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GUEST BLOG: Bryan Bruce – What is the purpose of an economy?

By   /  July 8, 2019  /  23 Comments

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Last week RNZ reported on two stories that should give us all pause to think about who we are , what we stand for and the ACTUAL rather than the pretend economic policy by which our country is run .

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Last week RNZ reported on two stories that should give us all pause to think about who we are , what we stand for and the ACTUAL rather than the pretend economic policy by which our country is run .

The first was on the queues of people lining up at the Manurewa MSD office on Thursday to get emergency assistance .Some had been there, in the cold and rain since 2 am.

The Minister Carmel Sepuloni put the blame on the Auckland Action Against Poverty group because that’s the day they have their advocates there to advise people about their rights and they won’t spread out their advocacy over the week, through pre appointments and at other offices

Putting aside all other issues (such as trust in the MSD and the need for volunteer advocates at all) the fact that so many people are so desperate for assistance the government itself has had to increase the amount it has allocated for hardship grants to $128.5 million, tells you there is something very wrong with the way we are running our economy.

The second item was about the proposed sale of Westland Milk to a subsidiary of the Chinese milk giant Yili.

The Cooperative has been struggling to be profitable and pay a competitive pay out to its farmer suppliers.

Last year when Prime Minister Ardern visited the Westland Milk Products factory she announced it would receive a $10m loan from the Provincial Development Fund but this was taken off the table in March of this year when Westland Milk signed their provisional agreement with Yili to sell to the oversdeas buyer at $588 million.

What this story tells you is that the government’s continued neoliberal policy of allowing vast sums of foreign investment to wash across our borders means that it is powerless to support our agriculture and dairying industries from being bought up by overseas investors.

The same problem occurred in our housing market when unrestricted foreign money was allowed to buy and sell in our residential housing market . When overseas buyers can pay more for a property than the locals , then the locals miss out. (It is still happening by the way but in a less overt manner).

Who can blame a Westland famer who has struggled to make ends meet for taking a more attractive deal from an offshore buyer when the local deal isn’t as good?

Well of course that’s neoliberal capitalism. Everything is for sale because, to the neoliberal mind, money is the measure of value.

The trouble is that if we keep going down this road there will come a day when New Zealand is entirely operated by people who do not live in our country. What then? Who will be? What happens to our identity as a nation – our democracy?

Again the problem lies in the way we run our economy . The government, for all it’s recent PR about wellbeing is still running to the neoliberal agenda which promotes selfishness and competition over cooperation and the common good .

It still has ‘ a hands off’ attitude to the market place. Indeed it is actively waving foreign investors ashore to buy up our freshwater , milk factories and farms so that it won’t have to raise taxes from our own wealthiest people to pay for our own infrastructure, promote our own businesses and ensure that workers receive a fairer share of the nation’s wealth.

While the government may point excitedly to fact that there are officially less unemployed people in our country as evidence of their economic success , they can only do so by turning a blind eye to the fact that neoliberal economics has turned us into a low wage economy – a Gig economy – where many people have to work 2 and 3 jobs just to make ends meet.

It is still running an austerity budget with $3.5 Billion surplus when food parcel distribution at the Auckland City Mission is up 50% on last year.

It is also to ignore the fact that our richest two citizens now own as much wealth as the bottom 1.5 million of us- and yet our government refuses to instigate any significant form of wealth tax.

Over the last 3 weekends I have posed hypothetical questions on my page which have invited readers to think about their ultimate values . This week let me finish by posing you the real question I asked at the end of my 2012 documentary Mind The Gap…

What is the purpose of an economy?

Is it so a few people can get rich at the expense of the many? (Neoliberal economics)

Or to deliver the greatest good for the largest number of our citizens over the longest time? (Progressive economics)

I’m for the progress ‘greatest good’ approach to running our economy.

How about you?

 

Bryan Bruce is one of NZs most respected documentary makers and public intellectuals who has tirelessly exposed NZs neoliberal economic settings as the main cause for social issues.

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23 Comments

  1. Mark says:

    I’m physically disabled and partially in a wheelchair. Because my wife works I dont get any support from the system. The system is now designed to exclude people because lets be honest, as much as there is tax collection occuring, its not enough to cover all social aspects to really call it a country based on wellbeing.
    So I currently do Airbnb but even that approach is in jeopardy as the govt is now listening to the hotel association about a few empty beds their clients are having because of the competition we create, from this I get to learn whats happening overseas from the guests we have. Germans pay 50% of their income in tax, the right wing rich pricks in this country would cry a river over that because we are too inground and follow the US capitalism approach but none of these Germans complain, in fact they are eager for it to continue, it provides everybody with a free education including university and all they pay is about $1200 a year administration fee, they have first class health care, not this run down pile of shite we have here, their retirements are all covered and all other aspects of the social fabric sorted. I hear similar instances in the Netherlands too.
    I wish my parents never immigrated to this country from the UK, it might have worked out fine for them in the political climate they had but as time as gone by its just gotten worse here for me.
    I’m 50 this year, got a wheelchair via the lotteries commission because the MoH is bloody useless and spend more time finding ways to exclude people rather than help them, Im unemployed because as much as discrimination against disabled people is illegal, that is the real reason, and to top it off because Im married to somebody who works and still doesnt earn the higher tax bracket its enough to exclude me from any support mechanisms.
    This country is designed for rich people or people who dont live here.
    The crux of the issue is political donations, it seems rich people donate flat out, just look at the statements made by Jamie Lee Ross that all the parties went silent on regarding donation splitting, the system is corrupt to the core.
    Yes, New Zealand is now a banana republic.

    • Gosman says:

      Campaign for a party that proposes to increase the top rate to 50% then. See where that gets you. Mana Party anyone?

      • Greywarbler says:

        Gosman gloats. A spiteful reply from you Gosman.

      • countryboy says:

        Great idea Gasman! But lets not stop there. Lets try going in the polarised opposite direction? Neo liberals force fed their shit down our craws? So lets try going on a precisely opposite vector? To, ya know, introduce ‘balance’ into the argument.
        I think a tax rate of 85% on all income above $200k a year, PLUS a GST increase on all luxury cars, holiday homes and ‘investment properties’ up to a rate of 30% and remove GST on foods. How about a ban on foreign investment both ways and reinstate our assets and resources? We ban all foreign banking and asset strip those cash resources they already have in lock down? We write off mortgage debt across the board and invest that money into re establishing our rural hinterlands to rescue those few people still in them from the days when we could buy a house in Tapanui for a dollar. I mean that literally. One whole dollar. Tapanui is the epicentre of some of the richest farm lands in AO/NZ. The provision was that the new home owner would pay the rates arrears accrued when the old owners were forced to walk away from where they’d lived, often for generations, to look for pointless work in logical fallacy cities so as to be able to pay through the nose for what were once their tax paid for services and resources. Lets not forget that, people!
        We then invest in inter city passenger rail, offer maintenance-cost-only electricity to everyone and fuck it! You know what? Lets up that tax rate to 95% above $200 K.
        I know! Crazy!? Zany!? Mad!? Wacky!? Loopy!? Right?
        Neo liberalism was the exact opposite of the above. As extreme, more absurd but one or two got filthy rich, as was the plan, while most of the rest of us have watched our lives ebb away whilst living in anxiety and frustration in a rich land over flowing with vital resources. Got any gas on that Gasman? You and your mates are fucked, you know that right? You and your mates are dead neoliberals crawling. It’s only a matter of time for the spot light to swing around and there you are! Possums pondering “ Oooh! Look? Two suns coming right at me!? How odd? How mesmerising??? How…? How tantalising!????? ( That last one was a bona fide jonky-ism.)
        Great post @ BB.

      • Snow White says:

        Gooseman, you seem to have missed the point here.

        The point is that if the social services established by the previous govt knew how to function efficiently, then volunteer groups would not have to be stepping in to help their clients to interact with them.

        You are not alone here, as MP Sepuloni doesn’t seem to understand this either, or simply doesn’t care.

        That sad queue is the tip of an iceberg mirroring a group of distressed people which should shame us as a community. Try to understand this, as it is actually quite an unhealthy social situation, OK?

        Of course we can do better, and we should be able to without any cost to you if that’s what you are worrying about.

      • Mjolnir says:

        Gosman the fact you have utterly ignore the tenor of Bryan’s story does not speak well of you

        If welfare beneficiaries have to queu in winter weather for help then things are seriously wrong in our country

        Do you have no empathy?? If not, i suggest to yiu a medical condition defined by such a lack of empathy to others

        I think you know the one i mean

    • In Vino says:

      Fully agree with you, Mark. This country has lost its soul.

      • countryboy says:

        @ IN VINO? Aw? No it hasn’t. Not entirely. There are pockets of soullessness, I’ll grant you that. In those bloody awful housing estates? Where there’re laws against when one can hang out the washing? Where no one’s allowed a fence or have a garden that doesn’t meet strict criteria of plant, flower nor God forbid, an ornament! ( There’s a word for that? Body corporate? No. That’s not it. )
        There’s an hilarious place called Jacks Point overlooking Lake Wakitipu where all the houses MUST be made of shist stone, have stone walls built in a manner of the faux period and each ‘house’ must be painted black or grey and have grey slate or shingle roofs. None of your colour carry one or there goes the capital gains. You’re not allowed to hang out your smalls of a sunny, drying day neither. Is that fucked? Or is it just me?
        To drive through the fucking awful place is like driving through a Zombie town without the class. It’s eerie and devoid of humanness. I bet, if a kid’s seen/heard noisily buggering around with another kid? They’d get scooped up, taken to a mental asylum and re assigned for correct, quiet, conservative conditioning. And you know what’s behind that laughable gulag of debt? Yep. The banks. The banks and their insurers. The banks and their insurers are the ones who bleach the arseholes of middle management then turn them into rubber people who comply as and when is excepted of them.
        AO/NZ isn’t so much expressing soullessness as the banks and insurers are expressing evil.
        Dunedin? Wellington? Invercargill? Bluff? Westport? Greymouth? Christchurch is fucked, sadly. So’s Lyttelton now. I loved dear old Christchurch but the earthquakes let in the di$ea$e of con$ervati$m. Lyttelton’s become gentrified; same but different. I’m not too familiar with the North Island but I liked Thames? I liked Helensville until we got chased out of there by a crazed tweaker in a BMW. I only looked at him with a sneer and mouthed ‘get fucked’ and showed him the dexterity of my middle finger? Do you think that might have done it? He went a very funny colour, I remember that. Red through rose with just a touch of pink? Went nicely with his mad, staring, bulging eyes showing more white than a trump convention.
        You might be right @ In Vino? If one wants to find soul one’s probably best to get drunk then go to bed in the middle of the day with the electric blanket on.

        • MickeyBoyle says:

          Jack’s Point has policies on colour schemes and building options, because when the resource consent was given for the development. There was many submitters who were opposed to the development because of the potential to spoil the Remarkables. The developers were then asked to go away and come up with a new plan which would not detract or impede from the surrounding landscape. It has nothing to do with snobbery or not in my backyard soulessness. You may critique it, but I’m all for protecting our most iconic sites, which the Remarkables certainly are, from as much human visual pollution as possible. I might add that I’m a resident at Jack’s Point, and have a vege garden and various ornaments.

  2. DOC HORRORDAY says:

    If the economy is the production and logistical distribution of resources facilitating a given society, then you are really asking what the proper role of a society is. That is a relative concept that varies with each individual and their personal ideals.

    The concept of the greatest good for the greatest many, or the needs of the many outweighing the needs of the few, may cause undifferentiated common mediocrity and a tyranny of homogenised mediocrity.

    You cannot achieve a single moment of independent free thought by that avenue. You risk being bogged down by irredeemable masses. Sadly, idealistic visions of utopian greater goods are simplistic, oppressive, illusory, relative, temporary, tending towards dogmatic and ultimately useless.

    So I return to the start, reducing the word to meaning only the productive and distributive logistics that produce the given society. It contains no ideological guidance beyond that. Hope this helps you liberate yourself from that illusion. All the best, DH

    • spikeyboy says:

      think you messed up on the definition their Doc. Defined as the greatest good for the many. You may have little to no imagination that makes greatest good equal to mediocrity but I for one and I guess BB for another can see a little further than that. Likely we would say that mediocrity is what we now have and that the competitive model that is neoliberalism can only produce mediocrity because it is in its nature to cut down and destroy or colonise and own anything that challenges the hegemony of the elite. Most truly great human enterprises were the result of collaboration and cooperation not individual greatness. Survival of the fittest doesnt mean the fittest individual but the fittest species since no individual can survive on their own. there is no such thing as individual free thought. thinking implies language implies society and others just as your definition of the economy doesnt exist. The production and logistical distribution of resources is an act of people cooperating together. Your disdain for the masses only exposes either your lust for the position of elitism or your accomplisment of the same. Either way I suppose it is to your advantage to portray them as a mediocrity to be despised

  3. Chris says:

    It’s interesting how the old blame the victim mentality rears its head from time to time. This time it’s like how Jenny Shipley said in in the early 1990s said that people who use food banks are alcoholics and that food banks create their own demand. FFS. It’s as if people like being poor and enjoy begging for food.

  4. Greywarbler says:

    I thought a few quotes might describe what I believe our economy should be and do.

    Today’s economy should go for:
    We have the capacity to create a remarkably different economy: one that can restore ecosystems and protect the environment while bringing forth innovation, prosperity, meaningful work, and true security.
    Paul Hawken
    Read more at: https://www.brainyquote.com/quotes/paul_hawken_637129?src=t_economy

    An objective look at the reality of the financial world behind the Wizard of Oz’s green smoke:
    “You know what’s truly weird about any financial crisis? We made it up. Currency, money, finance, they’re all social inventions. When the sun comes up in the morning it’s shining on the same physical landscape, all the atoms are in place.” ― Bruce Sterling

    Not the economy started by this man – the start of the western world’s downfall:
    Ronald Reagan – an actor pretending to be a sage. (Sports announcer, then actor, was President of Screen Actors Guild where he was active in routing Communists, went on television, became a motivational speaker, was a Democrat, changed to Republican, became Governor of California, raised taxes, changed a deficit into a surplus.) In 1969 he ordered in the troops against protesting students with one killed, 128 hospitalised; (probably all commies!). In 1980 he became President and began the supply-side economic regime with tax reductions. Radio commenter to raconteur. Wikipedia and Rolling Stone
    Quote: “You can’t tax business. Business doesn’t pay taxes. It collects taxes.” ― Ronald Reagan
    (A protean character illustrating that having humble beginnings doesn’t engender a generous community spirit towards your fellow citizen.)
    Quote from Goodreads

    Try Confucius’ way:
    To rule a country of a thousand chariots, there must be reverent attention to business, and sincerity; economy in expenditure, and love for men; and the employment of the people at the proper seasons. Confucius
    Read more at: https://www.brainyquote.com/quotes/confucius_717854?src=t_economy

    Michael Moore’s memories are what I would wish for people in a good economy, feeling the wellbeing and not just being consumer animals:
    “It was the American middle class. No one’s house cost more than two or three year’s salary, and I doubt the spread in annual wages (except for the osteopath) exceeded more than five thousand dollars. And other than the doctor (who made house calls), the store managers, the minister, the salesman, and the banker, everyone belonged to a union. That meant they worked a forty-hour week, had the entire weekend off (plus two to four weeks’ paid vacation in the summer), comprehensive medical benefits, and job security. In return for all that, the country became the most productive in the world and in our little neighborhood it meant your furnace was always working, your kids could be dropped off at the neighbors without notice, you could run next door anytime to borrow a half-dozen eggs, and the doors to all the homes were never locked — because who would need to steal anything if they already had all that they needed?”
    ― Michael Francis Moore, Here Comes Trouble

  5. michelle says:

    Not a good example to use Mrs beneficiary soup(shipley) cause she tried to make all beneficiaries eat soup when she was in power yet she was over weight herself and was preaching. And she used the public health system to have her angina sorted she was rushed in urgently when our Maori people are dying not getting scans or diagnosed properly

    • Snow White says:

      Funny you should say that Michelle. I had the misfortune to see a picture of Paula Bennett online yesterday and sat mulling over – wasting valuable time- whether she was more detestable than Shipley, whom I had hitherto regarded as the most obnoxious woman ever squeezed onto a parliamentary seat.

      The similarities are skin-crawling: two fat women who were only able to control their obesity by having expensive gastric bypass operations. What a waste of surgeons, considering.

      Not everyone has the dietary knowledge or the money to eat wisely, but these two should have, so maybe they’re just a couple of greedies, in which case their preaching to the poor was singularly obscene.

      Did Dame S really tell,people to eat soup ? What a nerve. MP John Banks said that beneficiaries should grow their own vegetables – perhaps to make Jenny Shipley soup.

      Parts of NZ have unpredictable growing seasons – where I am is – but these two should have known that life at the bottom is not always that simple, or they could have been playing to the gallery,
      or maybe they believed their own words, which is also not good enough.

      I now think that Bennett is worse than Shipley, and my hairdresser says that she looks terrible – she’s aged 10 years since her op, but I think of her with a smidgen of empathy whenever I tuck into fish and chips or pork bones. ( That’s actually a lie. I’m practising.)

      • michelle says:

        Yes shipley did we called it beneficiary soup yet she wasn’t eating it herself and she got prompt service in the public hospital for her angina attack in the meantime she was bene bashing

      • michelle says:

        pull the benefit is the most hated and her own people hate her the most why she is one nasty piece of work

        • Snow White says:

          Changed my mind, Michelle, and decided that the Dame was worse as she has such a profoundly irritating unctuous manner and patronised everything in sight.I think she was the one who gave a whole new meaning to cost effective medicine, and it’s just as well that she seems to be now helping to bugger up banks rather than human beings.

          Bennett I prefer not to elaborate on, but I do think her more deluded than many in her perception of herself. The pair of them give lie to platitudes about woman being caring and sharing, and they drag all women down with them, and they shame us.

          A lot of their negativity towards others quite likely derives from – consciously or not – feeling negative towards themselves – and deservedly so I must say.

      • spikeyboy says:

        Well if youre going to have at them why not Lange as well or is it only fat women that you detest?

  6. John Souker says:

    The base rate of income tax in the UK is roughly 45%. That government will claim it’s 20% but that is a bare faced lie because employees pay 3 income taxes out of the money set aside to pay them. Then they also pay 20% sales tax on top.

    Be careful what you wish for. Governments are more than happy to tax people and redirect it to the rich and unaccountable. Tax is only part of the answer, we need transparent and representative government and our own sovereignty.

  7. Mike the Lefty says:

    “Who can blame a Westland famer who has struggled to make ends meet for taking a more attractive deal from an offshore buyer when the local deal isn’t as good?”
    You can’t blame the farmer in that situation, of course.
    But what you CAN blame, are governments who have allowed the dairy bubble to keep inflating to the extent that too much money has been invested in an industry in the expectations of ever expanding returns – expectations that could not last for ever but people believed they would because they wanted to believe it.
    And it suited the National Party to inflate the bubble, get the votes and then walk away when it turned to custard.
    And now the foreign speculators are moving in to cash up on the short-sighted policies of former governments.
    That is who is to blame.
    And of course our present government is expected to bail everyone out who was dazzled by the dollars in their eyes and have now come a cropper.

  8. LAST TRAIN TO JACINDAVILLE says:

    The chinese have a philosophy of making a quick buck. If a businessman can make $20k today and forego $100k worth of business in the future he will.
    My bet is after they have raped and pillaged all the value out of the businesses, farms and houses they’ve bought up here they’ll walk away and leave them.
    The idea of Westland farmers opting to take this ‘better deal’ is shortsighted and naieve. These people have no idea what they have let themselves into by allowing such a buyout.
    This is china attempting to take over the country by stealth because we have industry, food, supplies and natural resources here (water etc) that they badly need back home.
    I must question as well, what caused Westland Milk Products to go from a profitable operation to one that needed a life-line.

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