It’s getting almost sad, how desperate John Key is to sell our assets.
He’s prepared to rush them through more quickly than the market can absorb – trading return for pre-empting the referendum.
He’s prepared to use our money to reward people who can afford to buy shares anyway with illegal bonus shares – in an effort to attract a few marginal retail investors to boost numbers but at a massive cost.
He’ll almost certainly under-price Mighty River – trading return for number of investors.
The indication that shares would be priced for a dividend return of 4%, which, after tax, is half what you get paying off the mortgage – that means, to make it a sensible investment, Key will have to entice investors with the promise of significant share price increase after a float. The only way to do that is to set the price too low.
Now, he’s preparing to overturn convention and ignore the Waitangi Tribunal – the fact that he was raising this option before the hearing shows he expects to lose. Key’s display of comtempt for the Tribunal just because it will apply the law and come to a finding that doesn’t suit him, means he is willing to throw away 25 years of healing over the Treaty just to try to get asset sales through. (and how will the Maori Party react to that?)
It’ll go to the High Court. There’ll be injunctions. Any attempt to sell shares with the question of water ownership unresolved will be a disaster – who would take up shares with such a large question affecting their value unresolved? It will probably end in another expensive share giveaway, this time to iwi.
Meanwhile, something on the order of 3,000 people a day are signing the referendum petition on asset sales.
Key wanted to get asset sales through quickly without too much fuss and without too much connection to his brand. Instead, it is becoming the policy that he is most closely aligned with – they have become Key’s asset sales. He is having to lead on them every day. And his brand is hurting for it.
Isn’t it kind of sad that, when Key looks back on his 5-6 years at the top, his signature policy will be one that made no economic or fiscal sense - it was just a wealth grab for the rich? Or would that epitmose his time as PM?