Dunne deaf to cries of asset sales protesters

Protest cries rang out across Johnsonville this morning as anti-asset sales groups marched through the streets.

People’s Power Ohariu, which was formed to oppose MP Peter Dunne’s vote in favour of the sales, joined forces with the hikoi that has been marching throughout the North Island.

The hikoi is protesting against a range of issues, including deep sea oil drilling and the selling of Crafar farms.

The protesters, holding placards proclaiming ‘Aotearoa is not for sale’, met in the car park of Johnsonville Mall.

They marched down the main road, before ending up outside Peter Dunne’s office.

The focus on the Ohariu MP is the result of his parliamentary vote in favour of the sales, which protesters claimed he did not have the mandate to do.

If Mr Dunne were to change his vote, the sales could not go ahead.

The protesters who delivered impassioned speeches outside Mr Dunne’s office made their feelings towards his actions clear.

“If you really love this land, if you really care about people in this land, then I appeal to your intelligence and your conscience. I think you should really say no,” said Frances Kuo of People’s Power Ohariu, to shouts of agreement from other protesters.

However, Mr Dunne has repeatedly refused to discuss the sales with those opposing them.

In an email to Richard Goldsbrough, the Ohariu Citizens Select Committee spokesperson, Mr Dunne made it clear that it was unnecessary to discuss the matter in person.

“As our respective positions on this issue are well-known, and not going to change, I see little value or point in a meeting, and therefore decline your request,” the email reads.

The protesters plan to meet again for a march from Te Papa to Parliament at 12pm today.

Click here to see all pix

Increase the Tax on Profiteering Aussie Banks

Squeeze them until it hurts
.

The Government is asking loaded questions about how  Christchurch’s multibillion dollar post-earthquake recovery will be financed? There are less than subtle hints about flogging off Christchurch’s large and very valuable portfolio of publicly-owned assets. Wrestling back some of the ill-gotten gains of the big foreign banks is a much more palatable alternative. 

News that the Big Five Australian-owned banks made a combined NZ profit of $3 billion in 2011 means only one thing – they’re making too much money out of us. They must be laughing all the way to the bank. Hang on, they are the bank.
.
These banks always make a big PR fuss about how much they contribute to the NZ community. But these are exactly the same banks who, in December 2009, settled out of court with IRD for attempting to dodge payment of an astonishing $2.2 billion of taxes that, between them, they avoided via deliberately complicated structured financial transactions. And that out of court settlement was for 20% less than what IRD was seeking – plus they would have had to pay costs if they’d persisted in going to court and losing (two of them had already lost in court before they all decided to throw in the towel).
.
So that's how they rode out the recession, by not paying nuisance costs such as taxes. Not an option for the rest of us mugs who have to pay our taxes, whether we like it or not. This was the biggest tax avoidance case in New Zealand’s history – and it happened at the same time as the deposits in those Australian-owned banks were guaranteed by New Zealand taxpayers (who got no say in the governance of those banks).
.

The Government wrings it's hands
about the global financial crisis while
super profits are sucked out of the country 

As a result they paid 47% more tax in 2011 than they did in 2010. But they still sucked $3 billion out of the country. These super profits need to be taxed more. This comes at a time when the Government is wringing its hands about how is it going to finance NZ’s recovery from the global financial crisis? Its’ only ideas are to borrow more; sell public assets; slash the State sector and public services; and bash beneficiaries. Here’s an idea – instead of grinding the faces of the poor to pay for a global crisis caused by the crimes of transnational banks, it should raise the tax on the transnational banks that are creaming it here in this country. 
.
Specifically the Government is asking loaded questions about how will Christchurch’s multibillion dollar post-earthquake recovery be financed? There are less than subtle hints about flogging off Christchurch’s large and very valuable portfolio of publicly-owned assets. Wrestling back some of the ill-gotten gains of the big foreign banks is a much more palatable alternative. Make the rich pay.
.
That would be poetic justice in the case of at least one of those Aussie banks. One of the reasons why Westpac was selected as one of the eight finalists for the 2011 Roger Award for the Worst Transnational Corporation Operating in Aotearoa/New Zealand was because, shamefully, it pressured its Christchurch tellers to meet normal sales targets by pushing loans and insurance products onto financially stricken Christchurch customers after the earthquakes, adopting a “business as usual” policy. That bank can definitely afford to pay more tax. It paid its’ Chief Executive Officer $5.8 million and $5.4 million respectively, over the past two years, making him the highest paid CEO in NZ.
.
Squeeze them until it hurts. They've been bleeding NZ dry for too long.

NZ FACES A STARK CHOICE OVER STRATEGIC ASSETS

- Bill Rosenberg

It is positive and significant to see the beginnings of a national consensus forming around the protection of strategic assets from overseas control. The Government is to be congratulated on its recent change to the Overseas Investment Regulations, even if it is late in the day. We have yet to see what National means when it says it favours 51% New Zealand ownership, but that is a big change in their previous attitudes. The question for all parties is what can they do to make this policy a reality?

If the Government’s way of doing it – an amendment to the regulations controlling overseas ownership of sensitive land – seemed Mickey Mouse, it is because that is just about the only loophole it has left for anything approaching economy-wide protection of our assets. Commitments made by the National government in 1994 to the World Trade Organisation under the General Agreement on Trade in Services (GATS) left following governments with limited options. There were exceptions in the commitments for some sectors, but swathes of the economy were bound into a promise not to tighten the 1994 level of protection – even then very fragile.

Subsequent trade and investment agreements which National and Labour have signed with Australia, Singapore, Chile and others have widened those commitments even further. The 2001 agreement with Singapore for example both broadened the list of sectors affected and significantly reduced the options available to this and future governments. The laws screening overseas investment where no land or fishing quota is involved are totally ineffectual: no application has been turned down for decades because there is no real power to do so. But at least governments had the right to tighten them before these international agreements were signed. The main useful exception governments have retained has been where land is involved. Hence this strange piece of machinery.

New US Agreement Will Wipe Any Remaining Rules On Foreign Investment

But while one arm of Government is trying to repair the damage, however awkwardly, another appears to be preparing to exacerbate the problem. The Ministry of Foreign Affairs and Trade recently announced the opening of negotiations with Singapore, Chile and Brunei to extend a two year old trade and investment agreement (the grandly named Trans-Pacific Strategic Economic Partnership – often known as the P4) into investment and financial services. Any extension into investment would certainly limit the Government’s right to regulate overseas ownership of New Zealand assets.

What makes these negotiations especially significant is the announcement that the US is joining in. The US signals its interests well in advance. The Office of the United States Trade Representative, which is responsible for negotiating such agreements, publishes an annual assessment of what US companies regard as “trade barriers”[i]. The latest one is for 2007. Its assessment of New Zealand included a description of the current overseas investment legislative rules and the statement: “The United States has raised concerns about the continued use of this screening mechanism”.

It can therefore be taken as a certainty that the US will be trying to remove these protections, feeble though many of them are. One of the prices of an agreement with the US will be to back down on our control of our own strategic assets. The US already has some draconian investment rules with both Chile and Singapore that can be enforced by US companies, not just the US government. They will insist that these be made more extensive and accepted by New Zealand.

Governments in the past have tried to justify sacrificing our sovereign rights in this way by pointing to gains bought in agricultural market access. This time however, where only investment and financial services are up for negotiation, anything given away won’t be available for any future negotiations on agriculture. It doesn’t even make sense in tactical terms.

We have been warned. One of the world’s best known economists, Nobel Prize winner Joseph Stiglitz, recently warned New Zealand off even a full trade deal. He told the Sunday Star-Times that “most of these free trade agreements are not good deals… they’re managed trade agreements and they’re mostly managed for the advantage of the United States, which has the bulk of the negotiating power”.

He said there was no real negotiation and “one can’t think that New Zealand would ever get anything that it cares about”. New Zealand’s agriculture interests are head to head against those of the powerful American agricultural lobby. Stiglitz warned: “you’ll lose”.[ii] It’s choice time for the Government, and for whoever wins in the election later this year. Protect strategic assets or negotiate a deal with the US. It can’t have both, and New Zealand will probably lose even if it gets a deal.

This article was published in the Independent 26/3/08. Ed.
[i] See http://www.ustr.gov/Document_Library/Reports_Publications/2007/2007_NTE_Report/Section_Index.html
[ii] “Clinton’s economist warns NZ off US trade deal”, by Anthony Hubbard, Sunday Star-Times, 9/3/08, pA13.

Government Buys Back the Rail - Bout Bloody Time

This is a little delayed as I was distracted with the goings on in Blenheim over the last week so did not have regular internet access.
The news that the Government had bought back the railways was welcomed with a sense of irony considering the railways were orginally sold off, albiet by National, in an environment created by the radical Labour reforms of the 1980's. It's a wierd world we live in when Roger Douglas reappears on the political landscape. Is it even wierder when we buy back a national asset for $665 million?

Below is a CAFCA's response to the (re) purchasing of the Railways


CAFCA CONGRATULATES GOVERNMENT FOR RENATIONALISING RAILWAYS
But Says $2 Would Have Been Fair Price

The Campaign Against Foreign Control of Aotearoa (CAFCA) congratulates the Government for renationalising the railways from Toll. This restores to public ownership a vital part of the national infrastructure that should never have been sold in the first place.

But we think that the $665 million price paid is scandalously high. It is double what the woeful Wisconsin Central and its local collaborators paid to buy the whole lot (including the track network) from the National government in 1993. It is two thirds higher than what this Government could have bought the whole lot back for, in 2003, except that Labour got cold feet and let Toll buy the trains and ferries, while the Government simply renationalised the track network. Now the whole railways has been belatedly, and very expensively, repossessed from its foreign owners - who no longer want it and who couldn’t make a go of it, because that would mean spending money, rather than simply asset stripping and profit skimming.

CAFCA notes that the Government paid $1 to buy back the entire track network in 2003. Allowing a very generous 100% for inflation, we say that the Government should pay Toll $2 to buy back the trains and ferries. Why should the New Zealand taxpayers fork out hundreds of millions of dollars for something that should never have been taken from us in the first place? Rather than lining the pockets of an Australian transnational corporation, that $665 million would do a lot more good alleviating the poverty in which more than 180,000 New Zealand kids have to live, to give just one example.

We’ve regularly said that the bipartisan sell off policy pursued by both Labour and National governments has turned New Zealand into the $2 Shop of the South Pacific. Therefore, we can’t think of a more appropriate price than $2 to pay to buy back one of the key parts of the national infrastructure. We’re even prepared to put up the money.

And the Government once again stands accused of inconsistency in its policy towards foreign control of New Zealand. Just last week Dr Cullen said that it won’t intervene to stop the sale of Vector’s Wellington retail lines network to a Hong Kong transnational because it had already been in foreign ownership twice before. Hello – so why has it, a week later, bought back the railways from its second lot of (hopeless) foreign owners? Electricity is a sector that is crying out for direction and planning, in the national interest. The pending sale of Contact Energy, to yet another foreign owner, as a byproduct of the takeover of its Australian parent, is a further illustration of how this most strategic of infrastructure assets has become the plaything of transnational corporations. All this while the long suffering public is being warned, yet again, of the possibility of blackouts this winter because of the unplanned, profit-driven structure of the electricity sector.

The Government has correctly blocked foreign ownership of Auckland Airport and renationalised the railways from foreign ownership, but it must keep up the good work and act decisively to restore the electricity industry to being one which operates in the national interest.