The following appeared in the Press today. It is full of inaccurate information and its general tone and politics is revolting. No wonder mainstream media is going to the dogs - if this is the best they can come up with. If nothing else - it is lazy. The inaccaurate information would have been obvious to the writer - they just did not bother to check up on it.
Murray Horton has not yet received his own SIS file - just that of CAFCA - a group he help to found. If the writer of this piece had read the article throughly that appeared in their own paper yesterday they would have been aware of this.
As for the inaccurate and insulting accusations made to Bill Sutch - the writer of this editorial needs to read up on there history. Sutch was acquitted - not found guilty as is most definitley more then implied in this piece.
Anyway after that objective introduction have a read for yourself.
Return of SIS files
A whiff of the musty battles of the Cold War years was recalled this week with news on the release of files held by the Security Intelligence Service on activists and others in Christchurch, writes The Press in an editorial.
Under a policy adopted by the SIS six years ago to allow the release of material that is now only of historical interest, the ageing Left-wing agitator Murray Horton and Bill Rosenberg, the son of the late Marxist economist Wolfgang Rosenberg, have obtained their own SIS files.
According to the director of the SIS, Dr Warren Tucker, 26 people received their personal files last year and they had welcomed the service's greater openness. As the events with which the files deal recede into the past, the SIS's proactive declassification of files and impartial release of the information is to be commended. It not only helps understanding of our recent history, it can increase confidence about the way in which the SIS itself has carried out its functions.
The activities of the security intelligence services have been a particular hobgoblin in Left-wing circles at least since the SIS caught William Ball Sutch passing material to the Soviet Union in the 1970s. It continues to this day with the agitation against the spy base at Waihopai. Horton is inclined to find the old files on him and his Campaign Against Foreign Control of Aotearoa organisation sinister. In a wildly hyperbolic flourish, he claims it shows that New Zealand has behaved towards dissidents in much the same way as communist police states.
Horton needs to become better acquainted with how the Soviet KGB (even the present Russian FSB) operate. It is somewhat rougher than the mere collection of snippets of rather dull personal gossip and subscribing to activists' newsletters. In communist countries during the Cold War, dissidents and activists were jailed or exiled, or worse.
As Tucker correctly noted, the SIS files have to be viewed in their historical context. The service's methods and those it is interested in have changed over the years. During the Cold War, its target was foreign attempts at subversion, which have since been well documented, often through legitimate political organisations. The SIS would have been remiss if it had not directed itself at that just as nowadays it would be remiss if it did not pay attention to the activities of religious extremists.
To judge from the file on Cafca that Horton has obtained, the SIS's interest in the organisation does not seem to have been very great and appears to have been at its height during protests and such, when there might have been the possibility of legitimate security concerns. By the mid-1980s the SIS recognised that Cafca was of "minimal security interest" and stopped spying on it.
Rosenberg suggests that the file on his father reflects a McCarthyite mindset and wonders whether it impeded his father's application for a professorship. There is no evidence of that. In fact, far from having his career ruined, as happened to many of the disreputable Senator Joseph McCarthy's victims, Wolfgang Rosenberg, who was for many years an active supporter of the communist autocracies in North Korea and elsewhere, had a long and uninterrupted career as a senior academic at Canterbury University, and was frequently employed by state radio. McCarthyism has never formed much of New Zealand's mindset.
And more on the SIS
A number of activists have requested their SIS files. Here is an article sparked by yesterdays one about CAFCA.
Spied on since she was 10
By MARTIN VAN BEYNEN -
The Press Thursday, 29 January 2009
JOHN SELKIRK/The Dominion Post
I SPY: Activist Marie Leadbeater, 63, discovered that she has had her own SIS file since was 10-years-old.
You are never too young to be regarded as a potential subversive, a Security Intelligence Service file shows.
Maire Leadbeater, now 63 and a long-time activist on peace issues, was an early target because of her Christchurch parents, Elsie and Jack Locke, who were prominent members of the New Zealand Communist Party and community activists.
Elsie Locke left the Communist Party in 1956 when the Soviet Union invaded Hungary, but her husband stayed.
One of Leadbeater's siblings is Green MP Keith Locke, a former Trotskyist and member of the Socialist Action League who has also received his SIS file.
Leadbeater's file, which she received late last year, begins when she was 10, with a note that she delivered the Communist Party newspaper, the People's Voice, to the mother of twins in Bangor St, in central Christchurch.
The next item refers to her membership of a junior drama group that the file says was connected with the William Morris (a Fabian socialist) Group, regarded by the SIS as a front for the Communist Party. Elsie Locke performed in the group.
The file continues to track Leadbeater's life, although the SIS lost track of her when she married and took her husband's name. "They lost me for about 13 years," she said.
Her file, like most of the others released, contains material from private meetings.
"I find that the hardest to accept," Leadbeater said. "That small groups of people gathering together in private homes and offices should have someone planted in the meetings.
"It's pretty shocking really. It's potentially very bad for democracy because it makes people anxious about involving themselves in free discussion of ideas and has a big impact on trust if you have to think to yourself `one of us could be a source'."
She was surprised to find her file contains a list of every member of the Palestine Human Rights Committee.
Her file contained references to the state of her parents' marriage, which the SIS thought would be strained by Elsie's departure from the party.
``It's all wrong anyway,'' Leadbeater said. ``It's unpleasant, inaccurate speculation about highly personal family issues.''
The most recent item on her file is a reference to a member of the South Auckland Muslim Association who said she would be taking part in a march on September 28, 2002.
Leadbeater's activities on behalf of the Fiji Coalition for Democracy, the anti-bases campaigns and the Ahmed Zaoui campaign are not mentioned in the file.
"Does this mean that snooping is less or done in a different way?'' she said.
Keith Locke confirmed he had received his own file, which was thick, and his mother's biographer was in possession of his mother's file. He had yet to view his file and was not prepared to comment.
Invercargill Mayor Tim Shadbolt, who was once prominent in a number of radical movements, said he would be travelling to Wellington to uplift his file as part of a TV3 news programme.
He was not sure the SIS kept a file on him, but said he would feel a bit insulted if it did not.
"It will make interesting reading. I suspect they would have got a lot more detail if they had just read my book Bullshit and Jellybeans,'' he said.
Shadbolt said he had led at least five radical organisations, including the Radical Students Association and Auckland University Students for the Prevention of Cruelty to Politically Apathetic Humans.
"If they figured out what [the latter organisation] was about, then good luck to them because we never could,'' he said.
Spied on since she was 10
By MARTIN VAN BEYNEN -
The Press Thursday, 29 January 2009
JOHN SELKIRK/The Dominion Post
I SPY: Activist Marie Leadbeater, 63, discovered that she has had her own SIS file since was 10-years-old.
You are never too young to be regarded as a potential subversive, a Security Intelligence Service file shows.
Maire Leadbeater, now 63 and a long-time activist on peace issues, was an early target because of her Christchurch parents, Elsie and Jack Locke, who were prominent members of the New Zealand Communist Party and community activists.
Elsie Locke left the Communist Party in 1956 when the Soviet Union invaded Hungary, but her husband stayed.
One of Leadbeater's siblings is Green MP Keith Locke, a former Trotskyist and member of the Socialist Action League who has also received his SIS file.
Leadbeater's file, which she received late last year, begins when she was 10, with a note that she delivered the Communist Party newspaper, the People's Voice, to the mother of twins in Bangor St, in central Christchurch.
The next item refers to her membership of a junior drama group that the file says was connected with the William Morris (a Fabian socialist) Group, regarded by the SIS as a front for the Communist Party. Elsie Locke performed in the group.
The file continues to track Leadbeater's life, although the SIS lost track of her when she married and took her husband's name. "They lost me for about 13 years," she said.
Her file, like most of the others released, contains material from private meetings.
"I find that the hardest to accept," Leadbeater said. "That small groups of people gathering together in private homes and offices should have someone planted in the meetings.
"It's pretty shocking really. It's potentially very bad for democracy because it makes people anxious about involving themselves in free discussion of ideas and has a big impact on trust if you have to think to yourself `one of us could be a source'."
She was surprised to find her file contains a list of every member of the Palestine Human Rights Committee.
Her file contained references to the state of her parents' marriage, which the SIS thought would be strained by Elsie's departure from the party.
``It's all wrong anyway,'' Leadbeater said. ``It's unpleasant, inaccurate speculation about highly personal family issues.''
The most recent item on her file is a reference to a member of the South Auckland Muslim Association who said she would be taking part in a march on September 28, 2002.
Leadbeater's activities on behalf of the Fiji Coalition for Democracy, the anti-bases campaigns and the Ahmed Zaoui campaign are not mentioned in the file.
"Does this mean that snooping is less or done in a different way?'' she said.
Keith Locke confirmed he had received his own file, which was thick, and his mother's biographer was in possession of his mother's file. He had yet to view his file and was not prepared to comment.
Invercargill Mayor Tim Shadbolt, who was once prominent in a number of radical movements, said he would be travelling to Wellington to uplift his file as part of a TV3 news programme.
He was not sure the SIS kept a file on him, but said he would feel a bit insulted if it did not.
"It will make interesting reading. I suspect they would have got a lot more detail if they had just read my book Bullshit and Jellybeans,'' he said.
Shadbolt said he had led at least five radical organisations, including the Radical Students Association and Auckland University Students for the Prevention of Cruelty to Politically Apathetic Humans.
"If they figured out what [the latter organisation] was about, then good luck to them because we never could,'' he said.
CAFCA's SIS file
CAFCA recently requested and was given it's historical file from the Secret Intelligence Service. Whilst in Christchurch over the summer I was able to read this file from start to finish. What I found to be the most astonishing was the lack of anything that would warrant their on-going surveillance. The interest in the personal lives of those involved and disturbing and comments made about individuals behaviour in meetings or there personal views was predictable from such an organisation - but none the less irritating. It serves as a an example of the constant surveillance anyone will be under who questions government, capitalism or adheres to anything but the status quo. Apart from the obvious 'why on earth were they doing this' reaction I actually found the file fascinating as historical reading. It gave in places almost a day to day account of what activists were up to. Of particular interest to me was the numerous pages committed to the 1975 Resistance Ride, which saw activists congregate from around the country for a tour of the south island stopping off at points of interest and at small towns to talk to local people. I had heard accounts of the Resistance Ride before but it was helpful to read the newspaper articles that were generated at the time. So there we go - our SIS - glorified newspaper clippers.
Here is an article that appeared in the Christchurch Press on Wednesday 28th January regarding the CAFCA SIS file.
SIS reveals secret files
Article 28 Jan 2009
The Press
Martin van Beynen
The release of Security Intelligence Service (SIS) files on individuals has revealed for the first time
how far the shadowy service reached into the lives of activist and non-activist New Zealanders.
In response to the SIS relaxing its approach to redundant files, the word has got out.
A flood of files is reaching the people spied on, with most of the clandestine reporting referring to
legitimate protest and political activity.
In November, Murray Horton, a former railway worker, applied for the file on the Campaign Against
Foreign Control of Aotearoa (Cafca), an organisation he helped found.
He received 400 documents, including a cover letter from SIS head Dr Wayne Tucker. It said the
spying had stopped.
The file presented a ‘‘fascinating and disturbing pattern of systematic covert state surveillance of
many, many organisations and many hundreds, if not thousands, of people over decades’’, Horton said.
He had seen other files. One showed the SIS had started monitoring an activist when she was 10.
An SIS spokesman said the service had adopted an archives policy in 2003 to aid ‘‘the proactive
declassification of historical records’’.
‘‘A key element of the archives policy is that the SIS will deal impartially with information, regardless
of whether it reflects unfavourably on the service or shows the service in a good light,’’ he said.
‘‘Subsequent publicity has led to an increase in requests for access to personal information . . . The
service has made every endeavour to be forthcoming.’’
The greater openness had been well-received, with 26 people being sent their personal files last year.
‘‘Recipients of declassified SIS reports have generally viewed them in their historical context and
realised that the service’s methods and informationcollection priorities have altered over the years as the
nature and perceptions of threats to security have changed.’’
The identity of agents and sources of information was deleted from the files, the spokesman said.
So much for democracy, Horton said.
‘‘Our own little country has been proven to behave towards its dissidents in much the same way as
the Communist police states that it used to rail against,’’ he said.
The worst of it was that the Cafca file and others released indiscreet and personally damaging
material about named third parties who were not the subject of the surveillance but simply caught up in
its net, he said.
‘‘A lot of it is salacious gossip, with analyses of named people’s marriage problems, drinking habits,
etc, etc,’’ Horton said.
‘‘Some of it is laughable, like a report dedicated to the likely impact of feminism and different gender
views on abortion on the marriages of named couples.’’
One report contained this reference to Horton: ‘‘He likes the sound of his own voice and keeps
interrupting the other speakers.’’
Bill Rosenberg, 57, who is a member of Cafca, told the Press he had received his personal file, some
of the file kept on his late father, Canterbury University economist Wolfgang Rosenberg, a refugee from
Nazi Germany, and also the file on his mother.
The deputy director of the centre for teaching and learning at Canterbury University said he had
never been a member of a political party but had been in several anti-war protest groups since his youth.
His father’s file showed he had been followed when he went around the country giving talks to
groups. His mother was also monitored because of her membership of the New Zealand Communist
Party in her youth and her involvement in organisations such as the Housewives Union.
His father’s application for a professorship at Victoria University was noted, and he wondered if the
SIS had intervened to ensure it failed.
The files reflected the paranoia of the McCarthy era but also the particular views of SIS staff,
Rosenberg said. ‘‘The release of the files marks a significant change in that degree of paranoia and that
view of the world.’’
His file contained mainly comments about him by Socialist Unity Party and Communist Party
members at private meetings. Most disturbing was the car registration numbers taken when people
visited his house after he had returned from overseas.
The picture emerging from the files was a ‘‘huge mixture of time-serving stuff’’ and reports about
innocuous events, Rosenberg said.
The lack of sophistication was startling and little analysis was done on why activities were suspicious.
The vast majority of reporting was about ‘‘perfectly legitimate political activity by people who had a
different view to the status quo’’, Rosenberg said.
SIS dossiers detail dalliances, dances and very little drama
Article rank 28 Jan 2009
The Press
Organisations and individuals throughout the country are finding out whythey
attracted the attention of the Security Intelligence Service as files no longer
regarded as live are released. MARTINVANBEYNENblows the dust off two
Christchurch files
Keeping files for the Security Intelligence Service (SIS) must have been a boring job. The file on the
Campaign Against Foreign Control of Aotearoa (Cafca, formerly Cafcinz, the Campaign Against Foreign
Control in New Zealand) contains about 400 mostly mundane documents, and goes back to its earlier
incarnation in 1965.
It consists mainly of newspaper clippings, Cafca publications and newsletters, press releases and
internal SIS memorandums providing reports on Cafca’s annual meetings. It also contains briefings to
the prime minister on Cafca and notes that some material was passed on to the United States
government.
Much of the information stems from the SIS’s District Office, Christchurch (DOC).
The SIS would not have needed to employ its full resources to garner the information. Most of it
would have been easily obtainable by subscription, and Cafca has always correctly assumed addresses
on its mailing list contained either post office boxes belonging to the SIS or the police Criminal
Intelligence Service.
SIS reports of meetings always identify the attendees, as do reports on pickets and protests. Other
happenings at such protests are recorded, including anti-government statements.
A record of a demonstration in 1980 notes an individual calling the government a ‘‘ripoff’’ and saying
the ‘‘Marxist way of life’’ was better.
Finances are often mentioned as links with other organisations.
By the mid-1980s, the SIS had almost lost interest in Cafca, regarding it as of ‘‘minimal security
interest’’.
A covering letter accompanying the released file by current SIS director Dr Warren Tucker says the
service would have been less interested in the organisation after 1977 if it had not continued with
protests against US bases and naval visits and with protests to abolish the SIS.
The SIS’s interest appears to have peaked in a period between 1975 and 1978 when Cafca or its
predecessor was involved in protests against the visit of US navy secretary J. W. Middendorf, the
berthing of Russian trawler Yunost at Lyttelton and the Pacific Basin Economic Council meeting in
Christchurch.
These followed the involvement of Cafca members in a protest and winning-hearts campaign called
the South Island Resistance Ride in 1975.
The Cafca file included a list of everyone on the ride, with their address and telephone number.
Preparations for the tour, such as ferry bookings, are documented.
The interest cranked up in 1976 when an attempt was made to sabotage a communications mast at
Weedons in Canterbury, and increased again in 1977 when seven .303 bullets were fired into an oil
tanker in protest against the visit of the US Union Oil chairman to the Pacific Basin meeting.
No evidence suggested any link with Cafca, but clearly it was strongly suspected, the file shows.
The prime minister was briefed on the organisation by then SIS director Paul Molineaux.
After skirmishes at the demonstration against the Pacific Basin meeting, the SIS notes on the file
appear to lament a ‘‘well-placed source’’ in Cafca who should have been able to ‘‘forewarn’’ the
authorities.
Although the file suggests a degree of infiltration of Cafca by the SIS by 1978, it did not go to the
trouble of planting a mole.
The main reason for the SIS’s curiosity about Cafca was the organisation’s suspected links and
shared personnel with the New Zealand Communist Party (CP), its youth arm, the Progressive Youth
Movement (PYM), the Socialist Unity Party of New Zealand (SUP) and various offshoots.
From the Cafca file it is clear the SIS had a mole within the Christchurch branch of the CP and as
early as 1975 the party source is reporting how the party regards Cafca as a good testing and recruiting
ground for converts.
The SIS took a much closer interest in CP members, which involved intercepting mail.
In 1986, its source reports on a meeting at which the perilous finances of the Christchurch branch are
discussed and the need to persuade Marion Lesley Hobbs (who later became a Labour Cabinet minister)
to pledge $10.
CP cadres did not always do Cafca any favours. In 1980, B, attending a CP meeting, is reported to
boast when drunk that Cafca had been responsible for the Weedons aerial sabotage on directions from
the CP. Cafca stalwart Murray Horton says the organisation was not involved.
The SIS expresses, in one memo, its satisfaction at the Cafca protest against the Russian trawler
visit, suggesting the protest would create a rift between Cafca and the ‘‘People’s Union’’.
The Cafca file, with its broad compass, contrasts with the file on Christchurch unionist Paul Corliss,
formerly the secretary of the Harbour Workers Union and convener of the Council of Trade Unions in
Canterbury. He is now a part-time union organiser.
He first came to the attention of the SIS in 1974 through his association with Horton and another
Cafca stalwart, Brian Rooney.
He worked with Horton as distribution manager for the Canterbury University student newspaper
Canta, and both men later worked in the traffic branch of New Zealand Railways in Christchurch.
Both are noted in Corliss’s file as ‘‘troublemakers to railways management’’.
Suspicions Corliss might be a member of SUP (he was never a member of the grouping) are also
noted. Corliss’s file tracks his rise up the ranks of the trade union movement and starts with his involvement
in the South Island Resistance Ride, for which he was in charge of food.
In the end, he could not be bothered going, he says.
His file mentions his attendance at a protest in 1980 in Lyttelton against the sale of coal to Japan and
also his arrest in a protest against the Springboks rugby tour in 1981.It records his promotion to Canterbury secretary of the National Union of Railwaymen and his part in a protest against minister of railways George Gair.
It notes his appointment to the executive of the Council of Trade Unions and reports his attendance at a May Day social organised by the CP at the Trade Union Centre in Christchurch on May 2, 1986. The report notes the gathering was entertained by a blind man playing an accordion and a tin
whistle.
Corliss is tracked attending a meeting of SUP in 1986 and in the same year is said not to have turned
up at a Committee for a Worker Front meeting where he was supposed to speak.The committee was trying to come up with a manifesto to provide an alternative to the Roger
Douglas reforms.
His file then notes his invitation to a seminar by SUP and an advertisement giving notice of his
intention to speak at a series of public forums on ‘‘reconquering the Labour Party or a new workers’
party’’.
Corliss, who has never been a member of a political party, says he is not overly perturbed at finding
– to his surprise – that he is the subject of an SIS file.
But he finds it bizarre he should ‘‘feature in some official secret source’’.
‘‘I mean, I wouldn’t feel like that if I had some guilt or something, but this is a bit odd,’’ he says. ‘‘All
I did was belong to legal organisations.’’
He was not a career railwayman, but ‘‘if I had been, it [the note about being a troublemaker] could
have been a major influence on my future’’.
‘‘It seems clear they were talking with senior management about me and Murray, and that would
have leaked like a sieve,’’ he says. ‘‘To say I was causing trouble was a sign I was doing my job as a representative. But there were thousands of union delegates around the country doing what democratic unions are allowed to do.’’
Here is an article that appeared in the Christchurch Press on Wednesday 28th January regarding the CAFCA SIS file.
SIS reveals secret files
Article 28 Jan 2009
The Press
Martin van Beynen
The release of Security Intelligence Service (SIS) files on individuals has revealed for the first time
how far the shadowy service reached into the lives of activist and non-activist New Zealanders.
In response to the SIS relaxing its approach to redundant files, the word has got out.
A flood of files is reaching the people spied on, with most of the clandestine reporting referring to
legitimate protest and political activity.
In November, Murray Horton, a former railway worker, applied for the file on the Campaign Against
Foreign Control of Aotearoa (Cafca), an organisation he helped found.
He received 400 documents, including a cover letter from SIS head Dr Wayne Tucker. It said the
spying had stopped.
The file presented a ‘‘fascinating and disturbing pattern of systematic covert state surveillance of
many, many organisations and many hundreds, if not thousands, of people over decades’’, Horton said.
He had seen other files. One showed the SIS had started monitoring an activist when she was 10.
An SIS spokesman said the service had adopted an archives policy in 2003 to aid ‘‘the proactive
declassification of historical records’’.
‘‘A key element of the archives policy is that the SIS will deal impartially with information, regardless
of whether it reflects unfavourably on the service or shows the service in a good light,’’ he said.
‘‘Subsequent publicity has led to an increase in requests for access to personal information . . . The
service has made every endeavour to be forthcoming.’’
The greater openness had been well-received, with 26 people being sent their personal files last year.
‘‘Recipients of declassified SIS reports have generally viewed them in their historical context and
realised that the service’s methods and informationcollection priorities have altered over the years as the
nature and perceptions of threats to security have changed.’’
The identity of agents and sources of information was deleted from the files, the spokesman said.
So much for democracy, Horton said.
‘‘Our own little country has been proven to behave towards its dissidents in much the same way as
the Communist police states that it used to rail against,’’ he said.
The worst of it was that the Cafca file and others released indiscreet and personally damaging
material about named third parties who were not the subject of the surveillance but simply caught up in
its net, he said.
‘‘A lot of it is salacious gossip, with analyses of named people’s marriage problems, drinking habits,
etc, etc,’’ Horton said.
‘‘Some of it is laughable, like a report dedicated to the likely impact of feminism and different gender
views on abortion on the marriages of named couples.’’
One report contained this reference to Horton: ‘‘He likes the sound of his own voice and keeps
interrupting the other speakers.’’
Bill Rosenberg, 57, who is a member of Cafca, told the Press he had received his personal file, some
of the file kept on his late father, Canterbury University economist Wolfgang Rosenberg, a refugee from
Nazi Germany, and also the file on his mother.
The deputy director of the centre for teaching and learning at Canterbury University said he had
never been a member of a political party but had been in several anti-war protest groups since his youth.
His father’s file showed he had been followed when he went around the country giving talks to
groups. His mother was also monitored because of her membership of the New Zealand Communist
Party in her youth and her involvement in organisations such as the Housewives Union.
His father’s application for a professorship at Victoria University was noted, and he wondered if the
SIS had intervened to ensure it failed.
The files reflected the paranoia of the McCarthy era but also the particular views of SIS staff,
Rosenberg said. ‘‘The release of the files marks a significant change in that degree of paranoia and that
view of the world.’’
His file contained mainly comments about him by Socialist Unity Party and Communist Party
members at private meetings. Most disturbing was the car registration numbers taken when people
visited his house after he had returned from overseas.
The picture emerging from the files was a ‘‘huge mixture of time-serving stuff’’ and reports about
innocuous events, Rosenberg said.
The lack of sophistication was startling and little analysis was done on why activities were suspicious.
The vast majority of reporting was about ‘‘perfectly legitimate political activity by people who had a
different view to the status quo’’, Rosenberg said.
SIS dossiers detail dalliances, dances and very little drama
Article rank 28 Jan 2009
The Press
Organisations and individuals throughout the country are finding out whythey
attracted the attention of the Security Intelligence Service as files no longer
regarded as live are released. MARTINVANBEYNENblows the dust off two
Christchurch files
Keeping files for the Security Intelligence Service (SIS) must have been a boring job. The file on the
Campaign Against Foreign Control of Aotearoa (Cafca, formerly Cafcinz, the Campaign Against Foreign
Control in New Zealand) contains about 400 mostly mundane documents, and goes back to its earlier
incarnation in 1965.
It consists mainly of newspaper clippings, Cafca publications and newsletters, press releases and
internal SIS memorandums providing reports on Cafca’s annual meetings. It also contains briefings to
the prime minister on Cafca and notes that some material was passed on to the United States
government.
Much of the information stems from the SIS’s District Office, Christchurch (DOC).
The SIS would not have needed to employ its full resources to garner the information. Most of it
would have been easily obtainable by subscription, and Cafca has always correctly assumed addresses
on its mailing list contained either post office boxes belonging to the SIS or the police Criminal
Intelligence Service.
SIS reports of meetings always identify the attendees, as do reports on pickets and protests. Other
happenings at such protests are recorded, including anti-government statements.
A record of a demonstration in 1980 notes an individual calling the government a ‘‘ripoff’’ and saying
the ‘‘Marxist way of life’’ was better.
Finances are often mentioned as links with other organisations.
By the mid-1980s, the SIS had almost lost interest in Cafca, regarding it as of ‘‘minimal security
interest’’.
A covering letter accompanying the released file by current SIS director Dr Warren Tucker says the
service would have been less interested in the organisation after 1977 if it had not continued with
protests against US bases and naval visits and with protests to abolish the SIS.
The SIS’s interest appears to have peaked in a period between 1975 and 1978 when Cafca or its
predecessor was involved in protests against the visit of US navy secretary J. W. Middendorf, the
berthing of Russian trawler Yunost at Lyttelton and the Pacific Basin Economic Council meeting in
Christchurch.
These followed the involvement of Cafca members in a protest and winning-hearts campaign called
the South Island Resistance Ride in 1975.
The Cafca file included a list of everyone on the ride, with their address and telephone number.
Preparations for the tour, such as ferry bookings, are documented.
The interest cranked up in 1976 when an attempt was made to sabotage a communications mast at
Weedons in Canterbury, and increased again in 1977 when seven .303 bullets were fired into an oil
tanker in protest against the visit of the US Union Oil chairman to the Pacific Basin meeting.
No evidence suggested any link with Cafca, but clearly it was strongly suspected, the file shows.
The prime minister was briefed on the organisation by then SIS director Paul Molineaux.
After skirmishes at the demonstration against the Pacific Basin meeting, the SIS notes on the file
appear to lament a ‘‘well-placed source’’ in Cafca who should have been able to ‘‘forewarn’’ the
authorities.
Although the file suggests a degree of infiltration of Cafca by the SIS by 1978, it did not go to the
trouble of planting a mole.
The main reason for the SIS’s curiosity about Cafca was the organisation’s suspected links and
shared personnel with the New Zealand Communist Party (CP), its youth arm, the Progressive Youth
Movement (PYM), the Socialist Unity Party of New Zealand (SUP) and various offshoots.
From the Cafca file it is clear the SIS had a mole within the Christchurch branch of the CP and as
early as 1975 the party source is reporting how the party regards Cafca as a good testing and recruiting
ground for converts.
The SIS took a much closer interest in CP members, which involved intercepting mail.
In 1986, its source reports on a meeting at which the perilous finances of the Christchurch branch are
discussed and the need to persuade Marion Lesley Hobbs (who later became a Labour Cabinet minister)
to pledge $10.
CP cadres did not always do Cafca any favours. In 1980, B, attending a CP meeting, is reported to
boast when drunk that Cafca had been responsible for the Weedons aerial sabotage on directions from
the CP. Cafca stalwart Murray Horton says the organisation was not involved.
The SIS expresses, in one memo, its satisfaction at the Cafca protest against the Russian trawler
visit, suggesting the protest would create a rift between Cafca and the ‘‘People’s Union’’.
The Cafca file, with its broad compass, contrasts with the file on Christchurch unionist Paul Corliss,
formerly the secretary of the Harbour Workers Union and convener of the Council of Trade Unions in
Canterbury. He is now a part-time union organiser.
He first came to the attention of the SIS in 1974 through his association with Horton and another
Cafca stalwart, Brian Rooney.
He worked with Horton as distribution manager for the Canterbury University student newspaper
Canta, and both men later worked in the traffic branch of New Zealand Railways in Christchurch.
Both are noted in Corliss’s file as ‘‘troublemakers to railways management’’.
Suspicions Corliss might be a member of SUP (he was never a member of the grouping) are also
noted. Corliss’s file tracks his rise up the ranks of the trade union movement and starts with his involvement
in the South Island Resistance Ride, for which he was in charge of food.
In the end, he could not be bothered going, he says.
His file mentions his attendance at a protest in 1980 in Lyttelton against the sale of coal to Japan and
also his arrest in a protest against the Springboks rugby tour in 1981.It records his promotion to Canterbury secretary of the National Union of Railwaymen and his part in a protest against minister of railways George Gair.
It notes his appointment to the executive of the Council of Trade Unions and reports his attendance at a May Day social organised by the CP at the Trade Union Centre in Christchurch on May 2, 1986. The report notes the gathering was entertained by a blind man playing an accordion and a tin
whistle.
Corliss is tracked attending a meeting of SUP in 1986 and in the same year is said not to have turned
up at a Committee for a Worker Front meeting where he was supposed to speak.The committee was trying to come up with a manifesto to provide an alternative to the Roger
Douglas reforms.
His file then notes his invitation to a seminar by SUP and an advertisement giving notice of his
intention to speak at a series of public forums on ‘‘reconquering the Labour Party or a new workers’
party’’.
Corliss, who has never been a member of a political party, says he is not overly perturbed at finding
– to his surprise – that he is the subject of an SIS file.
But he finds it bizarre he should ‘‘feature in some official secret source’’.
‘‘I mean, I wouldn’t feel like that if I had some guilt or something, but this is a bit odd,’’ he says. ‘‘All
I did was belong to legal organisations.’’
He was not a career railwayman, but ‘‘if I had been, it [the note about being a troublemaker] could
have been a major influence on my future’’.
‘‘It seems clear they were talking with senior management about me and Murray, and that would
have leaked like a sieve,’’ he says. ‘‘To say I was causing trouble was a sign I was doing my job as a representative. But there were thousands of union delegates around the country doing what democratic unions are allowed to do.’’
Election Analysis
Well since the last entry we've had an election and we now have a new Prime Minister. Following is the election analysis from Murray Horton to appear in the next issue of Foreign Control Watchdog.
HEEEERE’S JOHNNNY!
- Murray Horton
The definitive scene in Stanley Kubrick’s classic supernatural horror film “The Shining” was when the character played by Jack Nicholson has gone mad and is hunting his terrified family with an axe. He uses it to smash his way through the bathroom door and then sticks his insanely grinning face in to announce “Here’s Johnny!” (an ironic send up of the famous intro used at the start of his TV shows by US entertainment icon, Johnny Carson). That vivid visual image best encapsulates my reaction to National’s 2008 electoral victory, the closest possible to a landslide under MMP. Goodness, does that mean that I’m comparing nice smiley Johnny Key to a homicidal maniac? That remains to be seen but I have the uncomfortable feeling that we’re now sharing a small room with somebody who has an axe. To develop further the analogy with that wonderful movie – the axe murderer was driven mad by malevolent ghosts (and he ended up frozen to death in the snow). Well, there’s plenty of spooks and zombies in Key’s supporting cast of hacks, hasbeens and halfwits and I wouldn’t put it past them to shove our John out into the snow once he’s no further use to them. For a leader who campaigned on the platform of “a fresh face” and “change” (which is definitely the only similarity he can claim to Barack Obama), there’s a deadening look of sameness about the “new” National/Act government, not to mention Peter Dunne (pronounced Dunny) that sinkingshipjumpingrat par excellence.
Are New Zealanders Stupid?
Inevitably, following National’s comprehensive and long predicted victory there was an outpouring of rage and despair from some people. Most futile was the reaction to blame it on “stupid” New Zealanders. This is understandable but quite wrong. So, New Zealanders must have been “stupid” every time they voted in a National government (Piggy Muldoon anyone? Or the Bolger/Birch/Richardson version?). Come to think of it, they certainly must have been terminally bloody stupid to re-elect the 1980s Roger Douglas Labour government, if you subscribe to the stupidity theory of politics. And I have no doubt that Tory voters must have had the same “stupid bastards” reaction when their fellow citizens voted in, although not so often, Labour governments, even a Labour-Alliance government for all of three years (my late father - who voted National nearly all of his life until his final decade – was a great believer in the inherent stupidity of Labour voters. I grew up hearing the expression that “if Labour ran a red arsed baboon in Sydenham it would be elected”. In the case of John Kirk, he was dead right). But, tempting as it is, “stupidity” is not the reason and nor is it even worth seriously examining.
People vote the way they do (and change their allegiance) for a wide variety of reasons. A very small number, presumably the much less than 5% who voted for Act, want a far Right government with a prominent role for their undead messiah, Sir Roger Douglas. Moral conservatives would have voted against Labour for laws such as the deliberately mislabelled “anti-smacking” act, legalisation of prostitution, civil unions, etc, plus the carefully fostered perception that the Government was running a “politically correct nanny State”. This was the local version of the “culture wars” that have split American politics asunder for years (and continue to do so, as evidenced by the simultaneous votes in California for Obama and against gay marriage). “What’s in it for me?” a la tax cuts was definitely a factor and Labour fell into the trap of a bidding war on which party would cut taxes the most. The obvious contradiction between cutting taxes and reducing public services (while also promising a spend up on infrastructure, etc) shouldn’t take too long to emerge. And then the swinging voters will direct their anger at the National government, with the media full of stories of people whose Dear Old Mums have died while on the hospital waiting list.
Some others use their two votes tactically. To cite my late father again – naturally, he voted against MMP in the referendum that led to its introduction, but he then took to it with gusto and in the first MMP election, in 1996, he used his two votes to support National and Jim Anderton. If you accepted his political logic (I didn’t), it all made perfect sense (in the final two elections of his life, 1999 & 02, he reverted to voting Labour and Anderton, because National had become too free market and far Right for an old Muldoonist. And he admired Helen Clark as “our strongest Prime Minister since Piggy”).
But the vast majority of those who voted Labour out (and it’s worth remembering that 2008 saw the second lowest turnout in decades) did so for nothing more articulate than “it’s time for a change”. There was no deep visceral loathing of Helen Clark as there had been for Muldoon in 1984, and despite the inevitable scandals that trip up any Government and the problems with coalition partners that are a hallmark of MMP, they were nothing compared to their equivalents which saw the 1996-99 National government implode, dumping their Prime Minister and coalition partner along the way to electoral defeat. Labour ran its own most disciplined government ever, with unswerving loyalty to Clark and minimal problems (until the final few months) with its New Zealand First coalition partner. Key ran a very narrowly focused campaign from the moment he was elected National’s Leader which stressed how little he would change things from Labour (or, rather, he said that he wouldn’t. We’ll now find out if what he said and what he does are two very different things. It was exactly that two faced lying under the last Labour and National governments before MMP that saw it voted in as a new electoral system to stop that misrepresentation and arrogance of power). Basically people have voted for a change of face and a minimal change of policies, having been promised that there won’t be much deviation from what was business as usual under Labour.
Labour Was On Borrowed Time From 05
It needs to be remembered that Labour came very, very close to losing the 2005 election, which means that a substantial chunk of the electorate was sick of it a full three years before it went out. And that was when National was headed by Labour’s greatest asset, the fumbling, bumbling Don Brash with his openly declared far Right agenda. Labour’s fate was sealed when Nicky Hager’s 2006 book “The Hollow Men” delivered the coup de grace to Brash – after that, he was, in his own immortal phrase, gone by lunchtime – and National made a special effort to pick a new Leader whose central quality had to be that he wasn’t Don Brash (so, Nicky, if you’re reading this, it was all your fault). Personally, I regret that National didn’t stick with its previous Brash/Key leadership team, as I had the perfect collective name for them – DonKey.
Election night 05 was a real nailbiter, with Labour eventually emerging with a majority of one over National and then followed the usual tedious weeks of negotiations before a deal was stitched up with Winston Peters (which is why National, Act and their media mates made damned sure that he and his party were neutralised before the 08 election). Labour was at its apex in the 2002 election when they were given a dream run by National under Bill English running possibly the most inept campaign in New Zealand’s history, which led to National’s worst ever result (the only thing that I can remember Bill saying from that campaign was the immortal line “Oi loike poies” when filmed eating one. Good on you mate, so do I).
Labour harboured the conceit that it would win enough votes to govern alone in 2002 (the desire to be shot of all this MMP nonsense is also shared by National, which came much closer to being able to realise it in the 08 election) until it came a gutser because of that bloody Nicky Hager again and his earlier book "Seeds Of Distrust", which meticulously documented (as Nicky always does) the importation of genetically engineered-contaminated corn seeds into New Zealand by transnational corporations, the Government’s changing of the rules to retrospectively legalise that importation, and then concealing the fact that this corn was planted and harvested in the normal commercial manner. The book threw Clark completely off balance and publicly revealed a very ugly side of her personality. The Labour/Alliance government (remember the Alliance?) was caught out having covered up a very serious breach of New Zealand’s supposed GE free status, and Clark opted for the standard Muldoonist response – abuse and attack. The Greens lost votes and traction by not strongly picking up the explosive revelations in the book, instead seeming to regard it as an annoying distraction on their inevitable progress to Cabinet posts. "We didn’t know about it either" was their heartfelt plaint. Clark’s attacks put them firmly on the back foot and both parties suffered at the polls, as voters went elsewhere. But Labour still won easily, and repaid the Greens’ support by keeping them out of the resulting coalition (as they did for the full nine years they were in office).
So, effectively Labour had been on notice since at least 2005, if not earlier, that it was a Government on borrowed time and that its fate was sealed unless it could pull something out of the hat. National had already produced a fluffy white rabbit of its own, called John; from the moment he became National’s Leader, the media lauded him as the Chosen One and the polls gave him and National a lead which they never lost. It soon became clear that all that Labour could offer was to attack Key, in an eerie echo of the negative attack campaign on Barack Obama run by the other John, McCain, on behalf of the other incumbent party in the other election of 2008. To use the rugby analogy, it was a classic case of playing the man and not the ball. Even more damningly, it didn’t work.
I knew that Labour was buggered when, a fortnight out from election day, they were caught desperately trying to dig up 20 year old dirt from Key’s highly profitable career as a money trader (they found nothing and the accusations rebounded on them. Both Labour and the media didn’t dare raise the larger question that the money trading business in which Key made his fortune is basically a crime per se and has got the global economy into the mess that it is currently in. A Labour Party which has never renounced Rogernomics, only that Rogernomics is electoral poison, would never raise that fundamental question). To add insult to injury, just days out from the election, Helen Clark offered a formal coalition and Cabinet posts to the Greens, after stabbing them in the back and taking them for granted for nine years. She knew then that she and her Government were finished – her election night resignation as Party leader was no spontaneous gesture – so it was a totally empty offer.
Maori Party Are The New Cannon Fodder
So what can we expect from Key’s National government? He has gone to great efforts to stress that it will be Centre Right, with the emphasis on centrism. Getting the Maori Party into the coalition is a very clever tactic on his behalf and potentially marks a seismic shift in the NZ political landscape, with Maori maybe ending the alliance with Labour that had lasted since the 1930s. The Maori Party grew directly out of Maori in the Labour Party finally having had a gutsfull of decades of patronising neglect and being taken for granted, with the foreshore and seabed issue being the last straw. The dislike of Labour evidenced by Tariana Turia, Party Co-Leader and former Labour Cabinet Minister, is evident to all. But whether entering a coalition is as beneficial for the Maori Party as it is for National remains to be seen. In the seven Maori seats in the 2008 election, Labour easily won the party vote over both the Maori Party and National, so going into this coalition flies in the face of the great majority of Maori seat voters, who clearly backed Labour. And junior coalition partners are the ones who are used as cannon fodder by the Government. In 1996 New Zealand First swept all the Maori seats and entered into coalition with National, trumpeting itself as the replacement for Labour as the party for Maori, with Winston Peters as Treasurer. That lasted all of two years, before Peters was fired, the coalition ended, the party split and, in 1999, Labour won back all the Maori seats.
This National/Act/United Future/Maori coalition, with Ministerial posts outside Cabinet for the leaders of all three junior partners (but none for Sir Roger Douglas) is being touted as Key being able to use the Maori Party on the “Left” to neutralise Act on the Right. However it is a mistake to think of the Maori Party as being Left – it is very much a party based on race, not class (since the Alliance imploded and disappeared from Parliament at the 2002 election, there hasn’t been any truly class-based party in Parliament) and it has flirted with the Tories ever since it came into Parliament at the 05 election, including when National was under the far Right leadership of Don Brash. Key has promised to review the foreshore and seabed law (no big hassle, because National voted against it) and, in a major flipflop, has backed off his promise to abolish the Maori seats, which would destroy the Maori Party. This will lose Key support form the pakeha racists who flocked to National when Brash deliberately chose Maori bashing as a central policy, soaring in the polls as a result and forcing Labour to drop its policies which “discriminated in favour of Maori”. Whether this coalition lasts any longer than the fractious 1996-98 one which fatally wounded the last National government remains to be seen. And whether Maori seat voters punish the Maori Party for ignoring their 2008 overwhelming party vote for Labour will be a fascinating feature of the 2011 election. I have no doubt that National will happily use its new Maori Party Ministers to take the heat from its policies which will inevitably bash the poor (the “underclass” that Key highlighted when he first became National Leader; we haven’t heard so much about them from him since), of whom a disproportionate chunk are Maori.
How Many Ways Can You Spell Privatisation?
More specifically, what can CAFCA expect from National? Throughout 2007 and 08 Key was continually embarrassed by several of his senior colleagues, such as his Deputy, Bill English, and Maurice Williamson, blurting out a wish list – “sell Kiwibank, introduce toll roads”, etc, etc! Watchdog has regularly analysed this evidence of a hidden agenda of privatisation and user pays, those discredited relics of the 1980s and 90s (which is where National and Labour’s front benches cut their teeth). For example, see my article “Sharks In the Water. Privatisation Rears Its Ugly Head Again”, which was the cover story in Watchdog 118, August 2008, online at http://www.converge.org.nz/watchdog/18/01.htm. Key has pledged not to sell any public assets, such as Kiwibank or the newly renationalised KiwiRail in National’s first term – which, of course, leaves State assets wide open to be flogged off in any subsequent term (here’s hoping but there never has been a single term National government. For his compulsive desire to blurt out the truth, Maurice Williamson was punished by being left out of Key’s Cabinet).
In the first term, we can expect to see the wholesale introduction of public private partnerships (PPP) in infrastructure projects such as roading (Labour was enthusiastically going the same way); the partial opening up of ACC to competition by insurance transnational corporations (National says this isn’t privatisation), and much more private sector involvement right across the board but heavily in sectors such as health, education and welfare. The Resource Management Act will be diluted to make it more “business friendly” – it’s been a target of Big Business ever since its introduction. National is an even more rabid champion of the “open economy and globalisation”, meaning more unfettered foreign investment and free trade agreements, including the Holy Grail, one with the US (which Labour kicked off). The very first thing that Key did, as a sop to Act, was to delay (pending a review) the proposed carbon emissions trading scheme, although he was at pains to stress that NZ will not be backing away from our obligations under the Kyoto Treaty. Considering that Rodney Hide campaigned on the basis that global warming is a “hoax”, this is hardly surprising, but it makes NZ a flat Earth laughingstock to the rest of the world, to whom global warming is the biggest issue bar none.
In foreign policy, the close ties with the US that Labour worked so assiduously to repair will be strengthened. Barack Osama has pledged to get US troops out of Iraq (a war that Labour kept NZ out of; National would have gone in shoulder to shoulder with Bush) but only to redeploy them into Afghanistan, which he has proclaimed to be the American Empire’s “real war”. NZ already has troops in Afghanistan, primarily engaged in reconstruction in one comparatively peaceful province. Expect the US to “request” that its allies, such as NZ, commit front line troops to the intensified Afghan war and to support Obama’s reckless new emphasis on attacking into Pakistan (shades of the Vietnam War, where the US spread it across the border into both Cambodia and Laos – and lost in all three countries).
One consolation for Labour is that if you it had to lose an election, this was definitely the best one to lose. The global and domestic economy are in freefall, it’s the biggest crisis in capitalism since the 1930s Great Depression and it’s all entirely manmade, created by the truly gargantuan greed and stupidity of the finance capitalists who captured the system and milked it dry for their own immense profit. I’m touched by the naïve faith that some people have expressed in John Key, who became a multi-millionaire as a wheeler dealer in that very same financial market, as the best leader during a time of unprecedented crisis in that market. Yes, he made a fortune but only by using money to make money; he’s never made anything or run anything whatsoever in the real economy (defined as things that you can drop on your foot). It is the money men who have got global capitalism into the current mess, why would anyone think that a money man will know how to get little old New Zealand out of it? We’re a long way from the rest of the world and the tsunami which is drowning it has not yet reached us – but rest assured that it’s on the way. A Prime Minister presiding over an economy in recession, maybe even depression, with rapidly growing unemployment and every other negative symptom that will accompany capitalism’s biggest bust in nearly a century, is going to have a very rough time of it as the people take it out on the Government.
Let’s See If Key Lasts The Distance As Prime Minister
He is National’s main asset, because of his inoffensive personality and his (public) willingness in the election buildup to say or do anything that would ensure that National got into power. But plenty in his own party, let alone his Rightwing coalition partner and Big Business and the transnational corporate media, are angered by his whole series of flipflops, his selling of National as “Labour lite”. There are plenty of unreconstructed Rogernauts (including dear old Sir Roger himself, of course) in National and Act, who entertain fantasies about “finishing the business”, whose standard denial of reality for the past two decades has been that if only they’d been able to inflict more pain there would have been some gain. They belong to “the operation was a great success, the patient died” school of politics and economics. At the same time as the rest of the world is suddenly rediscovering the essential role of the State - and taxpayers’ money - in saving capitalism from itself, and even the US has taken a step to the Left (but only in US terms), New Zealand now has a Government committed to the market forces bullshit that got us (and the world) into this mess. What exquisite timing! To refresh your memories about who these people are that are operating in National’s shadows, read Jeremy Agar’s review of the 2008 documentary “The Hollow Men” in Watchdog 1118, August 2008, online at http://www.converge.org.nz/watchdog/18/08.htm.
If the far Right gets sufficiently sick of Key for being insufficiently politically correct, they will simply dump him. It’s what the Jenny Shipley faction did to Jim Bolger in the late 90s, when National was last in power; it’s what the Rogernauts did to David Lange when his Labour government was tearing itself apart in the late 80s. Rogernomics was rushed through, in direct contradiction to Labour’s 1984 election manifesto, in response to a “financial crisis”; Richardson’s Ruthanasia, likewise, was rushed through in direct contradiction to National’s 1990 election promises, and in response to another “financial crisis’. There really is a financial crisis this time, a global one, and the old Rogernauts must be twitching to slash and burn, which is all they know how to do, in order “to save us”.
Actually there is one wild card factor that could consign National to being a one term government. In 1999, Jenny Shipley, in all seriousness, reckoned that the All Blacks crashing out of the Rugby World Cup impacted badly on her Government in that year’s election (if they’d won, she said that National would have benefitted from the feel good factor). The 2011 election coincides with NZ hosting the World Cup. If the All Blacks crash out yet again, and at home, the national mood will be ugly (New Zealanders get much more passionate about rugby than politics). The public, who will be looking for someone to blame, don’t get a vote for the Rugby Union bosses or the All Blacks’ coach, so they’ll stick it up the Government which, doubtless, will have taken every opportunity to bask in the reflected glory of NZ being the host nation. If I was National’s strategist, I would call an early election and get it out of the way before the World Cup, which has the potential for a major emotional backlash showing up at the polls if the All Blacks crap out again (I hasten to add though that I, as a lifelong rugby fan who has been known to react badly to the All Blacks abysmal history at the World Cup, will not be voting National under any circumstances and certainly not because I might be “feeling good” if they actually win the bloody thing at long last).
Labour’s Ad Hoc Legacy
What is Labour’s legacy after nine years in power, their longest time in office since the 1940s? Indisputably it did many good things. To take my own personal situation, as one example. Very recently I had to re-read and edit an oral history interview that I did way back in March 2004. In it I mentioned that my pay was about to be increased to $9 per hour, as that was to be the new minimum wage. I am now paid $14 per hour and the minimum wage is now $12 an hour. It’s not that many years ago that I was on $7 an hour. The minimum wage, which was never once increased during National’s nine years in power in the 90s, has been steadily increased under Labour, which also did many other things to improve workers’ conditions (ranging from introducing four weeks annual leave to abolishing the nightmarish Employment Contracts Act). Innovations such as Working For Families and Kiwisaver are positive moves and so popular that National has had to commit to keeping them. The controversial “social engineering” laws, such as those legalising prostitution and civil unions, and banning the use of “unreasonable” force on kids are all landmarks in NZ becoming a more civilised society (I am fully aware that there will be CAFCA members who disagree with me about this, so I stress that it is my personal opinion. CAFCA does not have a policy on such matters, they are not our issue, and the committee has never discussed them).
CAFCA, of course, does have opinions and policies on our issue and we were only too happy to publicly congratulate the Government for decisions such as staying out of the American-led criminal invasion and occupation of Iraq to stopping the sale of Auckland Airport; renationalising ACC, Air New Zealand and the railways; and creating Kiwibank – to name a few. All of these have been analysed in Watchdog over the past nine years, so I won’t go over them again, check them out at the Watchdog Website www.converge.org.nz/watchdog.
But too many of those moves were one offs, reluctant, populist kneejerk reactions to a crisis (such as the spectacular collapse of Air NZ) and/or the need to appear progressive in election year – both of which were factors in the decision to renationalise the railways. To give the most recent example – the last time CAFCA congratulated the Labour government was for its October 2008 decision to spend $40 million to buy the St James Station in the South Island high country for the explicit reason of stopping it falling into foreign ownership. I put out a press release (which the media picked up) saying: “This proves that its 2005 Overseas Investment Act is not working. At the time that was touted as affording protection to ‘iconic’ land. The Government obviously doesn’t trust its own law to do that when it opted to spend $40 million to buy St James. In fact, all that Act does is put up a few more hoops for foreign buyers to jump through but it doesn’t actually stop them buying land, iconic or otherwise. There is a simpler, and much cheaper, solution than ad hoc multi-million dollar purchases to prevent NZ land being sold overseas – institute a legal regime that much more severely restricts foreign ownership of land, or ban it outright. That is the logical conclusion of what the Government has done in the case of St James Station and we call upon it to admit that and put such a regime in place as soon as possible” (9/10/08, “Helen. Don’t Just Stop At Saving St James Station From Foreign Ownership”).
Party Of Globalisation, Foreign Investment And Free Trade
And there’s the nub of the problem – Labour’s heart was never in being a genuinely progressive, Left government. It called itself Centre-Left but it was much more Centre than Left and plenty of its ideology and policies tilted to the Right. It never veered from the politically correct championing of “the open economy, market forces, foreign investment, globalisation and free trade”. Just days before the 1999 election the doomed National government increased the threshold required for Overseas Investment Commission (now the Overseas Investment Office) consent from $10 million to $50 million. As soon as Labour won that election, we lobbied all Labour, Alliance and Green MPs urging them to roll that back. We got nowhere with Labour and that threshold has never been rolled back (it now stands at $100 million and the original draft of Michael Cullen’s 2005 Overseas Investment Act aimed to increase it to $250 million; Treasury wanted no threshold at all). By contrast, the Alliance and Greens were much more sympathetic and also happy to take up CAFCA’s offer of a briefing on the wider issue of foreign control (I went to Wellington to brief the Green caucus; Bill Rosenberg did likewise with the Alliance). In its nine years in power there was only one Labour MP prepared to be briefed by CAFCA – namely Tim Barnett, the former MP for Christchurch Central. Tim was also happy to meet with the Anti-Bases Campaign on several occasions re the Waihopai spybase (once taking part in an ABC overnight national strategy meeting in Marlborough on the subject) and his office played an invaluable role in getting a visa for Cora Fabros from the Philippines, whom ABC toured through NZ in July 08. It is an indictment of Helen Clark that she never made Tim a Minister. He was also our very good local MP for the whole time Labour was in power (boundary changes mean that we are now in another electorate, my third in the 26 years I’ve lived in the same house). He retired at the 08 election and although Labour Party social gatherings are not my natural habitat I made a point of going to his farewell party a couple of days after it, representing CAFCA and ABC, to thank him on behalf of both groups (and on behalf of my own family for things that he’d done for us).
Labour’s “legacy” on the issue of foreign control is that 2005 Overseas Investment Act. Every issue of Watchdog from 2003-05 inclusive carried a cover story about it, so I won’t go over it again, refresh your memory at the Watchdog Website. Labour was equally wedded to the “free trade” religion and, in September 2008, after negotiating a series of bilateral and multilateral agreements (to circumvent the abject failure of the World Trade Organisation to agree on the Doha Round) it excitedly announced the Holy Grail was in sight – namely the prospect of a Free Trade Agreement with the US via an extension of the existing P4 Agreement (full title: Trans-Pacific Strategic Economic Partnership). Check out www.nznotforsale.org for details. At Tim Barnett’s farewell party an outgoing Minister sought me out and told me what we need now is a Multilateral Agreement on Investment (do you remember the monumental and successful late 90s’ global campaign against the MAI?) but this time for the benefit of nation states against the transnational corporations. Interesting idea - but we didn’t hear a peep about it when the Minister was in power for nine years and it’s too late now. Perhaps CAFCA could ask National if we could brief their MPs about it.
As for foreign policy: Labour prided itself in “rebuilding“ the alliance with the US, sucking up to the war criminal Bush and his cronies. Yes, NZ stayed out of Iraq but it enthusiastically plunged into the Afghanistan War and the “War On Terror” – Ahmed Zaoui was NZ’s unique contribution to that chamber of horrors. The covert State of spies and spybases, such as Waihopai, had no more passionate champion than Helen Clark. And now that’s she’s abruptly gone Labour is headed by Phil Goff who, as Minister of Trade Negotiations, trumpeted that one of the greatest benefits of a US Free Trade Agreement would be that NZ businesses could get their snouts into the trough of US military contracts (he specifically singled out the big money to be made in the US Pacific territory of Guam, preparing infrastructure for the relocation of US Marines from Okinawa in Japan, where massive anti-bases protests over many years have forced the US and Japanese governments to make some concessions to overwhelming public opinion). Goff has been personally affected by the “War on Terror” – his nephew, serving in the US military, is the only New Zealander to have been killed in Afghanistan. Yes, it was a terrible tragedy for the family but the Rightwing media sickeningly milked this for all it was worth, for the propaganda value of New Zealand “doing its bit”.
It Has Never Renounced The Ideology Of Rogernomics
Labour’s shortcomings in the area of foreign control need to be seen in the context of Labour’s overall ideology, one which hasn’t changed very much since the 1980s. Its 1999-08 front bench was full of veterans of the Rogernomics years and the new leadership team of Phil Goff and Annette King doesn’t signal any change from that. Labour was decimated in the 1990s as voters punished it for that madness, so it recognises Rogernomics as electoral poison but it has never actually renounced the ideology. Sir Roger Douglas has always taunted his old party that it has never repealed any of the laws that form the central tenets of Rogernomics and he is correct – they never have. As soon as Labour ran into the “business backlash” in its first year in office it backed off any suggestion of such change (workers are severely constrained in their legal ability to strike, but the mere threat of a capital strike by Big Business was enough to pull the Government into line). At best, they put a kinder face on the more brutal features of Rogernomics.
Labour never restored welfare benefits to the levels they were at before Ruth Richardson’s 1991 slashing cuts. Hundreds of thousands of kids remain in poverty and State “housing” for those at the bottom of the heap in Auckland was exposed as an outrage in many cases. Even some of the achievements that Labour boasted about, such as Kiwibank and four weeks leave were actually the work of minor parties (Jim Anderton fought hard to get Kiwibank established; initially, Clark and Cullen sneered at the idea and damned it with faint praise when it began). It went to great lengths to keep the Greens out of any coalition for the full nine years, opting instead for Winston Peters and Peter Dunne.
To conclude, Labour had a great chance to be a genuine progressive Left government, to substantially right the wrongs of the 1980s and 90s, but it let that slide, because its heart was not in it, fundamentally it has long been a party whose sole motivation is getting into, and holding onto, power. The rest of it is just means to that end. Labour has never had any doubt as to whom it is beholden, and it isn’t ordinary working New Zealanders. The party will spend at least the next three years working out how to more attractively package itself as the best party to administer capitalism, so that it’s ready when the public next decides to vote for “change”.
Winston Peters Out: Greens More Necessary Than Ever
New Zealand First can justifiably feel hard done by that it secured more party votes than Act but is out of Parliament, whereas Act, by virtue of Rodney Hide holding one electorate seat, gets five MPs, Ministers and a coalition with National. Hide and the media ran a very successful smear campaign against Peters, targeting him as a key prospective coalition partner of Labour and hence to be eliminated at all costs. It worked. None of the various serious allegations were proven but the mud stuck. Did Peters deserve it? Absolutely, because there was definitely fire with this smoke, and his arrogance and contempt in refusing to respond to the charges were what sank him. Despite his superficial nationalism and populism (which he rolled out whenever convenient, and always in election years, and which tapped into an ugly undercurrent of racism) CAFCA didn’t trust him or his party as far as we could throw them (which has proven to be right out of Parliament). We made our position clear on Winston Peters way back in the 1990s when he got into bed as National’s coalition partner and promptly turned his back on all the “nationalist” issues that he’d campaigned about. There have been suggestions that billionaire Owen Glenn was the modern day equivalent of the shonky “financiers” used to get rid of the Whitlam Labor government in Australia in the 1970s and to very nearly get rid of the Lange Labour government here in the 80s (remember the Maori Loans scandal, which was traced back to the US Central Intelligence Agency?). But I reject that comparison. Why would the CIA want to get rid of a Minister of Foreign Affairs who made it his central policy to suck up to the Bush regime? And why would the US want to destabilise a Government which proved itself a valuable ally in so many ways? Nope, Winston was finally undone by his own glaring contradictions, both personal and political.
The Greens confounded those who thought that Rod Donald’s tragic death just after the 2005 election would prove them to be a one man band. They actually increased their share of the party vote and got more MPs as a result. They now have nine MPs, which equals their best result (1999, when they first came into Parliament in their own right, having previously been part of the former Alliance). They can truly claim to be the only real MMP party in that their Parliamentary existence is entirely dependent on getting above the 5% party vote barrier, with no electorate seat safety net to fall back on (Act used to claim that it was the only real MMP party but its negligible share of the party vote means that it is now entirely dependent on Hide retaining his electorate seat). The Greens have carved out a niche in the NZ political spectrum (albeit one that has never managed to attract 10% of the vote in any election, sometimes hovering perilously close to 5%) and in the absence of any real Leftwing party in Parliament, their continued presence is vital. I admire their forbearance as they continue to go it alone after being rejected and used as a doormat by Labour for nine years. And Green MPs, particularly the likes of Keith Locke, are prepared to play a full role in the parliament of the streets, in the campaigns of all manner of activist groups (for many years now Keith has played an active role at the Waihopai spybase protests organised by the Anti-Bases Campaign). In that aspect alone, they provide a conspicuous contrast to MPs of the other parties.
From my perspective as a political activist, having a National government in power makes my job easier, as they are the traditional enemy. All the people who hibernate during Labour governments because “we musn’t do anything to help National get into power” suddenly rediscover their activist zeal when it does. This Tory government is headed by a smiley faced, seemingly inoffensive sort of fellow (he’s obviously studied how Tony Blair projected himself), who has started off with some tactically clever “inclusive” moves. But it won’t take long for National, let alone Act, to revert to type. Then watch the old proverbial hit the fan (and for the Maori Party to cop the most splatter). We are in for interesting times and CAFCA will be in the thick of it.
HEEEERE’S JOHNNNY!
- Murray Horton
The definitive scene in Stanley Kubrick’s classic supernatural horror film “The Shining” was when the character played by Jack Nicholson has gone mad and is hunting his terrified family with an axe. He uses it to smash his way through the bathroom door and then sticks his insanely grinning face in to announce “Here’s Johnny!” (an ironic send up of the famous intro used at the start of his TV shows by US entertainment icon, Johnny Carson). That vivid visual image best encapsulates my reaction to National’s 2008 electoral victory, the closest possible to a landslide under MMP. Goodness, does that mean that I’m comparing nice smiley Johnny Key to a homicidal maniac? That remains to be seen but I have the uncomfortable feeling that we’re now sharing a small room with somebody who has an axe. To develop further the analogy with that wonderful movie – the axe murderer was driven mad by malevolent ghosts (and he ended up frozen to death in the snow). Well, there’s plenty of spooks and zombies in Key’s supporting cast of hacks, hasbeens and halfwits and I wouldn’t put it past them to shove our John out into the snow once he’s no further use to them. For a leader who campaigned on the platform of “a fresh face” and “change” (which is definitely the only similarity he can claim to Barack Obama), there’s a deadening look of sameness about the “new” National/Act government, not to mention Peter Dunne (pronounced Dunny) that sinkingshipjumpingrat par excellence.
Are New Zealanders Stupid?
Inevitably, following National’s comprehensive and long predicted victory there was an outpouring of rage and despair from some people. Most futile was the reaction to blame it on “stupid” New Zealanders. This is understandable but quite wrong. So, New Zealanders must have been “stupid” every time they voted in a National government (Piggy Muldoon anyone? Or the Bolger/Birch/Richardson version?). Come to think of it, they certainly must have been terminally bloody stupid to re-elect the 1980s Roger Douglas Labour government, if you subscribe to the stupidity theory of politics. And I have no doubt that Tory voters must have had the same “stupid bastards” reaction when their fellow citizens voted in, although not so often, Labour governments, even a Labour-Alliance government for all of three years (my late father - who voted National nearly all of his life until his final decade – was a great believer in the inherent stupidity of Labour voters. I grew up hearing the expression that “if Labour ran a red arsed baboon in Sydenham it would be elected”. In the case of John Kirk, he was dead right). But, tempting as it is, “stupidity” is not the reason and nor is it even worth seriously examining.
People vote the way they do (and change their allegiance) for a wide variety of reasons. A very small number, presumably the much less than 5% who voted for Act, want a far Right government with a prominent role for their undead messiah, Sir Roger Douglas. Moral conservatives would have voted against Labour for laws such as the deliberately mislabelled “anti-smacking” act, legalisation of prostitution, civil unions, etc, plus the carefully fostered perception that the Government was running a “politically correct nanny State”. This was the local version of the “culture wars” that have split American politics asunder for years (and continue to do so, as evidenced by the simultaneous votes in California for Obama and against gay marriage). “What’s in it for me?” a la tax cuts was definitely a factor and Labour fell into the trap of a bidding war on which party would cut taxes the most. The obvious contradiction between cutting taxes and reducing public services (while also promising a spend up on infrastructure, etc) shouldn’t take too long to emerge. And then the swinging voters will direct their anger at the National government, with the media full of stories of people whose Dear Old Mums have died while on the hospital waiting list.
Some others use their two votes tactically. To cite my late father again – naturally, he voted against MMP in the referendum that led to its introduction, but he then took to it with gusto and in the first MMP election, in 1996, he used his two votes to support National and Jim Anderton. If you accepted his political logic (I didn’t), it all made perfect sense (in the final two elections of his life, 1999 & 02, he reverted to voting Labour and Anderton, because National had become too free market and far Right for an old Muldoonist. And he admired Helen Clark as “our strongest Prime Minister since Piggy”).
But the vast majority of those who voted Labour out (and it’s worth remembering that 2008 saw the second lowest turnout in decades) did so for nothing more articulate than “it’s time for a change”. There was no deep visceral loathing of Helen Clark as there had been for Muldoon in 1984, and despite the inevitable scandals that trip up any Government and the problems with coalition partners that are a hallmark of MMP, they were nothing compared to their equivalents which saw the 1996-99 National government implode, dumping their Prime Minister and coalition partner along the way to electoral defeat. Labour ran its own most disciplined government ever, with unswerving loyalty to Clark and minimal problems (until the final few months) with its New Zealand First coalition partner. Key ran a very narrowly focused campaign from the moment he was elected National’s Leader which stressed how little he would change things from Labour (or, rather, he said that he wouldn’t. We’ll now find out if what he said and what he does are two very different things. It was exactly that two faced lying under the last Labour and National governments before MMP that saw it voted in as a new electoral system to stop that misrepresentation and arrogance of power). Basically people have voted for a change of face and a minimal change of policies, having been promised that there won’t be much deviation from what was business as usual under Labour.
Labour Was On Borrowed Time From 05
It needs to be remembered that Labour came very, very close to losing the 2005 election, which means that a substantial chunk of the electorate was sick of it a full three years before it went out. And that was when National was headed by Labour’s greatest asset, the fumbling, bumbling Don Brash with his openly declared far Right agenda. Labour’s fate was sealed when Nicky Hager’s 2006 book “The Hollow Men” delivered the coup de grace to Brash – after that, he was, in his own immortal phrase, gone by lunchtime – and National made a special effort to pick a new Leader whose central quality had to be that he wasn’t Don Brash (so, Nicky, if you’re reading this, it was all your fault). Personally, I regret that National didn’t stick with its previous Brash/Key leadership team, as I had the perfect collective name for them – DonKey.
Election night 05 was a real nailbiter, with Labour eventually emerging with a majority of one over National and then followed the usual tedious weeks of negotiations before a deal was stitched up with Winston Peters (which is why National, Act and their media mates made damned sure that he and his party were neutralised before the 08 election). Labour was at its apex in the 2002 election when they were given a dream run by National under Bill English running possibly the most inept campaign in New Zealand’s history, which led to National’s worst ever result (the only thing that I can remember Bill saying from that campaign was the immortal line “Oi loike poies” when filmed eating one. Good on you mate, so do I).
Labour harboured the conceit that it would win enough votes to govern alone in 2002 (the desire to be shot of all this MMP nonsense is also shared by National, which came much closer to being able to realise it in the 08 election) until it came a gutser because of that bloody Nicky Hager again and his earlier book "Seeds Of Distrust", which meticulously documented (as Nicky always does) the importation of genetically engineered-contaminated corn seeds into New Zealand by transnational corporations, the Government’s changing of the rules to retrospectively legalise that importation, and then concealing the fact that this corn was planted and harvested in the normal commercial manner. The book threw Clark completely off balance and publicly revealed a very ugly side of her personality. The Labour/Alliance government (remember the Alliance?) was caught out having covered up a very serious breach of New Zealand’s supposed GE free status, and Clark opted for the standard Muldoonist response – abuse and attack. The Greens lost votes and traction by not strongly picking up the explosive revelations in the book, instead seeming to regard it as an annoying distraction on their inevitable progress to Cabinet posts. "We didn’t know about it either" was their heartfelt plaint. Clark’s attacks put them firmly on the back foot and both parties suffered at the polls, as voters went elsewhere. But Labour still won easily, and repaid the Greens’ support by keeping them out of the resulting coalition (as they did for the full nine years they were in office).
So, effectively Labour had been on notice since at least 2005, if not earlier, that it was a Government on borrowed time and that its fate was sealed unless it could pull something out of the hat. National had already produced a fluffy white rabbit of its own, called John; from the moment he became National’s Leader, the media lauded him as the Chosen One and the polls gave him and National a lead which they never lost. It soon became clear that all that Labour could offer was to attack Key, in an eerie echo of the negative attack campaign on Barack Obama run by the other John, McCain, on behalf of the other incumbent party in the other election of 2008. To use the rugby analogy, it was a classic case of playing the man and not the ball. Even more damningly, it didn’t work.
I knew that Labour was buggered when, a fortnight out from election day, they were caught desperately trying to dig up 20 year old dirt from Key’s highly profitable career as a money trader (they found nothing and the accusations rebounded on them. Both Labour and the media didn’t dare raise the larger question that the money trading business in which Key made his fortune is basically a crime per se and has got the global economy into the mess that it is currently in. A Labour Party which has never renounced Rogernomics, only that Rogernomics is electoral poison, would never raise that fundamental question). To add insult to injury, just days out from the election, Helen Clark offered a formal coalition and Cabinet posts to the Greens, after stabbing them in the back and taking them for granted for nine years. She knew then that she and her Government were finished – her election night resignation as Party leader was no spontaneous gesture – so it was a totally empty offer.
Maori Party Are The New Cannon Fodder
So what can we expect from Key’s National government? He has gone to great efforts to stress that it will be Centre Right, with the emphasis on centrism. Getting the Maori Party into the coalition is a very clever tactic on his behalf and potentially marks a seismic shift in the NZ political landscape, with Maori maybe ending the alliance with Labour that had lasted since the 1930s. The Maori Party grew directly out of Maori in the Labour Party finally having had a gutsfull of decades of patronising neglect and being taken for granted, with the foreshore and seabed issue being the last straw. The dislike of Labour evidenced by Tariana Turia, Party Co-Leader and former Labour Cabinet Minister, is evident to all. But whether entering a coalition is as beneficial for the Maori Party as it is for National remains to be seen. In the seven Maori seats in the 2008 election, Labour easily won the party vote over both the Maori Party and National, so going into this coalition flies in the face of the great majority of Maori seat voters, who clearly backed Labour. And junior coalition partners are the ones who are used as cannon fodder by the Government. In 1996 New Zealand First swept all the Maori seats and entered into coalition with National, trumpeting itself as the replacement for Labour as the party for Maori, with Winston Peters as Treasurer. That lasted all of two years, before Peters was fired, the coalition ended, the party split and, in 1999, Labour won back all the Maori seats.
This National/Act/United Future/Maori coalition, with Ministerial posts outside Cabinet for the leaders of all three junior partners (but none for Sir Roger Douglas) is being touted as Key being able to use the Maori Party on the “Left” to neutralise Act on the Right. However it is a mistake to think of the Maori Party as being Left – it is very much a party based on race, not class (since the Alliance imploded and disappeared from Parliament at the 2002 election, there hasn’t been any truly class-based party in Parliament) and it has flirted with the Tories ever since it came into Parliament at the 05 election, including when National was under the far Right leadership of Don Brash. Key has promised to review the foreshore and seabed law (no big hassle, because National voted against it) and, in a major flipflop, has backed off his promise to abolish the Maori seats, which would destroy the Maori Party. This will lose Key support form the pakeha racists who flocked to National when Brash deliberately chose Maori bashing as a central policy, soaring in the polls as a result and forcing Labour to drop its policies which “discriminated in favour of Maori”. Whether this coalition lasts any longer than the fractious 1996-98 one which fatally wounded the last National government remains to be seen. And whether Maori seat voters punish the Maori Party for ignoring their 2008 overwhelming party vote for Labour will be a fascinating feature of the 2011 election. I have no doubt that National will happily use its new Maori Party Ministers to take the heat from its policies which will inevitably bash the poor (the “underclass” that Key highlighted when he first became National Leader; we haven’t heard so much about them from him since), of whom a disproportionate chunk are Maori.
How Many Ways Can You Spell Privatisation?
More specifically, what can CAFCA expect from National? Throughout 2007 and 08 Key was continually embarrassed by several of his senior colleagues, such as his Deputy, Bill English, and Maurice Williamson, blurting out a wish list – “sell Kiwibank, introduce toll roads”, etc, etc! Watchdog has regularly analysed this evidence of a hidden agenda of privatisation and user pays, those discredited relics of the 1980s and 90s (which is where National and Labour’s front benches cut their teeth). For example, see my article “Sharks In the Water. Privatisation Rears Its Ugly Head Again”, which was the cover story in Watchdog 118, August 2008, online at http://www.converge.org.nz/watchdog/18/01.htm. Key has pledged not to sell any public assets, such as Kiwibank or the newly renationalised KiwiRail in National’s first term – which, of course, leaves State assets wide open to be flogged off in any subsequent term (here’s hoping but there never has been a single term National government. For his compulsive desire to blurt out the truth, Maurice Williamson was punished by being left out of Key’s Cabinet).
In the first term, we can expect to see the wholesale introduction of public private partnerships (PPP) in infrastructure projects such as roading (Labour was enthusiastically going the same way); the partial opening up of ACC to competition by insurance transnational corporations (National says this isn’t privatisation), and much more private sector involvement right across the board but heavily in sectors such as health, education and welfare. The Resource Management Act will be diluted to make it more “business friendly” – it’s been a target of Big Business ever since its introduction. National is an even more rabid champion of the “open economy and globalisation”, meaning more unfettered foreign investment and free trade agreements, including the Holy Grail, one with the US (which Labour kicked off). The very first thing that Key did, as a sop to Act, was to delay (pending a review) the proposed carbon emissions trading scheme, although he was at pains to stress that NZ will not be backing away from our obligations under the Kyoto Treaty. Considering that Rodney Hide campaigned on the basis that global warming is a “hoax”, this is hardly surprising, but it makes NZ a flat Earth laughingstock to the rest of the world, to whom global warming is the biggest issue bar none.
In foreign policy, the close ties with the US that Labour worked so assiduously to repair will be strengthened. Barack Osama has pledged to get US troops out of Iraq (a war that Labour kept NZ out of; National would have gone in shoulder to shoulder with Bush) but only to redeploy them into Afghanistan, which he has proclaimed to be the American Empire’s “real war”. NZ already has troops in Afghanistan, primarily engaged in reconstruction in one comparatively peaceful province. Expect the US to “request” that its allies, such as NZ, commit front line troops to the intensified Afghan war and to support Obama’s reckless new emphasis on attacking into Pakistan (shades of the Vietnam War, where the US spread it across the border into both Cambodia and Laos – and lost in all three countries).
One consolation for Labour is that if you it had to lose an election, this was definitely the best one to lose. The global and domestic economy are in freefall, it’s the biggest crisis in capitalism since the 1930s Great Depression and it’s all entirely manmade, created by the truly gargantuan greed and stupidity of the finance capitalists who captured the system and milked it dry for their own immense profit. I’m touched by the naïve faith that some people have expressed in John Key, who became a multi-millionaire as a wheeler dealer in that very same financial market, as the best leader during a time of unprecedented crisis in that market. Yes, he made a fortune but only by using money to make money; he’s never made anything or run anything whatsoever in the real economy (defined as things that you can drop on your foot). It is the money men who have got global capitalism into the current mess, why would anyone think that a money man will know how to get little old New Zealand out of it? We’re a long way from the rest of the world and the tsunami which is drowning it has not yet reached us – but rest assured that it’s on the way. A Prime Minister presiding over an economy in recession, maybe even depression, with rapidly growing unemployment and every other negative symptom that will accompany capitalism’s biggest bust in nearly a century, is going to have a very rough time of it as the people take it out on the Government.
Let’s See If Key Lasts The Distance As Prime Minister
He is National’s main asset, because of his inoffensive personality and his (public) willingness in the election buildup to say or do anything that would ensure that National got into power. But plenty in his own party, let alone his Rightwing coalition partner and Big Business and the transnational corporate media, are angered by his whole series of flipflops, his selling of National as “Labour lite”. There are plenty of unreconstructed Rogernauts (including dear old Sir Roger himself, of course) in National and Act, who entertain fantasies about “finishing the business”, whose standard denial of reality for the past two decades has been that if only they’d been able to inflict more pain there would have been some gain. They belong to “the operation was a great success, the patient died” school of politics and economics. At the same time as the rest of the world is suddenly rediscovering the essential role of the State - and taxpayers’ money - in saving capitalism from itself, and even the US has taken a step to the Left (but only in US terms), New Zealand now has a Government committed to the market forces bullshit that got us (and the world) into this mess. What exquisite timing! To refresh your memories about who these people are that are operating in National’s shadows, read Jeremy Agar’s review of the 2008 documentary “The Hollow Men” in Watchdog 1118, August 2008, online at http://www.converge.org.nz/watchdog/18/08.htm.
If the far Right gets sufficiently sick of Key for being insufficiently politically correct, they will simply dump him. It’s what the Jenny Shipley faction did to Jim Bolger in the late 90s, when National was last in power; it’s what the Rogernauts did to David Lange when his Labour government was tearing itself apart in the late 80s. Rogernomics was rushed through, in direct contradiction to Labour’s 1984 election manifesto, in response to a “financial crisis”; Richardson’s Ruthanasia, likewise, was rushed through in direct contradiction to National’s 1990 election promises, and in response to another “financial crisis’. There really is a financial crisis this time, a global one, and the old Rogernauts must be twitching to slash and burn, which is all they know how to do, in order “to save us”.
Actually there is one wild card factor that could consign National to being a one term government. In 1999, Jenny Shipley, in all seriousness, reckoned that the All Blacks crashing out of the Rugby World Cup impacted badly on her Government in that year’s election (if they’d won, she said that National would have benefitted from the feel good factor). The 2011 election coincides with NZ hosting the World Cup. If the All Blacks crash out yet again, and at home, the national mood will be ugly (New Zealanders get much more passionate about rugby than politics). The public, who will be looking for someone to blame, don’t get a vote for the Rugby Union bosses or the All Blacks’ coach, so they’ll stick it up the Government which, doubtless, will have taken every opportunity to bask in the reflected glory of NZ being the host nation. If I was National’s strategist, I would call an early election and get it out of the way before the World Cup, which has the potential for a major emotional backlash showing up at the polls if the All Blacks crap out again (I hasten to add though that I, as a lifelong rugby fan who has been known to react badly to the All Blacks abysmal history at the World Cup, will not be voting National under any circumstances and certainly not because I might be “feeling good” if they actually win the bloody thing at long last).
Labour’s Ad Hoc Legacy
What is Labour’s legacy after nine years in power, their longest time in office since the 1940s? Indisputably it did many good things. To take my own personal situation, as one example. Very recently I had to re-read and edit an oral history interview that I did way back in March 2004. In it I mentioned that my pay was about to be increased to $9 per hour, as that was to be the new minimum wage. I am now paid $14 per hour and the minimum wage is now $12 an hour. It’s not that many years ago that I was on $7 an hour. The minimum wage, which was never once increased during National’s nine years in power in the 90s, has been steadily increased under Labour, which also did many other things to improve workers’ conditions (ranging from introducing four weeks annual leave to abolishing the nightmarish Employment Contracts Act). Innovations such as Working For Families and Kiwisaver are positive moves and so popular that National has had to commit to keeping them. The controversial “social engineering” laws, such as those legalising prostitution and civil unions, and banning the use of “unreasonable” force on kids are all landmarks in NZ becoming a more civilised society (I am fully aware that there will be CAFCA members who disagree with me about this, so I stress that it is my personal opinion. CAFCA does not have a policy on such matters, they are not our issue, and the committee has never discussed them).
CAFCA, of course, does have opinions and policies on our issue and we were only too happy to publicly congratulate the Government for decisions such as staying out of the American-led criminal invasion and occupation of Iraq to stopping the sale of Auckland Airport; renationalising ACC, Air New Zealand and the railways; and creating Kiwibank – to name a few. All of these have been analysed in Watchdog over the past nine years, so I won’t go over them again, check them out at the Watchdog Website www.converge.org.nz/watchdog.
But too many of those moves were one offs, reluctant, populist kneejerk reactions to a crisis (such as the spectacular collapse of Air NZ) and/or the need to appear progressive in election year – both of which were factors in the decision to renationalise the railways. To give the most recent example – the last time CAFCA congratulated the Labour government was for its October 2008 decision to spend $40 million to buy the St James Station in the South Island high country for the explicit reason of stopping it falling into foreign ownership. I put out a press release (which the media picked up) saying: “This proves that its 2005 Overseas Investment Act is not working. At the time that was touted as affording protection to ‘iconic’ land. The Government obviously doesn’t trust its own law to do that when it opted to spend $40 million to buy St James. In fact, all that Act does is put up a few more hoops for foreign buyers to jump through but it doesn’t actually stop them buying land, iconic or otherwise. There is a simpler, and much cheaper, solution than ad hoc multi-million dollar purchases to prevent NZ land being sold overseas – institute a legal regime that much more severely restricts foreign ownership of land, or ban it outright. That is the logical conclusion of what the Government has done in the case of St James Station and we call upon it to admit that and put such a regime in place as soon as possible” (9/10/08, “Helen. Don’t Just Stop At Saving St James Station From Foreign Ownership”).
Party Of Globalisation, Foreign Investment And Free Trade
And there’s the nub of the problem – Labour’s heart was never in being a genuinely progressive, Left government. It called itself Centre-Left but it was much more Centre than Left and plenty of its ideology and policies tilted to the Right. It never veered from the politically correct championing of “the open economy, market forces, foreign investment, globalisation and free trade”. Just days before the 1999 election the doomed National government increased the threshold required for Overseas Investment Commission (now the Overseas Investment Office) consent from $10 million to $50 million. As soon as Labour won that election, we lobbied all Labour, Alliance and Green MPs urging them to roll that back. We got nowhere with Labour and that threshold has never been rolled back (it now stands at $100 million and the original draft of Michael Cullen’s 2005 Overseas Investment Act aimed to increase it to $250 million; Treasury wanted no threshold at all). By contrast, the Alliance and Greens were much more sympathetic and also happy to take up CAFCA’s offer of a briefing on the wider issue of foreign control (I went to Wellington to brief the Green caucus; Bill Rosenberg did likewise with the Alliance). In its nine years in power there was only one Labour MP prepared to be briefed by CAFCA – namely Tim Barnett, the former MP for Christchurch Central. Tim was also happy to meet with the Anti-Bases Campaign on several occasions re the Waihopai spybase (once taking part in an ABC overnight national strategy meeting in Marlborough on the subject) and his office played an invaluable role in getting a visa for Cora Fabros from the Philippines, whom ABC toured through NZ in July 08. It is an indictment of Helen Clark that she never made Tim a Minister. He was also our very good local MP for the whole time Labour was in power (boundary changes mean that we are now in another electorate, my third in the 26 years I’ve lived in the same house). He retired at the 08 election and although Labour Party social gatherings are not my natural habitat I made a point of going to his farewell party a couple of days after it, representing CAFCA and ABC, to thank him on behalf of both groups (and on behalf of my own family for things that he’d done for us).
Labour’s “legacy” on the issue of foreign control is that 2005 Overseas Investment Act. Every issue of Watchdog from 2003-05 inclusive carried a cover story about it, so I won’t go over it again, refresh your memory at the Watchdog Website. Labour was equally wedded to the “free trade” religion and, in September 2008, after negotiating a series of bilateral and multilateral agreements (to circumvent the abject failure of the World Trade Organisation to agree on the Doha Round) it excitedly announced the Holy Grail was in sight – namely the prospect of a Free Trade Agreement with the US via an extension of the existing P4 Agreement (full title: Trans-Pacific Strategic Economic Partnership). Check out www.nznotforsale.org for details. At Tim Barnett’s farewell party an outgoing Minister sought me out and told me what we need now is a Multilateral Agreement on Investment (do you remember the monumental and successful late 90s’ global campaign against the MAI?) but this time for the benefit of nation states against the transnational corporations. Interesting idea - but we didn’t hear a peep about it when the Minister was in power for nine years and it’s too late now. Perhaps CAFCA could ask National if we could brief their MPs about it.
As for foreign policy: Labour prided itself in “rebuilding“ the alliance with the US, sucking up to the war criminal Bush and his cronies. Yes, NZ stayed out of Iraq but it enthusiastically plunged into the Afghanistan War and the “War On Terror” – Ahmed Zaoui was NZ’s unique contribution to that chamber of horrors. The covert State of spies and spybases, such as Waihopai, had no more passionate champion than Helen Clark. And now that’s she’s abruptly gone Labour is headed by Phil Goff who, as Minister of Trade Negotiations, trumpeted that one of the greatest benefits of a US Free Trade Agreement would be that NZ businesses could get their snouts into the trough of US military contracts (he specifically singled out the big money to be made in the US Pacific territory of Guam, preparing infrastructure for the relocation of US Marines from Okinawa in Japan, where massive anti-bases protests over many years have forced the US and Japanese governments to make some concessions to overwhelming public opinion). Goff has been personally affected by the “War on Terror” – his nephew, serving in the US military, is the only New Zealander to have been killed in Afghanistan. Yes, it was a terrible tragedy for the family but the Rightwing media sickeningly milked this for all it was worth, for the propaganda value of New Zealand “doing its bit”.
It Has Never Renounced The Ideology Of Rogernomics
Labour’s shortcomings in the area of foreign control need to be seen in the context of Labour’s overall ideology, one which hasn’t changed very much since the 1980s. Its 1999-08 front bench was full of veterans of the Rogernomics years and the new leadership team of Phil Goff and Annette King doesn’t signal any change from that. Labour was decimated in the 1990s as voters punished it for that madness, so it recognises Rogernomics as electoral poison but it has never actually renounced the ideology. Sir Roger Douglas has always taunted his old party that it has never repealed any of the laws that form the central tenets of Rogernomics and he is correct – they never have. As soon as Labour ran into the “business backlash” in its first year in office it backed off any suggestion of such change (workers are severely constrained in their legal ability to strike, but the mere threat of a capital strike by Big Business was enough to pull the Government into line). At best, they put a kinder face on the more brutal features of Rogernomics.
Labour never restored welfare benefits to the levels they were at before Ruth Richardson’s 1991 slashing cuts. Hundreds of thousands of kids remain in poverty and State “housing” for those at the bottom of the heap in Auckland was exposed as an outrage in many cases. Even some of the achievements that Labour boasted about, such as Kiwibank and four weeks leave were actually the work of minor parties (Jim Anderton fought hard to get Kiwibank established; initially, Clark and Cullen sneered at the idea and damned it with faint praise when it began). It went to great lengths to keep the Greens out of any coalition for the full nine years, opting instead for Winston Peters and Peter Dunne.
To conclude, Labour had a great chance to be a genuine progressive Left government, to substantially right the wrongs of the 1980s and 90s, but it let that slide, because its heart was not in it, fundamentally it has long been a party whose sole motivation is getting into, and holding onto, power. The rest of it is just means to that end. Labour has never had any doubt as to whom it is beholden, and it isn’t ordinary working New Zealanders. The party will spend at least the next three years working out how to more attractively package itself as the best party to administer capitalism, so that it’s ready when the public next decides to vote for “change”.
Winston Peters Out: Greens More Necessary Than Ever
New Zealand First can justifiably feel hard done by that it secured more party votes than Act but is out of Parliament, whereas Act, by virtue of Rodney Hide holding one electorate seat, gets five MPs, Ministers and a coalition with National. Hide and the media ran a very successful smear campaign against Peters, targeting him as a key prospective coalition partner of Labour and hence to be eliminated at all costs. It worked. None of the various serious allegations were proven but the mud stuck. Did Peters deserve it? Absolutely, because there was definitely fire with this smoke, and his arrogance and contempt in refusing to respond to the charges were what sank him. Despite his superficial nationalism and populism (which he rolled out whenever convenient, and always in election years, and which tapped into an ugly undercurrent of racism) CAFCA didn’t trust him or his party as far as we could throw them (which has proven to be right out of Parliament). We made our position clear on Winston Peters way back in the 1990s when he got into bed as National’s coalition partner and promptly turned his back on all the “nationalist” issues that he’d campaigned about. There have been suggestions that billionaire Owen Glenn was the modern day equivalent of the shonky “financiers” used to get rid of the Whitlam Labor government in Australia in the 1970s and to very nearly get rid of the Lange Labour government here in the 80s (remember the Maori Loans scandal, which was traced back to the US Central Intelligence Agency?). But I reject that comparison. Why would the CIA want to get rid of a Minister of Foreign Affairs who made it his central policy to suck up to the Bush regime? And why would the US want to destabilise a Government which proved itself a valuable ally in so many ways? Nope, Winston was finally undone by his own glaring contradictions, both personal and political.
The Greens confounded those who thought that Rod Donald’s tragic death just after the 2005 election would prove them to be a one man band. They actually increased their share of the party vote and got more MPs as a result. They now have nine MPs, which equals their best result (1999, when they first came into Parliament in their own right, having previously been part of the former Alliance). They can truly claim to be the only real MMP party in that their Parliamentary existence is entirely dependent on getting above the 5% party vote barrier, with no electorate seat safety net to fall back on (Act used to claim that it was the only real MMP party but its negligible share of the party vote means that it is now entirely dependent on Hide retaining his electorate seat). The Greens have carved out a niche in the NZ political spectrum (albeit one that has never managed to attract 10% of the vote in any election, sometimes hovering perilously close to 5%) and in the absence of any real Leftwing party in Parliament, their continued presence is vital. I admire their forbearance as they continue to go it alone after being rejected and used as a doormat by Labour for nine years. And Green MPs, particularly the likes of Keith Locke, are prepared to play a full role in the parliament of the streets, in the campaigns of all manner of activist groups (for many years now Keith has played an active role at the Waihopai spybase protests organised by the Anti-Bases Campaign). In that aspect alone, they provide a conspicuous contrast to MPs of the other parties.
From my perspective as a political activist, having a National government in power makes my job easier, as they are the traditional enemy. All the people who hibernate during Labour governments because “we musn’t do anything to help National get into power” suddenly rediscover their activist zeal when it does. This Tory government is headed by a smiley faced, seemingly inoffensive sort of fellow (he’s obviously studied how Tony Blair projected himself), who has started off with some tactically clever “inclusive” moves. But it won’t take long for National, let alone Act, to revert to type. Then watch the old proverbial hit the fan (and for the Maori Party to cop the most splatter). We are in for interesting times and CAFCA will be in the thick of it.
Article in Time Magazine
End of the Toll Road?
By Roy Eccleston
The financial alchemists at Macquarie Group, Australia's biggest investment bank, never managed to turn lead into gold, but they hit on the next best thing: turning asphalt into cash. In May, the bank's shareholders welcomed a $1.3 billion profit, thanks largely to a new way of looking at highways, airports and power stations.
The idea behind the Macquarie model is to borrow a lot of money cheaply, buy infrastructure assets with a guaranteed cash flow, then sell those assets to the public, letting shareholders take over the debt. Macquarie and imitators like Australia's Babcock & Brown make money at every step, with fees for the deal, for advice, and for managing the assets. Macquarie runs toll roads in America, bridges in Portugal, French autoroutes, a tunnel in Germany, and airports from Sydney to Copenhagen. About 290 million people ride its buses each year, and 17 million light its gas.
For investors, all this looked good, because roads and bridges with little competition should produce a steady return via tolls for generations. But with asset prices falling and easy debt a thing of the past, some believe the Macquarie model is in for a shakeup. JP Morgan's Brian Johnson says it is "likely dead."
Macquarie insists that its distributions to shareholders are paid strictly from cash, but other analysts say they're often funded by new rounds of refinancing. Steve Johnson, a former Macquarie staffer turned financial adviser, says the bank has managed to borrow ever-rising sums against its assets because "credit markets were more and more willing to lend. That game is over."
Macquarie's investments are much broader than infrastructure, and new CEO Nicholas Moore argues that with little exposure to Wall Street's problems and $14 billion in cash, the bank can easily refinance debts. The recent credit crunch, however, has made the market cautious. On Oct. 14 Macquarie Group's shares were trading at around $24 ($A35), two-thirds off their peak of $85 in May 2007. And Babcock & Brown had tumbled from around $28 to $1.20.
B&B runs $55 billion worth of infrastructure assets, including ports in Britain, an Irish phone company, real estate across Italy, France, Germany and Japan, a fleet of jets, Australian gas, American rail stock, even a telecom cable under San Francisco Bay. Now the credit crunch is forcing it to sell off assets to cut its debt, estimated to total $35 billion.
"They built their house on the beach," says Tim Morris, an analyst with stockbroker WiseOwl.com. "Now that the storms have come, they can't help but watch their house subside into the ocean." And Macquarie? More diverse sources of revenue mean "it's better built to weather the storm," Morris says. But the borrow-to-buy infrastructure model "is dead in the water."
High debt levels aren't the only problem with the Macquarie-model funds, according to a tough review by corporate governance service RiskMetrics. It found that the funds also pay too much for assets and charge too much in fees, and that their operations lack transparency. "Our real concern is disclosure," says director Dean Paatsch. "The investment funds are asset vehicles that have outsourced 100% of the assets' management to a third-party company, but the terms � are not known."
Paatsch says that in the current market turmoil, the lack of such information erodes confidence. Investors whose shares in a fund lose most of their value would normally want to sack the manager, but with the Mac model, "you don't know what your options are." In the case of B&B Power, for example, "if you sack the manager you'd end up in the ridiculous situation where you'd pay them 25 years' worth of management fees — that's crazy." The review also noted that the funds are allowed to act in ways that normal companies are not, paying dividends, for example, from capital or borrowings rather than profit.
In B&B's case, warnings had been sounded for some time, including from inside the company. In an internal memo published in Australia's Fairfax newspapers in August, a disgruntled executive complained of a "culture of greed." In other companies, he wrote, "acquired projects are actually required to generate a certain benchmark return before bonus payouts take place. Instead, we have created an environment where senior people are rewarded for ... ginning up rosy projections to justify their rewards.''
B&B says it's got the message that it needs to change, but it doesn't agree the Mac model is dead. It is sacking a quarter of its 1,600 staff and selling off assets like Spanish wind farms and a Tasmanian power station. New CEO Michael Larkin says deals will be curtailed and executive pay based solidly on "investment outcomes." It remains to be seen if those remedies have come in time to save the patient.
By Roy Eccleston
The financial alchemists at Macquarie Group, Australia's biggest investment bank, never managed to turn lead into gold, but they hit on the next best thing: turning asphalt into cash. In May, the bank's shareholders welcomed a $1.3 billion profit, thanks largely to a new way of looking at highways, airports and power stations.
The idea behind the Macquarie model is to borrow a lot of money cheaply, buy infrastructure assets with a guaranteed cash flow, then sell those assets to the public, letting shareholders take over the debt. Macquarie and imitators like Australia's Babcock & Brown make money at every step, with fees for the deal, for advice, and for managing the assets. Macquarie runs toll roads in America, bridges in Portugal, French autoroutes, a tunnel in Germany, and airports from Sydney to Copenhagen. About 290 million people ride its buses each year, and 17 million light its gas.
For investors, all this looked good, because roads and bridges with little competition should produce a steady return via tolls for generations. But with asset prices falling and easy debt a thing of the past, some believe the Macquarie model is in for a shakeup. JP Morgan's Brian Johnson says it is "likely dead."
Macquarie insists that its distributions to shareholders are paid strictly from cash, but other analysts say they're often funded by new rounds of refinancing. Steve Johnson, a former Macquarie staffer turned financial adviser, says the bank has managed to borrow ever-rising sums against its assets because "credit markets were more and more willing to lend. That game is over."
Macquarie's investments are much broader than infrastructure, and new CEO Nicholas Moore argues that with little exposure to Wall Street's problems and $14 billion in cash, the bank can easily refinance debts. The recent credit crunch, however, has made the market cautious. On Oct. 14 Macquarie Group's shares were trading at around $24 ($A35), two-thirds off their peak of $85 in May 2007. And Babcock & Brown had tumbled from around $28 to $1.20.
B&B runs $55 billion worth of infrastructure assets, including ports in Britain, an Irish phone company, real estate across Italy, France, Germany and Japan, a fleet of jets, Australian gas, American rail stock, even a telecom cable under San Francisco Bay. Now the credit crunch is forcing it to sell off assets to cut its debt, estimated to total $35 billion.
"They built their house on the beach," says Tim Morris, an analyst with stockbroker WiseOwl.com. "Now that the storms have come, they can't help but watch their house subside into the ocean." And Macquarie? More diverse sources of revenue mean "it's better built to weather the storm," Morris says. But the borrow-to-buy infrastructure model "is dead in the water."
High debt levels aren't the only problem with the Macquarie-model funds, according to a tough review by corporate governance service RiskMetrics. It found that the funds also pay too much for assets and charge too much in fees, and that their operations lack transparency. "Our real concern is disclosure," says director Dean Paatsch. "The investment funds are asset vehicles that have outsourced 100% of the assets' management to a third-party company, but the terms � are not known."
Paatsch says that in the current market turmoil, the lack of such information erodes confidence. Investors whose shares in a fund lose most of their value would normally want to sack the manager, but with the Mac model, "you don't know what your options are." In the case of B&B Power, for example, "if you sack the manager you'd end up in the ridiculous situation where you'd pay them 25 years' worth of management fees — that's crazy." The review also noted that the funds are allowed to act in ways that normal companies are not, paying dividends, for example, from capital or borrowings rather than profit.
In B&B's case, warnings had been sounded for some time, including from inside the company. In an internal memo published in Australia's Fairfax newspapers in August, a disgruntled executive complained of a "culture of greed." In other companies, he wrote, "acquired projects are actually required to generate a certain benchmark return before bonus payouts take place. Instead, we have created an environment where senior people are rewarded for ... ginning up rosy projections to justify their rewards.''
B&B says it's got the message that it needs to change, but it doesn't agree the Mac model is dead. It is sacking a quarter of its 1,600 staff and selling off assets like Spanish wind farms and a Tasmanian power station. New CEO Michael Larkin says deals will be curtailed and executive pay based solidly on "investment outcomes." It remains to be seen if those remedies have come in time to save the patient.
Submissions called for on Free Trade Agreement with the US - get in quick - they close on December 8th
Submissions called for on FTA with US
(Submissions close on December 8)
Press Release by New Zealand Government at 3:13 pm, 15 Oct 2008
The Government is inviting submissions on New Zealand's upcoming FreeTrade Agreement negotiations with the United States as part of theTrans-Pacific Partnership (currently called the P4), Trade Minister PhilGoff said today.
The negotiations were announced in New York on 22 September, following ameeting between Mr Goff, United States Trade Representative Susan Schwaband trade ministers from Singapore, Chile and Brunei (the other P4countries)."The US is the world's largest economy, with more than 270 millionconsumers with a very high average income, notwithstanding recenteconomic difficulties," Phil Goff said."It is New Zealand's second largest export market. Total trade with theUS in the year to June 2008 was worth $8.14 billion, accounting for 9.6per cent of New Zealand's overall total trade. That means this deal isof huge significance to New Zealand.
"An American study on the impact of an FTA with the US, the BergstenReport, published in 2002, estimates that New Zealand exports to the USwould rise by $1 billion."That figure is indicative only. With its membership likely to expandfurther, the Trans-Pacific Partnership will likely bring much greaterbenefit for New Zealand and the US. The strategic benefits to the US should win bipartisan support for the agreement and ensure that it isboth high quality and comprehensive in nature."
In the current world economic climate, improving market access for Kiwiexporters, and the boost to growth, jobs and confidence that thisprovides, makes this negotiation and proposed agreement criticallyimportant."The more favourable New Zealand exchange rate will also boost exporterconfidence. New Zealand's export future however, relies not on cheapnessbut on quality and innovation."Essential to this is the encouragement of research and developmentpromoted by both Labour's 15 per cent tax credit for R and D and the$700 million Fast Forward Fund for the primary sector."National's promise to eliminate these policies is incomprehensible,"Phil Goff said.
"Our major exports to the US, dairy and meat, will benefit significantlythrough the removal of export quotas."Horticultural exports to the US worth $370 million last year currentlyface tariffs of up to 23 per cent. They will also be significantbeneficiaries."Fish and seafood, industrial products, metal products, wood, pulp andpaper account for more than $1.5 billion in New Zealand exports to theUS.These too will be able to trade into the US at lower cost."New Zealand companies will also be able to bid for US Governmentprocurement contracts, worth an estimated $200 billion a year."One example of facilitating new opportunities for New Zealand exportersis in the US Territory of Guam, where US Marines are transferring tofrom Okinawa over the next five years. This involves contracts of around$14 billion for work such as building and support services around thenew base.
An FTA with the US could allow New Zealand companies to bid directly forDefense Department projects."Our high tech companies will also benefit. Christchurch-based TaitElectronics last week welcomed the advantages an FTA with the US wouldbring, allowing them to bid for US Government contracts, currentlyblocked under the Buy American Act."Tait said this would greatly reduce the time and effort taken to meetUS regulations to export its radio equipment into the US. It would alsoallow it to bring its manufacturing base back from Texas to NewZealand," Phil Goff said."Public submissions are an essential part of a consultation process thatwill take place as the negotiations proceed.
The negotiations are due tobegin in March 2009, and are expected to be completed within 12 to 24months," Phil Goff said.Background to the negotiations and an online submission form areavailable on the Ministry of Foreign Affairs and Trade Website,mfat.govt.nz.
(Submissions close on December 8)
Press Release by New Zealand Government at 3:13 pm, 15 Oct 2008
The Government is inviting submissions on New Zealand's upcoming FreeTrade Agreement negotiations with the United States as part of theTrans-Pacific Partnership (currently called the P4), Trade Minister PhilGoff said today.
The negotiations were announced in New York on 22 September, following ameeting between Mr Goff, United States Trade Representative Susan Schwaband trade ministers from Singapore, Chile and Brunei (the other P4countries)."The US is the world's largest economy, with more than 270 millionconsumers with a very high average income, notwithstanding recenteconomic difficulties," Phil Goff said."It is New Zealand's second largest export market. Total trade with theUS in the year to June 2008 was worth $8.14 billion, accounting for 9.6per cent of New Zealand's overall total trade. That means this deal isof huge significance to New Zealand.
"An American study on the impact of an FTA with the US, the BergstenReport, published in 2002, estimates that New Zealand exports to the USwould rise by $1 billion."That figure is indicative only. With its membership likely to expandfurther, the Trans-Pacific Partnership will likely bring much greaterbenefit for New Zealand and the US. The strategic benefits to the US should win bipartisan support for the agreement and ensure that it isboth high quality and comprehensive in nature."
In the current world economic climate, improving market access for Kiwiexporters, and the boost to growth, jobs and confidence that thisprovides, makes this negotiation and proposed agreement criticallyimportant."The more favourable New Zealand exchange rate will also boost exporterconfidence. New Zealand's export future however, relies not on cheapnessbut on quality and innovation."Essential to this is the encouragement of research and developmentpromoted by both Labour's 15 per cent tax credit for R and D and the$700 million Fast Forward Fund for the primary sector."National's promise to eliminate these policies is incomprehensible,"Phil Goff said.
"Our major exports to the US, dairy and meat, will benefit significantlythrough the removal of export quotas."Horticultural exports to the US worth $370 million last year currentlyface tariffs of up to 23 per cent. They will also be significantbeneficiaries."Fish and seafood, industrial products, metal products, wood, pulp andpaper account for more than $1.5 billion in New Zealand exports to theUS.These too will be able to trade into the US at lower cost."New Zealand companies will also be able to bid for US Governmentprocurement contracts, worth an estimated $200 billion a year."One example of facilitating new opportunities for New Zealand exportersis in the US Territory of Guam, where US Marines are transferring tofrom Okinawa over the next five years. This involves contracts of around$14 billion for work such as building and support services around thenew base.
An FTA with the US could allow New Zealand companies to bid directly forDefense Department projects."Our high tech companies will also benefit. Christchurch-based TaitElectronics last week welcomed the advantages an FTA with the US wouldbring, allowing them to bid for US Government contracts, currentlyblocked under the Buy American Act."Tait said this would greatly reduce the time and effort taken to meetUS regulations to export its radio equipment into the US. It would alsoallow it to bring its manufacturing base back from Texas to NewZealand," Phil Goff said."Public submissions are an essential part of a consultation process thatwill take place as the negotiations proceed.
The negotiations are due tobegin in March 2009, and are expected to be completed within 12 to 24months," Phil Goff said.Background to the negotiations and an online submission form areavailable on the Ministry of Foreign Affairs and Trade Website,mfat.govt.nz.
CAFCA Press Release
HELEN. DON’T JUST STOP AT SAVING ST JAMES STATION FROM FOREIGN OWNERSHIP
The Campaign Against Foreign of Aotearoa (CAFCA) congratulates the Government for buying the St James Station for the explicit purpose of keeping it from falling into foreign ownership.
This proves that its 2005 Overseas Investment Act is not working. At the time that was touted as affording protection to “iconic” land. The Government obviously doesn’t trust its own law to do that when it opted to spend $40 million to buy St James. In fact, all that Act does is put up a few more hoops for foreign buyers to jump through but it doesn’t actually stop them buying land, iconic or otherwise.
There is a simpler, and much cheaper, solution than ad hoc multi-million dollar purchases to prevent NZ land being sold overseas – institute a legal regime that much more severely restricts foreign ownership of land, or ban it outright. That is the logical conclusion of what the Government has done in the case of St James Station and we call upon it to admit that and put such a regime in place as soon as possible.
The Campaign Against Foreign of Aotearoa (CAFCA) congratulates the Government for buying the St James Station for the explicit purpose of keeping it from falling into foreign ownership.
This proves that its 2005 Overseas Investment Act is not working. At the time that was touted as affording protection to “iconic” land. The Government obviously doesn’t trust its own law to do that when it opted to spend $40 million to buy St James. In fact, all that Act does is put up a few more hoops for foreign buyers to jump through but it doesn’t actually stop them buying land, iconic or otherwise.
There is a simpler, and much cheaper, solution than ad hoc multi-million dollar purchases to prevent NZ land being sold overseas – institute a legal regime that much more severely restricts foreign ownership of land, or ban it outright. That is the logical conclusion of what the Government has done in the case of St James Station and we call upon it to admit that and put such a regime in place as soon as possible.
US Free Trade Agreement - CAFCA Press Release
US FREE TRADE AGREEMENT A POISONED CHALICE FOR NZ
The proposed expansion of the Trans-Pacific Strategic Economic Partnership (NZ, Chile, Brunei, and Singapore, commonly known as the P4 Agreement) to include investment and financial services, and to add the US to its membership, was bad enough.
For a succinct, detailed critique of that original proposal, go to http://nznotforsale.wordpress.com/danger-ahead/ on the New Zealand Not For Sale Website.
But for this to suddenly morph into a fullblown Free Trade Agreement with the US is catastrophic for any remaining economic sovereignty that New Zealand has. We say this not because we are “anti-American”. All such FTAs – such as with China, or the existing P4 partners, for instance - pose the same threat to a greater or lesser degree. And our opposition to them is not because of “xenophobia” but for well founded grounds that they simply enmesh NZ more and more tightly in a cobweb of transnational corporate control.
So it’s a recipe for disaster to enter into an FTA with the biggest economy in the world, headed by a Government that aggressively pushes the interests of American Big Business (there is a seamless flow between the US Government and US Big Business, as is evidenced by the current trillion dollar bailout of the mega-greedy financial sector, a textbook example of socialism for the rich).
A full blown US FTA will:
Remove any remaining “restrictions” on foreign investment, as the US regards NZ’s (purely token) oversight regime as “discriminating” against US transnational corporations
push up the price of medicines by potentially hundreds of millions of dollars a year by attacking Pharmac;
make access to digital recordings more expensive, and copying more restricted;
attack our GE controls and food labelling,
weaken our controls on food imports where they might carry diseases.
Both Labour and National myopically see a US FTA as being the Holy Grail of their adherence to the cargo cult of “free trade”. It’s actually a poisoned chalice and it will be New Zealand which will be poisoned by it.
The proposed expansion of the Trans-Pacific Strategic Economic Partnership (NZ, Chile, Brunei, and Singapore, commonly known as the P4 Agreement) to include investment and financial services, and to add the US to its membership, was bad enough.
For a succinct, detailed critique of that original proposal, go to http://nznotforsale.wordpress.com/danger-ahead/ on the New Zealand Not For Sale Website.
But for this to suddenly morph into a fullblown Free Trade Agreement with the US is catastrophic for any remaining economic sovereignty that New Zealand has. We say this not because we are “anti-American”. All such FTAs – such as with China, or the existing P4 partners, for instance - pose the same threat to a greater or lesser degree. And our opposition to them is not because of “xenophobia” but for well founded grounds that they simply enmesh NZ more and more tightly in a cobweb of transnational corporate control.
So it’s a recipe for disaster to enter into an FTA with the biggest economy in the world, headed by a Government that aggressively pushes the interests of American Big Business (there is a seamless flow between the US Government and US Big Business, as is evidenced by the current trillion dollar bailout of the mega-greedy financial sector, a textbook example of socialism for the rich).
A full blown US FTA will:
Remove any remaining “restrictions” on foreign investment, as the US regards NZ’s (purely token) oversight regime as “discriminating” against US transnational corporations
push up the price of medicines by potentially hundreds of millions of dollars a year by attacking Pharmac;
make access to digital recordings more expensive, and copying more restricted;
attack our GE controls and food labelling,
weaken our controls on food imports where they might carry diseases.
Both Labour and National myopically see a US FTA as being the Holy Grail of their adherence to the cargo cult of “free trade”. It’s actually a poisoned chalice and it will be New Zealand which will be poisoned by it.
More on the Spybase
Waihopai spybase - it's not all bad
The spy base at Waihopai has certainly generated its fair share of controversy over the years. About 30km outside Blenheim on the Waihopai Valley Road, the base, with its two white globes, has stood in the Waihopai Valley since 1989, writes The Marlborough Express in an editorial.
The Waihopai spy base is operated by New Zealand's Government Communications Security Bureau. Exactly what goes on at the base is not 100 percent clear but its two satellite interception dishes (shielded from public view by giant domes) are said to intercept a huge volume of telexes, faxes, emails and computer data communications. Opponents of the base believe it is part of Echelon, the worldwide network of signals interception facilities run by the American and British intelligence agencies.
They do not want New Zealand to be part of Uncle Sam's spy network, and were particularly fired up by revelations found in former prime minister David Lange's papers that this country spied on friendly countries in the 1980s.
Anti-base campaigners say the base's existence makes New Zealand complicit in America's wars. Some say it is the key contribution New Zealand makes to any American war anywhere in the world, and leaves New Zealand with blood on its hands. It also places an unreasonable burden on New Zealand taxpayers, who have paid about half a billion dollars in the last 20 years.
The spy base has been the site of protests over many years. Every year it is the venue for an annual protest that sees a group of protesters stand around outside its gates with placards, yelling slogans and generally just expressing their displeasure at the base.
The base attracted international attention on April 30 when three sickle-wielding protesters broke on to the site and deflated one of the large inflatable domes covering a radar dish. The men were members of Ploughshares, a London-based movement which delivers its disarmament message by attempting to disable warplanes and other military equipment.
The group describes itself as "people committed to peace and disarmament and who nonviolently, safely, openly and accountably disable a war machine or system so that it can no longer harm people". Whether the Waihopai spy base can truly be called a "war machine" or whether it really "harms people" is debatable.
The Waihopai Satellite Communications Station is part of a signals intelligence alliance between New Zealand, Australia, Canada, the United States and the United Kingdom. It plays a vital role for New Zealand in being a part of that international network, which directly benefits New Zealand. Experience over the past few years shows that it is better to be forewarned than forearmed. Intelligence gathering plays a significant role in tracking extremists and has been proved worthwhile internationally.
The spy base employs local people, it does not emit any poisonous gases or spill pollutants into the soil or rivers. If it were not for the annual protests most people would not really give a hoot about it. There are valid concerns that privacy could be invaded by the base's interception of communications. But if that interception of communications was responsible for saving a life then having two oversized golf balls in our backyard is a small price to pay.
The spy base at Waihopai has certainly generated its fair share of controversy over the years. About 30km outside Blenheim on the Waihopai Valley Road, the base, with its two white globes, has stood in the Waihopai Valley since 1989, writes The Marlborough Express in an editorial.
The Waihopai spy base is operated by New Zealand's Government Communications Security Bureau. Exactly what goes on at the base is not 100 percent clear but its two satellite interception dishes (shielded from public view by giant domes) are said to intercept a huge volume of telexes, faxes, emails and computer data communications. Opponents of the base believe it is part of Echelon, the worldwide network of signals interception facilities run by the American and British intelligence agencies.
They do not want New Zealand to be part of Uncle Sam's spy network, and were particularly fired up by revelations found in former prime minister David Lange's papers that this country spied on friendly countries in the 1980s.
Anti-base campaigners say the base's existence makes New Zealand complicit in America's wars. Some say it is the key contribution New Zealand makes to any American war anywhere in the world, and leaves New Zealand with blood on its hands. It also places an unreasonable burden on New Zealand taxpayers, who have paid about half a billion dollars in the last 20 years.
The spy base has been the site of protests over many years. Every year it is the venue for an annual protest that sees a group of protesters stand around outside its gates with placards, yelling slogans and generally just expressing their displeasure at the base.
The base attracted international attention on April 30 when three sickle-wielding protesters broke on to the site and deflated one of the large inflatable domes covering a radar dish. The men were members of Ploughshares, a London-based movement which delivers its disarmament message by attempting to disable warplanes and other military equipment.
The group describes itself as "people committed to peace and disarmament and who nonviolently, safely, openly and accountably disable a war machine or system so that it can no longer harm people". Whether the Waihopai spy base can truly be called a "war machine" or whether it really "harms people" is debatable.
The Waihopai Satellite Communications Station is part of a signals intelligence alliance between New Zealand, Australia, Canada, the United States and the United Kingdom. It plays a vital role for New Zealand in being a part of that international network, which directly benefits New Zealand. Experience over the past few years shows that it is better to be forewarned than forearmed. Intelligence gathering plays a significant role in tracking extremists and has been proved worthwhile internationally.
The spy base employs local people, it does not emit any poisonous gases or spill pollutants into the soil or rivers. If it were not for the annual protests most people would not really give a hoot about it. There are valid concerns that privacy could be invaded by the base's interception of communications. But if that interception of communications was responsible for saving a life then having two oversized golf balls in our backyard is a small price to pay.
Domebuster in The Press
`Waihopai 3' to face court after attack on spy base
The year 1980 was pivotal for American peace activist Philip Berrigan.
He was no stranger to controversy. Thirteen years before, he was the first Catholic priest in the United States to serve time for civil disobedience six months in jail for a graphic protest against the Vietnam war. He and three others had saturated military service papers with their own blood.
In September 1980, Berrigan's beliefs were undiminished.
With seven others, he entered a factory in Pennsylvania that made cones for nuclear warheads. They attacked the cones with hammers, then poured their blood on official documents before offering prayers for peace.
Their anti-war protest was the first carried out in the name of Ploughshares.
The word is from the prophet Isaiah in the Old Testament.
Looking into a distant, peaceful future Isaiah said: "They shall beat their swords into ploughshares, their spears into pruning hooks; nation shall not lift sword against nation; and there shall be no more training for war."
Berrigan and his associates were charged and imprisoned. They never denied what they had done, but tried to use the biblical reference as justification.
A ploughshare is the cutting edge of a plough. In essence, they were calling for the tools of war to be turned into the tools of peaceful productivity. Isaiah's vision was to be fulfilled not buried in the scriptures.
Since 1980, there have been up to 100 similar Ploughshares' protests around the world.
On January 1, 1991, mainstream New Zealand was introduced to Ploughshares.
In the lead-up to Washington's first war with Iraq, an unknown 22-year-old from Christchurch made headlines when she was arrested in the United States.
Moana Coles and three others had cut their way into the Griffiss military base in New York, hammered on aircraft and the runway, poured blood and spray-painted anti-war slogans.
They were the first to put the acronym ANZUS in front of the Ploughshares name, saying they wanted to create "a new pact for peace".
Coles spent time in jail and eventually was deported.
Now, back in Christchurch, she stands by the action.
"I would argue that our analysis wasn't wrong. The infrastructure of Iraq was destroyed, 50,000 kids died in the bombing of Iraq in 1991, and a further couple of hundred thousand children under the age of five have died since because of the sanctions.
"So this was a war that broke international law, and we would say that as Christians we had an obligation to put our bodies in between those weapons and those who were going to be killed by them. And we have no choice about that if we are serious about our faith."
Silence and inaction are complicity in Coles's eyes.
At least one of the Waihopai Three 68-year-old Peter Murnane from Auckland, himself a Catholic priest supports the notion.
He believes the scripture does imply a duty. "The more I read about Iraq, the awfulness and the size of the crime, the first Iraqi war in 1991, and then the 12 years of sanctions or more, and then the second war, were designed to destroy that country. And any little thing I can say against those who do it, or the weaponry or the intelligence network that is combining to enable those things, anything I can do, I'll do."
Not all Ploughshares activists are religious, but it is Catholics, more than any other Christians, with whom the movement is most closely associated. Within the Catholic Church though, few openly support its activities.
Christchurch's most senior Roman Catholic, Bishop Barry Jones, told The Press not many would condone the wilful destruction of property. "I think they are misguided in the sense that they go too far. You could make a symbolic protest and it could be very effective without breaking any laws at all.
"And lots of people have done that through history. I did it when the Springbok tour was on, and I didn't break any law, and I protested like mad." In some Ploughshares' cases courts have taken a liberal view.
In July 2006, an Irish jury acquitted a group of criminal damage to property. Five activists had broken into Shannon Airport in County Clare, beating on an American supply plane with hammers and pouring their own blood over it.
The airport's use as a "pitstop" for American troops in Iraq was largely unknown in Ireland and the five used the case to highlight what they viewed as complicity in the war machine.
They argued their protest was necessary to prevent worse crimes.
The jury essentially agreed that in the circumstances damaging the plane could not be considered a crime.
However, the April, 2008, action against the Waihopai spy dome may be more complicated. For one thing, it was against an intelligence installation, not a weapon of war. Moana Cole, now also a lawyer and Sam Land's legal representative, accepted that this particular case was different.
"It is quite an unusual Ploughshares' action, and up until now, for those groups who have identified themselves with Ploughshares activists, it's always been against a weapon or a weapons' system," she said.
"What one has to do then is try to explain quite carefully the role of intelligence in modern warfare, which has had increasing prominence in the modern age ... and particularly since 1991 where intelligence bases play a strong part in military alliances."
The Waihopai Three will have to convince the court the moral argument is relevant.
They are charged with causing intentional damage and entering a building with the intent to commit a crime.
Bishop Barry Jones said it was about contravention of a just law. For him, breaking a law to liberate someone from torture was one thing, political protest another.
"The greatest contribution that citizens can make to peace in society is to observe the rule of law. Otherwise, instead of having a peaceful and harmonious and secure society, we have a shambles," he said. "If everyone is free to go around and break the law because they have noble instincts, life is going to be very tricky."
Father Peter Murnane will not be convinced. "We didn't bomb anything, we didn't blow up a family," he said. "In a minor way to break a law, to damage a bit of property is trivial in comparison. Is he (Jones) concerned about the destruction of people, of generations of human beings? It is a matter of proportion. No law is sacrosanct in that sense, no property is sacrosanct."
Peter Murnane, Sam Land and Adrian Leason will appear in the Blenheim District Court for a depositions hearing on Thursday.
The year 1980 was pivotal for American peace activist Philip Berrigan.
He was no stranger to controversy. Thirteen years before, he was the first Catholic priest in the United States to serve time for civil disobedience six months in jail for a graphic protest against the Vietnam war. He and three others had saturated military service papers with their own blood.
In September 1980, Berrigan's beliefs were undiminished.
With seven others, he entered a factory in Pennsylvania that made cones for nuclear warheads. They attacked the cones with hammers, then poured their blood on official documents before offering prayers for peace.
Their anti-war protest was the first carried out in the name of Ploughshares.
The word is from the prophet Isaiah in the Old Testament.
Looking into a distant, peaceful future Isaiah said: "They shall beat their swords into ploughshares, their spears into pruning hooks; nation shall not lift sword against nation; and there shall be no more training for war."
Berrigan and his associates were charged and imprisoned. They never denied what they had done, but tried to use the biblical reference as justification.
A ploughshare is the cutting edge of a plough. In essence, they were calling for the tools of war to be turned into the tools of peaceful productivity. Isaiah's vision was to be fulfilled not buried in the scriptures.
Since 1980, there have been up to 100 similar Ploughshares' protests around the world.
On January 1, 1991, mainstream New Zealand was introduced to Ploughshares.
In the lead-up to Washington's first war with Iraq, an unknown 22-year-old from Christchurch made headlines when she was arrested in the United States.
Moana Coles and three others had cut their way into the Griffiss military base in New York, hammered on aircraft and the runway, poured blood and spray-painted anti-war slogans.
They were the first to put the acronym ANZUS in front of the Ploughshares name, saying they wanted to create "a new pact for peace".
Coles spent time in jail and eventually was deported.
Now, back in Christchurch, she stands by the action.
"I would argue that our analysis wasn't wrong. The infrastructure of Iraq was destroyed, 50,000 kids died in the bombing of Iraq in 1991, and a further couple of hundred thousand children under the age of five have died since because of the sanctions.
"So this was a war that broke international law, and we would say that as Christians we had an obligation to put our bodies in between those weapons and those who were going to be killed by them. And we have no choice about that if we are serious about our faith."
Silence and inaction are complicity in Coles's eyes.
At least one of the Waihopai Three 68-year-old Peter Murnane from Auckland, himself a Catholic priest supports the notion.
He believes the scripture does imply a duty. "The more I read about Iraq, the awfulness and the size of the crime, the first Iraqi war in 1991, and then the 12 years of sanctions or more, and then the second war, were designed to destroy that country. And any little thing I can say against those who do it, or the weaponry or the intelligence network that is combining to enable those things, anything I can do, I'll do."
Not all Ploughshares activists are religious, but it is Catholics, more than any other Christians, with whom the movement is most closely associated. Within the Catholic Church though, few openly support its activities.
Christchurch's most senior Roman Catholic, Bishop Barry Jones, told The Press not many would condone the wilful destruction of property. "I think they are misguided in the sense that they go too far. You could make a symbolic protest and it could be very effective without breaking any laws at all.
"And lots of people have done that through history. I did it when the Springbok tour was on, and I didn't break any law, and I protested like mad." In some Ploughshares' cases courts have taken a liberal view.
In July 2006, an Irish jury acquitted a group of criminal damage to property. Five activists had broken into Shannon Airport in County Clare, beating on an American supply plane with hammers and pouring their own blood over it.
The airport's use as a "pitstop" for American troops in Iraq was largely unknown in Ireland and the five used the case to highlight what they viewed as complicity in the war machine.
They argued their protest was necessary to prevent worse crimes.
The jury essentially agreed that in the circumstances damaging the plane could not be considered a crime.
However, the April, 2008, action against the Waihopai spy dome may be more complicated. For one thing, it was against an intelligence installation, not a weapon of war. Moana Cole, now also a lawyer and Sam Land's legal representative, accepted that this particular case was different.
"It is quite an unusual Ploughshares' action, and up until now, for those groups who have identified themselves with Ploughshares activists, it's always been against a weapon or a weapons' system," she said.
"What one has to do then is try to explain quite carefully the role of intelligence in modern warfare, which has had increasing prominence in the modern age ... and particularly since 1991 where intelligence bases play a strong part in military alliances."
The Waihopai Three will have to convince the court the moral argument is relevant.
They are charged with causing intentional damage and entering a building with the intent to commit a crime.
Bishop Barry Jones said it was about contravention of a just law. For him, breaking a law to liberate someone from torture was one thing, political protest another.
"The greatest contribution that citizens can make to peace in society is to observe the rule of law. Otherwise, instead of having a peaceful and harmonious and secure society, we have a shambles," he said. "If everyone is free to go around and break the law because they have noble instincts, life is going to be very tricky."
Father Peter Murnane will not be convinced. "We didn't bomb anything, we didn't blow up a family," he said. "In a minor way to break a law, to damage a bit of property is trivial in comparison. Is he (Jones) concerned about the destruction of people, of generations of human beings? It is a matter of proportion. No law is sacrosanct in that sense, no property is sacrosanct."
Peter Murnane, Sam Land and Adrian Leason will appear in the Blenheim District Court for a depositions hearing on Thursday.
Deposition Hearing for the Waihopai Domebusters
Support Waihopai Ploughshares
17-18 September 2008
This page has the details of how you can support Waihopai Ploughshares around their depositions hearing which will be held at Blenheim District Court on Thursday, 18 September. There are four sections below: what's happening in Blenheim on 17 and 18 September, supporting events in Wellington and Auckland on 18 September, and other ways you can support Ploughshares.
"On 30 April, Christian activists Sam, Peter and Adi deflated the protective dome covering a satellite dish at the Waihopai spy base near Blenheim. This Christian non-violent direct action was to protest against NZ's involvement in America's war in Iraq. On the 18th of September, they will be in court for their depositions hearing where they will enter a plea in relation to the two criminal charges they are facing. Your prayers and support are appreciated."
Blenheim, 17 and 18 September
On Wednesday, 17 September
* 6pm - evening meal at St Mary's Presbytery, 61 Maxwell Road
* 7.30pm - 'Swords into ploughshares: defence bases and idolatry' discussion forum, Saint Mary's Church foyer. Overnight accommodation at St Mary's Parish Hall (mattresses only provided)
On Thursday, 18 September
* 10am - depositions hearing, Courtroom No 1, Blenheim District Court, 58 Alfred Street
* 1pm to 2pm - sausage sizzle and cake stall to raise money for the reconstruction of Iraq (target:USD$800,000,000,000) at the Blenheim War Memorial, opposite the court house.
A printable poster with the Blenheim events is available here, for more information contact Adi, tel 06 364 8966 or email.
Wellington, Thursday 18 September
From 1pm to 2.30pm - peaceful presence at the GCSB HQ, Freyberg Building, corner Aitken Street and Mulgrave Street (opposite Archives NZ), with music, and more! All welcome, come along and support Ploughshares non-violent / faith-based kaupapa; for more information contact the Wellington Ploughshares Support Group.
Auckland, Thursday 18 September
From 12.30pm to 2pm - peaceful presence outside the US Consulate, Citibank Building, 23 Customs Street East (corner of Commerce Street). All welcome! come along and support Ploughshares non-violent / faith-based kaupapa, for more information contact the Auckland Ploughshares Support Group.
Other ways you can support Ploughshares
Prayer, advocacy and money are all important ways that supporters can participate in the witness of Ploughshares. Ploughshares support information - including a request for prayers / karakia, how to post messages of support or join the Ploughshares mailing list, and suggestions for questions you can ask the Prime Minister about Waihopai - are available on the Ploughshares web site or by email.
Help get the message out - print and distribute this flyer.
If you can help with financial support, donations can be made * by bank transfer: WestPac, Account Name: Te Wairua Maranga Trust, Account Number: 03-1703-0036346-04 - donations are not tax-deductible * by cheque: please send your cheque payable to 'Peace Movement Aotearoa - Special Projects', with a note saying it is for Waihopai Ploughshares, and your name and address (if you'd like a receipt) to Peace Movement Aotearoa, PO Box 9314, Wellington 6141. Thank you
17-18 September 2008
This page has the details of how you can support Waihopai Ploughshares around their depositions hearing which will be held at Blenheim District Court on Thursday, 18 September. There are four sections below: what's happening in Blenheim on 17 and 18 September, supporting events in Wellington and Auckland on 18 September, and other ways you can support Ploughshares.
"On 30 April, Christian activists Sam, Peter and Adi deflated the protective dome covering a satellite dish at the Waihopai spy base near Blenheim. This Christian non-violent direct action was to protest against NZ's involvement in America's war in Iraq. On the 18th of September, they will be in court for their depositions hearing where they will enter a plea in relation to the two criminal charges they are facing. Your prayers and support are appreciated."
Blenheim, 17 and 18 September
On Wednesday, 17 September
* 6pm - evening meal at St Mary's Presbytery, 61 Maxwell Road
* 7.30pm - 'Swords into ploughshares: defence bases and idolatry' discussion forum, Saint Mary's Church foyer. Overnight accommodation at St Mary's Parish Hall (mattresses only provided)
On Thursday, 18 September
* 10am - depositions hearing, Courtroom No 1, Blenheim District Court, 58 Alfred Street
* 1pm to 2pm - sausage sizzle and cake stall to raise money for the reconstruction of Iraq (target:USD$800,000,000,000) at the Blenheim War Memorial, opposite the court house.
A printable poster with the Blenheim events is available here, for more information contact Adi, tel 06 364 8966 or email.
Wellington, Thursday 18 September
From 1pm to 2.30pm - peaceful presence at the GCSB HQ, Freyberg Building, corner Aitken Street and Mulgrave Street (opposite Archives NZ), with music, and more! All welcome, come along and support Ploughshares non-violent / faith-based kaupapa; for more information contact the Wellington Ploughshares Support Group.
Auckland, Thursday 18 September
From 12.30pm to 2pm - peaceful presence outside the US Consulate, Citibank Building, 23 Customs Street East (corner of Commerce Street). All welcome! come along and support Ploughshares non-violent / faith-based kaupapa, for more information contact the Auckland Ploughshares Support Group.
Other ways you can support Ploughshares
Prayer, advocacy and money are all important ways that supporters can participate in the witness of Ploughshares. Ploughshares support information - including a request for prayers / karakia, how to post messages of support or join the Ploughshares mailing list, and suggestions for questions you can ask the Prime Minister about Waihopai - are available on the Ploughshares web site or by email.
Help get the message out - print and distribute this flyer.
If you can help with financial support, donations can be made * by bank transfer: WestPac, Account Name: Te Wairua Maranga Trust, Account Number: 03-1703-0036346-04 - donations are not tax-deductible * by cheque: please send your cheque payable to 'Peace Movement Aotearoa - Special Projects', with a note saying it is for Waihopai Ploughshares, and your name and address (if you'd like a receipt) to Peace Movement Aotearoa, PO Box 9314, Wellington 6141. Thank you
Peace Researcher August 08 Online
Pop Goes The Spybase! Waihopai Domebusters Severely Embarrass The Covert State – by Murray Horton
Waihopai Protest 08 – by Murray Horton
Pine Gap Spybase “Invaders” Acquitted: Huge Defeat For The Covert State – by Murray Horton
In The Dragon’s Lair – by Herbert Docena
West Papua: Have We Forgotten The Lessons Of East Timor? – by Maire Leadbeater
Reviews by Bob Leonard & Jeremy Agar
“America In Peril”, by Bob Aldridge
“The Three Trillion Dollar War” by Joseph Stiglitz and Linda Bilmes
“Against Freedom: The War On Terrorism In Everyday New Zealand Life” by Valerie Morse
“Unconventional Warfare” A DVD
“The Peace Movement In Christchurch 1937-41, 1946-47: A Memoir”, by Will Foote
Obituaries by Murray Horton
Philip Agee
Reg Duder
Waihopai Protest 08 – by Murray Horton
Pine Gap Spybase “Invaders” Acquitted: Huge Defeat For The Covert State – by Murray Horton
In The Dragon’s Lair – by Herbert Docena
West Papua: Have We Forgotten The Lessons Of East Timor? – by Maire Leadbeater
Reviews by Bob Leonard & Jeremy Agar
“America In Peril”, by Bob Aldridge
“The Three Trillion Dollar War” by Joseph Stiglitz and Linda Bilmes
“Against Freedom: The War On Terrorism In Everyday New Zealand Life” by Valerie Morse
“Unconventional Warfare” A DVD
“The Peace Movement In Christchurch 1937-41, 1946-47: A Memoir”, by Will Foote
Obituaries by Murray Horton
Philip Agee
Reg Duder
August 08 Watchdog
Foreign Control Watchdog 118
August 2008
Sharks In The Water: Privatisation Rears Its Ugly Head Again, by Murray Horton
Danger Ahead! Back Door US Deal Threatens All Remaining Foreign Investment Rules, by Bill Rosenberg
Round And Round The Mulberry Bush: Auckland Airport And Treasury Advice, by Quentin Findlay
Where National’s Social Service Policy Will Go: A Super Contractor To Control Social Services, by Tim Howard
A Decade Of Rogering: It’s A Tough Job But Somebody Has To Do It, by Murray Horton
Global Food Crisis And Free Trade Disaster, by Dennis Small
Pop Goes The Spybase! Waihopai Domebusters Severely Embarrass The Covert State, by Murray Horton
Reviews, by Jeremy Agar“The Hollow Men”; A Film By Alister Barry“Arsenal of Hypocrisy”; A Film By Randy Atkins“The Three Trillion Dollar War”; by Joseph Stiglitz and Linda Bilmes
Obituaries by Murray Horton Morry GardnerDon McNivenMick RobertsonTrever WrightMartin LawrenceDeath In The Family: Aileen Finucane
The Campaign To Stop Electricity Privatisation In NSW, by Denis Doherty
Non-Members: It takes a lot of work to compile and write the material presented on these pages - if you value the information, please send a donation to help us continue the work.
The material on this site may be reproduced provided the source is acknowledged. Published by Foreign Control Watchdog Inc, Box 2258, Christchurch, New Zealand.
email cafca@chch.planet.org.nz
Note that the regular analysis of the decisions of the Overseas Investment Office, which are published in every Foreign Control Watchdog are not republished here because they are available on the web site of the Campaign Against Foreign Control of Aotearoa (CAFCA).
August 2008
Sharks In The Water: Privatisation Rears Its Ugly Head Again, by Murray Horton
Danger Ahead! Back Door US Deal Threatens All Remaining Foreign Investment Rules, by Bill Rosenberg
Round And Round The Mulberry Bush: Auckland Airport And Treasury Advice, by Quentin Findlay
Where National’s Social Service Policy Will Go: A Super Contractor To Control Social Services, by Tim Howard
A Decade Of Rogering: It’s A Tough Job But Somebody Has To Do It, by Murray Horton
Global Food Crisis And Free Trade Disaster, by Dennis Small
Pop Goes The Spybase! Waihopai Domebusters Severely Embarrass The Covert State, by Murray Horton
Reviews, by Jeremy Agar“The Hollow Men”; A Film By Alister Barry“Arsenal of Hypocrisy”; A Film By Randy Atkins“The Three Trillion Dollar War”; by Joseph Stiglitz and Linda Bilmes
Obituaries by Murray Horton Morry GardnerDon McNivenMick RobertsonTrever WrightMartin LawrenceDeath In The Family: Aileen Finucane
The Campaign To Stop Electricity Privatisation In NSW, by Denis Doherty
Non-Members: It takes a lot of work to compile and write the material presented on these pages - if you value the information, please send a donation to help us continue the work.
The material on this site may be reproduced provided the source is acknowledged. Published by Foreign Control Watchdog Inc, Box 2258, Christchurch, New Zealand.
email cafca@chch.planet.org.nz
Note that the regular analysis of the decisions of the Overseas Investment Office, which are published in every Foreign Control Watchdog are not republished here because they are available on the web site of the Campaign Against Foreign Control of Aotearoa (CAFCA).
New York Times article about New Zealand and Nuclear
Let’s Hear It for New Zealand
Published: August 31, 2008
If you are feeling anxious — and you should be — about the world’s appetite for nuclear weapons, there is a bit of good news. More countries than we ever expected are refusing to be pressured by the United States and India to approve an ill-conceived nuclear deal.
For 30 years, ever since India used its civilian nuclear program to produce a bomb, the world has been banned from selling nuclear technology to India. Three years ago, President Bush agreed, with far too few conditions, to break that ban and sell India reactors and fuel.
The White House argued that India is an important democracy and shrugged off critics who said that breaking the rules would make it even harder to pressure Iran and others to abandon their nuclear ambitions.
The administration — and India’s high-paid lobbyists — managed to persuade Congress to give preliminary approval to the deal. But before it can go forward, the 45-member Nuclear Suppliers Group (which sets rules for nuclear trade) must also agree.
At a meeting this month, more than 20 governments delayed approval, raising serious questions and insisting on sound conditions. They insisted that there can be no sale to India of technology to make more nuclear fuel — usable for a reactor or a bomb — and that suppliers halt all trade if India tests another weapon. And they insisted that India accept the most rigorous possible international monitoring of its civilian nuclear facilities.
We hope this admirable band — led by New Zealand, Ireland, Austria, Norway, the Netherlands and Switzerland — continues to stand firm when the nuclear group meets again this week.
Mr. Bush and his team were so eager for a foreign policy success that they gave away the store. They extracted no promise from India to stop producing bomb-making material. No promise not to expand its arsenal. And no promise not to resume nuclear testing.
When Congress gave its approval it wrote in the many of the same conditions that New Zealand and others are insisting on. That has not stopped the administration from insisting on more generosity from the suppliers group. If it gets its way, India could end up buying technology from Russia, France and other less exacting sellers while bypassing the United States. Add that to the list of what is deeply wrong with this deal.
Published: August 31, 2008
If you are feeling anxious — and you should be — about the world’s appetite for nuclear weapons, there is a bit of good news. More countries than we ever expected are refusing to be pressured by the United States and India to approve an ill-conceived nuclear deal.
For 30 years, ever since India used its civilian nuclear program to produce a bomb, the world has been banned from selling nuclear technology to India. Three years ago, President Bush agreed, with far too few conditions, to break that ban and sell India reactors and fuel.
The White House argued that India is an important democracy and shrugged off critics who said that breaking the rules would make it even harder to pressure Iran and others to abandon their nuclear ambitions.
The administration — and India’s high-paid lobbyists — managed to persuade Congress to give preliminary approval to the deal. But before it can go forward, the 45-member Nuclear Suppliers Group (which sets rules for nuclear trade) must also agree.
At a meeting this month, more than 20 governments delayed approval, raising serious questions and insisting on sound conditions. They insisted that there can be no sale to India of technology to make more nuclear fuel — usable for a reactor or a bomb — and that suppliers halt all trade if India tests another weapon. And they insisted that India accept the most rigorous possible international monitoring of its civilian nuclear facilities.
We hope this admirable band — led by New Zealand, Ireland, Austria, Norway, the Netherlands and Switzerland — continues to stand firm when the nuclear group meets again this week.
Mr. Bush and his team were so eager for a foreign policy success that they gave away the store. They extracted no promise from India to stop producing bomb-making material. No promise not to expand its arsenal. And no promise not to resume nuclear testing.
When Congress gave its approval it wrote in the many of the same conditions that New Zealand and others are insisting on. That has not stopped the administration from insisting on more generosity from the suppliers group. If it gets its way, India could end up buying technology from Russia, France and other less exacting sellers while bypassing the United States. Add that to the list of what is deeply wrong with this deal.
North and South Article on Rio Tinto
Smelter
The Power of One
As the country emerges from another winter with threatened power blackouts, Mike White investigates why one factory, the Tiwai Pt aluminium smelter, is allowed to swallow nearly 15 per cent of the country’s precious electricity and asks whether it’s time they shut up.
He wore a serious suit and a whiff of hair product. She wore black, and the rimless glasses of generations of librarians.
Paul Hemburrow and Xiaoling Liu had come to Parliament’s finance select committee with dark dress and a grave message from their employer, aluminium colossus Rio Tinto Alcan (formerly Comalco): Carry on with your climate change legislation and we’ll have to close our aluminium smelter at Tiwai Point near Bluff.
Ms Liu, Rio Tinto Alcan’s Asia Pacific president of primary metal had jetted in, in a show of strength from the world’s biggest aluminium company.
But the most telling line was left to Paul Hemburrow, the 38-year-old Australian who heads the company in New Zealand and is the smelter’s general manager.
“What we are saying is that if the bill proceeds as it’s currently written, it is likely to put us on the pathway to closure.”
In the velvet-gloved world of political lobbying and PR, this bore all the subtlety of cudgelling MPs with a fencepost.
Hemburrow’s argument was that being asked to share a portion of the country’s greenhouse gas responsibility was a financial bridge too far, leaving it so cash strapped, so marginal, it would have to shift elsewhere.
What may not have been understood by many, as Rio Tinto Alcan offered this scenario of gloom and grief back in May, was the company’s obligations would be heavily subsidised, only having to pay 10 per cent of its 2005 greenhouse gas emissions until 2019 - it wouldn’t have to pay its full dues until 2030. Moreover there would be two reviews of the scheme to ensure it wasn’t an unfair imposition.
Nor would many have been aware that Rio Tinto Alcan New Zealand, which owns nearly 80 per cent of New Zealand Aluminium Smelters (the remainder owned by Sumitomo Chemical Company of Japan), is hardly on the verge of collapse – with aluminium prices soaring to over US$3000 a tonne (having nearly doubled since 2004), last year it had revenue of $1.1 billion and profits of $204 million. Its parent company, Rio Tinto, is scarcely an international sprat either, last year having paid US$38.1 billion for Alcan to dominate world aluminium production. It’s the world’s third largest minerals company, has operations in 61 countries, 25 other smelters and its 2007 profit was US$7.4 billion.
Fewer still would have bothered to do the sums, as economist Rod Oram did, that suggest even with an extremely high price of carbon the eventual cost to the company would actually be minimal – around 3 per cent.
And as people shivered at the thought of Southland’s second largest employer disappearing after nearly four decades, it’s a fair guess that most wouldn’t have realised Hemburrow’s tactless threat was an echo of one made by successive smelter chiefs: Push us, squeeze us and we’ll piss off.
***
This is how aluminium is made:
Bauxite, a pebbly red material, is mined and refined into a white powder, alumina. This is then dumped into a chemical bath, simmering at nearly 1000 degrees C, through which huge amounts of electricity are passed causing a reaction that creates aluminium and spills off CO2. It’s clever, but it ain’t new – the technique that nearly all the world’s 260 smelters still use was invented in 1886, has changed little and simply relies on enormous quantities of electricity – in Tiwai’s case close to 15 per cent of everything used in New Zealand or the amount used by 625,000 homes.
This is how a smelter is made:
In 1956, Australian company Consolidated Zinc approached the New Zealand government about constructing a smelter, indicating it would come here if guaranteed a large source of electricity.
Serendipitously, as early as 1904 the government had considered the hydroelectric potential of Lake Manapouri, buried in the Fiordland heartland, so the two ideas were meshed and the parties became industrial dancing partners. Initially Consolidated Zinc (which soon became Comalco) was going to build both the Manapouri power station and a smelter at Tiwai but by 1961 said it didn’t have enough money so the government built the power station.
However a special Act was passed in 1963 giving the company rights to the station’s power for 100 years.
In 1969 the first electricity was generated from Manapouri and in April 1971 the first aluminium smelted at Tiwai.
Today the fruit of that coupling can be seen south of Invercargill, where the Southern Ocean finally beaches itself after journeying from Antarctica.
Twin columns of pylons carrying Manapouri’s energy loom from the landscape, straddle the road to the smelter in a quietly hissing colonnade, then swing off across flax fringed swampland, tiptoe across Awarua Bay and sling their wires for a further kilometre to the smelter, tucked in the curl of Tiwai peninsula across from Bluff.
It essentially takes the entire output of Manapouri, our country’s largest hydroelectric power station, and pays roughly a quarter of what you pay for your power.
For something that consumes so much of the country’s electricity, the smelter’s a disappointingly unremarkable destination with sulking buildings in variegated grey, as if all the colour has been leached from them after decades of industrial effort. Only a smoke stack rises from these lower case roofs, like an exclamation mark signalling the smelter’s steadfastness.
Three strands of barbed wire atop a mesh fence and several warning signs make it clear this is smelter territory – its own world at the end of the world.
Inside however some of the purest aluminium in the world is manufactured – up to 99.98 per cent unadulterated – with a third of its production used for cellphones, computers and the wings of the new Airbus A380 aircraft. (Some is also used for less exciting purposes, such as window frames and packaging foil.)
The smelter is essentially four lines of “pots” – the cells where alumina from Australia is constantly mixed with Manapouri electricity. At Tiwai, 672 pots produce about 350,000 tonnes of aluminium annually – just under one per cent of the world’s production. Nearly 90 per cent of this is shipped to predominantly Asian markets from a wharf that stretches into Bluff Harbour like a half-submerged fenceline.
Though you can stare down an entire 600m potline and see nobody, such is the quiet, almost subterranean process of aluminium smelting, the site employs 915 fulltime staff and contractors and studies estimate another 1600 Southland jobs may rely on the smelter’s existence.
Locally, it’s considered a good employer – more than 100 staff are members of its 25-year club, a handful having worked there since it started, and it paid $78 million in wages last year with its average pay higher than the area’s mean.
It contributes to the community in many other ways, from school science fairs to helping save the kakapo and you’d struggle to find opponents to it along Invercargill’s pavements.
The irony is though, the smelter was born amidst controversy, has attracted criticism throughout its life, and still, somehow, finds itself defending its right to be here. Because not only does the smelter often threaten to quit the country, others have long called for the government to show it the door.
***
Deep deep beneath Lake Manapouri, the hum of the power station becomes a controlled roar the closer you get to its heart. Seven massive turbines are constantly spun with water that’s plummeted 166m from the lake’s surface and then, it’s job done, set flowing 10km through the mountains to be discharged into Doubtful Sound. It’s one of New Zealand’s great engineering feats but it came at a great cost with 16 men being killed - and almost at the price of a great lake.
Initial plans for the power station that would feed Tiwai’s smelter called for Lake Manapouri to be raised by up to 30m.
The country’s largest environmental protest, including a 265,000-strong petition, eventually saved the lake from what’s now unthinkable desecration.
Save Manapouri became a slogan for a generation and ushered in a new era of environmental awareness.
The smelter was inevitably sullied by association with the plans but it was its operation and tactics that soon became the focus.
In 1970 it was revealed preferential Comalco shares had been offered to influential New Zealanders including politicians, local councillors, judges and journalists.
Public concern rose as it emerged how cheaply Comalco was getting power and how many breaks it had been cut by a government desperate to lure foreign investment.
Its favoured status was reinforced in 1972 when electricity supply to Dunedin was disrupted so the smelter could maintain production.
Later studies showed the smelter paid minimal tax until the mid-1980s, because of depreciation allowances in its agreement with the government.
The country’s growing intolerance of such colossal projects became evident when a second smelter proposed for Aramoana near Dunedin in the 1970s was canned for economic and environmental reasons after huge protest.
Rio Tinto’s controversial involvement in international events, from dealing with Spain’s fascists in the 1930s to the mired events of Papua New Guinea’s Panguna Mine, has also tarnished the current owner’s image over the decades.
The organisation now known as Campaign Against Foreign Control of Aotearoa (CAFCA) was born largely from opposition to the smelter and how its owners were seen to be ripping off New Zealand.
More than 30 years on, spokesman Murray Horton still beats a drum calling for action against the smelter.
After Rio Tinto’s appearance at the select committee Horton issued one of his inimically blunt press releases headlined: “Rio Tinto, Stop Crying Wolf. Just Close The Bluff Smelter & Bugger Off.”
Horton objects to both the cheap price Rio Tinto Alcan pays for such a large chunk of the country’s electricity and also how successive governments have flinched every time the corporate has flexed its muscle through heavyweight lobbyists and heavy-handed threats.
“Effectively what we’re doing is exporting electricity that they get at top secret, dirt cheap prices. And whenever that’s put under threat they threaten to walk.
“They’ve outwitted all the governments since Holyoake and when New Zealand industry was thrown open to the bracing winds of market forces and economics in the ’80s none of that affected Comalco. They’ve always been big fans of corporate welfare – ie. you and me subsidising their electricity – it’s the biggest bludger in the country.”
Back in the ’60s at a time when the smelter was being built, Horton stood shoulder to shoulder on the front lines of anti-Vietnam War protests with Tim Shadbolt.
Today, however, they face each other across the lines, Shadbolt now Invercargill’s mayor and cheerleader for the smelter.
“The thought of it closing is frightening. We’re less dependent on it now than in the ’70s and ’80s when one in four jobs was associated with the smelter – now it’s only about one in 10 – but it’s still hugely significant.”
Shadbolt has strong historical attachment to the issue – after protesting against the lake being raised he worked on the Manapouri tunnel project for a year during his university days.
“Manapouri was built for the smelter and the smelter was built for Manapouri. So they kind of have a historical right that we’re quite protective about. We built Manapouri for our own benefit really and most of the workers were from Southland or Invercargill. It was a man a mile getting killed and all the New Zealanders killed were Southlanders. So we feel we made the sacrifice, we did the work specifically for the smelter and we should have first right to the electricity.”
And he admits the council tries to keep Rio Tinto happy because the multinational “wouldn’t worry for more than two seconds whether it stays open or closes. I’ve met the directors – to us it’s a huge deal, to most New Zealanders it’s at least a recognised deal, but to Rio, well, it doesn’t really matter.”
Thus, building a new $12 million bridge to the smelter is the latest example of corporate appeasement borne by ratepayers.
“But I still respect and like guys like Murray Horton because they’re patriots in a way, they’re looking at the national interest and you need people like that. And I guess I’m paid, my job is to look after Invercargill’s interests - so I’m a mercenary and he’s an idealist in this situation, so I have to respect him.”
***
But what would happen if Rio Tinto did leave, as they’ve threatened and as others are calling for them to do?
For a start, you wouldn’t be able to use half of Manapouri’s power anywhere else. Constraints on the national grid mean you couldn’t get more than about 300MW further north than Roxburgh without a significant upgrade of transmission lines.
Estimates for this work vary between $40 million and $200 million (depending on whether a new line of pylons is needed) and consents could take years to be granted. While Transpower, the state-owned company that runs the national grid, is looking at such scenarios, no upgrade is imminent.
And though Southland’s booming dairy industry could soak up some of Manapouri’s output, its demand would be tiny compared to the electricity hungry beast that is the smelter.
Secondly, even if we could get the power to places like Auckland where it’s most needed, it wouldn’t solve the country’s current shortage of electricity generation, but only delay the need for more windfarms or geothermal plants. New Zealand’s electricity needs are growing by around 150MW a year, so closing the smelter would mean we mightn’t have to build anything for about four years. But then, without significant reduction in our power use, we’d be back to where we are now, worrying if we have enough power to get us through a dry winter.
Electricity Commission chairman David Caygill says calls for the smelter to be shut down so we can claw back a large chunk of electricity are a knee jerk, not a sensible, long-term view.
“It’s almost a panic response – the only thing we can think of.”
Thirdly, smelter supporters say that if Rio Tinto left they’d simply re-establish the smelter in a country like China, where its power would probably come from a greenhouse gas emitting coal-powered station, not carbon free hydro like Manapouri. Thus, they argue, the world would be better off if they stay here.
However one obvious scenario would be that if we had Manapouri’s power to use across the rest of the country we could greatly reduce our use of coal and gas such as at the Huntly power station which produces about 12.5 per cent of the country’s power. Doing this would save the country millions in carbon credits needed to meet our Kyoto obligations and arguably balance the emissions a relocated smelter in China might create.
(Amongst Rio Tinto’s justifications for Tiwai has been exactly this suggestion of “carbon leakage” – that if things get too tough here it might go to China where there are laxer emissions rules and this would end up harming the world’s environment more. This blunt acknowledgement that company profits supersede environmental obligations tends to undermine claims in their sustainability report that they accept responsibility to work towards climate change solutions. Claims the smelter wishes to “show leadership” in responding to climate change also appear at variance with their suggestion in 2005 they build a 600MW coal-powered station to produce their own electricity at a time when they were negotiating a new power contract.)
Fourthly, if the smelter closed, a cornerstone of Southland’s economy would be removed and with it, hundreds of jobs.
However the effect may not be as bad as the smelter’s owners and its supporters have postulated.
Southland’s economy is positively pulsating at present –farm prices have almost doubled in the last year; broadband is available in 96 per cent of the region; coffee brands jostle for supremacy on pavement sandwich boards and it’s a bugger of a place to get a park at peak times.
Large developments are slated in the dairy, forestry and oil industries, the Bluff oyster beds are resurgent and the region is desperate for workers says mayor Shadbolt.
With the lowest unemployment rate in the country (2 per cent), two recent economic reports predict it will need an extra 12,500 workers by 2016 just to maintain its current economic growth.
So if the smelter closed few workers would end up on the dole, especially given claims the smelter would seek to redeploy skilled staff to its other operations overseas. (Though just how many Invercargill workers would opt to transfer to China or the likes of Libya where Rio Tinto has planned another smelter, is untested.)
Nor is it as if Southland hasn’t suffered and survived other huge industry closures – not far from the smelter, Bluff’s Ocean Beach freezing works closed in 1991 with 900 jobs lost.
And while the closure of Fisher & Paykel’s Dunedin factory (430 jobs) and Dannevirke’s Oringi freezing works (466 jobs) made headlines for a day or two earlier this year before the nation shrugged shoulders and carried on, jobs at Tiwai are considered almost sacrosanct by the smelter’s defenders.
Steve Canny, group manager of economic development group Venture Southland, accepts the smelter may be a case of, good for Southland but crap for the rest of the country.
But he says those in the deep south get irritated with “the shallow north” wanting electricity that underpins Southland’s economy without wanting power stations built on their patch.
“I can understand how an urbanite in Auckland could be a bit nervous if the power started going out. But unless there’s substantial investment in a transmission upgrade and the not-in-my-backyard scenario is being addressed in major metros, then this discussion has no substance whatsoever.”
***
So just how realistic are Rio Tinto’s threats to leave New Zealand? As mentioned, the company has a history of suggesting drastic action or departure when something upsets it.
It did it when wanting to buy the Manapouri station; when the government proposed carbon taxes; during negotiations over electricity prices and most recently over proposed greenhouse gas emissions charges.
Victoria University senior economics lecturer Geoff Bertram, who’s studied the smelter for more than 30 years, says the latest threat was lamentably predictable.
“It was an example of the bully boy tactics Rio Tinto deploys very effectively. They’re probably the best of all the corporates at this game in New Zealand.
“They have good political lobbying skills and an excellent PR machine and they’ve always played their trump card – if you’re horrible to us we’ll leave. If you have a genuine and credible threat like that you can play it as many times as the government’s prepared to cave in - political leverage is everything. And the New Zealand government is one of the weakest I’ve ever observed in this game – by international standards New Zealand’s a pushover.”
Ironically Bertram’s office, with a career’s-worth of stacked documents threatening to avalanche and bury him come the next big earthquake, looks out on the Beehive where he says successive Ministers and governments have buckled before the smelter’s owners.
“Were I the government I’d have long ago instructed officials to prepare a fully-costed contingency plan for compensating all the people that would suffer in Southland if the smelter closed. And when they came to me and said, ‘if you don’t do our will we’ll close the smelter,’ I’d be able to say, ‘all right, off you go, and I’m going to spend the necessary cash not on subsidising your operation but on making sure the ordinary New Zealanders who depend on you for a living can make a transition to a sustainable alternative – have a nice day.’”
In two earlier reports, Bertram calculated the smelter had a negative economic impact on New Zealand in its first 20 years.
Now, he says, on balance it’s probably had a moderately beneficial effect through taxes, wages, port fees and buying supplies locally.
But he says its benefits are nothing compared to say the tourism sector yet the aluminium industry wields a much larger stick politically – vastly disproportionate to its actual economic contribution.
“It’s the small business stuff that makes the New Zealand economy tick, it’s the big monopoly giants that make the government crawl.”
Rio Tinto’s influence in New Zealand isn’t unique.
In his book Running From The Storm, one of Australia’s foremost climate change commentators, Clive Hamilton, notes:
“The (aluminium) industry has repeatedly managed to bully and bluff governments into giving it special concessions and has constantly retarded progress towards resolving the greenhouse issue. It has without doubt been the most self-serving, uncompromising lobby group in the climate change debate in Australia.”
Rio Tinto has a bauxite mine, two alumina refineries and two smelters in Australia.
Across Molesworth St from Geoff Bertram’s office, Climate Change Minister David Parker rejects the notion he’s unwilling to stand up to the smelter owners, insisting the government is determined to push through its emissions trading legislation and calling Rio Tinto’s claims “exaggerated” and “an idle threat”.
“I think we all know that business is about money and in the end businesses are largely motivated by effects on their profit and loss. So they try and minimise things that increase their loss. And that’s what Rio Tinto’s doing here – I wouldn’t call it improper but I see it for what it is.
“They’ve got a private interest in minimising the amount of responsibility they have to take for the cost of their emissions. Now, there’s a cost to the country for their emissions but from their perspective they’d rather the taxpayer bore the cost than them.
“And I don’t think the burden upon them is large in relation to the profitability of their business.”
Parker, who is also Energy Minister, says Rio Tinto is clearly only in New Zealand because it gets a competitive power price and the Tiwai smelter is in fact very well placed compared to other smelters that rely on electricity from coal and gas fuelled stations.
“We don’t think they’ll close. I’ve got no doubt the country would survive (if it did) but it’s not something we’d have as an objective. It’s clearly a substantial employer and a substantial contributor to the Southland economy – but that doesn’t mean we’d have it there at all costs.”
***
Paul Hemburrow insists he stands by his assertion that the smelter would end up closing under current emissions trading legislation. But given such certainty, he’s strangely reluctant to say when this might happen, merely suggesting “you can do the numbers” – a bizarre statement considering how secretive the smelter is about its costs.
He stresses Rio Tinto supports emissions trading and is happy to pay its share – but just not unless all other smelters in the world face the same costs. (It should be noted the smelter has reduced CO2 emissions 42 per cent since 1990, despite upping production 27 per cent.)
Nor will Hemburrow countenance suggestions the smelter gets cheap power let alone that taxpayers and other electricity users effectively subsidise the giant multinational.
“The contract price we have is an outcome of a commercially very robust negotiation,” says Hemburrow wielding a shield of business jargon.
“I think there’s a misconception it’s a particularly cheap price, because it’s certainly not.”
Well, maybe not cheap in the hungry world of aluminium smelting – but certainly much cheaper than anyone else in New Zealand gets it would appear.
Neither power supply company Meridian Energy or Rio Tinto will disclose the price the smelter pays, predictably insisting it’s commercially sensitive.
But using industry figures and the smelter’s own accounts it’s possible to estimate roughly how much Rio Tinto pays for its electricity – somewhere between 5.2 cents and 5.9 cents a kilowatt hour.
By comparison the average price for other industrial consumers in 2007 was 9.2 cents and residential customers 18.6 cents.
The smelter’s current contract runs till 2012 but it’s already negotiated another deal from 2013 to 2030 with Meridian.
Presently it has a fixed contract for about 90 per cent of its electricity, buying the remainder from the spot market, paying a price that can fluctuate wildly.
Meridian is a state owned enterprise and returns dividends to the government so taxpayers have a legitimate interest in the smelter paying a top price for a national resource. So has Meridian done a good job on our behalf or is Rio Tinto getting fat at our expense?
Well, the latest contract took three years of bargaining and Meridian is happy with it, saying it adds significant value to the company.
And when one customer accounts for 40 per cent of your sales and is the biggest customer in the country by far, you’re going to give them a reasonable discount whether you’re selling spuds from a corner store or electricity from the deep south.
However the fact Rio Tinto knows Meridian can’t sell much of Manapouri’s power to anyone else because of transmission constraints undoubtedly strengthens its hand in negotiations.
For Rio Tinto, for whom electricity is 40 per cent of the smelter’s costs, it’s all about the bottom line.
When predictions of power blackouts were swirling throughout autumn, Rio Tinto agreed to cut five per cent – and then another five per cent of its electricity consumption.
While this was couched in terms of a generous gesture to help the country’s power situation the reality was it was primarily economic rather than altruistic. With spot prices leaping to over 30 cents a kWh, the smelter was keen to cut an unsustainable cost. When Meridian (who was running short of power to provide its other customers and being forced to buy extra on the expensive spot market) asked it to go a little bit further, it’s understood Rio Tinto was compensated for shutting down more pots.
Reports that the cuts have cost the company millions of dollars should be seen in this light.
As economist Rod Oram puts it, Rio Tinto gets “a hugely sweet deal”.
He says the Tiwai smelter is in a fantastic position to market its aluminium as a green product, because its electricity doesn’t come from a coal gobbling power plant, and was amazed when it claimed the government’s emissions trading scheme could force the smelter’s closure.
“Some particulars may need to be worked out but to leap from the particulars to the cataclysmic is incredibly bad strategy on their part.”
Oram says just what economic benefit the smelter has brought to New Zealand has never been resolved because some of the numbers required for a full analysis remain secret.
(Rio Tinto is currently preparing its own study to quantify the smelter’s value to the country and community, expected to be released shortly.)
Many, including Geoff Bertram, suggest we must be able to use 15 per cent of the country’s electricity more efficiently and more profitably than in a single aluminium smelter that produces 4.5 per cent of New Zealand’s export earnings, employs just 0.06 of the country’s workers and sees all the profits go overseas.
But Oram says it’s impossible to know whether this would be the case unless you could compare it with another economic activity that would use the power the smelter currently swallows.
“On balance, I’m saying, well, it’s here, so we might as well make the most of it.”
***
So while it might be an economic dinosaur, a harbinger of the country’s misjudged Think Big projects; while it might throw its weight about and expect privileged status; while its economic benefit is arguable, there seems little likelihood the smelter will waltz off in the near future.
The reason why attention has again been focused on it this year is inarguably due to talk of tepid showers and blackouts. If the hydro lakes had been full and power plentiful, everyone would have happily ignored the enormous amount of electricity this one factory uses.
But the hydro lakes weren’t full – in fact the inflow for the three months to mid-June was the lowest since 1947.
Adding to the fact less power could be generated from hydro stations, another power station packed up and other plants were forced to reduce generation.
To stave off power cuts it was necessary to kickstart an expensive diesel-fired emergency generator at Whirinaki and restart part of an asbestos-riddled plant in New Plymouth. For a country with a wealth of generation resources – rivers, strong winds and geothermal steam – our electricity system looked like a bogged up Lada limping through winter.
And it’s hardly a new situation – there have been four winter shortages in the last eight years that led the smelter to cut production.
But Energy Minister David Parker says that given it was such a dry year and given there were unforeseen plant failures, the fact we survived without blackouts shows how resilient the system actually is.
Electricity Commissioner David Caygill, whose job it is to ensure a secure power supply, agrees, saying talk of a power crisis were largely a media beat up.
“The words challenge or problem sound much less interesting.”
Caygill who sits in a harbour-view Wellington office, ironically a few floors below the offices of Rio Tinto Alcan and Sumitomo Chemicals, says 4000MW of potential electricity generation is being built, consented or applied for – an enormous wave of power he’s confident will satisfy the country’s electricity demands into the future.
Thus, talk of shutting down the smelter to save the lights going out is naïve and pointless, he says.
And that’s possibly the final reality – if more generation comes on stream soon and talk of blackouts disappears, everyone will forget about the smelter and its arguably inefficient use of so much power.
It may be a relic, it may even be a rip off, but maybe we just have to accept it’s here to stay.
The Power of One
As the country emerges from another winter with threatened power blackouts, Mike White investigates why one factory, the Tiwai Pt aluminium smelter, is allowed to swallow nearly 15 per cent of the country’s precious electricity and asks whether it’s time they shut up.
He wore a serious suit and a whiff of hair product. She wore black, and the rimless glasses of generations of librarians.
Paul Hemburrow and Xiaoling Liu had come to Parliament’s finance select committee with dark dress and a grave message from their employer, aluminium colossus Rio Tinto Alcan (formerly Comalco): Carry on with your climate change legislation and we’ll have to close our aluminium smelter at Tiwai Point near Bluff.
Ms Liu, Rio Tinto Alcan’s Asia Pacific president of primary metal had jetted in, in a show of strength from the world’s biggest aluminium company.
But the most telling line was left to Paul Hemburrow, the 38-year-old Australian who heads the company in New Zealand and is the smelter’s general manager.
“What we are saying is that if the bill proceeds as it’s currently written, it is likely to put us on the pathway to closure.”
In the velvet-gloved world of political lobbying and PR, this bore all the subtlety of cudgelling MPs with a fencepost.
Hemburrow’s argument was that being asked to share a portion of the country’s greenhouse gas responsibility was a financial bridge too far, leaving it so cash strapped, so marginal, it would have to shift elsewhere.
What may not have been understood by many, as Rio Tinto Alcan offered this scenario of gloom and grief back in May, was the company’s obligations would be heavily subsidised, only having to pay 10 per cent of its 2005 greenhouse gas emissions until 2019 - it wouldn’t have to pay its full dues until 2030. Moreover there would be two reviews of the scheme to ensure it wasn’t an unfair imposition.
Nor would many have been aware that Rio Tinto Alcan New Zealand, which owns nearly 80 per cent of New Zealand Aluminium Smelters (the remainder owned by Sumitomo Chemical Company of Japan), is hardly on the verge of collapse – with aluminium prices soaring to over US$3000 a tonne (having nearly doubled since 2004), last year it had revenue of $1.1 billion and profits of $204 million. Its parent company, Rio Tinto, is scarcely an international sprat either, last year having paid US$38.1 billion for Alcan to dominate world aluminium production. It’s the world’s third largest minerals company, has operations in 61 countries, 25 other smelters and its 2007 profit was US$7.4 billion.
Fewer still would have bothered to do the sums, as economist Rod Oram did, that suggest even with an extremely high price of carbon the eventual cost to the company would actually be minimal – around 3 per cent.
And as people shivered at the thought of Southland’s second largest employer disappearing after nearly four decades, it’s a fair guess that most wouldn’t have realised Hemburrow’s tactless threat was an echo of one made by successive smelter chiefs: Push us, squeeze us and we’ll piss off.
***
This is how aluminium is made:
Bauxite, a pebbly red material, is mined and refined into a white powder, alumina. This is then dumped into a chemical bath, simmering at nearly 1000 degrees C, through which huge amounts of electricity are passed causing a reaction that creates aluminium and spills off CO2. It’s clever, but it ain’t new – the technique that nearly all the world’s 260 smelters still use was invented in 1886, has changed little and simply relies on enormous quantities of electricity – in Tiwai’s case close to 15 per cent of everything used in New Zealand or the amount used by 625,000 homes.
This is how a smelter is made:
In 1956, Australian company Consolidated Zinc approached the New Zealand government about constructing a smelter, indicating it would come here if guaranteed a large source of electricity.
Serendipitously, as early as 1904 the government had considered the hydroelectric potential of Lake Manapouri, buried in the Fiordland heartland, so the two ideas were meshed and the parties became industrial dancing partners. Initially Consolidated Zinc (which soon became Comalco) was going to build both the Manapouri power station and a smelter at Tiwai but by 1961 said it didn’t have enough money so the government built the power station.
However a special Act was passed in 1963 giving the company rights to the station’s power for 100 years.
In 1969 the first electricity was generated from Manapouri and in April 1971 the first aluminium smelted at Tiwai.
Today the fruit of that coupling can be seen south of Invercargill, where the Southern Ocean finally beaches itself after journeying from Antarctica.
Twin columns of pylons carrying Manapouri’s energy loom from the landscape, straddle the road to the smelter in a quietly hissing colonnade, then swing off across flax fringed swampland, tiptoe across Awarua Bay and sling their wires for a further kilometre to the smelter, tucked in the curl of Tiwai peninsula across from Bluff.
It essentially takes the entire output of Manapouri, our country’s largest hydroelectric power station, and pays roughly a quarter of what you pay for your power.
For something that consumes so much of the country’s electricity, the smelter’s a disappointingly unremarkable destination with sulking buildings in variegated grey, as if all the colour has been leached from them after decades of industrial effort. Only a smoke stack rises from these lower case roofs, like an exclamation mark signalling the smelter’s steadfastness.
Three strands of barbed wire atop a mesh fence and several warning signs make it clear this is smelter territory – its own world at the end of the world.
Inside however some of the purest aluminium in the world is manufactured – up to 99.98 per cent unadulterated – with a third of its production used for cellphones, computers and the wings of the new Airbus A380 aircraft. (Some is also used for less exciting purposes, such as window frames and packaging foil.)
The smelter is essentially four lines of “pots” – the cells where alumina from Australia is constantly mixed with Manapouri electricity. At Tiwai, 672 pots produce about 350,000 tonnes of aluminium annually – just under one per cent of the world’s production. Nearly 90 per cent of this is shipped to predominantly Asian markets from a wharf that stretches into Bluff Harbour like a half-submerged fenceline.
Though you can stare down an entire 600m potline and see nobody, such is the quiet, almost subterranean process of aluminium smelting, the site employs 915 fulltime staff and contractors and studies estimate another 1600 Southland jobs may rely on the smelter’s existence.
Locally, it’s considered a good employer – more than 100 staff are members of its 25-year club, a handful having worked there since it started, and it paid $78 million in wages last year with its average pay higher than the area’s mean.
It contributes to the community in many other ways, from school science fairs to helping save the kakapo and you’d struggle to find opponents to it along Invercargill’s pavements.
The irony is though, the smelter was born amidst controversy, has attracted criticism throughout its life, and still, somehow, finds itself defending its right to be here. Because not only does the smelter often threaten to quit the country, others have long called for the government to show it the door.
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Deep deep beneath Lake Manapouri, the hum of the power station becomes a controlled roar the closer you get to its heart. Seven massive turbines are constantly spun with water that’s plummeted 166m from the lake’s surface and then, it’s job done, set flowing 10km through the mountains to be discharged into Doubtful Sound. It’s one of New Zealand’s great engineering feats but it came at a great cost with 16 men being killed - and almost at the price of a great lake.
Initial plans for the power station that would feed Tiwai’s smelter called for Lake Manapouri to be raised by up to 30m.
The country’s largest environmental protest, including a 265,000-strong petition, eventually saved the lake from what’s now unthinkable desecration.
Save Manapouri became a slogan for a generation and ushered in a new era of environmental awareness.
The smelter was inevitably sullied by association with the plans but it was its operation and tactics that soon became the focus.
In 1970 it was revealed preferential Comalco shares had been offered to influential New Zealanders including politicians, local councillors, judges and journalists.
Public concern rose as it emerged how cheaply Comalco was getting power and how many breaks it had been cut by a government desperate to lure foreign investment.
Its favoured status was reinforced in 1972 when electricity supply to Dunedin was disrupted so the smelter could maintain production.
Later studies showed the smelter paid minimal tax until the mid-1980s, because of depreciation allowances in its agreement with the government.
The country’s growing intolerance of such colossal projects became evident when a second smelter proposed for Aramoana near Dunedin in the 1970s was canned for economic and environmental reasons after huge protest.
Rio Tinto’s controversial involvement in international events, from dealing with Spain’s fascists in the 1930s to the mired events of Papua New Guinea’s Panguna Mine, has also tarnished the current owner’s image over the decades.
The organisation now known as Campaign Against Foreign Control of Aotearoa (CAFCA) was born largely from opposition to the smelter and how its owners were seen to be ripping off New Zealand.
More than 30 years on, spokesman Murray Horton still beats a drum calling for action against the smelter.
After Rio Tinto’s appearance at the select committee Horton issued one of his inimically blunt press releases headlined: “Rio Tinto, Stop Crying Wolf. Just Close The Bluff Smelter & Bugger Off.”
Horton objects to both the cheap price Rio Tinto Alcan pays for such a large chunk of the country’s electricity and also how successive governments have flinched every time the corporate has flexed its muscle through heavyweight lobbyists and heavy-handed threats.
“Effectively what we’re doing is exporting electricity that they get at top secret, dirt cheap prices. And whenever that’s put under threat they threaten to walk.
“They’ve outwitted all the governments since Holyoake and when New Zealand industry was thrown open to the bracing winds of market forces and economics in the ’80s none of that affected Comalco. They’ve always been big fans of corporate welfare – ie. you and me subsidising their electricity – it’s the biggest bludger in the country.”
Back in the ’60s at a time when the smelter was being built, Horton stood shoulder to shoulder on the front lines of anti-Vietnam War protests with Tim Shadbolt.
Today, however, they face each other across the lines, Shadbolt now Invercargill’s mayor and cheerleader for the smelter.
“The thought of it closing is frightening. We’re less dependent on it now than in the ’70s and ’80s when one in four jobs was associated with the smelter – now it’s only about one in 10 – but it’s still hugely significant.”
Shadbolt has strong historical attachment to the issue – after protesting against the lake being raised he worked on the Manapouri tunnel project for a year during his university days.
“Manapouri was built for the smelter and the smelter was built for Manapouri. So they kind of have a historical right that we’re quite protective about. We built Manapouri for our own benefit really and most of the workers were from Southland or Invercargill. It was a man a mile getting killed and all the New Zealanders killed were Southlanders. So we feel we made the sacrifice, we did the work specifically for the smelter and we should have first right to the electricity.”
And he admits the council tries to keep Rio Tinto happy because the multinational “wouldn’t worry for more than two seconds whether it stays open or closes. I’ve met the directors – to us it’s a huge deal, to most New Zealanders it’s at least a recognised deal, but to Rio, well, it doesn’t really matter.”
Thus, building a new $12 million bridge to the smelter is the latest example of corporate appeasement borne by ratepayers.
“But I still respect and like guys like Murray Horton because they’re patriots in a way, they’re looking at the national interest and you need people like that. And I guess I’m paid, my job is to look after Invercargill’s interests - so I’m a mercenary and he’s an idealist in this situation, so I have to respect him.”
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But what would happen if Rio Tinto did leave, as they’ve threatened and as others are calling for them to do?
For a start, you wouldn’t be able to use half of Manapouri’s power anywhere else. Constraints on the national grid mean you couldn’t get more than about 300MW further north than Roxburgh without a significant upgrade of transmission lines.
Estimates for this work vary between $40 million and $200 million (depending on whether a new line of pylons is needed) and consents could take years to be granted. While Transpower, the state-owned company that runs the national grid, is looking at such scenarios, no upgrade is imminent.
And though Southland’s booming dairy industry could soak up some of Manapouri’s output, its demand would be tiny compared to the electricity hungry beast that is the smelter.
Secondly, even if we could get the power to places like Auckland where it’s most needed, it wouldn’t solve the country’s current shortage of electricity generation, but only delay the need for more windfarms or geothermal plants. New Zealand’s electricity needs are growing by around 150MW a year, so closing the smelter would mean we mightn’t have to build anything for about four years. But then, without significant reduction in our power use, we’d be back to where we are now, worrying if we have enough power to get us through a dry winter.
Electricity Commission chairman David Caygill says calls for the smelter to be shut down so we can claw back a large chunk of electricity are a knee jerk, not a sensible, long-term view.
“It’s almost a panic response – the only thing we can think of.”
Thirdly, smelter supporters say that if Rio Tinto left they’d simply re-establish the smelter in a country like China, where its power would probably come from a greenhouse gas emitting coal-powered station, not carbon free hydro like Manapouri. Thus, they argue, the world would be better off if they stay here.
However one obvious scenario would be that if we had Manapouri’s power to use across the rest of the country we could greatly reduce our use of coal and gas such as at the Huntly power station which produces about 12.5 per cent of the country’s power. Doing this would save the country millions in carbon credits needed to meet our Kyoto obligations and arguably balance the emissions a relocated smelter in China might create.
(Amongst Rio Tinto’s justifications for Tiwai has been exactly this suggestion of “carbon leakage” – that if things get too tough here it might go to China where there are laxer emissions rules and this would end up harming the world’s environment more. This blunt acknowledgement that company profits supersede environmental obligations tends to undermine claims in their sustainability report that they accept responsibility to work towards climate change solutions. Claims the smelter wishes to “show leadership” in responding to climate change also appear at variance with their suggestion in 2005 they build a 600MW coal-powered station to produce their own electricity at a time when they were negotiating a new power contract.)
Fourthly, if the smelter closed, a cornerstone of Southland’s economy would be removed and with it, hundreds of jobs.
However the effect may not be as bad as the smelter’s owners and its supporters have postulated.
Southland’s economy is positively pulsating at present –farm prices have almost doubled in the last year; broadband is available in 96 per cent of the region; coffee brands jostle for supremacy on pavement sandwich boards and it’s a bugger of a place to get a park at peak times.
Large developments are slated in the dairy, forestry and oil industries, the Bluff oyster beds are resurgent and the region is desperate for workers says mayor Shadbolt.
With the lowest unemployment rate in the country (2 per cent), two recent economic reports predict it will need an extra 12,500 workers by 2016 just to maintain its current economic growth.
So if the smelter closed few workers would end up on the dole, especially given claims the smelter would seek to redeploy skilled staff to its other operations overseas. (Though just how many Invercargill workers would opt to transfer to China or the likes of Libya where Rio Tinto has planned another smelter, is untested.)
Nor is it as if Southland hasn’t suffered and survived other huge industry closures – not far from the smelter, Bluff’s Ocean Beach freezing works closed in 1991 with 900 jobs lost.
And while the closure of Fisher & Paykel’s Dunedin factory (430 jobs) and Dannevirke’s Oringi freezing works (466 jobs) made headlines for a day or two earlier this year before the nation shrugged shoulders and carried on, jobs at Tiwai are considered almost sacrosanct by the smelter’s defenders.
Steve Canny, group manager of economic development group Venture Southland, accepts the smelter may be a case of, good for Southland but crap for the rest of the country.
But he says those in the deep south get irritated with “the shallow north” wanting electricity that underpins Southland’s economy without wanting power stations built on their patch.
“I can understand how an urbanite in Auckland could be a bit nervous if the power started going out. But unless there’s substantial investment in a transmission upgrade and the not-in-my-backyard scenario is being addressed in major metros, then this discussion has no substance whatsoever.”
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So just how realistic are Rio Tinto’s threats to leave New Zealand? As mentioned, the company has a history of suggesting drastic action or departure when something upsets it.
It did it when wanting to buy the Manapouri station; when the government proposed carbon taxes; during negotiations over electricity prices and most recently over proposed greenhouse gas emissions charges.
Victoria University senior economics lecturer Geoff Bertram, who’s studied the smelter for more than 30 years, says the latest threat was lamentably predictable.
“It was an example of the bully boy tactics Rio Tinto deploys very effectively. They’re probably the best of all the corporates at this game in New Zealand.
“They have good political lobbying skills and an excellent PR machine and they’ve always played their trump card – if you’re horrible to us we’ll leave. If you have a genuine and credible threat like that you can play it as many times as the government’s prepared to cave in - political leverage is everything. And the New Zealand government is one of the weakest I’ve ever observed in this game – by international standards New Zealand’s a pushover.”
Ironically Bertram’s office, with a career’s-worth of stacked documents threatening to avalanche and bury him come the next big earthquake, looks out on the Beehive where he says successive Ministers and governments have buckled before the smelter’s owners.
“Were I the government I’d have long ago instructed officials to prepare a fully-costed contingency plan for compensating all the people that would suffer in Southland if the smelter closed. And when they came to me and said, ‘if you don’t do our will we’ll close the smelter,’ I’d be able to say, ‘all right, off you go, and I’m going to spend the necessary cash not on subsidising your operation but on making sure the ordinary New Zealanders who depend on you for a living can make a transition to a sustainable alternative – have a nice day.’”
In two earlier reports, Bertram calculated the smelter had a negative economic impact on New Zealand in its first 20 years.
Now, he says, on balance it’s probably had a moderately beneficial effect through taxes, wages, port fees and buying supplies locally.
But he says its benefits are nothing compared to say the tourism sector yet the aluminium industry wields a much larger stick politically – vastly disproportionate to its actual economic contribution.
“It’s the small business stuff that makes the New Zealand economy tick, it’s the big monopoly giants that make the government crawl.”
Rio Tinto’s influence in New Zealand isn’t unique.
In his book Running From The Storm, one of Australia’s foremost climate change commentators, Clive Hamilton, notes:
“The (aluminium) industry has repeatedly managed to bully and bluff governments into giving it special concessions and has constantly retarded progress towards resolving the greenhouse issue. It has without doubt been the most self-serving, uncompromising lobby group in the climate change debate in Australia.”
Rio Tinto has a bauxite mine, two alumina refineries and two smelters in Australia.
Across Molesworth St from Geoff Bertram’s office, Climate Change Minister David Parker rejects the notion he’s unwilling to stand up to the smelter owners, insisting the government is determined to push through its emissions trading legislation and calling Rio Tinto’s claims “exaggerated” and “an idle threat”.
“I think we all know that business is about money and in the end businesses are largely motivated by effects on their profit and loss. So they try and minimise things that increase their loss. And that’s what Rio Tinto’s doing here – I wouldn’t call it improper but I see it for what it is.
“They’ve got a private interest in minimising the amount of responsibility they have to take for the cost of their emissions. Now, there’s a cost to the country for their emissions but from their perspective they’d rather the taxpayer bore the cost than them.
“And I don’t think the burden upon them is large in relation to the profitability of their business.”
Parker, who is also Energy Minister, says Rio Tinto is clearly only in New Zealand because it gets a competitive power price and the Tiwai smelter is in fact very well placed compared to other smelters that rely on electricity from coal and gas fuelled stations.
“We don’t think they’ll close. I’ve got no doubt the country would survive (if it did) but it’s not something we’d have as an objective. It’s clearly a substantial employer and a substantial contributor to the Southland economy – but that doesn’t mean we’d have it there at all costs.”
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Paul Hemburrow insists he stands by his assertion that the smelter would end up closing under current emissions trading legislation. But given such certainty, he’s strangely reluctant to say when this might happen, merely suggesting “you can do the numbers” – a bizarre statement considering how secretive the smelter is about its costs.
He stresses Rio Tinto supports emissions trading and is happy to pay its share – but just not unless all other smelters in the world face the same costs. (It should be noted the smelter has reduced CO2 emissions 42 per cent since 1990, despite upping production 27 per cent.)
Nor will Hemburrow countenance suggestions the smelter gets cheap power let alone that taxpayers and other electricity users effectively subsidise the giant multinational.
“The contract price we have is an outcome of a commercially very robust negotiation,” says Hemburrow wielding a shield of business jargon.
“I think there’s a misconception it’s a particularly cheap price, because it’s certainly not.”
Well, maybe not cheap in the hungry world of aluminium smelting – but certainly much cheaper than anyone else in New Zealand gets it would appear.
Neither power supply company Meridian Energy or Rio Tinto will disclose the price the smelter pays, predictably insisting it’s commercially sensitive.
But using industry figures and the smelter’s own accounts it’s possible to estimate roughly how much Rio Tinto pays for its electricity – somewhere between 5.2 cents and 5.9 cents a kilowatt hour.
By comparison the average price for other industrial consumers in 2007 was 9.2 cents and residential customers 18.6 cents.
The smelter’s current contract runs till 2012 but it’s already negotiated another deal from 2013 to 2030 with Meridian.
Presently it has a fixed contract for about 90 per cent of its electricity, buying the remainder from the spot market, paying a price that can fluctuate wildly.
Meridian is a state owned enterprise and returns dividends to the government so taxpayers have a legitimate interest in the smelter paying a top price for a national resource. So has Meridian done a good job on our behalf or is Rio Tinto getting fat at our expense?
Well, the latest contract took three years of bargaining and Meridian is happy with it, saying it adds significant value to the company.
And when one customer accounts for 40 per cent of your sales and is the biggest customer in the country by far, you’re going to give them a reasonable discount whether you’re selling spuds from a corner store or electricity from the deep south.
However the fact Rio Tinto knows Meridian can’t sell much of Manapouri’s power to anyone else because of transmission constraints undoubtedly strengthens its hand in negotiations.
For Rio Tinto, for whom electricity is 40 per cent of the smelter’s costs, it’s all about the bottom line.
When predictions of power blackouts were swirling throughout autumn, Rio Tinto agreed to cut five per cent – and then another five per cent of its electricity consumption.
While this was couched in terms of a generous gesture to help the country’s power situation the reality was it was primarily economic rather than altruistic. With spot prices leaping to over 30 cents a kWh, the smelter was keen to cut an unsustainable cost. When Meridian (who was running short of power to provide its other customers and being forced to buy extra on the expensive spot market) asked it to go a little bit further, it’s understood Rio Tinto was compensated for shutting down more pots.
Reports that the cuts have cost the company millions of dollars should be seen in this light.
As economist Rod Oram puts it, Rio Tinto gets “a hugely sweet deal”.
He says the Tiwai smelter is in a fantastic position to market its aluminium as a green product, because its electricity doesn’t come from a coal gobbling power plant, and was amazed when it claimed the government’s emissions trading scheme could force the smelter’s closure.
“Some particulars may need to be worked out but to leap from the particulars to the cataclysmic is incredibly bad strategy on their part.”
Oram says just what economic benefit the smelter has brought to New Zealand has never been resolved because some of the numbers required for a full analysis remain secret.
(Rio Tinto is currently preparing its own study to quantify the smelter’s value to the country and community, expected to be released shortly.)
Many, including Geoff Bertram, suggest we must be able to use 15 per cent of the country’s electricity more efficiently and more profitably than in a single aluminium smelter that produces 4.5 per cent of New Zealand’s export earnings, employs just 0.06 of the country’s workers and sees all the profits go overseas.
But Oram says it’s impossible to know whether this would be the case unless you could compare it with another economic activity that would use the power the smelter currently swallows.
“On balance, I’m saying, well, it’s here, so we might as well make the most of it.”
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So while it might be an economic dinosaur, a harbinger of the country’s misjudged Think Big projects; while it might throw its weight about and expect privileged status; while its economic benefit is arguable, there seems little likelihood the smelter will waltz off in the near future.
The reason why attention has again been focused on it this year is inarguably due to talk of tepid showers and blackouts. If the hydro lakes had been full and power plentiful, everyone would have happily ignored the enormous amount of electricity this one factory uses.
But the hydro lakes weren’t full – in fact the inflow for the three months to mid-June was the lowest since 1947.
Adding to the fact less power could be generated from hydro stations, another power station packed up and other plants were forced to reduce generation.
To stave off power cuts it was necessary to kickstart an expensive diesel-fired emergency generator at Whirinaki and restart part of an asbestos-riddled plant in New Plymouth. For a country with a wealth of generation resources – rivers, strong winds and geothermal steam – our electricity system looked like a bogged up Lada limping through winter.
And it’s hardly a new situation – there have been four winter shortages in the last eight years that led the smelter to cut production.
But Energy Minister David Parker says that given it was such a dry year and given there were unforeseen plant failures, the fact we survived without blackouts shows how resilient the system actually is.
Electricity Commissioner David Caygill, whose job it is to ensure a secure power supply, agrees, saying talk of a power crisis were largely a media beat up.
“The words challenge or problem sound much less interesting.”
Caygill who sits in a harbour-view Wellington office, ironically a few floors below the offices of Rio Tinto Alcan and Sumitomo Chemicals, says 4000MW of potential electricity generation is being built, consented or applied for – an enormous wave of power he’s confident will satisfy the country’s electricity demands into the future.
Thus, talk of shutting down the smelter to save the lights going out is naïve and pointless, he says.
And that’s possibly the final reality – if more generation comes on stream soon and talk of blackouts disappears, everyone will forget about the smelter and its arguably inefficient use of so much power.
It may be a relic, it may even be a rip off, but maybe we just have to accept it’s here to stay.
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