Social policies are aimed at eliminating child poverty by 2020 - including no tax on the first $25,000, removing GST on food and increasing the minimum wage to $15 an hour. It also wants business tax lowered to 25 per cent for small businesses to help small Maori enterprises grow.No tax on the first $25,000; removing GST on food; business tax lowered ... drop the other garbage and the economically illiterate minimum-wage proposal (just watch how the present minimum-wage law increases unemployment over the next few years, let alone a higher one) and they're nearly halfway there.
Monday, 6 October 2008
Fool me once, shame on you. Fool me twice, shame on me. To my great surprise, John Boy Key appears to be sending that very sensible message to violent criminals, and to shop-owners and others who've been the target of those criminals he's sending the message (well, sort of) that it's okay to defend themselves.
Bravo for that much.
John Boy has finally come out with a policy that's both worth a damn, and is different to the other team's. Yes, it's election year, but two cheers for that anyway. It's been twelve years since Libertarianz first introduced its policy that "Life sentences for real crimes will mean life" -- unlike other parties I could mention it's not changed every few years depending on which way the wind is blowing -- so it's worth a cheer or two when the mainstream parties finally catch up.
National's policy of ensuring, or trying to, that thugs won't get the chance to destroy people's lives *more than twice* is half-good, and will keep the rest of us half-safe. Two very loud cheers for that.
Contrary to the claims of both Helen Clark MP and Peter Williams QC in objecting to his policy, "corrections" isn't about "redemption" or rehabilitation for criminals -- and contrary to John Key's claim it's not primarily about "deterrence" either -- it's primarily about restitution for victims, and then protection for us.
The only reason not to take violent criminals off the street -- the only reason -- is that not doing so would safely allow a criminal to make recompense for their crime to the victim.
Government's primary job -- the only one for which it has any moral justification -- is to protect those who value their life, liberty, property and happiness from those who've shown beyond reasonable doubt that they're quite partial to taking them all away. ("The rights of the accused are not a primary," argues Ayn Rand, "they are a consequence derived from a man’s inalienable, individual rights. A consequence cannot survive the destruction of its cause.") That's the only reason to lock people up: not to not to rehabilitate criminals, and nor even to punish them, but to protect us from their savagery.
If John Key understands that much, then he perhaps understands more than I'd ever given him credit for.
That said, Key still resolutely ignores a fairly significant elephant in the room, and his policy has a fairly substantial fish-hook -- its price-tag: at least $314 million plus $43 million annually for a new prison to lock up the estimated 572 or so thugs that will be locked up under this policy who aren't locked up now.
That's why he gets just two cheers. Ignoring the obvious, and a new prison that's both expensive and unnecessary. Repairing to the reason we have laws against violent crime will tell you why it's unnecessary:
All actions defined as criminal in a free society are actions involving force—and only such actions are answered by force.
Do not be misled by sloppy expressions such as “A murderer commits a crime against society.” It is not society that a murderer murders, but an individual man. It is not a social right that he breaks, but an individual right. He is not punished for hurting a collective—he has not hurt a whole collective—he has hurt one man. If a criminal robs ten men—it is still not “society” that he has robbed, but ten individuals. There are no “crimes against society”—all crimes are committed against specific men, against individuals. And it is precisely the duty of a proper social system and of a proper government to protect an individual against criminal attack—against force.
Which means "crimes" without a victim are not in fact a crime -- "crimes," that is, such as smoking a joint, cutting down a tree on your own land, or putting a chocolate bar in your kid's lunchbox. Locking people up who've committed no crime against anyone else is not only immoral, its not only expensive, but it's urgently necessary to solve the problems Key seems at least to want to.
The main point here is of course the failed War on Drugs, whose results we can see on the streets of South Auckland and the gangs of Wanganui, in the increased profits of those gangs and the increased abundance of more and more dangerous drugs -- in the increased time taken away from real crimes by concentrating on bogus victimless crimes; in the rise and rise of 'P' -- the ideal prohibition drug -- and in the explosion of prison numbers in recent years.
It's now so serious that even a mainstream political parties really has to focus attention on what the War on Drugs has done, and how ending it will solve so many problems:
- End the War on Drugs to fix the gang problem, by taking away their source of profits.
- End the War on Drugs to fix the 'p' problem by taking away the need for such a *virulent* drug -- the ideal prohibition drug.
- End the War on Drugs to fix the prison overcrowding problem, by not locking up people who have committed no crime against anyone.
- End the War on Drugs to solve the policing problem, by taking police resources from so called 'crimes' with no victims so that real crimes with genuine victims like rape, robbery, murder, theft and fraud can be vigorously pursued and the rights of these real victims enforced and upheld.
BZP ban boosted the illegal drug market, survey shows - A survey of Otago University students has found the ban on party pill ingredient BZP has only boosted the illegal drug market. [Hat tip Whale Oil]UPDATE 2: Lindsay Mitchell reckons the Nats "two strikes" policy has gazumped her own party's "three strikes" headline policy. "Clever move by National," she says. "Makes ACT irrelevant on the very ground they chose to fight the election on."
Where ACT should have gone [she says] is to the root of most crime and the best way to prevent it: Serious and radical welfare reform. National would never follow them there.Thanks goodness one party at least has pointed out that road, huh?
But as Susan says at Lindsay's, why stop at two strikes?
I don't know why you'd subject another one (or two, in the case of ACT) innocent people to a serious [violent] offence before locking the offender away for a long time?As long as the justice system is fixed first and it's restricted to violent crimes only, why not?
Why not get serious with the first conviction for violent crime?
Ignorance abounds about both the cause of the present economic turmoil, and the way out of it. (I won't repeat my own comments on both, just check the archives.)
But perhaps the dumbest comments come from those who simply place their faith (and by that I do mean "belief without proof") totally in the expertise of Fed Governor Ben bloody Bernanke. Mike Moore for example in this morning's Herald, says:
Why will this not be like the Great Depression? The biggest difference is what policy-makers have learned. The President of the US Federal Reserve Bank, Ben Bernanke, did his economic thesis on the Great Depression.
But what have the policy-makers learned? And so what if Bernanke did his thesis on the Great Depression if he learned all the wrong lessons by it. How many academics do you know who are on the right side of any argument?
As an example of the former problem, Moore himself appears to have learned next to nothing. He seems to think that throwing gobs of government cash around pulled the world out of depression -- it didn't. He claims it's all about "confidence" and seems completely unaware of the real capital and real savings that those gobs of malinvested cash have been and will be consuming. And he appears to think that at "at the time of the Great Depression, there were few effective Government-owned central banks," when in fact the US Federal Reserve System, largely responsible for the crisis, was kicked off in 1913! (Moore compounds the error by claiming 'The Fed' was created in the thirties by Franklin Roosevelt, and that along with Fannie and Freddie and gazillions of dollars of phony "liquidity" it effected the recovery.)
Let's face it, the policymakers in power (or on the hustings looking for it) are no better than Moore, who no longer has any. As their answers on the economy indicate all too clearly, they really don't have a clue so they too place their faith in Bloody Bernanke.
But Bernanke has nary a clue either. He too seems to have formed the view that gobs of government cash are the answer -- and it's him who has control of the printing press. He has one tool, a printing press, and all he knows is he's going to use it, and you're going to pay for it.
The problem with putting all your faith in Bernanke and his friends is not that he's not smart -- he is -- it's that he's been blinded by a flawed economic philosophy.
If he's had his eyes open he would have seen some years ago how the product of his printing press were already causing wobbles -- just as they did in the twenties, with those wobbles eventually becoming a crash -- but the blinkers of his flawed economic philosophy blinded him to the facts then just as they do now, even when the likes of Ron Paul throws them in his face.
If he'd done his research without his Keynesian blinkers on, he would have seen that the 1929 crash wasn't caused by the Fed's deflation, it was made inevitable by the earlier monetary inflation that helped create the phony boom; and he would have noticed the recovery wasn't helped by the gobs of counterfeit credit being thrown around (in fact, that helped create a "depression within the depression" in 1937), but by the pool of real savings that canny workers kept and invested from their own earnings.
He might be smart, but his flawed economic theory just makes him another man without a clue about to lead us all into destruction.
In the latest of his seven-part series on the economic crisis, writer Jeff Perren continues his examination of The Naked Emperors with a closer look at the man to whom the faithful are now praying. But is there anything at all behind Bernanke's curtain?
So who else saw the Vice-Presidential debate on Friday? Some of you must have -- it rated more highly than last week's Presidential debate.
So if you saw it, what did you make of it?
For me it looked like the vacuous in pursuit of the venal -- and on every important issue in a very important election they were in agreement, and they were usually wrong : "corruption and greed on Wall Street" -- "more regulation" -- "We have got to clean up this planet" - "regulation," "regulation," "regulation."
My "Palin Bingo" and "Biden Bullshit" counters were both working overtime, but I think if I hear the word "Maverick" again I'm gonna scream. And just for your information, "maverick" in my dictionary is defined thus:
maverick, n. (N.Am) an unbranded beast; anything got hold of dishonestly; an irresponsible or independent person. v.t. to brand (a stray beast); hence, to seize or appropriate illegally.
I make absolutely no comment on the relevance or otherwise of that description to any of the candidates for the White House.
By the way, if you missed it and you have ninety minutes to spare, head to You Tube and type in "Palin" "Biden" "debate." You can find excerpts and even the full debate to spare.
Here's the campaign speech delivered last night by Mitch Lees, Libertarianz candidate for Annette King's electorate...Hello Rongotai!
Libertarianz are a party of optimists. We are glad that Helen Clark made trust a major issue of this election, as we are the only party that trusts you to manage your own life.
We know that Helen Clark is not better able to organise your family,
We know Michael Cullen is not better able to organise your money,
And we know the Green Party are not better able to organise your lunchbox.
Libertarianz fundamentally believes in small government and consistently promotes individual rights.
We strive to ensure that the government does not remain above the law.
I am standing as the candidate for Rongotai. Last year I organised the Wellington march against the anti-smacking bill. I did this – not because I had the desire to hit children - but because I saw it as a further intrusion of the government into the lives of all New Zealanders.
While this ludicrous bill was being debated, New Zealand was experiencing record murder rates. The Minister of Police and member for Rongotai dismissed this atrocity as being caused by phases of the moon.
Helen Clark blamed the recent murder of Navtej Singh on Navtej Singh himself, because (she said) he owned an alcohol store – or as she put it, a "dirty little grog shop."
She did not blame the perpetrator. She did not blame the years of welfare dependency that have destroyed South Auckland.
No place in the country gets more government money and interventions poured into it than South Auckland – yet no place in New Zealand has worse social statistics.
The only answer you will get from National, Labour or any other government party is more money, more programs, more social workers. And then they shut their eyes to the inevitable crime blow-out and blame it ….. on the weather. Or the moon.
Libertarianz will entrench the right to self-defence, get rid of welfare dependency and have real sentences for violent criminals that gets them off the streets.
Libertarianz will ensure that the police do not prosecute people for defending themselves, as happened as recently as last week.
And to free up police and prison resources for real crimes, Libertarianz WILL NOT pursue or prosecute victimless crimes.
After the last election it was discovered that the Labour Party had unlawfully used taxpayer money to fund its election campaign.
Libertarianz was the only party to challenge this rort. We took it to the High Court.
As our case seemed likely to succeed, the Labour Party's response was to pass retrospective legislation making the unlawful lawful.
This gross abuse of public trust must never be allowed to happen again. Libertarianz will ensure that the government must obey the same laws as its citizens.
Libertarianz are the only party that refuses to take taxpayer money for our election campaign. We also refuse to bribe you with your own money.
This afternoon, from the other politicians here, you are going to hear a lot of the word "Free." They sure don't mean "freedom." What "free" means in their mouths is … "Bribe!" Someone else has to pick up the bill for their promises, and that someone else is you –- the taxpayer.
Libertarianz key policies in this election and every election are to minimise government interference in your life. We have a fully costed budget which will mean your first $50,000 of income would be tax free, and all other taxes, including Government Slavery Tax, or GST, will be abolished.
Having your put your own money back in your pocket, you can then choose the best form and style of healthcare, education and superannuation -– customised to your needs.
You would not put up with 6 month waiting lists from your supermarket, why should you put it up with it from your hospitals? You would not patronise a system where you are restricted to the supermarket for which you are "zoned," which provides food both over-priced and inedible.
So why do you accept what the government presently doles out?
In countries where the government organises the food supplies – people starve.
In New Zealand where the government organises education and healthcare – we have 20% functional illiteracy, and over 1000 people die each year from medical misadventure.
No private organisation would get away with these atrocious results, yet when it is government you just accept it. It does not matter if it is a blue, red, or green government – there is no desire for real improvement.
The points to ponder that were handed out as you entered were written 6 years ago – and nothing since has changed.
And still nothing will change as long as parties stand up here wanting to control and spend your money, and you keep on electing them.
The parties you see up here should be ashamed of their consistent failure.
The current government has squandered eight years of economic golden weather. It continues to promote fear and ignorance as a means to maintain power.
Libertarianz will let you run your own life and get nanny state off your back. Although I am asking for your vote as the candidate for Rongotai and the party vote for Libertarianz, ultimately a vote for Libertarianz is a vote for yourself.
If you'd like to get stuck in helping Mitch in Rongotai, or your local Libz candidate in an electorate near you, then check out their contact details at Libz' candidate pages and get on to them ASAP.
A poem from the Great Depression, and tragically topical today, fom New Deal Ditties: or, Running in the Red with Roosevelt, 1936 (hat tip Noodle Food)
When "planned economy" first began
It looked like a swell "idea" –
Until we learned it had no plan
And wasn't economee.
For the taxes rise and the budget's shot
And the New Deal costs are met
By spending money we haven't got
For things that we never get.
The Billions roll in mighty stream,
A regular tidal flood,
With the net result that each spending scheme
Bogs down in a sea of mud.
When plans and programs go all to pot
Do the New Deal planners fret?
Why no, they think up a brand new lot
Of schemes to spend what we haven't got
For things we will never get!
Sunday, 5 October 2008
I like giving credit where it's deserved, and here's three business-people who deserve it.
If you're in the market for a truck, then Phil Pacey in Otahuhu is your man. For timber, you shouldn't go past Bargain Boards in Kopu. And for vinyl, there's Real Groovy in Christchurch, to whose manager I mentioned more than a year ago that I'd love to track down Phil Manzanera's 'Primitive Guitars,' a fine album I could only now enjoy on a deteriorating tape cassette, and on Friday a box arrived in the post -- a vinyl copy of the album with a note saying "A wee something for you."
So for service above and beyond, etc., these people deserve all the praise I could muster. Thanks to you all. :-)
The Audio Books site is offering punters a free Ayn Rand audio book. How cool is that!
Choose one of either Philosophy: Who Needs It?, The Virtue of Selfishness, or Atlas Shrugged, which would be a very long listen indeed -- although as this YouTube presentation using the Atlas audio book indicates, a damn good listen.
Just the sort of thing you'd want to listen to while touring the country by Winnebago.
UPDATE: My spies tell me the book is free only if you cancel your order within fourteen days of downloading. So be careful out there.
Many of the more sober critics of the US government's bailout package have realised the present economic turmoil is not a failure of capitalism, it's a failure of government, but they've still failed to get their head around the fundamental cause of the crisis, or of the bubble that set it off.
They've talked about Smart Growth and the dictatorship of the planners that locked up land and sent housing prices soaring in the more planned markets, but they haven't realised that it only 'directed' the inflationary bubble into housing; it didn't directly cause the bust.
They've talked about the complications of bundled securities that leave even the organisers of those securities clueless as to what they're really based on -- but they haven't understood that this was just a way bankers chose to deal with the flood of easy credit coming down the pike'; and they haven't yet understood that it was the flood of easy credit that was the primary problem.
They've talked about Jimmy Carter's Community Reinvestment Act and "community organisers" like Barack Obama who pushed indigent non-payers into sub-prime 'first-home,' 'easy credit,' 'low-doc' loans, without realising that without the flood of government credit, the number of sub-prime loans being made would have dried up like a pub without beer.
They've talked about Fannie and Freddie, which since 1938 (in the case of Fannie) have been accidents waiting to happen, but they've failed to notice that up until the latest blow out the accidents have only been small.
Each of the proponents of these points is correct in their analysis, at least as far as they go, but in ignoring all the other factors involved they don't go far enough, and in ignoring the more fundamental explanation -- that we've been floating a sea of counterfeit capital fed by a spigot of paper money, and jacked up by a fractional reserve banking system that "leverages" those paper dollars to turn the flood of paper into a tsunami, and every dozen years or so when the spigot is eventually turned off, we see another crisis -- the bubble blows out the same every time, it just blows out in different places.
As Hans Sennholz points out, the fundamental cause of the problem goes back several decades, nearly a century, all the way back to 1913, and the creation in the United States of "the Federal Reserve System," which was never anything but "a creature of politics."
It sprang from the most revolutionary single piece of legislation in American currency and banking history, the Federal Reserve Act of 1913. It meant to improve the earlier financial system created by the National Banking Act of 1863 which placed the federal government in the very center of American money and banking. Both Acts were designed to reform the market order which was deemed to be unstable and unresponsive to the needs of the federal government and the national economy.
Actually, they constituted early steps toward a hybrid fiat system which in time spread to all corners of the world. It is neither a command system in the manner of radical socialism nor a market order on a gold standard; it probably is the most unstable financial system conceivable which no human being, no matter how brilliant and distinguished, could manage satisfactorily.
The American money and credit system now resembles an inverted pyramid that rests on legal-tender Federal Reserve notes and credit. These support various forms of bank money such as commercial bank deposits, savings accounts, large time deposits, and other liquid assets. The base of some $672 billion may expand rather moderately, presently at some 6 percent a year or $40 billion; the layered superstructure of $8.333 trillion bank money (M3) may grow at a similar rate or $529 billion (as of 10/23/2002). Commercial banks tend to "securitize" their loans, converting them into marketable securities for sale to investors which enables them to grant new loans in a continuing process of lending, securitizing, selling, and lending again.
Massive non-bank credit constitutes the upper layers of the money pyramid; there are Federal Home Loan Banks, thrift institutions, life insurance companies, brokerage firms, mutual funds and other credit grantors. Last but not least, offshore banks in the Bahamas, the Cayman Islands, Panama, Hong Kong, and Singapore, enjoying favorable regulatory and tax treatment, provide the top layer of the multitrillion dollar money pyramid. And high above the American pyramid hovers the international pyramid which builds on the U.S. dollar standard.
The Chairman and his fellow governors are expected to balance it all with their high-powered Federal-Reserve-dollar base. They are expected not only to manage this monstrous pyramid of fiat money and fiduciary credit but also to safeguard the stability of the American economy, to maintain asset prices, protect the value of the dollar, and avoid the business cycle. They are supposed to manage a monstrous structure which politicians built for their own use and glory. That's too much to ask of any mortal.
You see, even if they had a clue, it would still be impossible.
Friday, 3 October 2008
A week of crime, violent crime and assorted financial crimes -- most of them emanating from the US Congress. And another big week here at NOT PC in both readership -- for which I humbly thank you all for coming (would have been awfully lonely if no-one showed up) -- and analysis -- which I humbly think was pretty damn good this week. Here's what you, the readers, seemed to like most:
- Murder? It's not OK.
It's murder out there on the streets of Auckland, but some commentators insist it's nothing to worry about ...
- Time to make a stand!
So what will it take for politicians to focus on the focus on the one thing they're legitimately supposed to be doing, which is protecting New Zealanders from violence? The question is more than just rhetorical.
- Good news: The 'bailout' has crashed
And thank fuck for that! Quite aside from the absolute irresponsibility of printing $700 billion of bailout cash to further inflate the money supply -- more of the same rocket fuel that caused the problem in the first place -- the plan to keep prices high is precisely the opposite of what's needed in a depression.
- Borrowed time - the anatomy of recession
Somebody has blundered, and we'll all be paying for it again, but who and how and why?
- Don't Vote Green
Allow me to direct you to a valuable new election website...
- "For the naive mind there is something miraculous in the issuance of fiat money..."
As if he too were writing yesterday, economist Ludwig von Mises has advice for those contemplating the imminent nationalisation of Wall St's debts via one trillion dollars of printed money.
- More bailout crack
Just when you thought that the bailout crack might have been put back in the box, we hear that the bastards are setting up to deliver another fix. A trillion-dollars straight into the veins.
All this, plus being damnably insulted as a "centre-right" blogger. Outrageus!
Enjoy, Peter Cresswell
On this fine Friday avo in our regular Beer O'Clock post, reflections on beers past from Real Beer's Neil Miller:
I had never seen an empty beer can used a prop at a political science lecture before. Professor Stephen Levine from Victoria University of Wellington was using a thirty-year old can of Billy Beer to make the point that even the President of the United States of American cannot choose his family.
Billy Carter was a constant embarrassment to his brother one-term President Jimmy Carter. Despite promoting “Redneck Power” pickup trucks, Billy is best known even today for the beer that briefly carried his name.
Billy Beer was launched in 1977 by the Falls City Brewing Company. Although the can states that the beer was “brewed expressly for and with the personal approval of one of America's all-time great beer drinkers - Billy Carter,” Billy himself had no input into the design of the beer. He was selected as the spokesman because, frankly, his brother was the President and Billy was already very well known for enjoying his beer.
The beer was actually produced by four different breweries in the seventies – Falls City Brewing Company, Cold Spring Brewing, West End Brewing and Pearl Brewing Company. Around 2 billion cans were produced so even today the cans are not as nearly rare as people think.
They are so common that the Brewery Collectables Club of America – who should know about these things – note “most of these [1970s] commemorative cans are still incredibly abundant and virtually worthless, most notably the ubiquitous Billy Beer.”
While there are frequently adverts offering to sell Billy Beer for hundreds or even thousands of dollars a can, the experts warn that these are basically fraudulent. Billy Beer sells for around US50c to a couple of dollars on eBay but the actual value to a collector is probably around 25c but only if it is in good condition and the collector – for some reason – really wants one.
So, all those people who were hoping that old sixer of Billy in the basement was going to see them through retirement should probably consult a financial planner. Billy Carter should have done that– after Billy Beer collapsed, he had to sell his home to settle the back taxes he owed the IRS.
There's been a whole lot of bullshit written about National's policy on the Resource Management Act, released this week -- "National plans big changes to RMA" -- "National's National's RMA reforms will get business moving again" -- "Nat's RMA reforms endanger environment" -- but this morning for the first time I see some sensible commentary on their risible policy prescription: National's RMA Buzzword Bullshit.
National's Resource Management Act policy, released this week, is more than just a missed opportunity to help a parlous economic outlook: it almost amounts to a confidence trick.
While the world economy reels on the back of central-bank bungling and serious problems in the American housing sector, and as local building activity takes a nose-dive - building consent numbers are down by a third - a political party truly 'ambitious' for New Zealand might have grasped the opportunity to help an ailing economy and a struggling housing sector by releasing a bold new Resource Management Act policy that would take the weight of the RMA from the shoulders of struggling builders, home-buyers and property-owners.
But that is not what National's Nick Smith has served up. Smith's policy overflows instead with buzzwords like 'fix', 'streamline', and 'get business moving', but closer scrutiny demonstrates Smith's large print giveth, but his small print taketh away."
Read on here, and don't be too surprised the commentary is so sensible: I wrote it. ;^)
I've been a little surprised that George Reisman hasn't commented at his blog on all the recent financial turmoil, but the more I read the more I wonder whether he's simply resisting the urge to say "I told you so" -- because he has.
So let me do it for him by republishing just some of what he's had to say.
Back in his 1996 book Capitalism he summarises what we've seen happening these last few years -- the boom -- the prosperity delusion -- using your house like an ATM -- the "reversal of safety" -- the malinvestments -- the destruction of capital ... and then the inevitable bust -- the decline in stock markets -- the credit crunch -- the collapse of local finance companies as their "business model" failed -- the decline in commodity prices -- the credit crunch again -- the onset of depression -- and the cause of it all ... the inflation of credit over recent years.
What he's describing is an "inflationary depression," something in which we're already up to our frilly knickers. It's not a failure of free markets, as Roger Kerr says that idea doesn't even pass the laugh test, it's a failure of politicians and policymakers to understand the damage their intervention does to markets.
It's a shame so many mainstream economists still don't get it -- in fact, as Reisman and other students of Ludwig von Mises have pointed out for many years, they've largely been the cause of the problem.
Mainstream economists, and mainstream commentators like the risible Brian Fallow, think all will be well just as long as the credit spigot at the central bank remains turned on -- but they're never truly understood where credit actually comes from, which is real savings. Their ignorance is a result of the total failure of mainstream economics to integrate their "microeconomics" and their "macroeconomics," leaving theories about the latter floating about in the breeze like a hydrogen-filled balloon just waiting to catch light and spray destruction over real economic activity.
For anyone who wants to get their head around the crisis that will define the next decade, I urge to you get your head around what economists like Reisman have been saying for years, some of which I've reprinted below from his book. For Reisman's whole discussion I recommend Chapter 19 of his book, 'Gold & Inflation' [the whole book is online at George's website ], of which the section below is the most directly topical to current events -- and remember that "inflation" as accurately used here by Reisman means not the symptom of across-the-board price rises, but the cause of those rising prices: a rise in the quantity of money, usually because the central banks have had their printing presses running again.
Printed money is backed by nothing more than the goods that already exist, and every new dollar lies as a claim on future production. It acts as a drain on real capital formation. The more money that's printed, the more capital formation is eroded -- the signs are there for many years for anyone who knows what they're looking for (see for example Misesians Mark Thornon, Stefan Karlsson, Anton Mueller, Thorstein Polleit (and again), and Robert Blumen). The first public sign of the inflation-induced collapse of the bubble appears in the stock market -- this is also the first time mainstream economists realise there's a problem, and it's cause by the effects of the inflation itself:
The fact that inflation undermines capital formation has important implications for the performance of the stock market. In its initial phase or when it undergoes a sufficient and relatively unanticipated acceleration, inflation in the form of credit expansion can create a
stock-market boom. However, its longer-run effects are very different. The demand for common stocks depends on the availability of savings. In causing savings to fail to keep pace with the growth in the demand for consumers’ goods, inflation tends to prevent stock prices, as well as wage rates, from keeping pace with the rise in the prices of consumers’ goods...
At some point in an inflation, business firms that are normally suppliers of funds to the credit markets—in the form of time deposits, the purchase of commercial paper, the extension of receivables credit, and the like—are forced to retrench and, indeed, even to become demanders of loanable funds, in order to meet the needs of their own, internal operations. The effect of this is to reduce the availability of funds with which stocks can be purchased, and thus to cause stock prices to fall, or at least to lag all the more behind the prices of consumers’ goods.
When this situation exists in a pronounced form, it constitutes what has come to be called an “inflationary depression.” This is a state of affairs characterized by a still rapidly expanding quantity of money and rising prices and, at the same time, by an acute scarcity of capital funds. The scarcity of capital funds is manifested not only in badly lagging, or actually declining, securities markets but also in a so-called credit crunch, i.e., a situation in which loanable funds become difficult or impossible to obtain. The result is widespread insolvencies
The other result is the sight of mainstream economists running around with their heads cut off attempting to explain what, to them, is inexplicable: a "credit crunch" when the central banks' credit spigot is still pumping out paper (more than two-trillion dollars worth in recent weeks). You see, eighty years after the first central-bank-induced inflationary depression, they still don't understand the cause of that one, or yet the cause of this one. See if Reisman's description of the process sounds familiar:
Inflation as the Cause of Depression & Deflation
Inflation, especially in the form of credit expansion, sets the stage for financial contractions and deflations— i.e., for depressions. It does so in several, related ways.
It undermines the perceived need and the desire to own money balances. As a result, it causes a more rapid spending of money ...
[This occurs] in large part because credit expansion creates the prospect of being able to obtain the money needed to make purchases and pay bills, easily and profitably through borrowing. The prospect of loans manufactured out of thin air by the banking system is
substituted for the holding of actual money...
These mechanisms are reinforced by the fact that after a while inflation -- even in the form of credit expansion -- raises interest rates...
The other side of spending, of course, is people’s revenues and incomes, since one man’s spending is an-other man’s receipts. Obviously, in superinflating the volume of spending in the economy, inflation also super-inflates people’s revenues and incomes.
Inflation also does something else. It encourages people to pile up a mass of debt that they can pay only so long as their revenues and incomes hold up—indeed, only so long as their revenues and incomes go on increasing. Inflation in the form of credit expansion encourages
borrowing by holding down the rate of interest in relation to the rate of profit. It makes borrowing exceptionally profitable; and the more so, the more leverage the borrowing
Sounding familiar so far? Just to summarise: inflation of credit, ie., of the money supply, "does two critical things. It super-inflates people’s revenues and incomes, while making them correspondingly illiquid, and it leads them to pile up substantial debts against those revenues and incomes."
Now, let's bring on to the stage both the banks and the bailout, and the reason bankers and Ben Bernanke have been losing their hair, and their shirts:
This alone must set the stage for a depression if and when inflation [of the money supply] stops. Because then the causes of the reduced demand for money balances are removed. At
that point, people start trying to rebuild their cash holdings. As a result, spending and the velocity of circulation fall, with the further result that people’s money revenues and incomes fall. The effect of this, in turn, is that they cannot pay their debts. A substantial number of business and personal bankruptcies occurs.
The consequence of this, of course, is that the assets and capital of banks which have lent to such borrowers is correspondingly reduced, and many of them also fail. The failure of banks, of course, causes the money supply actually to be reduced, since [in fractional reserve banking] the banks’ outstanding [current account] deposits are part of the money supply. The reduction in the money supply then leads to a further decline in spending, revenue and income, and thus to still more bankruptcies and bank failures. The process feeds on itself ... The reduction in the quantity of money can be avoided only if the government is prepared to create additional fiat standard money to whatever extent may be necessary to guarantee the fiduciary media of the
failing banks. But this lays the foundation for a still greater expansion in the supply of fiduciary media in the future.
And so we hear the cry, 'Bring on the bailout!' In other words, more of the same poison that caused the problem in the first place: more paper money pouring off the government's printing presses. The whole process is like a giant pyramid scheme, with the pyramid inverted and resting on that printing press in Ben Bernanke's basement. "This," says Reisman, "is the essence of the inflation-depression process. The critical factors are: artificial inducements to illiquidity and to a corresponding superinflation of revenues and incomes; the piling up of a mass of debt against these superinflated revenues and incomes; and then a contraction in spending, revenues, and incomes following the
end of the inflation. The contraction phase leaves people with no means of paying the mass of debt they have accumulated, and can operate to produce a self-reinforcing downward spiral of deflation of the money supply."
The inflation-depression process is reinforced by the fact that inflation in the form of credit expansion causes malinvestments—investments which are profitable only on the basis of inflation itself. When the inflation comes to an end, the unprofitability of the malinvestments is
The onset of the depression is precipitated by the fact that inflation and credit expansion undermine the avail-ability of real capital and thus of credit, too, in real terms.
In particular, when credit expansion stops, a “credit crunch” develops. This is because the existing capital funds of many enterprises are made inadequate by the rise in wage rates and materials prices caused by the previous injections of credit in the form of new and additional money. The consequence is that firms requiring credit turn out to need more credit than they had planned on, while those firms normally supplying credit turn out to be able to supply less than had been counted on, and may even need credit themselves in order to meet the requirements of their own internal operations at these higher wage rates and prices. Thus, as the need for credit surges and as suppliers of funds become demanders of funds, or at least supply less funds, firms that had counted on borrowing money, or on refinancing their existing
borrowings, find that they are unable to do so.
It's not that "credit has dried up" from the central banks as so many contemporary reports would have you believe -- see Jeffrey Tucker's graphs and Rebert Higgs' report at The Independent Institute exploding this particular myth -- it's just that so much of that credit is now needed to fuel the daily fires of business, to just keep the accounts books ticking over, that little is left for the likes of Craig Norgate to effect Wrighton's merger with Silver Farms.
Nonetheless, we're going to see "credit crunch" after "credit crunch," as the amount of credit needed top keep those account books ticking over only keeps increasing as the emergency measures keep accelerating; you could almost say a "credit crunch spiral":
These results can occur not only when inflation [of the money supply] stops, but also when it merely slows down or even when it fails to accelerate sufficiently. To postpone the onset of a
credit crunch, it becomes necessary to provide the victims of previous credit expansion with additional funds, in order for them to be able to pay the higher wage rates and materials prices caused by the previous credit expansion.
Then still further inflation and credit expansion become necessary in order to overcome the resulting inadequacy of the funds of still others, possibly including the funds of the initial recipients of credit expansion, who perhaps are now themselves faced with unexpected in-creases in wage rates and materials prices. If at any point, the necessary additional credit expansion is not forthcoming, a credit crunch develops. If it is forthcoming, people soon begin to borrow on a larger scale, in anticipation of the possible inadequacy of funds in the face of
higher wage rates and materials prices. If that additional demand for loanable funds is not met by still more credit expansion, the result is a credit crunch at that point. If it is met by still more credit expansion, the result is a still greater increase in wage rates and materials prices, which nullifies the value of the greater borrowing and requires still more credit expansion to avoid the onset of a credit crunch. Whenever the necessary additional credit expansion
is not forthcoming, some firms find that they lack the funds they require, and thus [another] credit crunch develops.
Now, you might object that wage rates and material haven't been rising, so Reisman's analysis is incorrect. But as he explains, "it should be realized that in order to produce a 'credit crunch' and the onset of a depression, it is not necessary that credit expansion result in an actual rise in wage rates and materials prices. It is necessary only—as is inescapable—that it make wage rates and materials
prices higher than they would otherwise have been. If wage rates and materials prices fail to fall, or fall by less than they would otherwise have done, the effect is still to render existing capital funds less adequate than they would otherwise have been and to create a need for more capital funds than would otherwise have been the case." Let me just repeat the crucial lines above describing our present situation, the beginning of an “inflationary depression.”
This is a state of affairs characterized by a still rapidly expanding quantity of money and rising prices [that is, rising ahead of what they would be without the credit inflation] and, at the same time, by an acute scarcity of capital funds. The scarcity of capital funds is manifested not only in badly lagging, or actually declining, securities markets but also in a so-called credit crunch, i.e., a situation in which loanable funds become difficult or impossible to obtain. The result is widespread insolvencies
Remember, this was written in 1996. It must take a manful effort for Reisman not to say "I told you so" ... but he did.
In the 1902 Ward Willits House, Frank Lloyd Wright first found his full three-dimensional voice. It's ground-hugging horizontality reaching for the horizon; the entrance that 'winds in' to the centre of the house; the low sheltering roofs springing from the central vertical core; the 'pinwheel' spaces revolving out around the hearth ... this was a revolutionary new form of space and domestic architecture not seen before, patterns that would be seen in most of his 'Prairie Houses' for the next ten years.
The perspective above was drawn by his talented delineator Marion Mahoney.
Thursday, 2 October 2008
You've probably heard that NZ singer Rob Guest died this morning in Melbourne of a stroke. I never saw him sing live, but by all accounts he was a fearsome Valjean in one my favourite musicals, Les MIserables.
So as a tribute, not by Guest himself unfortunately, here's a YouTube excerpt from the Finale of Les MIserables, sung at the death of Valjean. It's a real tear-jerker. (For maximum effect, click on the clip 'Les Miserables. Final Act II. 10th Anniversary Concert' immediately the first clip finishes).
They're doing it again.
Just when you thought that the bailout crack might have been put back in the box, we hear that the bastards are setting up to deliver another fix. A trillion-dollars straight into the veins.
describes how the Fed has already poneyed up more than the $US700 billion bailout plan in the past week for an emergency-lending programme for banks, swap lines with foreign central banks to help money markets from Europe to Asia, and the cost of propping up AIG and other institutions.
The Times says there is “more money where that came from,” citing sources that say the Fed could add debt of $US1-2 trillion...
That's nearly three times higher than the present bailout plan -- a sum almost equal to all the loans currently extant in the United States [see charts here]! For what? To delay the necessary correction -- one of the reasons the 1930s depression dragged on for so long -- and to keep prices from falling that desperately need to fall -- one of the other reasons the 1930s depression dragged on for so long.
And to delay it by means of the same method that inflated the boom, leading inexorably to the bust: printing more money, as if pieces of printed paper over which the Fed has waved its magic wand are in and of themselves able to turn stones into bread, and toxic bank reserves into solid capital.
I got a phone call the other day asking me to come and talk to a group of people about the causes and implications of the present financial turmoil. "I'm no expert," I demurred, and my caller replied, "Neither are the bastards who caused it." Good point. And the bastards who caused it are still doing their best to make it worse.
UPDATE 1: Reports are in that the dumbarses in the Senate have voted in not just Bailout II, but Bailout II with Extra Pork. Pork with dripping, A package totalling for every wallet in America.
So that's more pork, more credit made up out of thin air, and all with the result of putting off the inevitable pain of correction for ... another few weeks.
And next time the fix will need to be even stronger.
UPDATE 2: This is not a bailout package, says Robert Murphy writing before today's decision, it's a crime scene.
This is not an economic plan: it is a heist.And since there's no real money created here (reality doesn't allow real money to be created out of thin air) someone has to pick up the tab. Guess who?
It will go down as The Great Bank Robbery of 2008.
The economics behind it are nonsense, but we are naïve if we spend much time even considering the "arguments" for it. This is a money and power grab, pure and simple.
Just as magazine covers today feature scantily clad women that would have been scandalous a generation ago, in the same manner Paulson's proposal — made in broad daylight and on national TV! — is almost naked in its audacity.
It is the crudest Keynesianism to view the Paulson Plan as an injection of capital or "liquidity." That money has to come from somewhere. If it is taxed or borrowed, then it is just a shell game; the liquidity is drained from elsewhere, to be injected into Wall Street.And as for talk of "a breakdown" in the financial system without a bailout, this too is a bogeyman, says Murphy. "Just because the banks disappear doesn't mean [genuine] lenders will."
Besides taxing or borrowing, the government has a trump card: it can have the Federal Reserve simply create the new money out of thin air, by engaging in some "Open Market Operations." Yet even in this case, real wealth still hasn't increased. Certain nominal figures, like "aggregate asset values" might go up. But that's not very relevant, because the economy isn't really richer. After all, there aren't more tractors or office buildings just because Bernanke allows the monetary base to grow more rapidly. So what happens in this case is that prices rise; people find it harder to buy milk, bread, and gasoline. But the Wall Street fat cats are fine with the general price hikes, because they got their hands on the newly injected funny money early in the game
I posted yesterday a link to one site set up to ensure sure you're armed with the necessary intellectual ammunition to understand and appreciate the cause of the present economic turmoil, the cure, and the means by which it can be prevented from happening again. The Ayn Rand Center for Individual Rights' new Web page defends a very different view from the interventionist mainstream—that the actual cause of the crisis is government intervention, and the only cure, laissez-faire capitalism. Check out their collection of essays, op-eds, lectures, and interviews arguing for a rational approach to this crisis—an approach you will not find anywhere else.
And today I can point you to another comprehensive site offering a rational approach to understanding the causes and the cure, and the people who saw it coming: the Mises Institute's Bailout Reader, with readings that thoroughly and clearly dissect:
- Fannie Mae & Freddie Mac
- The Housing Bubble
- Inflationary Finance
- Community Reinvestment Act
- Short Selling
- The Reasons for the Business Cycle
- Who Predicted This?
- What to Do?
- Books to Read & Distribute (most of them available free on PDF)
Don't accept the lies and untruths about the crisis promulgated by statists who wish to use it to promote more government intervention, or by the time-servers whose economic theories were responsible for it.
Instead, I thoroughly recommend these two sites whose rational commentary will arm you, educate you, and thoroughly debunk the nostrums and 'bailout crack' presently being peddled -- and without the lies, self-serving nonsense and bloody jargon that infests so much of the other commentary I've been reading.
Another good month here at NOT PC, a month in which Sarah Palin emerged from Wasilla, Malaysian bloggers were submerged under the Internal Security Act, New Zealanders were overwhelmed by violent crime, I was underwhelmed by Fiji Bitter ... oh yes, and I believe someone here said something about an election. Here's some of the main stats for NOT PC last month:
NZ Political Blog Rank for NOT PC: 7th (August, 6th)
Alexa Ranking, NZ: 577th (last month 687th)
Alexa Ranking, world: 255,965th (last month 252,163rd)
Avge. Monday to Friday readership: 1345/day (1091)
Unique visits [from Statcounter] 39,618 (30,481)
Page views [from Statcounter] 59,647 (47,029)
Top posts this month:
- "Lock up the bloggers!"
- Sarah Who?
- Wake up, warmists!
- Murder: It's NOT OK!
- Time to make a stand!
- The phenomenenal is disconnected from the noumenal
- FIJI: Just scratching a living in paradise
- PALIN: Two speeches
- Sensing bullshit
Top referring sites:
Search engines 3421 referrals; Rocky's Bru, 1762; Kiwiblog 1428; No Minister 1243; Libertarianz 641; Whale Oil 367; NZ Capitalist 250; Chris Trotter/Mathew Hooton 198; Liberty Scott 195; Lindsay Mitchell 178; RealBeer 162 AntiDismal 151; Public Address 144; Tumeke 144
Top searches landing here:
not pc 448; nude olympians 359; broadacre city 74; sean fitzpatrick libertarian nz 48; heineken mini keg 43; crypto-individualist 40; nipcc 40; elijah lineberry pinochet 38; beer songs 36; greens ban word appears site 30; bavinger house 25; christus hypercubus 25; william van allen 25
They're reading NOT PC here:
Top countries/territories (measured this month by Google Analytics):
NZ 46%; USA 23%; Malaysia 5.5%; Australia 4.3%; UK 4.0%; Canada 2.1%; Germany 1.2%; India .9%; Italy 0.9%; Brazil 0.7%; Singapore 0.6% (and not one visitor from the proud state of Alaska).
Top cities (measured by StatCounter):
Auckland 30%; Wellington 7.7%; Christchurch 4.8%; Kuala Lumpur 3.0%; Sydney 2.3%; London 1.5%; Palmerston North 0.9%; Hamilton 0.8%; New York 0.6%; Tauranga 0.6%; Brisbane 0.6%Readers' Browsers
IE Explorer 45%; Firefox 43%; Safari 7.6%; Opera 2.3%; Chrome 1.5%
Readers' Connection Speeds
Unknown 37%; DSl 35%; Cable 17%; T1 8.0%; Dial-up 3.6%
Cheers, and thanks to you all for reading and linking to NOT PC this month,
And it was pictures such as these from Wright's 'Wasmuth' portfolio, published in Europe in 1910, that inspired a new generation of young European architects to take the scales from their eyes and the artifice from their work and learn to make their architecture sing.
Cactus just insulted me. She called me a "centre-right" blogger.
I'm outraged. "There is no higher insult!" [See Rection E., 'Harden Up,' ed. Woody H.O., Feb. 1998]. I fancy pistols at dawn.
Apparently there's such a thing as "a centre-right blogosphere." People subscribe to that slop. Fancy people trying to make the world safe for the centre-right! What sort of people would waste their life on such an enterprise?
Wednesday, 1 October 2008
America's historic economic crisis is no less a crisis for us. A new web-page offers some answers on cause, effect and prevention:
What was the cause? What is the cure? How do we prevent it from happening again?
While pundits and politicians blame the current housing and financial crisis on "greedy" businessmen and lax regulators, and are frantically urging the government to expand its control over our economic lives, the Ayn Rand Center for Individual Rights has launched a new Web page to defend a different view—that the actual cause of the crisis is government intervention, and the only cure, laissez-faire capitalism.
We invite you to check out our collection of essays, op-eds, lectures, and interviews arguing for a rational approach to this crisis—an approach you will not find anywhere else.
Visit and have your myths exploded. As the Ayn Rand quote at the top of the page says, "
"One of the methods used by statists to destroy capitalism consists in establishing controls that tie a given industry hand and foot, making it unable to solve its problems, then declaring that freedom has failed and stronger controls are necessary."
And they're doing it again. Make sure you're armed with the necessary intellectual ammunition to counter the latest statist ruse.
PJ O'Rourke has been diagnosed with cancer. Ted Kennedy has cancer of the brain; PJ has cancer of the arse -- appropriate for both, he suggests.
I have, of all the inglorious things, a malignant hemorrhoid. What color bracelet does one wear for that? And where does one wear it? And what slogan is apropos? Perhaps that slogan can be sewn in needlepoint around the ruffle on a cover for my embarrassing little doughnut buttocks pillow.
It might not be fatal.
I'm told I have a 95% chance of survival. Come to think of it -- as a drinking, smoking, saturated-fat hound -- my chance of survival has been improved by cancer.
National's Nick Smith released National's Resource Management Act policy yesterday. Smith said within 100 days of forming a new government National would introduce a bill to "streamline" the Resource Management Act.
Responding for the Greens, co-leader Russel Norman says "the National Party's plans to reform the Resource Management Act are a misguided 'business-first, community-second, environment-last' policy:
Dr Norman says National's RMA gutting will undermine New Zealanders' ability to protect our environment..."
Actually, they're both wrong -- although they both gain politically by the ruse.
- At the moment the RMA removes from property-owners rights over their own land, including the common law right of recourse over pollution by neighbours or downstream polluters.
- It locks up land around the country's major cities, jacking up the price of new housing for new home-buyers.
- It gives large polluters a "license to pollute" -- meat processors to dump their wastewater into rivers and oceans; farmers, pulp and paper mills and landfill sites to discharge their waste (with a license to pollute gifted to them by the RMA) into lakes and rivers; a developer to dump sewage effluent directly into an ocean outfall at Akaroa with no recourse in law for those polluted by such discharges.
- And the lengthy delays and seemingly arbitrary basis on which consents are granted makes it virtually impossible for producers to plan ahead, adding huge costs to every new project.
'Smith's dream' does nothing at all to address these serious problems, on top of which he wants to introduce two new bureaucracies -- an Environmental Protection Agency to make things even more restrictive, and a toothless "independent complaints mechanism" to give the appearance that someone gives a shit when the council stuffs you around.
The guy's a fool.
Smith's on record as calling the RMA "far-sighted environmental legislation" -- it isn't.
Remember that Smith had three years as minister in charge of the RMA back in the nineties to change things -- he didn't.
He promises nothing fundamental now, either. The policy overflows with buzzwords like "fix," streamline" and "get business moving," but closer examination demonstrated Smith's large print giveth, but his small print taketh away.
Does he promise to put protection of New Zealander's property rights at the heart of the Act? No.
Does he promise to take power over your property away from planners and council bureaucrats? No.
To make it easier for a builder to get a subdivision consent and lower the price of land to buyers?; or for a supermarket owner to build a new supermarket in the face of a competitor?; or a developer to build a new village in the face of council opposition? No, of course not -- not when you read the fine print.
Will they abolish the likes of development levies, and squash the huge delays and rises in consent costs that add thousands, and sometimes millions, to every private project in the country? No, of course they won't.
Will they do anything at all to increase the supply of suitable land available on which to build houses, or to remove council planners the power to zone private land, and the power to set urban walls around New Zealand towns and cities? No, emphatically not.
Not one of these things will happen under National. Here's what they promise instead:
"We want to get business moving again by addressing the needless bureaucracy that is frustrating so many homeowners, farmers, and businesses, and to enable New Zealand to get on and build much-needed infrastructure," he says.
Well adding a new bureaucracy is hardly a good start, is it? And since there's nothing here to kill off planners, consultants and the sundry other needless parasites who leech off the Act and destroy enterprise, there's hardly cause to celebrate. (And don't forget, National have their own Emissions Trading Scheme to roll out as well, and don't think you'll be seeing any details of that before you go into the polling booth in November.)
National supports the underlying principles of the Resource Management Act...
The underlying principles of the RMA uphold the toxic collectivism of kaitiakitanga - or stewardship - while completely ignoring property rights; they uphold the nonsense of 'intrinsic values' while destroying distinctively human values; they tout 'effects-based planning' while prescriptively regulating and prohibiting human activities; they have empowered an enormous army of consultants to interpret and manage it; they protect trees, rocks and mud puddles while providing no protection for human life; they "protect" "future generations" while making it virtually impossible to build the infrastructure these generations will need. The RMA fails to even mention property rights in its 455 pages, while harbouring a savage penalties regime of fines up to $200,000, and up to two years in jail!
These are the underlying principles that the National Party supports.
National will simplify the Act by limiting the definition of environment to natural and physical resources...
Hardly a king hit to bureaucracy and red tape, just a very small baby step that consultants will very quickly learn to exploit.
... and prohibiting objections with respect to trade competition.
The Act already prohibits trade competitors using the RMA to stifle competition. But as North Shore supermarket and shopping centre owners will know, it hasn't stopped them using proxies.
We will also reduce the number of consent categories ...
But the increase in the number of consent categories has made consent applications easier (if only slightly); reducing them is going to make applications harder, not easier.
...replace the broad reference to Treaty principles with specific requirements for iwi consultation...
Which means the present vague references to consultation over taniwhas will be replaced with explicit demands for consultation over taniwhas.
...and remove the ministerial veto on coastal consents.
Which will be retained for much of the northern North Island in the Hauraki Gulf Marine Park Act, introduced by Smith in his previous term as minister.
The ministerial veto on coastal consents adds time and unnecessary uncertainty to applications. This was emphasised by the political interference of the Conservation Minister in the Whangamata Marina.
And as this dickhead is well aware, the Conservation minister's political interference with the Whangamata Marina -- and with the Whitianga Waterways -- was necessitated by his own Hauraki Gulf Marine Park Act. The man has a tongue so forked he could hug a tree with it. What else does he promise with it?
Tens of thousands of people every year apply for smaller consents and are frustrated by breaches in statutory processing times, excessive fees, and unreasonable requests for further information from consenting authorities The bill will provide an independent complaints mechanism for these issues, where there will be a power to discount or waive consent-processing fees where statutory processing times are breached.
This is about as attractive as a chocolate-coated turd; it looks almost edible until the sugar coating is removed.
Councils are already adept at asking pathetic and irrelevant questions to extend the nominal twenty-day limit they have for considering resource consent applications without the delays being recorded as such; Smith's proposal just invites more of the same ruses.
An "independent complaints mechanism" won't make consents arrive any earlier, or save anyone any money: instead we'll simply have yet another useless bureaucracy, while applicants will be assailed by councils processing their consents with even more stupid and irrelevant questions than they do now just to justify them "stopping the clock."
And although it's hard to image how much more stupid some of those questions can get, it's clear enough that the stupid questions will increase under Smith's stupid proposal. That he wants to hang his hat on this is a sign of how little he really understands the Kafka-esque problems with making and receiving Resource Consent applications.
The bill will simplify the process for councils amending and updating their plans... We will encourage regional and district councils to develop a single plan.
Irrelevant window dressing.
We will also encourage greater use of the Internet to replace onerous paperwork requirements.
Even more irrelevant window dressing.
We will provide for a system of approved contractors in areas like tree trimming to reduce the number of minor consents required.
Jobs for the boys.
And now, with the window-dressing out of the way, we come the crux of National's RMA policy -- at least, the crux of the policy for National:
National’s Resource Management Amendment Bill will provide for ‘Priority Consenting’ of major infrastructure projects.
This is what is gets Smith and his colleagues excited -- removing the major legislative impediment to "Thinking Big" -- requiring that projects unilaterally deemed to be of "national significance" to be consented in nine months, or else.
That won't help you or I get our projects built or our property rights protected, but it would allow a National government to steamroll over people's property rights to push through projects like the Waikato pylons.
Which all makes one thing very clear: They don't want to protect your property rights -- they want to promote their ability to steamroller over them. They don't want to make it easier for you to build -- they only want to make it easier for them to build, using borrowed money.
Taken together then Smith's proposals are a mixture of irrelevant, meaningless, hopeless and more damaging -- much like himself really.
Nothing will be fundamentally altered.
The productive will still have to go cap in hand to to ask permission from the unproductive in order to produce. It's just that under Smith's regime the unproductive would be saluting a different coloured flag.
Alas for the opportunity lost -- for the chance to tear down the bureaucratic monster of the RMA altogether, to drive a stake straight through its heart, to dump the RMA once and and for all, and to uncover the property-rights protection of common law that has over seven-hundred years of sophistication and success in protecting both property owners and environment.