Saturday, February 13, 2010

I’m off!

Yes, my droogs, the rumours are true. The good news for you is: I’m heading away.  The bad news: I’m coming back.

But fear not fearless followers of pithy prose and liberty links. While I’m away, not writing home every day, I’ve lined up a stellar cast of stalwarts to host you here at NOT PC.  There’ll be guest posts aplenty, of a quality so high that not only will you not even miss me, you’ll likely never want to have me back.

And as you can see, some of the invitees are so keen they’ve started posting already.  (Onya, boys.)

So see you later.  I’m looking forward to diving into the warm waters of Whangaumu Bay, near Tutukaka, and into a stack of books. Mind you, I think I might have overdone the pile just a little.  Again.

PICT0224

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Mr. Obama, Please Do Nothing

[Guest posted at Not PC by Jeff Perren at the kind invitation of Peter Cresswell, the lazy bastard esteemed proprietor, who is off this week cavorting shamelessly enjoying a well deserved rest.]

Michelle Malkin discusses the pending 'jobs' bill, or as she calls it (accurately) Porkulus II, and labels it a boondoggle.

Her outrage is well placed, though she doesn't point out that even if it resulted in zero fraud and the money went for exactly 'the right things', it would still be the wrong thing to do. That it is the wrong thing is suggested by Obama's recent statement on the subject: "What I won't consider is doing nothing in the face of a lot of hardship across the country."

To repeat for — what is it now? — the hundredth time: that's exactly what is wrong with his entire approach to governing. He should take his cues not from FDR but from Coolidge, who understood the value of the Federal government doing nothing in the face of economic hardship.

(Coolidge was, by the way, roundly mocked for it by the leftist columnist Walter Lippmann, who later said to FDR: "The situation is critical, Franklin. You may have no alternative but to assume dictatorial powers.")

Or, better still, Obama should listen to James Madison who said (when Congress appropriated $15,000 for relief of French refugees),
“I cannot undertake to lay my finger on that article of the Constitution which granted a right to Congress of expending, on objects of benevolence, the money of their constituents.” [4 Annals of Congress 179, 1794]
Now, in theory, the 'jobs' bill isn't charity. More accurately, it's the same absurd Keynesian-inspired approach that has failed time and again. (Interestingly, Allan Meltzer of Carnegie Mellon suggests that Obama doesn't even have Keynes right. But never mind that now.) But the idea behind it is the same: that the Federal government should step in to 'help' when private business 'isn't doing enough.'

It should be no surprise that the idea has failed whenever it's been tried, because when the Federal government does nothing outside what it is supposed to do, the citizens have the freedom to do what they think best.

When they have that, they typically do far from nothing — and the something they do is far preferable than anything Obama will ever do. More importantly, they don't violate the rights of everyone in the country when they do it.

If Obama really wanted to 'do something' helpful, he could encourage Congress to begin repealing Sarbanes-Oxley, eliminating capital gains taxes, gutting the EPA, phasing out Social Security, and Medicare, and in general shaving the leviathan down to bare Constitutional bones. Not surprisingly, in those areas — and thousands more — Obama would prefer to do nothing.


[Cross-posted at Shaving Leviathan where I hope you'll join me daily for more provocative commentary on contemporary culture and politics.]

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Friday, February 12, 2010

What happened to small government, Mr English?

Hi, I'm Mark Hubbard, and I've got a guest spot here at NOT PC this week while Peter is away.  I'll use it now to vent on two topics that have arisen today.

1. This government doesn't understand small government, despite electioneering on it.

The most frightening statistic I learned last year was this (and this before the recession really started to bite, with the private sector layoffs resulting from it): In New Zealand there were 1.75 million people working in the wealth-creating private sector. 1.75 million people having to pay the tax, alongside corporates, to pay for the livelihoods of 1.75 million wealth-destroying bureaucrats in the State sector, beneficiaries and retirees.

That's one for one, and that's a huge Nanny State. Put another way, there were 1.75 million private sector wealth creators having to carry a population of 4.13 million.

Quite apart from the philosophical issues surrounding freedom of the individual, and his or her woebegone pursuit of happiness in a State of this size, mathematically this state of affairs is simply not possible, hence even at that stage, the country was having to borrow a quarter of billion dollars per week (and guess who has to pay the interest and principle tab on that).

So can libertarians and freedom lovers take any heart from Bill English's comments this week on restraining the public sector? No, of course not: Bill's speech is as slippery as temporarily signing yourself out of your own Family Trust in order to gain an advantage at the cost of the taxpayer.

His comments as reported in the NBR
    "Restraint on the public sector has not even started properly yet, Finance Minister Bill English told MPs today. Appearing before Parliament's finance and expenditure select committee, Mr English said government departments had been told before Christmas what sort of increase in their baseline budget they would get in the 2010 Budget. That is earlier than usual: such moves are usually made early in the new year. And most are getting a nil increase he told MPs, although 'three or four are getting some extra.' He did not say which."

Pathetic. There is no reduction of the State even envisaged in this gutless proclamation. It's past the time we needed such 'restraint', this merely means, at best, containment from Nanny's continued growth, keeping her at her current revoltingly obese size, and not even that: some departments are still to get more!

It's way too late for containment, the size of Nanny State must be slashed, and ruthlessly: small government, that's what National stands for, and we have the opposite of that. Bill English should be announcing on 20 May that one in three bureaucrats must go find a real job, with a commitment to further reductions after that. And that the number of government departments, DHB's, and all rest will be reduced from over sixty five to at the most seven. Seven Bill says, why, that's impossible! Sorry Bill, Switzerland, with a population bigger than New Zealand, has just seven government departments. So in the May budget, lets aim for that. Think of the tax cuts we could have on such a reduction, and no need to increase GST, or attack mom and dad's investment in property.

Chances of this happening?

Nil. We're still ruled by the socialist B Team.

2. A sensible approach to Cap-and-Trade

Don't do it. From The New York Times
    "Citing financial worries, the State of Arizona has backed out of a broad regional effort to limit greenhouse gas emissions in the West through a cap-and-trade system.
In an executive order issued last week, Gov. Jan Brewer, a Republican, said a cap-and-trade system ­ which would impose mandatory caps on emissions and allow pollution credits to be traded among companies ­ would cripple Arizona's economy."
Note those last words: "would cripple Arizona's economy."

And yet New Zealand's ETS is still legislated to start July 1 this year, with no political will to change it, despite the Warmists' argument melting quicker than the polar ice cap, which is not melting at all. So on top of GST increases, add increased energy charges to your personal budgets. For a country where households are much more indebted as a percentage of disposable income than the United States this government is set to make the lives of hard working individuals in New Zealand even more uncomfortable.

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Friday morning ramble

    In no particular order, here’s another ramble round a few things that caught this liberty-lover’s eye this week.

    • Simon Power. Law student turned politician turned instant medical expert.
      “Simon Power's dismissal out of hand of important proposals in the Law Commission's Review of the Misuse of Drugs Act 1975 says just one thing: that craven political posturing is more important than preventing harm to New Zealanders.”
      The Death of Evidence – RUSSELL BROWN
      Simony – DIM POST
      Law Commission favours more realistic drug laws – WILL DE CLEENE
       Guess we need a new Justice Minister then – ERIC CRAMPTON
    • r512859_2787727 Peter Garrett. Rock star turned  Australian cabinet minister, turned soon-to-be-ex-minister.
      How can he sleep while their roofs are burning?
      Read Heater Garrett

    • “We see with interest that Tariana Turia understands that the Foreshore and Seabed issue can only be settled with an acknowledgement of property rights and due process through the courts.
      Pita Sharples, it seems prefers the so called ‘communist solution.’ ”Dr Sharples said Maori did not have a concept of ownership prior to Pakeha arriving in New Zealand. . . ”  Very interesting. Very interesting indeed.
      Tariana Turia sound on property rights – ROAR PRAWN

    • Tau Henare throws a few “biggotted” toys out of the cot.  Cactus throws them back, with interest. The Hand Mirror and Busted Blonde stand back appalled.
      MP Facebook Dork Of The Week – CACTUS KATE
      MCP Watch: Tau Henare – HAND MIRROR
      Oooops – ROAR PRAWN

    • The Hand MIrror offers a timely reminder: “Just in case you didn't know, and I'm going to write this nice and big now: Sensing Murder has never solved any murders. That is all.”
      True story.
      A timely reminder – HAND MIRROR

    • Kris Sayce wonders whether the ASB’s Ralph Norris might be a graduate of the same university as ANZ Bank’s Mike Smith: the Pinocchio University?
      Could it Be True Not One Single Taxpayer Dollar Ended Up With the Banks? – MONEY MATTERS

    • Roger Douglas writes the speech that Phil Goff should have delivered this week.  It’s, well, for the guy who introduced and then raised GST, it’s really bloody good. It begins:

          “The most general apology that I need to make on behalf of the Labour Party is for confusing the intention of a policy with the outcomes it produces. I am sorry for thinking that the mere intention of helping those who were least well off actually did help them. I have now come to realise that, more often than not, those most harmed by a policy are those it was usually intended to help.
          “First, let me apologise to the thousands of young people who have lost their jobs because of our support for abolishing the youth minimum wage. . . ”

      Read The Speech That Goff Should Deliver – ROGER DOUGLAS

    • Today could be a pivotal day in Iran. It “marks the 31st anniversary of the coalescing of Iran’s Islamist revolution. But on this deeply symbolic day, which Tehran usually spends glorifying its militant, tyrannical rule, millions of Iranian citizens will likely attempt another show of mass defiance and repudiation of the regime.”
      Pivotal day in Iran – VOICES OF REASON

    • “The government has released a series of aerial photographs of the September 11, 2001, Islamic terrorist attack on America. The photo set, appropriately presented and captioned by the British Broadcasting Corporation (BBC) here, taken from a helicopter by Greg Semendinger of the New York City Police Department (NYPD), was made available to the public following an ABC News Freedom of Information Act (FOIA) filing. The record of this atrocity, currently the worst attack in U.S. history, speaks for itself.”
      New Photographs of 9/11

    _quoteDoes even Mr. Obama listen to his speeches? The public does - at least
    to this extent: They understand that when he's attacking the tired old
    Washington games, he's just playing the game, but when he's
    proposing the tired old Washington solutions, he
    means it. That's the only Barack Obama on offer.”

    - Mark Steyn, ‘Talking the Talk

        _quote The choices are 20 percent unemployment for six months, or
    10 percent unemployment for three years. . .”

    - Friedrich Hayek in 1982, counselling balancing
    budgets and ending credit inflation as a means by which to end that crisis swiftly.

    • “The bounce in the growth momentum of both real and nominal GDP is due to the Fed's massive money expansion. It is an illusion. Neither the Fed nor the government can grow the economy.”
      So just in case you were wondering . . .
      This Depression is Not Over – Frank Shostak, MISES DAILY

    • “Most economists, including yours truly, have been saying that the huge budget deficits the country is running will result in inflation. So, where's the inflation? Inflation normally lags changes in the growth of the money supply by one to two years. The big monetary expansion took place in the last half of 2008. So if the economy follows past trends, one would expect to see growing inflation by the latter part of this year.
          “There are several reasons why inflation does not occur simultaneously with a sudden growth in the money supply…”
      Where Is the Inflation? – Richard Rahn

    • The collapse of Greece is the world’s economies in microcosm.  “They increased spending in the boom years and now cannot find the political courage to cut the budget, just like the US.”
      Mired in debts and government deficits, the talk is of a Euro-zone bailout. “Yet, the whole debate is misleading: Greece is already being bailed out by the rest of the union.”  “The future of the euro is dark because there are such strong incentives for reckless fiscal behavior . . . ” The house of cards is collapsing. The world’s economic fuse box is starting to blow. The metaphors are piling up.
      The Bailout of Greece and the End of the Euro – Philip Bagus
      The Big Fat Greek Government – Mark Thornton

    • “The fiscal crisis in Greece is fascinating political theater, in part because the Balkan nation is a leading indicator for what will probably happen in many other countries. The most puzzling feature of the crisis is the assumption in other European capitals, discussed in the BBC article below, that a Greek default is the worst possible result. It certainly would not be good news, especially for investors who thought it was safe to lend money to the government, but there are several reasons why the long-term pain resulting from a bailout would be even worse. . . ”
      Maybe Greece Should Go Bankrupt – Daniel J. Mitchell

    • You want short-term, destructive behaviour for the short-term appearance of economic stability? Then Greece is just a warm-up for the bigger failures to come.
      No Exit in Sight for U.S. As Fannie, Freddie Flail – WALL STREET JOURNAL (EUROPE)

        _quote We are witnessing the tragic spectacle of the deficit-ridden rescuing the bankrupt with an outpouring of more … red ink—and the taxpayer is left holding the bag.… By extending credit to countries beyond their ability to repay, the final bankruptcy is worse…. There is no point to a bailout that increases world debt when the problem is too much indebtedness already.  Countries are in trouble because they cannot service their current obligations.  The strain on them is not eased by a bailout that loads them up with more.”
    - Former US Secretary of the Treasury, WIlliam E. Simon, writing as if yesterday, instead of in the Wall Street Journal in 1983.

    • Meanwhile, good news for falafel eaters:
      Mediterranean Diet May Hold Key To Avoiding Stroke, Dementia
    • “Wall Street analysts and financial pundits are struggling with a ‘conundrum’…. Retail sales posted an unexpected increase of 3.3 percent in January compared to a year earlier. Furthermore, labor productivity rose a seasonally adjusted 6.2 percent in the fourth quarter of 2009, exceeding expectations and implying a fall in per unit labor costs.
      “Yet, on the same day as these statistics were released, an unanticipated and substantial rise of U.S. jobless claims was reported. The concurrence of these data presented the conundrum: Why are businesses not taking advantage of their rising sales and declining labor costs to increase employment and output and earn higher profits?
      “The answer, as Mises told us, is that entrepreneurs and workers only belatedly and painfully free themselves from the false and frenzied optimism fostered by the inflationary boom, especially one that turns into a runaway bubble. Once people finally do recover a sober view of reality, a deep and abiding pessimism sets in and makes entrepreneurs especially wary of embarking on new and seemingly profitable ventures. As Mises explained it . . . ”
      Read on : Mises Solves Current "Conundrum"--60 Years in Advance

    • 6a00d8341bf72a53ef012877890e8d970c-300wi A fascinating essay here by the son of architect Richard Neutra (the designer of the house in which Ayn Rand wrote the Fountainhead screenplay), which examines the “internal architecture” of his legendary father through a 1958 Berkeley psychological study. [Hat tip Prairie Mod]
      Neutra Territory  - DWELL.COM

    • “Every investment prospectus warns that ‘past performance is no guarantee of future results.’ But suppose that an investment professional's record contains nothing but losses, of failed prediction after failed prediction. Who would still entrust that investor with his money?
          “Yet, in public policy there is one group with a dismal track record that Americans never seem to tire of supporting. We invest heavily in its spurious predictions, suffer devastating losses, and react by investing even more, never seeming to learn from the experience. The group I’m talking about is the environmentalist movement. . . ”
      No More Green Guilt – Keith Lockitch
    • Town planners in Denver are saying “Everybody Must Get Zoned.” “At 639 pages, the old zoning code was considered horribly complicated and cumbersome. Weighing in at 730 pages, not including 76 neighborhood maps and six Overlay District maps, the new zoning code is being called an improvement. It is a control-freak fantasy, with detailed rules for every aspect of city life.”
      Everybody must get zoned: Kenny Be looks at Denver's new zoning rules

        _quote Zoning is a progressive political idea that essentially collectivizes
    land use decisions by creating a ‘public’ right to land use. When
    communities adopt zoning, they are essentially nullifying private
    property rights in favor of community control.”
    - Bill Fischel, ‘The Economics of Zoning Laws: A Property
    Rights Approach to American Land Use Controls

    • Was the "pioneer spirit" the “product of faith."  Hell no! “The "can-do pioneering spirit" is the product of reason, not faith.
      Whence can-do?
    • How about some practical ethics? "With Ayn Rand's Benevolent Universe premise as a starting point, Tod discusses various ways to answer one of the tough questions: What Should I Do With My Life?"
      How to Decide What You Should Do With Your Life – A BLOG BY TOD
    • How about taking a Hotel Hell Vacation?  Motella has the story.
    • Progressives and Pragmatists.  They’re one and the same, you know.  So where does that place Obama?
      Is Obama a Pragmatist? 
    • Anyone else sick and tired of Abraham Maslow's hierarchy of bleeding needs?
      Stop the Maslow Madness – William Green
    • Sarah Palin speaking to 600 “Tea Party Nation” people creates a national media frenzy. Asks Tea Party Patriots, an organization with a reach of millions of members and over 1,000 voluntarily affiliated tea party and 912 local groups: “WHY WOULD 600 PEOPLE AT A RALLY CREATE A MEDIA FREENZY?”  Says The New Clarion: “I’m convinced that this event was covered to designate the Tea Party movement as a right wing Republican movement. I doubt it will work because the parties I attended last year were mostly independent voters with some Repubs and Dems as well. But they may get some mileage out of it. Stay tuned.”
      Hijacking the Tea Party Movement? - THE NEW CLARION
    • Thrutch reckons this interview interview with Mark Pincus, founder and chief executive of Zynga, a provider of online social games, is a great condensation of the principles of rational management.
      Are You a C.E.O. of Something? – CORNER OFFICE
    • Are these the funniest reviews of Avatar you’ve seen?  They’re less a review than an evisceration! “From the sick genius behind the 70 minute review of “Star Wars Episode I: The Phantom Menace”, an equally insightful and hilarious two-part review of Avatar.”

     


    And finally, here’s George Gershwin’s Rhapsody in Blue (click on part 2 once it finishes).  Have a great weekend.

    Thursday, February 11, 2010

    “The Sky Above” - David Knowles

    “Taxi!”

    The more things change, the more statist stupidity stays the same.  As if she were writing yesterday, instead of in December ‘08, allow me to reprise a short post the late Anna Woolf wrote  when she was still very much alive and kicking about the swift fall from grace of a former uni acquaintance.

      Monday, 8 December 2008

      Steven Joyce goes left

        Taxi security reviewed after killing
        "Transport Minister Steven Joyce will review the use of distress buttons, video cameras and safety screens to separate drivers and passengers."
        Does the government have rules on the use of buttons, cameras and screens? If they do have these rules then the only thing Joyce needs to do is get rid of them.
        But let's presume that they rules don't exist - why is the government wasting time and resources on this matter - surely it is the responsibility of the taxi driver what security he would like. Just like they decide if they are going to have a Navman or CD player or air freshener. Just like I decided to have an alarm system installed in my home - the neighbour didn't and was burgled on the weekend - she will now install an alarm.
        Or is Joyce thinking about using our money to pay for taxi security? Please no - that would be a major slide down for this successful entrepreneur. Didn't take long.

    You could say she’s come back from the grave to haunt him.

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    A homeopathic overdose

    Cactus Kate emailed to say I should watch Sceptics’ head Vicky Hyde flaying homeopathic mutters on TVNZ’s Close Up.  Cactus said it was brilliant. I did. It was. 

    Skeptics “overdosing” on homeopathic remedies.  Like shooting fish in a barrel. Hilarious.

    More hilarity on new age bullshit here.

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    Fitzsimons’ Values Party: They won the nuclear war!

    “Credit cards and a Maserati,
    Don't go to films
    ‘Less he knows they're arty
    Likes Womens’ Lib
    And the Values Party,
    He’s a Rasta, he’s New Wave,
    Don’t do nothing
    Less he’s told exactly how to behave . . . ”

    - ‘Rebel,’ by Toy Love / Chris Knox(1978)

    A_260209NZHDPFITZSMONS10_220x147LAST NIGHT JEANETTE FITZSIMONS brought down the hemp curtain on her thirteen-year Parliamentary career. When an MP gives their valedictory speech, all their colleagues and the whole commentariat comes out in force to review their career.

    But I’m not going to do that now.  No more than I did last week.  Instead, what I want to review (just briefly) is the ‘career’ of the Party with whom she was first associated.

    Back in the early seventies there was a political party called the Values Party. (“She likes Women’s Lib and the Values Party. . . ”)  Non-threatening, non-violent and never any hope of winning a Parliamentary seat, they ran a programme based around saving the whales and the Tangata Whenua; around multiculturalism and mediocrity; promoting state support of everything except the production that would pay for it; attacking the “obsessions” with competition, money and personal gratification and promoting instead the spiritualism of sacrifice and “sustainability”—long, long  before any of these ideas were politically fashionable.  They were the original politically correct “rebels.” And they made them fashionable.

    Tripping over their sandals, banging their head on their wind chimes, reeking of patchouli and clad in the inevitable tie-died macrame, at the the time they only appeared to be a threat to themselves, but a careful review of the Values Party programme would show that the Values Party have been one of the most successful parties of the last four decades. They never got an MP within a hippie’s roar of Parliament, but just take a look at the core Values programme (conveniently laid out for us by Claire Browning). and review for a moment how the ideas they brought to the fringes of the political table four decades ago are now front and centre in so much of what passes for political debate today:

    Politics -- MMP, and open government, including freedom of information, now given effect by the Official Information Act.
    International relations -- an independent foreign affairs stance (eg, ANZUS withdrawal), an anti-nuclear, nuclear-free stance, anti-apartheid in sport.
    Law -- New Zealand’s highest court should be a New Zealand court not the Privy Council, Fair Trading and Consumer Guarantees policies.
    Race relations and status of Maori -- strengthening Maori cultural identity and tino rangatiratanga, a Maori Minister of Maori Affairs.
    Status of women -- a suite of policies to remove discrimination and gender bias against women in employment, healthcare, public participation (eg, jury service), and in the home (eg, deploring gender stereotypes, and proposing matrimonial property reform).
    Individual responsibility for moral behaviour -- eg, homosexual law reform.
    Immigration -- a cautious multi-racial population-replacement immigration policy (as opposed to Eurocentric).

    The foundation planks of the Values’ manifesto gave birth to the nostrums of ecological collapse due to climate change; to the soft fascism of political correctness and the collectivism of failure; to the mush of multiculturalism and the mainstreaming of “minorities”; to the “politics of enough” and a  “redistributive philosophy” in which the state would recover and share around the wealth of “the excessively greedy or fortunate”; to anti-capitalist assaults on consumerism and industry; to the greening of socialism and the throttling of capitalism--and they brought these all to the mainstream.  They didn’t just gave birth to the Greens, they gave birth (almost unobserved by the mainstream) to the political agenda of the last forty years.

    What was wildly “way out, man” then is just mainstream and taken for granted today.  That’s the extent of their victory.

    THE VALUES PARTY PROGRAMME was so wildly successful because their members, and many former members, all  understood they were involved in a battle of ideas—at a time when most of their opponents would barely be said to have an original idea between them.  And they had patience. They knew that to capture the mainstream they had to capture the young—and that to capture the young they had to capture the education system, so they could tell those youngsters how to behave.

    And so they did.  And then those youngsters grew up, and took with them those ideas they’d imbibed when their brains were still tender.  It was always a battle of ideas—a battle in which they still give no quarter.

    As Ayn Rand put it, “a political battle is merely a skirmish fought with muskets; whereas a philosophical battle is a nuclear war." I very much doubt whether Ms Fitzsimons would ever put it quite like that, but she would be one of the few in the present Parliament who would understand.

    Because, you see, you could always smell the ideological uranium on Fitzsimons’ breath. You could always smell it on her colleagues.  Which is why the Values Party won the nuclear war. 

    They won it because, for the most part, while their opponents  were fussing about with the tactical weapons of pragmatism and politics—by refusing to confront the fact that bad ideas can only be fought by better ideas—the strategic nuclear weapons launched by the Values alumni were already having their victories.   While their opponents were figuring out the tactics of political musketry, the Values’ troops were (in the words of Chris Knox’s song) preparing everyone to be “told exactly how to behave.” Not for them fussing about with poll numbers, seats and cabinet rankings. They always knew that in the end it didn’t really matter how many MPs you sent to parliament, but how many ideas.

    And that’s why the Values Party won.

    The lesson, for most of us, should be obvious.

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    'Brick Country House' - Mies van der Rohe, 1923

     

    mies-van-der-rohe
    This  wonderfully free-flowing 1923 'pinwheel' plan for a country house project by Ludwig Mies van der Rohe combines elements of Frank Lloyd Wright, De Stijl Art (see below left for example from 1918), Berlage and Malevich.

    The plan itself is almost pure abstraction.  Rather than cutting up space into little boxes, walls thrust out into the landscape--almost as Frank Lloyd Wright first had them do a generation earlier--only here in this house they are simpler and the whole composition less 'centred'; they 'hold' space rather than 'grasp' it, and being less ordered their reach is less centrifugal, and the thrust correspondingly less.

    The elevations themselves are less successful -- Mies was still working out how to roof such a plan (something he worked out with his 'floating roof' of the Barcelona Pavilion) -- but it's fair to say that with this floor plan a new thing was brought into the world.

    It was a plan that fully justified a 'Eureka!'

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    Wednesday, February 10, 2010

    Read My Lips: National will not raise GST! [update 5]

    18 Days before the election, in 2008: “National’s not going to be raising GST.”

    Yesterday, 2:20pm: “The Government is … carefully considering a modest increase in the rate of GST.”

    Yesterday, 5:20pm [audio]: Confirms on Larry Williams' Newstalk ZB show that (in the words of Fran O’Sullivan “the Government indeed plans to raise GST.” 

    Here, then, is the horse’s mouth [hat tip Julian D.]. And it’s not a gift horse, it’s a lying one:

    And no fear saying he didn’t know about the economic crisis when he said it.

    UPDATE 1: Oh, and asked in December ‘08 about raising GST or introducing of a capital gains tax, Bill English responded, “We won't be doing that... It is not our policy.” [Hat tip Gobsmacked]

    UPDATE 2: For youngsters reading this wondering about the phrase “Read my lips,” it refers to one of history’s top ten most unfortunate political one-liners—the one that lost George Bush Sr. his second presidential election, i.e., “Read my lips: No new taxes”:

        “That pledge was the centerpiece of Bush's acceptance address, written by speechwriter Peggy Noonan, for his party's nomination at the 1988 Republican National Convention. It was a strong, decisive, bold statement, and you don't need a history degree to see where this is going. . . Bush raised taxes. His words were used against him by then-Arkansas Governor Bill Clinton in a devastating attack ad during the 1992 presidential campaign.”

    Speaking of which:

    I wouldn’t be surprised if, before the day is out, something similar (but with John Key instead of the hapless Bush I) will be winging its way virally round the web.

    UPDATE 3: Key answers in Parliament.  Apparently it depends on the meaning of the word “not.”  Well, almost.

    UPDATE 4:  Our Blunt cartoonist discovers an empty suit sitting dead centre on the fence . . .

    Bland-Leader

    UPDATE 5:  Since John Boy claims you need to know the context in which his original statement was made, here’s the original article in which he was quoted:

        “National leader John Key said told a press conference this morning that if National is elected and does a ‘half decent job’ at growing the economy, then increasing GST and the top tax rate will not be necessary.”

    It just gets worse, doesn’t it.

    UPDATE 6Liberty Scott reckons the ACT Party has any remaining principles then it now has to front up.  So would ACT bring down the government?

        “With the Nats now backing away from previous statements that a rise in GST is "not on the agenda" and is "not our policy", it appears the two parties the Nats need to govern need to make clear what their policies are. . .
        “Being seen to support an increase in the price of everything to offset tax cuts that may be seen to be for those on higher incomes could cost the Maori Party dearly.
        “However what about ACT? . . .
        “The test is simple - is ACT a party that people voted for so that government could cut one tax but increase another?

    Will they pass?

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    The Corpseman-in-Chief [updated]

    Heading over to the Scoop website this morning to check out all the talk about yesterday’s non-event, I was amused to discover that this SOLO Press Release outrated all the talk about John Boy’s Big Day:

    Corpseman-in-Chief

    Monday, 8 February 2010, 4:31 pm
    Press Release: SOLO - Sense of Life Objectivists
    SOLO-International Op-Ed: Corpseman-in-Chief
    Michael Moeller
    February 8, 2010

    With each new long, drawn out, and substantively empty speech, President Obama's silver tongue has revealed a brain of mush. Most recently, Obama referred to a Navy corpsman as "corpseman", since apparently the teleprompter has not yet incorporated pronunciations phonetically for Dear Leader. Nevertheless, I found the term a wonderfully symbolic moniker for the president himself, and not just applied to his intellectual vacuity, but rather to the entirety of his methods and goals. . .

    Read on here—or head here for a great discussion.

    UPDATE: Added a link to the original discussion.

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    Make your own news

    Charlie Brooker shows you how to make your own generic TV news reports [hat tip Noodle Food]:

    Did somebody say something? [with ongoing updates]

    Liberty Scott responds to John Boy’s “step change” no-change.

         _quote He shouldn't have wasted his time.
        “National is truly back to form, the conservative do-nothing tinker party.
        “Unless voters demand it, the next serious chance for uplifting New Zealand will come with the next serious economic crisis. That wont be for another generation.
        “There will be ever increasing government waste from picking losers; mediocre centrally-planned and provided education and healthcare; a continued growing underclass of hopelessness; and a largely low value commodity based economy struggling to get market access to a world that ignores it.
        “Not enough to encourage me to return to the highly taxed, low value currency backwater when there are opportunities in the US and Europe.
        “There is nothing in this to remotely encourage me to return.”

    In other words, John Key is just being a National PM.

    More comment from around the traps:

    • MACDOCTOR: “Apparently, John Key gave a speech today in parliament. Must have slept through it.”
    • Cactus Kate: “I am not even going to rate the speech as it was just like sex without the orgasm. Not worth bothering about.”
    • NO MINISTER:  “. . . Spending Political Capital - 10 cents at a time.
    • Eric Crampton gives it a C- grade: “Well, the good news from Key's speech is that we're not going to get a land tax. The bad news, surprisingly, also is that we're not going to get a land tax. . . “
    • Visible Hand in Economics “There was nothing in the speech . . .
          “I’ve heard rumours they would change GST in October.  Increasing GST just before Christmas, with no compensation, and coming out of a recession with elevated unemployment is what I would term moronic.  As a result, it can’t be ruled out. . .
          “I heard today that we were going to hear about ‘significant changes to the tax system,’ something about a ‘step change.’  Other than the possibility of a slight shift from income to consumption taxes there was nothing in this speech.  To be honest, it makes me laugh a little.”
    • NBR: “If the Government goes ahead with its entire tax reform package it will be able to cut the top rate of personal tax, corporate tax and trust tax to 30 percent, as well as creating a tax free earnings threshold and compensating low income people for the rise in GST, a tax expert said today.
          “Buddle Findlay tax partner Neil Russ said there was a ‘smorgasbord of options’ that the Government could take if it raised GST to 15 percent and cut the depreciation claims on investment properties. . . ”
    • Bob Buckle, in the Herald, notes the small print: Buckle also found it significant that Key had only ruled out a "comprehensive" capital gains tax.  "It is still distinctly possible they are thinking about some more restricted capital gains tax, such as one applying to property sold within two years or three years of buying it. . . "
    • Fran O’Sullivan fills in some details: “But he left property investors up in the air by failing to say exactly what measures his Government would announce.
          “Tax experts suggest these could involve any or all of the following options: Wiping depreciation on buildings (the Taxation Working Group estimates this could be worth $1.3 billion), putting rental losses in quarantine so they can't be offset against other income, restricting tax losses to $10,000, or, taxing all gains on residential properties after April 1, 2011.
          “The upshot is property investors - and prospective house buyers - were yesterday all aflutter as they played guessing games.
          “Some are likely to hold-off on making an acquisition until after May 20. Others will get out now in fear that property prices will take a drop after the Budget.
          “This is not great governance. . .
          “The Prime Minister subsequently cut through the confusion on Larry Williams' Newstalk ZB show by indicating the Government indeed plans to raise GST and wipe depreciation. It is also planning to reduce company tax.”
    • “Tax changes could hammer cost of doing business in NZ” says Connal Townsend: “The cost of doing business in New Zealand could take a hit if Victoria University’s Tax Working Group suggestions go ahead, according to some property experts.
          “The Property Council of New Zealand commissioned financial advisers KPMG and NZIER to produce reports about the impact of the proposed changes.
          “If depreciation were abolished and land taxes applied, it would have the same effect as if the productive sector’s taxes were increased, making it more expensive to do business in New Zealand, the reports found.
          “According to Property Council chief executive Connal Townsend, commercial property is the infrastructure of business and is fundamental to productivity, international competitiveness and growth.
          “’But more than 80% of commercial property is owned or occupied directly by business owners and the proposals around depreciation would be the equivalent of an effective rise in tax from 30% to 32%,’ Mr Townsend said.”
    • Lindsay Mitchell: “Nobody should be under any illusion that National is getting tough on welfare. They should be red-faced over these window-dressing gestures. Really. It's nothing more than 'been there, done that.’ ”
    • Will de Cleene: “NZ is a freaking backwater in a global recession. There's pluses and minuses to that. And John Key doesn't get it.”
    • Shane Pleasance gives you “John Key's REAL Tax Speech”: “Forget Australia – we could be the Switzerland of the Pacific. Further to our election promises, today I am lowering your tax rates dramatically, and comprehensively.” Sadly . . .
    • UPDATE: The Standard uses M.C. Escher to illustrate John Key’s “Step Change”.  Very apposite.
    • UPDATE: Dodger Rugless says there should be No Tax Changes Without Spending Restraint. (If you’ll recall, however, it was Dodger Rugless who introduced the Goods and Services tax.  And under Dodger Rugless, the government’s total tax take went up . . . )
    • UPDATE: Keith Ng writes to the DomPost: “Dear DomPost. Your headline today, in very large letters, said "$4b in tax cuts coming".People might read that, and think that there are $4b in tax cuts coming.Except that it's $4b in tax cuts, funding by $4b in tax hikes . . . ”
    • UPDATE: Brad Taylor: “One thing really pissed me off though: the suggestion of unspecified reforms to liquor licensing rules to address the Problem of Binge Drinking. This means that beer is likely to get more expensive and less conveniently available so the government seems like they’re doing something. Not cool, John.”
    • UPDATE: Dim Post says The Sun King stumbles: “They haven’t decided what they’re going to do yet, just what they’re not going to do.” On reflection . . .
    • UPDATE: Education Directions: “. . . there are some big announcements for tertiary education . . . ” [hat tip TVHE]

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    Tuesday, February 09, 2010

    Fisking that “step change” [update 4]

    It used to be called a “sea change.” Before that it was a “paradigm shift.” But all a “step change” really means is an admission that the way things are done isn’t working, so we have to try something new.

    But is that really what Mr “I’m-Ambitious-For-New-Zealand” will be offering New Zealand this afternoon in his programme for the coming year?

    To put it simply, the country’s businesses have been mired in shackles, knee-capped by nannying, and hamstrung by hefty taxes.  And John Boy’s solution to that is going to be  . . . well, don’t hold your breath. At a time when the world’s economy is still mired in the Great Recession and none of the old nostrums are working, it’s going to be more rules and new taxes and more of the same old, same old, isn’t it.

    So not very hopeful at all, is it.

    There are manifesto promises that haven’t been delivered, giving (as Lindsay Mitchell says about National’s welfare promises) “an opportunity to keep rolling them out as 'new' announcements.”  This is known as spin.

    And there are manifesto promises that were never going to be delivered, like those manifesto promises to cut back the nanny state, which it’s now clear you’ll never see from these boys, and to give you big tax cuts—which as you might recall as they’re rolled out this afternoon never ever came with the public advisory that any cuts you might see in your taxes will be balanced out by new ones.  So this must be known as lying.

    So amidst a sea of broken promises and a morass of spin and froth, will anything proffered this afternoon bring a “step change”? Or a “paradigm shift”? Or will it just be a shift with the ‘f’ missing?  Let’s take a look this afternoon. Bernard Hickey, among others, will be live blogging the announcements as they come, and (as time permits) I’ll be fisking what I see.

    Stay tuned.

    UPDATE 1: Just clearing the decks here, setting the tone for this afternoon with these two quotes:

      1. "Taxes are the price we pay for civilization
        – Oliver Wendell Holmes
      2. Taxation is the price we pay for failing to build a civilized society, since taxation represents force.”
        Mark Skousen

    Two competing worldviews, only one of which is correct.

    Which one do you think will be taken out for a ride this afternoon?

    Do you think anyone in that National caucus room, or anyone at all in the commentariat who is talking up all the new taxes, understands either the moral point above or the practical point made by Winston Churchill?

    _quote We contend that for a nation to try to tax itself into prosperity is
    like a man standing in a bucket and trying to lift himself up by the handle.”

    UPDATE 2: Said John Key this morning: “I want to make sure that in my time in office I make a difference to making New Zealand a wealthier country, where our kids want to stay here.” So based on that standard . . .

    UPDATE 3: As H.L. Mencken once observed,

        _quoteWhen a new source of taxation is found it never means, in practice, that
    the old source is abandoned. It merely means that the politicians
    have two ways of milking the taxpayer where they had one before."

    It appears the National Party are following that course. We have another promise of income tax cuts; and with it we have the promise of a hike in GST.  We have some promise of tax relief, and the promise with it of extra spending.  We have a promise of welfare “reform,” but a clear signal that the middle-class welfare reform of Welfare For Working Families (which John Boy once called “communism by stealth”) will be untouched.

    If we take those two views of civilisation above, it’s clear from some the “highlights” of John Boy’s speech which is the one of which they approve.

    • No plan to pay off the ever-increasing debt, perhaps by reducing govt spending, but more plans to spend more--and a hike in the only tax that everybody pays.
    • No Capital Gains or Land Tax, but some sort of Property Tax to sweep more people into the grey ones’ net. (Remember how they promised before the election to “force” property owners to build on undeveloped land?  Expect something along those lines.)
    • GST hiked to 15%, with some sort of change made to Income Tax to “compensate.”
    • No change to Welfare for For Working Families—and more taxpayers’ dollars thrown at welfare beneficiaries to “compensate” for the hike in GST.
    • No change to Welfare for For Working Families—but (somehow) will work out how to “compensate” WFF taxpayers on effective marginal tax rates of around 95% for the additional burden of the GST hike .
    • Will now pick winners in Research and Development and throw millions of taxpayers’ dollars around.
    • Will (somehow) free up mining and resource exploration.
    • Will throw billions more taxpayers’ dollars at Conservation to shut the Greens up about mining in Conservation land.
    • Will throw the Public Works Act at property owners getting in the way of infrastructure developments, especially those involving water storage and irrigation.
    • Will improve business’s access to capital, by doing whatever Mark Weldon says.
    • Will throw billions more taxpayers’ dollars at nationalised broadband and other infrastructure—over the next five years, that will be $25 billion plus cock-ups.
    • Will “reform” the welfare system to “get people back into work” (just as Lindsay Mitchell said they would), but will not be touching either the Minimum wage or Youth Rates, which are keeping so many people out of work.
    • Will thrown billions more dollars at education.
    • Says nothing at all about banning planners “ring-fencing” cities (thereby hiking up land prices) but will ban the “excessive proliferation” of liquor stores.

    So much for “step change.” This looks like more of the same, only more so.

    The fundamental point that must be said again and again was made by Henry Hazlitt:

        _quoteThe mounting burden of taxation not only undermines individual incentives to increased work and earnings, but in a score of ways discourages capital accumulation and distorts, unbalances, and shrinks production. Total real wealth and income is made smaller than it would otherwise be. On net balance there is more poverty rather than less."

    Shuffling around that mounting burden does nothing for prosperity.  What is necessary is removing it.

    A responsible government would have done that.

    That they didn’t tells you precisely how “ambitious” they really are.

    UPDATE 4: Comment around the traps on what was signalled as John Boy’s “most important speech since he entered Parliament in 2002”:

    • David Farrar gives it a B.  But he would have given it a B+ if they’d promised even more theft.
    • Phil Goff says “it’s Alan Bollard 1, John Key 0.”  Which is not far from the truth, really.
    • Bernard Hickey summarises the anti-climactic speech: “John Key has just sent Generations X and Y a clear message. Leave the country now.” But Bernard was hoping for swinging taxes on property owners. . .

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    Some quotable quotes for “Tax Reform” Day

    Tax Reform.  It’s what you have when you don’t have real tax cuts—when you don’t bite the bullet and cut your spending to match.

        “Look, over there; it looks like a tax cut.”
        “And look, over there; there’s a tax hike to match.”

    So another shuffling of deck chairs.  Another afternoon of spin.  Another day in which to think and meditate on the nature of taxation, whose “reform” is somehow supposed to make us all prosperous.  Somehow.

    "To steal from one person is theft. To steal from many is taxation."
    - Jeff Daiell

    "I think coercive taxation is theft, and government has a moral duty to keep it to a minimum."
    - former Massachusetts Governor William Weld

    "See, when the Government spends money, it creates jobs; whereas when the money is left in the hands of Taxpayers, God only knows what they do with it. Bake it into pies, probably. Anything to avoid creating jobs."
    - Dave Barry

    “The art of taxation consists in so plucking the goose as to obtain the largest possible amount of feathers with the smallest possible amount of hissing.”
    - Jean Baptiste Colbert

    "The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money."
    – Alexis De Tocqueville

    “We shall tax and tax, spend and spend, elect and elect.”
    - 'New Deal' luminary Harry Hopkins

    "Most of the presidential candidates' economic packages involve 'tax breaks,' which is when the government, amid great fanfare, generously decides not to take quite so much of your income. In other words, these candidates are trying to buy your votes with your own money."
    - Dave Barry

    “Taxation is just a sophisticated way of demanding money with menaces.”
    - Terry Pratchett

    “For every benefit you receive a tax is levied.”
    - Ralph Waldo Emerson

    "It's sad to realise that most citizens do not even notice the irony of being bribed with their own money."
    - Anon.

    "[There are dangers in] the disposition to hunt down rich men as if they were noxious beasts."
    - Winston Churchill

    "When Barbary Pirates demand a fee for allowing you to do business, it's called 'tribute money.' When the Mafia demands a fee for allowing you to do business, it's called 'the protection racket.' When the state demands a fee for allowing you to do business, it's called ‘sales tax’."
    - Jeff Daiell

    "Taxation is far greater an evil than theft. It is a form of slavery. If you cannot choose the disposition of your property, you are a slave. If you must ask permission to work, and/or pay involuntary tribute to anyone from your wages, you are a slave. If you are not allowed to dispose of your life (another way of defining money, since it represents portions of your time and effort, which is what your life is composed of) in the time, manner and amount of your choosing, you are a slave."
    - Rick Tompkins

    "The man who produces while others dispose of his product is a slave."
    - Ayn Rand

    “We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.”
    - Winston Churchill

    "Taxation without representation is tyranny."
    - James Otis

    "Taxation WITH representation ain't so hot either."
    - Gerald Barzan

    "Our forefathers made one mistake. What they should have fought for was representation without taxation."
    - Fletcher Knebel

    "When a new source of taxation is found it never means, in practice, that the old source is abandoned. It merely means that the politicians have two ways of milking the taxpayer where they had one before."
    - HL Mencken

    "What is the difference between a taxidermist and a tax collector? The taxidermist takes only your skin."
    - Mark Twain

    "Government's view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it."
    - Ronald Reagan

    "Death and taxes are inevitable; at least death doesn't get worse every year."
    - Unknown

    "When more of the people's sustenance is exacted through the form of taxation than is necessary to meet the just obligations of government and expenses of its economical administration, such exaction becomes ruthless extortion and a violation of the fundamental principles of free government."
    - former US President Grover Cleveland

    "Rulers do not reduce taxes to be kind. Expediency and greed create high taxation, and normally it takes an impending catastrophe to bring it down."
    - Charles Adams

    "The mounting burden of taxation not only undermines individual incentives to increased work and earnings, but in a score of ways discourages capital accumulation and distorts, unbalances, and shrinks production. Total real wealth and income is made smaller than it would otherwise be. On net balance there is more poverty rather than less."
    - Henry Hazlitt

    "The poor of the world cannot be made rich by redistribution of wealth. Poverty can't be eliminated by punishing people who've escaped poverty, taking their money and giving it as a reward to people who have failed to escape."
    - PJ O'Rourke

    "A government with the policy to rob Peter to pay Paul can be assured of the support of Paul." - George Bernard Shaw

    "Freedom is the quality of being free from the control of regulators and tax collectors. If I want to be free their control, I must not impose controls on others."
    - Hans F. Sennholz

    "There's only one way to kill capitalism--by taxes, taxes, and more taxes."
    - Karl Marx

    "The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation."
    - Vladimir Lenin

    "Giving money and power to government is like giving whiskey and car keys to teenage boys."
    - PJ O'Rourke

    "A society of sheep must in time beget a government of wolves."
    - Bertrand de Jouvenel

    "The power to tax involves the power to destroy."
    - former US Supreme Court Justice John Marshall

    "Taxes are not levied for the benefit of the taxed."
    - Robert Heinlein

    "Taxes are the sinews of the state."
    - Cicero

    "Be wary of strong drink. It can make you shoot at tax collectors, and miss."
    - Robert Heinlein

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