About the Greens…

Written By: - Date published: 11:05 am, October 15th, 2020 - 74 comments
Categories: benefits, climate change, election 2020, greens, Metiria Turei, welfare - Tags:

I wrote a post the other day, About that wealth tax, explaining how the Green Party’s proposed wealth tax would work. It’s worth reading if you still believe that the tax will hurt Grandma and Grandad savers (it won’t).

This week the heat has been turned up on the Greens, from both Labour and National. Jacinda Ardern is busy telling everyone that Labour won’t even talk with the Greens about the tax, and Judith Collins is saying that Labour are lying and they will implement it. Green co-leaders Marama Davidson and James Shaw are both saying that income inequality is a high priority for the Greens and if they have the numbers they will be bringing the wealth tax to the negotiating table with Labour. Ball firmly in the voters’ court.

So the tax is getting a lot of air time. But here’s the thing that’s telling. Not many people (apart from the Greens) are talking about what the tax is meant to pay for (a number of things, including this awesome Guaranteed Minimum Income policy). Which is weird, because haven’t we been talking poverty for years now? Hasn’t this been a high priority for New Zealand, especially the left?

Meanwhile,

FYI, NZ’s house values have risen $75 billion to $1.3 trillion in the last 3 months. In the middle of the worst recession in living memory. With unemployment doubling. But the Reserve Bank is printing money to make the rich richer to boost the economy. Good for some. Not others.

That’s a tweet from business, economics and political journalist Bernard Hickey. There’s the argument that Labour want house prices to keep inflating, because this will support the economy and buffer the recession. That would certainly explain a few things. What it says to me is that New Zealand isn’t ready to eliminate poverty. Yet.

In the 2017 election campaign, Metiria Turei stood up and made this speech, introducing the Green Party’s radical welfare policy and talking about her own experience many years before being on welfare and what that meant in real terms.

All hell broke loose, resulting in the Greens dropping from 14 MPs to eight. I understand three things about Turei’s speech

  1. What she was talking about (and was written into policy) scared the political and business classes so much that she had to be destroyed.
  2. Nevertheless, the Greens pulled the poverty Overton Window leftward, and put a stake in the ground preventing it from sliding back. As I understand it, in that election campaign the Greens felt desperate that something had to be done and that time was running out. So they acted.
  3. She, and they, were right.

And it’s happening again. As Standardista Pat pointed out to me yesterday, “the worst thing that could happen for National would be the implementation and for the wider electorate to discover it doesn’t negatively impact them”. Hence Collins’ rabid attacks on Labour and the Greens aren’t about votes, but a last ditch attempt to wreck the chances of real change that would come from an effective wealth tax.

I’ve been a bit surprised about the Greens’ focus on the tax rather than say the GMI, but with Collins, Ardern and the MSM intent on it, I wonder if NZ just has to have it out. And if this is not only the conversation that has to happen before we get to the real conversation (ending poverty in NZ), but is also exactly the time to have it. It’s the time above all others when it cannot be ignored. If that is the case, then Go Greens I say.

Here’s the thing about the Greens. They want change. They want change more than they want power. I think that they fully understand that we are out of time on climate, poverty, the environment. That if someone doesn’t stand up for poor people now, we will cement in Labour’s deserving poor positioning for another generation.

Sure as shit when National get in next they will take the bits of Labour’s policies that serve them, tear them apart and use the remains to build a welfare system made out of barbed wire and car tyres. Just like they did last time. Only by the late 20s, we won’t have the chance to rebuild. We will be staring down the barrel of the climate and ecological crises, and quite possibly the spread of fascism internationally.

I’ve been asking for a long time how to tory-proof progressive legislation. I think this is how. If the Greens can change the culture in NZ around tax and ending poverty, get the country on board, then by the time National get in it will be much harder for them to do damage. This is triply so if we have more Green MPs in government, pulling Labour leftward and greenward and writing the legislation itself.

(for those thinking that the Greens should be solely or mostly focused on the environment, please read this piece from 2017 by Nandor Tanczos, then read the actual GP election policy on environmental issues, it’s all there).

It scares me that so many previous Green voters, and so many Labour voters are content with centre left BAU. Deep green politics fully understands the connections between climate and poverty, and between this wealth tax and our willingness to act or not on climate. It takes time to shift understanding of that. But I can’t ignore the storm clouds that have gathered outside, and the hour now is very very late.

I will be ticking Green twice when I vote and hoping that enough of us do to give the Green Party some choices post-election. I’m also mindful that most New Zealanders haven’t prioritised climate, the environment or ending poverty, and that whatever happens  on Saturday a strong extra-parliamentary activism is needed more urgently than ever.

74 comments on “About the Greens… ”

  • Comments are now closed

  1. weka 1
    15 October 2020 at 11:14 am

    the post was overly long, but there's this too,

    I am committed to ending poverty in this country.

    …

    We are the party that aims to end poverty. Frankly everybody else is interested in tinkering around the edges. We’re the only party that’s drawn a line in the sand and said we know what it takes to lift 212,000 children above the poverty line.

    James Shaw in 2017 around the GP election relaunch.

    https://thestandard.org.nz/the-greens-solidarity-and-resistance/

    None of this is a surprise (well the centre lefties still seem surprised, and it’s weird that left lefties still think Shaw is a neolib mole).

    • Macro 1.1
      15 October 2020 at 1:30 pm

      An excellent post weka, and thank you for your tireless work on this front.

      As Nandor explains, you cannot save the environment if you don't save the people first. Humans are part of the environment, and if they suffer, then the environment suffers as well.

      • bwaghorn 1.1.1
        15 October 2020 at 3:41 pm

        I doubt that .

        I bet you anything you want that the more money someone has directly equals how big their personal carbon footprint is .

        • Draco T Bastard 1.1.1.1
          15 October 2020 at 4:17 pm

          Actually, its more like an exponential increase:

          Research by anti-poverty charity Oxfam and the Stockholm Environment Institute reveals carbon dioxide emissions rose by 60 percent from 1990 to 2015. The report blames the wealthiest one percent for 15 percent of those emissions.

          That is more than twice as much carbon dioxide as emitted by the poorer half of the world.

          We actually need to save the environment to save the people but a large part of that is simply making sure that the people have enough to live on in a sustainable manner which, quite simply, means ensuring that nobody is rich because we can't afford them.

        • Macro 1.1.1.2
          15 October 2020 at 4:48 pm

          I bet you anything you want that the more money someone has directly equals how big their personal carbon footprint is .

          In a rich country that might be true in some instances but it is not necessarily true. A wealthy person may be able to afford a smart electric car, whereas a poor person is reduced to an old inefficient petrol guzzler. The wealthy can install PV, and solar hot water, heat pumps and double glazing, and fully insulate their home to cut their power bills. Not available to the poor, who may rely on an old radiator or coal fired range, if they can afford it.

          In poorer countries the poor need to rely on producing more children to ensure their survival. Not so long ago, it was not uncommon for families to have 10 or more children. Today in rich countries, such sized families are the exception rather than the rule, whereas in poor countries such as in Africa and parts of Asia they are the rule. But large families mean a drain on resources, and the environment as more demands are placed upon it.

          Protecting the environment is not just about reducing ones carbon foot print.

          • Draco T Bastard 1.1.1.2.1
            15 October 2020 at 6:01 pm

            There was actually research done a few years ago that showed that the well off can actually live cheaper than the poor. They can afford to buy in bulk, buy stuff that's more expensive to buy but cheaper to run and maintain. Turns out that Sam Vimes was correct:

            "Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles.

            But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that'd still be keeping his feet dry in ten years' time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet."

            • bwaghorn 1.1.1.2.1.1
              15 October 2020 at 6:27 pm

              Yes but mr $50 boots will be taking the latest carbon spewing contraption on an annual trip to the other side of the hub to see if the can catch a glimpse of the great turtle or some such thing.

              Something soggy toed vimes will only ever dream of.

  2. froggleblocks 2
    15 October 2020 at 11:31 am

    but a last ditch attempt to wreck the chances of real change that would come from an effective wealth tax.

    Which is NOT a policy the Greens are offering.

    Their wealth tax has got so many holes and implementation problems in it that it's a complete non-starter.

    Taxing business shares is an incentive not to create productive businesses in this country – the opposite of what we need.

    Applying the tax to all assets worth $50k or more is going to result in a huge amount of paperwork for valuation purposes, and people are going to do whatever they can to avoid paying this tax.

    A land tax or TOP's property tax are far better – will raise almost as much money as this wealth tax, while being far easier to administer and harder to evade.

    • weka 2.1
      15 October 2020 at 11:39 am

      as I understand it, the GP position is to take any legislation through a public consultation process, so there would be plenty of time to improve the policy. Or, maybe between the Greens and Labour they come up with something else.

      So the reactions against the policy seem largely about resisting the shift I am talking about in the post. TOP have some good ideas, but they are economists, not poverty activists, and there are big holes in their policies from a welfare/poverty eradication perspective. They would also support a Nat government, giving National power and allowing National to adapt their policies to the car tyre and barbed wire ethos.

      • froggleblocks 2.1.1
        15 October 2020 at 12:59 pm

        as I understand it, the GP position is to take any legislation through a public consultation process

        Except that's not what any of them have been saying. Chloe repeatedly says it's 1% above $1M, 2% above $2M, and only the top 6% of people would be affected.

        She hasn't said "this is just a starting point, to start a discussion".

        They would also support a Nat government, giving National power and allowing National to adapt their policies to the car tyre and barbed wire ethos.

        Actually they’ve said they’d support any other parties that support their policies, which is no different than what the Greens say.

        So the question is really would National support TOP policies. Given how close TOP comes out to Labour on the political compass, this seems unlikely.

        • solkta 2.1.1.1
          15 October 2020 at 1:15 pm

          Of course they campaign on what the policy actually says, none of them are named Cunliffe. But all draft legislation goes through the Select Committee process.

        • weka 2.1.1.2
          15 October 2020 at 1:27 pm

          I didn't say it was a starting point for discussion. It's a fully costed policy, because that's what the Greens do. It's not a Bill in final form. There will be opportunity for public input.

          "Actually they’ve said they’d support any other parties that support their policies, which is no different than what the Greens say."

          Afaik, TOP are happy to give C/S to National, or be in coalition with them. The Greens have explicitly ruled both those out. Yes, both parties will work with any other party on shared policy, but that's a different thing than supporting formation of govt.

          "So the question is really would National support TOP policies. Given how close TOP comes out to Labour on the political compass, this seems unlikely."

          The other scenario is the mirror of the situation that L/G are in now. A coalition or a minority govt. Nat could have the right to form govt and choose to have TOP support that. TOP won't say no.

          • froggleblocks 2.1.1.2.1
            15 October 2020 at 2:02 pm

            I didn't say it was a starting point for discussion. It's a fully costed policy, because that's what the Greens do. It's not a Bill in final form. There will be opportunity for public input.

            Except they've already used all the potential money from this policy for their UMI policy. Any substantive changes to the tax policy would then fail to fund their UMI (and other changes).

            The Greens have explicitly ruled both those out.

            Because National doesn't agree with their policies, not because they don't like the name National or their leader or any other esoteric reason as you're trying to suggest. It's because of policy differences, nothing else.

            If National didn't agree with TOP's policies, then TOP wouldn't go into coalition with them, just like Greens won't go into coalition with them because they won't agree with Greens policies.

            TOP won't say no.

            Citation needed.

            • Draco T Bastard 2.1.1.2.1.1
              15 October 2020 at 4:32 pm

              Except they've already used all the potential money from this policy for their UMI policy.

              1. So? The minimum income policy can also be changed
              2. The government doesn't actually need the income to pay for policies

              Because National doesn't agree with their policies, not because they don't like the name National or their leader or any other esoteric reason as you're trying to suggest. It's because of policy differences, nothing else.

              And the reason why the Greens don't like National is because of their policies.

    • Pat 2.2
      15 October 2020 at 11:50 am

      The TOP proposed property tax is no more simple than the Greens Wealth tax and has a number of administrative nightmares/ exclusions included in its make up but more importantly TOP are not going to be in a position to promote their tax policy into reality anytime soon

      • RedLogix 2.2.1
        15 October 2020 at 12:14 pm

        TOP's CCT was just part of a more comprehensive package of reforms designed explicitly to address the inequity issues that our tax system has developed. It has both horizontal and vertical equity built in.

        Horizontal equity treats similar cases types in the same fashion. So for example the CCT treated all asset classes, real estate, shares, art works, etc identically. It treated the 'family' home the same as an investment.

        Vertical equity means that within the same class of tax, whether large or small the treatment is the same. In other words you avoid thresholds or dramatic step changes in rates.

        Our current system is riddled with these distortions, and they keep a whole industry of tax minimising professionals in business. A well designed tax system heads in the other direction, with a broad tax base that is either hard or barely worth avoiding.

        While the motive behind the Green's asset tax is reasonable, it's implementation lacks both types of equity that I described above. It's not a smart tax.

        • Pat 2.2.1.1
          15 October 2020 at 12:56 pm

          Have no idea what you are referring to when you say CCT…there is nothing resembling that in TOPs manifesto that I can find…there is a small amount of detail re their property tax however and it is anything but simple as claimed and contains a number of exclusions and has areas apparently completely unconsidered.

          • RedLogix 2.2.1.1.1
            15 October 2020 at 4:14 pm

            CCT was the term originally used for their "Comprehensive Capital Tax". More recent material may use a different term.

      • froggleblocks 2.2.2
        15 October 2020 at 12:56 pm

        The TOP proposed property tax is no more simple than the Greens Wealth tax

        Yes, it is. It sounds to me like you're talking about their 2017 policy, which is no longer their policy.

        Their 2020 policy is to tax property (houses, land) and use council valuations to do so.

        Far simpler than Greens' wealth tax.

        • Pat 2.2.2.1
          15 October 2020 at 12:58 pm

          This…updated Sept 2020

          https://www.top.org.nz/property_tax

          have a look at the (so called) detail and FAQs

          • froggleblocks 2.2.2.1.1
            15 October 2020 at 1:03 pm

            Right, so how is that "just as complicated" as the Greens wealth tax, which requires look-through ownership for trusts, an unspecified way to tax offshore / international wealth, and requiring valuations of all assets over $50k?

            • Pat 2.2.2.1.1.1
              15 October 2020 at 1:21 pm

              are council ratings valuations contestable?

              what are the revenue implications of offsetting farm income against land value?

              how is commercial/industrial property captured or is it not?

              how is a discrepancy of value on disposal dealt with?

              what are lifestyle blocks that registered for GST classed as?

              why target those entering the housing market at the same level as those who have already benefited from decades of untaxed appreciation?

              It is better than nothing but it has many of the same difficulties that any attempt to tax assets has …and a few extras that are unnecessarily complex for political expediency and captures a much narrower band of assets than the Greens proposal at at a much lower level….it does little to impact inequality and I suspect it will generate considerably less in revenue.

              • froggleblocks …
                15 October 2020 at 2:04 pm

                are council ratings valuations contestable?

                This issue applies to the Greens policy.

                what are the revenue implications of offsetting farm income against land value?

                This issue applies to the Greens policy.

                how is commercial/industrial property captured or is it not?

                It's property so it's captured. This issue applies to the Greens policy.

                how is a discrepancy of value on disposal dealt with?

                This issue applies to the Greens policy.

                what are lifestyle blocks that registered for GST classed as?

                Presumably they’d be treated like a farm. Not that difficult really.

                why target those entering the housing market at the same level as those who have already benefited from decades of untaxed appreciation?

                Those entering the housing market will have a large mortgage, low equity, and therefore minimal tax under TOP's policy. Everyone also gets a $13k UBI, unlike the Greens' policy. By treating all property equally, it doesn't create loopholes like Greens' policy does.

                • Pat …
                  15 October 2020 at 2:22 pm

                  'this issue applies to the Greens policy' is the point and you claimed it was simpler…it isnt, and the Greens policy will capture a wider class of assets but again as originally stated the Greens policy has far more chance of being on the table than TOPs as they are barely registering in the polls

                  • froggleblocks …
                    15 October 2020 at 3:09 pm

                    is the point and you claimed it was simpler

                    Er, no.

                    If the Greens policy has a complexity and loophole score of 100, TOP's policy might have a complexity and loophole score of 60, and the status quo is 40.

                    60 is still less than 100. Even if TOP’s policy shares some of the complexities of Greens policy, it’s still far simpler overall.

                    again as originally stated the Greens policy has far more chance of being on the table than TOPs as they are barely registering in the polls

                    Jacinda has categorically ruled out the Greens wealth tax. She hasn't ruled out TOP's tax policy.

                    Also championing a policy that's really outrageously crap because it has a higher chance of being implemented than a policy that's a lot better, when all you have is 1 vote to spend on either policy, is a stupid way of choosing who to vote for.

                    • Pat …
                      15 October 2020 at 3:14 pm

                      "If the Greens policy has a complexity and loophole score of 100, TOP's policy might have a complexity and loophole score of 60, and the status quo is 40."

                      That is where we differ then because from the information available you can redo those ratings for effectiveness to TOP 40, Green 80 , status quo about 10….AND the Green policy has vastly more possibility of being implemented (low though it may be)

                    • Drowsy M. Kram …
                      15 October 2020 at 3:21 pm

                      "Jacinda has categorically ruled out the Greens wealth tax. She hasn't ruled out TOP's tax policy."

                      Ruled out the Tax Working Group's CGT recommendation, and now the Green's wealth tax. Two reasons not to vote Labour right there.

                    • Pat …
                      15 October 2020 at 3:34 pm

                      not to mention that the TOP tax targets way down the asset class to the benefit of those holding substantial assets…wonder why that might be?…in fact I think I'll change my rating of TOPs land tax. downwards..the more I look at it the bigger dog it becomes

    • Brigid 2.3
      15 October 2020 at 12:12 pm

      "Their wealth tax has got so many holes and implementation problems in it that it's a complete non-starter." Could you be specific?

      Also, knowing damn all about the machinations of the share market and it's relationship to business productivity, could you explain how the value of business shares necessarily reflects the value of investment in the business itself? As far as I'm aware if I (and many others) buy shares the result is an increase in the value of those shares, not an increase, necessarily, in investment in the actual company.

      Except in the case where the shares are a new issue. That I can see is an investment in the company.

      • Pat 2.3.1
        15 October 2020 at 12:47 pm

        you are quite correct re shares….and there are few holes in the wealth tax proposed, I suspect thats why its railed against so much

    • Draco T Bastard 2.4
      15 October 2020 at 1:04 pm

      Taxing business shares is an incentive not to create productive businesses in this country

      The bludging that comes with ownership of shares is the problem.

      Applying the tax to all assets worth $50k or more is going to result in a huge amount of paperwork for valuation purposes, and people are going to do whatever they can to avoid paying this tax.

      Yes, more bludging by the unscrupulous. The idea there isn't to reward them by continuing to allow their bludging but so that they simply can't dodge the taxes.

      A land tax or TOP's property tax are far better

      They're very similar so, no, not far better.

      And, yes, going through the parliamentary policy process would result in the bill being made better. So, that is not a valid argument against the policy.

      Your comment sounds like whinging I'd expect from the unscrupulous bludgers.

  3. UncookedSelachimorpha 3
    15 October 2020 at 11:33 am

    Excellent post. You are absolutely right that there has been incredibly little discussion on the benefits the Greens are proposing, which will flow on from the Wealth Tax (GMI etc).

    • weka 3.1
      15 October 2020 at 11:40 am

      Cheers US. I'm really looking forward to seeing where the debate goes in the coming year. It's a potent time with covid and the recession, but I think Labour's inability to address the housing crisis is going to be a big deal in term 2.

      • sumsuch 3.1.1
        15 October 2020 at 10:59 pm

        The housing crisis here in Gisborne is hell. The neediest are being ground between two vices. While up there in the clouds the middle class dispute with no real knowledge. Despise it.

  4. Tony Veitch (not etc.) 4
    15 October 2020 at 11:42 am

    Well said weka.

    I'm reminded of an old quip – from prohibition era Chicago I think – 'vote early and vote often.'

    I regret I have only one party vote to give to the Green party.

    By the 2026 election it may well be too late to stem the tide of catastrophes threatening to overwhelm human life on this planet.

  5. RedLogix 5
    15 October 2020 at 11:58 am

    I like the Green's motivations; but sadly I find too many of their solutions feel like they were lifted direct from the pages of The Whole Earth Catalog. Nothing really wrong with them, except insufficient for a planet of 10b humans.

  6. Dennis Frank 6
    15 October 2020 at 11:59 am

    The moral case for the wealth tax is unassailable: we need a design solution to the inequality problem. My issue has always been it's utility as a political strategy – plus an emerging liability in the marketing of it.

    That's due to leftist ideology, of course. The sectarian mind-set is unable to encompass consensus politics because the self-imposed ideological blinkers always screen it out.

    However if the Greens do enter into govt with Labour post-election then pragmatism will kick in. I'm confident it will defeat ideology during the negotiations.

    What I'm waiting for is the numbers. I have been predicting that those the tax is intended to help most will refrain from voting for it. The poll tonight will provide preliminary evidence of the GP marketing failure, I expect.

    • weka 6.1
      15 October 2020 at 12:16 pm

      how is it a failure? If NZ doesn't want the tax, then the Greens will take a hit from this. But if they shift the overton window, again, then it's a win. That's what the post was about.

      Talking about ending poverty is a useful political strategy. I would say at this point it's impossible to end poverty, or even reduce it, if we don't talk about the problems in a way that makes everyone take notice.

      • Dennis Frank 6.1.1
        15 October 2020 at 12:48 pm

        how is it a failure?

        Politics is a numbers game. You don't win without getting the numbers onside. I agree that it is necessary to shift the overton window. However I believe those who would benefit most from the shifting ought to be the ones that force the shift!

        Until they become proactive, others trying to do it for them are vulnerable to the accusation of paternalism. The working class did actually self-organise in the 19th century. The historical record shows that they drove political changes through to their benefit. The current equivalent ought to be able to do that too.

        • solkta 6.1.1.1
          15 October 2020 at 12:56 pm

          Yes, and there are very few obese people in the Greens (it true) so they shouldn't be trying to fix that problem either. frown

        • Draco T Bastard 6.1.1.2
          15 October 2020 at 1:25 pm

          However I believe those who would benefit most from the shifting ought to be the ones that force the shift!

          And how are they going to do that?

          As much as poverty is increasing those in poverty are still a minority and, as you say, politics is a numbers game.

          The working class did actually self-organise in the 19th century.

          The working class were, and still are, a majority. It even includes most of those in poverty. But the majority of workers don't seem to be inclined to support those in poverty. Perhaps because of our government's policy of maintaining high unemployment to keep wages down.

          The historical record shows that they drove political changes through to their benefit.

          At a time when there was a depression on and everyone could see that the old system wasn't working as the economists said.

        • Macro 6.1.1.3
          15 October 2020 at 1:40 pm

          Luke 18: 24 -25

        • Incognito 6.1.1.4
          15 October 2020 at 11:15 pm

          Politics is a numbers game. You don’t win without getting the numbers onside. I agree that it is necessary to shift the overton window. However I believe those who would benefit most from the shifting ought to be the ones that force the shift!

          Your lack of political nous is astounding! The shifting of the Overton window rests with the politicians.

          https://en.wikipedia.org/wiki/Overton_window

          It appears that Ardern/Labour will be getting the numbers onside but what will they do with this mandate and political capital?

          “What I’ve consistently said is you’ve seen significant issues we’ve worked to form a consensus on, so that’s how you create lasting change,” Ardern told media.

          Ardern insists that being a consensus politician doesn’t mean she’s a centrist politician.

          “I am a progressive. I do seek change for the better but I will try and bring people with me,” she says.

          If the Greens do get to negotiate a deal they’re not giving up on a wealth tax, despite Labour ruling it out. Increasing benefits is also a top priority.

          Refusing to talk about stuff outright seems to contradict the consensus approach. Ardern/Labour come across as fair-weather progressives, which is not actually progressive; when it gets too hard or inconvenient, put it in the too-hard drawer and refuse to talk about it – Overton window nailed shut.

    • Bearded Git 6.2
      15 October 2020 at 12:33 pm

      Dennis-the Greens were shouting about climate change decades ago. Now almost everyone has realised they were right.

      The same will happen with poverty/wealth redistribution….or there will be blood in the streets one day.

  7. Matiri 7
    15 October 2020 at 12:12 pm

    Excellent post

  8. Drowsy M. Kram 8
    15 October 2020 at 12:22 pm

    Timely post – poverty in NZ must be addressed, preferably by transitioning from placing ambulances at the bottom of the 'poverty cliff' to decreasing the height of the cliff.

    "Years of research show the social gradient of death is not a poverty cliff-edge but that it runs in a straight line from bottom to top: on the graph people get gradually healthier as they get richer. The grim reaper may wave a coronavirus scythe at the Prince of Wales, the prime minister or Tom Hanks, but death prefers the more fertile territory of Newham, Birmingham and Liverpool."
    https://www.theguardian.com/commentisfree/2020/may/05/poverty-kills-people-coronavirus-life-expectancy-britain

    And it needs to happen while NZ is a relatively wealthy country – ameliorating wealth inequality would build societal resilience in the near future. Poverty in NZ is a much easier problem to tackle than climate change, but the wider electorate's response to Turei's honesty about her historical (poverty-related) dishonesty doesn't give me a lot of hope.

    In her essay below, Liang describes poverty as a “heritable condition” that perpetuates and amplifies through generations: “It is also not hard to see how individual poverty flows into communities and society, with downstream effects on economics, crime and health, as well as many other systems. Loosen one strand and everything else unravels.”

    A Kete Half Empty

    Poverty is your problem, it is everyone’s problem, not just those who are in poverty. – Rebecca, a child from Te Puru

  9. Bearded Git 9
    15 October 2020 at 12:28 pm

    Nicely put Weka. People telling to the Greens to STFU need only read your excellent post to understand why this is never going to happen.

    I have already party voted for the Greens but gave Labour the candidate vote because if anyone can beat Jackie Dean in Waitaki it will be Labour. (and voted YES-YES of course)

    I have also helped re-erect both Green and Labour billboards on numerous occasions with a mate-the wreckers have been in good form at this election.

  10. left_forward 10
    15 October 2020 at 12:30 pm

    Excellent Weka – entirely agree with your well-articulated thoughts.

  11. Draco T Bastard 11
    15 October 2020 at 12:36 pm

    Not many people (apart from the Greens) are talking about what the tax is meant to pay for

    I’ve been a bit surprised about the Greens’ focus on the tax rather than say the GMI, but with Collins, Ardern and the MSM intent on it, I wonder if NZ just has to have it out.

    I'd prefer to have the conversation about how the government doesn't need tax to pay for things. That tax is for other purposes than income for the government.

    A discussion about how the rich and business don't pay for anything. That it is, as a matter of fact, government spending that pays for everything including the profits of the rich.

    I think that this discussion is essential if we want to eliminate poverty and inequality.

    There’s the argument that Labour want house prices to keep inflating, because this will support the economy and buffer the recession.

    The present house price hyper-inflation allows the private banks to create more money which then gets spent into the economy thus adding to GDP. This looks good to the government and so they support it despite the fact that it increases poverty and leads to unsupportable private debt. The same debt that caused the GFC.

    What it says to me is that New Zealand isn’t ready to eliminate poverty.

    The average NZer wants to eliminate poverty but they also want to be rich and so they support the policies that would allow them to be not seeing the connection between those policies and the poverty that they create.

    We will be staring down the barrel of the climate and ecological crises, and quite possibly the spread of fascism internationally.

    We already are which is why I'm so pissed about the Greens still wanting to neuter the defence forces completely contrary to their published policy.

    I will be ticking Green twice when I vote

    Is that actually going to help?

    Will it elect a Green electorate MP?

    Or just help in a National MP?

    It is, in our present system, better to electorate vote Labour and party vote Green.

  12. Herodotus 12
    15 October 2020 at 1:49 pm

    Thanks for this, and this may surprise any who read my comments, out of 3 voters in the family 66.7% have gone Green 😱. Thought that this would be the only major party that I would never vote for. But sometimes you have to vote against what would have a negative financial consequence for the greater good (I so hope so)

    No Green candidate here and a choice of 5. So many parties are invisible out here that had previously some identity.

  13. Tiger Mountain 13
    15 October 2020 at 2:06 pm

    Good post. There has been a surfeit of Labour triumphalism from certain posters at The Standard the last several weeks. Lets see where the ticks land on Sat. night.

    I party voted Green, and so did my partner to my surprise who previously was “two ticks Labour”, I only stated my reasons once, but she had been thinking about it for several weeks regardless and told me she decided the Greens need to be in Govt. to ensure a Labour Govt both happens, and is not stand alone, and to represent on Climate Action.

    As for housing, a massive state house/apartment build over a decade would naturally rearrange the speculative property and rental exploitation markets by share force of supply.

  14. Matthew Whitehead 14
    15 October 2020 at 3:01 pm

    I actually think there's a really sound strategy to keeping the noise on the wealth tax now that Labour’s not on our side on this subject too, rather than the GMI. I want both, but if we have to sacrifice one in talks, let's sacrifice the tax, and pay for welfare reforms some other way- perhaps by adding additional high-earners brackets to income tax, or a land tax, or something that lets Labour dodge their defensiveness on this issue. Hell, I'd even take not offsetting the cost if they insist on opposing all our revenue proposals. I'm perfectly happy to come in after the election and take over MSD and ACC for the Greens and let Labour have their "win" on tax if that's what's needed to do a realistic deal.

    I expect news of our GMI policy has already reached the people it needs to reach. We don't need to fight the right about it if that's the case. 🙂

    • weka 14.1
      15 October 2020 at 6:03 pm

      I feel similarly. It's a good opportunity to talk about wealth, but the Greens haven't said it's a bottom line and I'm also fine if it doesn't happen but they get some of the welfare policy through. Pragmatics. People are freaking out over it despite this, which I find interesting.

  15. Anne 15
    15 October 2020 at 3:05 pm

    … she decided the Greens need to be in Govt. to ensure a Labour Govt both happens, and is not stand alone, and to represent on Climate Action.

    And that is precisely why I will probably give my party vote to the Greens – assuming there is no major turnaround in this week's polls.

    Mankind along with the rest of nature is facing extinction in a horrifyingly short space of time. That is why it is so essential the Greens remain in parliament.

  16. Climaction 16
    15 October 2020 at 5:08 pm

    This is all bullshit. The wealth tax is an inefficient response to Jacinda cravenly ruling out the Capital Gains Tax at the behest of NZ1. Which gives lie to the claim the greens don't care about power. they were in government when this happened and will support Jacinda / Labour into the next government, perpetuating the problem.

    CGT captures the value increase in wealth and taxes it's transfer. A wealth tax will largely penalise homeowners in Auckland who've stayed put for twenty years.

    • weka 16.1
      15 October 2020 at 6:01 pm

      "A wealth tax will largely penalise homeowners in Auckland who've stayed put for twenty years."

      A small number of long term Auckland homeowners, most of whom will be wealthy if they have more than $2m assets in the clear.

      How many people do you know that fit the actual criteria in the policy?

      • Climaction 16.1.1
        16 October 2020 at 8:52 am

        I know a number of people who aren't wealthy, worked hard, paid their mortgate off and through no fault of their own are now in possession of 1.5m and up homes, staring down the barrel of retirement. And if this tax goes ahead it will rob them of $15k+ of their retirement income if they stay put in the community they've lived in for so long. the community they know.

        And it will get worse each year if house prices continue to increase in auckland as they are. $15k becomes 16.5k plus the valuers report.

        This is ill thought through.

        I notice you've ignored the CGT and the craven way this government and all entities within it have handled it.

        At least with a CGT, those people who have worked hard, sacrificed and made their way quietly will only be taxed on a gain, and only when they sell it. If the greens want a real bottom line they should put a CGT back on the table as a real bottom line now that NZ1 have gone.

        [There’s been way too much misinformation on this policy, some ignorance, some deliberate. If you misrepresent Green Party policy like this again, I will ban you. You’ve had ample opportunity to get up to speed with what the policy actually says, and now myself and Incognito have corrected you. . Making a note in the back end – weka]

        [update. Just seen the last note in the back end re this https://thestandard.org.nz/kia-kaha-greens/#comment-1746316 Pattern of behaviour, you’ve been warned before. 6 month ban – weka]

        • Incognito 16.1.1.1
          16 October 2020 at 9:49 am

          Your irresponsible ignorance is irascible.

          A couple can have a net wealth of up to $2 million without having to pay a cent in WT.

          Please educate yourself on matters that you comment on, thanks.

        • weka 16.1.1.2
          16 October 2020 at 11:01 am

          "This is ill thought through."

          Well your comment certainly is.

          Assuming we're talking a single person (as Incog points out, for couples the threshold is $2m), then they have a house that is worth $1.5m, freehold, and no other assets, savings etc.

          They get taxed 1% on the $500,000 = $5,000 in the first year. They can't afford that, so they defer payment.

          For sake of simplicity, let's say that they sell the house 15 years later to move into a smaller house, and have 15 years of deferred payments.

          They pay $75,000 in tax and they get to keep $1,425,000.

          In effect, this is a capital gains tax.

          What are the chances that they can't buy another house for that where they live? Yes, you can argue that prices have gone, but so then has the value of their house.

          What you appear to be arguing, despite the rhetoric about CGT, is that someone in that situation shouldn't pay tax on capital gains.

        • weka 16.1.1.3
          16 October 2020 at 11:05 am

          mod note.

  17. Grafton Gully 17
    15 October 2020 at 6:07 pm

    https://www.bloomberg.com/news/articles/2020-10-14/a-just-in-case-world-is-rushing-to-hoard-food-as-prices-rally

    Greens wealth tax a smug and unrealistic distraction from the real issues – a pandemic out of control internationally, tanking employment here and across the Tasman and threatened food security.

  19. sumsuch 19
    15 October 2020 at 9:44 pm

    Only 3 of my FB friends, out of 14 odd to be truthful, responded to my post saying everything is about climate change and vote Left, which can't include Labour.

  20. sumsuch 20
    15 October 2020 at 9:47 pm

    The personnel of the Greens make me puke green. Spoze at least we don't buy into hero figures.

  21. sumsuch 21
    15 October 2020 at 10:20 pm

    The heart of the Left is expressed in the policies of the Greens, Maori and TOP. Labour are people who are scared of their shadows.

    Like them many of us oldies have been burnt. That's how confronting power is. Labour doesn't understand, like middle class me and my brothers didn't. My borderer working class egotist g.grandfather did. If he'd waited in Britain he'd have been made a lord, here he didn't even make the Legislative Council. A sure sign of the demise of our social democracy.

  23. PaddyOT 23
    16 October 2020 at 3:44 am

    I would support a wealth tax but for reasons explored not a broad asset targetted tax but closer to a more targetted CGT type tax in our NZ setting where wealth is harboured now in an unacceptable, predatory housing grab- a major cause of poor wellbeing and poverty explained later.

    With the proposed Green's WT, even if the practical and legal issues were surmountable ( with a growth in IRD jobs to administer and gain compliance with the complexities of a WT) , much research commentary about wealth tax points to implementing a broad WT as being the cause of anti-growth amounting to " lower investments in human capital and the creation of new businesses.” and a larger disincentive to saving.

    The wealth tax has failed in most other countries. In 1990, 12 member countries of the Organization for Economic Cooperation and Development had wealth taxes. By 2017, that number had fallen to just four. One reason other than the complexity of gathering the WT was wealth taxes were levied on households with little cash but substantial illiquid wealth due to too LOW exemption thresholds. These households would also include in NZ the accidental wealthy whereby an out of control property market makes an appearance of being wealthy when caught up in a broad horizontal tax application. The true super wealthy have means to hide assets and evade wealth tax( legal responses by taxpayers to reduce their tax exposure as well as illegal evasion), where as this group of one single- home ownership cannot hide the house.

    https://www.brookings.edu/blog/up-front/2019/09/05/estimating-the-economic-impact-of-a-wealth-tax/

    A look at the 4 European nations that still collect WT also shows a significantly low capture of monies overall into government coffers.

    • "European wealth taxes generally brought in around 0.2% of GDP in revenues…
    • Its never been a substantial generator of tax money for the Spanish government. Data from the OECD shows that a net wealth tax on individuals made up 0.55 per cent of all tax revenues in 2017.
    • The amount of revenue generated has largely been the same over the last two decades. The OECD reported the wealth tax constituted 1.1% of all Norwegian tax revenue in 2017.

    • the Swiss wealth tax has generated consistent revenue so far in the 21st century and it brought the largest share. OECD data shows that wealth taxes made up 3.6% of all Swiss tax revenue in 2017, and it’s been above 3% since 2000.

    https://www.businessinsider.com.au/4-european-countries-wealth-tax-spain-norway-switzerland-belgium-2019-11?r=US&IR=T

    Other references on the European scene showed a negative impact when thousands of pissed off wealthy citizens departed their country taking wealth with them.

    An OECD review concluded that administrative difficulties, modest revenues, and failure to adequately address wealth inequality are among the main reasons why most member countries have abandoned wealth taxes.

    OECD (2018), The Role and Design of Net Wealth Taxes in the OECD, OECD Tax Policy Studies, No. 26, OECD Publishing, Paris. doi: 10.1787/9789264290303-en

    Of concern too was where the wealth tax take is transferred to, whether anti-poverty policies were enacted into actual poverty reduction or whether wealth tax take was instead being utilised mainly for overall fiscal debt reduction.

    What can be targetted in NZ rather than a broad asset WT is addressing a major area of concern which is the poverty enforced on households because rent takes an unacceptable proportion of income and or home buying is now off the table for many.

    In the NZ scenario much wealth is locked up in housing as a very profitable investment and tax free on its gain once liquidated.

    Lack of political action to disincentivise is one significant reason for poverty and homelessness. Labour also complicit over time in creating this crisis shame.
    History now shows home ownership as no longer being seen by government as a 'social good or necessity' for the poorer citizen but instead housing treated by government as a market good.

    A wealth tax in NZ may give material relief or more support services for the poor but will not make houses affordable for low income families nor thought to slow house prices down. Young people in NZ now make up a high proportion of our overall homelessness statistics. Overall wellbeing is poorer in NZ because of lack of house security.

    A very recent, more thorough examination of NZ's out of control predatory housing grab and measures to abate this wealth hiding haven is explored on the Policy Commons. The Green’s goals of poverty reduction is discussed and has much in common with outcomes of the PC piece

    " Allowing the crisis to continue unabated will do lasting damage to health, inequality, levels of debt, and the hopes of a generation. To take action to prevent this from happening we need to understand how we got here (Part II). We need to be clear about what kind of society we want to move towards and how housing fits into that vision (Part III). And we need to set out the steps that can be taken to move towards that broader vision (Part IV)."

    What needs to happen-:

    " Decentring home-ownership

    Decolonising housing policy

    Democratising housing policy-making

    Decommodifying housing

    Proposed is ten policy ideas for greater consideration, arising out of this new paradigm:

    A Ministry of Public Works

    A Green Investment Bank

    A State Lending Agency

    Transferring Regulation of Mortgage Lending to Parliament

    Enabling Public Sector Leadership for Housing Policy

    Supporting Tino Rangatiratanga in Housing Policy

    Fair Taxation of Housing

    Expanding State and Community Housing

    Enhancing the Rights of Renters

    Tackling Homelessness "

    https://www.policycommons.ac.nz/2020/10/06/transformative-housing-policy-for-aotearoa-new-zealand/

    Wealth tax can be applied in different forms to address poverty. One of the meritous recommendations of direct benefit to reduce "The rise of the unbridled market" particularly in the NZ scene to disincentivise house grabbing and to generate bigger tax revenue dollars from housing wealth was

    " modifying the bright-line test so that it applies to all second or third homes bought and sold, with NO set time frame. Applying the bright-line test to all second homes may catch some baches; third homes are likely to be a very reliable proxy for properties that are investment assets."

    Outside of housing as a tax haven, as stated in an earlier post and by others was that greater tax revenue needs to be generated by further stringent cracking down on tax compliance; closing holes for corporate and of super- wealthy individuals using tax shelters; through implementing mandatory independent auditing, say every two years, for the ever increasing discretionary family trusts ( in line with how Charitable Trusts must comply); and more rigorous tax collecting of monetary transfers of NZ made dollars to offshore.

    Increasing corporate tax revenue seems more palatable if not more just than taxing the average accidental cash poor yet wealthy house owner.