'd like to blog today (my copy of Dirty Politics just having arrived), its just not going to happen. And tomorrow I'm off to Auckland for Chimera, New Zealand's biggest larp convention.

Normal bloggage will resume Tuesday.

Wednesday, August 13, 2014

Wages and productivity

When confronted with evidence about our low-wage economy, business claims that wage increases have to be justified by increases in productivity. But as the graph below shows, productivity has increased massively, but employers have welched on their end of the deal:


(Graph stolen from @publicpurpose)

How have they been able to get away with this? Because the Employment Contracts Act tilted the balance towards bosses and enabled them to artificially suppress wages. And even Labour's reforms under the Employment Relations Act didn't do much to change the trend.

This is nothing more than social pillage. We need to end it.

More TPPA problems

While everyone is waiting for the news on Nicky Hager's book, we learn of more problems with the Trans-Pacific Partnership. The government is holding this out as a free trade holy grail, promising access to America while denying it will sign away our public health system or internet rights to rapacious American corporations. But it turns out that no matter what the agreement actually says, the US can refuse to bring it into force for us until we change our laws to conform with their interpretation of it - allowing them to extract further concessions over the heads of the New Zealand people:

‘Behind the seemingly benign term “certification” hides an extraordinary power that the US is expected to assert if the Trans-Pacific Partnership Agreement (TPPA) is concluded’.

‘Effectively, the US claims the right to decide what a country’s obligations are under a trade and investment agreement and refuses to bring the agreement into force in relation to that country until it has changed its laws, regulations and administrative processes to fit the US interpretation’, Professor Kelsey explained.

Statements from members of US Congress and the US Trade Representative (USTR) suggest prime targets for New Zealand would be our copyright and patent laws, the foreign investment vetting regime, the procedures by which Pharmac operates, and Fonterra’s ‘anti-competitive monopoly’.

‘The other eleven governments are aware of the certification process and many are concerned. But no one has told the public how the US can effectively redraft our laws.’

There's more details on the process here, and it looks appalling. And in Peru's case, the US used certification of a bilateral free trade agreement to redraft Peruvian laws to suit American interests.

Its bad enough when treaties are made in secret without any public input, but this is a step beyond that into pure economic colonialism. If the US wants to use the TPPA to do this we should tell them to go fuck themselves. Free trade is not worth our sovereignty, or our democracy.

This will be interesting

Nicky Hager is releasing his latest book tonight:

The Government is bracing itself for revelations about the extent of New Zealand's role in the Five Eyes spy network as author Nicky Hager prepares to unveil his latest book.

Hager is keeping silent on the subject of the book but Prime Minister John Key yesterday said he could not rule out the likelihood that Hager had obtained leaked documents from former American defence contractor Edward Snowden.

The book is being released in Wellington today and Hager was not distributing advance copies. He also refused to discuss the subject.

I can think of a number of subjects it could be about, but surveillance is the obvious one. And if so, its likely to be highly damaging to the government and the deep state. Which invites the obvious question: will National try and have it banned as an "election advertisement"? Remember, according to the courts books aren't journalism...

Meanwhile, if you're attending the book launch tonight (17:00 at Unity in Wellington), you can probably play a fun game of "spot the spook". But please remember that thanks to Robert Muldoon, its a criminal offence to call a spy a spy, so be careful with your photos.

Tuesday, August 12, 2014

Something to be proud of

New Zealand is ranked first in the world for social and environmental progress:

New Zealand has come first in a global index that ranks countries by social and environmental performance rather than economic output in a drive to make social progress a priority for politicians and businesses.

The Social Progress Index (SPI), published on Thursday, rates 132 countries on more than 50 indicators, including health, sanitation, shelter, personal safety, access to information, sustainability, tolerance and inclusion and access to education.

It asks questions such as whether a country can satisfy its people's basic needs and whether it has the infrastructure and capacity to allow its citizens to improve the quality of their lives and reach their full potential.

Our full results are here.

This highlights the narrowness of the National government's vision. All they care about is economic growth (for the rich), and they're willing to sacrifice anything - including social equality, our environment, and our human rights - to get it. But its those things which make us a decent country to live in, not coal mines, oil rigs, and dairy farms.

Is political satire really illegal?

Planet Key from Propeller Motion on Vimeo.

So apparently you're not allowed to play this on the radio. And reading the Broadcasting Act, its easy to see why: it "appears to encourage or persuade voters not to vote for a political party or the election of any person at an election", which makes it an election programme, which means it cannot be broadcast unless as part of a party's broadcasting allocation.

...which is a perverse result. What the Electoral Commission is telling us is that insofar as it can be viewed as persuasive, broadcast political satire is illegal. And I'm not sure that that really fits with their BORA obligation to interpret the law so as to be consistent with the right to freedom of expression. OTOH, it might explain why political comedy has disappeared from our television screens: because the politicians have outlawed it.

(And in case you're wondering: while apparently an "election programme" under the Broadcasting Act, that video isn't an election advertisement under the Electoral Act, for the simple reason that it is very obviously not an ad. So I don't think there's any problem posting it on the web, or performing it live outside Parliament).

Update: Update link to a non-FaceSuck source.