Labour shoot themselves in the foot, again!

Written By: - Date published: 10:13 am, December 7th, 2013 - 247 comments
Categories: ACC, benefits, economy, employment, socialism, superannuation, tax, welfare, workers' rights - Tags:

Again! Just when you begin to think Labour are looking like a Government, one of the, “past their use by dates”, from the Rogernomics era, again! shows that they have NFI how to get elected and they are still clinging desperately to the Neo-liberal paradigm. .

Raising the age of super only makes sense if you accept the neo-liberal rights meme that transfer payments for welfare, including super, are solely a “cost”. As if transfer payments to the old simply disappear without trace, like tax cuts to the wealthy for Hawaii holidays.
If you accept that as a society we should no longer support those who are too old, young, ill or injured, to work.

It is a habit of right wing opponents of social wages to look at them in isolation, as a cost, just as they do with sick leave, as if the money disappears into a black hole.
You would think that those who take an accounting view of the world would understand a ledger has two sides.

Money transferred to the elderly, unlike the aforesaid tax cuts to the wealthy for Hawaii holidays, is paid to current workers to purchase goods and services for the elderly, adds to economic activity, increases the tax base, frees up the old to do volunteer, family, child rearing and community work, (with the long hours most people work now, it is the old who keep community services afloat), and decreases the economic and social costs to society, of poverty.

Too many people in mentally and/or physically demanding jobs, live in fear now. Fear that they will be left to the tender mercies of ACC, who seem to have narrowed the definition of an accident to exclude almost all work related injuries or illness, while accumulating huge surpluses, or WINZ, who define work capable as being able to move your eyebrow.
At least you are supported if you managed to stagger along until you are 65.

If nothing else Labour should consider, that a lot of the working class people at my work, have now decided, again, that Labour does not represent them.

On the other hand, you could say that universal super has been so successful in ensuring less than 3% of the elderly live in poverty, at a relatively cheap net cost to the economy, that, rather than reducing it, we should extend the concept to all ages. Beginning with children! (18 to 20% living in poverty)

247 comments on “Labour shoot themselves in the foot, again! ”

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  1. Paul 1
    7 December 2013 at 10:23 am

    George Carlin – The Real Owners Of America

    Make that New Zealand.
    Labour Party …owned by the neo-liberal corporations.
    The bit about super is in the third paragraph, but the whole quote from Carlin is on the nail.

    “The real owners are the big wealthy business interests that control things and make all the important decisions. Forget the politicians, they’re an irrelevancy. The politicians are put there to give you the idea that you have freedom of choice. You don’t. You have no choice. You have owners. They own you. They own everything. They own all the important land. They own and control the corporations. They’ve long since bought and paid for the Senate, the Congress, the statehouses, the city halls. They’ve got the judges in their back pockets. And they own all the big media companies, so that they control just about all of the news and information you hear. They’ve got you by the balls. They spend billions of dollars every year lobbying ­ lobbying to get what they want. Well, we know what they want; they want more for themselves and less for everybody else.”

    “But I’ll tell you what they don’t want. They don’t want a population of citizens capable of critical thinking. They don’t want well-informed, well-educated people capable of critical thinking. They’re not interested in that. That doesn’t help them. That’s against their interests. They don’t want people who are smart enough to sit around the kitchen table and figure out how badly they’re getting f***ed by a system that threw them overboard 30 f***ing years ago.

    “You know what they want? Obedient workers ­ people who are just smart enough to run the machines and do the paperwork but just dumb enough to passively accept all these increasingly shittier jobs with the lower pay, the longer hours, reduced benefits, the end of overtime and the vanishing pension that disappears the minute you go to collect it. And, now, they’re coming for your Social Security. They want your f***ing retirement money. They want it back, so they can give it to their criminal friends on Wall Street. And you know something? They’ll get it. They’ll get it all, sooner or later, because they own this place. It’s a big club, and you ain’t in it. You and I are not in the big club.”

    • Will@Welly 1.1
      7 December 2013 at 11:38 am

      Detroit declared bankruptcy, and guess what – all the retirees – pensioners lost their funds. Too bad, they had to live with that. The fact that money had been set aside, and they had budgeted to live on it in their old age, was immaterial. Years of neglect and mis-management has seen Detroit go down the gurgler, too bad, the city’s needs were more important, and hey what were the rights and welfare of a few old folk compared to that of the rich and the wealthy.

      • Descendant Of Sssmith 1.1.1
        7 December 2013 at 12:49 pm

        The Detroit bankruptcy boundaries somehow magically miss the affluent areas.

        http://ineteconomics.org/blog/institute/detroit-and-bankruptcy-america-s-social-contract

        Tis just another way of the banks and lawyers stealing what belongs to the people and removes democracy a la Gerry Brownlee with Ecan and Chch.

        A Republican Emergency manager can over-ride the wishes of elected representatives.

        http://www.equaltimes.org/in-depth/detroit-how-the-motor-city-was-driven-to-bankruptcy

        And of course all those wealthy private investors would love to get their hands on the art collections owned by Detroit galleries and museums.

        http://www.businessweek.com/news/2013-12-06/rivera-mural-at-detroit-museum-protected-from-bankruptcy-sale

        • alwyn 1.1.1.1
          7 December 2013 at 1:46 pm

          There is nothing magical at all about “missing the affluent areas”. There aren’t any affluent areas in Detroit at all. There are affluent areas in cities adjacent to Detroit but so what. Those cities didn’t offer unfunded pension rights to their employees and aren’t responsible for them.
          I happen to live in Wellington. One of the objections expressed by people who live in Lower Hutt and Upper Hutt to proposals for amalgamation is that they don’t see why they should become responsible for the large amounts borrowed by Wellington City. It is exactly the same argument as in Detroit.

          • Crunchtime 1.1.1.1.1
            10 December 2013 at 9:20 am

            alwyn, what you said about Detroit directly contradicts what Descendant Of Sssmith just said, and he gave links to back up his points.

            Detroit was divided up from being one greater metropolitan area into richer and poorer areas over the last 40 years.

            Unless you can cite some links that actually back up your points, the sensible thing to do is ignore you and take Descendant Of Sssmith’s well-cited post as far closer to the truth.

            • alwyn 1.1.1.1.1.1
              10 December 2013 at 2:11 pm

              I don’t accept that any of the links sssmith gave contradict what I said. To the best of my knowledge the area occupied by the City of Detroit has not changed at all. It has certainly not been divided up. The population has roughly halved but not the geographical boundaries.
              Of course there is a Metropolitan area that is bigger than the city. However there was never a single government, or in fact any government at all for this metropolitan area. Some of the surrounding cities, such as Birmingham, are very wealthy but it is a separate city. Perhaps these surrounding areas should take some interest in the city’s problems but the fact is that legally they don’t have to.
              In this respect it is little different to the situation in New York. There you have the city, with a population of about 8.3 million, and you have the contiguous Meropolitan Area with about 20 million and which includes cities in, not only New York State, but also New Jersey, Connecticut and Pennsylvania. The are different jurisdictions however and are not responsible for the City’s debts.
              I suggest that, instead of getting me to find references to show that something, ie the dividing up, never happened you might try and find any reference at all to this supposed sub-division. I don’t believe you can.
              I suggest that you look at the third point in this link.
              http://www.newrepublic.com/article/113954/detroits-bankruptcy-and-what-people-are-getting-wrong-about-it

      • alwyn 1.1.2
        7 December 2013 at 1:36 pm

        You say that “The fact that money had been set aside”. The problem was that the money had NOT been set aside. The city had promised the city employees large pension payments but had made no attempt to pay for them by putting money aside. Detroit, like most city and state goverments in the US have been pretending that their pension schemes were going to make enormous rates of return on the funds assets so that the money was never there to pay out on the promises.
        People may have believed the money had been set aside but it hadn’t been.
        If you think the Detroit is bad, wait till you see what is likely to happen to the state employee funds in California.

        • Draco T Bastard 1.1.2.1
          7 December 2013 at 2:54 pm

          The city had promised the city employees large pension payments but had made no attempt to pay for them by putting money aside.

          The city shouldn’t have had to because the city is part of the state and the state has sovereign money creation capabilities.

          Really, we need to be asking how a state can go bankrupt.

          • alwyn 1.1.2.1.1
            7 December 2013 at 3:15 pm

            I assume that by “state” here you mean the United States. It is a little ambiguous when talking about Detroit as Detroit is part of the “state” of Michigan.
            The United States does of course have sovereign money creation capabilities. Should it have the responsibility of honouring the financial commitments of every city, town, county or state in the United States without having total control over their actions? I certainly don’t think so. On the other hand I don’t see it as desirable that everything should be run from Washington and having, in effect, a single level of Government.
            It is a similar situation in New Zealand of course. Should we allow Len Brown in Auckland, to simply spend money on anything he desires, without hindrance, and leave the New Zealand Government to pick up the tab?
            One can also ask why we should stop with governmental services. Should the Crown, in New Zealand’s case, be responsible for the debts of everyone in the country? Can I borrow a million dollars, blow it, and then tell the person who loaned me the money to go along and collect it from the Crown as they can simply print the money?
            Your final comment is to ask how a state can go bankrupt. They can if they borrow in foreign currency denominated amounts when they don’t have the foreign money to repay the debt. Argentina did this when they borrowed in US dollars and then reneged on the loans. The do not have a power of sovereign money creation in someone elses money. They might describe it as abrogating the loan but it was bankruptcy all the same.

            • Draco T Bastard 1.1.2.1.1.1
              7 December 2013 at 4:00 pm

              Should it have the responsibility of honouring the financial commitments of every city, town, county or state in the United States without having total control over their actions?

              To some degree, yes because the state has responsibility to ensure that it’s people live in a reasonable living standard.

              On the other hand I don’t see it as desirable that everything should be run from Washington and having, in effect, a single level of Government.

              Neither do I. What I think should happen is that each US state and city within the US should be able to create money under strict rules set by the federal government.

              It is a similar situation in New Zealand of course. Should we allow Len Brown in Auckland, to simply spend money on anything he desires, without hindrance, and leave the New Zealand Government to pick up the tab?

              Of course not, there should be strict rules in regards to how much money that Auckland City (and other cities) can create.

              The point is that a country and city can never go bankrupt because they don’t borrow money at all. They have no need to and have never needed to.

        • Colonial Viper 1.1.2.2
          7 December 2013 at 2:58 pm

          alwyn.

          You are so full of shit. And clearly have no knowledge of what has happened.

          • alwyn 1.1.2.2.1
            7 December 2013 at 3:25 pm

            What an utter and unadulterated load of crap you are talking. What part of what I said is wrong?
            Try reading something simple on the subject, like the following, before you try and answer
            http://www.economist.com/news/united-states/21591189-where-detroit-has-gone-will-others-follow-those-pension-blues

            • Colonial Viper 1.1.2.2.1.1
              7 December 2013 at 4:15 pm

              The problem was that the money had NOT been set aside. The city had promised the city employees large pension payments but had made no attempt to pay for them by putting money aside.

              This comment of yours, you little shit. Show me where your Economist article addresses it.

              • Arfamo …
                7 December 2013 at 4:53 pm

                Every now and then one is amazed and enthralled by the robustness and passion evidenced in answers here.

                • Colonial Viper …
                  7 December 2013 at 5:07 pm

                  🙂 well, the political left nowadays tends to live in the bloodless, passionless language of intellectual abstraction, issues and policy prescription. Who can get excited about that shite? In fact, the liberal intellectual elite are not a substitute for a working class labour movement.

              • alwyn …
                7 December 2013 at 5:30 pm

                OK. I would comment at first that I am not claiming that NO money at all went into the pension funds. I do say that not enough went in to cover the obligations and that the assumptions as to the future returns on the assets of the funds were much overstated. The funds are not sufficient to meet the obligations, in Detroit to the extent of $3.5 billion.
                This is a significant part of the total Detroit debt of $18 billion, even if the Detroit pension funds are as well or better funded than many other cities.
                The funds assume that they will make 8% on their assets. That simply hasn’t happened in this century in the US and some experts argue a rate of 4% is the appropriate one.
                Anyway
                http://www.newsmax.com/Newsfront/city-pension-shortfall-underfunded/2013/11/11/id/536027
                http://dealbook.nytimes.com/2013/09/25/undisclosed-payments-cost-detroit-pension-plan-billions/?_r=0
                http://www.cnbc.com/id/100929269
                all have some more on this.

                • Will@Welly …
                  7 December 2013 at 6:23 pm

                  Those administering the bankruptcy admitted that they were essentially “robbing” the funds of retirees simply because they could. They will use those funds to help get Detroit out of administration within 2 – 3 years time, but from now on in, and after that, what are those retirees supposed to live on – the answer is clear – food stamps. Key & co will love this idea – pick-pocketing out of the old, the infirm, and the frail.

                  • alwyn …
                    7 December 2013 at 6:48 pm

                    Hey look. I’m not in favour of what is going on. I am retired myself and I know darn well that you can’t recover from losing your only source of income. I have enormous sympathy with the people who have been burnt.
                    I do not believe, on the other hand, that John Key will love pick-pocketing the old, the infirm and the frail.
                    There is no evidence at all for such statements.
                    The problem with the retirement funds, and it applies to almost any defined benefit fund, is that the do not get fully funded and unrealistic assumptions are made for the returns on the assets.
                    It isn’t the administrators of the bankruptcy who are doing the things you suggest. The trustees of the fund, as you will see in the nytimes article were disposing of the money if they had a good year and ignoring the problem if it was a bad one.

                    • Rogue Trooper …
                      7 December 2013 at 7:20 pm

                      spending some of your retirement days well then, continuing to learn, then debating those findings.

                    • Murray Olsen …
                      7 December 2013 at 10:36 pm

                      The crap going on at ACC, where almost anything gets described as a degenerative condition, cannot reasonably be described as anything but pickpocketing the infirm and the frail. I agree with CV. Your contributions are a load of crap.

    • dave 1.2
      7 December 2013 at 9:40 pm

      baby boomers are leaveing nothing for the next generation the country is being asset stripped the boomers are stealing our retirement with there selfish greed there has to be some intergenerational justice ,why the hell should we pay the dept the boomers run up and not get the same benifits ourselves there needs to be justice for the generations that come after the boomers they have got to help recapitalise suprtanuation . boomers got the cheap homes super plans free education stable jobs generation x got the neo liberal economic F -up! not fare not right THERE HAS TO BE JUSTICE ,

      • Foreign Waka 1.2.1
        8 December 2013 at 3:55 pm

        Dave, do you think that those people who are about to retire are “well off”? Please, before you make such angry public statement, get the facts and investigate. Besides, if there are people of retirement age who are NOT on the poverty line or below, that is good news. Some made it! Hurray, there is some hope. You seem to forget that these people have worked all their lives to get there. How dare you demand that they hand over any of their savings! The majority has started with nothing, meaning NOTHING and have worked all their lives.
        The very rich have NEVER contributed to the system in the first place, they always knew how not to pay tax.
        If you refer to political leaders, yes there is an unjust element regarding free everything to them and their partners, wage increase that make ones eyes water etc.
        The baby boomers had to content with the likes of Mr Douglas “the Judas of the Labor party” who must have had relations to Mrs Thatcher or Mr Ruth Richardson with her “Mother of all budgets” that did cut benefits to subsidence level or the retention of a surtax on pension payments. (A tax on a tax on a tax). Interesting though that even with a generational shift in Parliament, things now get worse. The likes of Mrs Bennett take it all away or Mr Brownlee sit on your hands or Mr Bridges I have a cunning plan, NZ seem to breed them somewhere.
        So if you really want to change something, stop trampling on those who are standing in the line next to you.

      • greywarbler 1.2.2
        8 December 2013 at 4:07 pm

        dave
        I’m so sorry that the dastardly baby boomers have run off with your everything even the essentials like your full stops. And time. You need more time to think out your suggestions in a balanced way and then edit them, not dump and run.

        How can we get shot of this awful mess of selfish greed. That’s what we are thinking about and getting strategies that have to be explained to others. So they have to make sense.

        Recently some guy wrote in and said the workers should be asked what they want. If you are a ‘worker’ then what would be a good way to get back to a country for all people? State your ideas don’t just get angry. Like before the new libs started whisking everything away while they found a bunny in a cheap imported hat to hypnotise us so we would forget that we used to do work and make wages that provided for everything with some time off, and all that was prized by fellow citizens.

    • dave 1.3
      8 December 2013 at 7:38 am

      the debate we need to have if national hadnt cut kirks scheme we wouldnt have this problem if national hadnt derail peters in 1997 we wouldnt have such a problem ,if national hadnt stopped controbutions to the cullen fund we have had something if national hadnt sold the assets if short national its backers and voters have looted this country for decades and those pricks should be made to pay i totally support cunliffe going after the unpaid taxes because they stole our future. We knew about the boomers bubble they looted stole and plundered well i think they should reap the backlash at full force

      • karol 1.3.1
        8 December 2013 at 8:06 am

        Yes, it was the righties. Many of us boomers fought it all the way. And many of the generations younger than boomers have continued with the asset stripping.

        Yes. things were easier for us boomers when we were young – and things are much tougher for the young these days. And we need to continue campaigning to make life easier for all young people, so they have better future lives.

        But it is incorrect to say we were all “greedy” and “selfish”. Those (upper working class and middle class) boomers that did buy property, etc, (and not all of us did -plenty could not afford to) did just what many younger people are trying to do – what they are told they should do for a secure future and so as not to be so dependent on the state.

        Some boomers, also some younger people, got into the whole greedy property speculation thing. But most just bought a house for themselves and family.

        Most boomers did not go to Uni – they couldn’t afford to keep themselves while studying – it was the fees that were “free”, but they still had to live.

        But we aren’t all property owning well off asset strippers.

        The blame is with the well-off, the wealthy and powerful of all generations, that try to keep their power and advantages. Wreaking vengeance on boomers will not solve this problem for future generations – there will be plenty of selfish younger people trying to keep the system working in their favour. Some are already at it – the likes of Simon Bridges, Paula Bennett, Colin Craig, Matthew Hooton…. they just keep on coming!

    • phillip ure 1.4
      8 December 2013 at 5:15 pm

      how about dropping the pension back to 60…

      ..means-tested until age 67…?

      ..how would that not be an absolute winner..?

      ..has that been costed..?

      ..it would also free up many more jobs for the unemployed young…

      (..has job-sharing been seriously considered..?..businesses open for 60 hrs per wk..

      ..with two workers doing 30 hrs each..

      ..how is that not a winner/vote-catcher..?)

      ..is there one iota of fucken original/different to neo-lib paradigm thinking/ideas coming out of labour..?

      ..i ain’t seeing it..

      ..phillip ure..

      • greywarbler 1.4.1
        8 December 2013 at 5:21 pm

        Phillip
        Sounds good – job sharing longer hours open. Could be a winner.

        • phillip ure 1.4.1.1
          8 December 2013 at 5:41 pm

          chrs..re the pension idea..(further thoughts)..

          ..u cd expand both ways..

          ..the option of a (means-tested) pension @ 60 wd appeal to many..(especially earlier dying maori/pi..)..and would get many of those disempowered 800,000+ who didn’t vote last time..

          ..into the ballot-box..and voting for labour..

          ..and part of the costs for this could be covered by extending that means-testing for the pension to age 70..

          ..with universality kicking in then..

          ..how about costing that..?

          ..phillip ure..

          • phillip ure 1.4.1.1.1
            8 December 2013 at 5:54 pm

            a further benefit of the job-splitting idea..

            ..is that families/parents would ..if they chose..be able to arrange their working lives so that one of them is there most times..

            ..therebye doing away with the costs/needs/subsidies for.. childcare..

            ..how is that not a winner..for all concerned..?

            ..especially the children/a civilised family/work-life-mix..?

            ..phillip ure..

  2. Morrissey 2
    7 December 2013 at 10:27 am

    Labour shoots themselves [sic] in the foot

    This is a very good article, but it would carry a lot more authority if the headline was not so illiterate. Who is responsible for that headline? Some halfwit from ACT?

    • Colonial Viper 2.1
      7 December 2013 at 10:30 am

      what’s the mistake? Themselves vs themself?

      • Morrissey 2.1.1
        7 December 2013 at 10:43 am

        Jesus H. Christ, Viper: are you SERIOUS?

        Assuming you are genuine, here is the way that headline should be written: Labour shoots itself in the foot, again!

        • Ake ake ake 2.1.1.1
          7 December 2013 at 10:49 am

          Or Labour shoot themselves .. where the plural possessive pronoun is used with Labour being taken as comprising multiple entities or parts of a group.

          • Morrissey 2.1.1.1.1
            7 December 2013 at 10:54 am

            Wrong. There is only one acceptable verb in this case. I make the same mistake as everyone else, when I’m talking—but print demands a higher standard.

            • Ake ake ake 2.1.1.1.1.1
              7 December 2013 at 11:02 am

              “There is only one acceptable verb” – not necessarily so.

              I should not have deleted my earlier comment where I said something along the lines of ……

              Where a group word like ‘Labour’ or, for example, ‘a committee’, can be read as comprising multiple entities or units (broad church?), or if the group may have a range of views and not hold just a single view, or may have members who act as individuals (consider Shane WTF Jones), then the plural possessive pronoun can be used.

        • Colonial Viper 2.1.1.2
          7 December 2013 at 1:21 pm

          Heh I stand corrected. Thanks.

          • red blooded 2.1.1.2.1
            7 December 2013 at 3:01 pm

            Hmmm… The problem isn’t the choice of pronoun, though (either would be fine), it’s the lack of agreement between pronoun (in this case, plural) and verb form (in this case, singular). Either Labour shootS ITSELF in the foot or Labour SHOOT THEMSELVES in the aforementioned body part.

            Pedantic, yes, but if you are going to comment on syntax, AAA, then you need to look at the whole sentence.

            • KJT 2.1.1.2.1.1
              7 December 2013 at 3:16 pm

              You are correct. Shoot!

              An oversight, as I was rather angry when I wrote this.

              • Arfamo …
                7 December 2013 at 4:55 pm

                I feel your pain as it grieves me acutely also. They don’t just shoot themselves in the foot they also look down the barrel and pull the trigger at the same time to see if there’s another round there.

                • Descendant Of Sssmith …
                  7 December 2013 at 6:19 pm

                  On the other hand I would argue that the approach is entirely consistent with their pale blueness.

                  The easy test for me as to whether there is any real change to to correct the failure of Clark’s government(s) to put the $20-00 per week back on benefits – reminder they took they more expensive option of already putting it back on the already higher NZS.

                  Unless they do that my vote will be going to Mana for the first time.

                  I’m also highly peeved they claim the 8 hour working day on their website as a Labour achievement when not a single Labour MP believes in that today. Hypocrites the effin’ lot of them.

                  • Rogue Trooper …
                    7 December 2013 at 7:23 pm

                    That is an excellent proposal, I concur Sir / Madam; just said today “I wish they’d put the benefits up”; which would only, achshully, be a recovery. Would be a vote-winner 😀 😀 :-D. Buy!

                    • Descendant Of Sssmith …
                      7 December 2013 at 8:06 pm

                      Remembering too that those under 25 lost more than anyone else by the introduction of an under 25 rate.

                      The adult rate used to start at 18. Fix that as well.

                    • Rogue Trooper …
                      7 December 2013 at 9:01 pm

                      you’re clever DOS. 😀

            • Colonial Viper 2.1.1.2.1.2
              7 December 2013 at 5:04 pm

              OK I re-stand, re-corrected.

        • Crunchtime 2.1.1.3
          10 December 2013 at 9:38 am

          Morrissey is absolutely correct. Is it possible to change the title? The current title is giving me a headache.

  3. Colonial Viper 3
    7 December 2013 at 10:28 am

    Thank you for writing this KJT. I back your comments 100%.

    A universal, unconditional income scheme could also be supplemented with a full employment programme for those 25 years and under.

    How can the nation pay for it? Through taxes and, if required, government money creation. As you imply, most of the $1000 paid out in super will eventually get taxed back into Treasury. Super is not a “cost” where money just vanishes into smoke; what is a cost for the government is INCOME for communities.

    The government and private sector then have to work closely together to ensure that the real economy is competitive and productive enough to deliver real goods and services to people and to communities, in exchange for the money supplied.

    This is what economics should be about.

  4. tricledrown 4
    7 December 2013 at 10:28 am

    If kiwisaver is made compulsory
    and the age of universal pension is raised it would be a non event because the age raise would be a transfer point to kiwisaver funded retirement at 65.
    Good way to push for compulsory kiwisaver!

    • Colonial Viper 4.1
      7 December 2013 at 10:35 am

      Uh, giving even more workers’ money to the private financial management sector, for them to invest in the gamed capitalist financial markets (casinos) is, excuse my language, fucking stupid.

      • KJT 4.1.1
        7 December 2013 at 6:01 pm

        “The next generation of workers ‘always’ pays for those that retire.
        They can pay directly through taxation. The most efficient and cheapest method.
        Or.
        If retirees save by buying houses, workers pay through their rents.
        If retirees save in banks, workers pay with their mortgage repayments.
        If retirees save by buying power companies, workers pay through their power bills.
        If retirees save by buying a business, workers pay for the profits required.”

        OR. We can save by building the capability of New Zealand, and future generations to support all of us. By paying more tax now for;
        Cheaper housing for young people.
        Sustainable infrastructure.
        Productive, and socially and environmentally sustainable business.
        Building up National assets. (The opposite of asset sales).
        Education, training and job creation for young people.

        Don’t forget that young people eventually become too old or sick to work, also.

        The alternative, is, of course, going back to leaving a large number of elderly in poverty.
        Something that the current super has solved.

        Do we want that?

        • Draco T Bastard 4.1.1.1
          7 December 2013 at 6:14 pm

          OR. We can save by building the capability of New Zealand, and future generations to support all of us.

          QFT

  5. Ake ake ake 5
    7 December 2013 at 10:29 am

    “If nothing else Labour should consider, that a lot of the working class people at my work, have now decided, again, that Labour does not represent them.”

    As was pointed out, conference voted to give caucus the discretion to decide on the retirement age. And as has been commented: “like that worked so well last time.”

    Yes, agree that it appears the Labour caucus remains out of touch with the working people.

    I thought Cunliffe was meant to bring some new thinking and new approach. He said there is a new train leaving the station and he wanted everybody on it.

    Looks like TARA got left behind. He needs to pause the train and send someone to get TARA, and that someone obviously will not be David Parker.

    • greywarbler 5.1
      7 December 2013 at 11:10 am

      Ake x3
      TARA acronyms make communication difficult sometimes. What is it? Please advise, I’m naive and innocent about this.

      I thought I’d look up on google – this one from India is worth noting in New Zilland.
      Television Aimed at Regional Audiences (India)

      • Ake ake ake 5.1.1
        7 December 2013 at 11:13 am

        TARA = There Are Real Alternatives

        TINA = There Is No Alternative

        • Ake ake ake 5.1.1.1
          7 December 2013 at 11:32 am

          Make no mistake that I would like to see Cunliffe succeed as he is the one around at this stage who most clearly has the mind and heart to lead and govern for all, not just the select few, and to bring about meaningful change now as well as for the country’s long term interest.

          It is understandable that Cunliffe has to operate with some neo-lib baggage still in tow and it would not be realistic to demand he kick off the TINAS within a few months of being in leadership.

          Having said that, it was disappointing this week to hear TINA speak – unqualified, unmodified (from the 2011 general election) and unrestrained – and even more disappointing to fail to get a sense at all that TARA is on board.

          • Ake ake ake 5.1.1.1.1
            7 December 2013 at 11:47 am

            edit
            TINAS should be TINAs

            • Colonial Viper 5.1.1.1.1.1
              7 December 2013 at 12:19 pm

              And for a more historical context

              There is no alternative (shortened as TINA) was a slogan often used by the Conservative British Prime Minister Margaret Thatcher. In economics, politics, and political economy, it has come to mean that “there is no alternative” to economic liberalism—that free markets, free trade, and capitalist globalization are the best or the only way for modern societies to develop.

              http://en.wikipedia.org/wiki/There_is_no_alternative

          • weka 5.1.1.1.2
            7 December 2013 at 6:07 pm

            Thanks Ake. Can someone explain how this process worked in Labour? eg would the whole caucus have voted on this? Would they have talked to anyone outside the caucus first, or is this just an endorsement of the pre-Cunliffe policy?

        • alwyn 5.1.1.2
          7 December 2013 at 1:54 pm

          Darn. I thought you were talking about that great old film “Gone with the Wind” with its finishing line of “Tara! Home. I’ll go home”
          And also about Tina Turner.
          Your translations are so much duller than my imagining.

        • swordfish 5.1.1.3
          7 December 2013 at 7:36 pm

          @ “TARA = There are Real Alternatives”

          Funny, because whenever I read this acronym on THE STANDARD, like Greywarbler I’ve always assumed it meant – Television Aimed at Regional Audiences (India). I stand corrected.

          • greywarbler 5.1.1.3.1
            7 December 2013 at 11:19 pm

            swordfish
            You may have thought that about Tara but I didn’t know till recently.
            Are you one of those clever guys that appear in circuses swallowing a sword and breathing flames in a very exhibitionist way? I think we can do with a bit of excitement and and joie de vivre here. What’s for your next performance?

            • swordfish 5.1.1.3.1.1
              8 December 2013 at 3:21 pm

              “Are you one of those clever guys that appear in circuses swallowing a sword and breathing flames in a very exhibitionist way ?”

              Why, yes I am.

  6. Rosie 6
    7 December 2013 at 10:49 am

    Thanks KJT. Indeed this a major turnoff and I now have cold feet about voting Labour at the next election. I had finally, after much thought, decided to return to Labour as a voter after Cunliffe was voted in as leader. I was even a bit excited about our future under a Labour Greens govt. Now I’m apprehensive. Are we losing momentum again? Are they looking less credible as a challenge to this stink govt we have now?

    I also have missed the talk about the threat of raising GST to 17% – was that the alternative if we didn’t raise the age of retirement to 67? If so I am horrified and worried. They need to UNDO their past mistakes, such as GST, not entrench them further!!!

    • Ake ake ake 6.1
      7 December 2013 at 11:39 am

      Hi Rosie

      “Are we losing momentum again?”

      The only most charitable thing I can think of saying is Cunliffe is so very strategic that he has opened up space for Winston Peters (and possibly the Greens or Mana?) to campaign differently. And so any coalition or confidence/supply agreement with others will involve a refinement of this proposed policy.

    • Colonial Viper 6.2
      7 December 2013 at 12:21 pm

      It’s crucial that a movement of people, ones who support the Left, applies mass pressure to every political party to do the right thing.

      • Ake ake ake 6.2.1
        7 December 2013 at 1:29 pm

        Indeed.

        If Cunliffe and Labour keep shooting themselves in the foot, it would be a lot more painful for them if their supporters hold their feet to the fire.

    • Draco T Bastard 6.3
      7 December 2013 at 3:09 pm

      Are they looking less credible as a challenge to this stink govt we have now?

      The problem is that they’re not challenging the economic orthodoxy that just produced the biggest financial meltdown since the Great Depression and is causing massive poverty and unemployment. Nothing Labour has said changes how things are and that is what will stop them being in government next year.

      More and more people realise that we need to change the system because it just isn’t working, that we need to stop rewarding the rich for being rich and start to be a community again.

    • KJT 6.4
      7 December 2013 at 8:24 pm

      It was a threat from Parker etc, That if we did not raise the supper age we would have to raise GST to 17%.

      No mention of other alternatives like raising top progressive tax rates, increasing the tax base with options such as CGT, wealth taxes, and/or FTT, increasing incomes at the lower end to expand the economy or taking back the share of GDP that workers enjoyed in the past. (Now 40% and heading down. https://unitenews.wordpress.com/tag/workers-share-of-gdp/).

      GST is a strongly regressive tax which impacts disproportionately on those who have to spend all their income. Nationals cuts in the top tax rate and increase in GST was a cynical redistribution of income and resources, to the wealthy.

      “Once you realize that trickle-down economics does not work, you will see the excessive tax cuts for the rich as what they are — a simple upward redistribution of income, rather than a way to make us all richer, as we were told.” Ha-Joon Chang. (Faculty of Economics. University of Cambridge).

      • Draco T Bastard 6.4.1
        7 December 2013 at 9:29 pm

        And I really must get round to reading Ha-Joon Chang’s book: 23 Thing They Don’t Tell You About Capitalism

      • Rosie 6.4.2
        8 December 2013 at 10:59 am

        Thanks KJT (and CV, Ake Ake Ake and Drax) I agree with and understand your points on GST – This is what I was worried about.

      • phillip ure 6.4.3
        8 December 2013 at 5:01 pm

        and don’t forget the financial transaction tax (hone heke tax) on the banksters..

        ..remember how treasury analysis showed a small tax on inter bank/financial institutions..

        ..would raise enough revenue to do away with gst altogether..

        ..should we choose to use the revenue that way..

        ..i am actually puzzled as to why parker is not getting this idea out there now..

        ..instead we get this worker-bashing/vote-killing/t.i.n.a./raise gst even more threat bullshit from him/labour..

        ..w.t.f. is he/are they smoking..?

        ..phillip ure..

  7. Steve Wrathall 7
    7 December 2013 at 10:56 am

    So transferring purchasing power from one individual to another “adds to economic activity”. Great! Pass a law that they have to transfer it back, rince, repeat, & watch the economy boom

    • greywarbler 7.1
      7 December 2013 at 11:39 am

      Stev W
      That is already done as I understand it with wealthy financial entities like fay rich and white or the like as illustrated in the winebox enquiry. Transferring one piece of money around to different related entities, each taking a management fee, until finally the remainder is presented for taxation purposes, the carrot top, and the rest eaten up by legal erosion.

    • KJT 7.2
      7 December 2013 at 8:25 pm

      Of course.

      ALL economic activity is transfers of money, by definition.

      Remember the boarded up shops in Northland after Ruthanasia.

      Some transfers, like giving tax cuts tax those who spend it of offshore, lose it in financial gambling and pushing up housing prices, subtract from economic activity.
      Transferring it to those with little, who spend it within New Zealand, add to economic activity. And local prosperity.

  8. Bill 8
    7 December 2013 at 11:17 am

    I might be wrong, but wasn’t that bullshit – of raising the retirement age – passed at conference? And wasn’t it the case that some party members considered the fact that because the wording became merely slightly less explicit, that some sort of victory had been achieved? And isn’t it the responsibility of members to be slightly batter than complete fcking idiots and tell caucus that ‘no means no’ on any given policy suggestion and be very fcking clear about it…leave no wriggle room or loop holes? And didn’t the membership completely fuck up on that front at conference?

    And – not checking – but pretty sure many people on this blog (authors and commentators) lauded the ‘responsible’ suggestion when it was mooted around the time of the last election.

    So yeah, maybe Labour will be a part of the next government. And they will have to treat super like the Nats treated privatisation…and probably wind up fucked as a result.

    • Colonial Viper 8.1
      7 December 2013 at 12:24 pm

      Well, I spoke up against the raising of the retirement age. I said that 45 years of working for the Man, was more than enough for any man or any woman. And where were the jobs anyway, to keep increasing the size of the labour pool?

      But the majority of party members there, not unlike sheep, decided to give caucus the leeway to increase the retirement age as was deemed necessary.

      And IIRC most of the affiliate unions voted for that to.

      • Bill 8.1.1
        7 December 2013 at 3:07 pm

        I’ve no doubt you spoke against it CV. I guess I’m just pointing out that a fair few around here have either flip flopped or are being awfully silent. That and the utter naivety of folks who think that because something ‘sounds better’ it means that the implicit bad shit has somehow been abandoned.

        As for the position of unions – I dunno – fucking fucked is what that is.

  9. captain hook 9
    7 December 2013 at 11:19 am

    of course transfer payments add to economic activity.
    ask the shopkeepers who depend on beneficiaries for their income!

  10. chris73 10
    7 December 2013 at 12:12 pm

    I personally like the idea of a combination of means testing and P. Dunnes super between 60 – 70

    • Naturesong 10.1
      7 December 2013 at 1:21 pm

      No, means testing is the initial step needed to present the following political argument: “lazy old people that didn’t save for their retirement and are now bludging on the rest of us.”

      That argument has been won already, and historical data shows universal super works – on mob so havent got refs but can google later if anyone calls me on it (or you could google it yourself)

      For labour to choose to relitigate this again at a later date because they changed it to a means test would be shooting themselves in the foot.

      Means testing would probably be ok, if we knew it was not going to be used as a wedge to drive down the payments to the remaining elderly at a later date.

      • Colonial Viper 10.1.1
        7 December 2013 at 1:25 pm

        Means testing is fine for conditional super available @ 63 years of age, then unconditional super @ 65 years of age 😉

        • Naturesong 10.1.1.1
          7 December 2013 at 1:34 pm

          Any means testing will be used as a wedge to divide the “deserving” and “undeserving”.

          You know this to be true.

          • alwyn 10.1.1.1.1
            7 December 2013 at 2:03 pm

            The battle over means testing was fought long ago, and came down hard on the side of not doing it. It is a guaranteed vote loser.
            My mother had voted Labour for nearly 60 years. Then the Lange Government , by means of the special tax rates, in effect means-tested her National Super away. In her view “They had stolen her pension”. She lived about another 15 years, into her mid-nineties and never voted Labour again. A large number of people would do exactly the same.

    • KJT 10.2
      7 December 2013 at 3:32 pm

      Means testing is open to a great many opportunities for unfairness and accounting fiddles.

      I favour the principle of universality for most, if not all social wages.
      It removes the incentives for the wealthy to get rid of welfare.
      It treats everyone the same.
      It cannot be played with by agencies or Governments with notions or deserving/undeserving.
      It gives people certainty.

      Progressive taxation both pays for super and offsets the payment to those who do not need it.

      • Descendant Of Sssmith 10.2.1
        7 December 2013 at 6:09 pm

        Aye. I’m simply saying that means testing is better than increasing the age and if we have to do something then it’s a better option.

        I’d rather we collected more tax to pay for it. The wealthy have not just benefited from lower general taxation and higher wages – they have benefited from the removal of sales taxes, death duties, LAQC’s, gifting changes, trust establishment, the extension of accommodation assistance to those not on benefit and so on.

        All those things reduced revenue to the crown disproportionately to the benefit of the well-off.

        • Draco T Bastard 10.2.1.1
          7 December 2013 at 6:16 pm

          +1

        • Colonial Viper 10.2.1.2
          7 December 2013 at 6:17 pm

          We can collect more tax to pay for super, or we can just have the Reserve Bank credit the Cullen fund with an additional $20m per week. Which solves the problem for 100 years.

          This is not hard, if we decide that this is important enough to society to adopt new economic thinking.

          • Draco T Bastard 10.2.1.2.1
            7 December 2013 at 6:21 pm

            We can collect more tax to pay for super, or we can just have the Reserve Bank credit the Cullen fund with an additional $20m per week. Which solves the problem for 100 years.

            No it won’t. All it will do is ensure that the Cullen Fund has a large balance of cash when what we need to do is to build up* our economy so that the goods and services required can be supplied. That is going to mean a lot more automation in places like supermarkets (although, I actually think supermarkets need to be removed as they’re inefficient).

            Forget the Cullen Fund, go to direct government investment in R&D.

            * Build up here specifically means getting our economy doing more stuff rather than the normal BS which means doing more of the same stuff.

      • Francis 10.2.2
        8 December 2013 at 10:57 pm

        For a gap between, say, 60 and 67 (or 65), why means test on wealth? That’s open to a very wide range of manipulation.

        It would make more sense for retirement to be tested on physical (and mental) health. If someone is unable to work, then they would be eligible for the pension earlier than most people. Eligibility could automatically be given to those on a reasonably long-term sickness benifit, and be available to those who meet some sort of criteria.

        Of course, even that could be open to manipulation, but it would be better than nothing at least. And it would make more sense than financial well-being.

  11. red rattler 11
    7 December 2013 at 12:27 pm

    Who needs ACT in govt when Labour stands to punish workers with its pensions plan?
    Not only bad social democracy, but hostage to the bosses making workers pay for their crisis. Proof that ascension of Cunliffe is mood music.
    http://redrave.blogspot.co.nz/2011/10/aotearoa-labour-party-adopts-act-policy.html

    • Ake ake ake 11.1
      7 December 2013 at 12:55 pm

      Thanks. I see that was posted on 29 Oct 2011.

      People should speak or write directly to Cunliffe, cc Parker and the rest of caucus, as well as post on blogs and on Cunliffe’s Facebook page, to ask what is new and different about Cunliffe’s leadership on this issue.

      Politicians may not read blogs but I noticed Cunliffe previously posted on The Standard in the run-up to the leadership selection. Perhaps, at the moment, he would like to explain or provide his comment on the latest policy announcement? It would be nice to see Cunliffe here again.

      If he is too busy right now, I really hope he and his team are working hard on a nice loud and clear media event for the coming week, just before the country switches off and goes on holiday mode. He did very well with the media event in his electoral office when announcing he was contesting for the leadership, and he was excellent with the media, riding on the momentum after successfully winning the leadership. He can surely do it once more.

  12. Te Reo Putake 12
    7 December 2013 at 12:44 pm

    Gotta say, this is an excellent proposal from Labour.

    The discussion has to be had and the soft approach of a means tested super between 65 and 67 is probably going to be a vote winner. It doesn’t stop workers with a low asset base getting super at 65, which stays true to Labour principles, but pushes middle class eligibility out by only 2 years, which is going to be acceptable to most voters.

    Britain, of course, is proposing a 5 year lift to 70, so this is a relatively small change in comparison. And it leaves little room for the Tories to maneuvre, so, again, so good politics from Team Cunliffe.

    • Saarbo 12.1
      7 December 2013 at 1:01 pm

      “The discussion has to be had and the soft approach of a means tested super between 65 and 67 is probably going to be a vote winner”

      Why do you reckon this will be a vote winner TRP? I would imagine if national announced a hard line alternative then Labour’s stance may be a vote winner but otherwise I cant see too many people actually switching from National to Labour based on this policy. But you probably know more about these things than I do.

    • Colonial Viper 12.2
      7 December 2013 at 1:13 pm

      The discussion has to be had

      Why?

      but pushes middle class eligibility out by only 2 years, which is going to be acceptable to most voters.

      Where are the additional jobs coming from, to deal with an increased labour pool?

      Britain, of course, is proposing a 5 year lift to 70, so this is a relatively small change in comparison.

      So this proposal is less Tory than the UK Tories are proposing? That’s a “vote winner” then? From whom? Is it going to being into the fold the 800,000 who didn’t vote last time?

      • Lanthanide 12.2.1
        7 December 2013 at 2:43 pm

        “The discussion has to be had

        Why?”

        In suggesting that we do not need a discussion on affordability of superannuation, you’re even worse than John Key.

        • Colonial Viper 12.2.1.1
          7 December 2013 at 3:00 pm

          Why is it not affordable? Last I looked NZ had a few hundred billion NZD already issued, let alone the capital value of assets in this country.

          Issue another $20M per week to the Cullen fund and the problem goes away for 100 years.

          • Lanthanide 12.2.1.1.1
            7 December 2013 at 9:31 pm

            And yet apparently you don’t think it’s even worth discussing that. Strange, since you seem to discuss it so often.

            • Colonial Viper 12.2.1.1.1.1
              8 December 2013 at 8:07 am

              Fair point. But let’s please have some imaginative options on the table which help to shape the whole of society for the better; not just options which respond to Treasury deficit projections.

        • Draco T Bastard 12.2.1.2
          7 December 2013 at 3:35 pm

          Being able to afford something has nothing to do with money. It has to do with being able to supply the goods and services that our population require and those things only become unaffordable when we restrict our economy to farming rather than allowing it to expand to encompass all that we require.

          • Colonial Viper 12.2.1.2.1
            7 December 2013 at 6:19 pm

            thank grod someone else gets it, cheers DTB. Arithmetic add/subtract operations on electronic accounts are trivial. It’s the creation of an economy which can deliver which is the real challenge.

            We need new economic thinking.

        • Arfamo 12.2.1.3
          7 December 2013 at 5:11 pm

          you’re even worse than John Key

          That is such a disgraceful allegation to make of anybody that had you made it 100 years ago I would have been offering to be his second while you chose the weapons.

          • Colonial Viper 12.2.1.3.1
            7 December 2013 at 6:19 pm

            just classic!

          • Lanthanide 12.2.1.3.2
            7 December 2013 at 9:32 pm

            Yes, I did hesitate as to whether it was really appropriate to insult someone like that. But I decided it was so true that I had to say it.

            Key is open to a discussion on super, his answer is always “we aren’t changing it”. CV thinks we shouldn’t even talk about it.

            • Colonial Viper 12.2.1.3.2.1
              7 December 2013 at 11:41 pm

              Well if we are going to talk about it, let’s do it seriously. Not in terms of “shall we increase the age of super.” But: “we are going to have a lot more older people in NZ in the next few decades. What do we need to do to get ready for that?”

              But you know. Whateva.

    • Ake ake ake 12.3
      7 December 2013 at 1:15 pm

      “Britain, of course, is proposing a 5 year lift to 70, so this is a relatively small change in comparison.”

      Is that the British Tory, blue, government proposing the age increase?

      It wasn’t so long ago when I thought I heard from a certain NZ Labour Party leadership candidate who went on to win the leadership selection that there will be no paler shade of blue under his leadership. As media reported, he said:

      “Workers, where National is telling them they want to cut them off at the knees, don’t want to hear from us that we would too – just nearer the ankles with more anaesthetic.”

      Interestingly, National does not appear to have said anything about cutting workers at their knees by raising the super age.

      And btw, to KJT:
      putting aside any likely announcement by Labour about the anaesthetic to be applied,
      if workers get cut off at the ankles by Labour,
      workers will no longer have a foot at which to shoot.

    • Rogue Trooper 12.4
      7 December 2013 at 1:38 pm

      +1 TRP; been eating your greens? 😉

      • greywarbler 12.4.1
        7 December 2013 at 2:51 pm

        Why do we judge policies mainly by what other countries are doing? Britain is going to 70. Margaret Thatcher is holding nightly meetings at her graveside. What is that to do with us. We don’t need Brit voodoo economics, the lame response of the Living Dead.

        We do need to watch what they are doing while we are thinking of our own bespoke policies made to fit our dairy-fattened figures. Go figure. We do things, we think things, therefore we are something. A country that can think FOR ITSELF.

      • Te Reo Putake 12.4.2
        7 December 2013 at 3:39 pm

        Yep, cheers, RT, all the better for some bay foliage!

  13. Saarbo 13
    7 December 2013 at 12:53 pm

    Very good article KJT…Yes, I wonder why Labour are so keen on this policy, this is the sort of policy that might impress a tribal National voter but wont make them switch to Labour, this policy will piss off some Labour voters though. And then David Parker mentions that the alternative is to put GST up, what about increasing the top rate of Income Tax, surely that is the alternative if we are struggling to balance the books. I think we probably have to increase the age of Super at some stage, but perhaps Labour should have announced this policy when they were entrenched in government, for implementation in the following term…

    • Draco T Bastard 13.1
      7 December 2013 at 3:38 pm

      I think we probably have to increase the age of Super at some stage,

      Nope. Just need a Universal Income. Keep working until you decide to stop.

      • greywarbler 13.1.1
        7 December 2013 at 4:35 pm

        That UI, it would solve a lot of problems for the elderly. They went spare, all the accountants and prefessionals, when marginal tax or whatever started reducing super proressively.

        But to ensure that there is inter generational equity and fairness, the young should be kept gaining skills either parenting or just society infrastructure building skills, whatever they need, and the older ones give back to society with volunteer work as they can. That will prevent misunderstandings and feelings of some having an easy ride.

        • RedLogix 13.1.1.1
          7 December 2013 at 5:16 pm

          But to ensure that there is inter generational equity and fairness, the young should be kept gaining skills either parenting or just society infrastructure building skills, whatever they need, and the older ones give back to society with volunteer work as they can

          An exceedingly pertinent point gw.

          In my experience many, many ‘retired’ people are actually very active in their community in a whole range of activities essential to our social and cultural life. Everything from quietly doing volunteer work for DoC (one area I’m personally familiar with), through to running the local museum or Historical Soc, or social work for the Sallies, the local Op Shop, the school committees, the sports clubs, even just or minding the neighbours kids for a while. The list and variety is endless and yet it’s rarely reported, celebrated or even properly measured.

          I would argue that in fact New Zealand gets rather good value for it’s Superannuation.

          • karol 13.1.1.1.1
            7 December 2013 at 6:42 pm

            I agree on the importance and value of the voluntary activities.

            I am cautious though about promoting voluntary activities as the thing for all those 65+ to be doing, rather than being in paid employment. On the one hand, I dislike the way many very necessary activities for society, are left to the voluntary sector: eg stuff done by the sallies etc. If they are of value to society, they should be paid for. Being voluntary, also lowers their status and perceived value to society.

            Also totally giving up working and engaging in activities of choice may be the best option for some, but not necessarily everyone. It depends on people’s skills and interests.

            Right now I enjoy being semi-retired – working part time in a less well paid job than my previous main career, but having plenty of time for other projects (and sometimes writing for TS 🙂 ).

            There are advantages doing activities of choice that aren’t paid of the paid workforce (no stress about having to please the (wo/)MAN in order to get the necessary income.

            But, paid work also has some advantages – the mix of people and the kind of work; the ongoing in-service training; ongoing checks to the way the workplace/organisation is working, etc, etc.

            • RedLogix 13.1.1.1.1.1
              7 December 2013 at 8:28 pm

              Yes. I think you hit the nail on the head with the idea of choice.

              Somewhere way back I read a line that roughly went; “unless you can say ‘no’ to someone and walk away with your dignity, you are their slave”.

              In the modern world most of us do not have much option of saying ‘no’ to working and retaining our dignity.

              The idea of a UBI is that it would be both sufficient to maintain an essential level of dignity and decency and universal. That would mean that working would always be a positive choice … something you want to do rather than having to do.

              And the vast majority do want to contribute. They want to express their creativity, their ability to excell, or to work in a team to achieve something meaningful. The fact that so many people choose to do voluntary work in retirement, work that is meaningful to them, is proof of this assertion.

              What scares employers crapless is that no longer would they have queues of desperate people willing to do their shitty jobs, pushed about by toxic bullying middle managers, themselves sliced and diced by policy manuals, GANNT charts and soul-crushing KPI’s that measure completely the wrong things.

              A whole swath of businesses would have to start actually treating their employees like actual humans. Or vanish as many of them should.

              • karol …
                7 December 2013 at 8:34 pm

                Yes, a UBI would basically change the whole playing field, or rationale for working. And profiteering employers/business owners, or top tier managers would hate it.

                • KJT …
                  7 December 2013 at 9:49 pm

                  Some genuine entrepreneurs, who are usually cash strapped, would see it as the income and freedom to pursue new business ideas.
                  Also, with the knowledge that in the event of bankruptcy or business failure at least their family can survive.

                  • Draco T Bastard …
                    7 December 2013 at 10:51 pm

                    Some genuine entrepreneurs, who are usually cash strapped, would see it as the income and freedom to pursue new business ideas.

                    That’s how I see it which is why I think the UI should be set at $400 or even $500 per week.

                    • Colonial Viper …
                      7 December 2013 at 11:43 pm

                      It would lead to a whole lot more creative, cultural and artistic output in society…getting people behaving, thinking and planning along the lines that the capitalists DON’T want.

              • Draco T Bastard …
                7 December 2013 at 9:36 pm

                +11111111111

                Especially this bit:

                What scares employers crapless is that no longer would they have queues of desperate people willing to do their shitty jobs, pushed about by toxic bullying middle managers, themselves sliced and diced by policy manuals, GANNT charts and soul-crushing KPI’s that measure completely the wrong things.

                What scares employers is that they will find themselves not being employers any more and thus not able to exploit the employees to become rich.

          • KJT 13.1.1.1.2
            8 December 2013 at 2:28 pm

            In about 2040 super is expected to take 10% of GDP. Horrors!

            http://www.stats.govt.nz/browse_for_stats/population/estimates_and_projections/NationalPopulationEstimates_MRAt30Jun13.aspx

            Considering that pensioners are already around 14% of the population and expected to double by 2040 that proportion of GDP does not seem unreasonable. Especially as many will still be working and pay more in tax than they get in super. Not to mention the many unpaid contributions pensioners make to society.
            That is if you, like me, think that GDP earnings are to support New Zealanders, not banks, which already take much more than 10% of GDP.

            Peter Harris, ex CTU economist, is essential reading for those, who think giving money to the financial sector to play with, is the answer to superannuation.
            http://www.policyprogress.org.nz/wp-content/uploads/2010/12/Superannuation-and-Retirement-Savings-Peter-Harris.pdf

  14. infused 14
    7 December 2013 at 12:59 pm

    Is this not the same argument as ‘trickle down’ which you all say does not work?

    • bad12 14.1
      7 December 2013 at 1:31 pm

      No thick head it is not the same argument, trickle down which allows the ‘rich’ to grab the biggest slice of the pie with encouragements from the Government relies on those same ‘rich’ to relinquish parts of such enrichment which the theory has it will then trickle down to the poorest,

      Trickle down FAILS, (as it was obviously intended to do), as the ‘rich’ refuse to part with their windfall profits,

      Wealth transfer ‘works’ because it is the Government acting as middleman taking from those who hoard the wealth and giving back to those who’s spending and labour created the wealth in the first place in what should be a continuous loop which only ceases to work properly when Governments decide unto themselves that some within the loop are deserving of less than others…

    • Naturesong 14.2
      7 December 2013 at 1:32 pm

      No, ’cause folks with less money spend a far larger proportion of it back into the economy. Which gets taxed as well as going pack to suppliers (production of item/food, wages etc, which then gets respent etc. The owners of the capital involved also get their cut every step along the way as well)

      People who already have more money than they need to live comfortably will save it, pay down debt, buy land etc. This type of economic activity does not stimulate the economy very much, if at all.

      Think back to national raising gst – what sort of fiscal incompetant would attach an anchor on economic activity when the economy was contracting?

      Building a pipe from the treasury coffers to fletchers bank account was their stimulus plan.

      National, they really are idiots.

    • McFlock 14.3
      7 December 2013 at 1:44 pm

      no. Pensioners don’t buy $14k-a-plate meals cooked by a celebrity chef who flew into the country for a couple of days.
      They spend their money at the local store.

  15. bad12 15
    7 December 2013 at 1:04 pm

    Yep, didn’t take long for everyone to hear the music and the song remains the same, i heard that same music in the leaders speech He made at the Party Conference,

    Email Cunliffe and tell Him while His economic spokesperson continues to trot out Neo-liberal economic policy there’s no way you can vote for Labour…

    • Tim 15.1
      7 December 2013 at 3:04 pm

      “Email Cunliffe and tell Him while His economic spokesperson continues to trot out Neo-liberal economic policy there’s no way you can vote for Labour…”

      +1
      But I did that many moons ago.
      As KJT infers, JUST when you think Labour has come to its senses, along comes a pop-up neo-liberal dressed in Labour drag to stuff it all up.
      It’s like on again, off again, on again, off again! How many times before they get their shit together?
      We’d just gotten to the stage of my considering a split Green/Labour vote next election after Cunliffe had made some progress – then along comes Parker – obviously emboldened by the old careerist guard who still just can’t past what it is they think they’re there to represent (i.e. themselves, their egos, their careers – all packaged up and justified under labels such as ‘pragmatism’, and ‘responsible management’ and ‘with rights come responsibilities’ and any number of other bastardisations, acronyms and hero worship of neo-liberal spin and invented ‘anti-language’.

      I’ll give ’em one more chance ONLY because I’ve become heartily sick of voting for the least worst option – especially when there are now viable alternatives.

      And even if that does mean another three years of Wheelan the Wrecker and his mates’ junta (including the closest thing we’ve ever come to a fascist state, crass and embarrassing egos fed by Madge and Mandela foto-ops, an environment that’s becoming increasingly polluted by the day, divisiveness/bene-bashing/greed-is-good/othering/selfishness et al) you can be sure that come 2017 the backlash will have grown so strong it’ll be worth the wait.

      As others have alluded to above ….. Labour STILL hasn’t actually said anything realistic about reversing some of the damage done during the Ruthenasia era.

      And Labour are hoping for dirty filthy bennies and minimum wage workers and the struggling self-employed small bizz/contractors to get out and vote for them are they? (Good luck with that!)
      It’ll take more than an attractive, youthful and intelligent spokesperson with an ample set of crockery and a concern for their plight to convince them to vote when a) no substantial policy or alternatives to the bene-bashing status quo has been forthcoming, and b) when the pop-up neo-libs drop their clangers!
      Really fcukn pathetic! (Sorry DC – but it is!)

      • bad12 15.1.1
        8 December 2013 at 8:18 am

        Well said Tim, my vote was never going to go back to Labour based solely upon the election of David Cunliffe as the leader,

        i waited with impatience for His speech to the Labour Party Conference needing to hear from Him the detail of ‘the death of the Neo-liberal experiment’ and a ‘truly RED Labour Party’

        Having read and re-read that speech i gained no sense that there will be any change from the Clark Government,(a excellent piece of management of the Neo-Liberal agenda so far implemented),

        In the face of the obvious, Caucus will use Cunliffe as the front for Business as Usual i can only move my vote permanently to the Parties further left than Labour and sadly for the first time i believe that will also include my electorate vote in the hope that MMP Coalition politics will force from Labour a reforming leftist Government,

        As someone has also suggested, i too have the inkling that Labour are happy in the political sense to promote raising the age of superannuation entitlement as this will give NZFirst oxygen and there are many in the Labour Caucus who would leap at the chance to be able to shut the Green Party out of the Government while in essence forcing from them an agreement upon confidence and supply….

    • karol 15.2
      7 December 2013 at 6:08 pm

      I just tweeted @DavidCunliffeMP & @ nzlabour my disapproval.

  16. Descendant Of Sssmith 16
    7 December 2013 at 1:04 pm

    Still waiting for any of these polices from Labour:

    http://thestandard.org.nz/a-quick-question-2/#comment-490834

    I could add to my old list but seriously can Labour in it’s current guise come even close to implementing a single left wing policy such as:

    8 hour workingday
    40 hour working week
    Decent minimum wage
    Increased taxation of the well off
    Increasing benefit rates to a liveable amount – at minimum putting the $20-00 per week back on benefits – you know the $20 per week they put back on super and the one they had 9 years to put back on benefits but did not
    Centralised wage bargaining forcing firms to compete on the quality of the product and service not on who can pay the crappiest wage
    Ensuring minimum salaries are say 120% of the minimum wage to stop employers getting around the minimum wage requirements
    Building more state housing and letting people live in their state houses for their entire life if they wish – you know giving people security
    Employing people with disabilites and young people in the public sector to give them an opportunity for a decent life and a good start – cause the private sector won’t and will never employ them all
    Regional development to support rural areas and not just farmers

    These things were not even “left” when I was growing up they were normal

    Maybe I’ve missed their press releases – don’t tell me Labours not a rightwing party.

    And in relation to super I suggested about a year ago that they income test from 65 to 70 with a simple income test – you can earn up to the equivalent in NZS again and still get it. After that you can earn but not get super.

    This would allow part-time but not full-time work and still ensure people had a reasonable amount of supplementary income.

    That would give a total income of $60,000 for a couple and $40,000 for a single person by themselves – half super, half other income. A couple could earn an additional $15,000 each ( or one partner $30,000 ) and a single person $20,000 – figures rounder for simplicity.

    • Colonial Viper 16.1
      7 December 2013 at 1:15 pm

      All very good ideas.

      And in relation to super I suggested about a year ago that they income test from 65 to 70 with a simple income test – you can earn up to the equivalent in NZS again and still get it. After that you can earn but not get super.

      With some kind of abatement regime as opposed to a hard cut off, that would work well.

      • Descendant Of Sssmith 16.1.1
        7 December 2013 at 1:43 pm

        Nah hard cut off with some tolerance for minimal amounts over the limit like happens now with WFF (but not for those on benefit).

        The point is to allow some part-time work but if you choose to work full-time then you should not get super.

        Abating slowly only creeps up the ability to work full-time and still get super.

        Working part-time gives you increased leisure time but still allows firms to utilise your expertise while freeing up employment for younger people.

        I’m all for older people – particularly working class – having a retirement before dying.

        “All very good ideas.”

        All past Labour policy when Labour represented workers and the poor.

        • blue leopard (Get Lost GCSB Bill) 16.1.1.1
          7 December 2013 at 2:14 pm

          @ Descendants of Ssmith

          +1 I agree with your part-time/fulltime cut-off idea.

          It seems that this should be the first approach to take on this issue and would be interesting to know what the numbers are for that approach on the financial cost to the government.

          People profiting from their businesses and still working full-time do not need the payment, yet at present take it because of a ‘why wouldn’t you?’ type thought pattern.

      • Lanthanide 16.1.2
        7 December 2013 at 2:52 pm

        He’s suggesting a 100% abatement rate, which I believe is far worse than any other abatement we have in practice at the moment, as far as I know. I remember seeing a figure for a particular scenario where the abatement rate worked out to 91%, which was something like student loan + child support payments + coming off a benefit + tax.

        An abatement rate of 100% means in practice something like this:

        You earn $19,000 you get an extra $20,000 in super from the government: total $39,000
        You earn $20,000 you get an extra $20,000 in super from the government: total $40,000
        You earn $21,000 you get an extra $19,000 in super from the government: total $40,000
        You earn $22,000 you get an extra $18,000 in super from the government: total $40,000
        You earn $23,000 you get an extra $17,000 in super from the government: total $40,000
        …
        You earn $40,000, you get an extra $0 in super from the government: total $40,000
        You earn $41,000, you get an extra $0 in super from the government: total $40,000

        In other words it ensures that people have no reason to do a job that earns between $20-40k a year because they get no benefit. And if they do a job that pays $60k a year, they’re only $20k better than a job that paid $20k a year, but they’re doing $40k extra worth of effort.

        Now, there isn’t necessarily anything absolutely abhorrent about this particular state of affairs. But it also isn’t the panacea it initially appears.

        • Tim 16.1.2.1
          7 December 2013 at 3:41 pm

          Christ Lanth! quite a wakeup call really – your stats aside

          How come Labour seem utterly unconcerned so far that there are actually people on 19K – 20K pa.
          And dirty filthy bennies on less than that!

          Take a couple of steps back, and start from there. You might begin to understand where trad Labour voters come from.

          Supposedly NZ is a ‘first world cuntry’. I could show you places in poverty-stricken northern India that are doing better than we are !

        • Draco T Bastard 16.1.2.2
          7 December 2013 at 3:52 pm

          You earn $41,000, you get an extra $0 in super from the government: total $41,000
          FTFY

        • Descendant Of Sssmith 16.1.2.3
          7 December 2013 at 5:16 pm

          Nope I’m saying at $21,000 additional income you get nothing. You’re now earning more than someone on NZS alone.

          If we’re going to say that NZS is a liveable income then earning the same amount by working / investments must also be a liveable income.

          In effect this is raising the age for those who can and wish to still earn leaving alone those who are unable to do so for whatever reason.

          Simply raising the age will simply mean blue collar workers, the ill, the unwell, the located in the wrong place, the discriminated against will end up on a lower rated benefit.

          30,000+ of the current crop of those on benefit would have previously been on super – they are not the ones able to work, with investments and rental properties, with work available. That 30,000 pay the price of increasing the age last time.

          They are paying the price through getting a much lower rate eg single person living alone on super $410-32 per week, single living alone on benefit $230-40 per week. They are paying the price through work and social obligations that they would not previously have had and so on.

          I’m not sure why those with the least income and the biggest degree of disadvantage should pay the biggest price if the age is lifted. That is what would happen though.

          That’s why my preference is for some sort of means testing til 70.

          Those that miss out are those with the most income and most capability to continue working.

          I’d also get rid of the inclusion of underage spouses. It seems to me a policy designed in the days when the husband was older and the bread-winner and like widows benefit is an anachronism well past it’s use by date.

          I find it difficult to support lifting the age for older people while still leaving younger people able to not be subject to the same requirements that others their age have in order to receive state support simply by virtue of being in a relationship with someone on NZS.

          So yeah given a choice I’d means test rather than increase the age.

          I’d also increase benefits before spending more money on NZS and put any savings into increasing those benefit rates.

          • KJT 16.1.2.3.1
            7 December 2013 at 8:48 pm

            “I’d also get rid of the inclusion of underage spouses. It seems to me a policy designed in the days when the husband was older and the bread-winner and like widows benefit is an anachronism well past it’s use by date.”

            This again has unfair consequences.

            OK a real case.
            The wife, in question, could hypothetically be a husband, is 60. Has spent the last 30 years caring for a disabled child. She is too old and “inexperienced” to have any chance of getting a job. Husband has to retire due to ill health.
            Presently both get the married rate of super.
            Should they have to live off selling down their assets, including super savings, until she qualifies for unemployment payments.

            Again, this shows that we do not value unpaid work enough.

            • Descendant Of Sssmith 16.1.2.3.1.1
              7 December 2013 at 9:58 pm

              Benefits aren’t asset tested and under super age spouses are already income tested. Assets wouldn’t have to be disposed of any more than they would now.

              I just don’t see why you should be treated differently cause your partner is on super as far as things like looking for work are concerned.

              In your real case if still looking after a disabled adult child then she wouldn’t have to look for work.

              Plenty of sole parents looking after disabled kids most of their lives as well who now have to look for work.

              Again it’s that divide and conquer aspect – what makes a 60 year old wife of someone on super different in reality than a 60 year old sole parent, widow or partner of an unemployed person. As far as I can tell nothing. I prefer a neutral benefit system without any moral emphasis on any particular group.

              “From each according to his ability, to each according to his needs.”

              And that caring experience would make her quite employable, particularly with an aging population, including an aging disabled population – it’s just that the value placed on caring for people with disabilities is low – whether your own or in paid work caring for others.

              • RedLogix …
                7 December 2013 at 10:42 pm

                As far as I can tell nothing. I prefer a neutral benefit system without any moral emphasis on any particular group.

                Which is one of the best reasons in favour of the UBI. Treats everyone exactly the same.

          • Lanthanide 16.1.2.3.2
            7 December 2013 at 9:19 pm

            Ok, so if you earn $20,000.00 you get $40,000 total, and if you earn $20,000.01 you suddenly only get $20,000.01 total.

            That’s a 2,000,000% abatement rate.

            Good luck with that.

            • Descendant Of Sssmith 16.1.2.3.2.1
              7 December 2013 at 10:02 pm

              It’s not an abatement it’s a cut out point.

              Encourages part-time work, discourages full-time work and getting super.

              By your logic increasing the age means if you earn nothing you get no super. That’s an infinite abatement.

              That’s fucked up isn’t it.

              • Lanthanide …
                7 December 2013 at 10:19 pm

                Abatement is the point at which you stop receiving a government benefit. The abatement rate is the rate at which the abatement happens.

                What you are proposing is a 2,000,000% abatement rate for those who earn 1 cent over what you call the “cut off point”.

                That will never be implemented.

                Even your 100% abatement rate policy is unlikely to ever be implemented.

                By your logic increasing the age means if you earn nothing you get no super. That’s an infinite abatement.

                It’s not “my logic”, it’s the definition of abatement. What you have described is not an infinite abatement, it’s a change in eligibility. Not the same thing.

                • Lanthanide …
                  7 December 2013 at 10:57 pm

                  To forestall any further arguments, I’ll give you an example of what abatement means in practice, and how changing eligibility is not the same as imposing an abatement.

                  Mr Pensioner, playing by the rules, gets himself a part time job that pays $18,000 a year. He also has bank deposits that generate $1,500 a year in interest, bringing his total income to $19,500. This is below the $20,000.01 abatement threshold, so the government pays him his full alotment of super each fortnight, taking his total income up to $39,500 from all sources.

                  Little does Mr Pensioner know, but mid-way through the year, the reserve bank put the interest rates up in order to combat the housing market. Mr Pensioner’s bank deposit now earns $2,100 interest, instead of the $1,500 Mr Pensioner had budgeted for.

                  This puts Mr Pensioner’s total income at $20,100, which is $99.99 more than the abatement threshold. Being a law-abiding citizen, Mr Pensioner dutifully reports his interest income to the government in his end of year tax return. Suddenly 2 weeks later he is sent a letter from WINZ demanding he repay $20,000 of superannuation he is no longer entitled to.

                  Talk about unintended consequences.

                  What if we change the rules, so that the abatement works on quarterly income instead? So if you earn $15,000 in the first 3/4 of the year, and then $10,000 in the last quarter, for a total income of $25,000, you still get to keep $15,000 of your superannuation but may need to pay back the final $5,000. Ok, well you’ve addressed (sort of) one problem, but you’ve now created a loop-hole where people can deliberately structure their income so that they get to claim 75% of superannuation and forfeit the final 25% by shifting all of their excess income to the end of the year.

                  Btw, this is how student allowance already works. Student allowance is paid weekly, and there’s a weekly threshold where abatement kicks in. If in any week you earn more than this threshold, you are required to call up Studylink and advise them of your weekly income, and they will adjust your payment for that week as appropriate. Aside from the fact that this seems churlish and unfair, it’s also a huge pain in the ass (especially when Studylink screw up and start deducting your allowance in future weeks where you earn under the threshold and you have to ring them up and argue with them over and over again to get them to fix it…). So a lot of students don’t do it – either on purpose, or because they aren’t aware of the rules or don’t care. Thus we end up in a situation where the Student Allowance costs the government more than it ‘should’ be costing – personally as someone left-wing I don’t mind about that as I generally support student allowance. But we also end up in a situation where some proportion of people that haven’t properly declared their income over the year get discovered by Studylink and end up having to pay their allowance back, and I shouldn’t need to tell you how disruptive to someone’s life that sort of debt can be…

                  So, this therefore is the significant difference between an abatement and a change in eligibility. If eligibility is raised to 67, someone who is 66 and earning $19,500 or $20,100 during a year gets to keep all of it and doesn’t have to worry about keeping an exact track of how much they’re earning. Whereas in an abatement scheme, someone who is 66 and earning $19,500 or $20,100 can have life suddenly made very very difficult for them.

                  • Descendant Of Sssmith …
                    8 December 2013 at 6:15 am

                    I covered the rise in interest rate / increase in pay rate scenario here.

                    “Nah hard cut off with some tolerance for minimal amounts over the limit like happens now with WFF (but not for those on benefit).”

                    For the self employed / working it’s currently WINZ policy not to set up debts unless it’s felt there was deliberate intent to mislead. IRD’s policy is the same.

                    There’s absolutely no reason the same exercise of discretion and sensible judgement can’t happen in this case.

                    (It’s to their shame that those on benefit get treated differently in the same circumstance.)

                    • Lanthanide …
                      8 December 2013 at 6:39 am

                      Ok, so how do you define “minimal amounts over the limit”?

                      $1,000? $2,000? $3,000? $4,000? $4,500? $4,495?

                      The biggest problem with laws is that they have to be fair, and be seen to be fair, to everyone. It’s impossible to write a law that is both broadly fair to everyone while also accepting of specific individual cases, without it resulting in a huge bureaucracy, which because it is staffed by fallible humans will still produce outliers deemed to be ‘unfair’.

                    • Descendant Of Sssmith …
                      8 December 2013 at 7:00 am

                      Really. I’d think that the lack of discretion and setting a debt up in each and every case would require more bureaucracy than human judgement.

                    • Lanthanide …
                      8 December 2013 at 1:01 pm

                      Erm, that sounds like a tacit admission that your policy is unworkable.

                  • RedBaronCV …
                    8 December 2013 at 11:10 am

                    With Income tax and means testing being on annual income in arrears and welfare benefits being weekly in advance so to speak these sorts of conflicts already exist all over the place. Honestly, any scheme has to be designed that doesn’t require endless discussion with the state. Higher wages would help a lot all through the working years.

        • felix 16.1.2.4
          8 December 2013 at 8:30 am

          “And if they do a job that pays $60k a year, they’re only $20k better than a job that paid $20k a year, but they’re doing $40k extra worth of effort.”

          lolz Lanth, that’s quite a cartoonish view of the relationship between effort and remuneration.

          • Colonial Viper 16.1.2.4.1
            8 December 2013 at 9:33 am

            And the Westpac CEO who earns $6M p.a. is putting in an astonishing $6M worth of human effort. True Randian Superheroes, these.

            • Arfamo 16.1.2.4.1.1
              8 December 2013 at 9:44 am

              It’s pretty gruelling stuff mentally to be earning that sort of amount. You need lots of material compensation to counter the stress of making sure you earn obscenely more than you can usefully spend.

          • Lanthanide 16.1.2.4.2
            8 December 2013 at 12:57 pm

            Personally speaking, I work a lot harder and put in a lot more effort at my current job than I did when I worked at The Warehouse. I also get paid approximately 6 times more.

            If it was a choice between working part-time (eg, semi-retired) in a job where I could coast along like The Warehouse earning $40k, and another full-time job that was significantly more demanding earning $60k (remember we’re talking someone who is 65+ here, unlikely to be ‘rising through the ranks’ at that age), I’d be highly enticed by the part time job.

            YMMV.

            • felix 16.1.2.4.2.1
              9 December 2013 at 8:34 pm

              “YMMV”

              I should fucking hope so, it’s a pretty specific set of circumstances you’re describing.

  17. blue leopard (Get Lost GCSB Bill) 17
    7 December 2013 at 2:04 pm

    Thanks for this excellent article KJT and for initiating a dialogue over this issue.
    This is a very useful debate to have
    I was very troubled when I heard Labour are still banging on about raising the retirement age and I like your framing of the issue re that it is a faulty approach to see superannuation solely as a ‘cost’. I agree and see this focuses on where the real fault is with this approach.

    Realising I didn’t know the full story, I have been searching for the full policy that Labour intends to pursue. I was hoping to read that before I commented. The download is taking forever. So I have yet to read their draft policy

    Perhaps you or someone else could share the details if they are known?

  18. RedBaronCV 18
    7 December 2013 at 2:05 pm

    Of all the policies they could be promoting why oh why this one. The biggest losers under this are low paid and/or female. Who votes for labour – oh same group.
    Nor do I want to start down the slippery slope of means testing, leaves an open door for any future right wing government to slice at cut off etc to get their hands on the money flow.

    Read the discussion on Interest.co.nz that someone pointed at the other day. There was plenty of appetite for taxing non resident landowners. In the Herald this morning is some large farm for sale at Taupo. How about a 33% or higher tax on the any sale price? Reverses trickle down or at worst lowers the price so it is affordable for a local.

    Reversing trickle up, although expectations need to be managed, should be the start point. Perhaps, like the UK and US there is now a large % of the population to the left of the major left wing parties.

    • alwyn 18.1
      7 December 2013 at 2:11 pm

      A “33% or higher tax on the sale price”. That sounds like a great idea. You could extend the idea to charging a 33% sales tax on the sale of any house in Auckland. That would certainly bring the house prices in Auckland down in a hurry wouldn’t it? No exceptions, every house sale.
      Are you in favour of that? If not, why not? What is the difference?

      • greywarbler 18.1.1
        7 December 2013 at 2:14 pm

        Quite a few thousand dollars on a house alwyn. But your idea has merit theoretically. Did you hear Fitzerald the Irish economist talking on Radio nz to Kim Hill this morning? He mentioned the Celtic Tiger and so on. You would be interested.

        • Descendant Of Sssmith 18.1.1.1
          7 December 2013 at 2:25 pm

          Taxing all business income at gross would leave homeowners alone and business owners contributing to the country. This would go for farms and rental commercial properties.

          It’s too easy to avoid tax by purchasing more businesses / properties and loading them with debt.

          Take expenses out of the equation and leave those between the business and the owners / shareholders.

          • RedLogix 18.1.1.1.1
            7 December 2013 at 5:40 pm

            An alternative idea I quite like, theoretically at least, is to eliminate all direct company taxes altogether. (Except of course for GST.)

            As long as the cash-flow is retained in the business, to build its capacity and productivity, then it would not be taxed.

            But the moment it is transferred out of the business to any person, then it attracts the top personal rate for that individual.

            Obviously to make this work you would have to carefully define the ‘grey’ area of assets that can belong to a business, but are of obvious personal benefit to an individual, such as cars, boats, houses and the like… and any expenses related to them such as interest, insurance, maintenance etc. I would propose that these types of ‘personal’ assets be excluded totally from a business balance sheet.

            • Descendant Of Sssmith 18.1.1.1.1.1
              7 December 2013 at 5:59 pm

              GST is in effect a gross tax for workers but an offset tax for businesses (GST in less GST out).

              Just like normal taxation the workers can’t claim any costs back.

              A gross tax on both business could be as low as 5% – 7% I’m picking.

              The difference is every business would pay it as a cost of doing business in NZ – vertical integration to minimise tax would be pointless, shareholders could actually take note of real expenses not just ones to minimise tax, taxation would be simple and could be collected more often eg by the 20th of the following month, personal taxation could be lowered to match over time, internet sales made to NZer’s could also be taxed easily at the same rate, there’s less incentive to not put income through the books – those extra sales would only cost you 5% not say 30% in taxation, banks would be taxed more appropriately, and so on.

              No business in this country should pay no tax just like no worker pays no tax – some illegal stuff aside.

              • RedLogix …
                7 December 2013 at 6:30 pm

                That’s fair enough. Your 5-7% gross is near enough to my zero tax rate in one sense.

                The problem with a fixed rate on gross income is that businesses have totally different cash flow profiles, some operating on very high turnovers, but low margins … and others with the exact opposite. Taxing them both on gross turnover has a completely different impact and breaks the ideal of horizontal equity … that like cases should be treated similarly.

                The underlying reason I went for zero was that the current regime is ridiculously complex and simply begs to be gamed. My suggestion is based on idea that businesses are a rather different kind of actor in the economy than individuals.

                By way of an analogy. When a person owns say a digger for the purpose of being a contractor(analogously a productive entity like a business)… we don’t tax the digger directly, but we do tax the net income they derive from it which is of benefit to the individual.. Indeed when you account for depreciation on the digger, the argument becomes even stronger.

                If we consider businesses as simply a kind of ‘productive asset’ in toto, then it’s a huge simplification to simply not tax them directly, but rather tax the ‘personal benefit’ they generate. (And the rule would only apply as long as the cash stayed in both the company and the country.)

              • RedLogix …
                7 December 2013 at 6:53 pm

                I should add … I don’t think we are that far apart. I think your suggested 5% on gross would be perfectly workable, but not too much higher or it would have the kind of horizontal equity impact I mentioned.

                (And its not very dissimilar to how many mall operators work, charging a flat 10-20% straight off the till; which is linked to the mall’s own system.)

              • alwyn …
                7 December 2013 at 7:01 pm

                A couple of things.
                A tax on gross revenue, with no deductions for costs actually encourages vertical integration. There is an advantage in doing it. It is to remove this problem that GST is only charged on the added value of a business, by deducting the amount you have paid on your purchases.

                One cannot equate a tax of 30% on pre-tax profit to a tax of 5% on Gross sles.
                Woolworths New Zealand Ltd had gross sales of $5.57 billion and a net profit of $128.9 million in the year endind 30 June 2013. That is 2.3% of the sales and is typical of retail businesses.
                Fletcher Building had a wonderful year and made a pre-tax profit of $442 million on a turnover of $8.517 billion. That is just under 5%.
                Businesses really don’t make very big profits as a percentage of turnover.

                There are some quite good arguments for abolishing company tax completely. You simply divide up the profit, whether paid out or not, among the shareholders and they have to declare, and pay tax on the amount. You have to treat overseas shareholders as if they were locally resident of course.

                • Descendant Of Sssmith …
                  7 December 2013 at 7:39 pm

                  Nah it discourages vertical integration.

                  Currently vertical integration reduces tax liability as businesses layer in order to pay the lowest tax rate at each layer.

                  I’ve seen a set of accounts for instance that has 12 layers of businesses that conveniently charge fees etc to the layer above that magically ensure each business pays the lowest possible tax rate.

                  In a gross situation you wouldn’t do this because each layer would pay tax (an expense in one layer would be income in the next layer down.)

                  You’d be incentivised to keep the business unlayered. That in itself would mean productivity gains and a reduction in the number of businesses etc that are set up, reported on etc.

                  Shareholders, once unencumbered by worrying about taxable profit would hopefully now start looking at the costs the business actually incurs – the removal of taxation as an issue would give a much keener focus on actual costs.

                  The tax system would be much simpler as tax could easily be calculated and if tax was to be paid monthly for the previous month businesses in trouble could be identified much more quickly.

                  For a sole trader it would be an easy calculation sold x amount * 5% rather than having to work out what is claimable and what is not.

                  The banks wouldn’t waste everyone’s time by trying to scam e.g. Australian parent company trying to charge a fee for using the parent banks name and sorting that out wouldn’t waste IRD’s time.

                  Many employers claim that while they don’t pay tax on profit but they do on wages if you also dropped the personal tax rates as well then those employers that are labour intensive could well benefit from other businesses such as banks and overseas internet companies being taxed.

                  If you wanted to reduce your tax bill you would be incentivised to lower prices rather than increase expenses.

                  • Descendant Of Sssmith …
                    7 December 2013 at 7:51 pm

                    “Businesses really don’t make very big profits as a percentage of turnover.”

                    I assuming you mean gross taxable profit which is of course dependent on what it is deemed can be claimed for tax purposes.

                    Those things of course are quite arbitrary and not always actual expenditure. It would be interesting what sets of accounts would look like and how much profit would increase when lowering tax mechanisms were no longer relevant.

                    An example might be depreciation which would not be needed.

                  • RedLogix …
                    7 December 2013 at 8:03 pm

                    Shareholders, once unencumbered by worrying about taxable profit would hopefully now start looking at the costs the business actually incurs – the removal of taxation as an issue would give a much keener focus on actual costs.

                    And on running the business productively.

                    If nothing else I believe this has held NZ back for decades; that boards and management have long been driven by perverse incentives that put tax minimisation well ahead of actual business productivity.

                    Otherwise +100.

                  • alwyn …
                    7 December 2013 at 8:46 pm

                    I think that you and I have different ideas as to what is meant by vertical integration. I take it to be where all the steps in the supply chain are carried out by a single corporation. Thus a company, as Ford used to do in the United States, mined iron ore, turned it into steel, made into engimes amd bodies, assembled the car, transported it to the dealers and so on.
                    Your fifth para says that “you would be incentivised to keep the business unlayered”. That is what I would interpret as you would be incentivised to go in for vertical integration.
                    You seem to mean that a single corporation is artificially broken into a number of companies that each do one level of the process. I would have thought that was vertical disaggregation. It appears that our disagreement is due to a different view of what the term means. On our respective understanding of the term I think we are in agreement as to the result.

                    • Descendant Of Sssmith …
                      7 December 2013 at 10:09 pm

                      Aye I was thinking of Shell who owned the various steps down the chain from production through to distribution and sales as opposed to Ford or Carnegie Steel.

                      Oil companies, both multinational (such as ExxonMobil, Royal Dutch Shell, ConocoPhillips or BP) and national (e.g. Petronas) often adopt a vertically integrated structure. This means that they are active along the entire supply chain from locating deposits, drilling and extracting crude oil, transporting it around the world, refining it into petroleum products such as petrol/gasoline, to distributing the fuel to company-owned retail stations, for sale to consumers.

                      http://en.wikipedia.org/wiki/Vertical_integration

                  • KJT …
                    7 December 2013 at 9:10 pm

                    You have an issue here with turnover vs profit/income.

                    For example a Lawyer may have a profit/income of 60% of turnover.
                    A builder would be more likely to have 10%.
                    A shop as low as 2%.

                    Taxing gross business earnings favour businesses with low supplies/inputs and overheads.

                    I like the idea, at least in theory, that tax is only incurred on actual income from a business when it is paid out to the owners/shareholders. I can see ways that could be gamed also, however. If I can I am sure a tax accountant can see even more.

                    • RedLogix …
                      7 December 2013 at 10:13 pm

                      For example a Lawyer may have a profit/income of 60% of turnover.

                      But the lawyer never leaves that 60% in the business. At some point it has to be drawn out as personal income. At that point it should be taxed.

                      The trick is to ensure that any business assets and expenses, are strictly for business purposes only and are not mixed with ones that are for personal benefit.

                    • Descendant Of Sssmith …
                      7 December 2013 at 10:18 pm

                      But the lawyer never leaves that 60% in the business. At some point it has to be drawn out as personal income. At that point it should be taxed.

                      I’m saying tax it when it’s originally earned as gross income but at a much lower rate. Then you may not have to worry about taxing the worker at a higher rate.

                      The worker can’t claim his costs back.

                    • Descendant Of Sssmith …
                      8 December 2013 at 6:19 am

                      I would also argue that the tax system currently favours businesses with high infrastructural use – those with high overheads ie have more physical costs, more depreciation, etc are the exact businesses who use more of the enviornment and more of the government built infrastructure.

            • Flip 18.1.1.1.1.2
              8 December 2013 at 9:46 am

              An interesting idea which would increase the value of the business over time as more was retained in the business. What do you envisage would happen upon sale of the business?Would you include a capital gains tax?
              Businesses try to externalise costs so the important thing would be to ensure that a business paid for all the resources it exploited. I think currently the taxation is needed as a business exploits resources it is not paying for properly. This is particular true of waste and natural resources. Not just waste in production which is mostly accounted to the business but also waste of the product which is a cost to society and the future. This is particularly evident in the drive to make products disposable and so require people to continually purchase. There is little to no cost to a business of producing products that use resources which are lost to the future and create a disposal cost. That is externalised to society.
              I do not think such an idea could be implemented independently of a raft of other changes. That is not to say it could not be done but in isolation there would be a series of detrimental side effects.

      • RedBaronCV 18.1.2
        8 December 2013 at 11:39 am

        I was actually looking at taxes that could be raised that didn’t impact too negatively on the local population not Auckland house prices as such. Moving overseas rentier landlords off our patch looks better than raising gst.

        Yes we could ask the “buyer” not the seller of all properties in Auckland who are companies and trusts or residents who already hold interests in rateable properties exceeding say $50000 to pay a premium (tax) over and above the price they pay. Seller gets the same price no matter who buys. To stop indiviuals buying then transfering to a company, rinse and repeat, tax is at the greater of transaction price or rateable value.

        There used to be taxes like this called land taxes and stamp duty and also a land aggregation and settlement act 1920. Applied nationwide but probably nothing to stop them being applied specifically to “properties within the following boundaries”.

  19. red blooded 19
    7 December 2013 at 3:17 pm

    I’m clearly not going to win majority support in this discussion line, but I’m quite comfortable with raining the retirement age, so long as there is decent provision for those whose state of health makes it unrealistic for them to continue to work. In fact, this is one area in which I think good old Peter Dunne has talked some of his much-vaunted common sense – choose your age of retirement, knowing that retiring earlier will mean a slighter lower retirement income, spread over a longer span of time.

    Why do we assume that people want to retire at 65? We are living longer and most people want to continue living active lives. We already spend a heck of a lot more on people in their last 10 years of life than we do on their first 20. Nobody wants elderly people to be uncomfortable or unhappy, but perhaps we should remember that on the whole people who feel productive and connected to their communities are more satisfied with their lives.

    Making it easier to slowly step out of the workforce through a staged reduction in hours/workload would also be a great help. At the moment people who would like this option are like those at in the first 90 days of employment – entirely dependent on the ethics of their employer, rather than supported by equitable employment law.

    • Colonial Viper 19.1
      7 December 2013 at 4:48 pm

      Why do we assume that people want to retire at 65? We are living longer and most people want to continue living active lives.

      Because 45 years of working for the Man is long enough to go away and do your own thing. Of course, if someone wants to keep working and is able to, that is their choice and they are welcome to it.

    • RedLogix 19.2
      7 December 2013 at 5:05 pm

      Our current social model has it’s foundations in our grandparent’s lifetime, when most people started their first job around the age of 15 and were able to work in one occupation for the next 45 odd years, retired at 60 and were likely dead by 70.

      The modern world has changed this completely. Most occupations now demand tertiary education until you are in your early 20’s, you may need to change your occupation several times, and retirement can happen any time between roughly 55 and 75. Worse still many careers only start to pay well once you get into your 30’s, and by the time you hit 50 you’ve become unemployable.

      For many women with families, the situation is even more fraught.

      My own father started working around 22 was forced to retire at 58, and is now over 87. He looks like he’ll last another decade. He may well be retired longer than his working life.

      Increasingly people’s formally recognised working lives are becoming a smaller and smaller portion of their total lifespan. If you imagine that the answer to this inexorable trend is to constrain a decent income to only those who are ‘working’ then I think you are heading down a dead-end.

    • weka 19.3
      7 December 2013 at 6:26 pm

      “I’m clearly not going to win majority support in this discussion line, but I’m quite comfortable with raining the retirement age, so long as there is decent provision for those whose state of health makes it unrealistic for them to continue to work.”

      Heard of the experience of WINZ and ACC clients? What makes you think NZ is capable of adequately assessing who needs to retire on health grounds?

      The other problem with your point is fairness. Some groups of people die earlier. Why should they have less years of retirement?

    • Rogue Trooper 19.4
      7 December 2013 at 7:45 pm

      good points red blooded

  20. Disabled Liberation Aotearoa NZ DLANZ 20
    7 December 2013 at 4:19 pm

    Thanks for writing the article. Labour has not yet rid itself of its tenure of duplicity following the turnarounds from the Helen Clark / Jim Anderton times 1999-2008, Starting with their cancellation of ‘bridging the gaps’ for Maori; the failure to correct the injustices of National’s Employment Contract, including deserting the maritime industry by continuing to leave our coasts to foreign crewed ships…too much tied into environments determined by economy rather than people.

    Disabled also have reasons not trust Labour as they did not lift work restrictions imposed by National, as Ruth Dyson promised to change. Labour also carried on the further medicalization of society by trying to eradicate disabled from the 5 yearly NZ Census as if to deny disabled their own identity…all for economic ideology??

    No thanks, what is needed is political parties thinking of the most vulnerable before profits…Green AND OR, Mana are good bets. Get people voting is the requirement if change is to happen.

    keep smiling
    Doug Hay
    DLANZ

  21. cricklewood 21
    7 December 2013 at 5:17 pm

    I cant figure out why Labour would want to raise the age all it does is make life difficult for the working classes esp those in relatively physical jobs who inevitably break down and cant get acc…
    And remember whilst money may trickle down it sure as hell floods up… to my mind thats a core difference in the right left economic philosophy around benefits and stimulus

  22. red blooded 22
    7 December 2013 at 5:53 pm

    Just a few comments in reply:
    Cricklewood – You don’t have to believe in trickle down in order to think that it’s sensible to make changes to the retirement age. You seem to assume there must be a link between these two, but certainly haven’t proven one.
    DLANZ – I am disabled, and keen to be independent. Please don’t make generalised assertions about what “disabled” want, as if we are all the same and share the same values and aspirations.

    Red logix – “Increasingly people’s formally recognised working lives are becoming a smaller and smaller portion of their total lifespan. If you imagine that the answer to this inexorable trend is to constrain a decent income to only those who are ‘working’ then I think you are heading down a dead-end.”

    Please have another look at what I actually said. Yes, we are living longer – agreed. I talked about choice, flexible steps towards retirement, stronger labour laws to support people making choices about how to approach retirement and about ensuring a decent income for retirrees.

    Plenty of people dread retirement – some because of loss of income, but many because they enjoy their jobs, or at least enjoy the sense of purpose, economic independence (which is about HOW you earn your income, not just how much you receive) and meaningful social contact. I’m not saying that retired people can’t have these, but many struggle with one or more of these aspects of life. Moving towards a lift in retirement age shouldn’t be seen as a threat, if it’s handled in a caring and inclusive way. It’s not just about costs, it’s also about quality of life.

    • Colonial Viper 22.1
      7 December 2013 at 5:58 pm

      Plenty of people dread retirement – some because of loss of income, but many because they enjoy their jobs, or at least enjoy the sense of purpose, economic independence (which is about HOW you earn your income, not just how much you receive) and meaningful social contact.

      So, what makes you think that the age of NZ superannuation eligibility is a ‘compulsory resign-from-your-job age’? It isn’t you know.

      Moving towards a lift in retirement age shouldn’t be seen as a threat, if it’s handled in a caring and inclusive way. It’s not just about costs, it’s also about quality of life.

      Apart from a sort of PR firm creepiness about this comment, why lift the retirement age? Where are the jobs going to come from which justify increasing the excess labour pool in society?

      Can we not decrease the super age in a “caring and inclusive way” and make sure that it’s not “just about costs, it’s also about quality of life”?

  23. cricklewood 23
    7 December 2013 at 6:17 pm

    @red blooded (no reply on mobile) my preference is to stimulate by pushing additional funds at the bottom rather than the top as I see it its preferable to either leave the age as it stands or even lower it so you dont end up with a large collection of people stuck in there late 50s early 60s who are pretty much worn out stuck on a sickness or unemployment benefit because they cant get acc. If they could retire with some grace when they needed to they are likely to spend there super and push it back into the economy where it will inevitably return to the state through tax in the mean time hopefully making life a bit easier… seems better to me than cutting taxes for those earning 100000+

    • Colonial Viper 23.1
      7 December 2013 at 6:27 pm

      Again, good economic thinking here, provide stimulus to the grassroots of communities, not austerity measures (no matter if they are mild ones).

      My next question is one of political analysis: understanding how politicians prioritise, which constituency is Labour hoping to impress with this policy announcement?

      What’s the bet that Fran O’Sullivan etc. will have something nice to say about how realistic, forward looking and sensible this policy is, and how Key has his head stuck in the sand?

      Nothing like Labour forcing National to the Right…although is this how it’s supposed to work.

  24. rich the other 24
    7 December 2013 at 6:28 pm

    Remarkable ,
    I havn’t read all of the posts but I have yet to see anybody suggest the obvious , generate more money, we can then afford to keep the retirement age at 65.

    Simply support the govt’s exploration program , any one of the regions identified could benefit the country by as much as $12 BILLION ,we have 18 of these areas.

    This issue will be the nail in labours coffin and parkers speech the other day confirms a split and turmoil ahead for labour.

    • BM 24.1
      7 December 2013 at 6:31 pm

      This.

      If Labour had any brains they’d get in behind the oil exploration program.

      Unfortunately they won’t because they’re a pack of useless taxpayer tit sucking wastes of space, their retirement is secure and looking awfully comfy therefore there’s no issue, just make the proles work a bit longer!!!

      Apart from Shane Jones the whole lot should be taken out the back and shot.

      • felix 24.1.1
        7 December 2013 at 7:32 pm

        “Apart from Shane Jones the whole lot should be taken out the back and shot.”

        Ooh, an incitement to mass murder. How surprising from the right wing.

    • Colonial Viper 24.2
      7 December 2013 at 6:32 pm

      how about stopping the banks exporting $2B pa to Australia, and not digging up anything extra.

      • BM 24.2.1
        7 December 2013 at 6:49 pm

        $12 BILLION x 18 = 216 BILLION DOLLARS.
        That’s 48,000 dollars per person who lives in NZ currently, honestly what the fuck is wrong with labour, Christ we should be going for broke and labour should be there waving the pom poms.

        The banks can keep their measly 2 billion.

        • Colonial Viper 24.2.1.1
          7 December 2013 at 6:55 pm

          They’re only electronic credits and debits…just push the keyboard without digging up the ground.

        • McFlock 24.2.1.2
          7 December 2013 at 7:26 pm

          So best caseis to spend 18 times the annual tourism revenue by permanently fucking NZ tourism’s unique selling point, the main reason to fly 30 hours to get here.

          Yeah, that’s national party financial management for you.

          • BM 24.2.1.2.1
            7 December 2013 at 7:57 pm

            Spending?

            • McFlock 24.2.1.2.1.1
              7 December 2013 at 8:40 pm

              what’s worse – typing the wrong word while distracted, or damaging a more valuable and sustainable industry in order to exhaust a limited supply?

              • BM …
                7 December 2013 at 9:06 pm

                Why is our tourism industry going to die, Norway doesn’t seem to have an issue.

                Best of both worlds shit load of coin being made of both oil and tourism, absolutely no reason why we can’t do the same.

                The only people against oil exploration are the 10% dung eating/ cavorting druid party, everyone else is like “Fuck yeah, drill, drill,drill.”

                • McFlock …
                  7 December 2013 at 10:58 pm

                  Well, there’re also the ones who saw how badly NZ dealt with a single ship. So a citation might be required for your “everyone else” bullshit.

                  But then you’d probably say the same thing about having our streams running liquid cowshit, too.

    • felix 24.3
      7 December 2013 at 7:30 pm

      “Simply support the govt’s exploration program , any one of the regions identified could benefit the country by as much as $12 BILLION ,we have 18 of these areas.”

      That’s not how you spell “company”.

    • weka 24.4
      7 December 2013 at 7:57 pm

      “I havn’t read all of the posts but I have yet to see anybody suggest the obvious , generate more money, we can then afford to keep the retirement age at 65.

      Simply support the govt’s exploration program”

      And when that well runs dry?

      • rich the other 24.4.1
        7 December 2013 at 8:50 pm

        Weka,
        I’ll be a 110 and the country will be a dynamic and prosperous place to live.

      • KJT 24.4.2
        7 December 2013 at 8:55 pm

        How many millions of dollars of gold was taken out of Thames (Coromandel)?

        When the mines closed the town was bankrupt, and most of the inhabitants were on the dole.
        It took regional development, a car plant years later to get the town out of the doldrums.

        How many wealthy people on the West Coast?

        • BM 24.4.2.1
          7 December 2013 at 9:00 pm

          Nothing lasts for ever, maybe the people of Thames should have put a bit of money aside instead of blowing it all on booze and hookers.

          • KJT 24.4.2.1.1
            7 December 2013 at 9:14 pm

            The miners where not paid that much.

            The money was blown on booze and hookers by the owners in Auckland and London.

            • Draco T Bastard 24.4.2.1.1.1
              7 December 2013 at 10:01 pm

              Which is what always happens in capitalism and why it always collapses.

            • RedLogix 24.4.2.1.1.2
              7 December 2013 at 10:02 pm

              Exactly. I recall reading that in 1850’s almost quarter of the known world’s GDP was made in the goldfields of Victoria. (Quite a staggering statistic)

              While some of it stayed in town, the vast bulk of it finished up in Melbourne and London. Nah the actual workers saw sod all.

              Gold discoveries in Beechworth, Ballarat and Bendigo sparked gold rushes similar to the California Gold Rush.[7] At its peak some two tonnes of gold per week flowed into the Treasury Building in Melbourne.
              The gold exported to Britain in the 1850s paid all her foreign debts and helped lay the foundation of her enormous commercial expansion in the latter half of the century.

              http://en.wikipedia.org/wiki/Victorian_gold_rush

              I’d think that was at least one of the reasons why the contemporaneous 1854 Eureka Rebellion is largely credited with the beginnings of a politically independent Australia.

          • felix 24.4.2.1.2
            7 December 2013 at 9:59 pm

            “maybe the people of Thames should have put a bit of money aside instead of blowing it all on booze and hookers.”

            That’s not how you spell “food and rent”.

    • Draco T Bastard 24.5
      7 December 2013 at 9:58 pm

      I havn’t read all of the posts but I have yet to see anybody suggest the obvious , generate more money, we can then afford to keep the retirement age at 65.

      Typical RWNJ response straight out of their ignorance of what an economy actually is.

      Hint: Money is nothing and so generating more money will leave us unable to afford anything.

      Simply support the govt’s exploration program , any one of the regions identified could benefit the country by as much as $12 BILLION ,we have 18 of these areas.

      And leave us with no resources to provide the goods and service we need ensuring that we won’t be able to afford anything.

  25. Descendant Of Sssmith 25
    7 December 2013 at 6:28 pm

    I’m always worried when people start conflating ACC to benefits as if they are same and similar when they are not.

    If we want to pay more for people who have not had accidents then lets do that by increasing benefits.

    If ACC aren’t paying people they should then lets deal with that by restating what ACC is for.

    I worry because it’s a quite different social contract (loss of right to sue, etc) and equating it to a benefit simply gives the right a way of denigrating it and destroying it in the same way they do benefits.

    There are strong lobby groups who think that people with disabilities etc should get the same as victims of accidents and there’s value in that argument but they in my view fail because they buy into the deserving poor argument (grandparents caring for grandchildren another example).

    All benefits need lifting – not just some particular groups.

  26. cricklewood 26
    7 December 2013 at 6:50 pm

    @ viper (damn mobile) imho the strategy is where labour goes wrong… its all over complicated in that with the retirement age they are just in oppose/embarrass John Key mode. His stance on retirement no matter the reason to me is correct.
    Surely simpler to say Labour will stimulate the economy by say lowering super and the money will be spent in nz. The nats tax cuts will be used to stimulate the economies of Hawaii, Fiji etc… its simple makes sense and should actually appeal to the people labour purport to represent… its the oppose for oppositions sake that turns me right off bothering to vote…

  27. cricklewood 27
    7 December 2013 at 6:54 pm

    Cant edit either should read lower super age of eligibility

  28. red blooded 28
    7 December 2013 at 7:22 pm

    CV, don’t make assumptions about my understanding. Where in my comment do you see me suggesting that we have a
    compulsory superannuation age? If you look again, what I DID say is that this doesn’t have to be seen as a negative policy. You don’t have to agree with me, but I see it as perfectly sensible to consider the (average) proportion of a persons life spent in employment rather than the raw number of years. When people lived shorter lives, an earlier age of retirement made sense. Twenty years ago, the (compulsory) age was 60. Now the voluntary age is 65. As lifespans increase it is perfectly reasonable for the retirement age to lift. As for where the jobs are going to come from – hey, older workers also pay tax, make purchases, help to run businesses etc. And active older people (on average) enjoy better health and thus make fewer demands on the health system. Nobody is arguing that there shouldn’t be decent support for those who need it earlier, but we shouldn’t shut our eyes to the fact that the super age will eventually be raised. Thinking ahead about how to manage that in a reasonable way shouldn’t be taboo in a progressive society.

    JK has his head in the sand over this because he is scared of the blue rinse backlash. Good on Labour for putting it on the agenda.

    • RedLogix 28.1
      7 December 2013 at 7:45 pm

      As lifespans increase it is perfectly reasonable for the retirement age to lift.

      The reality is that you are really only ’employable’ (esp in the private sector) between about the ages of 25 -55. That’s only a 30 odd year window in a total lifetime that these days can easily be 80 yrs or more.

      Any idea how hard it is to find another job at 63? No matter how well qualified you are. Many employers just want biddable younger workers, not someone who has actually done it all before, seen most of the more usual fuckups and is over-apt to name bullshit when they see it.

      I would argue that ‘work’ increasingly defines a smaller and smaller portion of our total lives. We need an income distribution system that reflects that fact. Like Tat Loo (CV) I’ve long argued that the best was to achieve this is the exact opposite of what you have in mind … lower the age of Superannuation to 18.

      Make it truly universal.

    • Rogue Trooper 28.2
      7 December 2013 at 7:50 pm

      😀 Brave (not last) words famously.

    • Olwyn 28.3
      7 December 2013 at 8:14 pm

      red blooded: I don’t think that the problem here is solely with projected changes to the retirement age. Both the given justification and the context raise questions that go beyond that.

      The given justification was that treasury had said that GST would have to go up to 17% if the retirement age was not raised. This implies (1) that treasury must be obeyed, and (2) that a consumption tax, which effects the poorest citizens most, is the first port of call for needed revenue. Which in turn suggests that nothing substantial is about to change in a hurry.

      Members and affiliates voted overwhelmingly for David Cunliffe as leader because they wanted change, and he in turn has promised a red Labour Party and not a pale blue one. This retirement age thing, by itself, looks decidedly blue-tinted and corporate appeasing.

  29. MrSmith 29
    7 December 2013 at 8:14 pm

    Labour should be talking about lowering the retirement age for fuck sake, what a vote winner that would be and as for paying for it well we just find a way, this is basic goal setting the goal is a retirement age of 60 bottom line then we work out how to pay for it, some of the morons around here and elsewhere have fallen into the trap of believing some crap an economist or commissioner came up with that if we are living longer then we have to work longer……

    Our lives are meant to be getting easier Right! we should be working less for more money Right! and if we are not we need to have a sit down and work out where we are going wrong or have been for the last 30 years. Which party is proposing to drop the retirement age? They will have my vote in a second, don’t get sucked into all this doing the right thing bullshit your being feed because we haven’t saved enough people.

    • Rogue Trooper 29.1
      7 December 2013 at 9:09 pm

      Save Our People From Lawnmowers

    • Will@Welly 29.2
      7 December 2013 at 9:55 pm

      When Muldoon brought in National Super, he had a mandatory retirement age of 60 – this worked against many working & middle class people because alot of them then were unprepared for retirement. Rich people in business were unaffected, they could and did work on. Virtually every successive Government has come in and tinkered with National Super. The one constant argument is had we stuck with Roger Douglas’s scheme back then we would be a much wealthier country than we are now.
      I think retirement at 60 should be upto the individual – some people are burnt out by then, others are happy to carry on working regardless. And I think National Super should be means tested. Not punitive, but in such a fashion that it decreases once you pass a certain threshold. What is the point of paying it to someone who earns $100,000 plus – greed !!
      As for G.S.T., it started out at 10%, now it’s at 15%. As for raising it to 17 or 20%, who is that going to hurt the most – those in the lower socio-economic groups who spend most of their money each week. Treasury don’t give a monkey’s – they’re part of the problem – fat cats on big salaries, scoffing up big bonus’s, they simply don’t care. What this country needs is a serious philosophical debate without the “guiding interventionist hand” of Treasury involved. Surely by now people have realised Treasury is nothing but a mouth-piece for the extreme right in this country.
      As for wages in this country, in the last few months, I’ve seen two jobs advertised i did over twenty years ago, both for fairly reputable firms back then. Yes there have been changes, but what has appalled me, when I went in and had a good look at the sort of salaries they were offering for both those positions, in one case, the money was still the same, in the other case, 20 years later, the remuneration had grown by only $2,000.00. We talk about growing the economy, and the trickle-down effect, but my observation is, most Kiwis now work longer hours than ever before, for little or no pay increase. The ones at the top are the ones raking it in.

      • Lanthanide 29.2.1
        8 December 2013 at 4:42 am

        I’m in favour of raising GST, purely because it’s a consumption tax, and if there’s anything we need to do less of, it’s consume.

        It would need to be coupled with sufficient other tax changes so that those in the bottom 50% of income will come out ahead (not even) once everything is factored in. Realistically that’s probably only possible by implementing a UBI or having a tax-free bracket of something like $20k income.

        • Colonial Viper 29.2.1.1
          8 December 2013 at 8:16 am

          Not bad. And let’s double GST on brand new items over $5,000. (A luxury tax in other words).

          • Lanthanide 29.2.1.1.1
            8 December 2013 at 2:19 pm

            I’d have no problem with that. Although possibly exclude housing in some manner; maybe floor size might be simplest. Anything 200m or less is charged at the normal rate.

          • alwyn 29.2.1.1.2
            8 December 2013 at 3:04 pm

            That’s a great idea.
            We could have double GST paid by someone who is buying a one litre Suzuki Alto for its list price of $15,000.
            Meanwhile one could get a low end Rolex watch for say $4,500 and pay GST at a lower rate.
            That sounds just the way a luxury tax should work, doesn’t it?
            (And no., I have no idea what a Rolex really costs but I suspect you could get one for less that $5,000)

            • Colonial Viper 29.2.1.1.2.1
              9 December 2013 at 12:39 am

              So? I have no probs with any of that. Buy ’91 Honda Accord for $2K and you’ll be fine. Otherwise if you can afford a brand new Suzuki (or whatever) then you can afford the GST.

        • Will@Welly 29.2.1.2
          8 December 2013 at 10:32 am

          The thing is raising G.S.T. has long term implications, any tax benefits factored in for lower social-economic groups tend to be at the lower end of the spectrum, and are easily lost with changes of Government. People on low incomes tend to spend most of their incomes, thereby paying more in tax % wise, while those on larger incomes may spend more, but also save more, thereby paying less in tax % wise.

  30. tricledrown 30
    8 December 2013 at 7:30 am

    British Movement
    Is this the same ratio of return for the cycle ways motorways
    No way .

  31. tricledrown 31
    8 December 2013 at 7:48 am

    The Labour party increasing retirement age is political suicide.
    But the costs of a rapidly aging population can”t be ignored.
    The cost of health care is the scariest cost that money has to come from some where .
    National has cut the Cullen fund .and incentives for kiwisaver.
    Labour has to reinstate cullen fund contributions and make kiwisaver compulsory for everybody.
    Tat loo CV.
    Communism leads to totalitarianism.
    Capitalism leads to monopolism.
    Some where in the middle their is a balance.
    Why bother being in the labour party if you don’t like hardly any of their policy.
    You would be better supporting Social Credit.
    The labour party has never beenagainst capitalism.
    It has been shifted by its coalition parties.

    • Colonial Viper 31.1
      8 December 2013 at 8:17 am

      At your service.

      And yes the Labour Party has always been a capitalist party. But there are many forms of capitalism, and in specific sectors of society, democratic socialist approaches could be implemented.

    • Draco T Bastard 31.2
      8 December 2013 at 1:11 pm

      But the costs of a rapidly aging population can”t be ignored.
      The cost of health care is the scariest cost that money has to come from some where .

      No amount of money will address that. What we need to do is to plan how to have the needed goods and services available with a shrinking work force. How we do that is going to have to be through more automatics at places like supermarkets to free up the people to do the necessary work that automatics can’t. To do that is going to require massive amounts of R&D and the only entity capable of supporting that is the government and the only way that they can do that is through creating money directly and spending it into the economy.

      Communism leads to totalitarianism.

      No it doesn’t. Can you really believe that a state where everybody has a direct say in the policies implemented would lead to totalitarianism? Personally, I think we’ll get more freedom and more responsibility.

      Capitalism leads to monopolism.

      And totalitarianism as we see around us now.

      Some where in the middle their is a balance.

      Nope, that’s just what the capitalists want you to believe so that they can continue ripping off the whole of society.

  32. Ake ake ake 32
    8 December 2013 at 10:54 am

    Woke up this morning, read Granny Herald, had a political epiphany:

    Things are going very well back in NZ. Yes, raise the super age. Why 63? Why only 65? Darn it, raise it to 70. Have a great Christmas feast:

    http://www.nzherald.co.nz/lifestyle/news/article.cfm?c_id=6&objectid=11168855

    Find yourself another restaurant or spa with Ostro, Masu and Aro Ha booked out.

    /sarc

  33. aerobubble 33
    8 December 2013 at 1:04 pm

    Just listening to NR. Guy comes on and says that because society (since the dawn of time) have relied on each other in crisis, even created emergencies services like mountain rescue and other earthquake rescue, that people have gotten soft. Yes, soft for a best effort approach to emergencies. That we rely too much on government, and should be outraged and protesting government, when any sensible reasonable person would say most people think government has gotten it about right. And many like mean understand the real cost of churn for the right is to remove basic services. So I ask you in all of christidom (whatever that means) why would any want to protest and harrass government, a government who wants to undermine local government, who wants to destroy the safety nets, almost as if the government had its minions out looking to hot issues it can sell its neo-liberal backers so as to get re-elected.

    I started reading a book yesterday, and it stuck me, the neo-liberal paradigm was reworked, instead of government being the problem, that markets need to be left alone (though the writer didn’t refute such thinking), they argued that government played no part in creating value (context copyright). That those people who hold power, who own bookshops and printing presses, are wielding influence on what gets stacked and so ‘claimed’ as valued by consumers when they by the rather gross and boring selection of books on a McBookShop shelf. Did this NR guest ruminate about how little revolutionary, evolutionary, scientific, works there are in modern bookshops nowadays, no, but he did refer to the countless wasted words people write online that have no effect or influence. Strange that.

    Clearly the neo-liberals have regrouped and reworked their dogma

  34. blue leopard (Get Lost GCSB Bill) 34
    9 December 2013 at 12:27 am

    I had hoped that there was going to be a shift in emphasis in Labour with the recent change of leadership and the overwhelming numbers of support that Cunliffe received from his platform of moving away from the retarded neo-liberal failure-of-a-political-approach.

    Labour’s recent announcements on superannuation appears to go against this democratically supported shift.

    It appears to me that the ‘issue’ regarding superannuation has a lot to do with the disparity of wealth issue that New Zealand politicians must address first before projecting ‘costs’ of an aging population.

    If the disparity of wealth issue is not prioritised then we end up fixing problems that would be cleared up if this major issue is not addressed first

    As it stands – is there even really a problem?

    I have found a link to a speech by Winston Peters that cites the ‘cost’ of superannuation being currently less than 5% of GDP and is expected to go up to 8% of GDP by 2060. So there we have it folks, we are being told this is a crisis, yet to me the ‘crisis’ appears to be being created through misinformation and it really is a crisis of values – not affordability.

    Do we value the benefits to society of looking after our elderly and most vulnerable people in society?

    I do

    Along with this above information I note that KJT writes in the above article that the calculation of ‘costs’ are not taking into account the direct benefits of looking after our elderly.

    There are also valid concerns raised by others regarding creating unfairness for manual workers and Maori if the retirement age is raised that are simply not being addressed by this approach.

    Regarding raising of the funds to ‘afford’ superannuation (costs of a mere 5% of GDP) Never mind the right-wing comments re developing a dinosaur oil industry, how about addressing the problems of wealth disparity first and addressing tax evasion where NZ is losing 1 – 6 BILLION A YEAR (hey, there’s a novel idea)?

    In other words I would like to see some political approaches that actually address some of the very real problems we face and this might clear up the issue of ‘affording’ to look after our most vulnerable from the outset.

    This raising the retirement age policy is a light, if not dark blue one and I would like to see a great deal more engagement from this ‘new’ Labour party into actually taking new and more effective approaches to our problems if you wish for my vote

    Thanks

  35. Crunchtime 35
    10 December 2013 at 9:43 am

    One or the other of two things required: David Parker’s retraction of his stupid super-at-67 comment, or his head on a platter.

    Please.