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Cutting through the bullshit

Written By: - Date published: 11:12 pm, September 2nd, 2010 - 24 comments
Categories: Economy, spin - Tags:

We’ve heard a lot from the apologists about how there was no alternative to the South Canterbury Finance bailout in the last couple of days.

It’s come with a whole lot of talk about the details focused on who let SCF into the scheme (answer National) who first allowed for finance companies to be eligible for the scheme (answer: Labour) and how the whole thing happened (answer: it depend who the scape-goat of the moment is) and, of course, a plethora of complexly financially-justified scenarios of what would have happened if we hadn’t bailed investors out.

At times like this detail is used for misdirection all over the place. Anyone who has done a lot of sharp business negotiations will know the tactic intimately: muddy the waters with detailed “analysis” that draws away from the main point, throw in a few what-ifs and whatever you do make sure you shift the parameters of the argument into as many blind side-alleys as possible.

The key thing is to create a sense of urgency and complexity that distracts people from the big picture or makes them doubt they understand it. It’s a kind of spin version of the Stockholm syndrome.

In my experience the best thing to do to neutralise this tactic is to cut through the bullshit, step back and readdress the main point.

In this case the main point is that the government has just spent $1.77bn of our money on bailing out already wealthy investors.

Over the next few weeks the shills will try all sorts of misdirection drawing on all sorts of peripheral financial and political arcana and there will be all sorts of technical-sounding claptrap spouted by commentators who have just discovered they’re finance experts.

They may even convince the public they’re right. They’ll certainly convince journalists they’re right.

I watched exactly the same thing happen back in December of 1987 when the fourth Labour government passed legislation to sell off public assets and transfer massive amounts of wealth from the public to a few private interests.

At the time they used the confusion and chaos created by the stockmarket crash just a couple of months before to help drive their agenda.

Of course nowadays nobody remembers the ridiculous sophistry used to justify that theft but at the time it seemed really important. Like really, really really important. Mostly I suspect people now just wonder how the hell we allowed it to happen.

The funny thing is I don’t doubt that in a couple of decades time people will be wondering the same thing about the decision to hand over $1.77bn of public wealth to private individuals.

The more things change, eh?

24 comments on “Cutting through the bullshit ”

  1. outofbed 1

    Where are Labour on this?
    If this was reversed can you imagine the furore
    When they were in opposition the National party were rapid attack dogs
    The Labour Party in contrast are like pussies WTF
    I really don’t want to attack labour the left should stick together but FFS
    Its so annoying Labour is my natural home but how could one vote for that lot of ineffective centrist tossers?
    If they get away with the CFS bailout the opposition has to shoulder some blame
    I guess we all know in our hearts of hearts Goff would have done the same. I despair

    • Loota 1.1

      ^ +1 godsdammit the sun is shining why is Labour not making hay. The sheer timidity, my gods!!!

      Unless its a cunning plan. (Hope against hope).

      • prism 1.1.1

        We need Blackadder and his offsider Baldrick with the cunning plans assisting Labour’s strategic plan (which is?) to counter the National machiavellians and renowned C&W band, Tex and Bing (Crosby).

    • Draco T Bastard 1.2

      Very good question – where are the opposition that are supposed to be highlighting such thefts of public money?

    • Bill 1.3

      Don’t forget that Goff has principles. And that those principles are Tory principles. And that the voice of the party is controlled form above.

      • IrishBill 1.3.1

        The other question is where are the Greens on this? I think there are a lot of pollys who don’t feel like they can deal with this because of the “complexity” of it.

        • The Voice of Reason 1.3.1.1

          ” And that the voice of the party is controlled from above.”

          God votes Labour?

        • outofbed 1.3.1.2

          The Greens have been banging on about not selling any of SCF to foreign companies
          http://www.scoop.co.nz/stories/PA1008/S00495.htm but nothing about the obvious corruption and greed that has taken place. This is lamentable, I suspect this has to do with being a small Party with limited research facilities.then anything else
          If the opposition can’t or won’t and the msm is the msm I suspect you are right, this will never get the scrutiny it deserves

          • mickysavage 1.3.1.2.1

            You can be sure that the OIA requests have been made and the information is awaited.

            For me the stunning decision is to continue SCF’s cover earlier this year when there were already signs it was in trouble.

            The scheme was to stop a run on the finance companies and to keep the cash flowing. Those concerns no longer exist and I cannot unserstand why there was a need to continue cover.

        • Shane Gallagher 1.3.1.3

          Don’t forget the Greens only have 9 MPs and they do a huge amount of work already – they do not have the time or the resources to answer everything that happens
          – Labour have plenty of bodies sitting around apparently doing SFA. I do not know what they are thinking but NACT keep handing Labour sticks to beat them with and Labour just stuffs up every time. Are they THAT clueless and THAT lacking in talent? The Green MPs are running themselves ragged trying to be an effective opposition whilst most Labour MPs seem to be doing absolutely nothing.

    • John 1.4

      You’re 100% right they are centrist tossers. Re outofbed’s comment above( 1st comment)

  2. Bill 2

    What I want to know is how much is Hubbard a fall guy or a mark or whatever the correct term is?

    His company failed. We get that.

    But my head glitches a wee bit when he says that the company would never have been put into receivership or investigated or whatever if Johnny Boy had been in the country. ( Sorry, can’t source)

    I’m willing to go along with the line that he was a financier with a conscience that was informed by his Christianity. The Listener put together a several page feature article back in May which is worth a read. It’s here. The first three pages are ‘Papa Smurf’. Thereafter it deals with events time-lines and names.

    Now, if I’m a financier in a position of knowledge and power and corrupt, corrupt, corrupt (Johnny Boy) and I see an opportunity to make a killing ( I can do it indirectly for ‘favours owed’), then what better to lead an old school boy and his throat right on up that garden path. As a cover. People will baulk at calling for the blood of a (benefit of the doubt) self made financier who had a genuine concern for those he aided and abetted to succeed against an intransigent and uncaring banking system. (Pages 1through 3 of the Listener article = nice guy…. and then fact that there were street demos in Timaru in his defence that seemed reasonably genuine…)

    So, okay. We know there was direct communication between Hubbard and Key – Hubbard regaling that if JK had been in the country then the vultures wouldn’t have landed…he didn’t say that with no basis.

    Christian guy. Believes that a persons word is their bond ( whatever the words might have been) and operates on that premise. And then there was Johnny Boy. The smiling assassin.

    And the bad guys (insert your own names) are shielded from the pitchforks and torches by dint of the fact that ‘Father Christmas’ is being pushed to the fore as the guy who ‘done wrong’. The reality is that ‘Father Christmas’ failed. But he didn’t go and ‘done wrong’. ‘Father Christmas’ didn’t cynically take advantage of the situation. Neither did he lay the ground work that allowed for anyone to take advantage of the situation.

    Our government laid that groundwork. Johnny Boy and the cabal.

    I got petrol and hay. You got a pitchfork?

    catchpa arise ….. even the matrix knows!

    • Bob Stanforth 2.1

      I suggest you read a bit more widely, particularly the reports on SCF by Grant Thornton. Allocating funds to non existent organisations, and reporting $6M cash on hand when in fact there was $350K.

      Shonky, and why the SFO is still involved. “Our Government” have been left to pick up the pieces of a meltdown driven and fronted by one man who is now invisible – he might be in his 80’s, but he has enough strength to voice his vitriol and blame others. He has no one to blame but himself.

      And spouting crap about driving heartland investment whilst losing money on big city hotels and bars, whilst providing interest free loans to high risk farmers? Insanity.

      • Bill 2.1.1

        Yeah Bob.

        SCF was or is a dog. I get that.

        But the government isn’t so much ‘picking up the pieces’ as passing around ‘pieces of eight’ purloined from the public purse.

        Business people, seeing a business opportunity are seeing to it that returns can be maximised . Thing is, they are meant to be acting according to different standards; those of politicians entrusted with safeguarding and promoting what is good for society…not what is good for their mates’ back pockets.

    • Jum 2.2

      Captcha: adding

      The pitchfork of three prongs would have to be Jenny Shipley, Ruth Richardson and Don Brash who just happened to be down South mucking about in the muddy hay with ECAN behind closed doors.

  3. Bunnykinz 3

    Te Ururoa Flavell has a pretty interesting take on the situation:
    http://www.stuff.co.nz/national/politics/4087834/Different-treatment-claim-over-SCF-bailout
    can’t find the actual story on the Beacon’s website, so maybe it was only in the physical copy. Would be interested in ready it in it’s entirety though.

  4. Jenny 4

    Talk about cutting through the bullshit.

    Expert opinion from the Herald Business editor, that SCF should have been allowed to fail for the good of the country.

    Liam Dann:

    For most New Zealanders, only one question about South Canterbury Finance matters – why am I liable for this mess?

    ….the Government has handed over $1.7 billion of taxpayers’ money.

    We didn’t get a straight answer in April, and we’re not getting one now. But for that kind of money, we deserve one.

    John Key is sticking to his guns on the final cost to the taxpayer being $600 million after the assets are realised.
    That is pure spin. In three years of finance company failures, when have original projections for recovery ever been realised?

    ……

    As the final cost grows, it will come in dribs and drabs – an extra $23 million here, $60 million there and so on. Nothing too significant – unless you are a hospital or school board.

    Irish, I wouldn’t be at all surprised if Liam Dann’s job isn’t on the line for speaking so honestly in the columns of New Zealand’s most influential but editorially conservative daily journal. (Especially for his bon mot, accusing Key of “pure spin” ie. lying.)

    • pollywog 4.1

      Seems it has been decided, from on high, that for the good of the country and investor confidence, the SCF debacle is now not news.

      Can’t find a mention of anything on Stuff today so i guess that’s it ?

      Done deal, suck it up NZ, you just got shafted big time now move along, nothing to see here and woe betides anyone in the MSM who doesn’t toe the line.

      YAY… i can go back to my blissful ignorance now, safe in the knowledge that that nice man John Key and his trusty cohort Bill English have my best interests at heart.

    • Jum 4.2

      Yet where was the Herald and its hacks when we needed more in-depth objective reporting before and after the 2008 election. I’ve got no sympathy for Dann. I’m sure I remember him lauding Key’s nice-guy, moneytrader god appeal.

  5. Roadcone 5

    Same stuff different day!Once again, privatize profit, socialize lose. Happened in the after the Stockmarket crash of 84 and again during the Power distribution reorganisation under Bradford.

  6. John 6

    You’re 100% right Irishbill. Personally speaking National and Labour’s neo-liberalism and favouritism towards the rich has alienated me from New Zealand(It’s not my country) :Ordinary people are hoodwinked and their wishes ignored with contempt by the arrogant,conceited bastards we have for politicians.

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