It follows the implicit contract that workers should pay for their elders – but adds the codecil (?sp) that it should not fall much heavier on the workers than it fell on their parents.

Kiwisaver is probably more important longer term. One of the issues with national super is that the expectations of the superanuiatants (?sp) is also increasing (like they expect to have internet access). Since workers should not expect more than they contributed to their elders, then they need to start saving for it.

So Kiwisaver is a way of making sure that most of the working population starts paying for their expectation of the retired standard of living, rather than passing the burden onto their working children.

People can (and should) also run other investments as well. But we’re heading to a tiered retirement system. The ‘state’ makes sure that the minimum super system operates as a baseline. If you work, then it makes it easier to save (kiwisaver). If you want more, then save/invest yourself.

Putting in one size fits all package (aka NZF’s ideas) in the current super environment is probably impossible. It would require some generations to double pay. This tiered approach is probably the most effective way to make sure that you don’t leave non-workers (eg ‘homemakers’) living on nothing in their old age after their divorce.

When it comes to gaining in the polls political parties are complete popularity sluts. They will do and say whatever it takes. However the bottom line is that the public that voted a govt in to do that are the stupid ones, they got what they deserved.

Politicians almost have to be, after all you have to have the treasury benches to be able to do much to influence policies. What convinced me to move to the left was the nature of the right’s politicians. They seem to prefer being irresponsible and outright decitful because they know that spelling the implications of some of their policies will ensure that they are not elected. The left tend to be more honest.

The information role is meant to be filled by the 4th estate, but they seem to have been overcome with the passion for sales generating headlines. In TV that is almost the nature of the medium. Radio (with the exception usually of RadioNZ’s national programme is either music or bigotry by people who are under employed.

There is often some interesting material in the print articles. But that is seldom shown in the headlines or first few paragraphs. Facts don’t help sales.

That is why I helped to set this site up, regardless of the partisan nature, it helps provide a channel for debate. There is starting to get to be a substantial readership because it is a place to get an outline of a discussion with drill downs for more. The comments allow the posts themselves to be analyzed.

We exist to be critical of other peoples policies and shortfalls. Both the media and politicians love us (yeah right), and seem to be amongst our most avid readers (well at least their staff are).

I completely share the same perspective that Muldoon scrapping the super fund was short sighted. I remember the time, it was very very different to today but there was one constant. When it comes to gaining in the polls political parties are complete popularity sluts. They will do and say whatever it takes. However the bottom line is that the public that voted a govt in to do that are the stupid ones, they got what they deserved.

Problem is voters have short memories and partisan tendencies ensure we only notice when the opposition behave this way.

The problem with the Cullen fund mentality is that is is fundamentally unfair despite it being socialistically adorable. There is no recognition of input in the output. How can that be fair. I have no argument with a minimum standard but no recognition for the weight you have carried for others to have the minimum? It’s simply not just.

KiwiSaver provides an incentive to rely less on GRI for your survival but it in no way addresses the fundermental inequities of the Cullen fund as a concept. Winston Peters with his referendum on superannuation was half way there. The scheme was basically sound except for the fact it required you to take an annuity from the fund on reaching retirement age. The intent of such a rule is clear but it’s against the grain to be told how you must collect your savings.

The inherent problem is that having a system like national super is that it depends on the birth/immigration rate remaining reasonably constant. It hasn’t – as was obvious in the 1970′s. If you are going to have a system like national super (and it is almost impossible to change now), then it should be paid for by something like the Cullen fund up front – not transferred as a burden to future taxpayers.

As far as I’m concerned the current generations should get tax cuts AFTER they have fully funded the super shortfalls.

I’ll also bet all the money (as debt) in my pockets against all the money (as debt) in your pockets

Here you go Phil, some interesting reading by the Reserve Bank of Chicago about how money is created. I should also throw in the new Zietgiest: Addendum movie – it’s much better than the first one.

The purchase of the railways (at about $700m, not $1b as you state), was a one off purchase.

This is completely different to a tax cut that will reduce govt income in the order of $8b each year and every year into the future. Given that the deficits are ALREADY projected to be about $5b under the existing tax cut regime, this totals to about a $13b per year cut in govt income.

That is about 13/50 *100 = 26% reduction in govt income. Over a period of just six years (two electoral cycles) that adds up to about $60b dollars. If we pay say 5% on that the interest bill will be $3b per year.

The interest on this projected debt alone, would have bought back the New Zealand rail system 4 times over.

The debt we are about to incur would be close to $1b less if we hadn’t purchased the railways. Slice and dice it however you like but that is close to $1b that didn’t need to be spent at this time. An analogy that would seem appropriate would be a person who has just taken a salary cut claiming that paying cash for their house (which needs hundreds of thousands of dollars spent on renovations) a few months back was a great move while they borrow money to pay the rates, insurance, electricity and to put food on the table.

A prudent financial advisor might advise them to shift their money into something productive (growth) and rent a place to live in until they can genuinely afford the house that they want to own.

I understand that talking about productive investments (growth) vs the emotional comfort of ownership makes me a right wing nut job.

“MP has claimed that we would be facing lower taxes, same levels of spending, no increased growth, and higher deficits.”

Not quite – I suppose national may have razed the books to fund those tax cuts between 2005 and now, but as I recall, National would have had to do that, plus cancel WfF and run a minor deficit for the last three years to fund their tax cuts proposed in 2005. So, right now, we’d have decreased government services (at a time when i’d argue they’re going to be more needed than ever), a string of deficits that were about to increase markedly, and a debt that would require a lot to fund.

To offset this, there would be some degree of growth those tax cuts would have instigated. Would this be enough to cancel out the costs incurred? Unlikely – there’s a reason Cullen isn’t happy with the debt he’s about to incur, yet National is happy with it, presumably beccause it will be hermetically sealed as ‘infrastructure’ debt, not tax cut costs.

If you consider this a big difference, then you’ll probably be mighty thankful that Labour has kept debt as low as possible for as long as possible, and hope that National don’t get the chance to make things worse than they are (echoes of the 90s anyone?) this time around, as they’ll almost inevitably do.

Can you list those other benefits and their value because Cullen has not – afaik there has been no published business case supporting his valuation of rail or its benefit going forward, only a few bland pronouncements around climate change.

That model didn’t work or that implementation of the model didn’t work ?

Can not allow public money to create private profit – fuck the tax payers and the public – it’s about ideology and it’s better to spend hundreds of millions to claim ownership rather than tens of millions to improve services…. That is the model that won’t work.

Burt – in brief and in haste – you’re missing a key consideration to. Tranz Rail had a private owner and were receiving public subsidies. That model didn’t work.

Becuase no other buyers would list among the “benefits’ the kinds of factors that Cullen listed in considering the general good of NZ.

I think you are missing a key consideration in this, the difference between public funding and public provision. If [xyz rich bastards railway managers Ltd.] were negotiating with a govt that cared about the public good then they would be able to factor public funding (for the good of NZ) into their pricing model and cost benefit analysis. The govt are stuck on some BS ideological position that only the govt can provide essential services because it’s the govt. This same argument can be applied to health services. Where is the benefit in slashing people off waiting lists, sending them to Aussie for medical care when we have private facilities with spare capacity?

The price of saying “we own it’ is a luxury that a prudent manager would have considered carefully before acting when they did for no bigger reason than to say “we own it’. The capital squandered so that we can say “we own it’ is almost as much as the economy can stand in new policy initiatives for the election. That was one hell of a gamble Cullen took, not the sort of gamble that qualifies him as a prudent manager.

There is no reason why the govt could not have invested additional capital into public transport without needing to tie up large amounts of public money in a recession simply so they could claim ownership. Ownership is an ideological/emotional consideration. Emotion costs money and somewhere in there we forgot what we were trying to achieve. Better, cheaper and more reliable public transport.

Only he/she/it can save us from ourselves.