There was an interesting article by Fran O’Sullivan in last weekend’s Herald about John Key’s ambitions for New Zealand. O’Sullivan may not be liked by some lefties but she writes perceptively and provides insight into National Party thinking that no other journalist does.
The headline suggests that Key wants to make New Zealand the Switzerland of the South but a closer reading shows that he does not want to make it a place where everyone is prosperous, educated and healthy. Rather he wants to make New Zealand a bolt hole for the overseas rich.
From the article:
John Key is positioning New Zealand as an Asia-Pacific “Switzerland” – a beautiful and wealthy bolthole for high net-worthers seeking to escape from an unstable world.
Key believes that free-flowing terrorism is here to stay. To the Prime Minister, this simply makes New Zealand more attractive and will result in more high net-worth consumers wanting to come here – a theme he is developing in business briefings.
There is another strand to this developing Key mantra.
He is frankly unapologetic about the massive increase in Auckland residential property values, which has resulted in many established Aucklanders becoming relatively rich, but younger people being locked out of the market. It is a trend which is not going to stop anytime soon, given the immigration figures.
So Key wants to attract more wealthy people to New Zealand as the rest of the world implodes. This explains his utter indifference to climate change and why he wants everyone to get some guts and make the Middle East even more unstable. They present business opportunities, not threats. As the centre of the world cooks and the north implodes from the pressure of millions seeking a new home, rich people flooding south to New Zealand’s green and pleasant land will make us richer, or at least those of us who already own land. As for the rest clearly they are poor and undeserving. Tough luck if you are young or working class or both.
O’Sullivan also discusses Key’s reticence to make overseas multinational corporations pay their fair share of tax and thinks that this is intentional.
One of Switzerland’s attractions is its taxation environment and its strict secrecy laws, which until recently have enabled rich people’s investments to be squirrelled away in its banks, safe from the reprisals of revenue officials.
New Zealand does not compete on that score. But it is notable that one of the reasons why New Zealand has yet to follow Australia and bring in rigorous laws to clamp down on multinationals which are not paying significant tax here is because this country is competing for investment.
The Key Government is proceeding at a very slow pace indeed, which is rattling New Zealand businessmen like Spark CEO Simon Moutter, who is adamant that it is unfair to local companies that they have to compete against offshore players who have a tax advantage.
This is undoubtedly a pressure point. There is a growing perception that New Zealand domiciled companies are getting an unfair shake while international investors are offered incentives or have the rules cut in their favour to invest here.
Obviously we need the money from those overseas corporations and not requiring them to pay tax is a small price to pay, at least as far as Key is concerned. He wants to attract this sort of investment, not scare it away. Forgoing $500 million a year is clearly a small price to pay.
More than any other article this one explains what John Key wants to achieve in politics. He is a bit of a laugh, he is fine about socially liberal things as long as they do not go too far, he is a monarchist but will propose a flag change to show that he is relaxed about the constitution. He is fun to have a beer with, he will welcome selfies with drag queens and support the occasional greenwash policy to make sure that his environmental credentials are not too badly tarnished.
But his role in politics is to look after the 1%.
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