NZ Green Party
Government tells those on minimum wage to tread water

Very conveniently, at 4pm on the eve of parliament re-convening, the government has tried to quietly announce that they will raise the minimum wage by 50 cents, in line with inflation. It’s not good enough, given that the current minimum wage is not a living wage. Our lowest paid citizens, already up to their gunwales with water, are being asked to keep themselves afloat a little longer. How can any worker be productive when they cannot even survive on their wage?

However, Labour’s response is even more deplorable. (Link coming.) It is only in opposition that they have finally seen the light and called for a proper living wage, which we told them was $15/hour a few years ago. They did not see fit to raise it properly in the good times, so they have no business giving National grief for failing to do it in difficult times.

I agree with Kiwiblog that you cannot legislate higher living standards and that you cannot rush out and impose a $30/hr minimum wage. Where I disagree is with his claim that we cannot move gradually, (but aggressively by our government’s standards), towards a living wage. Productivity is important. Deadly important. But it will never improve where workers are paid slave wages and are forced to work multiple jobs just to survive.

It’s high time we took ourselves seriously and stopped bemoaning our low-wage economy while doing little or nothing to change our lot. It is not chicken and egg. We have to lift wages and productivity, together.  However, our first duty is to our own people and it starts with a living wage.

I’ve had my rant. Here is what Sue Bradford has said officially on behalf of the Greens. (I narrowly escaped with my treading water and sailing analogies)

104 thoughts on “Government tells those on minimum wage to tread water

  1. Productivity is important. Deadly important. But it will never improve where workers are paid slave wages and are forced to work multiple jobs just to survive.

    Then why not just remove taxes on low income workers? You are just as likely to force small businesses not to hire people.

    Why not continue to use this as an opportunity to drop taxes, not on the first 5K, but on the first 50K? What happened to taxing the ‘bads’, instead of taxing the Dads?

    A living wage varies for the at-home teenager wanting job experience and a father supporting a family of 4. Setting a minimum wage to cover both situations isn’t a great solution. We can be cleverer than this, I think, by being a bit more radical with our approach to tax. And possibly make everyone happy. I have a few radical ideas on this. Anyone else?

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  2. The left alliance has had nine years! Guess it just wasn’t that important, huh.

    We’ve been paying high taxes for far too long. The quickest way to get the money flowing is to stop taking it off workers in the first place.

    Good move, John.

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  3. yes fwwog it was bad to hear the PM tell us on tv that he thought he had the balance right on this issue.
    a person can not live on the minimum wage.
    It needs to be double what it is, to compete with australia.

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  4. But isn’t he the very man you were rooting for prior to the election petequixotic? He seems to me a dull-eyed sort of chameleon, that Key and hardly the Champion of the Poor.

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  5. Where’s the ‘minimum wage’ for us poor suckers trying to run a business?

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  6. See Roger Douglas on how to get the poor into success mode.
    This should be enough for you to find it through Google:

    A High Growth-Low Welfare State

    Hon Sir Roger Douglas, ACT New Zealand

    Speech to the Rotary Club of Orewa; Rotary House, Hibiscus Coast Highway, Silverdale, Hibiscus Coast; Embargoed To: 6pm, Tuesday, February 10 2009
    Since September, politicians and the media have become increasingly concerned about the state of our economy.
    Predictions of no economic growth in 2009 have moved from being the worst case scenario to the reality facing New Zealand. As the truth of the recession and higher unemployment hits home, politicians and households have become alarmed. Although rightly concerned about our economic prospects, New Zealanders are wrong to see our woes as largely being driven by the global financial crisis.

    The challenges that New Zealand will face due to the international crisis will, no doubt, be great – but we mustn’t fool ourselves: New Zealand has been in a recession – getting poorer – since the first quarter of 2008. We were in a recession before the fallout from the global financial crisis arrived on our shores; we were in a bad economic situation, and the financial crisis has simply made that situation worse.

    Today I want to set out the economic troubles facing New Zealand, and then set out a way to redesign our tax and welfare system to achieve a high-growth low-tax welfare state.

    First, let’s consider the deteriorating economic situation after nine years of Labour control.

    In the private sector, our current account deficit has ballooned to its largest since the last major recession in 1975. This large increase in the current account deficit – now equal to 8.5 percent of GDP – occurred despite the most advantageous terms of trade since the early 1980s.

    As our current account deficit grew larger, we told ourselves that a significant drop in the dollar would help eliminate it. Unfortunately for us, the drop in the dollar has been accompanied by a significant reduction in commodity prices.

    What does this mean?

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  7. This topic is a little outside the Centre’s field but our interest in employment encouraged me to write this letter to the Herald in response to Brian Rudman’s little essay on the minimum wage.
    They probably won’t publish it so I pass it on it case it proves useful.

    The Editor

    Brian Rudman is right – there is no right time to increase the minimum wage.
    The best way to make low income earners better off is to reduce their tax.
    Say I have decided to pay someone $8/hr to mow my lawns rather than mow them myself.
    Assume that someone is prepared to mow my lawns for $8/hr in the hand.
    To keep the arithmetic simple assume a flat tax of 33.3 percent.
    The tax means I have to pay the lawn-mower $12.00 an hour.
    But to pay the $12/hr I have to earn $18/hr.
    So it costs me $18/hr to put $8/hr into the lawn-mower’s hands.
    So I decide to mow the lawns myself.
    If there was no income tax on a wage up to say $20,000 then I only have to pay $8/hr to the lawnmower and only have to earn $12 /hr to do so.
    The lost tax revenue is covered by keeping the lawn mower in work and off the benefit.
    It is always the right time to reduce the tax rate on the minimum wage to zero, because they are better off and more low income people retain their jobs or enter the work force.

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  8. Frog, explain to me why increasing the minimum wage is good? In times like this, all you will see is business attempt to cut their wage bill by either requiring their employees to cut their hours, or by laying them off. How would having decreased hours, or no job be good for those workers?

    I don’t mind seeing the minimum wage raised during good times, just now is not the right time to do it.

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  9. john-ston – you ‘ don’t mind’ seeing the minimum wage raised during good times? How magnaminous of you!

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  10. Peterquixote,

    a person can not live on the minimum wage.
    It needs to be double what it is, to compete with australia.

    Really? By my calculations, taking tax and levies into account, i need only work 12 hours per week on minimum wage to fully support myself with wonderful accomodation, plentyful high-quality food, excessive power and internet, and heat. And that is without a garden, second hand clothes, or charity bin. Reduce my affluence and i could cut an hour or two more. Add a garden and there goes another. Though I am renting, oh the inhumanity! pfft!

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  11. “john-ston – you ‘ don’t mind’ seeing the minimum wage raised during good times? How magnaminous of you!”

    Greenfly, it isn’t about generousity, it was a reflection of practicality. The problem with the free market and wages is that you have a chicken and egg paradox; what comes first, the increase in capital goods, or the increase in wages, and I haven’t seen anything that proves that without government intervention, you get that increase in capital goods which would make low wage jobs redundant.

    During good economic times, there is little to no harm in increasing the minimum wage; those that do become unemployed as a result of increased capital goods will be able to get alternate jobs and thus be absorbed back into the labour market. Furthermore, during good times, businesses don’t mind excessively if there is a little fat in their labour force, and may consider keeping said employee.

    During bad economic times, the problem with increasing the minimum wage is that businesses are worrying about keeping costs down, and the first cost they look at is staffing. If wage costs go up, because the government has said so, then you will find that hours will be cut, or staff laid off. Unemployment is far worse than seeing your real wages decrease.

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  12. I can’t believe you’re serious in claiming that $26,000/yr (minus tax) isn’t enough for a single person to live on.

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  13. Deal with the problem Greens.

    The problem isn’t the minimum wage its the inflation which eats away at the minimum wage holders spending power.

    Why does the green party not have a policy for moving NZ onto a hard currency and off of fiat money.

    Long term that would have a much bigger impact for the people on fixed incomes, the poor and the retired.

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  14. >>our first duty is to our own people and it starts with a living wage.

    That sort of attitude will just see jobs exported to Australia. Such policies should really be called “Making People Unemployable” policy.

    If a person is marginal at $12 p/h, then the lose their job at $12.50. Just think what would happen if you push it to 3/4s of the average wage. Such lunacy will see waves of unemployment as this would lead to wage inflation at all levels, and no corresponding rise in productivity.

    An organic salad costs $5.50 for the organic farmer to produce. You demand he sells it for $4.50, in order to “look after our own people”.
    The organic farmer could also grow stuff in Australia.

    What happens next, Frog?

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  15. They probably won’t publish it so I pass it on it case it proves useful.

    Everyone i’ve ever met who’s written a letter to the editor says that! ‘…Cos i’m too real for them!

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  16. If a person is marginal at $12 p/h, then the lose their job at $12.50. Just think what would happen if you push it to 3/4s of the average wage. Such lunacy will see waves of unemployment as this would lead to wage inflation at all levels, and no corresponding rise in productivity.

    By “wage inflation” you mean everyone else has to increase their wages too? Seems like as a result then the minimum wage would have to increase again to keep up with that, leading to increases in the other wages…etc.

    ?

    UTOPIA!

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  17. Owen,

    Your lawnmowing scenario is absolutely brilliant.

    The obvious answer is to cut taxes for the low income earner.

    For if the an increase in minimum wage was the correct answer, it should be raised to $25 immediately.

    I would think the even a hardened left winger would see that this will lead to increased pricing for goods and services plus the destruction of jobs as business becomes unviable.

    And with no PAYE or business tax income, where will the state provide the welfare required to keep people on the unemployment benefit?

    Not to mention all the other state services provided by the tax take.

    Another method to pay higher wages would be the abolition of company taxation. More money retained in the business to both grow the business AND pay higher wages.

    That would be a winner.

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  18. StephenR,
    I have had scores of letters published in the Herald as well as numerous columns and op eds etc.
    I just happen to think they won’t publish this one because it has too many numbers and they know their readership.

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  19. Owen,

    Okay, yeah you’re probably right. ‘Annoyed of Avondale’ will probably beat you to the punch.

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  20. Zen Tiger – the greens have not changed their positi9on on removing taxes on the first 10k of everyone’s income. We still think that that is a great idea. Show me where john Key is suggesting that and I’ll show you the Greens lining up behind him. That doesn’t change the minimum wage argument at all.

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  21. ZenTiger

    Then why not just remove taxes on low income workers? You are just as likely to force small businesses not to hire people.

    As Frog said removing tax on first $10,000 is already GP policy.

    The idea that small businesses will stop hiring if you raise the minimum wage is silly. People on low wages are generally working in industries that must be done. Cleaning up after the rest of us or serving us in some way. Increasing their wages will put some pressure on inflation, but (a) not much as wages for the low paid are only a part of the cost structure and (b) inflation is not, this year, a problem.

    Sapient

    By my calculations, taking tax and levies into account, i need only work 12 hours per week on minimum wage to fully support myself with wonderful accomodation,

    12 hours * $12.50 = $150 per week. How can you get wonderful accommodation for so little? I think their might be a misunderstanding or a lie here.

    Owen McShane

    Why would anybody pay any attention to Roger Dougles in the 21st century? He is completely discredited. The economic policies he represents and advocates we now know lead to stagnation, gross injustice and the centralisation of resources. Pay attention to modern economic thought!

    turnip28

    Why does the green party not have a policy for moving NZ onto a hard currency and off of fiat money.

    Because when we study the reality of the situation that we (our society) are in there is no benefit of hard currency. The problems we have are not caused by fiat money. Inflation can still occur with a hard currency. And there is no practical or theoretical reason to base money value on a mineral value.

    peace
    W

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  22. In addition to leading to job losses, increasing the minimum wage without an increase in productivity subsequently results in inflation which erodes that increase.

    Does keep the peasants from revolting for a month or two.

    We CAN’T catch up with Australia unless we work smarter. Their productivity is 30% higher than ours. And it’s not just about digging up minerals.

    With bugger-all natural resources Luxembourgers earn 2.5 times as much as Kiwis. Slovenia and Portugal have passed us. Turkey and Mexico are hot on our tail.

    We’re on our way to the Third World.

    It’s ALL about PRODUCTIVITY. Which grows out of education, public and private sector efficiency, small government, R & D, savings and all the other stuff our pollies are too timid to tackle.

    Economics 101.

    See Professor Paul Callaghan’s presentation here:
    http://hotscience.co.nz/video_detail.php?videoid=169
    He gets it.

    The facts
    http://www.mistywindow.co.nz/economy/gdp-&-productivity.htm

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  23. “Because when we study the reality of the situation that we (our society) are in there is no benefit of hard currency. The problems we have are not caused by fiat money. Inflation can still occur with a hard currency. And there is no practical or theoretical reason to base money value on a mineral value.”

    You never had severe bouts of inflation in the era of the Gold Standard; indeed the prices of 1815 were seen again in 1939; essentially you had net price stability.

    Once the world was taken off gold in 1971, inflation went through the roof. You have only ever seen severe bouts of inflation with paper currencies, never hard.

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  24. Given that food prices are unaffordable for those on the minimum wage, that’ll just increase the number of people who are going into WINZ to get food vouchers.

    Watch out for large queues at a ‘service centre’ near you!

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  25. Bliss,
    Actually; 12 hours per week * $12.50 per hour * 0.80 percent retained after tax = 120 dollars per week after tax :P
    Its all about compromise, i dont live in a massive house and i dont pay a mortgage, i rent and share accomodation. It comes down to 60 per week rent per person and 60 dollars on power/internet/food/heat, less than half of that is for food.
    May not be what some people dream about but it is a affordable and effective way to get by, and with good flatmates and a good house its even better than living alone or with only your partner as there is much less matenence per person and the jobs such as cooking and cleaning, and the power/heating costs are shared between members. Large rooms, large living areas; not exactly cramped for space.
    I call it an “economy of scale”, eh?

    Most people may not want to live like that, but realisticly if your on the dole then its more than you disserve. And if your working on minimum wage only twelve hours per week; train up or work more hours. And like i mentioned previously, if you have a garden you can wipe of alot of those costs, as can you if you dont have several power hungry gaming computers or servers running at any one moment and dont download about 80+ gigs per month :P .

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  26. Katie,
    Theres this thing i call rice…
    And dont forget those other things, what do we call them? ah! vegies!

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  27. Careful, Sapient. You’re talking to champagne socialists :)

    Most Green voters live in central urban areas and what you’re describing is waaaay beneath their comfort zones.

    “Bolly, sweetie? Save the whales…blah blah blah…..eco…darling…eco-friendly!…it’s the new thing!…..lets’ get Lulu!”

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  28. The powerful ‘morris dancing’ group of Green voters will be highly inflamed at being ignored.

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  29. Re: My 12.20pm comment;
    A way of life made possible by the services of decent “evil” landlords.

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  30. Sapient,

    you’ve obviously found somewhere extremely cheap to rent. to make our rent $60 per week we’d need 6 people dwelling in our 2 bedroom flat. not particularly affluent, next to the motorway in pt chev. your budget is absolutely ridiculous and unrealistic.

    I could easily say “I could work for only an hour and a half on min wage and have more than enough to feed, clothe and house my family of 17 and take overseas holidays 3 times a year” doesn’t make it true…

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  31. nommopilot – your problem is that you choose to live in pt chev for a variety of lifestyle/work/study reasons. Other people like sapient might choose a different location where they can lower there living costs and still maintain a lifestyle of their choosing. Its about choices, something that champagne socialists don’t have to make because their wealth insulates them from the costs they try to impose on others …” yes we should all eat organic food never mind that its cost $200pw more, the poor will be so much more enriched by know ing that they are starving to meet the cost of my social conscience indulgence” (in the 14th century people could buy a papal indulgence absolving them off their guilt, without actually having to do anything).

    This whole article is a case study of champagne socialism on behalf of the wealthy constituents of the green party. It is cruel in promising sugar lollies to workers before starving them of protein and carbohydrates via employment, stable prices and the ability to advance themselves. It does nothing to improve the short, medium and long term outcomes of people on lower incomes. It just makes wealthy greens “feel” that they are doing something when they are too afraid to acknowledge their limitations in the ability to improve social outcomes.

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  32. Toad,
    I happen to have it with almost every meal, so yes. Its nota problem with the income levels in this country; its the third world that starves.

    Nommopilot,
    It is a Palmerston North central city flat, 240 rent per week, about average for a palmy four room rental. of course its more expensive in other cities but not more than two hours additional work :P still easily obtainable. The point is that someone working a full 40 hour week could support themselves easily on minimum wage, and likley afew hangers on too. if not, they need to learn some serious money handling skills.
    12.50 is far more than sufficent.
    If it were up to me we would have a flat tax of 15 percent, no minimum wage, and a universal dividend of 5250 per year provided 10 hours work per week on average; the result being a 35,000 tax free bracket with those bellow accually receiving money from the tax, with no barriers to work like the present system and near full employment.

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  33. your problem is that you choose to live in pt chev for a variety of lifestyle/work/study reasons.

    as opposed to living miles from where I work and study and requiring a massive amount of time and money to commute. the amount of employment in areas that have $60 pw rents is not much. if I lived in south auckland my commute would be 20 hours a week and I’d be spending the difference in rent on public transport/petrol and have less time to spend with my family.

    we live in an affordable flat, with a modest lifestyle and I’m not complaining. I’m pointing out that Sapient has no idea about the true costs most people face. sure we could all move to hawera where rent is cheap, but that would just lead to a big increase in people who can’t find work there. Sapient wants us to believe that those on the bottom rungs have it easy and are just whingers. not so.

    and I hate champagne.

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  34. “Sapient wants us to believe that those on the bottom rungs have it easy and are just whingers. not so.”

    No Sapient is pointing out that you make lifestyle choices. Sapient has made choices that include frugality and living within his/her means and still enjoying life. You say your living in an affordable flat but then say they difference between living there and south auckland is 20 hours a week. That suggest you are not living in an affordable flat because you are not include the opportunity cost of your decision – There is no such thing as a free lunch but your decision making is include a free lunch into the calculation.

    I see Sapient is happily defending him/herself. Have to give sapient big ups for the choices he/she has made. Its’ not always easy and can include the downside of not being part of the “cool” crowd in the short term but has signifcant medium and long term benefits that are really worth the effort.

    Re champagne – you need to pay decent dosh sadly. Generally $50+ to be drinkable and probably french. Otherwise try some good Australian sparkling shiraz or Italian prosecco as an alternative. Its a quality thing rather than quantity.

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  35. Nothing wrong with Lindauer (silly Frenchy bubbly naming regulations aside), and I can afford the Moet. There’s a saving of $60 a bottle.

    A mate of mine in London, who can also afford the Moet, seeks out Lindauer because he loves it and sees it as a bit exotic!

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  36. @Hayek “You say your[sic] living in an affordable flat but then say they difference between living there and south auckland is 20 hours a week”

    that is incorrect. to live in sth auckland I would be giving up 20 hours spent in traffic or PT that I could be charging to clients at $50ish an hour, or spending with my partner and new daughter. let’s say I could save $100 dollars living in south auckland then from that subtract the costs of transport (easily $50/wk) and what I could earn in the 20 hours if I wasn’t using them to travel (up to $400) and it’s pretty obvious. I’m more than happy with my decision to spend more on rent so I can spend time with my family instead of on a bus or in gridlock.

    It’s fine for Sapient in a cheap city. part of the reason it is cheap to live there is that employment opportunities are much lower in PN than a bigger city. if everyone moved there rent in PN would go through the roof and unemployment would do so too. Just becouse he/she has found a good situation does not mean that these options are there for everybody.

    Try adding a few dependents and the costs and associated work of caring for them, as well as long commutes from where the rent is cheap to where the work is available and the maths as presented by sapient does not stack up.

    @ BluePeter @ Hayek

    keep pushing that “champagne socialists” bo11ocks if you think it makes you sound clever. in fact most greens pay as much tax as anybody else and have just as much right to express how they think it should be used.

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  37. >>keep pushing that “champagne socialists” bo11ocks if you think it makes you sound clever.

    I think it makes me sound very clever :)

    It’s also accurate. I do live in Wellington, so I know quite a few of them!

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  38. “I do live in Wellington, so I know quite a few of them!”

    well then you obviously have a representative sample there. I live in auckland so I know that most Nats are greedy capitalist piggies. aren’t I clever…

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  39. “I think it makes me sound very clever”

    the flaws in your thinking exposed!!

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  40. I prefer “bollinger swilling bolsheviks” when talking about people like nommopilot.

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  41. >>most Nats are greedy capitalist piggies

    You say “greedy” as if it were a bad thing…. ;)

    >>bollinger swilling bolsheviks

    Organic, of course….

    Mead Mashing Morris Dancers?

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  42. nommopilot – the champagne socialism is about the fact that few, if any, greens [MPs] actually are from the working class that they claim they are representing. Mostly they are well off – in fact rich pricks by the definition of the Hon Dr Micheal Cullen. An example is Sue Bradford – I admire her spirit of advocacy and choice to be an advocate, but she is from a secure and privileged background and has made personal choices. One of the worst offenders is Sue Kedgely who is blue blood by any standard. Keith Locke is the green representative for Epsom. That would be the gentrified tree lined suburb of epsom home of the BMW, mercedes and million dollar villas.

    Your doing quite well as painting your self as one – “I pay as much tax as anybody else…” I don’t mind you having an opinion and good opinion backed by empirical analysis is to be applauded if it provides a solution that improves the lives of all New Zealanders. However on this particular topic, frog is just providing the greens with the equivalant of a papal indulgence – it allows you to absolve yourself of guilt without having any effect on improving to well being of all new zealanders.

    My comment about affordability is that you are happy to life where you are. You made a choice to pay higher rent to spend more time with family. That is a good thing for you and your family, but it is a choice and one where you have foregone a significant opportunity cost in return for particular benefits (time with family).

    Have you not considered taking a cut in pay and change in job to life in palmerston north (hey what about establishing a new business!) which would also enable you to have time with family and life in more affordable housing?

    Essentially you are loading up one side of your accounts with benefits but are not considering the costs on the other side of the balance sheet. Leaving you able to justify your lifestyle preference. Your entitled to do this, many other people do. But your not entitled to use this as a critique of Sapient for choosing to consider the costs and benefits on both sides of the account and then make adjustments so that he/she can live within their means. In the end their is no such thing as a free lunch, even if you think your enjoying one at the moment.

    Blue Peter – I assume your referring to the lindaur blanc de blanc and equivalents. Sad stuff the basic lindaur which is mostly mixed by youngster with vodka and jusice as a form of lolly water. Yes there is some good NZ methode traditional.

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  43. turnip “why is greed bad?”

    because when someone takes more than their share others miss out on their share. did you miss primary school?

    “I prefer “bollinger swilling bolsheviks” when talking about people like nommopilot.”

    you were obviously greedy when they were handing out the funny…

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  44. >>because when someone takes more than their share others miss out on their share. did you miss primary school?

    I think you may have missed out on economics class. It’s better if you grow the pie, rather than trying to slice the one you have into smaller and smaller pieces.

    I’m turning kiwi services into US dollars. How are you growing the kiwi pie?

    Greedy, and proud :)

    PS: Suggest you give hand 1/4 your wages to some poor South Auckland family. You have more than they do, which must mean you’re a greedy piggy!

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  45. BP – what happens, as say in the real world, when the pie, at least the material pie, is finite? We have always had the luxury of growing the pie rather than shrinking the slices, I agree. How much longer will we have that luxury, at least in terms of the material world?

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  46. I hate champagne (or any other bubbly for that matter) – give me a cardboard box of Chasseur any day.

    Unless BP or Turnip have a bottle of Château Margaux they want to share! Now, don’t be greedy guys – or did you always get beaten up in the school playground and have your lunch stolen and want to get your own back now you are big boys?

    BluePeter said: Suggest you give hand 1/4 your wages to some poor South Auckland family.

    I do! Well not sure about the exact ratio, but I do it through the tax/WFF system, and am quite happy to do so. And the more we earn, the more we can afford to hand over to those less fortunate financially than we are. They need the money and I do not.

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  47. “Suggest you give hand 1/4 your wages to some poor South Auckland family.”

    actually I can’t spare that much of my income because I don’t make a whole lot more than I need. I value time with my family much more highly than making money I don’t have a use for.

    greedy are those people who work 70 hours a week so they can afford 3 houses 4 cars and a yacht while their children get to know their nannies better than their parents.

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  48. >>what happens, as say in the real world, when the pie, at least the material pie, is finite?

    Perhaps whale oil will run out one day!

    Perhaps we’ll value experiences more.

    >>did you always get beaten up in the school playground and have your lunch stolen

    Not once. And I went to a rough school…..

    >>I do it through the tax/WFF system

    There is no virtue in compulsion. I’m saying equalize your status with others, commune stylee. Anyhting else is just greedy.

    PS: Why don’t Greens live on communes?

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  49. “Why don’t Greens live on communes?”

    wanting the economic/political system to provide a decent standard of living for everyone does not make someone a communist. I resent seeing the struggling people in some areas of auckland when contrasted against the wasteful indulgent way that others live. the real drinkers of the champagne are reaping off the spoils of NZ’s economic activity while those that work hard to turn the wheels struggle.

    I TIRE OF YOU TROLL

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  50. Nommopilot,
    Its all about opportunity cost. It wouldint be logical for you to live in South Auckland as oviously, if you can earn 50+ dollars per hour working, then the opportunity cost of traveling would outweigh the benefit gained from lower cost accomodation. However, if you were low on skills and on a minimum wage job then the value of that time is significantly less and as such the money saved in weekly outgoings may well be justified.
    I chose to study in palmerston north precisly because it met my requirements; cheep accomodation, short commute, employment, and the university is in the forfront of my areas of interest. Oviously if you choose to study in auckland you consider the benefits to outweigh the costs, you could live somewhere cheap but you choose not to. Im 100 metres away from work, 12 minutes walk to town and the main bus terminal, 20 min bike from uni, 2 minute walk to a university busstop which takes half an hour to get to uni, near several main bus routes, just accross the road from two supermarkets, a bulk store, a vege shop, the saturday market, two booze shops, two video stores, subway, dominos, pizzahut, and two fish + chip / chinese takeaways. To me the cost outweighs the benefits.
    If your on minimum wage you have a choice; live where you can afford to and take the commute or shorten the commute and take a loan. The fact is you can survive easily if you get your priorities straight.
    My math stacks up, my logic stacks up, and my understanding of economics and choice obviously far surpasses your own.

    What you seek may not be communism, but the dissociation between action and consequence, and from reality, is no different.

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  51. “If your on minimum wage you have a choice; live where you can afford to and take the commute or shorten the commute and take a loan. The fact is you can survive easily if you get your priorities straight.
    My math stacks up, my logic stacks up, and my understanding of economics and choice obviously far surpasses your own.”

    sure, they have a choice but it’s a crappy choice. you’ve found a great little niche and can make things work for yourself, being single and having found cheap accomodation with people who aren’t psychos (touch wood), but these things are not commonplace, especially not where the jobs are in greatest supply. You are in dreamland if you think that most people on minimum wage are in a similar position to you.

    “the dissociation between action and consequence, and from reality, is no different.”

    I am only too aware of reality, this does not mean I can’t express dissatisfaction with it. there certainly is great dissociation between this world and one where everyone has the opportunity to make a decent living while still having a decent quality of life.

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  52. Nommopilot,
    I just had a very quick look on trademe, I looked for flats under auckland; on the first page alone there were several central locations; 135, 130, 130, 110, 120 per week costs included. not exactly extreme. Then i looked at rentals, just so you can start your own flat to avoid those *psychos*, on the first page there were a fair few marked central, many coming to around 70 per week per person, assuming full accomadation.

    They have a choice, and they can survive on those choices relativly easily and as such the minimum wage, even for someone working well less than standard part time hours, is more than enough for subsistance. So the only reason the minimum wage should increase would be if you wanted to create even more unemployed so that you finally have your proletariate army; ah hah! thats it! I now know your motivations for such obviously economicly illiterate practices!

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  53. When sapient said ………….”wonderful accomodation, plentyful high-quality food, excessive power and internet, and heat.” …………. he was talking absolute rubbish.

    No one else could live to this pie in the sky budget and his less than $30 per week on food suggests he’s quite thin …………

    He’s also living in some hovel or out in the boonys where it must be a long way to travel to work………….

    Actually I’d call him either a hermit or a liar ………… still nice to see BP and the other natianal trolls think he’s a legend.

    Also interesting to see what the natianal crowd think of the aussie minimum wage ……………. is their higher minimum wage a motivation for people to head over there ????????

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  54. $120 per week for your total living costs ………….. for wonderful accomodation ………. high quality food ……excessive power ……………..

    What else do you fantasize about ???????????

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  55. Those on the minimum wage should be extremely thankful to John Key and the National party.

    A far better idea would have been to reduce the minimum wage, however I suspect that those who are currently celebrating their unearned wage rise should not get used to the extra money.

    Because of this stupid decision by Key many of these low paid will have to get used to living on less when they are unemployed, surely a full time job on $9.00 to $11.00 per hour is better than no job at $12.50.

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  56. Frog, can you update me on your tax policy?

    You said that $10,000 is tax free as Green policy. Is this now a baseline policy with no quid pro quo, or is it still part of the Eco-tax policy?

    If part of Eco-Tax, it would mean that in exchange for a $10K tax free threshold you would apply different (new) taxes to achieve a neutral effect (for example, adding a tax on diesel). Is this the case?

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  57. Sapient –
    ROFL.
    I’m wheat allergic.

    I live on rice, corn, & pulses, mostly organic, which have been soaring in price over the past 12 months or so.

    I also grow some of my own organic, GE-free veggies (albeit with difficulty in my current flatting situation, which has not had a serious garden for decades, and I’m the only gardener …), and even sharing an old villa with others, we struggle, mainly due to an uninspiring landlord who is waiting for the house to fall down so she can re-build on the section.
    There’s not a skerric of insulation, and a deep reluctance to address even necessary maintenance issues. While assiduously banking our rent into her “build a new house” trust account.

    I can only conclude that you’re living in one of the less avaricious provincial towns, where there aren’t enough tenants to go round the property speculators who own all the rental housing … ;-)

    BP –
    I’m also yeast allergic, which knocks out any kind of wine or beer.
    NOT a chardonnay/champagne socialist by any means.
    More inclined to a decaf latte, or a herbal tea with honey in it…
    Ok, I’ll cop to being a latte socialist.
    Especially if Keith is buying my latte … :-)

    I’m with Sue B on this policy issue, we’re letting the people at the bottom of the heap take a beating, so that those with assets can maintain some sense of confidence in ‘the market’.

    Read some news from outside NZ, guys. The media here are just pandering to their advertisers – out in the real world, it’s being noted very well that businesses will be going belly-up at an astounding rate, as the ones who rely on borrowing other people’s money to underwrite their operations, discover that a stringent look at their finances shows them to be a bad risk, and an unsustainable business.

    The Dompost ran one or two stories today, hinting that they’ve taken their collective editorual heads out of the sand, but really, some of the finance company failures they’re reporting now happened pre-Xmas, back in the States, and were in all the European papers & magazines in th New Year issues.
    6 weeks ago …

    God only knows what they’re not talking about in the business section here now, if they’re finally reporting those ones.

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  58. >>Read some news from outside NZ

    Just did.

    Looks like the Australian environmentalists are going to take some serious heat (!) over their protection of natural, growing fuel.

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  59. >>businesses will be going belly-up at an astounding rate,

    You’re young, eh. Us oldies have been through this all before. It’s the 80s crash all over again, however thanks to Rogernomics, we’re going to pull out of this one sooner than most countries.

    So long as all our partners don’t go all protectionist, expect uptick towards the end of the year.

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  60. >>however thanks to Rogernomics, we’re going to pull out of this one sooner than most countries.

    Didn’t *all* developed and/or western countries go Rogernomics-y in the 80s?

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  61. all this talk about champagne socialists is rubbish. Most of the green voters I know are heroin addicts

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  62. Katie,
    Lol, admitedly i made that post thinking you were vegetarian/vegan.

    DaddyO,
    Accually, i am considered obease. Im 100 KG and 6 foot.
    We do communal cooking, between four people. 7 dinners per week, plus breakfast and snack material. i average about 11-12 dollars per meal for four, my flatmates tend to avearge between 12-14. so assuming i cook twice and my flatmates each cook twice save one that comes to about 88 dollars per week on dinner, between four people that is 22 dollars per week on dinner. i dont know our power costs as i dont pay that bill. our internet is a 20 dollar base rate plus 10 dollars per ten gig. At the moment with two occupants we are doing about 30-40 gig per month, with a full flat we tend to do 60-80, that bill is distributed over the month. we use a wood burner for heat and get wood for free from my flatmates family or various other aquatences. Sometimes the excesive internet does put us over budget, but for the vast majority we stay inside. Though i do admit that we have a new efficent hotwater heater since the old inefficent one broke down, the swaping between the two may have helpd protect us alittle against the inflation, though before the recession hit we were about to increase the board by five dollars :P .
    But enough about my finances and personal life. Why should the minimum wage increase given that i can survive on 12 hours work per week and the minimum wage is targeted as subsistance level for full time workers?

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  63. Katie – if you read the thread you would now that Sapient lives in Palmerston North.

    You wrote”I can only conclude that you’re living in one of the less avaricious provincial towns, where there aren’t enough tenants to go round the property speculators who own all the rental housing …”

    Is this social/intellectual snobbery – yay you for choosing to live in Wellington and to eat organic – both choices that means you pay more for your lifestyle whilst forgoing other opportunities.

    Nommopilot/Frog – Life is pain, anyone who tells you otherwise is a liar or selling you something (from the Dread Pirate Roberts).
    Or just as easy to say that there is an opportunity cost to the choices we make, some are easily to identify as direct financial costs, others are our time (note time is money), others our social connectedness and enjoyment of amenities. Growing the pie when there is finite resources requires recognising opportunity costs and being clear that are choices have costs. then we can identify the thngs we want and what they cost us individually and as a society. We can then prioritise activities that provide people individually and as a society to operate at there optimal level. Productivity improvement allows us to make greater use of existing resources increasing the pie for individuals and for society. Failure to do otherwise is to waste scarce resources.

    We are allowed to care about people, but we need to offer real solutions and not band-aids. The proposed minimum wage from Sue Bradford is just a band-aid and creates a higher risk of harm over the short, medium and long term. It dangerous effect is addding to potential inflationary pressure and generating unemployment. Inflation eats away the spending power of the low income and is effectively a tax. There are many other factors that influence inflationary pressure, but all should be addressed and the costs acknowledged. Anything else is the same as buying an indulgence allowing you to feel like your doing something for nothing.

    Being Green is an expense generally only afforded by the well off. The Green MP’s already now that they are members of the elite and often many green supporters are also. A reasonably educated elite, but a wealthy elite none the less. The problem is that this champagne socialism means few recognise the costs (real and opportunity) that they impose on individuals and society. To some buying organic means travelling from Oriental Parade/Mt Vic to the organic store and paying up to $200 a week more for the groceries than at Pak and Save. Pak and Save and the warehouse have done more for addressing poverty than any campaign for organics, protectionism, minimum wage.

    Sapient should be applauded for making choices to pursue education, contain his/her costs and still try to make the world a better place without passing on costs to others. I don’t need to defend Sapient, he/she is more than capable of doing so.

    Katie if you only just noticing the credit crisis you should have a look at interest.co.nz, Dim-Post, EconTalk, Marginal revolution, undercover economist, the visible hand in economics, mises.org and basically any other economics/business blog (give some of the above a google and read). This has been known for quite some time and been a worry for a long time before the herald, Dom-post, New york times and guardian noticed it.

    Many of us have spent some time warning of it, but there was too much of a party going on. So there is a story of a hangover taking place. The origins of the crisis have little to do with capitalism and a lot to do with human optimism about a low risk future.

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  64. mistywindow says “With bugger-all natural resources Luxembourgers earn 2.5 times as much as Kiwis. Slovenia and Portugal have passed us. Turkey and Mexico are hot on our tail.”

    After WWII Luxembourg structured it’s corporate laws to attract the investment banking and reinsurance industries. Now it is the Wall St of Europe, in much the same way that Hong Kong has that role in Asia.

    Slovenia, Portugal and Turkey passing us? Nothing to do with EU membership of course. Likewise NAFTA hasn’t helped Mexico.

    Ranked on the average of the WB, IMF and CIA PPP-GDP per capita these are the territories that are within a few thousand bucks of NZ:
    Faroe Islands
    Greece
    Italy
    Taiwan
    Monaco
    Macau
    Slovenia
    Cyprus
    New Zealand
    Israel
    Bahamas
    Equatorial Guinea
    Falkland Islands
    Liechtenstein
    South Korea
    Czech Republic
    Malta
    Trinidad and Tobago
    Saudi Arabia

    But looking at the top of the list provides some important clues on how to get rich quick:
    a) sell oil like there’s no tomorrow
    b) provide a money hiding or laudering service
    c) attract creative investment bankers

    Bermuda
    Qatar
    Luxembourg
    Jersey
    Norway
    Brunei
    Singapore
    Kuwait
    United States
    Guernsey
    Ireland
    Cayman Islands
    Hong Kong
    Switzerland

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  65. Freakonomics is also a great book for those interested in economics, minus the gobblygook. It tells stories about real people, and the impact of economic decisions.

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  66. Freakonomics is indeed excellent. Heard about ‘Freedomnomics’ BP?
    http://en.wikipedia.org/wiki/Freedomnomics

    Appears to be a partial rebuttal to a bit of what was in Freakonomics, but i’m not sure if that really matters if it makes people appreciate the long-run effects and/or consequences of creating new or different incentives for people in all spheres of life.

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  67. also add The undercover economist http://www.timharford.com as a good read. Freakonomics is definitely worthwhile. Nudge http://www.nudges.org for a behavioural economics view, Nial Ferguson http://www.niallferguson.com for the ascent of money a great book on the build up to current economic problems – also I understand being made into a tv documentary and probably available on youtube.

    you may also want to read these peoples work also http://en.wikipedia.org/wiki/Adam_smith – people should read both “the theory of moral sentiments” and “the wealth of nations”

    And not to forget http://en.wikipedia.org/wiki/Friedrich_Hayek

    enjoy

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  68. Yes, the Undercover Economist is cool. really enjoyed it.

    Apparently there’s a sequel to Freakonomics due out soon….

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  69. Apparently there’s a sequel to Freakonomics due out soon….

    Excellent – will keep an eye out for it to add to my library.

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  70. Well actually sapiant lives in a rural town with its naturaly low rents.

    Not one of the main centres with their higher rents ………..

    Sapient is probably obese because of the low grade fatty cuts of meat and cheap food they eat.

    His internet is cheap ……………….. but no mention of the cost of his computer to get on it.

    He claims his fire-wood and heating is free ………………… no mention of petrol costs, chainsaw cost or even acknowledgement that not evey-one can get “free” heating ………………also no value is put on his time in getting the firewood.

    In short sapients claim that we could all live well on $120 per week is rubbish.

    Sapient might think he’s living well ……………. but I probably think he’s slumming it.

    But enough of him ………..

    I think we can sum up by saying Being green or caring about social issues seems to be a cost natianal supporters can never bear to pay …………………………

    They pretend to know the cost of everything ……………. but know the value of bugger all

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  71. WHWS commented…

    nommopilot – your problem is that you choose to live in pt chev for a variety of lifestyle/work/study reasons. Other people like sapient might choose a different location where they can lower there living costs and still maintain a lifestyle of their choosing.

    Both nommopilot and sapient are privilaged to have choice. nommopilot due to being able to earn $50 per hour (good on you nmp) and sapient due to having no dependents and being a student enjoying a student lifestyle (mostly work, cheap play).

    For a lot of people there is no real choice. nommopiolt may experience the joys of loosing the $50/hour, and be unable to replace it. What should he do then? Move out of the area in which all his social connections are?

    This is one of the many failures in Hayek’s analysis. Not including in his models the effects of disparities in economic power. Currently nommopilot and spaient both have a lot of that. Most people on low incomes have very little.

    Nommopilot/Frog – Life is pain,

    What a sad sad thing to say! Without pain, true, there is no life. Without love, joy, bliss(!), sex, music, food…. there is no life.

    Life is Joy!

    Life is Love!

    Yea yea. Life is pain, for some.

    To some buying organic means travelling from Oriental Parade/Mt Vic to the organic store and paying up to $200 a week more for the groceries than at Pak and Save.

    You do get close to the real problem. I do not eat only organic food as even though we have a good income in my family it is too expensive, and, ironically, to low quality in a lot of cases (the best fruit and vegetables I can get in my area are not organic. In other areas the story is different)

    The real problem is that it costs roughly the same to eat high quality food that involves quite a lot of preparation (my lifestyle) as it does to eat a highly processed high salt/fat/sugar/simple carb diet. As we Greens never get tired of pointing out pop is cheaper than milk.

    This is the market at work. People with little money can afford to buy the highly processed comfort foods. In the long term it wrecks their health but markets have no cognisance of the long term. How could they?

    peace
    W

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  72. BP –
    flattery will get you no-where!
    Although I’m pleased that you think I project as a much younger person, I too survived the ’87 crash, albeit with less assets than in Sept ’87.

    Bliss – great points!

    Sapient – my comiserations, Ilive dinPN during my youth, and got the hell out asap, when the choice of where to study was mine, My current academic discipline limits me to a choice of HAmilton, Aucklland, Wellingotn or Dunedin;

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  73. Despite living virtually on the minimum wage myself, I for one, believe that it would be a stupid time to increase it. The world is now in the midst of a deflationary crisis and profit margins will continue to squeezed as firms are forced to lower prices in order to sell their excess inventory.

    So far it hasn’t registered here, because our falling dollar has insulated firms here from competitive pressures from overseas, but there are signs that it won’t last as our dollar strengthens.

    Speaking from personal experience of someone who actually lives very close to the minimum wage ($12.00 p/h), I don’t find it particularly onerous to live on my income. To be sure I have no dependants and I choose to board with a family, so I pay low rent ($60 p/w), I live 6 km from work, but I either car pool or cycle so my transportation costs are minimal.

    As for couples who must subsist on a minimum wage with dependants, surely thats their choice and they should live with it. In actual fact they already pay very little tax anyway if they are on Working for Families and have an accomodation supplement.

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  74. [.. sticky fingers, continuation of sentence - ]

    *ahem* … oh, yeah, Hamilton, Auckland, Wellington or Dunedin; so inertia has kept me in Wellington for various reasons, mostly family-related, for a couple of decades.

    I am not a Keynesian economist, or a fan of the Chicago School or Milton Friedman; I have studied feminist economics, which works to a paradigm of sustainability, that is outside most current business frameworks.

    I *have* been warning younger collegues on campus, not to buy into the property market, as prices are excessively over-heated, & they could end up with a debt greater than their true equity within a very short time. (ie: negatively geared mortgage)
    And also, to reduce their consumer debt to easily manageable proportions.

    I live on a very low income, & have years of practice, while finishing my two degrees, on how to keep myself going on very little.

    18 months ago I was laughed at as a doomsayer, since none of this advice was being promulgated in the local papers (who just said ‘spend, spend, spend’).

    6 months ago, some of my acquaintances began to pay attention.

    2 weeks ago, I was giving ‘how to survive’ advice to a young man I’ve known for a long time, who said “we’re the generation who have never known a recession – we don’t have a clue how to live without all these credit facilities!”
    He was genuinely concerned about how his younger friends, still students, would cope, as the magic top-ups from parents and relatives failed to materialise, and the credit cards stopped increasing their limits towards the sky.

    In the past 5 years, I’ve known students with an overdraft at each of the banks, and a credit card off each, who regard the Orientation banking scramble for customers as no more than a lolly scramble to be taken advantage of.
    How these now-graduate students will cope, is a worry.

    I’m sure many will file bankruptcy, as a way of continuing to be able to survive on their modest incomings, since most I know are doing post-grad while on fixed income from scholarships, or minimum-wage top-up jobs, which are a limiting factor in their research time.

    It’s the same mentality that saw a mass of students marry in on-campus stunts, designed to take advantage of the student loan loop-hole around parental income threshholds. – ‘how do we survive a frankly rotten policy?’

    No mistakes, BP
    - we’re in for a bumpy ride to the bottom, and the soft-landing Allan Bollard was trying to effect is a myth, we’re in for a short, sharp shock of a hard landing.
    There are bankruptcies and redundancies happening all over the place, if you bother to read the papers effectively.
    How many of these businesses will start up again, promptly, under another name is nobody’s guess – but it was the classic response in the early 90′s.

    Except for Marac, of course, which folded due to an over-abundance of low-equity mortgages, which lost all their equity and caused the building society to collapse in ’92; I knew some lawyers and property speculators who lost a bundle in that one, and we bought our first house in the fire-sales that followed. It took 4 years to regain the equity, during which time we did some renovations & added sweat-equity of our own.

    I’ve never once considered a leveraged-mortgage property investment since, it’s the best way to see the equity in the house you’re living in gobbled up by the decreasing equity in properties mortgaged to the hilt, which fail to return sufficient income to cover the debt repayments.
    I’m sure some ‘Mom-n-Pop’ investors out there are finding this out right now, as they try to refinace loans on over-valued properties bought at the peak of the bubble.

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  75. Bliss – you completely miss the point when you say there is no real choice. Everything we do is a choice. Saying someone has no choice is straight out lying and intellectual laziness. We may not like it, we may feel it is below our dignity, our pride revolts and we fear the unknown(hmm Yoda said something about fear…). But we do have choice and some of those are doing jobs that we may feel are not quite us, but they pay the bills.

    Life is more than just pain (you also seem to have missed the whole reference to The Princess Bride – hopefully you do engage in pop literature/films from time to time for pure enjoyment and laughter). But anyone that is offering the free lunch your trying to sell is only offering long term pain. Are you a laon broker by any change offering a Ninja loan, because that essentially is what you are suggesting.

    Organic is expensive in NZ because it is inefficient and has reduced productivity in NZ. We don’t have a european or US farming system. people forget this. The drive for organics in the US and europe is a drive for a premium product that has taste adn is well produced. NZ already does this. We have the most productive land in NZ and essentially what NZ provides is what most europeans and americians dream there organics could be. It should also not be forgotten that organic production includes the use of fertilisers and pesticides. Its not the bliss that is presented by its advertiser in NZ.

    Buying pop vs buying milk – again that is an issue of choice and education. If you haven’t noticed the market does provide ethical and healthy food. Witness the rise of the celebrity chef and masses of books about healthy eating including the basic edmunds. There is also Jenny Craig and weightwatchers which in essence are about providing healthy eating and lifestyle.

    You can do a lot with food and choosing good food cuts. Peasant food is great as a comforter. Mince can be made to go a long way through spag bowl, potato pies etc. Rice also provides a fanastic base for a morrocan spiced meatball dish (again using the mince). A little use of garlic and stock, plus a touch of herbs does amazing stuff. This is all about choices. If your worried about people makning the wrong choices then you might want to read nudge to see how people can be helped within the market to make better choices.

    Katie – why commisserations for living in Palmy, is that just more rural/university snobbery? You are dangerous close to the insultated elite that is driving an old fashioned paternalistic/conservative view of humanity, which is wrapped up in the guise of the green party. How about recognising that living in a rural centre still enables Sapient to enjoy libraries, entertainment, good coffee and great food, a good university and a variety of job opportunities. Some may not be the highly specialised as what you have your heart set on, but they may also provide quicker promotion, variety and challenge. Oh and a better work/life balance whilst still having the ability to travel. Its about choices.

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  76. Katie – your post at 11.01 – quite good actually. I should point out that Bollalrd, Brash and others have been warning about our excesses. They have “hoped” that the RBNZ interventions could help produce a softer landing, but they damn well were pointing out that they couldn’t stop the stupidity by themselves and if it carried on it would be a hard landing.

    You need to look more at the role of fiscal stimulus – have a look at the treasury fiscal impulse graphs over the last 6 years regularly telling the government that there policies only added stimulus and made monetary policy difficult (read – RBNZ won’t like this and will increase OCR to try and address the problems you are creating, but even then they can only do so much and it will all end in tears before bedtime).

    Well done for being a risk aware person – we need more of those in the economy as well as social and business entrepreneurs who can generate productive improvements for our economy/society.

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  77. >>feminist economics

    Wonder when we’ll get a course in Feminist Engineering….

    >feminist economics which works to a paradigm of sustainability, that is outside most current business frameworks.

    That means exactly nothing. Business must be sustainable, else it ceases to be business, and becomes known as “bankrupt”.

    >>we’re in for a bumpy ride to the bottom, and the soft-landing Allan Bollard was trying to effect is a myth, we’re in for a short, sharp shock of a hard landing.

    I’m a client of Gareth Morgan. I’ll take his knowledgeable view over someone who studies “feminist economics”, whatever that is (sounds like a sociology course)

    We’ll take a hammering – there is no doubt. But the world needs our stuff. We’ll get uptick sooner than most….

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  78. Katie,
    So many teens seem to want to get out of palmy because its so small, only about 80,000 people :P , but i dont get it personally. Though i suppose itis exactly the same as how people seek to leave New Zealand as it is “too small”. I love palmy, i think its a wonderful city and it provides in excess of everything i need. On top of that the streets are logical and gang problems are, while rising, minor compared to the other centres. It may only be the 11th biggist city in NZ, but if i were to have to put up with auckland i would likley shoot myself and if i had to put up with the arts scene of welly id likley shoot someone else. Palmy suits me, once i finish my degree i may even run for one of the seats.

    DaddyO,
    I am obease because, even on that small budget, i routenly eat servings equivlent to 2-3 standard meals and i spend all my day sitting on my ar$e reading. Also, i dont like meat so i tend not to cook it, but when i do i always choose the prime cuts or premium mince. As for my internet, its availible nationwide but better deals are availible in the centers. My computers motherboard doesint even support DDR2 but it does have SATA compatibility, i run 512 ram and a ubuntu OS, i have 120 Gig SATA hard drive, inbuilt sound, video, and ethernet, my computer is old, i would hardly insure it for more than 200-300, i dont work 12 hours per week, i work 18, but the excess goes to saving and one of purchases which are not at all neccacary for my survival.
    I never once made the claim that everyone could support themselves on such a wage, i mearly stated that i could be working only 12 hours and support myself in a manner that fulfils all of my needs and wants (except i wouldint have enough money to go out drinking, not that i would anyhow) and used that as the basis of an arguement on compromise and choice.
    The minimum wage is ment to allow a person working full time to accheive subsistance level. 12.50 per hour * 40 hours per week * 0.80 percent after tax = $400 after tax. You cannot say that that is insufficent to support ones self, even in central auckland, if the correct choices are made. Its all about choice and how one values ones time and effort, many people have allowed expectations of a bright future to overvalue their time and effort and as such to make choices and commitments they cannot contain, that and some (like anyone getting a mortgage these last few years) are simply idiots.
    $400 is far in excess if you dont have dependants and if you do then WFF steps in and you can still survive easily with one or two dependants due to economies of scale. But i would sugest that if you dont have the skills for higher paid work and you are pregnant you should; A) get an abortion, B) adopt out, C) Train up. In this society there is no excuse for not surviving.
    I think fertility treatment should be means tested :P

    WWHS,
    Not that it really matters, but since your’ve gone to such efforts to say “He/She”; Im male :P Though the number of feminism papers ive taken may bring that into question in the minds of some.

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  79. Also, in addition to that $400 after tax there is overtime and such which, if someone is still strugling, they can undertake to assist their inability to budget.
    I love this new $12.50 rate, the math works out so well :P

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  80. Opps, I appoligise, $120 per week comes to 11 hours per week, not 12; i forgot that the lowest tax rate is 12.5% not 20%, lol.

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  81. Frog, it is already a godsend that this supposedly economically-prudent and fiscally-conservative National Government has even raised the minimum wage.

    In these difficult economic times, the last thing we need is businesses forced to downsize or go under altogether due to yet more imposed compliance costs.

    Workers will be more badly affected by redundancies than so-called “low wages”. By putting the squeeze on businesses, you are consigning the most vulnerable members of society to the inevitable prospects of unemployment.

    Some pro-worker party you are.

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  82. Nobody automatically deserves a “living wage.” The jobs we are talking about are student level and part time. If any adult is affected by minimum wage laws then they should ask themselves how they managed to make it so far, apparently without aquiring any worthwhile skills whatsoever.

    As workers, we are all selling our labour. Minimum wage laws simply mean that we are forbidden by law to sell it below a certain price. This has been likened to someone trying to sell their car: It may only we worth $6000, but the state now forbids them from selling it below $10,000.

    If someone’s labour is worth less than the minimum wage – perhaps because they are an immigrant or were let down by the public school system – their best chance is to get into work at whatever price they can get, and build up their skills and value from there.
    And don’t forget, the state is going to top up their wages anyway. Better to have people working and learning in this way, than being subsidised even more by the state to sit at home.

    Ultimately, minimum wage laws are not about helping the “poor.” They are about making political gains for its proponents, who are able to depict themselves as champions of the masses despite the fact that the actual result is higher unemployment.

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  83. Dead right, wat dabney.

    The problem with the left is they have manufactured a plethora of rights. The right to free education. The right to a living wage. The right to be unionised. The right to social welfare. Blah blah blah.

    We have allowed the left to infiltrate our consciousness and tell us that these are ‘rights as of right’. And with these rights, obligations are placed on employers, the state, and so on.

    That is why we now live in an age of political compulsion. Employers are compelled to pay a minimum wage. And the state steal our money in the name of compulsory taxation, so what those who do not work may have a “living wage” in the form of a welfare cheque.

    Despicable.

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  84. How does one determine just what a job is “worth”. When it comes to buying cars, labour or anything else, it seems to be the market that decides. But isthis a fair means of determining worth? All it means is that those who pay decide what you are “worth”, regardless of what you are really contributing to society. Are cleaners, nurse aides, lifeguards, volunteer firefighters etc. really “worth” less than high powered corporate lawyers. I earned a lot more as a paper shuffling public servant than I do now as a teacher, but I consider I am now a much more productive member of society and making a difference to a great many more people. Wen I was on the dole I also did a considerable amount of work raising awareness of the inhumane nature of factory farming in New Zealand, work that is extremely valuable and worthwhile, but unfortunately the animals who benefited could not afford to pay me.

    It is just that the public servants and corporate lawyers are what the rich and powerful want and are prepared to pay for, so it all comes down to disparity of wealth and power, something the minimum wage is trying to address.

    If you think disparities of wealth and power are right then I can understand being against raising the minimum wage, but otherwise it makes no sense to say that we must let the market (largely determined by those with wealth and power) decide.

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  85. Katie,
    Worth is a representation of the utility value of one thing to another thing which seeks that utility. So the one that is to detirmine how much a given thing is worth is the thing which seeks to utilise it. worth is detirmined mostly by supply and demand, as applied to jobs it is supply of workers with the required skills, experiance, and traits vs the demand for workers with said characteristics.
    There are lots of teachers, and most of them might as well be retarded (c’s get degrees huh? should shoot them!); its a low skilled profession, so short of a major boom in job vaancies or a bomb at a teacher conference the worth and associated pay will oviously be far less than the corporate lawers which are in much shorter supply compared to demand and are much more highly skilled.

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  86. Sapient

    Skill is not a measure of the number out there but is a measure of how good you are at something. It is morally neutral. you can be a very skillful murderer for example. Worth is something different; it is a moral value and can even be negative; viz the very skilled murderer has negative value to society. But pay rates depends on who is paying, which is the point I made.

    The skilled murderer, in spite of having negative worth to society as a whole, could command a high salary because those with money and power want his or her skill. Skilled teachers in New Zealand are not paid well for various reasons, one being that students are poor, another being that society as a whole doesn’t value education and maybe for historic reasons. In contrast, teachers are paid more in places like Japan not because there are fewer of them but because society values them more (ie those with power and prestige and influence in government place more worth on them and use their influence to get them more pay). the point I am making is that worth always has an object, something has worth TO another, not in itself.

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  87. Kiore,
    Worth is mearly another word for value, and value is a subjective judgement of the utility of one thing to another thing. So while yes, a skilled murder may have a negitive value to society they may have a positive value to a company that specialises in assasination.
    What I was attempting to say, and thought i did, is that to an employer, or a group of employers, the apprasal of the value of a given individual is based the skills, traits, and experiance of that individual, the demand for those skills by those employers, and the relative availibility of individuals with the required skills plus the possible premium for skills over what is needed.
    The reason an assasian would be payed a high amount is because the relative availibility of people willing to be an assasain whom posses the desired skills to properly do the job.

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  88. Sapient:
    Utilatarianism:’Greatest good for greatest number’: ( As per Messrs Bentham and Mill.) But how do you determine what the greatest number is? Is it a purely anthropocentric concept? In which case we need to ask ourselves what is best for most human beings? And is this just those human beings alive today or indeed the whole human species present and future? Also, can this theory accomodate the deprivation of the minority at the expense of the welbeing of the majority?
    Perhaps we need to also give some credence to the two traditional rivals of utilatarianism: namely deontology (rule based ethics) and “virtue” ethics (going back to Aristotle – giving weight to attributes such as courage, honesty and wisdom).
    I am aware that deontology rests most comfortably with many religions (compare: ‘Thou shalt not…’) but nevertheless it may well have a deep evolutionary basis.
    Virtue ethics, by centering on the individual’s personal character, provides a possible insight into the relevance of individual responsibility.

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  89. Kjuv,
    there are many forms of utilitarianism, the term itself is more of an umbrella than a descriptions as such.
    My particular form may be considered a virtue/act based gaian survivalist-utilitarianism or gaian survivalist-eudeimonism where the virtue of an act may be detirmined by its contribution, or detriment, to the ultimate survival of gaian life for the longist practicable time at the highest satisfaction to the most.
    deontology certainly has a deep evolutionary basis, infact that is the very reason we have heuristics, because they offer great advantages when making decisions. heuristics were almost certainly the main driving force in the development of cognition. morals are themselves little more than heuristics applied from above, serving to guide the masses in their daily activities in ways that are unlikley to do harm to society or the status quo whilst others in more powerful positions with more knowledge make judgements on direction and action unbound by such things as morals.

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  90. kiore1,

    There are many more interesting things I’d like to do for a living, and I’m sure most of them would give me more of that warm, fuzzy feeling that I am helping people. However, I do the job I do because it pays the bills.
    You, apparently, have chosen a slightly different balance. You forgo some income in order to get more of the warm and fuzzy intangibles. That’s fine, but please don’t expect the rest of us (in the cheerless jobs) to subsidise your choices: You maximised your utility by becoming a teacher in the same way that we maximised ours. Economics is never just about money. Just because you opted to place yourself at the sharp end in order to reap the feel-good rewards of working with children doesn’t mean you have any more worth than anyone else working anywhere in the economy.

    In the private sector, the market determines wages. Subjective ideas of “worth” have nothing to do with it. The result is that we magically end up with roughly the right number of nurses, teachers, cleaners, engineers, jewelers, house painters, plumbers, farmers, taxi drivers, book sellers, watch repairers, hot-dog vendors etc.

    Clearly, no matter how much you “care”, you could never hope to grasp even a fraction of the complexity of this market and the infinite number of trade-offs all the participants are making, nor have the faintest idea about allocating resources (workers) to the countless job-types. The Communists tried this and were necessarily authoritarian and appallingly inefficient.

    The problems arise when there is no free market (or in the provision of “public goods”.) Suffice to say that these situations should be reduced as much as possible, so markets can operate.

    - “If you think disparities of wealth and power are right then I can understand being against raising the minimum wage, but otherwise it makes no sense to say that we must let the market (largely determined by those with wealth and power) decide.”

    You seem to think that raising the minimum wage is like waving a magic wand – a cost free solution – but it isn’t. By how much are you raising unemployment, particularly amongst the young and ethnic minorities? So let me rephrase your comment: “If you think youth and minority unemployment are right I can understand being in favour of raising the minimum wage.”
    And you profoundly misunderstand free markets if you believe they are determined by those with wealth and power. Such people fight against free markets, not for them.

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