Open mike 06/05/2010

Written By: - Date published: 6:00 am, May 6th, 2010 - 26 comments
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26 comments on “Open mike 06/05/2010”

  1. Rob M 1

    All power, no responsibility, no shame – the story of NZ big business:

    Norgate yesterday confirmed that an initial investment of $40 million in the group, followed by $19 million in April last year and a further $1.2 million – a total of $60.2 million – had come from the McConnon family.

    A statement last week said that other than $8.5 million of dividends received between 2004 and 2008 the shareholders of Rural Portfolio Investments would not recover any of their investment.

    Norgate was paid about $500,000 a year by Rural Portfolio Investments as a management fee. He says that figure covered costs for renting office space and hiring a personal assistant as well as payment for his time.

    “I gave seven years of my life out of a significant career so it’s not only the seven years that’s gone, it’s the career path as well.”

    Norgate said he was very disappointed about the situation. The 1400 or so holders of the redeemable preference shares were largely mum and dad investors, though there were some institutional investors, he said.

    He would not confirm speculation about his departure but said: “I do feel as though I’ve done everything I can to New Zealand agriculture. Even the areas that there might be unfinished business people know exactly what needs to be happening.

    “It’s 25 years I’ve been involved here now and I don’t feel as though there’s that much new I’ve got to offer. So you can take it from that that I will be considering other things.”

    • uke 1.1

      Sounds like maybe his passport needs to be flagged, pending a little investigation, before he takes his “career path” overseas.

    • prism 1.2

      I think Norgate had good plans for taking NZ primary industries in a different direction. There were problems, and then the world financial meltdown hit.
      He is not in the same boat as the consumer financiers.

      It isn’t easy to change direction in NZ primary products business. Even dairy farmers with a simple business model of cows, milking, dairy supply etc. can fall over. What Norgate was trying to do was more complicated but offered a new approach that would have benefited NZ.

  2. mach1 2

    I thought I was the pessimist but this bloke takes the biscuit.

    Worse Than 1789?

  3. Pascal's bookie 3

    Nothing like a good home invasion to get the law and order brigade a-howling. The police obviously need more powers so they don’t have to wage the war on drugs with one hand tied behind their back.

    • mach1 3.1

      Awful PB, misanthropy level on the rise, again.

      • Tigger 3.1.1

        They shot a corgi!!!! In front of children!!!! I suspect that was 1,000 times more traumatising than anything the parents did to their kids. But yeah, let’s ensure these filth get three strikes. Hey, why don’t we sterilise them while we’re at it?

  4. I prefer to be a dreamer among the humblest, with visions to be realized,
    than lord among others without dreams and desires

    Kahil Gibran

  5. mach1 5

    Would the person who wrote this be one of Kahil Gibrans’ others Mr Pwog?.

  6. freedom 6

    fun game, finish this sentence

    As the sale price for the allegiance of Maori Party co-leader Tariana Turia is only a measly $134 million over four years, I am sure the thousands who voted for her Party are satisfied knowing Health and Social services for the greater community are going to be …???…

  7. Draco T Bastard 7

    ‘Town of the Future’ residents can’t get broadband

    We’re not talking about rural outposts; we mean suburban and city-dwelling folks who are being told by Telecom they can’t be connected right now try again in 18 months or five years or so.

    Yeah, things have really improved since privatisation – NOT!

    In the interview the Telecom mouthpiece tells us that “over the last few years hundreds of millions of dollars had been spent” on the network. The problem of course was that billions was needed to be spent. Telecom did have the income they just paid it out in the deadweight loss of profits instead of spending it where it needed to be spent – on the network.

    When Telecom was government owned that income would have been spent on the network as it should have been. This spending resulted in a world class digital telecommunications system by the mid 1990s with the work starting in the mid 1980s. Ten years of work and, for much of that time, with close to 17k linesmen and technicians working on it. This should give you some idea of what it’s going to take to get even fibre to the cabinets.

    After that massive investment the new private owners decreased spending on the network till the point where it couldn’t keep the network going and took the rest as profit. It was nothing less for them than a massive windfall and, with such massive profits rolling in and a captive market, they didn’t need to do anything. This, of course, led us to the point where the network just wasn’t capable of doing what is expected of a modern telecommunications system. Because of this the government started, first with Project Probe IIRC, to finance building up the networks capabilities and now the present government was voted in on the promise of another $1.5b boost to the network. We shouldn’t have to be paying that out at all.

    We’ve already paid billions of dollars to Telecom for the purpose of delivering, maintaining and upgrading the telecommunications service. Service that we didn’t get. Instead those billions of dollars went into a few unaccountable foreign and local hands in the form of a deadweight loss. We paid the dollars but got nothing for them – the perfect example of a scam.

    It’s time to renationalise the network (including TC, Vodafone and all the other networks). Put it into hands that are accountable to us as it used to be and that will deliver a telecommunications network that is capable of the demands placed upon it by a modern, dynamic society. One were we won’t be putting in billions of dollars and getting nothing for them.

    • prism 7.1

      Being a neo-lib businessman (person) means never having to say sorry it seems. Or even faintly demonstrating that your actions may have been ill-advised. The P & T needed a shake up but that became an excuse to sell it – the system that we could build and did build ourselves. We could have bought in expertise and still retained ownership.
      I remember the way telecom explained themselves in their first ads. This guy comes into a dairy with a bottle of 20c pieces and wants the dairy owner to count it, he won’t be needing it any more. No now there is a fancy new expensive card, and only card phones available for street calls for a while.
      People couldn’t afford to keep their landlines, though as a public relations measure a few were subsidised by the firm, children couldn’t be given just 20c to call home, at first $2 cards were available but they were soon dropped and $5 is the norm now. So for three children, $6 in cards was needed for communication not 60c. Quite a hike.
      A call now costs a minimum of 70c, up from 50c when some phone boxes were changed for coin. There weren’t any doors on street phones for a while, even where they faced out onto a busy street. No protection for your back, and conversation drowned by the roar of traffic.
      Take it or leave it, and they took the profit. Now the system has collapsed a number of times. Loud would be the sneering if still owned by the government, but as its a business it is just a matter for acceptance and quiet concern with discussion on how the firm can improve the situation with no loud recriminations. And that’s supposed to be best practice for smart countries!?

    • “deadweight loss of profits”

      By definition profits can not be a deaweight loss. This is simple first year economics.

  8. gingercrush 8

    New Zealand and much of the world has not suffered enough in this world-wide recession. No doubt many did face and still face hard times etc etc. But for the majority of us. How much have we really suffered and have any of us really changed our behaviour?

  9. Herodotus 9
    I hope thatthe hotel & hospitality industry will have a social conscienc and at a later date give something back to the community, and not alsways want the council to fund events that they can free load from!!
    Also I hope that the IRD will be investigating those who hire their homes out for the duration of the cup for $2-$3k/week. I heard on the edge? that there was cases of people renting their homes out for the enitre program for $20+k. It maybe small in $ terms yet like those unofficial traders of property that do not pay tax, it would be another example of the honest PAYE worker contributing max tax whilst others enter the black/grey market.

  10. Lanthanide 10

    Looks like Anderton will be the next Mayor of Christchurch:

    That’ll give Labour another chance to thrash National in a by-election.

    captcha: pain 🙂

    • ianmac 10.1

      Didn’t that fellow Cooper MP get elected as Mayor down south but stayed on as MP for a while? He as mayor went out a night and cut down trees from the footpath didn’t he?

  11. Draco T Bastard 11

    Archdruid: The Subsidiary Function.

    It’s hard to think of any principle that flies more forcefully in the face of every presupposition of the modern world. Economies of scale and centralization of control are so heavily and unthinkingly valued that it rarely occurs to anyone that in many situation they might not actually be helpful at all. Still, Schumacher was not a pie-in-the-sky theorist; he drew his conclusions on the basis of most of a lifetime as a working economist in the business world. Like most of us, he noticed that the bigger and more centralized an economic or political system happened to be, the less effectively it could respond to the complex texture of local needs and possibilities that makes up the real world.

    • RedLogix 11.1

      I don’t want to totally gainsay Schumacher, but at the same time my own experience suggests that people are potentially more productive when they work effectively in groups. Roles large corporations typically pay substantially more than equivalent job in an SME because the larger corporation can afford to.

      The problem for me is not that organisations and systems are inherently bad, but that we organise them around a power principle in which all relationships are gamed for personal gain.

      The game changer is this; what if we believed in something different, that we organised according to how we could be of service to each other? If we truly did that, would not our social and economic systems look and function quite differently?

      • Draco T Bastard 11.1.1

        larger corporation = the community

        As for pay. As I’ve mentioned before – cooperatives tend to pay well. You won’t get the multi-million $$$ pay for CEOs/administration that you’ll get at a corporation but the lowest paid will get far more than what they get at the same corporation and this is better for the community as, instead of the wealth accumulating to the top and not going anywhere, it’s spread around evenly and used.

        The problem for me is not that organisations and systems are inherently bad, but that we organise them around a power principle in which all relationships are gamed for personal gain.


        IMO, something that participatory democracy and cooperatives can address without going into any form of dictatorial control.

        The game changer is this; what if we believed in something different, that we organised according to how we could be of service to each other? If we truly did that, would not our social and economic systems look and function quite differently?

        It’s something that we need to do. The present hierarchical system benefits only the few, cuts off resources to those most likely to benefit the community as a whole and gives the majority almost no say in what happens in their community. I really can’t think of an advantage from capitalism.

        • RedLogix

          We’re pretty much on the same wavelength here; I agree that co-operatives (and other forms of heavy-weight profit-sharing) have to be a part of our future.

          But how to get there? Why are we so resistant to the change? Is it just external forces that we need liberating from, capitalist elites holding us down as wage-slaves who will eventually be strung from metaphoric lamposts come the revolution?

          Or is it something within us that holds us back?

          • Bill

            I know people who work for others.
            I know people who work for themselves.
            But I don’t know of any who work with others.

          • Draco T Bastard

            Partly I think it’s something within us. Hell, even I have fantasies of getting lots of people to work for me and with me becoming rich, I can’t do it as I know it’s wrong and immoral, but I do have the fantasies.

            Partly, I think it’s the capitalist elite holding everyone else down. Competition decreases profit (the amount skimmed off the top of other peoples work) to zero so capitalists have every incentive to stop that competition. This is shown quite well, IMO, in the simple fact that there isn’t a Windows compatible OS available considering the immense amount of profits available from that quarter. basically, anyone who tries to release such an item will be sued into oblivion. Even if they win they won’t be able to afford to get off the drawing board. Never mind the simple fact that someone who “owns” the resources that you depend upon to live has a lot of power over you. In this latter respect ownership itself is a major problem and why I think that ownership needs to be devolved to the community (I’m not talking about the ownership of cars and jewellery here but the ownership of the land and resources available to the community).

            The laws that we live under were designed by the capitalists to benefit the capitalists. We need to look at the laws (some of them are obviously worth keeping) and see which ones need need removing or altering to benefit and free up society.

          • prism

            My experience of working with others in social serving co-operative groups has shown me some problems. One is a fractured focus with differing ideas of what the group is trying to achieve, on a spectrum of serving one favoured sector to an ideal impossibly wide.

            Then there is decision-making – people who want to be involved in forming and maintaining the structure, the spirit and the systems of the enterprise have to do some hard thinking and studying. Often people want to spout their favourite dogma or beliefs without thinking about the needs of the enterprise. People in decision-making roles must be committed and loyal to it and bring useful, informed minds to meetings and decision making.

            The term for the forward-looking, smart, responsible personality required for success of enterprises for this century is a ‘pragmatic idealist’.

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