by frog
Remember Snowball, Squeaker, Old Major, and Napoleon? For those whose high school English class was some time ago, they’re the oinks on Animal Farm who said ‘All animals are equal but some animals are more equal than others’.
There’s a whiff of Orwellian oinkerism in the Government’s Securities Disclosure and Financial Advisers Amendment Bill that came to the House this week and which the Greens opposed.
Donning his cape and summoning his super powers, Commerce Minister Simon Power sees himself rescuing New Zealanders from redtape (which I guess makes him a Power Ranger?)
Like the pigs, Simon-the-Power-Rangers’ Bill says everyone’s equal, but some are more equal than others. Apparently special investors – those who regularly invest sums of $500,000 plus – are much smarter than the other animals in the farmyard and don’t need to be bothered with tiresome disclosures
But as Green MP Kevin Hague noted:
How about all the good and the great, the experts who have lost their shirts investing in Madoff’s transparent Ponzi scheme, just like the aeroplane game and numerous other pyramid style investment and money-making schemes that plagued New Zealand in days gone by….This lack of expertise by so-called ‘experts’ was also demonstrated in the audit and accountability mechanisms in many of these cases. (full video of speech here)
The Greens were the only Party to stand against Power’s Bill. Perhaps the rest find it easier to grandstand when finance companies collapse than to tackle the serious work around the regulatory structures that can protect New Zealanders and our economy.
Kevin Hague stated that:
the Green Party wants to see rebuilt investor confidence, because that is the only way that we will reduce barriers to raising capital for good, sustainable businesses, and this will only be accomplished through greater disclosure, not less, and by a more active role from Government.
Yes that’s right ‘active government’ versus the discredited de-regulatory approach that helped fuel the international economic crisis.
And while we’re touring the animal kingdom, how about this quote from our man Kev:
The speculative economy perches vulture-like, bloated, flatulent, upon the shoulders of the real economy, weighing it down. It is failure in this speculative economy that now threatens the real economy in which people actually make products or services that others really need.
As I recall, in the long run, things didn’t go too well for the pigs either….
Published in Justice & Democracy by frog on Thu, March 5th, 2009
Tags: madoff, orwell, pigs, power rangers, securities disclosure
on the trolls and those who are unable to keep on topic
There’s a good (but hour long) talk about the current financial train-wreck, at the Ayn Rand Institute site:-
http://www.aynrand.org/site/PageServer?pagename=reg_ls_financial_crisis
As the guy says, finance is nothing like a free market; it is the most highly-regulated and controlled industry in the world. The result has been all sorts of moral hazards, as government insurance and subsidies created all manner of perverse incentives; leading directly to the recent meltdown.
Watch the video. He’s a down-to-earth guy talking common sense and talking from experience.
-”The speculative economy perches vulture-like, bloated, flatulent, upon the shoulders of the real economy, weighing it down. It is failure in this speculative economy that now threatens the real economy in which people actually make products or services that others really need.”
Spare us the self-indulgent teenage poetry.
Fannie Mae and Freddie Mac are absolutely central to this disaster and are to all intents and purposes controlled by the government, directed by the government and subsidised by the government. They were leveraged to the maximumum on sub-prime mortgages in the sure and certain knowledge that the government stood behind them.
Recessions are an inherent and essential part of any economy. In a free market that are mild but more frequent. But, for reasons of personal ambition, politicians don’t want them to occur on their watch, so they have kept pumping up the economy for years. The result of that government rigging of the market? An inevitable meltdown.
But let’s not allow facts to spoil our socialist fantasy. Let’s blame “speculators.”
The solution is less state regulation and control, for three reasons:
1) To ensure that investors act as prudently as possible, knowing the government is not going to simply bail out recklessness.
2) To allow freely-determined market prices to operate, providing the essential information to buyers and sellers. This includes allowing a natural rate of interest to operate, rather than letting the Fed manipulate it.
3) Because regulators are not the smart, omniscient demi-gods that statists seem to imagine. A lot of the time they are complete dicks. The current disaster did not happen because regulators lacked for powers of oversight or intervention; they had more than enough. The problem is simply that they were completely clueless, and there is no reason to believe they will do a better job next time.
For example: the recent unbelievable fiasco in Iceland. Surely British regulators should have had some hint that what was going on there was a financial impossibility? But no. Take this comment from a long artical in Vanity Fair: “In a sane world the British regulators would have stopped the new Icelandic financiers from devouring the ancient British merchant bank. Instead, the regulators ignored a letter Shearer wrote to them.”
http://www.vanityfair.com/politics/features/2009/04/iceland200904?currentPage=1
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> And while we’re touring the animal kingdom, how about this quote from our man Kev:
for a moment, I misread that as ‘our man Key’. I was thinking that maybe John Key had undergone a transformation comparable to the pigs in Animal Farm, but in the other direction.
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Socialists quoting Animal farm…in their favour…..I have seen it all….
LOL
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James Says:
March 5th, 2009 at 6:31 pm
> Socialists quoting Animal farm…in their favour…..I have seen it all….
you would probably consider George Orwell, the author of Animal Farm, to be a socialist too. Animal farm is not a criticism of socialist or social-democratic politics – it is a criticism of totalitarian communism, and I’m sure most greens would agree with it.
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“Apparently special investors – those who regularly invest sums of $500,000 plus – are much smarter than the other animals in the farmyard and don’t need to be bothered with tiresome disclosures”
Frog, that is similar to what happens in the States, you have investments that don’t have to go through the SEC which are open to those with incomes in excess of $200,000 for a single, or $300,000 for a couple, or an asset base in excess of a million (?). Needless to say, I disagree with such a system as it leaves the best investments for the wealthy, enabling them to get wealthier, while the common masses have to put up with sanitised investments.
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- “it is a criticism of totalitarian communism, and I’m sure most greens would agree with it.”
Except everything except Capitalism is totalitarianism. You can’t be partly pregnant.
Either you’re free to pursue happiness and dispose of the fruits of your labours as you see fit or, as the Greens and the other collectivists (socialists/communists/nazis) would have it, you are just a cog in their great society; a serf.
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The difference between socialism and communism…? A few years and the degree of dedication of its aderents….the former if practiced consistently arrives at the latter eventually.
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Mr dabney, let us pursue your pregancy theme a little.
Do you accept that there is some age below which people are unable to pursue their own happiness, by virtue of their lack of faculties?
If so, is there an age below which one’s happiness is determined not by ones choices but by the choices of people around us, typically parents?
And is there evidence that the choices made by the people around us have major impacts on how successful children are?
The answer is, of course, yes. And at this point I think your little capitalist utopia runs into an big dilemma.
To put it another way:
Society A) strives to create a society in which people are able to pursue their happiness somewhat independently of their background.
Society B) strives to provide a society in which people are able to dispose of your money, assuming you have it in the first place.
The problem with Society B) is that many people, such as children, don’t have money (thru no fault of their own) and as such are not “free”.
So the situation is nowhere near as simple as you make out; trade-offs are required.
Given this tension the more interesting question is how can we maximise overall freedom of expression?
An example may help. In Sweden every child above a certain receives an independent allowance, which can only be spent on educational needs.
Nanny state you I hear you cry, but you could not be more wrong. The allowance means that society expect far more of individual students.
So this policy is redistributing wealth (curbing economic freedom), while at the same time actually fostering individual expression/responsibility.
Ultimately the real world is more complex than your statements suggest, which make me suspect that you are some stage I university hack.
Otw, I agree – many regulations do have unintended and harmful consequences, and we should root them out like pigs looking 4 truffles.
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James
>Socialists quoting Animal farm…in their favour…..I have seen it all….
you should get a high-school english student to explain the layers to you
wat dabney
>Except everything except Capitalism is totalitarianism.
see above (except see a geography student)
>Either you’re free to pursue happiness and dispose of the fruits of your labours as you see fit
Do you mean: dispose of the fruits of your labour as you, in ordinance with what commercials have told you, see fit?
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# James Says:
March 5th, 2009 at 9:47 pm
> The difference between socialism and communism…? A few years and the degree of dedication of its aderents….the former if practiced consistently arrives at the latter eventually.
yeah right
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As usual I don’t really understand high finance except that it is obviously about using money to do the work.
Mere mortals trade work for money. Rich people use the money to do the work for them. Therefore economies are steered by people who don’t work.
Simplistic I know but it seems to be what high finance actually is.
Freedom is the choice to be happy. Self given. No one can allow someone else freedom… you just take it.
Anyways this thing about disclosure seems ass about face as the bulk of investments would be made by small investers and the percentage over half a mill would be quite small so how can there be significant savings by cutting red tape. Instead of being about cutting red tape it seems the bill is more about promoting wild life… red herrings!
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sdonovan,
Strangely, your argument invoking children reminds me of Christians comparing themselves to sheep; although in their case I agree with them totally.
But to address your broader argument: No, forcibly taking other people’s money in order to redistribute is never justified. It is mob rule. If 51% can vote to plunder the other 49% – unchecked by human rights – then there is no limit to what they will extract. The ultimate, of course, is actual slavery, where a majority voted to enslave a minority. It was all nice and legal. Redistributive tax policies are just a short way down the spectrum from there, but the same in principle.
Hundreds of millions of people would love to be able to live in New Zealand without any welfare hand-outs whatsoever, simply because of the great opportunities available in a rich country with lots of empty land. Why should native Kiwis be any different? Why should they demand a monthly hand-out and, in addition, be in front of the queue to receive it in preference to the billion people living on $2 a day?
If you’re going to coerce money out of people, why on earth would you consider giving it to people who are, comparatively speaking, nearly as wealthy as you? i.e. other Kiwis.
Why would your first instinct not be to give that money to the most needy and most desperate, i.e. people from among the bottom one billion?
the bioneer
- “Do you mean: dispose of the fruits of your labour as you, in ordinance with what commercials have told you, see fit?”
Yes, quite possibly.
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“Except everything except Capitalism is totalitarianism. You can’t be partly pregnant.”
Try anarchism – Orwell wrote very favourably of it in Homage to Catalonia.
“a rich country with lots of empty land. ”
Try telling those who own it that the land is empty.
“It is mob rule. If 51% can vote to plunder the other 49% – unchecked by human rights – then there is no limit to what they will extract.”
Of course, in the real world people are reasonable, and don’t practice the sort of mob rule capitalist theorists assume they do. Actually, an unplanned, unregulated economy based on a religious devotion to private property rights is much more mob rule than social democracy.
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# Sam Buchanan Says:
March 6th, 2009 at 12:55 pm
> Actually, an unplanned, unregulated economy based on a religious devotion to private property rights is much more mob rule than social democracy.
and is also hypothetical, because private property rights don’t naturally exist. They have to be created by regulation.
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Sam Buchanan,
- “Try telling those who own it that the land is empty.”
Try telling the owners of empty land that it is empty? Why?
- “Of course, in the real world people are reasonable, and don’t practice the sort of mob rule capitalist theorists assume they do.”
So legal slavery never happened? Jim Crow laws never happened? Marginal tax rates approaching 100% never happened? Outright confiscation of property never happened? The legal persecution of minorities never happened? Etc, etc, etc ad nauseum.
- “actually, an unplanned, unregulated economy based on a religious devotion to private property rights is much more mob rule than social democracy.”
How so?
How can Capitalism – a system fundamentally based on the elimination of coercion – be called “mob rule”? It is its very antithesis. That’s why collectivists (socialists/fascists/nazis/communists) hate it; it disallows their activist agendas which all rely on coercion.
Contrast Capitalism with the runaway crony democracies, increasingly dominated and controlled by powerful special interest groups, including businesses and labour cartels – all at the expense of the powerless individual. The US and the UK, for example, seem to be racing each other to become police states and to burden unborn generations with the debts of their profligacy. And NZ, with its RMA, has effectively instituted the nazi/fascist model of ostensibly leaving property in private hands, but denying the rights that go with it in order to enforce some collectivist/nationalist agenda.
Do you know who spends most money buying influence in the US? Oil companies? Defense contractors? Nope. It’s the teachers’ unions. And they’re certainly not in it for the kids, either; One of their objectives, for example, is to crush those voucher systems which allow children to escape from the appalling state schools. It seems okay for Obama and his rich friends to get their kids out of those dumps, but he’s going to deny everyone else those opportunities, because he’s been bought and paid for by the unions.
kahikatea,
- “private property rights don’t naturally exist. They have to be created by regulation.”
Rights exist whether or not they are enacted into law. They are inaliable.
Laws don’t create rights, they recognise them (or fail to recognise them, as the case may be.)
For example, people have a right to free speech, whatever the laws of the land may or may not say.
Were that not the case then the citizens of countries such as North Korea, Cuba, China, Saudi Arabia and Burma etc can have no cause for complaint when they are imprisoned, tortured or killed for expressing their opinions, since there is nothing in their laws to allow free speech.
If there are no laws against slavery, or if slavery is actually legal, does that make it okay for you to hold slaves? Most people would say no. They understand that rights precede and trump laws.
If slavery is wrong then, by the same token, the partial slavery of taxing the income of other people is also wrong.
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wat
Do you know who spends most money buying influence in the US? Oil companies? Defense contractors? Nope. It’s the teachers’ unions.
Source ?
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fastbike,
http://www.dcexaminer.com/opinion/columns/TimothyCarney/Teachers-unions-say-jump-Congress-says-how-high-40384837.html
“Beltway bandits, defense contractors, influential industries—most of them pale in their influence efforts compared to the teachers unions, according to data from the Center for Responsive Politics…The top two teachers unions—AFT and the National Education Association [NEA]—spent more combined, $5.27 million, than the top two defense contractors. The top five lobbying firms, combined, didn’t equal the AFT and the NEA in federal contributions in the 2008 cycle. Both of the teachers unions gave more than any oil company, and the NEA and AFT combined gave more than the top four oil companies combined…The NEA employs four different lobbying firms in Washington, in addition to their in-house lobbying arm, which includes at least six lobbyists…The AFT and the NEA, then, are wealthy special interest groups that, in an effort to secure more taxpayer money and preserve a near-monopoly, donate to nearly every Democratic congressman. They spend millions on lobbying and retain big-name lobbyists to push their cause. And their cause includes stripping out funding for vouchers.”
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Brilliant, you’ve discovered the US system is corrupt. Congratulations. Let’s hope it doesn’t happen here.
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Valis,
Why would you suppose that paying to influence a centralised state, dispensing enormous high-value patronage, would only be of interest to special-interest groups within the US?
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Certainly it would be of interest anywhere, but the US and Australia for that matter are known to be far more corrupt than what goes on here. New Zealand doesn’t have the same tradition of corruption as in the States – why I don’t really know – has better rules around lobbying and particularly funding, and has a much more independent public service as well. We’re not pure for sure, but we have a long way to go before sinking to the level of the US.
Re this thread, I just thought it was funny to see an argument about which lobby group was the worst, as though the problem was who managed to pay the most rather than the system itself.
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