Media Release: Jane Kelsey
Sunday August 9 2009
The Privacy Commission has made itself complicit in the surveillance of lawful dissent by the Security Intelligence Service, with chilling implications for academic freedom and critical debate, a university law Professor warns.
“Both agencies have clearly over-stepped any reasonable interpretation of the ‘national security’ grounds for refusing to disclose documents, opening them to legal challenge. That is under active consideration”, said Dr Jane Kelsey, a Professor of Law at the University of Auckland.
“My experience since applying for my SIS file last November reveals two things: there is still no accountability for SIS actions in gathering intelligence on lawful dissent; and the SIS is apparently targeting academic critics of failed free market policies at a time when debate is needed most.”
“The SIS initially refused to confirm or deny whether they held any information on me, claiming that answering that question was itself likely to prejudice national security. They later conceded a file existed, when they realized there were references to me in three pages of the file released on Keith Locke MP.”
“When I complained to the Privacy Commission, they upheld the SIS position. This is utter nonsense. Documents released to other people include information on me and contain innocuous documents similar to those that must appear on my file. None of these could conceivably threaten national security.”
“When the SIS got new powers in the 1990s I warned that they would be used against critics of the free market policies and free trade agreements. This has now proved true.”
“This isn’t about me”, says Professor Kelsey. “The chilling effect of this kind of ‘intelligence’ is likely to intimidate young academics, students and public intellectuals from contributing to critical debate about the discredited ‘neoliberal orthodoxy’. Who wants to be spied on for doing their job?”
“The new culture of openness under SIS director Warren Tucker may have begun with good intentions, but it has now become a sham,” Kelsey said.
Ends.
A background note follows.
BACKGROUND NOTES
The grounds cited by the SIS and Privacy Commission to withhold the file:
The SIS initially refused to confirm or deny whether it held any information on me, claiming disclosing that fact was likely to prejudice national security. The Privacy Commission notes that it would likely have supported that position, had the SIS not discovered that it had released to Keith Locke three pages that referred to me and thereby revealed that I had a file.
Subsequently, the Privacy Commission upheld the decision of the SIS not to release any further documents from my file, because ‘there is a real or substantial risk that the release of the information would disclose knowledge about NZSIS’ operations or capabilities or modus operandi and to do so would have the effect of a prejudice to the endeavours of NZSIS’.
A number of other people engaged in similar activities to my own have been told the dates of the first and last entries, and how many pages or folders there are in their file. This information on my file is being withheld because its release could, in itself, expose or prejudice the reason the information is being withheld. That suggests there is something unique about the size or format of the information in my file.
Elsewhere in our lengthy correspondence the Privacy Commission said the information held may not be sensitive, but the strategies for collecting it may be.
Further, SIS interest in an individual will vary over time and context, suggesting that surveillance focused on certain activities or events.
The Privacy Commission volunteered that it would have endorsed withholding the information by the SIS on another ground, being ‘maintenance of the law, in this case the Service’s ability to ensure the security of New Zealand was not compromised or breached’. It is a reasonable inference from the Privacy Commission’s correspondence that the ‘maintenance of the law’ is code for protecting SIS surveillance techniques and activities.
Information revealed in other people’s files that cannot be considered a threat to national security or disclosing particular modus operandi:
A review of material released to other people reveals five innocuous documents that are presumably also on my file, given the SIS meticulous system of cross-referencing:
- November 1981 ‘MOST’ legal aid workshop run by Jane Kelsey for people arrested in Auckland during the Springbok tour.
- a (wrong) note that Keith Locke was accompanied on a visit to the Philippines in 1988 by two people, one possibly being Jane Kelsey who was the leader of an Asian Human Rights Centre (sic) investigation in 1988.
- a transcript of a Checkpoint item on the Asian Development Bank meeting in Auckland in 1996, where Jane Kelsey is extensively quoted in the capacity of ‘the NZ liaison person for some 30 overseas non-Government organizations concerned about Asian Development Bank policies’.
- an article from Political Review that names Jane Kelsey, Law Faculty, Auckland University as the contact point for information on the APEC Forum and Parallel Programme for the Asian Development Bank meeting.
- an advertisement for a Global Peace and Justice Auckland public forum where Jane Kelsey would speak on ‘Privatisation and Globalisation’.
Other people’s files are said to contain media clippings, although these have generally not been included in documents released because they are publicly available. It is obvious that media articles must also be on my file. Given that they are already in the public domain, releasing them or at least acknowledging they are on the file cannot be ‘likely to prejudice national security’.
Initially, where the SIS was not prepared to release actual documents to people, they provided a summary of the subject matter and reference to the person that was contained in each document. These documents record people’s attendance at various activities, such as Waitangi protests in the 1980s, meetings related to the Springbok tour, Philippines Solidarity and APEC organizing meetings. Other files that have been released include fuller documentation of who attended various political meetings. The SIS stopped providing this information as requests for files increased. Again, it is clear that this kind of information was not considered ‘likely to prejudice national security’ when it was released to others who have engaged in similar activities to me.
SIS activity
The SIS has been especially interested in activities that challenge its own powers. Many people’s files contain a list of people and organizations who made submissions on an amendment to SIS legislation in 1999. I have regularly made submissions on SIS and security legislation in my academic capacity.
Another document notes that Jane Kelsey, associate professor of law at Auckland University spoke to a public meeting in Christchurch on recent expansion of SIS powers, in the context of the SIS break-in to Aziz Choudry’s home in 1996.
The release of neither document can be ‘likely to prejudice national security’.
Academic freedom
The SIS has a long history of spying on academics. The file of economist Wolfgang Rosenberg dates back 50 years, and includes comments he made in the common room and his applications for academic jobs. Recent files of several other academics focus on lawful activities undertaken in the course of their employment as academics, such as giving lectures, participating in conferences and convening meetings on university campuses. Various Students Association groups and activities have also been monitored.
The Education Act confers statutory protection on academic freedom, defined as the ‘freedom of academic staff and students, within the law, to question and test received wisdom, to put forward new ideas and to state controversial or unpopular opinions’, and a responsibility to act as ‘critic and conscience’ of society. Moreover, there is an obligation on all government agencies to preserve and enhance academic freedom.
The potential chilling effect of the SIS maintaining files on academics fulfilling their employment and statutory responsibilities extends beyond the individuals concerned to their engagement with students in lectures or undertaking research, academic colleagues, research funding, advisory work and consultancy. It also sends a message that they may be spied on for simply doing their job.
Critics of economic policies
In the 1996 the SIS powers were amended by defining security to include ‘New Zealand’s economic wellbeing’:
"Security means the making of a contribution to New Zealand's international well-being or economic well-being; and the protection of New Zealand from acts of espionage, sabotage, terrorism, and subversion, whether or not it is directed from or intended to be committed within New Zealand."
Many people, including myself, warned that they would be used against critics of the free market policies and free trade agreements. It became clear from the Choudry case, when Aziz Choudry successfully sued the SIS over the break in to his house during the APEC Finance Ministers’ meeting in Christchurch in 1996, that the SIS was already using interception warrants to monitor APEC protests at least from September 1995.
It also became clear at that time that the SIS held a Personal File on me. As an initiator and spokesperson for the APEC Monitoring Group, it is certain that my activities regarding APEC were being monitored and highly likely my communications were also intercepted, especially during the APEC Leaders meeting in Auckland in 1999.
After extensive submissions from many people, including myself, the Act was amended in 1999 to apply to ‘the identification of foreign capabilities, intentions, or activities within or relating to New Zealand that impact on New Zealand's international well-being or economic well-being’.
Various files contain documents that relate to different aspects of neoliberal economic negotiations, organizations and meetings, such as opposition to the Multilateral Agreement on Investment (MAI), the Asian Development Bank and APEC meetings in Auckland, and a public meeting of Global Peace and Justice Auckland on globalisation. It seems obvious that the SIS has invoked the ‘economic wellbeing’ definition of ‘security’ on numerous occasions, before and after 1999, in ways that far exceed its powers.
As a prominent academic critic of these and similar neoliberal initiatives, I must assume that the SIS has been monitoring my lawful criticism of global free market policies and treaties, possibly through the periodic use of interception warrants. It also once again raises the question of why such information can be released to others, but would its release to me become ‘likely to prejudice national security’?
SAS look set to return to Afghanistan
27 July 2009
According to the just released NZPA article, see copy below, John Key said today: "Whatever decision we make has to be made here in New Zealand in what is perceived to be in the best interests of New Zealand. That is who I answer to, that is the New Zealand public. They are the people entitled to that answer, nobody else."
That seems like a clear invitation for you, and / or your organisation, to send John Key your views about the possibility of the SAS being re-deployed to Afghanistan.His contact details are: (i) at parliament: Free post Parliament, Private Bag 18-888, Parliament Buildings, Wellington 6160; fax (04) 473 3689, email j.key@ministers.govt.nz (ii) electorate office: PO Box 258, Kumeu 0841; fax (09) 412 2497, email john.key@national.org.nz or genelle@johnkey.mp.net.nz
A point to remember when you write, whether or not you agree with the concept of armed forces as 'peacekeepers', the SAS will certainly not be deployed in a peacekeeping role - they are, as it says on their web page, "the premier combat unit of the New Zealand Defence Force" - http://www.army.mil.nz/our-army/nzsas/default.htm The Ministry of Defence's media releases on the last two deployments to Afghanistan, described the SAS's activities as "the planning and execution of long-range reconnaissance and direct action missions inside Afghanistan. They will operate with other special forces from countries contributing to coalitions forces in Afghanistan."
SAS troops previously deployed to Afghanistan have been integrated with other Special Forces in the Combined Joint Special Operations Task Force under US military command. Along with US Special Forces, "six foreign nations including New Zealand and Australia, also assigned some of their best "hunters and killers" to the group" which is headquartered near Bagram air base." - http://ww.globalsecurity.org/military/agency/dod/soccent.htm Clearly not deployments that could be regarded as peacekeeping by any stretch of the imagination ...
This message will be available online at http://www.converge.org.nz/pma /nzsas09.htm later today.
SAS look set to return to Afghanistan
NZPA
27 July 2009
New Zealand's elite troops seem set to return to Afghanistan with Prime Minister John Key saying he is sympathetic to arguments that more troops are needed to stabilise the troubled country.
Mr Key told journalists today that decisions about deployment to Afghanistan would be made in the next few weeks.
United States ambassador to the North Atlantic Treaty Organisation (Nato), Ivo Daalder, has upped the pressure on the government to give further help.
About 140 army, navy and air force personnel are involved in New Zealand's provincial reconstruction team (PRT) operating in Bamiyan province. The team has been there since 2003 and is committed until September 2010 so far.
The Special Air Services (SAS) has been deployed there three times, the last in 2006.
The United States has repeatedly asked for an increased military presence.
My Key said the US position was clear.
"They want to see an increased contribution from Nato and ISAF (International Security Assistance Force) countries of which New Zealand is one," Mr Key said.
"Whether we agree to do that is something our Cabinet needs to consider. My view is that I am somewhat sympathetic to the position on the basis that we see New Zealanders all around the world and they are in harms way."
Mr Key said an unstable Afghanistan would be a base for terrorist attacks around the world.
Dr Daalder said New Zealand should consider not just its relations with the US, but with other allies, particularly Australia.
"God forbid there be a threat directly to New Zealand. Wouldn't it then be good for a country like Holland or Canada or Slovakia or the US to be there `for you'?"
Mr Key said Dr Daalder's words should be taken "with a grain of salt" and if read the wrong way could be taken as putting pressure on New Zealand.
"We don't answer to America...Whatever decision we make has to be made here in New Zealand in what is perceived to be in the best interests of New Zealand. That is who I answer to, that is the New Zealand public. They are the people entitled to that answer, nobody else.
Arguments against sending more troops to Afghanistan included the cost, the danger posed to troops and whether it would achieve anything.
Mr Key agreed that wider diplomatic and strategic assets could be considered, but the primary consideration was whether an increased commitment would work.
Mr Key said Australian Prime Minister Kevin Rudd had indicated there would be an increased commitment to Afghanistan from his forces.
Asked if Australia would want New Zealand to do the same, Mr Key said "I think they always would, but we haven't had any further discussion."
The review was looking at the Bamiyan deployment, which Mr Key said he would prefer to see coming to an end.
"It soaks up a lot of resources, we have been there since 2003. We have done good work there, but at some point I would like to see the mission end and New Zealand able to regroup and use its resources in other places."
Mr Key said New Zealand wanted to see an exit strategy for Afghanistan and if there was an SAS tour of duty it would not be forever.
Any deployment would be based on the same rules of engagement as previously with the New Zealand commander having the final decision on engagement.
<> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <>
Peace Movement Aotearoa (PMA)
the national networking peace organisation
PO Box 9314, Wellington 6141, Aotearoa New Zealand
Tel +64 4 382 8129, fax 382 8173 email pma@xtra.co.nz
PMA website - http://www.converge.org.nz/pma
Not in Our Name - http://www.converge.org.nz/pma/nionnz.htm
<> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <>
>> war on terrorism? war is terrorism <<
<> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <>
According to the just released NZPA article, see copy below, John Key said today: "Whatever decision we make has to be made here in New Zealand in what is perceived to be in the best interests of New Zealand. That is who I answer to, that is the New Zealand public. They are the people entitled to that answer, nobody else."
That seems like a clear invitation for you, and / or your organisation, to send John Key your views about the possibility of the SAS being re-deployed to Afghanistan.His contact details are: (i) at parliament: Free post Parliament, Private Bag 18-888, Parliament Buildings, Wellington 6160; fax (04) 473 3689, email j.key@ministers.govt.nz (ii) electorate office: PO Box 258, Kumeu 0841; fax (09) 412 2497, email john.key@national.org.nz or genelle@johnkey.mp.net.nz
A point to remember when you write, whether or not you agree with the concept of armed forces as 'peacekeepers', the SAS will certainly not be deployed in a peacekeeping role - they are, as it says on their web page, "the premier combat unit of the New Zealand Defence Force" - http://www.army.mil.nz/our-army/nzsas/default.htm The Ministry of Defence's media releases on the last two deployments to Afghanistan, described the SAS's activities as "the planning and execution of long-range reconnaissance and direct action missions inside Afghanistan. They will operate with other special forces from countries contributing to coalitions forces in Afghanistan."
SAS troops previously deployed to Afghanistan have been integrated with other Special Forces in the Combined Joint Special Operations Task Force under US military command. Along with US Special Forces, "six foreign nations including New Zealand and Australia, also assigned some of their best "hunters and killers" to the group" which is headquartered near Bagram air base." - http://ww.globalsecurity.org/military/agency/dod/soccent.htm Clearly not deployments that could be regarded as peacekeeping by any stretch of the imagination ...
This message will be available online at http://www.converge.org.nz/pma /nzsas09.htm later today.
SAS look set to return to Afghanistan
NZPA
27 July 2009
New Zealand's elite troops seem set to return to Afghanistan with Prime Minister John Key saying he is sympathetic to arguments that more troops are needed to stabilise the troubled country.
Mr Key told journalists today that decisions about deployment to Afghanistan would be made in the next few weeks.
United States ambassador to the North Atlantic Treaty Organisation (Nato), Ivo Daalder, has upped the pressure on the government to give further help.
About 140 army, navy and air force personnel are involved in New Zealand's provincial reconstruction team (PRT) operating in Bamiyan province. The team has been there since 2003 and is committed until September 2010 so far.
The Special Air Services (SAS) has been deployed there three times, the last in 2006.
The United States has repeatedly asked for an increased military presence.
My Key said the US position was clear.
"They want to see an increased contribution from Nato and ISAF (International Security Assistance Force) countries of which New Zealand is one," Mr Key said.
"Whether we agree to do that is something our Cabinet needs to consider. My view is that I am somewhat sympathetic to the position on the basis that we see New Zealanders all around the world and they are in harms way."
Mr Key said an unstable Afghanistan would be a base for terrorist attacks around the world.
Dr Daalder said New Zealand should consider not just its relations with the US, but with other allies, particularly Australia.
"God forbid there be a threat directly to New Zealand. Wouldn't it then be good for a country like Holland or Canada or Slovakia or the US to be there `for you'?"
Mr Key said Dr Daalder's words should be taken "with a grain of salt" and if read the wrong way could be taken as putting pressure on New Zealand.
"We don't answer to America...Whatever decision we make has to be made here in New Zealand in what is perceived to be in the best interests of New Zealand. That is who I answer to, that is the New Zealand public. They are the people entitled to that answer, nobody else.
Arguments against sending more troops to Afghanistan included the cost, the danger posed to troops and whether it would achieve anything.
Mr Key agreed that wider diplomatic and strategic assets could be considered, but the primary consideration was whether an increased commitment would work.
Mr Key said Australian Prime Minister Kevin Rudd had indicated there would be an increased commitment to Afghanistan from his forces.
Asked if Australia would want New Zealand to do the same, Mr Key said "I think they always would, but we haven't had any further discussion."
The review was looking at the Bamiyan deployment, which Mr Key said he would prefer to see coming to an end.
"It soaks up a lot of resources, we have been there since 2003. We have done good work there, but at some point I would like to see the mission end and New Zealand able to regroup and use its resources in other places."
Mr Key said New Zealand wanted to see an exit strategy for Afghanistan and if there was an SAS tour of duty it would not be forever.
Any deployment would be based on the same rules of engagement as previously with the New Zealand commander having the final decision on engagement.
<> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <>
Peace Movement Aotearoa (PMA)
the national networking peace organisation
PO Box 9314, Wellington 6141, Aotearoa New Zealand
Tel +64 4 382 8129, fax 382 8173 email pma@xtra.co.nz
PMA website - http://www.converge.org.nz/pma
Not in Our Name - http://www.converge.org.nz/pma/nionnz.htm
<> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <>
>> war on terrorism? war is terrorism <<
<> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <> <>
WAIHOPAI SPYBASE PROTEST January 22-24, 2010
The Waihopai spybase was dragged into the public spotlight in April 2008 when three Ploughshares peace activists penetrated its high security and deflated one of the two domes concealing its satellite dishes from the NZ public. The Anti-Bases Campaign was happy to support this non-violent direct action anti-war activity (which is yet to come to trial).
The public face of New Zealand’s role as an American ally is the NZ military presence in Afghanistan. But New Zealand’s most significant contribution to that, and other American wars, including the one in Iraq, is the Waihopai electronic intelligence gathering base, located in the Waihopai Valley, near Blenheim. It is controlled by the US, with New Zealand (including Parliament and the Prime Minister) having little or no idea what goes on there, let alone any control.
First announced in 1987, Waihopai is operated by New Zealand’s Government Communications Security Bureau (GCSB) in the interests of the foreign Powers grouped together in the super-secret UKUSA Agreement (which shares global electronic and signals intelligence among the intelligence agencies of the US, UK, Canada, Australia and NZ). Its two satellite interception dishes intercept a huge volume of civilian telephone calls, telexes, faxes, e-mail and computer data communications. It spies on our Asia/Pacific neighbours, and forwards the material on to the major partners in the UKUSA Agreement, specifically the US National Security Agency (NSA). Its targets are international civilian communications involving New Zealanders, including the interception of international phone calls. Post- 9/11 the GCSB and Waihopai now spy further afield, to those regions where the US is waging wars. The codename for this – Echelon – has become notorious worldwide as the vast scope of its spying has become public. New Zealand is an integral, albeit junior part of a global spying network, a network that is ultimately accountable only to its own constituent agencies, not governments, not citizens.
Join us for the weekend of anti-war protest at this spybase. Come prepared for roughing it and camping out. We provide the food (we cater for vegetarians but vegans will have to bring their own). Bring sleeping bag, groundsheet, a tent, torch, water bottle, eating utensils, clothing for all weather, and $40 (or $20 unwaged) to cover costs. No open fires.
How to find our camp at Whites Bay: turn off SH1 at Tuamarina (9km north of Blenheim or 20 km south of Picton) and drive to Rarangi on the coast. Follow the steep Port Underwood Road over the hilltop before descending to the Whites Bay turnoff. There is a DoC public camp at the bay with basic facilities. ABC has to pay a fixed charge per head.
This will be the first Waihopai spybase protest since the Domebusters’ courageous 2008 citizens’ deflation action. Waihopai does not operate in the interests of New Zealanders or our neighbours. Basically it is a foreign spybase on NZ soil and directly involves us in America’s wars. Waihopai must be closed.
I want to take part in the Weekend of Protest
Name______________________________________________________________________________
Address____________________________________________________________________________
T/F/Email___________________________________________________________________________
q I enclose $40 ($20 unwaged) per person registration to cover costs $______
q I want to make a donation to the Waihopai campaign $_______
q I can help with publicity in my area or network – Yes/No
q I want to join the Anti-Bases Campaign. Annual membership is $20 ______
( includes subscription to Peace Researcher)
CLOSE THE WAIHOPAI SPYBASE NOW!
Organised by the Anti-Bases Campaign, P.O. Box 2258, Christchurch.
E-mail cafca@chch.planet.org.nz www.converge.org.nz/abc
Make all cheques to ABC
The public face of New Zealand’s role as an American ally is the NZ military presence in Afghanistan. But New Zealand’s most significant contribution to that, and other American wars, including the one in Iraq, is the Waihopai electronic intelligence gathering base, located in the Waihopai Valley, near Blenheim. It is controlled by the US, with New Zealand (including Parliament and the Prime Minister) having little or no idea what goes on there, let alone any control.
First announced in 1987, Waihopai is operated by New Zealand’s Government Communications Security Bureau (GCSB) in the interests of the foreign Powers grouped together in the super-secret UKUSA Agreement (which shares global electronic and signals intelligence among the intelligence agencies of the US, UK, Canada, Australia and NZ). Its two satellite interception dishes intercept a huge volume of civilian telephone calls, telexes, faxes, e-mail and computer data communications. It spies on our Asia/Pacific neighbours, and forwards the material on to the major partners in the UKUSA Agreement, specifically the US National Security Agency (NSA). Its targets are international civilian communications involving New Zealanders, including the interception of international phone calls. Post- 9/11 the GCSB and Waihopai now spy further afield, to those regions where the US is waging wars. The codename for this – Echelon – has become notorious worldwide as the vast scope of its spying has become public. New Zealand is an integral, albeit junior part of a global spying network, a network that is ultimately accountable only to its own constituent agencies, not governments, not citizens.
Join us for the weekend of anti-war protest at this spybase. Come prepared for roughing it and camping out. We provide the food (we cater for vegetarians but vegans will have to bring their own). Bring sleeping bag, groundsheet, a tent, torch, water bottle, eating utensils, clothing for all weather, and $40 (or $20 unwaged) to cover costs. No open fires.
How to find our camp at Whites Bay: turn off SH1 at Tuamarina (9km north of Blenheim or 20 km south of Picton) and drive to Rarangi on the coast. Follow the steep Port Underwood Road over the hilltop before descending to the Whites Bay turnoff. There is a DoC public camp at the bay with basic facilities. ABC has to pay a fixed charge per head.
This will be the first Waihopai spybase protest since the Domebusters’ courageous 2008 citizens’ deflation action. Waihopai does not operate in the interests of New Zealanders or our neighbours. Basically it is a foreign spybase on NZ soil and directly involves us in America’s wars. Waihopai must be closed.
I want to take part in the Weekend of Protest
Name______________________________________________________________________________
Address____________________________________________________________________________
T/F/Email___________________________________________________________________________
q I enclose $40 ($20 unwaged) per person registration to cover costs $______
q I want to make a donation to the Waihopai campaign $_______
q I can help with publicity in my area or network – Yes/No
q I want to join the Anti-Bases Campaign. Annual membership is $20 ______
( includes subscription to Peace Researcher)
CLOSE THE WAIHOPAI SPYBASE NOW!
Organised by the Anti-Bases Campaign, P.O. Box 2258, Christchurch.
E-mail cafca@chch.planet.org.nz www.converge.org.nz/abc
Make all cheques to ABC
Waihopai Spybase's New Dome To "Protect Dish From Weather". Yeah, Right
“It (the Waihopai spybase’s new dome, being installed today) is inflated to two PSI (pounds per square inch) above atmospheric pressure and designed to protect the satellite (sic – dish) from the weather not hide the direction that the satellite (sic – dish) is pointed, as has been popularly believed”. Full story at http://www.stuff.co.nz/national/2663681/Spy-base-ready-for-new-dome
Yeah ,right.
In which case, why isn’t Telecom’s big satellite dish at Warkworth under a dome to “protect it from the weather”? Or the big satellite dishes on the roofs at TV1 and TV3 in Auckland? Or. Come to think, the hundreds of thousands of satellite TV dishes on buildings and houses up and down the country?
Of course the purpose of the domes at Waihopai is to conceal the direction in which the dishes are being pointed, in order to conceal which international civilian telecommunications satellites they are spying on. Actually the Stuff report quoted above has a Freudian slip in that it uses the word “satellite” instead of “dish”. That’s it in a nutshell – the domes are to conceal what satellites are being spied on.
Please turn the question around and ask the NZ Government Communications Security Bureau if they, and their masters in the US National Security Agency, don’t mind at all if anyone can see which way their spy dishes are pointing and can therefore work out who and what they’re spying on? Do a quick Google search of other spybases – Pine Gap in Australia or Menwith Hill in the UK, for example – and tell us how many uncovered dishes you can see as opposed to ones concealed by domes.
Please stop falling for the GCSB line that, uniquely, Waihopai’s satellite dishes have to be covered by domes to stop them getting wet or blowing away.
Yeah ,right.
In which case, why isn’t Telecom’s big satellite dish at Warkworth under a dome to “protect it from the weather”? Or the big satellite dishes on the roofs at TV1 and TV3 in Auckland? Or. Come to think, the hundreds of thousands of satellite TV dishes on buildings and houses up and down the country?
Of course the purpose of the domes at Waihopai is to conceal the direction in which the dishes are being pointed, in order to conceal which international civilian telecommunications satellites they are spying on. Actually the Stuff report quoted above has a Freudian slip in that it uses the word “satellite” instead of “dish”. That’s it in a nutshell – the domes are to conceal what satellites are being spied on.
Please turn the question around and ask the NZ Government Communications Security Bureau if they, and their masters in the US National Security Agency, don’t mind at all if anyone can see which way their spy dishes are pointing and can therefore work out who and what they’re spying on? Do a quick Google search of other spybases – Pine Gap in Australia or Menwith Hill in the UK, for example – and tell us how many uncovered dishes you can see as opposed to ones concealed by domes.
Please stop falling for the GCSB line that, uniquely, Waihopai’s satellite dishes have to be covered by domes to stop them getting wet or blowing away.
Ploughshares Trial Moved To Wellington
The trail of the three activists who deflated one of the domes at the Waihopai Spybase will face trial on the 8th March in Wellington. The trial was moved to from Blenheim courts because of the high likelihood of a biased jury and because of the ongoing actions of the Anti Bases Campaign over the last decades.
“OBSOLETE”! Christchurch City Council Quietly Scraps Its Progressive Foreign Investment Policy
- Murray Horton
Not so many years ago, when the Christchurch City Council was justly proud of the title “The People’s Republic of Christchurch” bestowed on it by the Business Round Table, it adopted a number of progressive policies on foreign investment and free trade agreements. In the late 1990s, there was a successful international campaign to stop the Multilateral Agreement on Investment (MAI) which was intended as an omnibus global agreement on foreign investment, a determined attempt to throw open the world’s economies to the transnational corporations in one king hit. It had major implications for not just central governments but all local governments. Local government became an important battleground in the global campaign, in countries such as Canada and here in New Zealand. I’ll quote from the “Think Globally, Act Local Governmentally” section of my cover story, “MAI Down But Not Out: The Struggle Continues”, in Watchdog 87, June 1998 (not online but there are moves afoot to put online issues 81-91 inclusive, 1996-99. Currently number 92, December 1999, is the oldest online issue).
“In Christchurch, CAFCA made the local government angle our speciality. In December 1997, Bill Rosenberg and GATT Watchdog’s Leigh Cookson appeared before a joint Christchurch City Council/Canterbury Regional Council committee to point out the MAI’s implications. In April 1998, Bill Rosenberg and myself appeared before the City Council’s strategy and resources committee. This is a particularly influential committee. Chaired by David Close, it includes the retiring Mayor, Vicki Buck, and the two leading mayoral candidates, Margaret Murray and Garry Moore (who went on to be Christchurch’s Mayor from 1998-2007). Bill had done excellent work by writing a briefing paper for the committee, spelling out the Christchurch implications of the MAI…
“It wasn’t just CAFCA which expressed concerns to the committee. Chris Pickrill, the chief executive of the Canterbury Development Corporation, wrote a paper outlining his concerns about the MAI (loss of sovereignty; loss of local control; secrecy and unaccountability). He came up with a list of recommendations that weren’t far short of CAFCA’s. All of this had an impact – the councillors had read and digested the material. Mayor Buck declared herself in support of foreign investment but found the MAI scary. She correctly pointed out that if the MAI had been in force when the City Council awarded the city’s rubbish collection contract to French transnational corporation Onyx, the Council could not have insisted on any conditions, such as retaining the Council dustmen (mind you, the City Council shouldn’t have awarded the contract to a TNC, full stop). Councillor Alister James, chairman of Christchurch City Holdings (the Council holding company which owns the city’s trading assets) thanked CAFCA for bringing the MAI’s implications to his attention.
Unanimous Vote Of Opposition & To Urge Other Councils To Do The Same
“CAFCA recommended that the committee come out against the MAI or, if couldn’t do that, urge the Government to add all New Zealand local government to its list of reservations. The committee recommended to the full Council that the MAI be further researched; that its signing be deferred until all interested parties have a chance to make submissions to a Parliamentary select committee; that the City Council develop its own list of reservations to protect its current social, environmental, and economic policies; and that Government add local government to its reservations. This committee, representing the local wings of Labour and National, passed these recommendations unanimously.
“The committee had also recommended that other major city councils be advised of Christchurch’s decision and the MAI’s implications for local governments. The full Council watered this down a bit, to one of supporting the position of Local Government New Zealand, as expressed in its March 1998 letter to the Prime Minister. ‘We are particularly concerned that local government has not been informed and consulted about the proposed Agreement, if it is in fact true that participation in the Agreement would impose obligations and potential liabilities on sub-national governments…It seems wholly inappropriate that these jurisdictions should be constrained by an Agreement to which local government was not a party and which has not been debated or sanctioned by Parliament…’ (LGNZ letter to PM, 30/3/98). The recommendation on further researching the MAI was changed to one of keeping a watching brief on it and other similar projects…
“This was a very valuable exercise from our point of view. CAFCA had directly approached the country’s second biggest local body and was instrumental in persuading it to, if not declare Christchurch an MAI free zone, then to exress opposition to it and take specific steps to blunt its impact on local government. None of this was reported by the Press, which has tried hard to avoid mentioning the MAI at all (except to editorially support it, of course). The report of the committee meeting was spiked; by the time it got to the full Council, the Press, in its wisdom, had decided that the MAI was a dead duck and not worth reporting at all. It was left to the Christchurch Mail, glorified junkmail, to cover it…”
Nor was this a one-off by the Council. It took a consistently progressive policy on the various free trade and investment agreements that the Government, whether National or Labour, kept signing us up to or negotiating to do so. It came out against the Agreement with Singapore (which has been in place since 2001) and the proposed one with Hong Kong (negotiations on this stalled back in 2002 and have only been restarted in 2009, so this proposed Agreement and the Christchurch City Council’s opposition to it is a very current issue. See “Hong Kong Free Trade And Investment Agreement: Deal Not Done Yet”, by Bill Rosenberg, in Watchdog 97, August 2001, online at http://www.converge.org.nz/watchdog/97/4.htm).
A Backward Step
So far so very commendable. This policy remained the status quo for more than a decade, although you’d have to say that the Council didn’t pay much attention to it in 2006 when it tried very hard to flog off the Lyttelton Port Company to a Hong Kong transnational (unsuccessfully, and CAFCA played its part in defeating that reprehensible move). Bearing that in mind, maybe it wasn’t a surprise that the writing was on the wall. That 1998 resolution about the MAI and foreign investment was quietly revoked, without any publicity, at a May 2009 City Council meeting, on the grounds that it is “obsolete”.
The resolution was in five parts. To quote two of them: “That the Christchurch City Council reaffirms a commitment to the encouragement of controlled and managed foreign investment in the city that is consistent with broader local government social, environmental and economic development policies” and: “That a watching brief be kept on the implications of the effects of the MAI or similar projects in NZ and Christchurch City”. What is “obsolete” about any of that? It sounds pretty current and necessary to CAFCA.
The Councillors who voted 11 to 2 to revoke it in 2009 could be forgiven for not recognising the negative significance of what they were doing. “Foreign Investment” was buried as number 11 in a list of 25 “obsolete” policies to be revoked by a single vote. Officials put the list of completely unrelated and unexplained policies in front of Councillors in one indigestible lump and they were all duly revoked under a motion headed: “That the Council remove by revocation from the Policy Register the 25 items in the list contained in Appendix A of the agenda on page 37”. That’s as clear as mud, now isn’t it? This was drawn to CAFCA’s attention, we put out a press release but, as when the policy was first adopted in 1998, its quiet abandonment by the Council attracted no media coverage.
The Council is undoing all the good work that its predecessors have done on this issue, work which deservedly gave Christchurch the national reputation as having the most progressive local government in the country. These free trade and foreign investment agreements have major consequences at the local government level, where the transnationals eagerly anticipate rich pickings, in the areas like water, roads and the whole range of local government services. Is the Council laying the ground for a sell off of public assets under the guise of revoking “obsolete” policies? The people of Christchurch are entitled to an answer from our elected representatives.
Not so many years ago, when the Christchurch City Council was justly proud of the title “The People’s Republic of Christchurch” bestowed on it by the Business Round Table, it adopted a number of progressive policies on foreign investment and free trade agreements. In the late 1990s, there was a successful international campaign to stop the Multilateral Agreement on Investment (MAI) which was intended as an omnibus global agreement on foreign investment, a determined attempt to throw open the world’s economies to the transnational corporations in one king hit. It had major implications for not just central governments but all local governments. Local government became an important battleground in the global campaign, in countries such as Canada and here in New Zealand. I’ll quote from the “Think Globally, Act Local Governmentally” section of my cover story, “MAI Down But Not Out: The Struggle Continues”, in Watchdog 87, June 1998 (not online but there are moves afoot to put online issues 81-91 inclusive, 1996-99. Currently number 92, December 1999, is the oldest online issue).
“In Christchurch, CAFCA made the local government angle our speciality. In December 1997, Bill Rosenberg and GATT Watchdog’s Leigh Cookson appeared before a joint Christchurch City Council/Canterbury Regional Council committee to point out the MAI’s implications. In April 1998, Bill Rosenberg and myself appeared before the City Council’s strategy and resources committee. This is a particularly influential committee. Chaired by David Close, it includes the retiring Mayor, Vicki Buck, and the two leading mayoral candidates, Margaret Murray and Garry Moore (who went on to be Christchurch’s Mayor from 1998-2007). Bill had done excellent work by writing a briefing paper for the committee, spelling out the Christchurch implications of the MAI…
“It wasn’t just CAFCA which expressed concerns to the committee. Chris Pickrill, the chief executive of the Canterbury Development Corporation, wrote a paper outlining his concerns about the MAI (loss of sovereignty; loss of local control; secrecy and unaccountability). He came up with a list of recommendations that weren’t far short of CAFCA’s. All of this had an impact – the councillors had read and digested the material. Mayor Buck declared herself in support of foreign investment but found the MAI scary. She correctly pointed out that if the MAI had been in force when the City Council awarded the city’s rubbish collection contract to French transnational corporation Onyx, the Council could not have insisted on any conditions, such as retaining the Council dustmen (mind you, the City Council shouldn’t have awarded the contract to a TNC, full stop). Councillor Alister James, chairman of Christchurch City Holdings (the Council holding company which owns the city’s trading assets) thanked CAFCA for bringing the MAI’s implications to his attention.
Unanimous Vote Of Opposition & To Urge Other Councils To Do The Same
“CAFCA recommended that the committee come out against the MAI or, if couldn’t do that, urge the Government to add all New Zealand local government to its list of reservations. The committee recommended to the full Council that the MAI be further researched; that its signing be deferred until all interested parties have a chance to make submissions to a Parliamentary select committee; that the City Council develop its own list of reservations to protect its current social, environmental, and economic policies; and that Government add local government to its reservations. This committee, representing the local wings of Labour and National, passed these recommendations unanimously.
“The committee had also recommended that other major city councils be advised of Christchurch’s decision and the MAI’s implications for local governments. The full Council watered this down a bit, to one of supporting the position of Local Government New Zealand, as expressed in its March 1998 letter to the Prime Minister. ‘We are particularly concerned that local government has not been informed and consulted about the proposed Agreement, if it is in fact true that participation in the Agreement would impose obligations and potential liabilities on sub-national governments…It seems wholly inappropriate that these jurisdictions should be constrained by an Agreement to which local government was not a party and which has not been debated or sanctioned by Parliament…’ (LGNZ letter to PM, 30/3/98). The recommendation on further researching the MAI was changed to one of keeping a watching brief on it and other similar projects…
“This was a very valuable exercise from our point of view. CAFCA had directly approached the country’s second biggest local body and was instrumental in persuading it to, if not declare Christchurch an MAI free zone, then to exress opposition to it and take specific steps to blunt its impact on local government. None of this was reported by the Press, which has tried hard to avoid mentioning the MAI at all (except to editorially support it, of course). The report of the committee meeting was spiked; by the time it got to the full Council, the Press, in its wisdom, had decided that the MAI was a dead duck and not worth reporting at all. It was left to the Christchurch Mail, glorified junkmail, to cover it…”
Nor was this a one-off by the Council. It took a consistently progressive policy on the various free trade and investment agreements that the Government, whether National or Labour, kept signing us up to or negotiating to do so. It came out against the Agreement with Singapore (which has been in place since 2001) and the proposed one with Hong Kong (negotiations on this stalled back in 2002 and have only been restarted in 2009, so this proposed Agreement and the Christchurch City Council’s opposition to it is a very current issue. See “Hong Kong Free Trade And Investment Agreement: Deal Not Done Yet”, by Bill Rosenberg, in Watchdog 97, August 2001, online at http://www.converge.org.nz/watchdog/97/4.htm).
A Backward Step
So far so very commendable. This policy remained the status quo for more than a decade, although you’d have to say that the Council didn’t pay much attention to it in 2006 when it tried very hard to flog off the Lyttelton Port Company to a Hong Kong transnational (unsuccessfully, and CAFCA played its part in defeating that reprehensible move). Bearing that in mind, maybe it wasn’t a surprise that the writing was on the wall. That 1998 resolution about the MAI and foreign investment was quietly revoked, without any publicity, at a May 2009 City Council meeting, on the grounds that it is “obsolete”.
The resolution was in five parts. To quote two of them: “That the Christchurch City Council reaffirms a commitment to the encouragement of controlled and managed foreign investment in the city that is consistent with broader local government social, environmental and economic development policies” and: “That a watching brief be kept on the implications of the effects of the MAI or similar projects in NZ and Christchurch City”. What is “obsolete” about any of that? It sounds pretty current and necessary to CAFCA.
The Councillors who voted 11 to 2 to revoke it in 2009 could be forgiven for not recognising the negative significance of what they were doing. “Foreign Investment” was buried as number 11 in a list of 25 “obsolete” policies to be revoked by a single vote. Officials put the list of completely unrelated and unexplained policies in front of Councillors in one indigestible lump and they were all duly revoked under a motion headed: “That the Council remove by revocation from the Policy Register the 25 items in the list contained in Appendix A of the agenda on page 37”. That’s as clear as mud, now isn’t it? This was drawn to CAFCA’s attention, we put out a press release but, as when the policy was first adopted in 1998, its quiet abandonment by the Council attracted no media coverage.
The Council is undoing all the good work that its predecessors have done on this issue, work which deservedly gave Christchurch the national reputation as having the most progressive local government in the country. These free trade and foreign investment agreements have major consequences at the local government level, where the transnationals eagerly anticipate rich pickings, in the areas like water, roads and the whole range of local government services. Is the Council laying the ground for a sell off of public assets under the guise of revoking “obsolete” policies? The people of Christchurch are entitled to an answer from our elected representatives.
THE GLOBAL ECONOMIC CRISIS, FREE TRADE AGREEMENTS & PRIVATISATION
- Murray Horton
You don’t need me to tell you that the world is in a once in a century economic crisis right now. As capitalism (which is usually misleadingly labelled as “democracy”) was declared the winner of the nearly 50 year long Cold War, and capitalist triumphalism was the dominant theme of the past two decades, along with American unilateralism, this means that what we are experiencing is a genuine, full blown crisis of capitalism. I should say at the outset that, unfortunately, I do not share the view that this means “the death of capitalism”. It has survived and mutated into new forms throughout all its previous great and small crises, including the 1930s’ Depression, which is the only precedent for what we’re experiencing now. It won’t die unless something kills it. As my old mate Chairman Mao said: “If you don’t hit it, it won’t fall”. But that’s a whole different subject from what we’re discussing today. I do hope, for all our sakes, that this crisis does not mutate into fascism and world war as the last one did (but there are worrying signs in some particularly stressed parts of the world).
The consensus seems to be that the full force of the tsunami hasn’t yet reached our distant shores and the worst is still to come, that NZ is maybe 12 months behind the rest of the world. It is easy to deny that what has happened in the much bigger and quite different economies of, say, the US and Britain, won’t be replicated here. After all, our banks did not get into the outright criminality of subprime mortgages, nor do we have crippling imperialist wars to finance, such as those in Iraq and Afghanistan. So, it is instructive to consider what has happened to a comparable country, namely Ireland, once known as the Celtic Tiger. Ireland has a similar size population, used to rely on agriculture as its mainstay, has always exported people as we do (except on a considerably greater scale), and had systemic high unemployment. The cure for all of this was supposed to be foreign investment, with all sorts of inducements offered to the transnational corporations (TNCs), particularly those in the manufacturing end of the high tech electronic industry, to get them to set up shop. For a while there things were rosy indeed and the country boomed, particularly the housing market (does that sound familiar?). Ireland was regularly cited as a model for NZ, an example of a country that had moved to a “new, smart” economy. But now the TNCs like computer giant Dell are quitting Ireland for cheaper labour locations such as Poland.
To quote Time (6/4/09): “The good times owed much to the arrival of foreign-owned companies like Dell – such firms account for almost 90% of Irish exports and more than two thirds of the country’s business research and development – so the scaling down of a flagship investor is a real blow. It’s not the only one. After more than a decade of rampant growth, Ireland now looks anaemic. A burst property bubble has landed the country in a deep recession. The economy could shrink as much as 6.5% this year, with unemployment set to reach 12%. Irish banks – massively exposed to property – look wobbly, and as tax receipts dwindle, public finances are in a mess”. The parallel is not exact, of course – foreign investors in NZ have tended not to actually set up very much by way of manufacturing plants here, and NZ manufacturers have headed for the cheaper labour of anywhere from Fiji to China to Mexico and Thailand (in the case of Fisher and Paykel) in the past two decades. So NZ manufacturing was already buggered before this latest crisis came along. But there is enough commonality there to sound a very loud warning to NZ. If you put all your eggs in the basket marked “foreign investment”, prepare to be left with just a mess of broken eggs.
What the major capitalist countries are doing is throwing unimaginably huge sums of money at the problem in an attempt to “save capitalism” (or, at least, to save the skins of their respective ruling classes who got them into the mess in the first place). Some more excitable commentators have described this as socialism. No such luck, it is simply State capitalism on an enormous scale. But, whatever it is called, it represents a fundamentally different species of capitalism to the completely laissez faire variety that has been globally running amok for the past 30 odd years. The more perceptive of the capitalist leaders have recognised that things can not simply proceed as they did before, or else this whole scenario will be repeated. In short, something has to change.
I should stress that this is not the consensus view by any means – for many of the “masters of the universe” currently down on their luck, all that they want is the American or European or whichever taxpayers to dig them out of the hole they have dug themselves into, so that they can go straight back to doing things exactly how they were doing them before. In other words, they want to exactly repeat the behaviour which brought about this whole mess in the first place. The closest analogy is of a drug addict begging his family to give him the means to buy more drugs so that he can carry on with his destructive addiction. The jury is still very much out on whether these mind boggling bailouts in the US and elsewhere will actually “save capitalism” or just briefly prolong the lifespan of the dominant, extremely dysfunctional version of it, namely finance capital.
But nothing has changed as far as good old New Zealand is concerned. I’ve already said that there is a tsunami coming but our Government is running full tilt towards it, transfixed by the big, shiny wave. While the rest of the capitalist world is now full of born again Keynesians (and Marx is being studied again as the most insightful critic of capitalism). But National and Act, and their strangely silent Maori Party partner, are still living in the recent past, where the patron saints were Adam Smith, Friedrich von Hayek and Milton Friedman, not to mention Roger Douglas. They are behaving as if nothing has happened or, even worse, that nothing is going to happen.
Bill English’s first Budget did not repeat Ruth Richardson’s monumental 1991 blunder of bashing the poor and slashing benefits (which have never recovered the lost ground) but it also didn’t do anything much to prepare the country for the turbulence ahead. I don’t care about the tax cuts being scrapped, I congratulate National for doing so. But by stopping the Government’s annual contribution to the Super Fund for ten years sends a clear message that universal old age pensions will be under serious threat in the not too distant future. English said that there is no point investing taxpayers’ money into the bottomless pit that currently constitutes the global markets. Correct, so why not do what should have done in the first place when Michael Cullen set up that Fund and invest it into NZ instead. There is no shortage of infrastructure, health and education projects that could be built or improved with a decent infusion of cash. I’m a cyclist but I really don’t see the building of a national cycleway as the Government’s top priority in its economic stimulus package. Come on, boys, you can do better than that.
A distinguishing characteristic of this denial of reality is the Government’s continued fixation on foreign “investment” as the answer to all questions. It got elected as “Labour Lite” (actually Labour was pretty much “Labour Lite” in the first place) but has decided that the already considerably liberalised Overseas Investment Act, which came into force only as recently as 2005 (Michael Cullen’s legacy) is “too tough” on the poor old TNCs and needs to be eased up even further. Bill English has announced a review of the Act, to be completed by the end of June, with new legislation ready by later this year. As the review has not yet been completed, we don’t know the details, but from what we’ve seen of the review’s terms of reference, you can bet dollars to doughnuts that it will call for the door to be thrown wide open or, even better, ripped off the hinges. Tories are fond of calling for “locking them up and throwing away the key” in relation to crime; in the case of foreign investment, they call for unlocking the door and throwing away the key so that it can’t be locked again. I see this obsession with foreign investment (what they like to call “an open economy”) as being like a cargo cult, with the Government of the day (and it is a bipartisan obsession, with Labour equally as guilty) frantically cutting landing strips in the jungle and awaiting the arrival of the big shiny planes that will come out of the sky and bring all the cargo that will solve all our problems.
Two other broken down old nags make up this trifecta of losers – privatisation and “free trade”. New Zealand is a heavy backer of both. Privatisation is a very touchy subject for Tory strategists because the New Zealand people have had so much negative experience of it, and don’t want any more of it. It was given free rein here in the 80s and 90s and was a bloody disaster. Key got elected by promising not to privatise any State assets during his first term, including the likes of Kiwi Rail which was only renationalised by Labour in its last few months in power. This election promise is one which will stick in the throat of the National and Act ideologues and they will be working overtime to think up ways to privatise things without actually calling it privatisation. Hence the talk of “opening up ACC to competition” (which will come from the global insurance TNCs – the mates of AIG, the US insurance giant which has come to personify everything that is wrong with the global financial sector) rather than baldly announcing that ACC is to be flogged off. Hence the death by a thousand cuts of TVNZ. To give just the most recent example – if you want to watch the 2011 Rugby World Cup in its entirety, you’ll need to pay for Sky TV, it won’t all be on free to air. So, TVNZ loses more and more of the prizes and its demise becomes a self-fulfilling prophecy as viewers feel compelled to switch to Sky. Then the Government will be able to self righteously wring its hands and say that it has no alternative but to sell TVNZ, for a bargain price. Hence the new fashion of Public Private Partnerships in sectors such as roads and other infrastructure, with these PPPs (first championed by Labour) being seen as a more acceptable alternative to outright privatisation, with the added benefit for the TNCs that they don’t have to shoulder all the cost and the risk. Hence the sudden push for private prisons to be allowed back as a “solution” to the problem of soaring rates of imprisonment (and isn’t that making a big difference to the crime rate? But that’s another story).
“Free” trade is an absolute item of faith for both National and Labour, who use it to look at the world down the wrong end of the telescope. Jane Kelsey has described the bipartisan approach as being “what is good for Fonterra is good for New Zealand”, meaning there is an absolute obsession with opening up global markets for NZ agricultural products, with no concern whatsoever for the disastrous impacts of the reciprocal opening of the NZ economy (nor for the truly catastrophic effects that “free” trade has on the poor countries who comprise the majority of the world’s people – but that’s a separate subject). New Zealand, who gifted Mike Moore to the world as one of its Directors General, has been monomaniacal in its drive to get the Doha Round of the World Trade Organisation wrapped up. But, despite our best efforts, the talks are hopelessly stalled. Why? Because other countries, including the very biggest capitalist ones, are not as keen as us to jump off the cliff, trusting only in “the market” to ensure a safe landing. All of those other countries quite unashamedly have their own national interests to be protected. And that has only become more apparent as both the US and European countries have reaffirmed their support for subsidies for their farmers, leaving NZ out on a limb impotently hissing furiously about how could they do this to us, we had jumped over the cliff of free trade on the promise that our erstwhile friends would jump over with us and surprise, surprise, they’re still on the cliff top waving us goodbye and asking us if it hurts yet. What’s that old saying about look before you leap?
Both National and Labour governments have worked tirelessly to sign NZ up to free trade agreements, any free trade agreements. If the multilateral WTO talks are bogged down, then NZ hares off after other regional or bilateral agreements with anyone who will have us. It’s worth listing what trade agreements NZ is already in:
Closer Economic Relations with Australia;
multilateral agreements with the Association of South East Asian Nations; the Pacific Agreement on Closer Economic Relations (with various Pacific countries); the Pacific Four (P4) Agreement with Singapore, Chile and Brunei;
bilateral Free Trade Agreements with China, Singapore and Thailand;
and bilateral investment agreements with Hong Kong and China.
In addition, the following Free Trade Agreements are currently under negotiation by the NZ government:
An expanded P4, now called the Transpacific, involving the US, Singapore, Brunei, Chile, Australia, Peru and perhaps Vietnam and others;
South Korea;
Hong Kong;
Gulf States;
and India.
New Zealand is nothing if not persistent. The proposed Hong Kong Free Trade Agreement stalled in 2002, under Labour, and the restart of negotiations was only announced this year. Of those currently under negotiation the most important is the Transpacific, because its announcement in the final few months of the Labour government was heralded as the means to secure the Holy Grail of a Free Trade Agreement with the US. Fortunately, the Obama Administration has put a fly in the ointment by announcing the indefinite suspension of negotiations while it conducts a review of the trade policy it inherited from George Bush. This doesn’t mean that the deal is off, just that it’s on hold for the meantime, much to the disappointment of both National and Labour.
It is important to realise that these agreements, both current and those under negotiation, are not just about trade. They contain major provisions locking in a heavily tilted playing field for the TNCs. For example, under NZ’s Free Trade Agreement with China any further opening of foreign investment cannot be rolled back by future NZ governments as it applies to Chinese investors without the consent of the Chinese government. Similar provisions apply in the other actual or potential Free Trade Agreements. It is called the National Treatment provision, meaning that companies from the other country must be treated the same as NZ companies, otherwise they can claim that they are being discriminated against and seek legal redress.
And these free trade and foreign investment agreements have major consequences at the local government level, where the TNCs eagerly anticipate fresh rich pickings, in the areas like water, roads and the whole range of local government services. Christchurch used to have a very progressive policy on this. You may remember, from the late 90s, the successful campaign to stop the Multilateral Agreement on Investment (MAI) which was a global attempt to throw open the world’s economies to the TNCs in one king hit. CAFCA was one of the organisations which lobbied the Christchurch City Council to be aware of the serious implications for it should the MAI come into effect. The Council, to its great credit, adopted a policy against the MAI and went further, by deciding to alert other local bodies to it. It unanimously passed a five part resolution not only opposing the MAI but setting out a progressive policy on foreign investment. That resolution was quietly revoked, without any publicity on May 28th, on the grounds that it is “obsolete”. The present Council (which distinguished itself in its previous term by trying to flog off the Lyttelton Port Company to a Hong Kong TNC) is undoing all the good work that its predecessors have done on this issue, work which deservedly gave Christchurch the national reputation as having the most progressive local government in the country. The Council, within the past decade, also adopted resolutions opposing specific Free Trade Agreements such as that proposed with Hong Kong (which has just been revived this year). Will they also now be quietly shelved as “obsolete”?
Who is driving this whole agenda? Obviously the ideologues in both National and Act (the latter is very much the tail wagging the dog), plus their allies in Labour. Treasury, which was sidelined to some degree under Labour, is back in the driving seat – its officials are conducting the review of the Overseas Investment Act. Treasury makes no secret that it supports no legal differentiation between foreign and NZ companies and that is what it recommended to the Labour government the last time the Act was reviewed – Labour was not prepared to go that far, because of opposition from within its own caucus and from its own voters. As we have recently seen, the Organisation for Economic Cooperation and Development (OECD, the rich countries’ club of which NZ is a member) has issued a diktat to NZ urging, among many other things, wholesale privatisation, State asset sales, slashing public services and liberalising the foreign investment law. This is richly ironic coming from the mouthpiece of the richest capitalist economies which are themselves doing just the opposite, namely drastically increasing the role of the State (or, at least, taxpayers’ money) in the failed private sector. Obviously the OECD ideologues are as hopelessly out of touch with reality as their NZ counterparts.
The agenda is also being driven by interested parties such as major NZ law firm Chapman Tripp, which makes a nice living out of acting for foreign investors. It called for a major review of the Act to sort out what it calls the “muddle”. The Government’s terms of reference for the review bear a strong resemblance to Chapman Tripp’s recommendations. Property Council NZ, which represents big time developers and lawyers who act for foreign land buyers, is happy to declare that it started lobbying the new Government as soon as it came to power. It has set up what it calls a Technical Reference Group to assist the Government’s review. And it is driven by foreign investors themselves, such as a gentleman called Farhad Vladi who buys and sells islands around the world (including in NZ) for his super rich clients. He told the media recently that the current law is unfair to, and too tough on, foreign investors. And finally it is driven by the transnational corporate media which campaigned tirelessly to get National back into power and which all too often parrots the party line that “NZ needs to further open up our economy”.
The consequences of all this for ordinary New Zealanders are pretty self evident. I used to be a “real” worker myself, so I’ll speak about where I used to work, namely the Railways. I was made redundant in 1991, just before the former Employment Contracts Act came into force. But I was there, indeed I was a union official, right through the period of “rationalising, restructuring and corporatisation”, all of which led to massive unemployment (including myself). That Act, which was part of the last National government’s drive to “make NZ attractive to foreign investors”, slashed pay and eliminated conditions for all NZ workers and disempowered the great majority of them by deunionising them. The disastrous privatisation of the Railways that followed in 1993, lasting until 2008, led to further mass unemployment and in the case of the criminally negligent TranzRail, deaths and injuries to both its workers and the public. There are very good reasons why TranzRail won three of the first six Roger Awards for the Worst Transnational Corporation Operating in Aotearoa/New Zealand. It was a text book example of what happens when a State asset is privatised. Telecom is the other big one, but there are plenty more. A policy of untrammelled foreign investment, free trade and privatisation is extremely bad for ordinary people, for workers, the working poor and beneficiaries because that policy is a major contributor to what is known as the race to the bottom, to the lowest common denominator.
And finally, we need to dispel some of the pernicious myths peddled by these cultists about foreign “investment” as the One True Path to the Promised Land.
It doesn’t bring in “much needed money”. Quite the opposite, it sucks money out of the country. In the decade 1997-2006 transnational corporations made $50 billion profits in NZ. Only 32% of that was reinvested here; meaning that 2/3 of that enormous sum left the country. That is itself is a major cause of NZ’s Current Account Deficit (the Balance of Payments) being so high.
It doesn’t provide “much needed jobs”. Foreign companies only employ 19% of the NZ workforce, despite owning a disproportionately large chunk of the economy. 81% work for NZ employers. And those very same foreign companies significantly add to the unemployment total, having made tens of thousands of NZ workers jobless in the decades in which we’ve had a “liberalised” foreign investment regime.
It does nothing to improve NZ’s foreign debt problem. This is one area highlighted by the OECD report and it is nonsense. In 1984, when Rogernomics started, NZ’s gross total private and public foreign debt was $16 billion. By December 2008, it was $248 billion, the vast majority of that held by the corporate sector, not the Government, and totaling 137% of gross domestic product (GDP). So, despite all those numerous State asset sales, the foreign debt has just kept on soaring.
Continuing to follow these discredited policies is a recipe for disaster, even on capitalist terms. They lead only to a dead end and in the process it will be ordinary New Zealanders who will get badly hurt. It is what has happened in the past, it is happening now and blind adherence to this mumbo jumbo will only make it worse.
You don’t need me to tell you that the world is in a once in a century economic crisis right now. As capitalism (which is usually misleadingly labelled as “democracy”) was declared the winner of the nearly 50 year long Cold War, and capitalist triumphalism was the dominant theme of the past two decades, along with American unilateralism, this means that what we are experiencing is a genuine, full blown crisis of capitalism. I should say at the outset that, unfortunately, I do not share the view that this means “the death of capitalism”. It has survived and mutated into new forms throughout all its previous great and small crises, including the 1930s’ Depression, which is the only precedent for what we’re experiencing now. It won’t die unless something kills it. As my old mate Chairman Mao said: “If you don’t hit it, it won’t fall”. But that’s a whole different subject from what we’re discussing today. I do hope, for all our sakes, that this crisis does not mutate into fascism and world war as the last one did (but there are worrying signs in some particularly stressed parts of the world).
The consensus seems to be that the full force of the tsunami hasn’t yet reached our distant shores and the worst is still to come, that NZ is maybe 12 months behind the rest of the world. It is easy to deny that what has happened in the much bigger and quite different economies of, say, the US and Britain, won’t be replicated here. After all, our banks did not get into the outright criminality of subprime mortgages, nor do we have crippling imperialist wars to finance, such as those in Iraq and Afghanistan. So, it is instructive to consider what has happened to a comparable country, namely Ireland, once known as the Celtic Tiger. Ireland has a similar size population, used to rely on agriculture as its mainstay, has always exported people as we do (except on a considerably greater scale), and had systemic high unemployment. The cure for all of this was supposed to be foreign investment, with all sorts of inducements offered to the transnational corporations (TNCs), particularly those in the manufacturing end of the high tech electronic industry, to get them to set up shop. For a while there things were rosy indeed and the country boomed, particularly the housing market (does that sound familiar?). Ireland was regularly cited as a model for NZ, an example of a country that had moved to a “new, smart” economy. But now the TNCs like computer giant Dell are quitting Ireland for cheaper labour locations such as Poland.
To quote Time (6/4/09): “The good times owed much to the arrival of foreign-owned companies like Dell – such firms account for almost 90% of Irish exports and more than two thirds of the country’s business research and development – so the scaling down of a flagship investor is a real blow. It’s not the only one. After more than a decade of rampant growth, Ireland now looks anaemic. A burst property bubble has landed the country in a deep recession. The economy could shrink as much as 6.5% this year, with unemployment set to reach 12%. Irish banks – massively exposed to property – look wobbly, and as tax receipts dwindle, public finances are in a mess”. The parallel is not exact, of course – foreign investors in NZ have tended not to actually set up very much by way of manufacturing plants here, and NZ manufacturers have headed for the cheaper labour of anywhere from Fiji to China to Mexico and Thailand (in the case of Fisher and Paykel) in the past two decades. So NZ manufacturing was already buggered before this latest crisis came along. But there is enough commonality there to sound a very loud warning to NZ. If you put all your eggs in the basket marked “foreign investment”, prepare to be left with just a mess of broken eggs.
What the major capitalist countries are doing is throwing unimaginably huge sums of money at the problem in an attempt to “save capitalism” (or, at least, to save the skins of their respective ruling classes who got them into the mess in the first place). Some more excitable commentators have described this as socialism. No such luck, it is simply State capitalism on an enormous scale. But, whatever it is called, it represents a fundamentally different species of capitalism to the completely laissez faire variety that has been globally running amok for the past 30 odd years. The more perceptive of the capitalist leaders have recognised that things can not simply proceed as they did before, or else this whole scenario will be repeated. In short, something has to change.
I should stress that this is not the consensus view by any means – for many of the “masters of the universe” currently down on their luck, all that they want is the American or European or whichever taxpayers to dig them out of the hole they have dug themselves into, so that they can go straight back to doing things exactly how they were doing them before. In other words, they want to exactly repeat the behaviour which brought about this whole mess in the first place. The closest analogy is of a drug addict begging his family to give him the means to buy more drugs so that he can carry on with his destructive addiction. The jury is still very much out on whether these mind boggling bailouts in the US and elsewhere will actually “save capitalism” or just briefly prolong the lifespan of the dominant, extremely dysfunctional version of it, namely finance capital.
But nothing has changed as far as good old New Zealand is concerned. I’ve already said that there is a tsunami coming but our Government is running full tilt towards it, transfixed by the big, shiny wave. While the rest of the capitalist world is now full of born again Keynesians (and Marx is being studied again as the most insightful critic of capitalism). But National and Act, and their strangely silent Maori Party partner, are still living in the recent past, where the patron saints were Adam Smith, Friedrich von Hayek and Milton Friedman, not to mention Roger Douglas. They are behaving as if nothing has happened or, even worse, that nothing is going to happen.
Bill English’s first Budget did not repeat Ruth Richardson’s monumental 1991 blunder of bashing the poor and slashing benefits (which have never recovered the lost ground) but it also didn’t do anything much to prepare the country for the turbulence ahead. I don’t care about the tax cuts being scrapped, I congratulate National for doing so. But by stopping the Government’s annual contribution to the Super Fund for ten years sends a clear message that universal old age pensions will be under serious threat in the not too distant future. English said that there is no point investing taxpayers’ money into the bottomless pit that currently constitutes the global markets. Correct, so why not do what should have done in the first place when Michael Cullen set up that Fund and invest it into NZ instead. There is no shortage of infrastructure, health and education projects that could be built or improved with a decent infusion of cash. I’m a cyclist but I really don’t see the building of a national cycleway as the Government’s top priority in its economic stimulus package. Come on, boys, you can do better than that.
A distinguishing characteristic of this denial of reality is the Government’s continued fixation on foreign “investment” as the answer to all questions. It got elected as “Labour Lite” (actually Labour was pretty much “Labour Lite” in the first place) but has decided that the already considerably liberalised Overseas Investment Act, which came into force only as recently as 2005 (Michael Cullen’s legacy) is “too tough” on the poor old TNCs and needs to be eased up even further. Bill English has announced a review of the Act, to be completed by the end of June, with new legislation ready by later this year. As the review has not yet been completed, we don’t know the details, but from what we’ve seen of the review’s terms of reference, you can bet dollars to doughnuts that it will call for the door to be thrown wide open or, even better, ripped off the hinges. Tories are fond of calling for “locking them up and throwing away the key” in relation to crime; in the case of foreign investment, they call for unlocking the door and throwing away the key so that it can’t be locked again. I see this obsession with foreign investment (what they like to call “an open economy”) as being like a cargo cult, with the Government of the day (and it is a bipartisan obsession, with Labour equally as guilty) frantically cutting landing strips in the jungle and awaiting the arrival of the big shiny planes that will come out of the sky and bring all the cargo that will solve all our problems.
Two other broken down old nags make up this trifecta of losers – privatisation and “free trade”. New Zealand is a heavy backer of both. Privatisation is a very touchy subject for Tory strategists because the New Zealand people have had so much negative experience of it, and don’t want any more of it. It was given free rein here in the 80s and 90s and was a bloody disaster. Key got elected by promising not to privatise any State assets during his first term, including the likes of Kiwi Rail which was only renationalised by Labour in its last few months in power. This election promise is one which will stick in the throat of the National and Act ideologues and they will be working overtime to think up ways to privatise things without actually calling it privatisation. Hence the talk of “opening up ACC to competition” (which will come from the global insurance TNCs – the mates of AIG, the US insurance giant which has come to personify everything that is wrong with the global financial sector) rather than baldly announcing that ACC is to be flogged off. Hence the death by a thousand cuts of TVNZ. To give just the most recent example – if you want to watch the 2011 Rugby World Cup in its entirety, you’ll need to pay for Sky TV, it won’t all be on free to air. So, TVNZ loses more and more of the prizes and its demise becomes a self-fulfilling prophecy as viewers feel compelled to switch to Sky. Then the Government will be able to self righteously wring its hands and say that it has no alternative but to sell TVNZ, for a bargain price. Hence the new fashion of Public Private Partnerships in sectors such as roads and other infrastructure, with these PPPs (first championed by Labour) being seen as a more acceptable alternative to outright privatisation, with the added benefit for the TNCs that they don’t have to shoulder all the cost and the risk. Hence the sudden push for private prisons to be allowed back as a “solution” to the problem of soaring rates of imprisonment (and isn’t that making a big difference to the crime rate? But that’s another story).
“Free” trade is an absolute item of faith for both National and Labour, who use it to look at the world down the wrong end of the telescope. Jane Kelsey has described the bipartisan approach as being “what is good for Fonterra is good for New Zealand”, meaning there is an absolute obsession with opening up global markets for NZ agricultural products, with no concern whatsoever for the disastrous impacts of the reciprocal opening of the NZ economy (nor for the truly catastrophic effects that “free” trade has on the poor countries who comprise the majority of the world’s people – but that’s a separate subject). New Zealand, who gifted Mike Moore to the world as one of its Directors General, has been monomaniacal in its drive to get the Doha Round of the World Trade Organisation wrapped up. But, despite our best efforts, the talks are hopelessly stalled. Why? Because other countries, including the very biggest capitalist ones, are not as keen as us to jump off the cliff, trusting only in “the market” to ensure a safe landing. All of those other countries quite unashamedly have their own national interests to be protected. And that has only become more apparent as both the US and European countries have reaffirmed their support for subsidies for their farmers, leaving NZ out on a limb impotently hissing furiously about how could they do this to us, we had jumped over the cliff of free trade on the promise that our erstwhile friends would jump over with us and surprise, surprise, they’re still on the cliff top waving us goodbye and asking us if it hurts yet. What’s that old saying about look before you leap?
Both National and Labour governments have worked tirelessly to sign NZ up to free trade agreements, any free trade agreements. If the multilateral WTO talks are bogged down, then NZ hares off after other regional or bilateral agreements with anyone who will have us. It’s worth listing what trade agreements NZ is already in:
Closer Economic Relations with Australia;
multilateral agreements with the Association of South East Asian Nations; the Pacific Agreement on Closer Economic Relations (with various Pacific countries); the Pacific Four (P4) Agreement with Singapore, Chile and Brunei;
bilateral Free Trade Agreements with China, Singapore and Thailand;
and bilateral investment agreements with Hong Kong and China.
In addition, the following Free Trade Agreements are currently under negotiation by the NZ government:
An expanded P4, now called the Transpacific, involving the US, Singapore, Brunei, Chile, Australia, Peru and perhaps Vietnam and others;
South Korea;
Hong Kong;
Gulf States;
and India.
New Zealand is nothing if not persistent. The proposed Hong Kong Free Trade Agreement stalled in 2002, under Labour, and the restart of negotiations was only announced this year. Of those currently under negotiation the most important is the Transpacific, because its announcement in the final few months of the Labour government was heralded as the means to secure the Holy Grail of a Free Trade Agreement with the US. Fortunately, the Obama Administration has put a fly in the ointment by announcing the indefinite suspension of negotiations while it conducts a review of the trade policy it inherited from George Bush. This doesn’t mean that the deal is off, just that it’s on hold for the meantime, much to the disappointment of both National and Labour.
It is important to realise that these agreements, both current and those under negotiation, are not just about trade. They contain major provisions locking in a heavily tilted playing field for the TNCs. For example, under NZ’s Free Trade Agreement with China any further opening of foreign investment cannot be rolled back by future NZ governments as it applies to Chinese investors without the consent of the Chinese government. Similar provisions apply in the other actual or potential Free Trade Agreements. It is called the National Treatment provision, meaning that companies from the other country must be treated the same as NZ companies, otherwise they can claim that they are being discriminated against and seek legal redress.
And these free trade and foreign investment agreements have major consequences at the local government level, where the TNCs eagerly anticipate fresh rich pickings, in the areas like water, roads and the whole range of local government services. Christchurch used to have a very progressive policy on this. You may remember, from the late 90s, the successful campaign to stop the Multilateral Agreement on Investment (MAI) which was a global attempt to throw open the world’s economies to the TNCs in one king hit. CAFCA was one of the organisations which lobbied the Christchurch City Council to be aware of the serious implications for it should the MAI come into effect. The Council, to its great credit, adopted a policy against the MAI and went further, by deciding to alert other local bodies to it. It unanimously passed a five part resolution not only opposing the MAI but setting out a progressive policy on foreign investment. That resolution was quietly revoked, without any publicity on May 28th, on the grounds that it is “obsolete”. The present Council (which distinguished itself in its previous term by trying to flog off the Lyttelton Port Company to a Hong Kong TNC) is undoing all the good work that its predecessors have done on this issue, work which deservedly gave Christchurch the national reputation as having the most progressive local government in the country. The Council, within the past decade, also adopted resolutions opposing specific Free Trade Agreements such as that proposed with Hong Kong (which has just been revived this year). Will they also now be quietly shelved as “obsolete”?
Who is driving this whole agenda? Obviously the ideologues in both National and Act (the latter is very much the tail wagging the dog), plus their allies in Labour. Treasury, which was sidelined to some degree under Labour, is back in the driving seat – its officials are conducting the review of the Overseas Investment Act. Treasury makes no secret that it supports no legal differentiation between foreign and NZ companies and that is what it recommended to the Labour government the last time the Act was reviewed – Labour was not prepared to go that far, because of opposition from within its own caucus and from its own voters. As we have recently seen, the Organisation for Economic Cooperation and Development (OECD, the rich countries’ club of which NZ is a member) has issued a diktat to NZ urging, among many other things, wholesale privatisation, State asset sales, slashing public services and liberalising the foreign investment law. This is richly ironic coming from the mouthpiece of the richest capitalist economies which are themselves doing just the opposite, namely drastically increasing the role of the State (or, at least, taxpayers’ money) in the failed private sector. Obviously the OECD ideologues are as hopelessly out of touch with reality as their NZ counterparts.
The agenda is also being driven by interested parties such as major NZ law firm Chapman Tripp, which makes a nice living out of acting for foreign investors. It called for a major review of the Act to sort out what it calls the “muddle”. The Government’s terms of reference for the review bear a strong resemblance to Chapman Tripp’s recommendations. Property Council NZ, which represents big time developers and lawyers who act for foreign land buyers, is happy to declare that it started lobbying the new Government as soon as it came to power. It has set up what it calls a Technical Reference Group to assist the Government’s review. And it is driven by foreign investors themselves, such as a gentleman called Farhad Vladi who buys and sells islands around the world (including in NZ) for his super rich clients. He told the media recently that the current law is unfair to, and too tough on, foreign investors. And finally it is driven by the transnational corporate media which campaigned tirelessly to get National back into power and which all too often parrots the party line that “NZ needs to further open up our economy”.
The consequences of all this for ordinary New Zealanders are pretty self evident. I used to be a “real” worker myself, so I’ll speak about where I used to work, namely the Railways. I was made redundant in 1991, just before the former Employment Contracts Act came into force. But I was there, indeed I was a union official, right through the period of “rationalising, restructuring and corporatisation”, all of which led to massive unemployment (including myself). That Act, which was part of the last National government’s drive to “make NZ attractive to foreign investors”, slashed pay and eliminated conditions for all NZ workers and disempowered the great majority of them by deunionising them. The disastrous privatisation of the Railways that followed in 1993, lasting until 2008, led to further mass unemployment and in the case of the criminally negligent TranzRail, deaths and injuries to both its workers and the public. There are very good reasons why TranzRail won three of the first six Roger Awards for the Worst Transnational Corporation Operating in Aotearoa/New Zealand. It was a text book example of what happens when a State asset is privatised. Telecom is the other big one, but there are plenty more. A policy of untrammelled foreign investment, free trade and privatisation is extremely bad for ordinary people, for workers, the working poor and beneficiaries because that policy is a major contributor to what is known as the race to the bottom, to the lowest common denominator.
And finally, we need to dispel some of the pernicious myths peddled by these cultists about foreign “investment” as the One True Path to the Promised Land.
It doesn’t bring in “much needed money”. Quite the opposite, it sucks money out of the country. In the decade 1997-2006 transnational corporations made $50 billion profits in NZ. Only 32% of that was reinvested here; meaning that 2/3 of that enormous sum left the country. That is itself is a major cause of NZ’s Current Account Deficit (the Balance of Payments) being so high.
It doesn’t provide “much needed jobs”. Foreign companies only employ 19% of the NZ workforce, despite owning a disproportionately large chunk of the economy. 81% work for NZ employers. And those very same foreign companies significantly add to the unemployment total, having made tens of thousands of NZ workers jobless in the decades in which we’ve had a “liberalised” foreign investment regime.
It does nothing to improve NZ’s foreign debt problem. This is one area highlighted by the OECD report and it is nonsense. In 1984, when Rogernomics started, NZ’s gross total private and public foreign debt was $16 billion. By December 2008, it was $248 billion, the vast majority of that held by the corporate sector, not the Government, and totaling 137% of gross domestic product (GDP). So, despite all those numerous State asset sales, the foreign debt has just kept on soaring.
Continuing to follow these discredited policies is a recipe for disaster, even on capitalist terms. They lead only to a dead end and in the process it will be ordinary New Zealanders who will get badly hurt. It is what has happened in the past, it is happening now and blind adherence to this mumbo jumbo will only make it worse.
CITY COUNCIL QUIETLY SCRAPS ITS PROGRESSIVE POLICY ON FOREIGN INVESTMENT AS “OBSOLETE”
Not so many years ago, when the Christchurch City Council was proud of the title “The People’s Republic of Christchurch”, it adopted a number of progressive resolutions and policies on foreign investment and free trade agreements.
In the late 90s, there was a successful international campaign to stop the Multilateral Agreement on Investment (MAI) which was a global attempt to throw open the world’s economies to the transnational corporations in one king hit. The Campaign Against Foreign Control of Aotearoa (CAFCA) was one of the organisations which lobbied the Christchurch City Council to be aware of the serious implications for it should the MAI come into effect. The Council, to its great credit, adopted a policy against the MAI and went further, by deciding to alert other local bodies to it. It unanimously passed a five part resolution not only opposing the MAI but setting out a progressive policy on foreign investment.
That resolution was quietly revoked, without any publicity on May 28th, on the grounds that it is “obsolete”.
In part the resolution said: “That the Christchurch City Council reaffirms a commitment to the encouragement of controlled and managed foreign investment in the city that is consistent with broader local government social, environmental and economic development policies” and: “That a watching brief be kept on the implications of the effects of the MAI or similar projects in NZ and Christchurch City”.
What is “obsolete” about any of that? It sounds pretty current and necessary to CAFCA.
It was passed unanimously, meaning that all shades of political opinion represented on the Council at that time agreed with it.
The Council (which distinguished itself in its previous term by trying to flog off the Lyttelton Port Company to a Hong Kong transnational) is undoing all the good work that its predecessors have done on this issue, work which deservedly gave Christchurch the national reputation as having the most progressive local government in the country. The Council, within the past decade, also adopted resolutions opposing specific Free Trade Agreements such as that proposed with Hong Kong (negotiations on this proposed Agreement have just been revived this year).
Will they also now be quietly shelved as “obsolete”?
These free trade and foreign investment agreements have major consequences at the local government level, where the transnationals eagerly anticipate rich pickings, in the areas like water, roads and the whole range of local government services.
Is the Council laying the ground for a sell off of public assets under the guise of revoking “obsolete” policies? The people of Christchurch are entitled to an answer from our elected representatives.
In the late 90s, there was a successful international campaign to stop the Multilateral Agreement on Investment (MAI) which was a global attempt to throw open the world’s economies to the transnational corporations in one king hit. The Campaign Against Foreign Control of Aotearoa (CAFCA) was one of the organisations which lobbied the Christchurch City Council to be aware of the serious implications for it should the MAI come into effect. The Council, to its great credit, adopted a policy against the MAI and went further, by deciding to alert other local bodies to it. It unanimously passed a five part resolution not only opposing the MAI but setting out a progressive policy on foreign investment.
That resolution was quietly revoked, without any publicity on May 28th, on the grounds that it is “obsolete”.
In part the resolution said: “That the Christchurch City Council reaffirms a commitment to the encouragement of controlled and managed foreign investment in the city that is consistent with broader local government social, environmental and economic development policies” and: “That a watching brief be kept on the implications of the effects of the MAI or similar projects in NZ and Christchurch City”.
What is “obsolete” about any of that? It sounds pretty current and necessary to CAFCA.
It was passed unanimously, meaning that all shades of political opinion represented on the Council at that time agreed with it.
The Council (which distinguished itself in its previous term by trying to flog off the Lyttelton Port Company to a Hong Kong transnational) is undoing all the good work that its predecessors have done on this issue, work which deservedly gave Christchurch the national reputation as having the most progressive local government in the country. The Council, within the past decade, also adopted resolutions opposing specific Free Trade Agreements such as that proposed with Hong Kong (negotiations on this proposed Agreement have just been revived this year).
Will they also now be quietly shelved as “obsolete”?
These free trade and foreign investment agreements have major consequences at the local government level, where the transnationals eagerly anticipate rich pickings, in the areas like water, roads and the whole range of local government services.
Is the Council laying the ground for a sell off of public assets under the guise of revoking “obsolete” policies? The people of Christchurch are entitled to an answer from our elected representatives.
Property: Corporate advisers steer overseas investment review
The National Business Review 2009 - 22 May 2009
Applications to be sped up and red tape cut under professionals' review
Chris Hutching
The Property Council is predicting big changes for the Overseas Investment Act when the cabinet reviews the legislation next month.
The council has championed the overhaul of the act as a priority and briefed Land Information Minister Richard Worth.
The main thrust will be to reduce the threshold where screening of a deal is required, particularly when involving the definition of "sensitive" and "special" land, which will require legislation to change. The other main reforms, which will not require legislation, will be to immediately ensure that more applications are decided by the Overseas Investment Office, rather than ministers. This will mean applications are turned around more swiftly, according to the Property Council.
A technical reference group has been appointed to assist the review. The appointees are; Andrew Petersen of Bell Gully in Auckland, Don Holborow of Simpson Grierson in Wellington, Garth Sinclair of Russell McVeagh in Auckland, Tim Williams of Chapman Tripp in Auckland, and Andrew Monteith a partner at Minter Ellison Rudd Watts in Auckland.
All of the professionals in the reference group have experience in acquisitions and takeovers involving leading multinational corporate players.
One of Mr Williams' colleagues has published his views on the required changes in a publication available on his company's website. He claims that the definition of sensitive land often captures trivial and unexpected transactions; "for example where there is a tidal creek or murky stream at the back of a factory site or a commercial property adjoins a small park or a small access reserve."
But long time anti-foreign investment lobbyist Murray Horton of the Campaign Against Foreign Control in Aotearoa, described the team as a "patsy set up."
Applications to be sped up and red tape cut under professionals' review
Chris Hutching
The Property Council is predicting big changes for the Overseas Investment Act when the cabinet reviews the legislation next month.
The council has championed the overhaul of the act as a priority and briefed Land Information Minister Richard Worth.
The main thrust will be to reduce the threshold where screening of a deal is required, particularly when involving the definition of "sensitive" and "special" land, which will require legislation to change. The other main reforms, which will not require legislation, will be to immediately ensure that more applications are decided by the Overseas Investment Office, rather than ministers. This will mean applications are turned around more swiftly, according to the Property Council.
A technical reference group has been appointed to assist the review. The appointees are; Andrew Petersen of Bell Gully in Auckland, Don Holborow of Simpson Grierson in Wellington, Garth Sinclair of Russell McVeagh in Auckland, Tim Williams of Chapman Tripp in Auckland, and Andrew Monteith a partner at Minter Ellison Rudd Watts in Auckland.
All of the professionals in the reference group have experience in acquisitions and takeovers involving leading multinational corporate players.
One of Mr Williams' colleagues has published his views on the required changes in a publication available on his company's website. He claims that the definition of sensitive land often captures trivial and unexpected transactions; "for example where there is a tidal creek or murky stream at the back of a factory site or a commercial property adjoins a small park or a small access reserve."
But long time anti-foreign investment lobbyist Murray Horton of the Campaign Against Foreign Control in Aotearoa, described the team as a "patsy set up."
COMMITTEE TASKED WITH “OVERSIGHT” OF SPIES REFUSES TO DIVULGE EVEN THE MOST TRIVIAL DETAILS OF ITS MEETINGS
The Anti-Bases Campaign (ABC), which has been campaigning for over 20 years for the closure of the Waihopai spybase, has a keen interest in the alleged ”oversight” of the agency which operates it, namely the NZ Government Communications Security Bureau (GCSB).
One of the few methods of official oversight of the GCSB (and the SIS) is the Intelligence and Security Committee, which is a committee of Government, not Parliament, and is definitely not a Select Committee. It only has five members – the Prime Minister, Leader of the Opposition and three other Party Leaders nominated by either of those two. The other three are: Rodney Hide, Tariana Turia and Russel Norman.
The actual proceedings of the Committee (which only ever meets a couple of times per year) are shrouded in permanent secrecy.
But we thought that the mere facts of its meetings – when it had met, for how long and who attended – should be public knowledge. So we wrote to the Office of the Prime Minister (as the Minister in Charge of the GCSB and SIS), under the Official Information Act, asking for those innocuous details.
The answer we got is that the Committee is not subject to the Official Information Act, as it is neither a “department” nor an “organisation” as defined in the Act. So our request was declined.
This is absurd, rendering any public knowledge of what little “oversight” there is of the spies to be non-existent. How can it possibly threaten the national security for it to be publicly stated when the Committee has met; how long the meeting lasted, and who attended it? That is the sum total of what we asked – not what the Committee actually discussed or decided. We’ve always said that the “oversight” is a farce – this proves it.
One of the few methods of official oversight of the GCSB (and the SIS) is the Intelligence and Security Committee, which is a committee of Government, not Parliament, and is definitely not a Select Committee. It only has five members – the Prime Minister, Leader of the Opposition and three other Party Leaders nominated by either of those two. The other three are: Rodney Hide, Tariana Turia and Russel Norman.
The actual proceedings of the Committee (which only ever meets a couple of times per year) are shrouded in permanent secrecy.
But we thought that the mere facts of its meetings – when it had met, for how long and who attended – should be public knowledge. So we wrote to the Office of the Prime Minister (as the Minister in Charge of the GCSB and SIS), under the Official Information Act, asking for those innocuous details.
The answer we got is that the Committee is not subject to the Official Information Act, as it is neither a “department” nor an “organisation” as defined in the Act. So our request was declined.
This is absurd, rendering any public knowledge of what little “oversight” there is of the spies to be non-existent. How can it possibly threaten the national security for it to be publicly stated when the Committee has met; how long the meeting lasted, and who attended it? That is the sum total of what we asked – not what the Committee actually discussed or decided. We’ve always said that the “oversight” is a farce – this proves it.
LEADING KIWIS SAY NO TO LIBERALISING OVERSEAS INVESTMENT ACT & TO FREE TRADE AGREEMENT WITH US
Thursday’s Budget promises to be a humdinger, maybe in the finest traditions of Ruth Richardson’s infamous “bash the poor” 1991 one. But you can bet that there will be two hoary old myths peddled as a means to get NZ out of our particular corner of the global economic crisis – we’ll be told that the economy needs to be opened up even more to foreign investors, by means of liberalising, yet again, the Overseas Investment Act; and that a Free Trade Agreement with the US is the Holy Grail of the numerous trade deals that the Government is currently pursuing.
The Campaign Against Foreign Control of Aotearoa (CAFCA) says “no” to both and we are not alone. We have asked organisations and well known New Zealanders to endorse our opposition to both proposals. Below is the list of the first to do so. More will be added as they come to hand. We invite others who wish to join the list of endorsers to contact us.
For full details of the proposed liberalisation of the Overseas Investment Act, go to http://canterbury.cyberplace.co.nz/community/CAFCA/OIReview/OIReview2009.html on the CAFCA Website (address below).
And for full details of the proposed US/NZ Free Trade Agreement and the campaign against it, go to the New Zealand Not For Sale Campaign Website at http://www.nznotforsale.org/
Please regularly check both those Websites for updates, additional signatories, etc.
Unite Union
Matt McCarten, General Secretary, Unite Union
Mike Treen, National Director, Unite Union
Bill Willmott, Emeritus Professor
Dr Robin Gwynn
Reverend Brian Turner, Past President, Methodist Church of NZ
Jeanette Fitzsimons, Green Party Co-Leader, on behalf of the Party
Frances Mountier
Kay Murray, Alliance Party Co-Leader
Prue Hyman, Adjunct professor of Gender and Women's Studies, Victoria University of Wellington
Maire Leadbeater
Matt McCarten, on behalf of Unite Union
Joe Davies, organiser, Unite Union
Simon Oosterman, organiser, National Distribution Union
Paul Corliss
Dion Martin, organiser, National Distribution Union
Trevor Hanson, General Secretary, Maritime Union of NZ, on behalf of the union
Councillor Paul Bruce, Greater Wellington Regional Council
Andrew Campbell
Dr Jane Kelsey
Catherine Delahunty, Green MP
Dr Sue Newberry
Dr Bill Rosenberg
The Campaign Against Foreign Control of Aotearoa (CAFCA) says “no” to both and we are not alone. We have asked organisations and well known New Zealanders to endorse our opposition to both proposals. Below is the list of the first to do so. More will be added as they come to hand. We invite others who wish to join the list of endorsers to contact us.
For full details of the proposed liberalisation of the Overseas Investment Act, go to http://canterbury.cyberplace.co.nz/community/CAFCA/OIReview/OIReview2009.html on the CAFCA Website (address below).
And for full details of the proposed US/NZ Free Trade Agreement and the campaign against it, go to the New Zealand Not For Sale Campaign Website at http://www.nznotforsale.org/
Please regularly check both those Websites for updates, additional signatories, etc.
Unite Union
Matt McCarten, General Secretary, Unite Union
Mike Treen, National Director, Unite Union
Bill Willmott, Emeritus Professor
Dr Robin Gwynn
Reverend Brian Turner, Past President, Methodist Church of NZ
Jeanette Fitzsimons, Green Party Co-Leader, on behalf of the Party
Frances Mountier
Kay Murray, Alliance Party Co-Leader
Prue Hyman, Adjunct professor of Gender and Women's Studies, Victoria University of Wellington
Maire Leadbeater
Matt McCarten, on behalf of Unite Union
Joe Davies, organiser, Unite Union
Simon Oosterman, organiser, National Distribution Union
Paul Corliss
Dion Martin, organiser, National Distribution Union
Trevor Hanson, General Secretary, Maritime Union of NZ, on behalf of the union
Councillor Paul Bruce, Greater Wellington Regional Council
Andrew Campbell
Dr Jane Kelsey
Catherine Delahunty, Green MP
Dr Sue Newberry
Dr Bill Rosenberg
RIP Ray Scott - CAFCA member and former committee member Ray Scott
Ray Scott, who died at the weekend, aged 79, was a CAFCA committee member from 1998-2002 and in that period played a full part in the whole spectrum of CAFCA activities. Ray had a great sense of humour, that innate Irish wit, which made him good fun at meetings and mailouts, etc.
We only ever knew Ray in a wholly secular context but he had previously been a Catholic priest for decades. He was part of that great wave of men who quit the priesthood and got married. By the time he joined us the marriage had ended. We knew him as a superannuitant (he joined CAFCA in his late 60s) who was very active in the Alliance.
Ray came from a Temuka farming family and went from home into the seminary, going on to become a parish priest in various parishes and also a teacher, including in one of the most remote corners of the Marlborough Sounds. He lived most of his life in Canterbury, specifically Christchurch, although as a married man in the early 90s, he also lived in Whangarei.
Ray was actually the second current or former priest to serve on the CAFCA committee (first time around we used to hold meetings in the presbytery, complete with a housekeeper who made us supper. Every time I watch “Father Ted” I remember that). Ray was on the committee at the same time as the late Reg Duder, who was a devout Anglican of the same vintage, so they made a couple of hard case old bookends to the rest of us heathens.
Ray never gave up Catholicism and was very active for years in the Christchurch Catholic Worker movement, running a weekly Scripture discussion group called Ray’s Ramblings. And after he left us he did something very unusual among those who had quit the priesthood – he went back to it, in his 70s. He concluded that the Church was his family and home. His last parish was in Napier, but he was brought back to Christchurch to die (of cancer).
His memorial meeting was held today in my neighbourhood Catholic church (the first time I’ve ever been to anything there, in my 27 years of living in Addington). Speaker after speaker spoke of his great spirituality; of his poetry (he’s the only person who’s ever written me a poem for my birthday); of his active commitment to social justice; of his love of life and specifically of golf and rugby (he died on the stroke of the Eden Park fulltime siren on Saturday night, having seen the Crusaders safely through to the Super 14 semi-finals).
And several speakers, including family members, spoke of his truly heroic snoring. One Catholic Worker activist brought the house down when he reported how he cured Ray of that, at least temporarily. Condemned to sharing a room with Ray overnight, he got out of bed, kissed Ray goodnight smack on the lips and had a sound night’s sleep, while Ray stayed awake all night. If only I’d known of that handy tip before I spent two sleepless nights with Ray when we went to Blackball for May Day 2000!
See you later Ray (but only if you’re right and I’m wrong),
We only ever knew Ray in a wholly secular context but he had previously been a Catholic priest for decades. He was part of that great wave of men who quit the priesthood and got married. By the time he joined us the marriage had ended. We knew him as a superannuitant (he joined CAFCA in his late 60s) who was very active in the Alliance.
Ray came from a Temuka farming family and went from home into the seminary, going on to become a parish priest in various parishes and also a teacher, including in one of the most remote corners of the Marlborough Sounds. He lived most of his life in Canterbury, specifically Christchurch, although as a married man in the early 90s, he also lived in Whangarei.
Ray was actually the second current or former priest to serve on the CAFCA committee (first time around we used to hold meetings in the presbytery, complete with a housekeeper who made us supper. Every time I watch “Father Ted” I remember that). Ray was on the committee at the same time as the late Reg Duder, who was a devout Anglican of the same vintage, so they made a couple of hard case old bookends to the rest of us heathens.
Ray never gave up Catholicism and was very active for years in the Christchurch Catholic Worker movement, running a weekly Scripture discussion group called Ray’s Ramblings. And after he left us he did something very unusual among those who had quit the priesthood – he went back to it, in his 70s. He concluded that the Church was his family and home. His last parish was in Napier, but he was brought back to Christchurch to die (of cancer).
His memorial meeting was held today in my neighbourhood Catholic church (the first time I’ve ever been to anything there, in my 27 years of living in Addington). Speaker after speaker spoke of his great spirituality; of his poetry (he’s the only person who’s ever written me a poem for my birthday); of his active commitment to social justice; of his love of life and specifically of golf and rugby (he died on the stroke of the Eden Park fulltime siren on Saturday night, having seen the Crusaders safely through to the Super 14 semi-finals).
And several speakers, including family members, spoke of his truly heroic snoring. One Catholic Worker activist brought the house down when he reported how he cured Ray of that, at least temporarily. Condemned to sharing a room with Ray overnight, he got out of bed, kissed Ray goodnight smack on the lips and had a sound night’s sleep, while Ray stayed awake all night. If only I’d known of that handy tip before I spent two sleepless nights with Ray when we went to Blackball for May Day 2000!
See you later Ray (but only if you’re right and I’m wrong),
BILL ENGLISH. STOP IMPOTENTLY BEGGING AUSSIE BANKS TO BEHAVE. MAKE THEM DO SO.
First it was Reserve Bank Governor, Alan Bollard, urging the four big Australian-owned banks to play the game, be good chaps, don’t let the side down, and other similar clichés. So now we have the spectacle of the Minister of Finance, Bill English, faced with the politically embarrassing spectacle of those same four banks having piled up $4.5 billion in profits (recession? What recession?), begging them to please pay nice and scale back their flagrant profiteering.
That is likely to meet with the same response – who’s going to make us? It’s time for the Government to pull its finger out and say: “We are”.
NZ taxpayers are now the guarantors of the deposits of the banks. Yet we get no say in their running, let alone ownership. The Australian-owned banks go on their merry way piling up profits as if the crash has never happened, while at the same time turning off credit for their NZ customers, keeping interest rates high, refusing to reimburse mum and dad investors whom they have bilked, laying off staff in their hundreds and outsourcing their jobs to Third World cheap labour. It’s time for the Government to remind the foreign banks of that old saying most favoured by moneymen: “He who pays the piper calls the tune”, and to translate that into action.
The taxpayer needs to be directly represented on the boards of each one of these Aussie banks that we’re underwriting with our money. And, if that doesn’t do the trick, nationalise them. After all, we used to own the BNZ, before it was flogged off to NAB (and PostBank, which was flogged off to ANZ).
Stop begging and start laying down some rules. Less whinging from the sidelines, more big stick.
That is likely to meet with the same response – who’s going to make us? It’s time for the Government to pull its finger out and say: “We are”.
NZ taxpayers are now the guarantors of the deposits of the banks. Yet we get no say in their running, let alone ownership. The Australian-owned banks go on their merry way piling up profits as if the crash has never happened, while at the same time turning off credit for their NZ customers, keeping interest rates high, refusing to reimburse mum and dad investors whom they have bilked, laying off staff in their hundreds and outsourcing their jobs to Third World cheap labour. It’s time for the Government to remind the foreign banks of that old saying most favoured by moneymen: “He who pays the piper calls the tune”, and to translate that into action.
The taxpayer needs to be directly represented on the boards of each one of these Aussie banks that we’re underwriting with our money. And, if that doesn’t do the trick, nationalise them. After all, we used to own the BNZ, before it was flogged off to NAB (and PostBank, which was flogged off to ANZ).
Stop begging and start laying down some rules. Less whinging from the sidelines, more big stick.
ANZ, Give Them Back Their Money
The Campaign Against Foreign Control of Aotearoa (CAFCA) fully supports the Frozen Funds Group in its campaign (which now includes pickets of ANZ branches) to get this Australian–owned bank to repay hapless small NZ investors whose money has been frozen due to the collapse of two investment funds run by its subsidiary ING NZ Ltd.
This was the main reason that ANZ was a finalist in the latest (2008) Roger Award for the Worst Transnational Corporation Operating in Aotearoa/New Zealand. To quote from the Judges’ Report: “The key charge against ANZ-National in 2008 was its reckless promotion to its banking customers of two investment funds run by its subsidiary ING NZ Ltd, which were then frozen, imprisoning $520 million of small investors’ money. The bank ducked responsibility on all fronts – for giving shonky advice, for misrepresenting ING as ‘low risk’, for failing to bail out its subsidiary to avoid the need to freeze funds, and for continuing to collect advisor fees during the freeze. While keeping the funds frozen, ING then announced a profit of $36 million. As a comprehensive case study of the rapacity and unconscionable behaviour at the expense of ordinary investors that have brought the reputation of Wall Street and its local clones to a new low, the ING saga stacks up well. ANZ has also been a central player in the Opus Prime insolvency in Australia, where again small investors were fleeced while the bank initially concealed crucial information and then looked after itself when the crash came. Only after the Banking Ombudsman became involved did ANZ-National begin paying off a few individual victims caught in the ING affair, ‘on a goodwill basis’. ‘Goodwill’ in this context seems to mean good public relations rather than any real relief for the majority of burned investors”.
And CAFCA supports the campaign by Finsec, the bank worker’s union, to keep bank jobs in NZ. This applies to all four of the Australian-owned banks – ANZ, BNZ, Westpac and ASB - but once again ANZ has “distinguished” itself in this field. To quote, again, from the 2008 Roger Award Judges’ Report: “Buttressing the case against ANZ-National was evidence from Finsec that the bank’s management lied to staff and customers when it promised to increase branch staff numbers while outsourcing 500 back office jobs to India; the bank subsequently announced sweeping cuts in branch staffing. Only truly distinguished performances by two other contenders saved ANZ-National from the Roger this time around” (the Roger Award was won by British American Tobacco NZ Ltd, with Rio Tinto Aluminium NZ Ltd as runner-up).
NZ taxpayers are now the guarantors of the deposits of the banks. Yet we get no say in their running, let alone ownership. The Australian-owned banks go on their merry way piling up profits as if the crash has never happened, while at the same time turning off credit for their NZ customers, refusing to reimburse mum and dad investors whom they have bilked, laying off staff in their hundreds and outsourcing their jobs to Third World cheap labour. It’s time for the Government to remind the foreign banks of that old saying most favoured by moneymen: “He who pays the piper calls the tune”, and to translate that into action.
This was the main reason that ANZ was a finalist in the latest (2008) Roger Award for the Worst Transnational Corporation Operating in Aotearoa/New Zealand. To quote from the Judges’ Report: “The key charge against ANZ-National in 2008 was its reckless promotion to its banking customers of two investment funds run by its subsidiary ING NZ Ltd, which were then frozen, imprisoning $520 million of small investors’ money. The bank ducked responsibility on all fronts – for giving shonky advice, for misrepresenting ING as ‘low risk’, for failing to bail out its subsidiary to avoid the need to freeze funds, and for continuing to collect advisor fees during the freeze. While keeping the funds frozen, ING then announced a profit of $36 million. As a comprehensive case study of the rapacity and unconscionable behaviour at the expense of ordinary investors that have brought the reputation of Wall Street and its local clones to a new low, the ING saga stacks up well. ANZ has also been a central player in the Opus Prime insolvency in Australia, where again small investors were fleeced while the bank initially concealed crucial information and then looked after itself when the crash came. Only after the Banking Ombudsman became involved did ANZ-National begin paying off a few individual victims caught in the ING affair, ‘on a goodwill basis’. ‘Goodwill’ in this context seems to mean good public relations rather than any real relief for the majority of burned investors”.
And CAFCA supports the campaign by Finsec, the bank worker’s union, to keep bank jobs in NZ. This applies to all four of the Australian-owned banks – ANZ, BNZ, Westpac and ASB - but once again ANZ has “distinguished” itself in this field. To quote, again, from the 2008 Roger Award Judges’ Report: “Buttressing the case against ANZ-National was evidence from Finsec that the bank’s management lied to staff and customers when it promised to increase branch staff numbers while outsourcing 500 back office jobs to India; the bank subsequently announced sweeping cuts in branch staffing. Only truly distinguished performances by two other contenders saved ANZ-National from the Roger this time around” (the Roger Award was won by British American Tobacco NZ Ltd, with Rio Tinto Aluminium NZ Ltd as runner-up).
NZ taxpayers are now the guarantors of the deposits of the banks. Yet we get no say in their running, let alone ownership. The Australian-owned banks go on their merry way piling up profits as if the crash has never happened, while at the same time turning off credit for their NZ customers, refusing to reimburse mum and dad investors whom they have bilked, laying off staff in their hundreds and outsourcing their jobs to Third World cheap labour. It’s time for the Government to remind the foreign banks of that old saying most favoured by moneymen: “He who pays the piper calls the tune”, and to translate that into action.
CAFCA extends support and solidarity to Frozen Funds Group
ANZ, GIVE THEM BACK THEIR MONEY!
The Campaign Against Foreign Control of Aotearoa (CAFCA) fully supports the Frozen Funds Group in its campaign (which now includes pickets of ANZ branches) to get this Australian–owned bank to repay hapless small NZ investors whose money has been frozen due to the collapse of two investment funds run by its subsidiary ING NZ Ltd.
This was the main reason that ANZ was a finalist in the latest (2008) Roger Award for the Worst Transnational Corporation Operating in Aotearoa/New Zealand. To quote from the Judges’ Report: “The key charge against ANZ-National in 2008 was its reckless promotion to its banking customers of two investment funds run by its subsidiary ING NZ Ltd, which were then frozen, imprisoning $520 million of small investors’ money. The bank ducked responsibility on all fronts – for giving shonky advice, for misrepresenting ING as ‘low risk’, for failing to bail out its subsidiary to avoid the need to freeze funds, and for continuing to collect advisor fees during the freeze. While keeping the funds frozen, ING then announced a profit of $36 million. As a comprehensive case study of the rapacity and unconscionable behaviour at the expense of ordinary investors that have brought the reputation of Wall Street and its local clones to a new low, the ING saga stacks up well. ANZ has also been a central player in the Opus Prime insolvency in Australia, where again small investors were fleeced while the bank initially concealed crucial information and then looked after itself when the crash came. Only after the Banking Ombudsman became involved did ANZ-National begin paying off a few individual victims caught in the ING affair, ‘on a goodwill basis’. ‘Goodwill’ in this context seems to mean good public relations rather than any real relief for the majority of burned investors”.
And CAFCA supports the campaign by Finsec, the bank worker’s union, to keep bank jobs in NZ. This applies to all four of the Australian-owned banks – ANZ, BNZ, Westpac and ASB - but once again ANZ has “distinguished” itself in this field. To quote, again, from the 2008 Roger Award Judges’ Report: “Buttressing the case against ANZ-National was evidence from Finsec that the bank’s management lied to staff and customers when it promised to increase branch staff numbers while outsourcing 500 back office jobs to India; the bank subsequently announced sweeping cuts in branch staffing. Only truly distinguished performances by two other contenders saved ANZ-National from the Roger this time around” (the Roger Award was won by British American Tobacco NZ Ltd, with Rio Tinto Aluminium NZ Ltd as runner-up).
NZ taxpayers are now the guarantors of the deposits of the banks. Yet we get no say in their running, let alone ownership. The Australian-owned banks go on their merry way piling up profits as if the crash has never happened, while at the same time turning off credit for their NZ customers, refusing to reimburse mum and dad investors whom they have bilked, laying off staff in their hundreds and outsourcing their jobs to Third World cheap labour. It’s time for the Government to remind the foreign banks of that old saying most favoured by moneymen: “He who pays the piper calls the tune”, and to translate that into action.
The Campaign Against Foreign Control of Aotearoa (CAFCA) fully supports the Frozen Funds Group in its campaign (which now includes pickets of ANZ branches) to get this Australian–owned bank to repay hapless small NZ investors whose money has been frozen due to the collapse of two investment funds run by its subsidiary ING NZ Ltd.
This was the main reason that ANZ was a finalist in the latest (2008) Roger Award for the Worst Transnational Corporation Operating in Aotearoa/New Zealand. To quote from the Judges’ Report: “The key charge against ANZ-National in 2008 was its reckless promotion to its banking customers of two investment funds run by its subsidiary ING NZ Ltd, which were then frozen, imprisoning $520 million of small investors’ money. The bank ducked responsibility on all fronts – for giving shonky advice, for misrepresenting ING as ‘low risk’, for failing to bail out its subsidiary to avoid the need to freeze funds, and for continuing to collect advisor fees during the freeze. While keeping the funds frozen, ING then announced a profit of $36 million. As a comprehensive case study of the rapacity and unconscionable behaviour at the expense of ordinary investors that have brought the reputation of Wall Street and its local clones to a new low, the ING saga stacks up well. ANZ has also been a central player in the Opus Prime insolvency in Australia, where again small investors were fleeced while the bank initially concealed crucial information and then looked after itself when the crash came. Only after the Banking Ombudsman became involved did ANZ-National begin paying off a few individual victims caught in the ING affair, ‘on a goodwill basis’. ‘Goodwill’ in this context seems to mean good public relations rather than any real relief for the majority of burned investors”.
And CAFCA supports the campaign by Finsec, the bank worker’s union, to keep bank jobs in NZ. This applies to all four of the Australian-owned banks – ANZ, BNZ, Westpac and ASB - but once again ANZ has “distinguished” itself in this field. To quote, again, from the 2008 Roger Award Judges’ Report: “Buttressing the case against ANZ-National was evidence from Finsec that the bank’s management lied to staff and customers when it promised to increase branch staff numbers while outsourcing 500 back office jobs to India; the bank subsequently announced sweeping cuts in branch staffing. Only truly distinguished performances by two other contenders saved ANZ-National from the Roger this time around” (the Roger Award was won by British American Tobacco NZ Ltd, with Rio Tinto Aluminium NZ Ltd as runner-up).
NZ taxpayers are now the guarantors of the deposits of the banks. Yet we get no say in their running, let alone ownership. The Australian-owned banks go on their merry way piling up profits as if the crash has never happened, while at the same time turning off credit for their NZ customers, refusing to reimburse mum and dad investors whom they have bilked, laying off staff in their hundreds and outsourcing their jobs to Third World cheap labour. It’s time for the Government to remind the foreign banks of that old saying most favoured by moneymen: “He who pays the piper calls the tune”, and to translate that into action.
THE GLOBAL ECONOMIC CRISIS, FREE TRADE AGREEMENTS & PRIVATISATION
Murray Horton gave this speech to a Workers Rights Campaign Seminar in Christchurch at the weekend.
You don’t need me to tell you that the world is in a once in a century economic crisis right now. As capitalism (which is usually misleadingly labelled as “democracy”) was declared the winner of the nearly 50 year long Cold War, and capitalist triumphalism was the dominant theme of the past two decades, along with American unilateralism, this means that what we are experiencing is a genuine, full blown crisis of capitalism. I should say at the outset that, unfortunately, I do not share the view that this means “the death of capitalism”. It has survived and mutated into new forms throughout all its previous great and small crises, including the Depression, which is the only precedent for what we’re experiencing now. It won’t die unless something kills it. As my old mate Chairman Mao said: “If you don’t hit it, it won’t fall”. But that’s a whole different subject from what we’re discussing today. I do hope, for all our sakes that this crisis does not mutate into fascism and world war as the last one did.
The consensus seems to be that the full force of the tsunami hasn’t yet reached our distant shores and the worst is still to come, that NZ is maybe 12 months behind the rest of the world. It is easy to deny that what has happened in the much bigger and quite different economies of, say, the US and Britain, won’t be replicated here. After all, our banks did not get into the outright criminality of subprime mortgages, nor do we have crippling imperialist wars to finance. So, it is instructive to consider what has happened to a comparable country, namely Ireland, once known as the Celtic Tiger. Ireland has a similar size population, used to rely on agriculture as its mainstay, has always exported people as we do, and had systemic high unemployment. The cure for all of this was supposed to be foreign investment, with all sorts of inducements offered to the transnational corporations (TNCs), particularly those in the manufacturing end of the high tech electronic industry, to get them to set up shop there. For a while there things were rosy indeed and the country boomed, particularly the housing market (does that sound familiar?). Ireland was regularly cited as a model for NZ, an example of a country that had moved to a “new, smart” economy. But now the TNCs like Dell are quitting Ireland for cheaper labour locations such as Poland.
To quote Time (6/4/09): “The good times owed much to the arrival of foreign-owned companies like Dell – such firms account for almost 90% of Irish exports and more than two thirds of the country’s business R&D – so the scaling down of a flagship investor is a real blow. It’s not the only one. After more than decade of rampant growth, Ireland now looks anaemic. A burst property bubble has landed the country in a deep recession. The economy could shrink as much as 6.5% this year, with unemployment set to reach 12%. Irish banks – massively exposed to property – look wobbly, and as tax receipts dwindle, public finances are in a mess”. The parallel is not exact, of course – foreign investors in NZ have tended not to actually set up very much by way of manufacturing plants here, and NZ manufacturers have headed for the cheaper labour of anywhere from Fiji to China in the past two decades. So manufacturing was already buggered before this latest crisis came along. But there is enough commonality there to sound a very loud warning to NZ. If you put all your eggs in the basket marked “foreign investment”, prepare to be left with just a mess of broken eggs.
What the major capitalist countries are doing is throwing unimaginably huge sums of money at the problem in an attempt to “save capitalism” (or, at least, to save the skins of their respective ruling classes who got them into the mess in the first place). Some more excitable commentators have described this as socialism. No such luck, it is simply State capitalism on an enormous scale. But, whatever it is called, it represents a fundamentally different species of capitalism to the completely laissez faire variety that has been globally running amok for the past 30 odd years. The more perceptive of the capitalist leaders have recognised that things can not simply proceed as they did before, or else this whole scenario will be repeated. In short, something has to change.
But not as far as good old New Zealand is concerned. I’ve already said that there is a tsunami coming but our Government is running full tilt towards it, transfixed by the big, shiny wave. While the rest of the capitalist world is now full of born again Keynesians (and Marx is being studied again as the most insightful critic of capitalism). But National and Act, and their strangely silent Maori Party partner, are still living in the recent past, where the patron saints were Adam Smith, Friedrich von Hayek and Milton Friedman, not to mention Roger Douglas. They are behaving as if nothing has happened or, even worse, that nothing is going to happen.
A distinguishing characteristic of this denial of reality is the Government’s continued fixation on foreign “investment” as the answer to all questions. It got elected as “Labour Lite” (actually Labour was pretty much “Labour Lite” in the first place) but has decided that the already considerably liberalised Overseas Investment Act, which came into force only as recently as 2005 (Michael Cullen’s legacy) is “too tough” on the poor old TNCs and needs to be eased up even further. Bill English has announced a review of the Act, to be completed by the end of June, with new legislation ready by later this year. As the review has not yet been completed, we don’t know the details, but you can bet dollars to doughnuts that it will call for the door to be thrown wide open or, even better, ripped off the hinges. Tories are fond of calling for “locking them up and throwing away the key” in relation to crime; in the case of foreign investment, they call for unlocking the door and throwing away the key so that it can’t be locked again. I see this obsession with foreign investment (what they like to call “an open economy”) as being like a cargo cult, with the Government of the day (and it is a bipartisan obsession, with Labour equally as guilty) frantically cutting landing strips in the jungle and awaiting the arrival of the big shiny planes that will come out of the sky and bring all the cargo that will solve all our problems.
Two other broken down old nags make up this trifecta of losers – privatisation and “free trade”. New Zealand is a heavy backer of both. Privatisation is a very touchy subject for Tory strategists because the New Zealand people have had so much negative experience of it, and don’t want any more of it. It was given free rein here in the 80s and 90s and was a bloody disaster. Key got elected by promising not to privatise any State assets during his first term, including the likes of Kiwi Rail which was only renationalised by Labour in its last few months in power. This election promise is one which will stick in the throat of the National and Act ideologues and they will be working overtime to think up ways to privatise things without actually calling it privatisation. Hence the talk of “opening up ACC to competition” (which will come from the global insurance TNCs – the mates of AIG, the US insurance giant which has come to personify everything that is wrong with the global financial sector) rather than baldly announcing that ACC is to be flogged off. Hence the death by a thousand cuts of TVNZ. To give just the most recent example – if you want to watch the 2011 Rugby World Cup in its entirety, you’ll need to pay for Sky TV, it won’t all be on free to air. So, TVNZ loses more and more of the prizes and its demise becomes a self-fulfilling prophecy as viewers feel compelled to switch to Sky. Then the Government will be able to self righteously wring its hands and say that it has no alternative but to sell TVNZ, for a bargain price. Hence the new fashion of Public Private Partnerships in sectors such as roads and other infrastructure, with these PPPs (first championed by Labour) being seen as a more acceptable alternative to outright privatisation, with the added benefit for the TNCs that they don’t have to shoulder all the cost and the risk.
“Free” trade is an absolute item of faith for both National and Labour, who use it to look at the world down the wrong end of the telescope. Jane Kelsey has described the bipartisan approach as being “what is good for Fonterra is good for New Zealand”, meaning there is an absolute obsession with opening up global markets for NZ agricultural products, with no concern whatsoever for the disastrous impacts of the reciprocal opening of the NZ economy (nor for the truly catastrophic effects that “free” trade has on the poor countries who comprise the majority of the world’s people – but that’s a separate subject). New Zealand, who gifted Mike Moore to the world as one of its Directors General, has been monomaniacal in its drive to get the Doha Round of the World Trade Organisation wrapped up. But, despite our best efforts, the talks are hopelessly stalled. Why? Because other countries, including the very biggest capitalist ones, are not as keen as us to jump off the cliff, trusting only in “the market” to ensure a safe landing. All of those other countries quite unashamedly have their own national interests to be protected.
Both National and Labour governments have worked tirelessly to sign NZ up to free trade agreements, any free trade agreements. If the multilateral WTO talks are bogged down, then NZ hares off after other regional or bilateral agreements. It’s worth listing what trade agreements NZ is already in:
Closer Economic Relations with Australia;
multilateral agreements with the Association of South East Asian Nations; the Pacific Agreement on Closer Economic Relations (with various Pacific countries); the Pacific Four (P4) Agreement with Singapore, Chile and Brunei;
bilateral Free Trade Agreements with China, Singapore and Thailand;
and bilateral investment agreements with Hong Kong and China.
In addition, the following Free Trade Agreements are currently under negotiation by the NZ government:
An expanded P4, now called the Transpacific, involving the US, Singapore, Brunei, Chile, Australia, Peru and perhaps Vietnam and others;
South Korea;
Hong Kong;
Gulf States;
and India.
New Zealand is nothing if not persistent. The proposed Hong Kong Free Trade Agreement stalled in 2002, under Labour, and the restart of negotiations was only announced this year. Of those currently under negotiation the most important is the Transpacific, because its announcement in the final few months of the Labour government was heralded as the means to secure the Holy Grail of a Free Trade Agreement with the US. Fortunately, the Obama Administration has put a fly in the ointment by announcing the indefinite suspension of negotiations while it conducts a review of the trade policy it inherited from George Bush. This doesn’t mean that the deal is off, just that it’s on hold for the meantime, much to the disappointment of both National and Labour.
It is important to realise that these agreements, both current and those under negotiation, are not just about trade. They contain major provisions locking in a heavily tilted playing field for the TNCs. For example, under NZ’s Free Trade Agreement with China any further opening of foreign investment cannot be rolled back by future NZ governments as it applies to Chinese investors without the consent of the Chinese government. Similar provisions apply in the other actual or potential Free Trade Agreements. It is called the National Treatment provision, meaning that companies from the other country must be treated the same as NZ companies, otherwise they can claim that they are being discriminated against and seek legal redress.
Who is driving this whole agenda? Obviously the ideologues in both National and Act (the latter is very much the tail wagging the dog), plus their allies in Labour. Treasury, which was sidelined to some degree under Labour, is back in the driving seat – its officials are conducting the review of the Overseas Investment Act. Treasury makes no secret that it supports no legal differentiation between foreign and NZ companies and that is what it recommended to the Labour government the last time the Act was reviewed – Labour was not prepared to go that far, because of opposition from within its own caucus and from its own voters. As we have recently seen, the OECD has issued a diktat to NZ urging, among many other things, wholesale privatisation, State asset sales, slashing public services and liberalising the foreign investment law. This is richly ironic coming from the mouthpiece of the richest capitalist economies which are themselves doing just the opposite, namely drastically increasing the role of the State (or, at least, taxpayers’ money) in the failed private sector. Obviously the OECD ideologues are as hopelessly out of touch with reality as their NZ counterparts. The agenda is also being driven by interested parties such as major NZ law firm Chapman Tripp, which makes a nice living out of acting for foreign investors. It called for a major review of the Act to sort out what it calls the “muddle”. The Government’s terms of reference for the review bear a strong resemblance to Chapman Tripp’s recommendations. It is driven by foreign investors themselves, such as a gentleman called Farhad Vladi who buys and sells islands around the world (including in NZ) for his super rich clients. He told the media recently that the current law is unfair to, and too tough on, foreign investors. And finally it is driven by the transnational corporate media which campaigned tirelessly to get National back into power and which all too often parrots the party line that “NZ needs to further open our economy”.
I’ve been asked to speak about the consequences of all this for workers, so I’ll conclude with that. I would have thought that they were pretty self evident. I used to be a “real” worker myself, so I’ll speak about where I used to work, namely the Railways. I was made redundant in 1991, just before the former Employment Contracts Act came into force. But I was there, indeed I was a union official, right through the period of “rationalising, restructuring and corporatisation”, all of which led to massive unemployment (including myself). That Act, which was part of the last National government’s drive to “make NZ attractive to foreign investors”, slashed pay and eliminated conditions for all NZ workers and disempowered the great majority of them by deunionising them. The disastrous privatisation of the Railways that followed in 1993, lasting until 2008, led to further mass unemployment and in the case of the criminally negligent TranzRail, deaths and injuries to both its workers and the public. There are very good reasons why TranzRail won three of the first six Roger Awards for the Worst Transnational Corporation Operating in Aotearoa/New Zealand. It was a text book example of what happens when a State asset is privatised. Telecom is the other big one, but there are plenty more. I’m sure that there are people here who can provide their own experiences. A policy of untrammelled foreign investment, free trade and privatisation is extremely bad for workers because that policy is a major contributor to what is known as the race to the bottom, to the lowest common denominator.
And finally, we need to dispel some of the pernicious myths peddled by these cultists about foreign “investment” as the One True Path to the Promised Land.
It doesn’t bring in “much needed money”. Quite the opposite, it sucks money out of the country. In the decade 1997-2006 transnational corporations made $50 billion profits in NZ. Only 32% of that was reinvested here; meaning that 2/3 of that enormous sum left the country. That is itself is a major cause of NZ’s Current Account Deficit (the Balance of Payments) being so high.
It doesn’t provide “much needed jobs”. Foreign companies only employ 19% of the NZ workforce, despite owning a disproportionately large chunk of the economy. 81% work for NZ employers. And those very same foreign companies significantly add to the unemployment total, having made tens of thousands of NZ workers jobless in the decades in which we’ve had a “liberalised” foreign investment regime.
It does nothing to improve NZ’s foreign debt problem. This is one area highlighted by the OECD report and it is nonsense. In 1984, when Rogernomics started, NZ’s total private and public foreign debt was $16 billion. By December 2008, it was $248 billion, the vast majority of that held by the corporate sector, not the Government, and totaling 137% of GDP. So, despite all those numerous State asset sales, the foreign debt has just kept on soaring.
Continuing to follow these discredited policies is a recipe for disaster, even on capitalist terms. They lead only to a dead end and in the process it will be ordinary NZ workers who will get badly hurt. It is what has happened in the past, it is happening now and blind adherence to this mumbo jumbo will only make it worse.
You don’t need me to tell you that the world is in a once in a century economic crisis right now. As capitalism (which is usually misleadingly labelled as “democracy”) was declared the winner of the nearly 50 year long Cold War, and capitalist triumphalism was the dominant theme of the past two decades, along with American unilateralism, this means that what we are experiencing is a genuine, full blown crisis of capitalism. I should say at the outset that, unfortunately, I do not share the view that this means “the death of capitalism”. It has survived and mutated into new forms throughout all its previous great and small crises, including the Depression, which is the only precedent for what we’re experiencing now. It won’t die unless something kills it. As my old mate Chairman Mao said: “If you don’t hit it, it won’t fall”. But that’s a whole different subject from what we’re discussing today. I do hope, for all our sakes that this crisis does not mutate into fascism and world war as the last one did.
The consensus seems to be that the full force of the tsunami hasn’t yet reached our distant shores and the worst is still to come, that NZ is maybe 12 months behind the rest of the world. It is easy to deny that what has happened in the much bigger and quite different economies of, say, the US and Britain, won’t be replicated here. After all, our banks did not get into the outright criminality of subprime mortgages, nor do we have crippling imperialist wars to finance. So, it is instructive to consider what has happened to a comparable country, namely Ireland, once known as the Celtic Tiger. Ireland has a similar size population, used to rely on agriculture as its mainstay, has always exported people as we do, and had systemic high unemployment. The cure for all of this was supposed to be foreign investment, with all sorts of inducements offered to the transnational corporations (TNCs), particularly those in the manufacturing end of the high tech electronic industry, to get them to set up shop there. For a while there things were rosy indeed and the country boomed, particularly the housing market (does that sound familiar?). Ireland was regularly cited as a model for NZ, an example of a country that had moved to a “new, smart” economy. But now the TNCs like Dell are quitting Ireland for cheaper labour locations such as Poland.
To quote Time (6/4/09): “The good times owed much to the arrival of foreign-owned companies like Dell – such firms account for almost 90% of Irish exports and more than two thirds of the country’s business R&D – so the scaling down of a flagship investor is a real blow. It’s not the only one. After more than decade of rampant growth, Ireland now looks anaemic. A burst property bubble has landed the country in a deep recession. The economy could shrink as much as 6.5% this year, with unemployment set to reach 12%. Irish banks – massively exposed to property – look wobbly, and as tax receipts dwindle, public finances are in a mess”. The parallel is not exact, of course – foreign investors in NZ have tended not to actually set up very much by way of manufacturing plants here, and NZ manufacturers have headed for the cheaper labour of anywhere from Fiji to China in the past two decades. So manufacturing was already buggered before this latest crisis came along. But there is enough commonality there to sound a very loud warning to NZ. If you put all your eggs in the basket marked “foreign investment”, prepare to be left with just a mess of broken eggs.
What the major capitalist countries are doing is throwing unimaginably huge sums of money at the problem in an attempt to “save capitalism” (or, at least, to save the skins of their respective ruling classes who got them into the mess in the first place). Some more excitable commentators have described this as socialism. No such luck, it is simply State capitalism on an enormous scale. But, whatever it is called, it represents a fundamentally different species of capitalism to the completely laissez faire variety that has been globally running amok for the past 30 odd years. The more perceptive of the capitalist leaders have recognised that things can not simply proceed as they did before, or else this whole scenario will be repeated. In short, something has to change.
But not as far as good old New Zealand is concerned. I’ve already said that there is a tsunami coming but our Government is running full tilt towards it, transfixed by the big, shiny wave. While the rest of the capitalist world is now full of born again Keynesians (and Marx is being studied again as the most insightful critic of capitalism). But National and Act, and their strangely silent Maori Party partner, are still living in the recent past, where the patron saints were Adam Smith, Friedrich von Hayek and Milton Friedman, not to mention Roger Douglas. They are behaving as if nothing has happened or, even worse, that nothing is going to happen.
A distinguishing characteristic of this denial of reality is the Government’s continued fixation on foreign “investment” as the answer to all questions. It got elected as “Labour Lite” (actually Labour was pretty much “Labour Lite” in the first place) but has decided that the already considerably liberalised Overseas Investment Act, which came into force only as recently as 2005 (Michael Cullen’s legacy) is “too tough” on the poor old TNCs and needs to be eased up even further. Bill English has announced a review of the Act, to be completed by the end of June, with new legislation ready by later this year. As the review has not yet been completed, we don’t know the details, but you can bet dollars to doughnuts that it will call for the door to be thrown wide open or, even better, ripped off the hinges. Tories are fond of calling for “locking them up and throwing away the key” in relation to crime; in the case of foreign investment, they call for unlocking the door and throwing away the key so that it can’t be locked again. I see this obsession with foreign investment (what they like to call “an open economy”) as being like a cargo cult, with the Government of the day (and it is a bipartisan obsession, with Labour equally as guilty) frantically cutting landing strips in the jungle and awaiting the arrival of the big shiny planes that will come out of the sky and bring all the cargo that will solve all our problems.
Two other broken down old nags make up this trifecta of losers – privatisation and “free trade”. New Zealand is a heavy backer of both. Privatisation is a very touchy subject for Tory strategists because the New Zealand people have had so much negative experience of it, and don’t want any more of it. It was given free rein here in the 80s and 90s and was a bloody disaster. Key got elected by promising not to privatise any State assets during his first term, including the likes of Kiwi Rail which was only renationalised by Labour in its last few months in power. This election promise is one which will stick in the throat of the National and Act ideologues and they will be working overtime to think up ways to privatise things without actually calling it privatisation. Hence the talk of “opening up ACC to competition” (which will come from the global insurance TNCs – the mates of AIG, the US insurance giant which has come to personify everything that is wrong with the global financial sector) rather than baldly announcing that ACC is to be flogged off. Hence the death by a thousand cuts of TVNZ. To give just the most recent example – if you want to watch the 2011 Rugby World Cup in its entirety, you’ll need to pay for Sky TV, it won’t all be on free to air. So, TVNZ loses more and more of the prizes and its demise becomes a self-fulfilling prophecy as viewers feel compelled to switch to Sky. Then the Government will be able to self righteously wring its hands and say that it has no alternative but to sell TVNZ, for a bargain price. Hence the new fashion of Public Private Partnerships in sectors such as roads and other infrastructure, with these PPPs (first championed by Labour) being seen as a more acceptable alternative to outright privatisation, with the added benefit for the TNCs that they don’t have to shoulder all the cost and the risk.
“Free” trade is an absolute item of faith for both National and Labour, who use it to look at the world down the wrong end of the telescope. Jane Kelsey has described the bipartisan approach as being “what is good for Fonterra is good for New Zealand”, meaning there is an absolute obsession with opening up global markets for NZ agricultural products, with no concern whatsoever for the disastrous impacts of the reciprocal opening of the NZ economy (nor for the truly catastrophic effects that “free” trade has on the poor countries who comprise the majority of the world’s people – but that’s a separate subject). New Zealand, who gifted Mike Moore to the world as one of its Directors General, has been monomaniacal in its drive to get the Doha Round of the World Trade Organisation wrapped up. But, despite our best efforts, the talks are hopelessly stalled. Why? Because other countries, including the very biggest capitalist ones, are not as keen as us to jump off the cliff, trusting only in “the market” to ensure a safe landing. All of those other countries quite unashamedly have their own national interests to be protected.
Both National and Labour governments have worked tirelessly to sign NZ up to free trade agreements, any free trade agreements. If the multilateral WTO talks are bogged down, then NZ hares off after other regional or bilateral agreements. It’s worth listing what trade agreements NZ is already in:
Closer Economic Relations with Australia;
multilateral agreements with the Association of South East Asian Nations; the Pacific Agreement on Closer Economic Relations (with various Pacific countries); the Pacific Four (P4) Agreement with Singapore, Chile and Brunei;
bilateral Free Trade Agreements with China, Singapore and Thailand;
and bilateral investment agreements with Hong Kong and China.
In addition, the following Free Trade Agreements are currently under negotiation by the NZ government:
An expanded P4, now called the Transpacific, involving the US, Singapore, Brunei, Chile, Australia, Peru and perhaps Vietnam and others;
South Korea;
Hong Kong;
Gulf States;
and India.
New Zealand is nothing if not persistent. The proposed Hong Kong Free Trade Agreement stalled in 2002, under Labour, and the restart of negotiations was only announced this year. Of those currently under negotiation the most important is the Transpacific, because its announcement in the final few months of the Labour government was heralded as the means to secure the Holy Grail of a Free Trade Agreement with the US. Fortunately, the Obama Administration has put a fly in the ointment by announcing the indefinite suspension of negotiations while it conducts a review of the trade policy it inherited from George Bush. This doesn’t mean that the deal is off, just that it’s on hold for the meantime, much to the disappointment of both National and Labour.
It is important to realise that these agreements, both current and those under negotiation, are not just about trade. They contain major provisions locking in a heavily tilted playing field for the TNCs. For example, under NZ’s Free Trade Agreement with China any further opening of foreign investment cannot be rolled back by future NZ governments as it applies to Chinese investors without the consent of the Chinese government. Similar provisions apply in the other actual or potential Free Trade Agreements. It is called the National Treatment provision, meaning that companies from the other country must be treated the same as NZ companies, otherwise they can claim that they are being discriminated against and seek legal redress.
Who is driving this whole agenda? Obviously the ideologues in both National and Act (the latter is very much the tail wagging the dog), plus their allies in Labour. Treasury, which was sidelined to some degree under Labour, is back in the driving seat – its officials are conducting the review of the Overseas Investment Act. Treasury makes no secret that it supports no legal differentiation between foreign and NZ companies and that is what it recommended to the Labour government the last time the Act was reviewed – Labour was not prepared to go that far, because of opposition from within its own caucus and from its own voters. As we have recently seen, the OECD has issued a diktat to NZ urging, among many other things, wholesale privatisation, State asset sales, slashing public services and liberalising the foreign investment law. This is richly ironic coming from the mouthpiece of the richest capitalist economies which are themselves doing just the opposite, namely drastically increasing the role of the State (or, at least, taxpayers’ money) in the failed private sector. Obviously the OECD ideologues are as hopelessly out of touch with reality as their NZ counterparts. The agenda is also being driven by interested parties such as major NZ law firm Chapman Tripp, which makes a nice living out of acting for foreign investors. It called for a major review of the Act to sort out what it calls the “muddle”. The Government’s terms of reference for the review bear a strong resemblance to Chapman Tripp’s recommendations. It is driven by foreign investors themselves, such as a gentleman called Farhad Vladi who buys and sells islands around the world (including in NZ) for his super rich clients. He told the media recently that the current law is unfair to, and too tough on, foreign investors. And finally it is driven by the transnational corporate media which campaigned tirelessly to get National back into power and which all too often parrots the party line that “NZ needs to further open our economy”.
I’ve been asked to speak about the consequences of all this for workers, so I’ll conclude with that. I would have thought that they were pretty self evident. I used to be a “real” worker myself, so I’ll speak about where I used to work, namely the Railways. I was made redundant in 1991, just before the former Employment Contracts Act came into force. But I was there, indeed I was a union official, right through the period of “rationalising, restructuring and corporatisation”, all of which led to massive unemployment (including myself). That Act, which was part of the last National government’s drive to “make NZ attractive to foreign investors”, slashed pay and eliminated conditions for all NZ workers and disempowered the great majority of them by deunionising them. The disastrous privatisation of the Railways that followed in 1993, lasting until 2008, led to further mass unemployment and in the case of the criminally negligent TranzRail, deaths and injuries to both its workers and the public. There are very good reasons why TranzRail won three of the first six Roger Awards for the Worst Transnational Corporation Operating in Aotearoa/New Zealand. It was a text book example of what happens when a State asset is privatised. Telecom is the other big one, but there are plenty more. I’m sure that there are people here who can provide their own experiences. A policy of untrammelled foreign investment, free trade and privatisation is extremely bad for workers because that policy is a major contributor to what is known as the race to the bottom, to the lowest common denominator.
And finally, we need to dispel some of the pernicious myths peddled by these cultists about foreign “investment” as the One True Path to the Promised Land.
It doesn’t bring in “much needed money”. Quite the opposite, it sucks money out of the country. In the decade 1997-2006 transnational corporations made $50 billion profits in NZ. Only 32% of that was reinvested here; meaning that 2/3 of that enormous sum left the country. That is itself is a major cause of NZ’s Current Account Deficit (the Balance of Payments) being so high.
It doesn’t provide “much needed jobs”. Foreign companies only employ 19% of the NZ workforce, despite owning a disproportionately large chunk of the economy. 81% work for NZ employers. And those very same foreign companies significantly add to the unemployment total, having made tens of thousands of NZ workers jobless in the decades in which we’ve had a “liberalised” foreign investment regime.
It does nothing to improve NZ’s foreign debt problem. This is one area highlighted by the OECD report and it is nonsense. In 1984, when Rogernomics started, NZ’s total private and public foreign debt was $16 billion. By December 2008, it was $248 billion, the vast majority of that held by the corporate sector, not the Government, and totaling 137% of GDP. So, despite all those numerous State asset sales, the foreign debt has just kept on soaring.
Continuing to follow these discredited policies is a recipe for disaster, even on capitalist terms. They lead only to a dead end and in the process it will be ordinary NZ workers who will get badly hurt. It is what has happened in the past, it is happening now and blind adherence to this mumbo jumbo will only make it worse.
The Domebusters - One Year On
CLOSE WAIHOPAI SPYBASE!
It is one year today since the Ploughshares peace activists deflated one of the two domes at the top secret Waihopai spybase (and, in the process, severely deflated the supposed top security of that base). No date has yet been set for the trial of Adrian Leason, Sam Land and Peter Murnane.
Anti-Bases Campaign declared our support for their symbolic action at the time and nothing has happened since to change our view. Indeed, the need to close the Waihopai spybase ASAP is more urgent than ever.
There is a sham debate going on within the Government at present about whether to agree or not to the formal US request to re-commit NZ combat troops, namely the SAS, to help the US wage its worsening war in Afghanistan. New Zealand’s biggest commitment to that, and any other US-led war (Pakistan is next on the list) is not troops or frigates, etc, but Waihopai which, 24 hours a day, every day of the year, is functioning as a vital outpost of US Intelligence on NZ soil. The Bush Administration declared intelligence to be a vital component of its warfighting capacity. The Obama Administration has not changed that emphasis, indeed it relies on it even more in its re-prioritising the war in Afghanistan (and, increasingly, Pakistan) over that in Iraq. Waihopai is part of a global network of US-controlled spybases gathering electronic intelligence and that is what the US military depends on in wars such as in Afghanistan.
April 30 is also the anniversary of the liberation of Saigon (Ho Chi Minh City), the biggest defeat thus far in the history of the American Empire. That war also spread into the countries neighbouring Vietnam, with disastrous consequences, just as the Afghan war has spread into its neighbour.
The coincidence of these two anniversaries on April 30 is a good time for New Zealand to reflect upon what it is still doing, a generation later and despite being nuclear free and out of ANZUS, loyally serving the US and helping it fight its wars and bully the world by hosting a small but vital cog in the global American network of spybases. We pride ourselves on being independent. That won’t be a fact until we have broken the covert ties that still closely bind us to the US war machine.
Close Waihopai spybase now!
It is one year today since the Ploughshares peace activists deflated one of the two domes at the top secret Waihopai spybase (and, in the process, severely deflated the supposed top security of that base). No date has yet been set for the trial of Adrian Leason, Sam Land and Peter Murnane.
Anti-Bases Campaign declared our support for their symbolic action at the time and nothing has happened since to change our view. Indeed, the need to close the Waihopai spybase ASAP is more urgent than ever.
There is a sham debate going on within the Government at present about whether to agree or not to the formal US request to re-commit NZ combat troops, namely the SAS, to help the US wage its worsening war in Afghanistan. New Zealand’s biggest commitment to that, and any other US-led war (Pakistan is next on the list) is not troops or frigates, etc, but Waihopai which, 24 hours a day, every day of the year, is functioning as a vital outpost of US Intelligence on NZ soil. The Bush Administration declared intelligence to be a vital component of its warfighting capacity. The Obama Administration has not changed that emphasis, indeed it relies on it even more in its re-prioritising the war in Afghanistan (and, increasingly, Pakistan) over that in Iraq. Waihopai is part of a global network of US-controlled spybases gathering electronic intelligence and that is what the US military depends on in wars such as in Afghanistan.
April 30 is also the anniversary of the liberation of Saigon (Ho Chi Minh City), the biggest defeat thus far in the history of the American Empire. That war also spread into the countries neighbouring Vietnam, with disastrous consequences, just as the Afghan war has spread into its neighbour.
The coincidence of these two anniversaries on April 30 is a good time for New Zealand to reflect upon what it is still doing, a generation later and despite being nuclear free and out of ANZUS, loyally serving the US and helping it fight its wars and bully the world by hosting a small but vital cog in the global American network of spybases. We pride ourselves on being independent. That won’t be a fact until we have broken the covert ties that still closely bind us to the US war machine.
Close Waihopai spybase now!
Peace protester arrested at base
Ms Percy was arrested near the American spy base outside HarrogateA peace campaigner opposed to the activities of an American spy base in North Yorkshire has been arrested outside the site for a bail offence.
Lindis Percy, 64, formerly from Hull, was arrested on Friday evening during a demonstration near Menwith Hill base on the outskirts of Harrogate.
A North Yorkshire Police spokesman said the 67-year-old had been arrested for a breach of bail
conditions.
Ms Percy has been jailed several times for demonstrating outside US bases.
Subscribe to:
Comments (Atom)
