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The Standard

Economic genius

Written By: - Date published: 9:58 am, April 22nd, 2012 - 41 comments
Categories: economy, humour, john key - Tags: , , ,

Behold the economic genius of John Key. On the profits of capitalism being fair reward for risk:

“…you can’t expect their shareholders to invest for six years without certainty of their investment.”

On being creative and ambitious for New Zealand:

We’re not building the locomotives there [Hillside] because we’ve never built locomotives in New Zealand…

The Brighter Future. Any minute now…

41 comments on “Economic genius”

  1. ghostwhowalksnz 1

    Didnt build locomotives in NZ ?

    The tight curves and steep gradients meant most standard locos were unsuitable for NZ.

    New Zealand Manufacture
    A proud period of steam locomotive manufacture in New Zealand began in 1887 when Scott Brothers in Christchurch built 10 for use on the Christchurch-Lyttelton service. Two years later the first of the nearly 400 locomotives to be built by New Zealand Railways in the period up until 1956 was manufactured at Addington. Other NZR workshops were at Petone, Hutt, Newmarket and Hillside. A further 123 locomotives were built by A & G Price Ltd in Thames, and others were built overseas to New Zealand designs.
    http://www.techhistory.co.nz/19thcentury/Steam.htm

    Funny how Key had to go overseas to become a major player in the financial-currency trading business but thought the same business would be the next big thing for NZ.
    Someone must have had a quiet word since he changed his tune, so that cycleways were the next big thing

    In fact a major type of locomotive , the Pacific class was ‘invented’ by NZers , initially built by Baldwin and then built in NZ.

    As for the Chinese trains, the RMTU says they are too heavy for the NZ network.
    http://www.stuff.co.nz/national/4466711/New-trains-may-be-too-heavy-RMTU

    Kiwirail says they are lighter than the electric locos running between Hamiton and Palmy but of course thats not where they will be used .

    I have noticed some major bridge rebuilding on the Auckland Hamilton line where the locos will be used. This is only after they have been bought.
    Duuuuh

    Maybe bridge rebuilds should have been included in the cost ?

    “He said the union had tried to get KiwiRail to run them over the weigh bridge but it had not done so and was relying on the maker’s specifications”

    • RedLogix 1.1

      A regular acquaintance of mine is a senior engineer with KiwiRail. I’ve discussed this with him several times. He is unequivocal.

      The new DL locos, flatbed wagons and units for Auckland could have ALL been quite readily been built here in New Zealand.

      There is nothing terribly complicated about it. The engines and traction motors come from either Germany or the US; the traction control system is a standard piece of off the shelf kit, all their wheels are actually made in Australia anyway…. the rest is standard steel fabrication and welding that is totally routine.

      Key flat-out misrepresents when he implies we could not have made them here. A lie in ordinary person’s language.

      Oh … and the DL’s from China are crap. Shoddy welding, substandard fuel piping, wrong cab layout, rusting already, burnt out all their spare traction motors and the scuttlebutt I hear is that the engineer who was unfortunate enough to have gotten tangled up in Sammy Wong’s corrupt little deal has been sacked…. err moved sideways.

      • freedom 1.1.1

        Sounds like fair grounds for an Inquiry. I hope your friend blows the whistle with gusto.
        Ask him if he can call someone to throw the Matangi debacle into the mix.

        • RedLogix 1.1.1.1

          The Matangi decision was made before Dr Cullen brought back KiwiRail. Using local engineering was not an option at the time.

        • ghostwhowalksnz 1.1.1.2

          Whats wrong with the Matangis ?
          But remember even new cars have recalls and new planes have ‘issues’.

          With the CNR DL locos, I first smelt a rat when I found out the diesel engines were from Germany

          “The double-cab DLs came with a German-built 2700kW engine with similar pulling power to the electric locomotives that are used on the main trunk line between Hamilton and Palmerston North”
          http://www.odt.co.nz/news/business/169995/kiwirail-orders-another-20-chinese-locomotive

          My guess is that they will all be on the scrap heap in 15 years, but the engines should still be OK.

          • freedom 1.1.1.2.1

            yeah fair call, the expectation that a delivered product would met the specs paid for is a fantasy in this day and age :)

          • RedLogix 1.1.1.2.2

            Nothing very wrong with the Matangis. There has been several commisioning problems that were the result of the Koreans and the local ABB people not fully talking through the implications of the system running on only 1500vDC. (Most modern rail systems run on much higher voltages these days.). This meant the new trains draw more current under acceleration than Rotem/Mitsui and ABB anticipated… which in turn meant that the essential upgrade of all the substations supplying the network initially didn’t perform as well as hoped. Basically it took some tuning and software mods; plus a lot of re-testing to be sure they got it right.

            Some airconditioning motors failed for related reasons; but have all been upgraded to a correct specification. And there remains a bit of an issue with radio frequency interference, but again much improved from the first units delivered. All these were typical and routine sorts of engineering issues that pretty much always occur on any new project. Overall the standard of workmanship and engineering on the Matangis is very good; in contrast with the CNBR DL’s.

            It’s useful to remember that there is a fundamental difference between building a one-off or boutique item like a train set for the specific and in some cases unique requirements of a our rail system… and a mass production item like a car.

            I should say that I don’t know all this first hand; just surmised from the various details that have filtered my way. However Rotem/Mitsui have stood by their train and resolved the issues.. it just took a bit of time. The last of the new units will be in Wgtn and in service within six months.

            • freedom 1.1.1.2.2.1

              pretty much what i heard but when it was explained to me there were a lot more expletives used in describing the delivery, the quality and the implementation of these trains.

            • ghostwhowalksnz 1.1.1.2.2.2

              The 1500V DC is still fairly common for suburban systems which were built before the war. I understand Sydney and melbourne use it along with dozens of other places. It still is a major system in Japan.
              Mitsui and Hyundai- Rotem should have been able to sort out the current issues well before the first train ran. After all upgrading the infrastructure is part of the ‘delivery cost’ when it is necessary.
              Or does no one in GWRC ( the buyer) know anything about electric trains…then

            • RedLogix 1.1.1.2.2.3

              As I mentioned at the start, the biggest delay came about because Rotem/Mistsui and ABB didn’t properly communicate their design expectations to each other at the outset. GWRC have done a reasonable job of getting this upgrade done considering the limited funding. Bear in mind that the largest part of the project was upgrading infrastructure which had been neglected for decades; the Matangi’s were only a fraction of the total cost.

              Put simply if the govt or ratepayers were willing to stump up, several more substations could have been built and the problem would have gone away.

              With most things in the engineering world there is a three-way trade-off between price, quality and delivery. We got a good price and reasonable quality but with delivery delays and frustrations. I can live with that.

              With the DL’s we got a cheap price, fast delivery… but crap quality. And in the long-run that’s always the worst outcome.

              • ghostwhowalksnz

                I understand that for the ‘low’ voltage 1500v DC system the substations have to be fairly close together.

                Sounds like they ‘knew that’ but like Pike River cut some corners

    • DH 1.2

      Another facet of the rolling stock debacle is that if they’d been built in NZ it would have opened up export opportunities for Hillside…. build a quality product & others around the world would have noticed. Lowest price isn’t the be all to end all in engineering circles.

    • mike e 1.3

      Athony Robbins Can we have a picture of Shonkey pulling the lever on a poker machine jackpoting on the brighter future. Because thats about the only policy national has.
      ConMankey!

    • mike e 1.4

      ConMankeys economic genius more pokies is the answer ,They will be made in China one can only hope there as badly made as the trains they are dumping on us.

  2. freedom 2

    ignoring the ludicrous sense of entitlement expressed by his shareholder comment, here’s one of the Locomotives we never built
    http://www.kingstonflyer.co.nz/gallery.html
    http://en.wikipedia.org/wiki/Kingston_Flyer

    I wish i had seen this story last year. How does he get away with saying lies that blatantly stupid? This guy is meant to be the Minister of Tourism?

    • lcmortensen 2.1

      For his information,the Kingston Flyer locos were built in New Zealand – AB 778 was built at Addington (Chch) in 1925, and AB 795 was built at Hillside in 1927. Even the loco that got wrecked in the Tangiwai disaster, KA 949, was built at Hutt!

  3. bbfloyd 3

    let’s be fair now….. they wouldn’t have been able to sell the hillside workshops(or, more likely, the land it sits on) if they had been busy making carriages…..

    where’s the profit for nationals supporters in that?

  4. bad12 4

    The empty suitcase of intellectual and moral rigour possessed by our current Prime Minister is once more blatantly exposed by this post and the following comments,

    The only questions here would seem to be (1) of is the Prime Ministers ‘mistake’ in claiming that trains have never been built in New Zealand when it is patently obvious that this country has a proud history of such manufacture and design, a mistake of a genuine nature or a ‘mistake’ as in just another lie from the Slippery lips of the one who gave us ”National wont be raising GST”,

    Or (2) is there an upcoming Television event in the nature of ”which country on the Planet is being run by the VILLAGE IDIOT” that we all have not as yet heard about but which our Prime Minister is intent upon securing the starring role in and His ‘stupid’ comments vis a vis the manufacture of trains in this country is but the opening gambit???…

  5. captain hook 5

    John Key is not a genius.
    He is just a smarmy accountant who got lucky.
    and his personal attributes are those of any thug who can use whatever means to standover people and take what belongs to them.

    • happynz 5.1

      +1

    • fustercluck 5.2

      John Key is not lucky.

      He is an extraordinarily well-connected post-capitalist thug with a background deep in the belly of the beast (City of London) working as a minion of the very worst of the worst. He was not a good ‘trader’ he was a croupier well-trained to work at a rigged casino.

      He has always served a set of masters who live far from our shores and is doing an able job of looting the country and its workers on their behalf.

  6. burt 6

    Right, so tendering this work offshore was OK when Cullen did it ?

    [Ah… you’re plainly baiting here. Put up an argument or you’ll get the troll treatment…RL]

  7. As Max Kaiser says “In the 30’s there was Gangsters – now we have Banksters” and they are doing the same thing, and he is right.

    Max Kaiser is on Russia Today channel 96, well worth watching also Thom Hartman “The Big Picture” a current affairs programme about internal America.

    You can see John Key is going down the same path that led America to it’s downfall but not to worry just think of all the money to be made out of NZ on it’s way down.

    • bad12 7.1

      To paint a little piece of detail into the ‘gangster’/ ‘bankster’ comparison one only need examine the currency dealings of our current Prime Minister’s former employers,

      As merchant bankers with vast amounts of cash at their disposal these people ‘speculated’ in the cost of the New Zealand dollar and other nations currency’s on a regular basis, in a lot of these speculations being of amounts that could force the international price of the currency’s targeted up or down at their whim,

      While such ‘speculations’ were at times extremely profitable to those engaged in the practice the end game of such speculation was not those initial high profits,

      By driving the price of the NZ dollar up or down such speculation had dramatic effects upon the returns to New Zealand exporters,negatively effecting upon the profits of all sectors of the New Zealand economy,(and by definition the internal economy as well as the spending of the export sector reflects in local employment and business profitability),

      The ‘end-game’ of such speculation was then to offer the exporters of New Zealand ‘insurance’ against the speculative effect of their actions which would best be described as an ongoing ‘protection racket’ paid to those speculating in the currency to protect against the effects of that speculation,

      No different really than some cheap Mafia type hoods demanding ‘protection money’ from the corner dairy to save the store from being burned down or vandalized…

  8. Rob 8

    Yes he has a history!
    But he is keen on getting more jobs, at casinos, but not so keen to get jobs that create wealth and skills in manufacturing unless they are in another country.

  9. seeker 9

    Quoting John Key from the “economic genius” link article that Anthony R. has posted:

    “In this particular case, we do want SkyCity to invest NZ$350 million. It’s going to create 1,000 jobs while that construction is underway, and 800 permanent jobs, and bring about 100,000 high-value visitor nights a year,” he said.

    What does “100,000 high value visitor nights a year” actually mean? I only have 365 nights in my year and 366 every leap year. Is it something like the 1001 nights?

    • McFlock 9.1

      He thinks that every day of the year 300 people will travel to auckland to lose money to the casino/conference centre, most of which will go overseas, thus providing gainful employment for about the same number of people.
             
      In other words, if you piss money away overseas it’s good, because some mould around the plughole will feed off the nutrient flow

  10. Georgecom 10

    But the Hillside workshops are up for sale because there isn’t enough work for them.

    Hold on, maybe they could have built some wagons, or trains.

    We are not going to give the workshop any more work.
    Look, the workshop is running out of work, better sell it.

    Is this THE finacially dumbest government we have had in NZ, or just ONE of the financially dumbest?

    • Colonial Viper 10.1

      It’s a mistake to think that they’re being dumb.

      They’re being deliberate. Undermining the unions and undermining the economy in Labour held South Dunedin.

      • Half Crown Millionare 10.1.1

        How true, Thatcher did the same to the North of England, she also managed to get rid of the GLC. A great Labour thorn in her side The same GLC that maintained the good water and sewerage systems, which are now falling apart with massive loss of water every day through the lack of care and maintenance (Can’t have care and maintenance and large bonuses and dividends to overseas shareholders) and London Transport with all its R&D and design centre to make buses that were suitable for Londons narrow streets and low bridges. Buses that were a British ikon

        Absolutely disgusting the way the right has sacked and pillage every good bit of infrastructure to make sure their spiv mates get nice handouts.

      • Georgecom 10.1.2

        I guess we have to differentiate between being financially dumb, because you are just thick, and being deliberately dumb, doing it on purpose. I doubt that the government is being dumb just because they are thick. That then leaves being deliberately dumb. That is, thinking that their current mode of operation will deliver the ‘brighter future’ National promised but cannot deliver. The only change necessary, in light of the 2008 financial collapse and ongoing stagnation, is to screw down government spending. Otherwise, it’s neo-liberal business as usual folks.

        That is dumb, but deliberately so.

      • SpaceMonkey 10.1.3

        Yep… we are witnessing a purposeful takedown of the NZ economy to foreign interests. It is happening at speed now as John Key’s Wall St and City of London masters know they’re on borrowed time, so they are attempting to secure as much wealth as they can before global economic collapse. Because it is only a matter of time now – when, not if.

    • Draco T Bastard 10.2

      Par for the course for a NACT government. They’re all financially and economically illiterate. That said, this one may be the worst if what they were trying to do was benefit NZ – which I don’t believe they are.

  11. Maui 11

    Interesting UK Conservative take ..

    “Prospect of President Hollande and collapse of Dutch government raise new questions about €urozone’s future”

    http://conservativehome.blogs.com/international/2012/04/prospect-of-president-hollande-and-collapse-of-dutch-government-raise-new-questions-about-urozones-f.html

  12. Jenny 12

    I felt that this Herald cartoon captured the essence of John Key. The always sunny disposition, the joi de vivre.

    http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=10800727

  13. Geoff 13

    KiwiRail announced in July 2011 that they had ordered a second batch of DL’s from China. Then absolute silence from them ever since. Rumour is, they are attempting to cancel the order, and the legal beagles are trying to get them out of the contract. Behind the scenes, the Chinese government is no doubt reminding our government of their free-trade obligations.

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