Red Alert

Archive for July, 2010

I’m angry

Posted by on July 31st, 2010

I’m angry. And reading Chris Hipkin’s post below has just made it worse. Not at Chris of course, but at the cost of economic insecurity to humanity which Walter Nash talked about.

I spent this afternoon doorknocking in South Dunedin, one of the poorest and most densely populated parts of our country. People are insecure and afraid. They either have jobs that don’t pay much and they haven’t had a pay rise for a long time, or they are unemployed and can’t find jobs. They can’t make ends meet. They don’t turn their heaters on.

One family said “we can’t afford to eat meat. We used to be able to”. A lot of families said we don’t know what to do when the GST goes up. Tax cuts mean nothing.

Everything is more expensive. And they feel they are being made to pay. One woman, a sole parent with three teenagers told me she wants to work but can’t find work. “There is no work”. And she said she was being made to feel guilty for being on a benefit when there was no work anyway.

She is afraid for her kids getting jobs and being exploited through the 90 day law that means an employer can sack someone (often young people) in the first 90 days of a job. She joined the Labour Party today. Had never even thought about it til I turned up on her doorstep.

As Chris writes below (thanks Chris) Walter Nash said: “Men and women are not free to develop their own souls, to express their own individual personalities, to contribute according to their individual capacities to the world’s cultural inheritance – they are not free to do any of these things so long as the fact and fear of economic insecurity confronts them. Only when this fear is removed do they become in the fullest sense of the term a free people.

This country is becoming more and more economically insecure. What’s this government doing? Nothing but making their lives harder and making them more afraid. I’m angry.

Update: I’m so angry, I missed out the bits about the number of elderly people I personally encountered today (and they are constantly contacting my office) who are confronting losing their hour and a half per week of home help. Doing a bit of housework, preparing some meals, helping with some of the chores aorund the house they can no longer do. God help us that these elderly citizens who have contributed to our country, have paid taxes, went through the Great Depression, brought us all up and now they get treated like this at the end of their lives.  Do the math! Helping people stay in their homes and lead a live with value is actually more cost effective than taking away their independence and requiring them to be put into a home. Not taking into account the human rights and human dignity aspect. I think you can tell I’m angry.

From the archive: Walter Nash

Posted by on July 31st, 2010

I’m a fan of New Zealand history, particularly our political history. I read a lot of political biography and on occasion, when I’m a bit tired and bored in the House I pick up copies of the old Hansard and read what some of our esteemed former leaders talked about (from all sides). A while ago I came across these quotes from the late, great Rt Hon Walter Nash. They sum up pretty well for me what it means to be Labour.

“We have obligations towards the old and infirm because their work in their earlier and more fruitful years has made it possible for us to enjoy the standards we enjoy today – because they have done their share in making our present life possible. We have obligations towards the young because if we fail to provide for them, we fail to provide for the future, because it will be the duty and the privilege of those who are young today to make a still better world for tomorrow.We have obligations towards the sick and the ailing because they cannot care for themselves. And when those obligations have been fully discharged, when those unable to provide for themselves have been provided for, it is our duty to ensure that those who do the useful work of the world enjoy the full reward of their toil”.

“Men and women are not free to develop their own souls, to express their own individual personalities, to contribute according to their individual capacities to the world’s cultural inheritance – they are not free to do any of these things so long as the fact and fear of economic insecurity confronts them. Only when this fear is removed do they become in the fullest sense of the term a free people. We cannot reasonably expect the flowering of the higher attributes of humanity in a society that is diseased at its roots. Squalor, destitution, unemployment, slums, malnutrition, ill health, insecurity – these are diseases of the body politic which must be stamped out fearlessly and without equivocation before we can hope to build on foundations that are spiritually as well as materially secure”.

Key’s lie puts free trade deal down US agenda

Posted by on July 31st, 2010

I don’t agree with her emphasis but Fran O’Sullivan has highlighted a less obvious outcome of John Key’s employment relations reform.

Helen Kelly last year initiated contact between Tim Groser, the Nact Trade Minister, and Richard Trumka, President of the AFL-CIO, in an attempt (and in itself a risk on Kelly’s part) to get the US union support necessary for a free trade deal through congress and to push it up the Obama agenda.

Trumka, who is not a natural supporter of free trade, agreed to visit NZ and talk with unionists as well as politicians.

Kelly’s intervention was based on a fairly co-operative arrangement with the Key government, involving a large degree of trust. It resulted from some undertakings – especially relating to consultation.

Key broke his word, co-operation finished and Trumka was told that the positive working relationship no longer existed and he pulled the pin on the visit.

Nice one John.  Just to be seen to give wage and salary earners a bit of a kicking at your party conference.

We’ll all pay the cost of ECE cuts

Posted by on July 30th, 2010

Last night I hosted a public meeting in Upper Hutt on early childhood education. It was very well attended by parents, teachers and concerned members of the public. This is a bit of a sleeper issue that’s going to come back to bite the National government. Around the country early childhood centres are grapling with an impossible choice – do they cut quality or increase fees to parents, thus compromising access? The crunch is still a few months away. A lot of parents aren’t even aware it’s coming yet.

Kindergartens are being clobbered really hard. They’ve already decided they want to stick with having 100% qualified staff, and they don’t charge fees, so they’re going to find it really hard. Where will they find the money? Cuts to teacher professional development, property maintenance, and equipment budgets will be high on the list no doubt. Who loses out? The kids.

If we’re serious about catching up with Australia, if we’re serious about reducing the prison population, if we’re serious about providing security in retirement, we need to take a long-term view. That starts with giving kids the best possible start in life. Kids who attend quality early childhood education do better at school, better at work, better in life. These cuts are just so short-sighted and we’ll all pay in the long run.

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Posted by on July 30th, 2010

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Friday Poll: On the wage gap with Australia

Posted by on July 30th, 2010

Before the last election John Key said the ‘fundamental purpose’ of his government would be to narrow the wage gap between New Zealand and Australia. How’s he doing?

(Note: you can answer more than one)

Do you believe the Government:

View Results

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NZ abstains on UN water resolution

Posted by on July 29th, 2010

Is access to clean water a basic human right? 124 nations at the UN General Assembly thought so today and supported a resolution affirming this (and sanitation too.)

NZ was among 41 abstentions, with MFAT arguing it hadn’t had time to assess, wasn’t consensus on the issue.

Labour as government would almost certainly supported the resolution. Former Prime Minister Peter Fraser was an architect of the Universal Declaration of Human Rights in 1948. With a world population of perhaps a billion then, the crucial importance of access to water wasn’t seen as ncessary. With 6 billion on the planet and growing, about a billion people already live without safe water. Little wonder as many people die each year of water-borne illness, most of them children,  as the population of greater Auckland.

Ironic abstention when one in six New Zealanders doesn’t have tested safe water, when the Government has frozen assistance to small communities to make water safe for a year, and Rodney Hide’s bill to privatise council water supplies for 35 years is before us.

Filed under: Auckland, water

Tyre Kicker in Chief

Posted by on July 29th, 2010

Interesting to read Duncan Garner’s take on John Key’s answering on the wage gap between Australia and New Zealand

Yesterday’s performance in Parliament was too selective and too slippery for him to get away with. All the statistics show the gap between Australian wages and Kiwi wages is growing – but Key refused to accept it. He refused to admit it. In fact he went the other way – he said the gap is closing. It’s not, no matter which figures you focus on.

It was an interesting insight into the sensitivity of the government on this issue that Key would try to argue that black was white, when the numbers, even under his chosen construction pointed to the gap widening. It was a bit more than slippery too- it was a very deliberate attempt to mislead.

All of this began as a result of questioning on the absence of an economic plan from National to achieve their stated objective of catching up with Australia. This is a vitally important issue for the country. Concern about this is not only coming from our side of the political spectrum but also from those more closely aligned with the Nats.

Trans-Tasman, the political newsletter today devotes a significant amount of space to concern about the lack of courage in the Government’s programme noting that the obesession with a safety first approach is raising questions about the willingness to take the hard calls and saying poll driven leadership is raising questions about policy intentions.

Many months ago on this blog I described Mr Key as being ” all map and no compass”.  As they say in the House, I stand by that statement.

Sad caucus

Posted by on July 29th, 2010

Don’t normally post things about caucus here but this is going to lead the news so I figure it is ok.

Made it clear in the past that Chris Carter and I were never that close. We argued. West coast snails probably the worst.

But I’ve got to know him pretty well over the last couple of years. We go to pump classes together. The Labour Party and Parliament have been Chris’ life for the last 17 years.

Chris has been under a lot of pressure around the expense issue. He hasn’t found it easy to take that pressure. I haven’t supported him well.

Today he did something incredibly stupid (made stuff up and circulated it to media in a failed attempt to be anonymous) which I think has ended his political career. He has been suspended from our caucus. Quite a few of us who can sometimes be pretty hard had tears in our eyes as we did it.

But as with sport when there is an extremely bad breech of team discipline you are dropped from the team. Our teams decision was unanimous.

John Key clambers onto the bandwagon

Posted by on July 29th, 2010

Um I don’t remember John Key making these comments when Telstra Clear decided to send 48 jobs  from Kapiti to a Philippine Call Centre! And now another 70 jobs from the Auckland call centre are under threat.

Or when there was talk about Telecom outsourcing and offshoring several thousand jobs (NB Telecom has  since advised me those plans are “on hold” for now). Steven Joyce is on record as sayign the government has no responsibility for decisions made by a private company on outsourcing.

What’s changed? John Key is reading the political wind. Well I’m glad he’s sticking up for Kiwi jobs. Maybe he could announce support for the Kiwi Jobs Bill which aims to put in place a procurement policy to maximise opportunities for local businesses when tendering for large government projects.

Read what he had to say:

Prime Minister John Key says companies choosing to send their call centres to other parts of the world “are making the wrong choice”.

He wants other New Zealand companies to take note of Canon’s new call centre on the Shore.

Mr Key told the North Shore Times it is a positive move to open call centres in New Zealand because it creates employment for people of different age groups and ethnicities.

Brownlee bagged

Posted by on July 29th, 2010

You need no further confirmation of the latest hole Brownlee has dug for himself than this blog from DPF…all credit due of course to David Parker

The wage gap

July 29th, 2010 at 11:00 am by David Farrar

Claire Trevett reports:

A war of statistical tables in Parliament left National red-faced after even its own figures showed the gap in earnings between New Zealanders and Australians had increased since it took office in November 2008.

Economic Development Minister Gerry Brownlee had said in Parliament on Tuesday that the gap was less than it was when Labour was in power  but yesterday the statistics proved him wrong no matter how they were presented.

Prime Minister John Key produced a table which he said most accurately compared average earnings because it took into account purchasing power parity.

But his own figures showed the gap had increased by $22 in the two years since National took over in 2008. Instead, he said it showed the gap was less than it was at the “maximum point” of Labour’s reign  when the gap peaked at $187.60 in 2005.

But it subsequently shrank to $137.89 by Labour’s final year in 2008 and had since increased again to $160.25 under National.

Of course the wage gap has increased. We went into recession, and Australia did not. In a recession you have little wage growth.

I am surprised that a Minister would claim the gap has not increased. Rather than try to push dodgy comparisons, they would be better to outline policies which will help reduce the gap.

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u know Gerry B has stuffed up big time when you see posts like this on DPF’s blog..

Is the US middle class disappearing #2

Posted by on July 28th, 2010

A couple of days ago I wrote a post on the disapperance of the American middle class and the stark and growing gap between rich and poor in that country.  I was a bit wary because it was one article.

Today I’ve found this column, written by respected New York Times columnist Bob Herbet about the dangerous levels of economic insecurity within the US.

The study tracks the percentage of Americans suffering household income losses of 25 percent or more, and shows that families are suffering steeper income declines than in previous decades.

The evidence is there:

The pain coursing through American families is all too real and no one seems to know what to do about it. A rigorous new analysis for the Rockefeller Foundation shows that Americans are more economically insecure now than they have been in a quarter of a century, and the trend lines suggest that things will only get worse.

Rampant joblessness and skyrocketing medical costs are among the biggest factors tearing at the very fabric of American economic life so painstakingly put together in the early post-World War II decades.

What’s more frightening is that:

Policy makers seem bewildered by the terrible economic state of ordinary working Americans, including those once considered solidly in the middle class. Despite warnings back in 2008 that we were on the verge of another great depression, the big financial institutions and corporate America seem to be doing just fine now. But average Americans are hurting with no end to the pain in sight.

More than 14 million people are out of work and many more are either underemployed or so discouraged they’ve just stopped looking. Big corporations, sitting on fat profits even as the economy continues to struggle, have made it clear that they are not interested in putting a lot more people back to work any time soon.

Policy makers have dropped the ball completely in terms of dealing with this devastating long-term trend of ever-increasing economic insecurity for American families. Long-term solutions that have to do with extensive job creation and a strengthening of the safety net are required. But that doesn’t seem to be on anyone’s agenda.

Tongan Soldiers off to Afghanistan…

Posted by on July 28th, 2010

The link below explains the situation and at this stage I’m not going to start ranting on about what I think – but I am geninuely worried when I see things like this.

In summary – Tongan soldiers will be supporting the British in Afghanistan.  55 will begin service in November and 220 more will follow.  They will be getting paid 30 pounds a day for putting their lives at risk…

The Naked Economist; Part 3

Posted by on July 28th, 2010

Part 1 of this post noted the end of the “Washington Consensus” in economics. Part 2 noted that newly naked economists need some new clothes. In this part I want to stimulate discussion about priorities for the NZ debate going forward.

In the 2010 Budget debate I reckon Labour won the argument that average Kiwis will be worse off after 5.9% inflation next year devours their “tax switch”.

The next stage of the debate will focus on which policies deliver on rebalancing our economy and leaving NZ families better off.

Let’s cut to the chase on “rebalancing”.

The NZ economy is “unbalanced” because:

  •  we borrowed too much from overseas lenders, building a huge national debt
  • we spent it on bidding up property prices, not making things we can sell
  • we export too little and keep bleeding on our current account
  • we are slipping behind in innovation, technology and productivity

The heart of the rebalancing process therefore requires:

  1. lifting savings
  2. growing exports
  3. innovating more
  4. reducing (mainly private) international debt

Policies that would logically achieve that include:

  • boosting (not cutting) Kiwisaver and other savings vehicles
  • pre-funding (not suspending) the NZ Super Fund
  • monetary reform to improve exports (not over reliance on the OCR)
  • modernising and strengthening (not cutting) economic development
  • comprehensive innovation policies (including R & D tax credits)
  • fiscal responsibility and credibility (not more borrowing for tax cuts)

We need a government that has a credible and coherent economic strategy. Confidence is eroded by stop-start, poll-driven initiatives.

Our future is weakened by an underlying agenda that will worsen inequality, driving wedges between Kiwis, their communities and their environment.

Time for a reality check.  This is not only a government that has no coherent plan to credibly achieve the rebalancing NZ needs. 

Its short-termism and flip flops mask  an underlying  agenda – whether made explicit or kept implicit – that is individualistic and materialistic. 

It does not reflect the Kiwi way, nor embody our highest aspirations.

Their policies are flawed.  Their vision is narrow.  Their time is limited.

The Wage Gap

Posted by on July 28th, 2010

Before the last election the wage gap with Australia was John Key’s #1 issue. Key even went as far as to say that the ‘fundamental purpose’ of his government would be to narrow the gap. Listening to Gerry Brownlee and John Key in the House today and yesterday, apparently the problem has been solved already.

Yesterday Brownlee claimed that the gap ‘is certainly a lot less than it was when Labour was in office’ despite the fact that it has blown out by more than $50 a week since National took office. In the last quarter, according to official statistics, Australian wages have increased by $17 a week, compared to $3 for Kiwi workers.

Kiwi workers will fall even further behind from October when they will be paying a consumption tax (GST) that is 50 percent higher than in Australia. We have caught up with Australia in one respect though, when National took over we had a lower unemployment rate – they’ve managed to turn that around in 18 months!

So where is John Key’s plan? Smiling and waving for the cameras won’t get us there. As Annette King said in the House yesterday, “It’s time for the Government to stop kicking the tyres, put some petrol in the tank. start the engine and go somewhere!”. Couldn’t have said it better…!

A breach of trust

Posted by on July 28th, 2010

I have known Helen Kelly, the President of the CTU for quite a long time now. I admire her greatly. She has been, and is, an exceptional and passionate advocate for workers in New Zealand, and indeed internationally. I can appreciate the position she was in when National was elected and called on the union movement to be part of their Jobs Summit. I was a bit surprised when the CTU had John Key speak at their conference, but they felt this was a PM and the government that they should, and could, work with.

Just how let down Helen, and the workers she represents, are now feeling is clear from the letter that Helen has sent to the PM.

It is easy to feel the sense of betrayal in her words

She said he had breached his undertaking to consult her if the Government was going to move on union access and non-union collective bargaining.

“You also said you wanted to work with the unions,” she wrote. “And you portrayed yourself as a moderating influence in employment law matters. That has changed.”

I saw Helen at a function last night and I can report in person she is every bit as aggreived.

While the on-going debate will be and should be about the substance of the changes to workers rights and conditions, the role and the approach of the PM should not forgotten here. He led the union movement to believe he was their friend, but as soon as his perception of the political environment dictated a change, he moved swiftly to go against his word. That is a serious breach of trust, and one that I think the PM will live to regret.

Got no ideas Gerry? Well here’s one.

Posted by on July 28th, 2010

Last week’s release of the Government’s Energy and Energy Efficiency and Conservation Strategy contained a lot about fossils, and very little else. Reading their document, you get the sense that they have no new ideas on how to reduce New Zealand’s greenhouse gas emissions, or to move to a lower-pollution economy.

I think Gerry needs a bit of help, so here is an idea.

Labor in Australia is mooting a cleaner car rebate, offering a $2000 boost to new car buyers trading in pre-1995 cars.  The scheme is aimed to get 200,000 older vehicles off the road, cut transport sector emissions by nearly 3 million tonnes, and allow for tough new mandatory vehicle emissions regulations to enter into force in 2015.  Their rebate would take effect from 1 January 2011.

It is the kind of measure envisaged by the New Zealand Transport Strategy in the last Labour-led Government back in 2008.  One of the goals of the Transport Strategy then was to get New Zealand’s transport sector emissions down by 50% by 2040

A ‘cash for clunkers’ scheme is just one of the complementary measures, which could have been funded via Labour’s ETS. Before it was amended by National last year to subsidise emitters at the expense of households, the ETS would have made revenues available from the sale of emissions permits to pay for exactly this sort of measure.

New Zealand’s car fleet has an average age of 12 years.  A ‘cash for clunkers’ scheme would help kiwi households struggling with higher living costs to modernise their cars.  It would help them more easily choose safer, modern, lower-emission, cheaper to run vehicles that would be better for the environment.

Instead of rolling back proposals to lower pollution, like the biofuels obligation; hiding behind the recession to produce a temporary drop in emissions; or pretending that its watered-down ETS will make a difference, the Government should look seriously at schemes like the cleaner car rebate as a practical way to reduce emissions and give families a helping hand.

Same job, same uniform, different pay

Posted by on July 28th, 2010

Qantas has been paying its New Zealand pilots up to 40% less than its Australian pilots, even although they wear the same uniform and fly the same routes.

Positions previously held by Qantas pilots are being lost to Jetconnect pilots as Qantas pay and conditions are much inferior here.

Despite being set up to undertake domestic flights within New Zealand, Jetconnect now operates 154 flights between Australia and New Zealand every week and is effectively an operating division of Qantas, says the Australian Council of Trade Unions (ACTU).

Its New Zealand pilots wear Qantas uniforms, have Qantas staff numbers, and fly Qantas aircraft with travel routes determined by Qantas.

The ACTU says that where workers are doing the same job as Australian workers and in actual fact replacing Australian workers, Australian work legislation should apply to them.

The gap between Australian and New Zealand wages has grown by more than $50 a week since November 2008.  The government has no ideas or plan about how to address this gap, other than to further reduce workers rights.

New Zealand has become a desirable destination for Australian companies who want to pay workers less.

Ernie and me

Posted by on July 28th, 2010

Yesterday Labour expressed major concerns about the Government’s ultrafast broadband project; that two measures underway could derail the goal of affordable and accessible broadband services for New Zealanders.

First, that an operational separation variation request by Telecom NZ could mean to the end of operational separation.

This was a major achievement for New Zealand and has resulted in real competition in the telco sector.

Second, the revelation that the Local Fibre Companies, the private public partnerships set up to manage the $1.5 billion broadband project, will enjoy a 10 year regulatory holiday locking out the Commerce Commission from reviewing prices for fibre available to New Zealand consumers.

Labour has serious concerns that together, the two changes would in essence entrench unscrupulous monopolistic behaviour and keep the Commerce Commission out of the fibre industry for ten years.

Internet NZ has expressed similar concerns. TUANZ, which represents many of the big players in the broadband and telco sector has also expressed some concerns.

I made a mistake by intimating that TUANZ had similar concerns to InternetNZ’s fears that the operational separation variation request by Telecom NZ may amount to the end of operational separation.

I apologise to Ernie Newman, TUANZ CEO, for that. But, I would be very surprised if TUANZ did not share Labour’s and InternetNZ’s concerns. I look forward to talking further with Ernie about it. Will happily supply the muffins.

Judith Collins: Blame Maori

Posted by on July 28th, 2010

On Sunday Judith Collins was quizzed on Q&A about New Zealand’s high rate of inprisonment. Here’s an extract from the exchange:

GUYON: …how can it be that we lock up people at double the rate of France?

JUDITH: Well what we have for instance is we have say 15% of the population Maori…

The Maori Party must be so proud every time they vote to prop up Judith Collins and her National government mates.