The new Business confidence ratings are out and they continue to plummet and the truth is that Labour’s new attempt to appease that plummeting Business confidence will fail.
It will fail because there are 4 real reason as to why Business confidence is plummeting, 2 of them are pathetic and Jacinda will be able to easily knock those over, but two of them are so legitimate the rest of the country and the new Government need to take heed of the warning rather than ignore them.
First, the two pathetic reasons:
1: Shock
Poster boy for the NZ alt-Right, Jordan Williams, publicly bet that he would walk naked down the main street of Wellington if Winston went with Labour. This wasn’t an idle boost because Jordan enjoys walking around naked in public, it was because he and the rest of the business community honestly believed National could simply bribe Winston and take the Government. What none of them appreciated was how much Winston hates neoliberalism and was hell bent on reforming it. The Business community, like many other groups, got caught in their own echo chambers and believed their own bullshit, so the they were genuinely surprised and shocked Jacinda won.
2: Spite
There are a group of family businesses who despise the Left with the sort of fanaticism of Fox News. They consider Labour Communist the way the feral right in America consider Obamacare Socialist. Patrick Smellie does a good point of highlighting the spite element in the low Business Confidence…
Port owners and meat processors are among those particularly nervous because a strike called in one workplace in support of a multi-employer collective agreement could see nationwide industrial action in that industry. Some employers, the Talleys in meat processing especially, would have only themselves to blame if that happens
…these companies will scream ‘Commie’ no matter what the Government do.
These two Jacinda’s charm offensive and Grant’s intelligence can overcome, the naked truth is that what Labour are offering up as the new industrial relation laws are toothless and will only impact those industry who already consider Jacinda a card carrying communist but the two others are impossible to ignore.
1: The reality of National’s fake growth model
Economic growth under National relied on a speculative property bubble, rebuilding from natural disasters and mass immigration, that’s all that kept the GDP inflated and ‘rock star’ like. Low business confidence is proof that fake growth model is over and the business community know it.
2: Global events
Trump’s Trade War, China’s slumping economic fortunes, Emerging Market meltdowns and the grand reckoning for Capitalism that was not paid in 2007/8 are all realities that no amount of working groups will counter. The decade of avoidance the Central Banks set us on by printing trillions and inflating equity and bond markets have created the lowest inflation rates for 5000 years .
There’s no denying that a enormous correction is looming and pretending low business confidence is just all spite misses the much more dangerous signals.
Martyn how about an artical on kiwisaver
Sam stubbs from the none profit kiwisaver simplicity has some good ideas.his ted talk was excellent https://www.youtube.com/watch?v=GRm_5BYcFe8
stop giving these Aussie banks your kiwi saver fees we have a choice now.Sam has brought jack bogles vanguard model low cost index funds to kiwi saver.https://www.youtube.com/watch?time_continue=42&v=hpvLO6OJpsE
Martyn you are correct here.
Winsrton warned that this correction would happen in his election speak as he announced that he will join NZ First coalition with Labour.
https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11934973
QUOTE;
“In his explanation of why New Zealand First went with Labour over National, Winston Peters said the agreement reached in talks was a summation of policies that survived negotiations.
He went on: “As the song says, You can’t always get what you want.”
“Our negotiations have taken place against a backdrop of changing international and internal economic circumstances which we cannot ignore.”
Those in New Zealand First believed that an economic correction, or a slowdown, was looming, and that the first signs were already apparent, he said.
“There’s no denying that a enormous correction is looming and pretending low business confidence is just all spite misses the much more dangerous signals”.
Nailed it Martyn. Excellent article.
1: The reality of National’s fake growth model
We learned yesterday that the firm that owns Burger King in New Zealand has been banned from using migrant labour (ie people on work visas, not resident non-citizens) for a year.
In light of the shortage of affordable houses, and the routing of employers to get migrants for questionable low paid occupations – and reports of employee’s paying for their questionable job, and the fact that all the new people on these low wages probably will qualify for Kiwibuild and also be competing on low cost rentals, and the amount of Maori in jail who could probably get a job flipping burgers instead of the migrants, perhaps time to rethink these bizarre immigration “skilled” skills?
30 years ago it cost around $10,000 to sponsor in a worker and therefore was only used for real high value skills. Time to put that amount with inflation (around $20,000 as least) back on the table to get rid of all the routs.
Main occupations for Skilled Migrant Category principal applicants, 2016/17
Occupation 2016/17
Number %
Chef 684 5.7%
Registered Nurse (Aged Care) 559 4.6%
Retail Manager (General) 503 4.2%
Cafe or Restaurant Manager 452 3.7%
Number of people granted Essential Skills work visas by main occupations, 2016/17
Occupation Number %
Chef 2,178 6.6%
Dairy Cattle Farm Worker 1,617 4.9%
Carpenter 1,478 4.5%
Retail Supervisor 961 2.9%
Cafe or Restaurant Manager 942 2.9%
Retail Manager (General) 767 2.3%
Aged or Disabled Carer 748 2.3%
https://croakingcassandra.com/2018/08/30/work-visas-for-shop-managers/
It’s in businesses bests interests to pretend to be unhappy – the more they moan, the more Labour feel they have to bend over backwards to help out. But it’s both distracting for business and for Labour – and there are huge opportunity costs for both.
The more business feels they can lobby goverment to get deals the less time and money they devote to their own businesses. Labour should just tell them to stop whining and put their effort into their business.
Of those 4 points, overwhelmingly points 1 and 2 underscore current business confidence.
I’m starting a new metric: “ Business Perception”. It’s a measure of how citizens rate their country’s businesses and especially business “leaders”
After a quick ask around I’m starting it at -10 “ Whiney entitled gouging shitlords “ how will future polls rank? Gripping stuff.
Just compare this to the last Labour government back in 1999.
After the winter of discontent in 2000, the truce terms were the government would not go beyond their mainfesto mandate.
Something that would never be asked, or required, of a National government.
This time there has been a more ambitious approach – based on denying this government ever won a mandate, so as to make the case that it does not even have a mandate to deliver on its manifesto/coalition agreement.
The very idea, that it might do so, has led to such a loss of business confidence that the government has to reassure “business” (the older white men in private sector boss jobs) that they have not lost power over how the economy is run, just because their preferred vehicle, the National Party, is no longer in government.
If this is true then Labour has betrayed its union membership, and many of its voters. It would mean there is an estate of power beyond democratic constraint – those who rule regardless of how the people vote have the real power (those who you are not allowed to criticise have less power, if they really did have secure rule over you they would not fear what the people had to say and the democratic outcome that resulted).
Of course one hopes that Labour is just reassuring business that it understands their insecurity. Some in the government would be quite capable of noting that only a generation back, men like these were insecure about their wives having independent careers. And their wives had nuture their vulnerable masculinity, even if that meant being submissive when they would rather ride on top.
This new winter of artificial discontent is a missed opportunity for labour.
Self appointed business leaders think the labour led government is anti business? Bring in compulsory unionism, cap CEO salary, no more cheap migrant labour. What’s to lose, they are spitting the dummy anyway.
Fix the country, Fuck them.
It is like the prostitute sleeping with her pimp, government and business.
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