ppi.035-Alliance-Labour: hope for New Zealand?

1998-05-30

Richard Moore

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           ppi.035-Alliance-Labour: hope for New Zealand?
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Date: Wed, 20 May 1998
To: •••@••.•••
From: •••@••.•••
Subject: Background material on NZ neoliberal experiments

Rio de Janeiro, May 19/20, 1998.

Dear moderator:

I know in general lines how "good" is NZ as a neoliberal pupil, but I think
it would be very interesting to send to the list the material you referred
to, including parallel imports.   Furthermore, I need it.

The privatization of the electricity supply in New Zealand has brought about
the same disaster that happened in Rio de Janeiro and part of the São Paulo
States, here in Brazil: frequent electricity shortages due to the mass
dismissal of skilful technicians and to the purposeful weakness of the
regulatory authority.

It is ironic that Rio Light, the main electricity supplier in the RJ State
now belongs to a consortium headed by a French state-owned company!

Best regards,
César Roberto

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Date: Thu, 28 May 98
From: janice <•••@••.•••
To: •••@••.•••
Subject: What happens when Washington runs your economy; NZ today.
Sender: •••@••.•••


       FARMERS AND THE ECONOMY

      Speech to Northland Federated Farmers

      Jim Anderton MP
      Leader of the Alliance

      Embargo: 6.00PM 27 May 1998

      The New Zealand Herald earlier this month reported that
      the chief executive of Federated Farmers referred to you
      in these words,

      "It's like having a delinquent child in the household."

      When I read a comment like that I'm reminded of a cartoon
      that was drawn when I left the Labour Party in 1989. It
      featured the Labour caucus huddled together, shouting
      'you're on your own now, Jim'. And it depicted me
      wandering off into the 'wilderness' - where the rest of
      the country was waiting, encircling the Labour caucus of
      the day.

      The message is this: It's not delinquent to do the right
      thing. No matter how many people tell you you're mad, or
      misguided or delinquent, the truth is always the truth.
      Your branch is doing something very courageous. You're
      taking on your own side.

      You're having to question your own history and tradition.
      Fortunately New Zealand has a history of courageous souls,
      prepared to stand up for what they believe in and to
      question the wisdom of others.

      [Colonel Malone, Norman Kirk, Michael Joseph Savage, Judge
      Peter Mahon].

      I know how people feel when they find they no longer share
      common ground with their former allies. It's something I
      went through when I left the party of which I had been the
      President. It's hard to question your own history and
      tradition.

      When you do it, you have to ask yourself a vital question:
      "Is what these people are doing right? Is it what I
      believe in?" If the answer is, 'No', then either what you
      believe is wrong, or what they are doing is wrong.

      You have come to the conclusion there is something
      seriously wrong with the national direction of Federated
      Farmers. And part of that conclusion is your rejection of
      this Government's economic and social direction.

      I've been travelling around New Zealand since the budget,
      speaking to groups all over the country. The mood is
      changing. In hamlets, towns and cities New Zealanders are
      saying they've had enough. The activism of the Northland
      Federated Farmers reflects that mood.

      When a mood begins to grow, it builds a momentum all of
      its own. It's a feeling that was underlined in the
      Taranaki-King Country: National can no longer take for
      granted the support of groups it has always taken for
      granted.

      The days when provincial New Zealand would automatically
      support National are over. And it's about time, because
      that party has abandoned you. National is now the party of
      overseas-owned corporations and Queen St lawyers. And
      people are realising that if you don't like it, the best
      thing to do is to stop voting for them.

      Look at what happened to National in Taranaki-King
      Country. That has been the deepest blue part of the
      country since the National Party was formed. They nearly
      lost it. National got less than 30% of the vote in
      Taranaki-King Country.

      They were thrashed in the two biggest towns, Stratford and
      Te Kuiti. The National candidate told the local newspaper
      he was 'dog tucker' in Stratford and he wouldn't be going
      back there. That's how badly he did there. And do you know
      who won in Te Kuiti and Stratford? The Alliance.

      Who would have believed that heartland towns like Te Kuiti
      and Stratford are Alliance towns? They are. And there's a
      simple explanation. We went to those towns and campaigned
      very hard with a simple message about how New Zealand can
      do better.

      Tonight, I want to talk to you about that.

      What is the reality of provincial New Zealand? Take rural
      Northland.

      Communities are struggling.

      When was the last time a politician ever came to you and
      said, 'If you vote for me I'll close your hospital?' None
      of them ever tell you that. But they keep doing it.
      Between them, National and Labour have closed 57 hospitals
      in the last ten years.

      Now they're removing twenty thousand people from surgical
      waiting lists. These are people who are sick. They have
      been assessed by a doctor as needing operations. And the
      government has decided they're not going to get the
      operations they need.

      And what does the Government say about that? The health
      funding authority said that the knowledge that you won't
      get your operation should 'strengthen your resolve' to
      look after your own health better.

      [* Dr Malpass' press release].

      So that was why Colin Morrison of Southland had to be left
      to die. It wasn't because a cruel government refused to
      give him his heart operation. It wasn't because he lived
      in the wrong part of the country and they couldn't be
      bothered having adequate health services in the region
      where he lived. No. Colin Morrison apparently had to die
      because his resolve wasn't strengthened enough to look
      after his own health.

      The same man from the health funding authority told us
      that if people found out they weren't on the waiting list,
      then that would be a good incentive to 'explore other
      options.' What other options? Praying? Faith healing?

      Why don't they just give people the operations?

      The government tells us it has to save money. It can't
      afford to keep hospitals open and pay for operations. Well
      that isn't true.

      Today you had the pleasure of hearing from Mr Luxton. Mr
      Luxton is one of the brightest stars in the Government,
      according to Mrs Shipley. She must think so, because she
      just promoted him. She says she is 'delighted' with him.
      So let's take her word for it, and see how bright Mr
      Luxton is - one of these people whom Mrs Shipley says is
      the brightest in her government.

      Just before the budget Mr Luxton made a decision to
      immediately remove all tariffs on imported motor vehicles,
      with the loss of 5-10,000 New Zealand jobs. All cars
      brought into New Zealand before 14 February would be
      eligible for a refund of tariffs paid when they came into
      the country.

      His officials said to him, 'hang on a minute, Minister. If
      you do that, people will export their cars and send them
      to Fiji or Australia for a week's holiday, and bring them
      back into the country. The return fare to Fiji is only
      $950, and when they bring the car back, we'll have to hand
      write them out a cheque for $22,000.'

      You know what Mr Luxton did? He said, 'don't worry about
      it. No one will do that. Hardly anyone. It'll only cost
      the taxpayer a few million dollars.'

      The car dealers couldn't believe their luck. They had no
      idea people like this were running the country.

      Next thing you know, you couldn't buy a new car in
      Auckland or Wellington for love or money. They were all
      lined up at Auckland wharf waiting to be loaded on a ship.
      Three and a half thousand for the first two shipments. Ten
      thousand all together.

      When the likely cost to the country reached a hundred
      million dollars the Minister finally realised how stupid
      he'd been and he called it off.

      John Luxton is evidently one of the brightest stars in Mrs
      Shipley's government. And if he could be that cavalier
      about up to a hundred million dollars, why can't we afford
      to keep hospitals open? Why can't a dying man like Colin
      Morrison get his operation?

      When a hospital closes, the doctors and nurses and
      cleaners and kitchen staff and gardeners all lose their
      jobs. Some move away. Others can't find new jobs. If
      families move away their kids aren't going to the local
      school. Their wages aren't being spent at the local shops.
      Those shops can't afford to take on new staff. If a shop
      folds, then there's another family that stops spending its
      income - one way or another - in the local economy.

      If anyone wonders why there is a mood for change in New
      Zealand, its because the National Party doesn't seem to
      realise what's going on in the economy.

      Let's match the promises they made about how they would
      run our country against the reality of how it is.

      They said their policies would make New Zealand grow
      faster.

      Last year the New Zealand economy grew by 1.9%. The
      average growth in all developed countries was 2.9%.

      This year, New Zealand will grow by 1.3%. The average of
      developed countries will be 2.9%.

      Next year our economy will grow by 2.3%. Again, the OECD
      average will be higher - 2.6%.

      Not since 1995 has New Zealand's growth rate matched or
      exceeded the growth rates of other developed countries.

      The National Party call themselves 'sound economic
      managers'. Don't make me laugh.

      They are incompetent. This Government is one of the worst
      performing economic managers in the western world. Our
      growth rates are unacceptable.

      Our debt record is even worse. Wasn't all the economic
      restructuring and asset sales supposed to fix the debt
      problem forever?

      If that was what it was about, they could not have failed
      more spectacularly. New Zealand has never owed more.

      New Zealand has not run a surplus in the current account
      of the balance of payments since 1972. We have had an
      unbroken 25 year run of spending more overseas than we
      earn.

      Last year the current account deficit was 4.8%. This year
      I believe it will reach 8.3%. By next year the current
      account deficit will blow-out to 9.3% of GDP.

      The OECD average is nought: No current account deficit.
      That's the average.

      Australia has a 4% current account deficit. Mexico has a
      3.4% deficit. Even in 1994 when its currency collapsed
      because of the balance of payments, Mexico only had a
      balance of payments deficit of 7.1%.

      What has the continuous run of ruinous deficits done to
      our total debt?

      In 1984 when the Labour party ran advertisements featuring
      Little Olivia, she had a debt of $5000. Now she owes
      $25,479 overseas. And she's 17 and about to get a student
      loan.

      In 1995 our total overseas debt was 69.2 billion.

      In 1996 it was up to 74 billion. This year it will reach
      82 billion dollars. Next year it will exceed 90 billion
      dollars.

      Our overseas liabilities are increasing at the rate of 21
      million dollars a day, or $7600 million a year.

      And where is all that wealth going?

      It's going straight into the pockets of the overseas
      owners we have sold our country to.

      The current account deficit this year is almost exactly
      the same as the sum we sent overseas in profits and
      dividends.

      Imagine the impact on our health and education systems if
      the seven and a half billion dollars we send overseas in
      profits to overseas owners was being invested in New
      Zealand instead. Imagine the difference it would make to
      New Zealanders wage packets!

      Do you think unemployment and marijuana would be the
      biggest growth industries in Northland if just a few days
      of the $21 million a day we are sending overseas was being
      invested here, in Northland?

      Some 220,000 New Zealanders are jobless.

      There are 6500 unemployed people here in Northland. 10.8%
      of the workforce. And this is in an area that is
      exclusively represented by the National Party, and
      virtually always has been.

      Unless we stop selling out our country, this is going to
      keep happening.

      National's claim to be 'sound economic managers' is a sick
      joke. They are failing on debt, they are failing on
      growth, they are failing on unemployment, they are failing
      on interest rates.

      Interest rates: New Zealand has the highest real interest
      rates in the western world. As long as we keep the present
      monetary policy, we will continue to have cripplingly high
      interest rates.

      Those interest rates are forcing up our dollar and the
      combination is demolishing the viability of businesses
      like yours.

      It is an outrageous betrayal of farmers across New Zealand
      that the national leadership of Federated Farmers supports
      the present monetary policy. Why doesn't federated farmers
      just come straight out and say, 'farmers should be driven
      off the land'? They are betraying farmers and selling out
      the country.

      It is hard to think of an economic policy that could be
      failing farmers - and New Zealand - more spectacularly.
      How dare they support it!

      Dairy farmers: 21% of their income goes on interest
      payments. For seven-to-eight years out of every ten, dairy
      farmers will have to export into a market where our dollar
      is over-valued, under current monetary policy settings.
      This is madness.

      Beef farmers getting hammered. 28% of the national beef
      kill is in Northland and its TB free. So if it's
      struggling there, imagine what it's like everywhere else.

      Lockwood Smith has an answer to all this. Lockwood is
      another one of the stars of this Government. He's another
      one of Mrs Shipley's special favourites. Lockwood believes
      the answer to all your problems is to smash the Dairy
      Board into tiny pieces.

      The Dairy Board is New Zealand's most successful business
      and has been for years. It has the over-whelming support
      of farmers around New Zealand. You get the impression that
      Lockwood has taken a careful look at the Dairy Board and
      said,

      "Sure it works well in practice. But it doesn't work in
      theory!'

      Other countries hate our Dairy Board. They want us to get
      rid of it because it is so successful. Massive overseas
      multi-nationals like Switzerland's Nestle company would
      like to buy it.

      So what does Lockwood do? Does he say, 'we're keeping it
      because it's good for New Zealand'? No.

      Does he say, 'we'll only remove the Dairy Board's single
      desk status if you give us trade concessions in return'?
      No.

      He says, 'Well if you want to wreck our winning advantage,
      let me do it for you.'

      Lockwood is one of the brightest stars of this Government.
      He had a starring role in the Taranaki-King Country
      by-election.

      When he turned up at the National party launch, the
      Alliance had a person waiting for him dressed up as a
      chicken. The chicken was carrying a placard, which read,
      'Why is Lockwood too chicken to debate Jim Anderton.'

      So what does Lockwood do?

      First, he tries to run away. Lockwood is scared of someone
      dressed up as a chicken. It reminds you of when he was
      Minister of Education, and tried to climb out a toilet
      window to escape the students!

      While he was inside the meeting, the chicken would squawk
      whenever Lockwood started telling one of his fairy tales
      about his exploits on the international trade circuit:
      Things like, 'Smashing the Dairy Board will be great for
      New Zealand.'

      So Lockwood came outside and started to debate the
      chicken. Imagine the spectacle. Here we have a Cabinet
      Minister, one of the brightest stars in Mrs Shipley's
      Government, one of the Prime Minister's personal
      favourites: And he goes around in a by-election debating a
      person dressed up as a chicken.

      It's about Lockwood's level.

      Lockwood Smith, like John Luxton, is incompetent.

      But this pair are as good as it gets from a government
      claiming it represents rural New Zealand.

      That's why there's a mood out there in rural New Zealand.
      It's why people are starting to say it's time we got rid
      of them.

      The ACT party thinks it will be the beneficiaries of this
      mood.

      ACT is the party which says the only problem with National
      is that it's not going fast enough. It's not destroying
      the dairy board fast enough. It's not selling enough of
      New Zealand off fast enough to overseas ownership. There
      are too many schools and hospitals owned by the public.

      ACT's policy are so hare-brained that when the electorate
      begins to take a close look, they will plummet in the
      polls faster than the value of Brierley's shares with
      Roger Douglas running the company.

      Look at what they're talking about: ACT say they want to
      cut government spending to 20% of GDP.

      That means cutting $15 billion off state spending. How
      would you do that?

      Well it would be no good fooling around with the
      small-biscuits. You have to slash the big ones.

      The biggest spending items for the government are health,
      education and NZ Superannuation. That is where ACT will
      wield the axe.

      * ACT would cut spending on public hospital by a third.
      That would mean no more public hospitals in rural areas:
      They would all be abolished. The hospital not only in
      Dargaville but also in Whangarei, for example, would have
      to go.

      * ACT would cut spending on education by half. If you
      think you have an unemployment problem for Northland youth
      now, just think what will happen when they chop half the
      Government expenditure on education.

      * New Zealand Super would be cut by 35%.

      * Spending on unemployment would almost double: Up by 87%.
      That's even though the unemployment benefit would be
      drastically cut by ACT. Even assuming the unemployment
      benefit was cut by 75% (for example, by making it
      available for only a few weeks), spending on unemployment
      would increase because they would make so many more people
      unemployed. To see how they would create mass
      unemployment, think back to when Ruth Richardson cut $1
      billion out of beneficiaries' incomes. What happened to
      unemployment then? So what do you think would happen if a
      Government tried to cut $15 billion out of spending?

      ACT's policies are economic genocide.

      Political commentators keep telling us that ACT is doing
      well. Really? What political commentator can honestly say
      to you that the public of New Zealand are going to vote
      for a one third cut in health and superannuation, cutting
      education by half and trebling unemployment?

      And ACT policies are exactly where National is heading. As
      coalition partners, there is no policy too extreme, too
      devastating to New Zealanders for them. There is nothing
      they wouldn't sell. There is no social service they
      wouldn't cut.

      * If your interest rates are high now, you better hope we
      never get a National-ACT government.

      * If you think unemployment is high now, you better hope
      we never get the economic lunatics of ACT in bed with the
      incompetents of National.

      * If you think social services like health and education
      are in trouble now, wait until the butchers of National
      and ACT get at them.

      There is an alternative.

      There is going to be an Alliance-Labour Government after
      the next election. Count on it. Bet the farm on it.

      For the Alliance's part, I pledge to you we will do
      everything we can to make it a visionary and progressive
      Government for all New Zealanders.

      The Alliance has just finished work on an alternative
      monetary policy. It spells out in lucid detail the
      alternative to the high interest rate, high exchange rate,
      high unemployment path we're on.

      Our alternative invests in the regions. In rural New
      Zealand. It operates a sane monetary policy and a sane
      foreign investment policy.

      Our alternative makes employment, growth and the balance
      of payments just as important as low inflation in economic
      policy.

      Our alternative ensures that foreign ownership of New
      Zealand is only permitted when it can be shown to be in
      our national interest.

      Our alternative includes innovative and far-reaching
      job-creation programmes including a regional investment
      strategy with government-led investment.

      That is where this country should be headed. That is where
      the Alliance wants to make sure it is headed.

      It is a future that farmers are going to prosper in. It is
      a future that all New Zealanders should, and will,
      welcome.

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