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Say chee$e

Written By: - Date published: 5:46 pm, February 10th, 2008 - 35 comments
Categories: economy, workers' rights - Tags: ,

At the supermarket earlier this week I was browsing the aisles and noticed the price of cheese. It seems now that for a kilo of this yellow gold (hold on isn’t gold kinda yellow anyway?) you’ll be paying $16. Now that’s a lot of money for what is pretty much a Kiwi staple but it’s a particularly large amount of money if you’re one of the hundred thousand poor sods on minimum wage. In fact it’s going to take you two hours to earn enough in net wages to buy a block of cheese. Or to put it another way: 5% of your income. For cheese.

That’s why I was particularly angered to see this release on Friday from the Wellington Regional Chamber of Commerce telling us that:

‘Immigration rules need to be adjusted urgently to relieve the wage pressure, to allow increased migration to meet employer demand,’

That’s right, your desire to be able to afford cheese (and housing and clothes for the kids and…) is nothing other than “wage pressure” that needs to be relieved by allowing more (presumably non-cheese eating) folk into the country.

Let’s get this straight right now. These employers are saying wages need to come down. We’ve given them a tax cut. We’ve made it very easy for them to do business. Now they want us to be paid less too. You could cut a minimum-wage earner’s tax to Zero and it would still take them over an hour to earn enough for a block of cheese. The problem is wages.

35 comments on “Say chee$e ”

  1. “We’ve given them a tax cut. We’ve made it very easy for them to do business.”

    You say that like you are part of the government. Are you?

    No one from the Standard has come clean yet over your funding issues, your sponsorship by Labour or you supposed independence.

    Now you post things that take ownership of policies of the government, I guess the truth will always out.

    [lprent – asked and answered innumerable times.
    Look at the About page.
    If you’re not going to find something intelligent to say, why come here?
    Go play with photoshop and lose some more votes for the right.
    Explanation for newbies about that comment:
    How to lose some critical votes]

  2. Tane 2

    Bill was clearly talking about New Zealand, Whale – the guy’s even said he’s a Green voter. This smacks of pure desperation on your part.

    Your questions about the temporary hosting mixup have been answered elsewhere. If you’re too stupid to find it yourself why not flick Lynn Prentice an email and ask him to explain it to you again?

    We’re not going to let you disrupt every thread with your conspiracy theories.

  3. Yeah Whale – Bill is actually Michael Cullen and I’m Helen Clark. If you want to talk about secret funding how about telling us if your mate Davey is really running Curia out of National Party HQ?

    On a more topic-related note I see McCarten has picked up on the issue of wages:

    http://www.nzherald.co.nz/category/story.cfm?c_id=280&objectid=10491537

    I think it’s starting to become apparent that wages not tax is the issue. I personally can’t wait to see National’s IR policy announcement…

  4. James Kearney 4

    Fuck Whale’s stupid.

    We’ve given them a tax cut. We’ve made it very easy for them to do business. Now they want us to be paid less too.

    You’re accusing a Green supporter of acting as Labour and saying the Labour party is a wage earner not being paid enough by business? That’s so convulted and so retarded I almost feel sorry for you. Please, for all of us, stop breeding.

  5. Whale, the only way you would be able to win votes for National is attempting the last resort – [Deleted]

    Why don’t you spend your time [Deleted], then you can take a picture and photoshop it first, just to make it look extra special, stick it on your joke of a blog and tell people to vote National.

    It is the last option, Whale. You may as well spend your time trying the last trick in the book.

    Run along child.

    [Tane: No need for personal attacks James]

  6. Benodic 6

    Irish – it’s good to see the wages element of the debate is starting to get some good discussion. It’s been frustrating as hell watching National dominate the debate with tax cuts over the last few years, and much as I dislike Labour’s planned tax cuts I think at least it’s neutralised that issue and in a roundabout kinda way brought it back to the real issue of wages.

    This is where National will struggle and if Labour (and the unions) have any sense they’ll want to give this issue a good run.

  7. Benodic 8

    Does someone want to get rid of Whale? I’m interested in having a discussion here but it’s obvious he’s determined to misrepresent other people’s statements to fit with his conspiracy theories.

    Whale – get some control over your emotions, stop acting like an angry little pubescent boy and leave the grownups to have their discussion. Your father must be ashamed of you.

  8. Benodic 9

    Good, he’s been deleted. Thank you.

  9. AncientGeek 10

    I was wondering how long it was going to be before some business leaders came out with that old chestnut. Classic quick-fix prescription, that just causes more problems down the line.

    They need to look at figure 5.01 in 5 External migration of the Demographic Trends: 2007 reference report.

    Each time the immigration over emigration gets too high like 96 and 02/03 we get some serious over-heating in the economy, mainly because it heats up the building industry, car sales, and a pile of other factors for a number of years afterwards (can’t be bothered going to the rbnz reports). A large chunk of the over-heating goes straight into inflation.

    Now that isn’t so bad if the was room to jump another percentage of inflation. But right now we’re running at about 3.2%, slightly above the approved range. The current net increase is probably part of what is driving our existing inflation.

    So in fact, what the Wellington Regional Chamber of Commerce is asking for is more inflation, and a resetting of the Reserve Bank Act’s bands. Of course as business people who are fully conversant with the economy, they realize this – yeah right!

    What exactly are we getting these extra workers in for? Are they going to put only into export industries where they’d generate wealth for the country?

    Well as we know, Wellington is the great export earning area in NZ. Say what? When did that happen?

    What these clowns are after is, as IrishBill says, that they don’t like the wage increases if they continue with their current level of productivity. So they should do what any economist would suggest. Put the effort in to raise productivity. Don’t ask the government to do a quick fix that benefits no-one apart from themselves.

    BTW: Whale isn’t worth discussing

  10. My apologies, Tane

    [lprent – It is understandable.
    Have a look at the link I attached to his comment.
    It is extremely well written. I’ve been holding it for Whale’s next appearance.
    BTW: you’re getting caught in the d4j moderation trap. Nothing to do with you.]

  11. AncientGeek 12

    So actually I sort of disagree with IrishBill.

    The wages are going to go up. Same as the price of any scarce resource. The real question in my mind is if NZ employers are capable of getting a more efficient usage out of that resource. Can they raise productivity enough to offset the wage increases.

    Frankly I’m not hopeful based on past experience. But it has been 30 years since they were in a position that forced them to do it. May the efficient employer of labour survive, and the inept go under.

    Market forces rule again in the labour market (and thats what these particular employers don’t like)

  12. Camryn 13

    Just a side issue really, but the government doesn’t *make* New Zealand an easy place to do business. All a government has to do is avoid making it a difficult place. It’s an act of restraint, rather than of commission.

  13. Tane 14

    I think that depends on your point of view Camryn. The government provides a police force, it institutes and guarantees private property rights, it enforces contracts, educates the workforce and provides a health system to ensure the population is fit to work. It also sets up the Reserve Bank, monitors inflation and regulates interest rates. And on top of all that (if you take a Marxian analysis), it allows employers to take the surplus value of a worker’s production.

    The discourse of positive vs. negative rights is a false dichotomy. All rights are positive, in that they require a state to set the rules a certain way and enforce them. Somalia has no functional state, but it’s in no way a good place to do business.

  14. AncientGeek 15

    Agreed. A common complaint I hear is that NZ is a compliance cost hell.
    Personally I haven’t found that, and there are various comparitive tables that back that up.

    I always remember looking at doing some remote business in NSW and giving up. Couldn’t figure out if we had to do GST.

    Now where was that link…. I think we were 2nd best. I’ll look it up later if noone else links it

  15. AncientGeek 17

    Thanks – thats the one I was after.

    Obviously these are slightly subjective (see the methodology links), and you find variations between different tables. It is different for different levels of business.

    But we’re always up towards the top for ease of business. Not surprising after you have to deal with the US tax system (for instance).

    Could always do with some improvement. But mainly by doing more things electronically.

  16. Camryn 18

    Tane – Well, I don’t take a Marxian analysis. I also disagree with some of the roles you include as seemingly the basic minimum of government e.g. *institution* of private property rights (they tend to take them away, but it doesn’t mean they create them if they don’t) and involvement in health and education (optional).

    My basic point is that you clearly want to go further than that, and have the government mediate in the employer/employee relationship etc. It’s precisely those type of things that this survey measures, and it’s because we don’t go as far beyond the basic role of government as many countries that we do so well.

    One of the best things about this Labour government is the way they’ve managed to restrict themselves to a fairly mild labour relations reform, some tinkering with the minimum wage, and minimal additional complexity in the tax system (e.g. making IRD handle Kiwisaver).

    P.S. Where do you shop, Irish? Foodtown in Auckland Central does have $16 1kg cheeses, I see. It also has $10 for store brand cheese which is probably made in the same place. I’m sure a family on a tight budget is more likely to shop in a supermarket with a larger format etc and hence lower prices e.g. Pak’n’Save. Yeah, it’s still quite a lot, but it doesn’t have to be $16.

  17. I also disagree with some of the roles you include as seemingly the basic minimum of government e.g. *institution* of private property rights…

    I realise Libz have this religious fantasy that “private property rights” are some independently existing entity, but the fact is without a legal system your “private property rights” consist of what you personally have the weaponry to take and defend. I’ll take the legal system, thanks.

    My basic point is that you clearly want to go further than that, and have the government mediate in the employer/employee relationship etc.

    And the ECA was what, exactly? The govt carefully keeping at arms length and not interfering?

  18. Camryn 20

    Psycho –

    1) I’m not saying we don’t need a legal system to enforce private property rights, I’m just saying that the rights themselves aren’t created by the legal system. They’re not bestowed by the government, they’re protected by the government. It’s one of the most useful things that individuals can get together and do via a government.

    2) OK, Mr Literal… insert “more” after “mediate” and then debate the point instead of being so pedantic.

    Captcha was “dining man”, which is exactly what I’m going to do.

  19. sdm 21

    Dear Dr Cullen
    I am sorry as a hard working employer I havent raised wages enough. I know I like to feel sorry for myself, you know as the economy is going to shit (in the construction sector where I work its very flat), sales are down, my overheads are up, interest rates are up, and yet I could only afford to raise my staffs wages by 10%. I shouldn’t pity myself, and I apologise. I understand that I can’t be trusted with some of my money back. I know that you know better than I do about how that money should be spent. Thank you for not trusting me in my wage negotiations, you made me contribute to kiwisaver. Saves me having to think, and you are much better at thinking that what I am. All these people leaving for Australia is my fault, I realise that. I have tried my best, not giving myself a pay raise, trying to create more work when the work isnt there, but it isnt enough. My staff seem happy enough, but clearly they are lying. I know I am an evil employer, I know that I have sinned, please forgive me Dr Cullen?

    Sincerely enslaved

  20. IrishBill 22

    Camryn, there’s a certain irony in you calling PM “Mr literal” after nitpicking about the price of cheese. But I’m feeling indulgent so:

    1. The cost of plain brand cheese has also doubled.

    2. $10 still means more than an hour’s work at minimum wage (net).

    SDM, if you really gave your workers a 10% wage then that’s commendable but the truth is there’s a whole lot of employers out there that don’t give any rise at all (despite the last eight years delivering record profits).

  21. Tane 23

    I also disagree with some of the roles you include as seemingly the basic minimum of government e.g. *institution* of private property rights (they tend to take them away, but it doesn’t mean they create them if they don’t) and involvement in health and education (optional).

    You’re still assuming private property rights can somehow exist without a government. They can’t. I’ve never understood how someone can ‘own’ property without a legal system that says they can. Where does this natural right that you’re appealing to come from?

  22. sdm 24

    Irish – you have to give raises if you want to keep your staff. It was a straight business decision. But my issue is this – everything is cooling off. Thing is I cant afford to do any more – hell I havent had a holiday or given myself a raise in a long time. Dont blame me for people leaving Australia – I suspect Dr Cullen has alienated a lot of good employers who try and do the best by their staff.

  23. Daveo 25

    Perhaps you shouldn’t be so sensitive sdm. When Cullen says employers need to pay more he’s talking about them as a group and he’s right, employers do need to pay more. That doesn’t mean there aren’t some employers like yourself who are paying well or giving good increases already but the statistics suggest you’re the exception to the rule.

  24. Cheese going up in price could be a good thing for some: too much is fattening and dairy products acount for our poor record of cholesterol. You moan about cheese. What about butter? That has almost doubled in price in the past year, now about $4 for 500gm. As you know these price rises are driven by our success in the international market and will no doubt be made worse by the drought.

    So some business leaders think that immigration will help ease the labour squeeze. Yeah right: same dream as the seasonal worker demand; that a whole bunch of willing workers will appear on demand on a temporary basis when the employer wants, and then disappear miraculously without any further obligations required to them.

    What does the Wellington Chamber of Commerce propose to do with all these immigrant workers when work is no longer so readily available? Further, what do they propose we do about providing this increased population with electricity, water, housing, social welfare and all the other resources that we know full well we are struggling to provide on a resource finite planet?

  25. The way I see it, the price of dairy is not just affected by business savvy, taxation level or wage level in NZ. I remember reading an IHT piece a couple of months back clearly suggesting an increase in international demand, and the demand looking as if it will not abate, although it may plateau. Cactus Kate had a piece recently about how the price of NZ cheese is high, even in HK (which indicates to me how little any impact of trade barriers is having on the price). So Camryn, I shop at both Foodtown and New World and there is parity in the price, maybe between 12 and $16 for 1 Kg. I remember when the price was half that…more immigrants will not change it one bit. A wage increase may make it more affordable however.

  26. Phil 28

    Irish,

    Employers ARE giving out payrises (I want to say “like they’re going out of fashion”, but in respect for differing views on fashionable economic policy, will keep myself restrained). Look at the latest Labour Cost Index numbers – largest quarterly and annual increase since they started calculating them in 1992.

  27. Uroskin 29

    How to deal with cheese price rises? Easy, demand isn’t inelastic for that commodity. Just eat less cheese, buy something tasty, nutritious and healthy that isn’t cheese. And sock it to the farmers at the same time: how dare they asking for higher wages for their cows (by charging higher prices for their product?) can’t they increase the productivity of their worker cows instead? Encourage the immigration of cows or discourage the immigration of cheese eaters?

  28. AncientGeek 30

    Just updating the chee$e. Read this from In a strange land about the price of cheese in aussie The price of cheese.

    I just can’t resist links….

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  • Speech to the Asia New Zealand Foundation
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