Marx, Pakeha, Debt, History, Property and... crash?
Lucyna, at Sir Humphry's observed:
NZ Pakeha Govt: incompetent and racist
COMMENT: Pakeha government, in negotiating with Waitangi Treaty claimants, has constantly pleaded poverty. Yet, as shown below, it has no problem enriching its Pakeha capitalist class and funding a huge overseas debt for the benefit of its (mainly) Pakeha constituency.
Marxist speak. So far no link with the Maori Party that I can find. There's heaps more just like this on the website I've linked to.
It's like the cold war never ended with some people. Their assumptions about race and our history and therefore our current problems deserve scrutiny. To that end, Lucyna:
They mentioned "class." Obviously raving Marxists! The problem is that they are correct.
Our system operates along economic class lines despite there not being any deep antipathy and some fluidity between economic classes. If the government operates a policy to benefit home owners above owners of other capital, or vice versa then this can be seen in class terms. Whether Cullen is even aware of this (despite his doctorate) given every Finance Minister's reliance on policy from Treasury is moot. Or maybe he acknowledges that he now operates the state for the sake of the state rather than for any class - which means he operates it for whatever the status quo was before him. Given the Cullen fund I think he is doing exactly that. Great for the government, rude for everyone else not already creaming it from or through or by the state. Like a... socialist... corporatist... Technocrat.
But if you're not shy of analysis:
Our current account deficit is what? $10 billion in the red. Been in the red since the UK told us to bugger off and stop leaching. Our government debt has been higher than the asset backing since one of the many speculator-capitalists (Vogel in this example, but any one of those of his class) nationalised responsible local governance, viz: the Provinces, so the Crown could directly fund massive debts through huge borrowing to benefit his class primarily. Have those precious railways ever been in the black??? They weren't then, they aren't now, they are not projected to be in the future... Whose the sucker?
Maori land "acquisition" was the original basis for the entire speculative pyramid premised on permanent immigration. The Treaty is evidence of that. We've just had the last vestigages of Maori property claims stripped away by the Crown (oh Maori will get 20% of the aquaculture area so they only lost a miserly, insignificant 80% total and reduced in status to supplicants) so the crown can sell it off, so the cycle is coming to an end. Problem is the end of any speculative binge or pyramid scheme is always a crash. To prevent the crash the Crown must find new revenue streams like 115,000 international students last year, 30,000+ immigrants each year minimum, user pays for everything including "free" schools, tolling, increasing taxes or selling it's remaining assets.
Why does the Reserve bank admit that our currency is the 11th most traded in the world (sorry no link, tried to find it). Why do we have the highest interest rates in the developed world?
Is this alarming you or do you think it's sweet as?
Almost our entire banking system is foreign owned and we are going about attracting foreign capital because we don't have any. Cullen is "investing" 92% of the Super fund (supposed to be over $100b at peak) off-shore - why? Why did he pump more money into the RB's reserves? I don't want to bring on a crash any sooner than necessary but speculators know that Cullen/Crown must preserve it's Triple A Sovereirgn debt rating or the charade is over. If they take the money out what will we pay them with? If they liquidate their holdings suddenly we will have to go to the RB's reserves and then the Cullen fund. Is the govt. prepared to prop up the dollar by even higher interest rates? Sale of more assets? If we owned the banks it would not nearly be so bad - Switzerland may be a case study of prudential wisdom through a high exchange rate/volume rather than us.
The govt. claims the Crown will move into a net asset situation next year for the first time since the speculators needed railways to make their dodgy land "acquisitions" turn a quick profit. Really? What they mean is the Cullen fund will prop our exchange rate up so the valuations look good so they can claim we have no net debt. If someone on Wall street twigs that Bollard's signature isn't even on the 20s yet, after 3 years, and the RB is thus holding massive stocks of currency because they rationally predict inflation, then we are in big trouble. If Cullen liquidated the fund and repatriated it would it really amount to what they say it does? If we have to prove it, how short will we fall? Buying in now when we are strong seems prudent though - I can't work out whether this strategy is genious or madness. Such are the machinations of economists. I don't trust the bastards: lock into the Euro now.
But to answer the question: does the pakeha capitalist class benefit from high overseas debts? The simple answer is: there sure isn't any capital gains tax so obviously they benefit directly in that sense.
Who is this class: White people (and immigrants) who own productive, ie. revenue generating and asset increasing property. So, shares, businesses, investment property and I would say their own domestic house also if they buy it with an expectation of significant increase and sale therefter. (You see now how this links in with my earlier comments about "locals") So, almost all Pakeha are part of this class by that definition. Remember to some Pakeha (one of you guys on this blog I think) something isn't even "property" as such unless it can be sold to someone else. So Maori don't constitute Pakeha, and obviously because their predominant form of capital is not for sale, ie. land, and some of that does not even produce revenue. Very broad brush here but I see what they are saying and asset/productivity differences between Maori and Pakeha would probably bear that out.
What constitutes a benefit? Increase in capital value and/or increase in revenue.
Does the means or process of "funding high overseas debts" create that benefit?: Well the Crown borrows money to pay for things in NZ. What is the Pakeha/Maori split on that payment? It also lets foreigners/Pakeha in to own things formerly owned by the Crown when it comes to pay the debts off. It increases tax revenue and rates, but any good accountant - purley the agents of this class - will be able to minimise it whilst everyone else cops the full amount (fair enough!)
I have to give this last part of the question more thought as it is pivotal. But, I think the introduction of immigrants as a short-term fix that operates on a long-term basis is the real problem. Because it feeds the speculation that lets the "Pakeha capitalist class" become wealthier (through large increases in property prices) whilst Maori who are outside that capital system to begin with are locked out as prices rise beyond their ability to produce revenue to enter the speculation - and with more people in the country the situation becomes more extreme. Pakeha who occupy some of the most productive and therefore expensive land such as Waikato, Taranaki and Bay of Plenty are on land stolen off Maori by the Crown and any remedy to that situation (no matter where you stand on the issue) is ever more acute as the value of the loss and the ability to rectify things on an "at market valuation" principle becomes ever more difficult.