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Regulate this!

Written By: - Date published: 8:14 am, February 28th, 2013 - 172 comments
Categories: david parker, Privatisation - Tags: , ,

There is a lot of call in the comments here for Labour to come out and say they will buy National-sold assets back (at sale or market price, whichever lower) – or indeed take them back.  An announcement will render the assets unsellable.

The view we’ve heard from Labour is that National will have spent all the money in the kitty (highly likely) and there will be no money to buy them back. Take them back and we lose the confidence of the international community.

Now, putting aside more radical ideas of where the money to buy them back could come from (even if some of them have merit – that argument would need winning), I see a middle (but not third) way.

Even among most market believers, the New Zealand Electricity Market doesn’t work.

We’re too small for any sort of proper competition apparently.  I’m dubious that any competition truly works in something so infrastructure dependent as electricity (we don’t want 2 sets of cables everywhere…).  Ideally we’d still own the power companies and be able to scrap the whole idea.

But if we don’t own, we can still regulate.

And we can regulate these companies within an inch of their lives.  Make sure that no “excess” profit is taken (and certainly not offshore). Make sure the right amount is put back and invested into the right sorts of infrastructure renewal and renewable energy.  And a personal hobby-horse – even make sure that a good rate is paid to private households contributing energy to the grid.  A distributed power-supply will be more efficient.

If Labour comes out and advocates heavy regulation on power companies it will certainly depress the price.  Ideally down to a level that National decide to scrap the idea, but that’s unlikely.  So hopefully at least down to a level that we can buy them back piece-by-piece over time.

Max Bradford’s late-90s electricity reforms (to create the “market”) were what outraged David Parker so much that he got into politics, so surely Parker has a better plan for how to organise our electricity sector.  Let’s hear a plan to move towards it.

172 comments on “Regulate this!”

  1. vto 1

    Yep agreed. Regulate.

    For fucks sake, the free private market uses every single tool at its legal disposal (and more) to gouge as much as is humanly possible from old people trying to keep warm at night.

    We should do the same back to them. They are big boys, they can handle it.

    They push to the maximum yet you (the left) do not, and that is one of your major flaws in most everything. Stop being so bloody nice (or whatever it is, weak, dunno). Get stuck in. You owe it to the people.

    • Draco T Bastard 1.1

      +1

      Time to stop compromising in favour of the rich and stand by the principals that will ensure that NZ will become a better place to live.

    • Tom Gould 1.2

      The artificial market the Tories built is clearly failing. With wholesale prices down 22 percent, and demand flat, the retail price goes up, along with the profits? WTF? This was bearable when we owned the generators, but with them on the block and soon to be in foreign hands, it is time to sort out this broken market once and for all. A proper regulator with real teeth is long overdue, and now it is absolutely essential.

      • Gosman 1.2.1

        I didn’t realise that a selling a 49 percent stake equated to the company being in foreign hands. How does that math work out?

        • shaz 1.2.1.1

          Umm. How I wonder? Past experience being the best predictor of future conditions perhaps.

          • McFlock 1.2.1.1.1

            you mad, rash fool, you.

            Don’t you know that the best predictor of future conditions is a 2-dimensional cartesian graph based solely on the fantasies of what would happen on Planet Tory if we were all rational robots who possessed perfect information about the economy?

            • Colonial Viper 1.2.1.1.1.1

              Is Gossie back to the “a 49% sell-off isn’t a real sell-off” spin. Gawd that was so 2011.

      • Shane 1.2.2

        The reason prices are going up is due to network businesses – Transpower and the local distributors are spending to upgrade their assets. This is an area already under price control by the Commerce Commission. Get with the plan mate and stop sprouting nonsense.

        • Colonial Viper 1.2.2.1

          Meh, the reason they have to spend up big now is because they have been sucking capital out of their networks over the last 20 years.

          Get with the plan mate.

  2. Peter 2

    Whilst I support much stronger regulation on the electricity market, this is a little bit of a cop out. We can take the assets back – it’s literally as simple as Labour (and the Greens) saying that we’ll renationalise them upon taking office next year, with people (the mythical Mum and Dad investors that Key and English love so much) getting their initial cash back:

    It works like this:

    1) David Shearer announces that the assets will be renationalised, with compo for investors at current rates (i.e. there is a loss incurred between now and then).

    2) The bottom drops out of the sale, and the sales falter.

    And thus, we keep our assets, Shearer demonstrates leadership on a critical economic matter, and Labour shows itself to be an effective opposition. Helen Clark and Michael Cullen employed this very same tactic with ACC in 1998.

    But of course, this won’t happen, and the reason for it is quite simply – a lack of leadership.

    • ghostwhowalksnz 2.1

      Another reason is that it would ‘an even worse reason than privatizing the assets’

      • ghostwhowalksnz 2.1.1

        ACC wasnt privatized, so you are incorrect in the comparison.

        • Peter 2.1.1.1

          I didn’t say it was privatised. I said that Labour spiked the nascent private insurance market that was developing, and thus, paved the way to get the scheme back in public hands and control.

          Same applies with asset sales.

          • ghostwhowalksnz 2.1.1.1.1

            Completely different situation. No ACC assets were transferred and didnt need to be bought back. Buying back assets unless the business is broken ( like Air NZ and TranzRail) is not really possible anymore. Funnily enough it would take someone like a Key on the labour side to do it. A weak leader like Shearer or Cunliffe dont have enough political capital

            • Peter 2.1.1.1.1.1

              Not really possible. Why?

              Yes, not possible with the current leadership (which you hint at)!

              But it is technically possible. Such a weapon is so powerful you only need to mention it using it.

    • Draco T Bastard 2.2

      +1

      The only response to selling the assets was that they would be renationalised with no compensation. Every left-wing party should have said that as soon as it became obvious that the polls showed that NZers didn’t want them sold.

      • RJLC 2.2.1

        +1

        This ex Labour voter will not return to the fold until such a commitment is made, particularly in regard to the state-owned utilities. Regardless of current party leadership issues.

      • Dem Young Sconies 2.2.2

        +2

        This is the only threat that would actually derail the sale process, and stop it dead. The last thing that the rich like to do is throw their money away. If it becomes clear that this will be the outcome of buying shares, there will be no takers.

        On a side note, the parties of the left should also have companies like Contact and Nova in the line for renationalisation without compensation. Same goes for the banks, Fonterra, supermarkets etc. Monopolies and oligopolies of this side are so important that they should only exist for the benefit of the people; not as a means to milk the country for money.

        • Shane 2.2.2.1

          Wow. Lets nationalise everything and turn into a basket case that the Soviet Union turned out to be. Why stop at Fonterra and supermarkets, why not all the shoe repairers? There are not many of them around, yet they still gouge me on the price it costs to fix my shoes?

          Seriously, nationalisation is not the answer IMHO. We have the Commerce Commission to regulate monopoly type businesses. Agree, that ComCom aren’t correct always. The alternative with nationalisation is a flight of capital offshore, to the detriment of local investment.

          Also, if excessive pricing is occurring. or service is not meeting expectation the market will react with new competitors. Look at cafes coffee carts as a example.

          • Draco T Bastard 2.2.2.1.1

            The alternative with nationalisation is a flight of capital offshore, to the detriment of local investment.

            We don’t need foreign investment. That’s a lie cooked up by the banksters.

          • Draco T Bastard 2.2.2.1.2

            BTW, it’s pretty much impossible to get new competitors in electricity due to the nature of the infrastructure. It’s also far more efficient to use a state monopoly.

      • Gosman 2.2.3

        Yes! I would love it if someone serious on the left came out with that policy. It would then be a small step to predicting that your home is next on the list. The middle classes would desert the left in droves.

      • QoT 2.2.4

        You wouldn’t think it was that fucking difficult to say, would you? With back-up messages like “we’re sending a clear signal to the market” and “some things are too precious to be left to profiteering asset-strippers” and “Mums and Dads can’t afford first homes, how does this government expect them to buy shares?”

    • JonL 2.3

      ”Lose the confidence of the international community” would this be the same community that sees NZ as an easy mark, to loot, intimidate and generally treat as a retarded backwoods hick with a government all too eager to come running and obey at the snap of fingers………..

      • Draco T Bastard 2.3.1

        Yeah, that community, the one that’s been screwing NZ over for the last few decades.

      • aerobubble 2.3.2

        Labour and National have bent over to get LoR and the Hobbit movies. But Key did something far worse, when the film companies started demanding law change all Key needed to have said back, was why would you harm your market, many unionists have kids who want to see your movie.

      • Yeah I don’t think that’s a bad thing. Pillagers need not apply.

    • The Chairman 2.4

      A cop out, indeed, Peter.

      And I hope this thread is not a softening for the position.

      We won’t lose the confidence of the international community if a ‘buyer beware’ policy was announced before any listings proceed.

      However, not doing so will cost voter confidence in the Labour Party.

      A growing number of people are questioning Labour’s lack of commitment to later reverse policy they currently oppose.

      Moreover, the cost of borrowing is currently less than the rate of return.

      • Peter 2.4.1

        Honestly, if this thread is being used as a softening, or a test for a softening, it wouldn’t surprise me. But then, according to Shearer, “no one reads blogs”.

    • Well Peter have you written to David Shearer and the Caucus Have you made your well worth comments made to Labour’s Policy Council. If not start there because I believe that there is a lot of Labour support for this. If Davis Shearer and the Labour Party and opposition know it has a lot of support then your hopes may be reality.

      • The Chairman 2.5.1

        If the Labour Party is genuinely unaware of the growing public discontent for their lack of commitment to later reverse policy they currently oppose, they must be living on Planet Key.

        All talk in opposition – little action when in power – won’t secure the votes.

      • Peter 2.5.2

        He he. I’ve spent two terms on Labour Party Policy Council (elected), as well as on many policy committees, that feed policy to the Council. From my experience, they were mostly full of people a bit similar to us – good hearted, well-meaning earnest types who cared about NZ and wanted to make a difference.

        However, what tended to happen following any Policy Council process was that Party-written policy would get “lost” on a 9th floor desk. Therefore, the party was an effort-sink skilfully used by MPs to deflect a bunch of energy from activists they would otherwise have to listen to.

        So, like a lot of people at that time, I resigned from all my policy roles, and then resigned from the party, specifically because far too many MPs treated the party with disdain, and still do, from the looks of things (and the good MPs leaving, e.g. Charles Chauvel).

        I know that Jordan Carter and others have made steps to improve the policy processes, and I admire them for doing that, but they still have the same roadblock – the MPs, specifically those from the ABC, or ABP (Anyone But the Party) faction.

        So right now, I view writing to anyone in Labour as a waste of time. It may change, but for now, we must explore other avenues.

        • Skinny 2.5.2.1

          Your quite right Pete r.e. MP’s… I have a friend who is an outstanding Union official, he warned me not to mix with Politicians. I soon got to understand why. He referred to them as a bunch of undemocratic, self interested barstards. Who once elected forgot the hard workers who put them there & put themselves on a pedestal playing lip service to rank & file activists. I Agree with regard to policies going missing on the 6th floor. 
          Note: I am mainly referring to Labour but you can add a couple of arrogant Green MP too namely that little twerp from Gizzy!            

  3. vto 3

    One other thing…

    The people of NZ and the govt of NZ are as entitled to so act as described above in the free market asd much as anyone. It is a free market. It is a free world (ok, within limits). We are free to act and should make no apology for it.

    We are free market participants, with many tools at our disposal, and we should use them.

    Fuck the profiteers.

    btw, can anyone explain how having a profit component in our electricity prices is beneficial?

    • Colonial Viper 3.1

      btw, can anyone explain how having a profit component in our electricity prices is beneficial?

      Well, those profits can be offset by more tax cuts for the wealthy.

      • Draco T Bastard 3.1.1

        That only applies if the assets stay in our possession. This government is going to sell them, lose the dividends and cut taxes making the tax base smaller.

    • Tiresias 3.2

      What you refer to as “a profit component” is actually a use of money charge. Economics 101.

      Let’s say ‘New Zealand’ needs to build a new hydro dam to meet electricity demand. Howya’ gonna do it?

      1. Call for volunteers to fund themselves for three years as they wield pick and shovel in the mud to erect it?
      2. Borrow the money from somewhere? No problem if you offer enough interest to make lenders willing to give you the capital you need. But to pay that interest you have to sell the electricity you make at a ‘profit’ over day-to-day running costs in order to repay the capital borrowed plus the interest (in the form of dividends) you’re having to pay in the meantime.
      3. Print the money you need.

      Of course only Governments can do 3.

      So why does our Government prefer 2 rather than 3? Because some Governments believe as an article of faith that the private sector can run New Zealand’s power supply more efficiently than the Government can. Certainly, Governments have an impressive track record of throwing public money in large amounts at completely dotty projects (diesel from lignite anybody?) usually for reasons that have much more to do with political needs over economics, and option 2 above has the advantage that the risk of such ventures falls on private investors rather than the public purse.

      So there is certainly an argument that having a profit component in our electricity price avoids the often much higher costs of having Governments building the wrong power-stations in the wrong places and run by their kicked-upstairs buddies who usually don’t know the first thing about power reticulation – although such higher costs are usually hidden in subsidies and sleight of hand from the public purse to avoid red faces.

      Personally I think a well-run state-controlled electricity generation industry is by far the best option, but the key there is ‘well-run’ and given the third-rate quality of most of the current political class I doubt a Government of either colour today could run a church bazar very well.

      • Draco T Bastard 3.2.1

        …and option 2 above has the advantage that the risk of such ventures falls on private investors rather than the public purse.

        Did you notice the governments bailing out the banks and financial institutions? Seems to me that, no matter what process is used, the risk falls squarely on the government.

        Personally I think a well-run state-controlled electricity generation industry is by far the best option, but the key there is ‘well-run’ and given the third-rate quality of most of the current political class I doubt a Government of either colour today could run a church bazar very well.

        And did you notice the collapse of the entire global financial system that was brought about by the private companies? Yep, favoritism occurs but I’m sure that you’ll find more of it in the private sphere than you will in government and it’s possible to put in place procedures and openness that will help to prevent it in the public sector. Such openness is anathema in the private sector.

        • Joe 3.2.1.1

          That is partly true governments played a very large part in causing the financial crisis. This was due to people like Bill Clinton and many other countries allowing people to get mortgages that they could never afford. Good regulation such as making people have 20% deposit for a house and making sure banks had to have a certain amount of cash reserves at all times would have gone a long way to minimising the effect of the crisis.

    • Arfamo 3.3

      It’s only beneficial if it’s an SOE, and the (limited) profits get fed into the budget or reinvested in energy infrastructure development or maintenance, isn’t it?

      • Draco T Bastard 3.3.1

        Yep. Basically the SOE would be bringing in a surplus which would be fed back into it’s operations and there would be no dividends and thus no profit. IMO, under such a system major infrastructure would be paid for through taxes rather than through the surplus with the surplus used to fund ongoing R&D and maintenance.

        • Arfamo 3.3.1.1

          I’m learning as much as I can about the history and current operations of power generation and supply here. Max Bradford in a less tolerant and law-abiding society would have been lynched by a screaming mob. I don’t think the general populus realises just how deep in debt we are getting under the Nats, and how ideologically blindly and completely unnecessary it was. Nor how much worse it is likely to get. I can’t see big numbers of new full time well paid jobs on the horizon (from either party) and privatising, even partially, only means more user pays and increasing prices (the higher profit/higher asset revaluation spiral). And probably more indirect taxes. All of which hit low and middle incomes hardest and reduce living standards.

          But I’m equally interested to read the views of those who have any semi-rational explanation of why asset sales are a good thing, for any reason other than they shouldn’t have ever been necessary. I see it as short term gain for long term loss, same as the banks.

          • Colonial Viper 3.3.1.1.1

            I can’t see big numbers of new full time well paid jobs on the horizon (from either party)

            This is the age of environmental and resource depletion.

            Therefore, actual real economic growth (as opposed to ponzi financial bubble schemes) are going to become harder and harder to achieve.

    • Shane 3.4

      “btw, can anyone explain how having a profit component in our electricity prices is beneficial?”

      Perhaps dividend income for the shareholder who took investment risk or reinvestment by the business into productive, income earning assets. Capitalism 101.

      Solid Energy is a case in point why the state should not be an owner/shareholder!

      • Arfamo 3.4.1

        The problem is a privatised business may invest too much in unproductive income eating assets – shareholders and directors – at the expense of maintenance and new generation.

  4. johnm 4

    Here’s the U$K situation. Traitor Key selling off our Power companies is creating the same obscenity here. He’s a market ideological idiot.The artist taxi driver.

    http://www.youtube.com/watch?v=2HRjyf__hJA&list=UUGThM-ZZBba1Zl9rU-XeR-A&index=2

    I forgot: The well orf section of NZ divided society are complicit with playboy Key. Prices will go up for us and big profits for them and the banks who finance them with fiat junction.

    • johnm 4.1

      Here’s the U$K situation. Traitor Key selling off our Power companies is creating the same obscenity here. He’s a market ideological idiot.The artist taxi driver.

      http://www.youtube.com/watch?v=2HRjyf__hJA&list=UUGThM-ZZBba1Zl9rU-XeR-A&index=2

      I forgot: The well orf section of NZ divided society are complicit with playboy Key. Prices will go up for us and big profits for them and the banks who finance them with fiat junk money.

    • Draco T Bastard 4.2

      He’s a market ideological idiot.

      Don’t make that mistake. Key may be ideological but he’s not an idiot. He has a specific goal, that of selling off all of NZs wealth to the worlds richest people, and he is achieving that.

      • tracey 4.2.1

        Agreed. There came with Key, to the NAT leadership, alot of money. Those who give lots of money have expectations to be met.

  5. shorts 5

    Labour the time is now to say something concrete and positive about what you’ll do
    The electorate awaits
    Seize the day – this is the game changer you need and want!

    • johnm 5.1

      Hi Shorts
      +1 However Labour are a bunch of too comfortable cosy cowards, they haven’t the balls to do sweet F all. :-( They’re part of the problem.

      • Colonial Viper 5.1.1

        Must not do or say anything which might upset or irritate the chattering property owning upper middle classes…

        • TighyRighty 5.1.1.1

          I bet you are the meekest little lamb at your remuera pool side soirées. There won’t be a peep of your online machoness.

          • Tim 5.1.1.1.1

            Whereas of course, you’re the suave man of reason and the foreskin of machismo in tighty whiteys. I think there’s a ‘t’ missing in your headline as well (just btew). God I think you’re so suave you could define the new COOL! We all need you so much I’m at a loss as to how we can reward you for your presence in any way that you might consider adequate.
            If I was to indenture my ‘kuds’ with a mission to engage eternal praise, would that suffice?
            (I always thought egoes the sizes of buses would suffice as a comparison in the new millenium, now I realise we’re talking QEII size). And we all know how Toia took a sideswipe

          • geoff 5.1.1.1.2

            Fuck off traitor.

  6. Colonial Viper 6

    Not a bad approach Ben, but I cannot see why the Government will not be able to afford to buy the assets back.

    Let the market know that you are levying a corporate super-profits tax. An extra 10c/dollar on all profits made over $100M pa.

    Then let the market know that those funds will be used to buy back shares in the companies over time.

    Also, that Government directors will sit on the boards of the power companies. And that Board documents will be released into the public arena 12 months after they occur, in order to fulfill the public good.

    A bit of imagination and what seems impossible will suddenly become very possible.

    • Lanthanide 6.1

      “Let the market know that you are levying a corporate super-profits tax. An extra 10c/dollar on all profits made over $100M pa.”

      Yeah, ’cause there’s no way anyone could evade that tax :roll:

      • Colonial Viper 6.1.1

        Lanth, of course, but then those commercial organisations become criminal organisations, and that is managed entirely differently.

        Notice how the big banks were forced to pay out to the IRD hundreds of millions in taxes they thought they were cleverly evading?

        Have a little bit more faith that loopholes can be closed and regs enforced.

    • Addison 6.2

      So that would mean goodbye to RTZ and jobs in the south. Most other big employers are not going to invest in NZ of they are going to get a worse return investing in NZ than they would sticking it in a Swiss bank.

      • Colonial Viper 6.2.1

        More economic threats and blackmail against NZ?

        You might have noticed that “big employers” are terminating hundreds of jobs a month in NZ as it is. So it’s time to change the game, not do more of the same.

        Time to put a crimp in the wealth pump going out of NZ.

        get a worse return investing in NZ than they would sticking it in a Swiss bank.

        lol mate

    • Murray Olsen 6.3

      The government could always just regulate a maximum price for power and make the companies operate within that. As private business is so efficient, about 50% of what they charge now should be more than sufficient.
      BTW, we just paid our latest electricity bill in Brisbane. $A88 for 4 weeks. Note we pay our landlord each 4 weeks rather than paying the power company every 3 months. We could probably get a 10% discount if we dealt with one of the electricity retailers directly. Max Bradford should be on trial for treason.

  7. millsy 7

    “Max Bradford’s late-90s electricity reforms (to create the “market”) were what outraged David Parker so much that he got into politics, ”

    Then when he become Energy Minister he did nothing to reverse them.

    • Peter 7.1

      None of them did really, not even Pete Hodgson (who I have a high respect for). Labour was just too damned afraid.

      But afraid of what – power is a bit of a mind trick, it exists where you think it exists. So for Labour, it lurks in private sector boardrooms, but for the private sector people, the power lurks in the minds of left-wing thinkers, and so it goes on.

      If Labour realised this, it can stop being afraid, and actually start leading again.

    • Shane 7.2

      The market was actually created under Doug Kidd in 1996. Max Bradford’s reforms included retail competition – ability to switch suppliers, the breakup of ECNZ and the anti-business separation of network lines companies and energy retailers.

  8. Melb 8

    “I’m dubious that any competition truly works in something so infrastructure dependent as electricity (we don’t want 2 sets of cables everywhere…).”

    Why would this happen? They aren’t selling Transpower.

    • Peter 8.1

      Competition in natural monopolies, like electricity, doesn’t work. Yeah, you can simulate competition, which is what we do currently with the electricity market, but that mostly involves adding complexity and costs, and calling it competition.

      All to meet the needs of the dominant ideology of the day – the idea that competition in all fields of human endeavour is somehow healthy and benefits society as a whole.

      The NZED, for all its faults, was able to deliver long term, relatively stable power prices, with a pretty small team of policy staff. Now we have hundreds of ticket clippers at the SOEs and other private generators doing the same thing.

      And guess who pays :)

  9. Matthew 9

    I agree wholeheartedly with this post. One problem i can see to this approach is the TPPA. If we sign this very dangerous agreement, any decision by future governments to buy-back or nationalize the power companies will see us the target of lawsuits.
    Thus we also need to kill the TPPA.
    New Zealand is on the verge of foreign control & most NZ’ers dont know it.

    • Wayne 9.1

      But Labour supports TPP, and if it was Govt at the relevant time would seek National votes to get it through Parliament.

      Of course the Greens and NZ First oppose TPP but on this issue they don’t count. And I do not beleive the Greens would try and pull down a Govt they were part of, on this issue. That would be over reaching, and Russell Norman would know that, even if their supporters don’t.

      More significantly if TPP is successfully negotiated between the 10 countries involved, it is inconceivable that New Zealand would not ratify it. It would be the equivalent of NZ opting out of the Asia Pacific.

      President Obama has made TPP a priority, and on this issue the Congress (Democrat and Repubilican) are generally supportive, so my sense is that TPP will be sucessfully negotiated sometime late this year or in 2014.

      • Matthew 9.1.1

        All good points, none of which address the issue that the TPPA will destroy NZ. I asked Shearer about the TPPA when i met him in Napier, & his answer did not give me any confidence. I cannot see why they, anyone, thinks it is good for NZ.

      • Bunji 9.1.2

        I think “Labour supports TPP” is far too bald a comment. While seeing that Free Trade Agreements can be a positive, they’ve expressed concerns about TPP – specifically over the secrecy of it, Pharmac and copyright issues (and possibly one or 2 others).

        And “if TPP is successfully negotiated between the 10 countries involved, it is inconceivable that New Zealand would not ratify it”? Surely the measure shouldn’t be how many other countries ratify but whether it will have a net positive effect for the NZ economy? That should be both Labour and National’s position. Australia have done the analysis on their FTA with the US and found that they are 1% worse off because of it – one has to be very careful about deals involving the US. They want to grab all the benefits of free trade to their side – and then some if they can get away with it.

        TPP will have huge issues with Congress btw – particularly with any deal that will be beneficial to NZ. If there’s one thing that unites Democrats and Republicans it’s self-interest nad protecting their constituencies. And virtually every state in the US has dairy cows…

        • Wayne 9.1.2.1

          TPP won’t have huge problems with Congress (in my view).

          Each of the 10 countries have their specific objectives. They wont all be realised, but each country is going to get something of value.

          NZ will get better dairy access to the US, but the total extent and the timeframe will be in hot contention in the negotiations. The US will get something on IP. Everyone may see some advantage in investor protection – each country is both a recipient of investment and an offshore investor.

          BTW, whats your source that Aus is 1% worse off due to the FTA with the US. I know that they think it has not been as good as hoped, but actually being worse off than they otherwise would be- who says that?

          • Colonial Viper 9.1.2.1.1

            NZ will get better dairy access to the US

            This is bullshit

            We don’t need this access

            We get penalised and our sovereignty eroded

            All for extra sales of butter we cannot even produce.

          • Bunji 9.1.2.1.2

            Dang my lack of memory for sources… I remember there being a news story on the study 2 or 3 years ago. I think the 1% was how much ordinary Australians were worse off (after increased costs, without increased benefits), but I could be wrong.

            Certainly the IMF said at the time Australia would be 0.03% worse off each year, and indeed imports from the US have boomed while exports initially declined and haven’t shown much zest since – the bilateral trade deficit has boomed instead.

            As well as the small export growth they’ve suffered significant trade diversion to other markets, and “the exclusion of sugar from the deal has cost taxpayers over $400 million in compensation, changes to the Pharmaceutical benefits scheme could cost $1.5billion a year, increased costs to farmers as quarantine laws are relaxed, and increased costs to all consumers with the extension of copyright protections for books, music, films, art, and computer software by 20 years. “

  10. Anne 10

    An announcement will render the assets unsellable.

    In the context of your first sentence Ben, do you mean that if Labour announced in unequivocal terms how they plan to start the reverse process re-the asset sales programme, then they would render the assets unsellable?

    Forgive me my naivety on this subject, but isn’t that exactly what we want to see happen?

    • Ben Clark 10.1

      In my first para I was outlining a popular theory among standardistas. Me, I’m not so optimistic: I think National would sell anyway, and just get a worse return. They’re not concerned about selling at the bottom of the market, so why would any further depression of the price stop them…

      • Anne 10.1.1

        I think I see what you mean now. Thanks for the explanation and I agree… their blind ideology means they would sell on principle whatever happened. Why doesn’t Labour/Greens toss them into the cactus anyway and watch then wriggle out scratched and bruised. Whatever happens NZ is going to be the loser now. The only difference would be the timing.

        • One Tāne Huna 10.1.1.1

          Is it blind ideology, or just the desire to get the dividends flowing into the seeing-eye trusts sooner rather than later?

          If, for example, their internal polling were telling them that time is running out that would also explain it.

          • Draco T Bastard 10.1.1.1.1

            The people like the mainstream economists it’s blind ideology but for people like Key it’s got more to do with becoming even bigger parasites on the rest of us.

  11. Draco T Bastard 11

    Take them back and we lose the confidence of the international community.

    Very few people in NZ will care. Specifically, only the RWNJs, the politicians and the CEOs will care. Everyone one else is aware of how much damage caring about what the “international community”, really just the politicians and business folk of other countries, has done to this country.

    And we can regulate these companies within an inch of their lives.

    Actually, we’d have to regulate them until they collapse and the cost of the regulation will far outweigh any benefits that the sale produces.

    And a personal hobby-horse – even make sure that a good rate is paid to private households contributing energy to the grid.

    The amount paid to private households must be the same that the household is charged. Any less and the household is, effectively, paying the electricity company to use the power that the household generates. The line charge is already separate from the electricity charge.

    A distributed power-supply will be more efficient.

    Yep, especially once we get a fully smart grid in place which is another reason why electric grid is a natural monopoly.

    Let’s hear a plan to move towards it.

    A plan to move back to an efficient state monopoly would be good.

    • Lanthanide 11.1

      “Very few people in NZ will care. ”

      Yeah, actually, I work for a company that exports goods internationally, so I very much care, because I could be out of a job if things went disastrously tits-up.

      • geoff 11.1.1

        Explain how NZ renationalising its electricity system would cause you to lose your job.

        • Lanthanide 11.1.1.1

          Draco was quoting this statement in the original post:

          “Take them back and we lose the confidence of the international community.”

          I replied to Draco’s statement.

          My point is that if we “lost the confidence of the international community” I could potentially lose my job, “if things went disastrously tits-up”.

          • Colonial Viper 11.1.1.1.1

            the confidence of the international banking cartel

            I believe this is what you meant.

            The “international community” in general will be fine with us. The people who will be pissed off will be the big banks and hedge funds.

            The main danger to NZ is an international capital strike.

            Notice how they bitch about workers having the ability to strike, but will quite freely conduct a capital strike if it suits their needs.

            • Rogue Trooper 11.1.1.1.1.1

              strike a match

            • Tiresias 11.1.1.1.1.2

              Here’s your problem:

              New Zealand’s gross external debt: $256.4 billion (125.3% of GDP). Of that private debt amounts to 83.5% of GDP. Most of that will be money borrowed by business to stay in business.

              What is currently killing Spain and Greece is the cost of borrowing – which they either have to do to refinance when loans fall due, pay out of taxes to clear, or default.

              Currently the cost of borrowing abroad for New Zealand and New Zealanders is nothing like what it is costing Greece et al, but if you’re going to start seizing/confisticating property as some on this site are advocating the risk element in New Zealand’s borrowing costs will skyrocket which means either than even more GDP will flow off-shore as interest, businesses will go bankrupt or be sold off-shore and even more of our taxes will go in funding the national debt.

              Or of course we could stick our fingers up at foreign lenders, and be like the Greeks where the pharmacies are running out of medicines as there is no money for them.

              • geoff

                Yeah a small problem with your analysis is that neither Spain nor Greece have control of their currency. We can.

                • Tiresias

                  Yeah, thought someone might say that.

                  Look at those figures again. Two-thirds of New Zealand’s overseas debt is private debt. You suggesting we roll our printing presses to pay off private debt with public money?

                  ‘Course that what the US Federal Reserve and the Bank of England did in 2008 to pay off the debts of the banks.

                  • geoff

                    You suggesting we roll our printing presses to pay off private debt with public money?

                    We may have to, it entirely depends on how the mexican standoff in the global financial system play out over the next few years. The banksters don’t look like they’re going to change their ZIRP policies anytime soon and many commentators are suggesting that this cannot go on forever. They argue that a continuation of this policy will result in the return of a gold standard. There is evidence to suggest that many central banks around the world are repatriating their gold reserves, ie shifting the physical gold from being on loan to other central banks back to their own vaults. I wonder how NZ would fare if such an upheaval were to occur
                    given that, from my understanding, NZ’s gold reserves are nix, nada, nothing 0.

                    • Colonial Viper

                      Basically, yeah.

                      And forget gold – this nation has something far more valuable: productive farm land.

                  • Draco T Bastard

                    Look at those figures again. Two-thirds of New Zealand’s overseas debt is private debt. You suggesting we roll our printing presses to pay off private debt with public money?

                    Not More of the Same

              • Draco T Bastard

                …which means either than even more GDP will flow off-shore as interest, businesses will go bankrupt or be sold off-shore and even more of our taxes will go in funding the national debt.

                Nope, just have the government make loans available at 0% interest. The government getting the money from the simple act of creating it at 0% interest. Businesses stay in business, the NZ$ drops on the forex boosting exports and the large dollop of interest on every single purchase disappears.

                • Tiresias

                  “Nope, just have the government make loans available at 0% interest.” – Draco.

                  So you’d have the public purse take the risk of every business in the country? And the risk of every expansion plan they’d rush into with funding at 0%? And the huge salaries CEO’s would pay themselves when it costs the company nothing?

                  And of course with businesses borrow about $40 billion from the Govt. at 0% they can repay $40 billion owed to ANZ, BNZ, Westpac, ASB et al.

                  So ANZ, BNZ, Westpac, ASB et al find themselves with $40 billion cash in their vaults to get rid of. “Hey, you breathing? Want a $1 million mortage at 2% to buy your dream property?”

                  Or they’d use it to buy US Treasury Stock at a nice safe, profitable 0.5% and drive the NZ$ down to US$0.50 putting petrol in NZ up to $5/litre?

                  • Draco T Bastard

                    So you’d have the public purse take the risk of every business in the country?

                    SCF ring a bell?

                    And the risk of every expansion plan they’d rush into with funding at 0%? And the huge salaries CEO’s would pay themselves when it costs the company nothing?

                    So ANZ, BNZ, Westpac, ASB et al find themselves with $40 billion cash in their vaults to get rid of. “Hey, you breathing? Want a $1 million mortage at 2% to buy your dream property?”

                    Loans tend to have conditions such as the company/individual being able to afford to repay them.

                    Or they’d use it to buy US Treasury Stock at a nice safe, profitable 0.5% and drive the NZ$ down to US$0.50 putting petrol in NZ up to $5/litre?

                    First, I really couldn’t care less if the price of fuel hit $5/litre. In fact, I figure that’s going to happen before the end of this decade anyway (in real terms). Secondly, a condition of the loan would be that they can’t do that and if they do we take it all back plus fines and the interest earned.

                  • Colonial Viper

                    So you’d have the public purse take the risk of every business in the country? And the risk of every expansion plan they’d rush into with funding at 0%?

                    Wait. There would be checks and balances that would apply, as well as infrastructure and advice, that new businesses could take advantage of.

                    Further, anyone grossly misusing funds would be done for fraud and put away.

                    It would give a chance for small businesses to start up, and for medium sized businesses to expand their market reach.

              • Murray Olsen

                Why is it ok for a right wing government to seize our property and sell it to their mates, but not for a left government to seize it back? The whole dialogue is hopelessly skewed.

                • Colonial Viper

                  I read Tiresias comments in more detail.

                  Basically Tiresias doesn’t understand that most of NZ’s private debt was due to a mortgage fuelled property bubble (residential and farming). Instead, Tiresias assumes that the debt is being used productively to keep businesses and employment going, which is largely untrue.

                  Secondly Tiresias tries the old scare tactic. Pharmacies don’t have medicines etc. because they have no more hard currency.

                  Notice how Greece still has money to buy hundreds of millions of Euros worth of military hardware, but no money for medicines? So what Tiresias has completely missed here is that the Economic Hijacking of whole countries is deliberate, engineered and prioritised.

                  http://www.presseurop.eu/en/content/article/1383501-greece-still-splashes-out-billions-defence

      • Draco T Bastard 11.1.2

        So you’d be fine with NZ being continually screwed over if you get to keep your job?

        • Lanthanide 11.1.2.1

          No, I’m just disputing your point that “very few people would care”, because actually a lot of people would care.

          I stopped reading your comment at that point because you got off to such a bad start it didn’t seem like it would get any better. I see now that your last missive is suggesting everything should be run by the state, communist-style, so I was right.

      • Crashcart 11.1.3

        As opposed to those fantastic export conditions your company is currently operating in?

        • Colonial Viper 11.1.3.1

          don’t rock the lifeboat, we’ll be OK

          Now I know why hundreds of people were allowed to drown right beside the half empty lifeboats off the Titanic.

        • Lanthanide 11.1.3.2

          While a lower dollar would effectively keep our costs down, as our salaries are ultimately paid from $US, very little has changed for us over the last 7 years I’ve been working here. If anything we’re now in a growth phase.

    • Wayne 11.2

      Try and stand for Parliament with these views

      • Colonial Viper 11.2.1

        Comfortable relatively well-off (for now) middle class voters wouldn’t have a bar of it

  12. bad12 12

    My view, kick start the ‘Cullen Super fund’ and have the Minister direct that fund to purchase shares in all the sold off assets, this could be achieved in part by a sell down of the lesser performing tranches of shares in foreign share-markets,

    Legislate 20% of all Government surpluses be moved into the ‘Cullen super fund’…

    • alwyn 12.1

      There appears to be some confusion in this approach as to what the Cullen Fund is.
      The fund was NOT set up to be a Sovereign Wealth Fund, with assets basically being held in perpetuity.
      It was intended that it be built up prior to about 2031 and then the assets in the fund would be drawn down to help pay for National Superannuation after that date.
      This will require that the fund sells the assets it has accumulated in order to fund the drawdown.
      If this is what you mean to continue then you must be willing to sell all the interest in the SOEs, albeit at a later date. Is this what you mean?
      If you do not intend to realise the assets it is no longer the “Cullen Fund”. Is that what you mean, that these funds will never be available to fund the future superannuation needs?
      In either case, of course, you are requiring that we borrow more than we would otherwise do if we sell 49% of each of the SOEs.

      • bad12 12.1.1

        The Cullen fund would simply be the utility for holding the shares, as the Cullen fund wont need be drawn upon all at once,i assume, then Government can repurchase these shares from the Cullen Fund as the need to sell them becomes apparent…

  13. Jackal 13

    Why is it highly unlikely that there won’t be any money to repurchase those assets back Ben Clark? With the collapse of Solid Energy and an ailing market, the sale of the assets isn’t looking likely to make the government any money at all, even in the short term. Then there’s the fact of large claims to be settled on water rights.

    National has increased government debt by around 200% since 2008 and our debt to GDP ratio means it will be difficult to even service the interest on that debt they have inflicted on us to build some roads of little significance. Couple that with an extended drought period and falling export incomes because of the high dollar, both of which will have a severe impact on our economy, and it’s not hard to see that New Zealand is up shits creak without a paddle.

    In the face of such reality, blathering on about the next Labour led government simply buying back our assets is simply ludicrous! By arguing that the government should spend billions more taxpayer dollars on repurchasing our assets and fighting the litigation that will undoubtedly occur, you’re basically arguing that the government should make further cuts in other areas or borrow more than we can ever hope to repay.

    What other cuts can be made Ben Clark? Perhaps the next Labour led government could kick more people off the dole and DPB or fail to ensure there are enough houses to accommodate our growing population. Is that the New Zealand you envision, thousands more people living rough and doing whatever it takes to survive? At least there will be lots of jails available though, so I guess repurchasing those assets to the detriment of society at large could be an option… But only if you have no social conscience at all.

    • Ben Clark 13.1

      Sorry Jackal, your comment just really confuses me.

      You ask why I say that it’s highly likely that there won’t be any money left to buy back the assets, and then outline it for me. And then you say by my proposal to buy back assets I’ll be consigning people to huge social cuts… when my proposal was about how to cope with not being able to buy back the assets… (or at least not immediately)

      Perhaps you need to read my post again?

      (And I can’t work out why there would be lots of jails available?)

      • fenderviper 13.1.1

        It’s very sad that Jackal has caught mumblefuck virus, hope it can be treated.

        • Colonial Viper 13.1.1.1

          It’s not looking encouraging thus far.

          • Jackal 13.1.1.1.1

            My word, fenderviper and Colonial Viper have turned into a couple of morons without any argument apart from ad hominem bullshit!

      • Jackal 13.1.2

        National is building more jail cells than is required… I notice that you’ve changed the unlikely to likely… I’m glad you agree with my argument then Ben Clark.

    • Rogue Trooper 13.2

      “is that a canoe in your pocket or just pleased to see…”

  14. DH 14

    Regulation won’t work because it can’t address the underlying problem, one of which is not enough Labour MPs appear to have sufficient knowledge of accounting and business.

    You start with the platform, which is that a business must provide shareholders with a reasonable market return on capital (or equity which is used more these days).

    Modern accounting practice permits a business to revalue it’s assets annually to reflect ‘fair market value’. Most of the dams for example are in the books today at values higher what they originally cost to build.

    There are two basic ways of valuing an asset – it’s replacement cost less depreciation and it’s earning capacity. Most big assets are valued largely by their earnings, usually as a multiple of the existing return based on prevailing market rates.

    Now, if an asset is revalued upwards then it increases the capital or equity of the business. That then creates pressure to increase the returns the business is making because the minute the asset increases in value the existing return will fall as a percentage of equity. With electricity increasing the return is as simple as putting the price of power up.

    When prices go up the returns go up. When returns go up the value of the asset goes up, because it’s valued by the return it makes. When the value goes up the return falls as a percentage of asset value, so up go the prices again. It’s a one-way ratchet and clearly price regulation can’t stop that because it’s not addressing the flawed acounting practices that have been causing this problem.

    FWIW Solid energy are in trouble largely because they value their coal & associated assets on their earning potential. When the price of coal fell the value of the coal in the ground also fell which will lead them to post another large loss on the books due to writing down the value of assets. Power companies of course don’t really have that problem, the price of electricity isn’t likely to fall.

    • Draco T Bastard 14.1

      It’s a one-way ratchet and clearly price regulation can’t stop that because it’s not addressing the flawed acounting practices that have been causing this problem.

      Well, it can because it’s regulation that’s allowing that flawed accounting problem.

      • DH 14.1.1

        Well actually it’s not anything because they haven’t said exactly how they’d regulate. But the comments from Labour up until now have been directed largely at the pushing the Commerce Commission to use their powers to regulate monopoly behaviour more. That might trim the spikes but it wouldn’t curtail the inexorable increases in the price of power.

        They could of course try putting physical price controls on power but how would they do that? Muldoon tried a wage & price freeeze back in the ’80s and it didn’t work, what makes anyone think it would work today? They’d also be subjecting the Govt to lawsuits under the WTO by Contact and Trustpower, Vector etc for breach of contract & loss of earnings.

        • Colonial Viper 14.1.1.1

          They’d also be subjecting the Govt to lawsuits under the WTO by Contact and Trustpower, Vector etc for breach of contract & loss of earnings.</blockquote

          Change the law so they couldn't.

    • Colonial Viper 14.2

      You start with the platform, which is that a business must provide shareholders with a reasonable market return on capital (or equity which is used more these days).

      Nah sorry exponential growth on a finite planet doesn’t work any more.

  15. Addison 15

    Just a thought what if Labour say they will Nationalise, drive the price down and don’t get elected. Just think of the huge profits that would be made by buyers then. Even died in the wool Labour supporters don’t talk of a Labour Government but of a Labour Green government. The POlls ,like them or not, show Key and National doing well. It’s a scenario that is more than possible, so your plan could drastically backfire. Also how will you stop people buying low and making a quick buck before the election.

    • Draco T Bastard 15.1

      It’s called taking a risk, something that people need to do every now and then especially if they want to get the sociopathic capitalists off their neck.

  16. burt 16

    Labour – Prepared to bankrupt NZ again just to be popular enough to get the Treasure benches… It’s 1999/2002/2005 all over again. Go for it – waste billions of tax payers dollars so Shearer has a turn at feeling special…..

    • One Tāne Huna 16.1

      It’s time for your reality check. Does the word “surplus” mean anything to you? Does it mean anything to the parrot currently in possession of your “mind”?

    • Draco T Bastard 16.2

      You may not have noticed burt but it’s this government that’s bankrupting the country.

      • Colonial Viper 16.2.1

        English writing out IOUs at the rate of $200M – $300M per week in fact.

        Hey burt – waddya think about your heroes management of the NZ economy 5 years in eh?

  17. 27 February 2013

    MEDIA ADVISORY: : Switch Off Mercury Energy community group:

    PROTEST THURSDAY 28 FEBRUARY 2013

    The Auckland Switch Off Mercury Energy Group has organised the following:
    PROTEST!

    WHEN: Thursday 28 February 2013, from 3.30 – 5.30pm

    WHERE: Outside Mighty River Power corporate office

    ANZ building, 23 – 29 Albert St, Auckland City

    MAP: https://maps.google.co.nz/maps?hl=en&ie=UTF-8&q=mighty+river+power+auckland&fb=1&gl=nz&hq=mighty+river+power&hnear=0x6d0d47fb5a9ce6fb%3A0x500ef6143a29917%2CAuckland&cid=0%2C0%2C14661661492653781907&ei=Iu-EUM-0La6higfJyoG4Dg&ved=0CGYQ_BIwAQ

    _____________________________________________________________________________

    “The legal challenge is over – now it’s PEOPLE POWER TIME to stop the sell-off of Mighty River Power!” says a Spokesperson for the Switch Off Mercury Energy group, Penny Bright.

    “It is time for the public and all political parties opposed to asset sales to hold this minority National Government’s ‘feet to the fire’. Remember this?

    “Let me make it quite clear. If the Government doesn’t get a good price – the Government isn’t going to sell”

    (Tony Ryall, Minister of SOE’s 17/6/2012 NBR

    http://www.nbr.co.nz/article/govt-wont-sell-assets-if-it-cant-get-good-price-ryall-ck-121435 )

    “How can the Government get a ‘good price’ for Mighty River Power – if it’s losing thousands of customers and it’s profits are dropping?”

    [PRECEDENT: In 2008, Contact Energy (already privatized) doubled their directors fees and raised their prices 12%.In 6 months, more than 40,000 customers switched from Contact Energy and their profits were halved.
    http://www.nzherald.co.nz/droughts/news/article.cfm?c_id=180&objectid=10590906&pnum=0 ]

    “It’s now time for thousands more New Zealand Mums and Dads, aunties, uncles, brothers, sisters, and grandparents (particularly those struggling to pay power bills for companies we already own) to ‘seize the moment’ and take action which cannot be ignored!

    It’s time to Switch Off Mercury Energy – 100% owned by Mighty River Power!

    The companies to whom we recommend switching are the following publicly owned companies:
    Genesis Energy http://www.genesisenergy.co.nz Ph 0800 300 400
    Meridian Energy http://www.meridianenergy.co.nz Ph 0800 496 496
    Powershop http://www.powershop.co.nz Ph 0800 1000 60
    Energy Online http://www.energyonline.co.nz Ph 0800 086 400 ”

    Penny Bright

    A Spokesperson for the Switch Off Mercury Energy community group.

    http://www.facebook.com/SwitchOffMercuryEnergy/info

    Ph (09) 8469 825
    021 211 4 127

    • Shane 17.1

      Fantastic Penny, retail competition – consumer choice and voting with your feet. Power to the Consumer. Exactly what Max Bradford’s reforms envisaged!

    • Joe 17.2

      One huge problem with your idea customers leaving for Genesis and Meridian will just make those companies look even better when it comes to sale time. Powershop and Energy online are small players so it won’t make much difference.

  18. NoseViper (The Nose knows) 18

    On why our electricity prices are going up while the cost of electricity generation is going down – Molly Melhuish on tv explains.
    http://tvnz.co.nz/breakfast-news/power-prices-rise-despite-wholesale-price-drop-video-5354707

    I searched on Radionz under electricity and got a couple of summaries:
    ‘Minister says best way to lower power bills is to use less”
    and
    The price of electricity is tipped to stay higher than inflation for the next 18 years, prompting concern that consumers will continue to struggle to pay their bills.
    From Morning Report on 30 Jan 2012 (5′50″)
    Download: Ogg Vorbis MP3 | Embed
    Gas prices to double within a decade and then double again

  19. NoseViper (The Nose knows) 19

    Still can’t edit – nothing in window.
    Radionz summaries can be found if search for Molly Melhuish.

  20. Rogue Trooper 20

    The (real) Regulators
    http://en.wikipedia.org/wiki/Lincoln_County_Regulators
    Duelin’ Daltons
    http://en.wikipedia.org/wiki/Dalton_Gang
    a real bunch o’ Cowboys would feel right at home here
    do do Doolin, lookin out our backdoor at a Wild Bunch of Desperados
    http://en.wikipedia.org/wiki/Bill_Doolin

  21. MrSmith 21

    If we force shareholders to sell their shares back to the Government I suspect the Government would find itself in court and lose. Regulation is fine till the Government changes and then deregulates.

    This is the perfect crime, Labour can’t appose it because National will blame them when they don’t get a good price for the assets, and shit we don’t need this money it’s a drop in the ocean compared to the 140 Billion Blinglish has borrowed so far, we could regulate with some kind of super majority clause but we would need super majority support for such regulation.

    Regulation is really the only option for later, but you would be cutting off your nose to spite your face by undermining the sale process, because National will sell these assets anyway along with your future and your mother for a few dollars, that’s what you get when you put a slimy, two faced, money trader, who moonlights as a second rate comedian in-charge of your country.

    • Draco T Bastard 21.1

      …we could regulate with some kind of super majority clause but we would need super majority support for such regulation.

      That’s what referendums are for. They tend to stop the government doing what the rich parasites want and forces them to do what the people as a whole want.

      • TheContrarian 21.1.1

        Only if binding

        • Draco T Bastard 21.1.1.1

          Well, yes, but referendums initiated by the government are binding. It’s only citizen initiated referendums that are non-binding.

          And that’s ATM as well, need some rule changes to make sure that the government initiates the referendum and/or make citizen initiated referendums binding.

          • TheContrarian 21.1.1.1.1

            “make citizen initiated referendums binding.”

            As has been pointed out here before, making CIR binding would not be a good idea at all.

            • Draco T Bastard 21.1.1.1.1.1

              I disagree with that. Of course, there would need to be changes to the rules as to how the referendum was worded as well as better access to information. The Family First referendum at the time of the s59 repeal is proof of that.

              • McFlock

                maybe with some heavy restrictions on election campaign funding and polling to go alongside efforts to prevent cruelty to the English language.

              • TheContrarian

                A CIR referendum about law and order put to the public after a particularly grisly murder could see the reintroduction of the death penalty based upon knee-jerk reactions.

                I don’t think you have thought this through

      • MrSmith 21.1.2

        Yes Draco some kind of policy where government assets could only be sold after a referendum would be fine, but really the whole fucked up system needs to be rebuilt from the bottom up as you know.

        National are driving us down a dead end street for short term profit, but hey we aren’t going to live forever, and as Cherry-Gerrard said in The worse journey in the world ‘What’s is the use?’ For we are a nation of shopkeepers, and no shopkeeper will look at Research which does not promise him a financial return within a year.” Death by a thousand cuts under National.

  22. George D 22

    I won’t ask if it’s likely.

    Do you think it’s even possible that a Labour-led Government would do this?

    • Joe 22.1

      Oh its possible, they have done it before and they will do it again. One of the reasons I think they are anti-asset sales is that in reality they wanted sell the assets when they next get into power. If you think Labour will never sell government assets you are dreaming.

  23. outofbed 23

    So people choose between eating and keeping warm.. Meanwhile..http://www.guardian.co.uk/business/2013/feb/27/centrica-british-gas-increase-profit. Coming soon to a town near you

  24. Dean Reynolds 24

    To hell with regulation – we take back our power companies – issue 10 year Govt stock to the private owners at the same value they bought the companies for. When the stock matures in 10 years, they get paid out – gives us time to find the money to buy them out. We don’t leave strategic assets in private, foreign hands, FFS!

  25. swan 25

    Sounds like a recipe for for power shortages to me. No profit = no investment in new capacity.

    • Arfamo 25.1

      If they are working for private shareholders, how much profit do you think would be invested in new capacity anyway?

      • Draco T Bastard 25.1.1

        Telecom has already shown us that answer – as little as physically possible resulting in the government having to step in in a decade or so to upgrade the network bringing about even more profit for the private sector.

    • Colonial Viper 25.2

      Sounds like a recipe for for power shortages to me. No profit = no investment in new capacity.

      Funny, Clyde, Manapouri, Roxburgh and Huntly were all built during a time of zero private sector electricity profit.

      Figure it out swan, you’re a smart lad.

  26. Addison 26

    But were they not built with the aim to make a profit? I don’t think many business would invest millions with the aim to hand any profit over to the government!

    • Colonial Viper 26.1

      So, private sector corporations can stay out of it then.

    • Draco T Bastard 26.2

      But were they not built with the aim to make a profit?

      No, they weren’t. They were built pretty much as government services.

  27. Addison 27

    So under a socialist plan the power companies won’t make a profit. Ok now wasn’t the objection to selling them that it didn’t make sense because of all the lovely profit they make! Come on boys, get your story straigh, your going to have to sell it to voters soon.

    • McFlock 27.1

      so do you need drugs to blur the ideal world with current reality, or does it come natural? Along with treating all the commenters here as indistinguishable followers of a single political party, of course.

    • Draco T Bastard 27.2

      Under current conditions giving up the profit is a mistake. Changing the conditions so that electricity is run as a government service rather than a profit making exercise and the profit is no longer needed.

  28. Addison 28

    Reality! The majority of people support parties to the right of center. The further left you go the less support. Why do you think Labour makes 30% , the greens 12% and manna, the Workers party 1%. reality .

  29. Addison 29

    CV I am sure the next election like the lastntwo, will prove one of us right.

  30. Addison 30

    Reality is that most work hard ,use their initiative to better their lot. Reality is not expecting any government regardless of r or l to do that for you.

    • Colonial Viper 30.1

      Individualism cannot overcome or compensate for the flaws of a failing economic system and a government determined to act for the rich.

    • Draco T Bastard 30.2

      The reality is that we could keep our standard of living that we have now on 10 hours work per week each. The only reason why we work harder and longer is that a few sociopaths want more and more and more.

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    3 days ago
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