National Government Supports Subsidies

The right-wing continually denounce business subsidies. They claim to believe in a sort of economic natural selection where businesses must be able to thrive, unsupported, and only the strongest should survive. 

New Zealand does have one of the least protected economies in the OECD and the Government is currently welcoming overseas oil companies into our region to drill and explore. New Zealand is ranked 3rd in the world for the ease of doing business and there will be few regulatory hoops or costs providing barriers to those wishing to explore for oil and gas. 

The Government's Energy Strategy focused heavily on fossil fuels, rather than clean alternatives, and the ETS has been altered to ensure that the coal and lignite industries would be protected from paying for their carbon emissions. Despite having the recognition of being easy for doing business, this Government is making changes to the RMA to fast track consents, limit local bodies ability to use the Four Well-Beings to manage future developments and is spending millions on irrigation to support greater intensification of dairying. 

Wages have not increased greatly over the last few years and, with the re-introduction of youth rates, the Government has managed to keep a cap on labour costs too. This has meant that many workers are not able to survive on the wages they receive and a great number have to have their living costs topped up by the taxpayer. 

When a Government supports some businesses by paying for carbon emissions, pollution clean ups, high numbers of worker injuries, labour costs and irrigation, these are forms of subsidisation. While many businesses can become very profitable because of this support it will also drain the government coffers and shifts taxpayer money away from core Government services. I wonder how much extra could be spent on health and education if we didn't have to pay for: 
  • $2.3 million annual ACC claims due to accidents in forestry sector
  • $11 million in legal bills and rescue attempts in dealing with Pike River
  • $11.6 million initially spent to clean Lake Ellesmere 
  • $17.5 million to clean up the Tui Mine
  • $130 million to deal with the Rena disaster 
  • $142.2 million to clean the Rotorua Lakes
  • $148 million for advanced benefit payments to assist with hardship
  • $390 million Solid Energy loss
  • $1.5 billion in subsidising carbon emissions each year
  • $1.9 billion on assistance with hardship and accommodation allowance etc (2012/13 budget)
  • $13 billion to fix leaky buildings 


Shane Pleasance said…
I agree with most of this post. What do the Greens propose?
bsprout said…
Wow, Shane, that's a first :-)

You probably wouldn't approve of our proposals, however because they would involve robust processes to ensure any new industry consent does not negatively impact on others or the environment, will be sustainable and adds value to the community at large.

i personally am keen on a single regional development plan that would give certainty to new businesses regarding what would fit. I think it is a waste of time to go through a lengthy and expensive consent process only to not be successful. For instance unless there is evidence that mining lignite will provide long term value without negative environmental effects then it should be clearly stated that accessing that resource is incompatible with the plan.
bsprout said…
Also any business should also be prepared to cover much of the external costs of operating that is often covered by the taxpayer, like water pollution.
Shane Pleasance said…
Libertarianz (as we remain named for now) will support ANY policy by ANY party which increases individual freedom.

You would be suprised how much we have in common.
Armchair Critic said…
Shane is correct about how much the Greens and Libertarianz have in common. It is quite a lot.
bsprout said…
Hmm, I am not so sure, Armchair. As an educationalist I do not feel comfortable with their education policy which would be similar to giving up our entire system to Charter Schools. A little like each community setting up their own hospital and decision making on management and treatments led by laypeople. There appears to be no recognition of the value of professional managed institutions bound by codes of ethics and informed by research and the knowledge gained through collegial practice.
Shane Pleasance said…
I am not sure how you draw that conclusion, Dave. Why would communities not choose codes of ethics and professionally managed institutions to provide education?
Shane Pleasance said…
And, (chuckle), there is more to life than education Dave. Honest.

Armchair Critic said…
I suppose what I meant was at a very fundamental level, Dave.
Both parties were founded on well considered principles, and neither has strayed far from those principles. Many of the principles are similar. The differences arise from the interpretation and implementation of the principles.
I find Shane's comments are usually well thought through, rarely malicious, sometimes witty and often a combination of the above. Given the dearth of good commentary on political blogs I think you are lucky. And overlooking the common ground or preferring to focus on differences is folly.
Please note - this is the first time I've stuck up for a libertarian.
bsprout said…
Armchair, I get your point, it used to be the same with the Act Party as it generally operated as a party with clearly defined principles. On many social justice issues Act and the Greens voted together and I can imagine that it would be the same if the Libertarianz ended up in parliament.

I think what concerns me about the Libertarianz policies is the abandonment of national professional institutions in favour of local communities determining how their health and educational needs will be met. The sort of knowledge and expertise that large professional institutions can provide cannot be replicated by communities of lay people.

It would result in varying levels of quality and mixed standards across the country and put the health and welfare of many adults and children at risk. While some communities may provide services of a high standard others, by the nature of their community (poor and lacking in education) will struggle.

robertguyton said…
"Why would communities not choose codes of ethics and professionally managed institutions to provide education?"

Because they are in the thrall of the private owners of the buildings etc they occupy? Because they might not have a true understanding of the motivations behind those owners? because boards might be loaded with members who don't subscribe to codes of ethics and professionally managed institutions?
That sort of unknown?
Already, the proposed Charter (Secret) schools aren't required to have trained teachers, or disclosure to the Ombudsman? What else might they decide? Naturist schools might do away with, say...

...rote learning of times tables!
Shock and horror!
Shane Pleasance said…
Same 'problem', same 'solution', eh?

Keep fingers in those philosophical ears.

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