National's Budget like watching paint dry, Labour's would have led to economic disaster

Just looking back on Thursday's budget.

It wasn't really my cup of tea because it didn't cut back on spending enough. 

Lets face it it was politically safe and boring to the max -just what Key and Co need to be elected for a further term.

What was needed though was a massive cut back in the 10s of billions of wasteful social spending over the last ten years that got us in the current mess. Working for families, free money for students and that ridiculous "Gold Card" for seniors that will cost us dearly in the future amoungst other brain dead spending. We simply cannot afford these things.

Nobody got anything in the budget except another unaffordable socialist bribe, the home insulation scheme - stop insulating yourself with my money, keep yourself bloody warm!

We didn't get back the high taxes we paid over the last ten years either. Tax cuts were cut.

A really dumb move practically because we all know tax cuts stimulate economies more than any other tool but a good move politically because it looks like Bill English "cares" about the public purse.

As bitter as a  National Party 2009 budget is to swallow, one doesn't have to broaden ones imagination too far to surmise how much worse the budget would be under a Helen Clark Labour Government.

We would have had more of the same that we had under the last 10 years - Phil Goff has confirmed that many times over the last 8 months by reiterating we should be spending money we don't have. Taxes would have gone up instead of being just cut, we would have borrowed and spent our Children and Grandchildren's economic livelihood like Kevin Rudd, Barrack Obama, Gordon Brown and a number of other brain dead socialist morons around the world have over the last 8 months and interference from our Government would be more akin to a Stalinist regime only seen in North Korea.

We must remember the gleeful way Micheal Cullen gloated to National before the 2008 election that he had spent all our money, there was nothing left in the cupboard -"eat that!" to get a grip on where we would have gone from 2008 to 2011.

The man should be shot as treasonous for doing that but imagine his tax and spend regime under an economy in recession rather than the booming one that he inherited.

Yep, the 2009 Budget was boring but it is just what we need at a time like this, the alternative Labour Budget would have given us the Icelandic economic chills and brought us to our knees in short time.

At least with National we have a chance.

c Political Animal 2009

Cullen bows out leaving a bloody mess behind

One of New Zealand's most destructive politicians in our history has his final day in Parliament today.

Michael Cullen presided over an economic boom which had its genesis in the 1980s and had not been seen for generations. He then taxed and spent the economy into such a hemorrhaging economic state it will take another generation to get back to real economic growth.

His legacy is a massive crumbling State service, bloated with civil servants with nothing constructive to do and as a result middle income families with high debt taxed to the hilt to pay for the whole thing!

A venal, nasty, arrogant incompetent evil socialist prick who never had a real job in his whole life - is there any other kind of socialist?

The post office is the perfect place for him to go.

I should have tripped him when I had the chance. 

c Political Animal 2009

Michael Cullen's legacy a sad indictment of Socialism

Michael Cullen is leaving, how sad for all of us.

Before we all get weepy beyond control lets remind ourselves how good he really was.

His Achievements:  

* Taking New Zealand to the brink of economic destruction at a time when the economy was at its best in generations.

* achieving amongst the highest taxes in the world.

*Using those taxes on handouts to those that didn't earn it in the first place.

*leaving middle income people with high debt as a result of those high taxes.

Failing to cut taxes even though faced with the biggest economic boom in generations.

*Leaving Kiwis with the aftermath, massive state debt and huge financial holes in all Government "services".

*growing Government spending by 50% in the last 5 years while the economy grew less than 26%-from about $42 billion to 62 billion!

*saddling kiwis with record numbers of useless bureaucrats.

*allowing the Auckland Airport shareholders to lose more than $1 billion in income.

*buying KiwiRail at 100% more than it was worth.

*Calling those who earn over $60,000 PA "rich pricks".

There is much more but this rich prick has to go to work.

How appropriate though that he gets a job as one of the head posties at the Post Office, where all the dead politicians go when incoming Governments don't know where else to put them.

Still, like the bulk of his life Cullen will continue to feed off the State tit because he is incapable of anything productive.

Hasn't he done well.

c Political Animal 2009

KiwiRail value derailed

I had to get this billboard photo from Whaleoil because I couldn't find it on any Labour Party affiliated website.

Perhaps they are embarrassed. 

They should be.

The accounts reveal the value of KiwiRail has been slashed $242 million, more than a third, since the Government bought the business from Australian firm Toll in July for $690 million.

The "fair value" of KiwiRail is now $448 million, a loss of about $56 for every New Zealander.

KiwiRail is a key plank in Labour's election billboards, which include Kiwibank and KiwiSaver. "Keep it Kiwi, vote Labour" the billboards say. More

Today we find out that the Crown accounts show the "value" of KiwiRail have dropped by almost a quarter of a billion dollars since Cullen bought it just a few month ago.

This brings KiwiRails value down to just $448 million. Not bad going in just two months.

Of course Treasury puts the value of KiwiRail at alot less than that. 

$125 million is their true value of Mikey's wee train set.

c Political Animal 2008

Cullen has put NZ financial sytem in grave danger

Michael Cullen's belated move last week to guarantee deposits in the wake of a major world credit meltdown is his dumbest move ever as Finance Minister in 9 years and puts our banking and financial system at massive risk.

We needed a deposit guarantee system but it needed to be properly put together, with guarantees for interbank lending, which is the real crux of the credit meltdown, and a guarantee of deposits at our stable banks, not finance companies, which have a much higher risk and offer higher interest rates than banks.

In the haphazard way in which it the deposit guarantee has been constructed, it has already distorted various financial markets and had a run on money coming from banks, managed funds, the New Zealand stockmarket and proceeds from recent house sales and going towards risky and dodgy finance companies.

And why wouldn't you put your money into finance companies?

They now have the same guarantees as the major banks but with higher returns !

Cullen has now produced a scenario that the banks, which were receiving money from finance companies because they were too risky and most of them dodgy, are now unfairly put at risk themselves as depositors money is removed from their vaults to go to higher return finance companies.

This is a nightmare unfolding and in effect puts the major banks at a huge disadvantage. They would have been more financially sound had Cullen done nothing.

Unfortunately Michael Cullen can do little to ameliorate the problem because hundreds of millions of dollars have already been transferred to finance companies and it wouldn't now be prudent to backtrack, practically and of course for himself and Labour would be politically disastrous.

What he could easily do now, since he has interfered already, is direct finance companies to limit their future interest rates and therefore stem the run on banks.

Unfortunately we have a man who is pig headed, does things politically instead of for practical reasons, is way out of his depth and experience and far too slow to react.

The man the he criticises, far from being an opportunist, is able to make the sorts of decisions that Cullen should have made; quickly, timely and with far more experience and accuracy.

As a currency trader, timing for John Key was crucial; not months, not weeks, not days, not hours, not minutes but seconds separated him from making a bad or a good decision.

And he was working in Trillions of dollars everyday, so today's economic climate is comparably like a walk in the park.

We all know how good he was at his job.

Cullen is not yesterdays man, he simply was never up to the job of Finance Minister in the first place and needs to fall on the sharp corners of his faux gold edged framed Doctorate of History degree before he ruins us financially.

c Political Animal 2008

Is that it?

So Labours response to an economy in possible meltdown?

"Guarantee" deposits.

It is voluntary for institutions and will cost banks. It is free in Australia.

And they announced it at their election kick off making it a political rather than an economic decision.

John key pleaded for a similar scheme last week, while Labour has dithered in the face of economic disaster.

The second arrow to their emergency response is to bring forward infrastructure spending. A good idea but something National will do as well. 

No mention from Michael Cullen about cutting back on wasteful Government spending, including the economy destroying global warming taxes that they have and will introduce.

Cullen is likely to step up such unproductive spending in the hope by him that it needs to go higher to "look after the vulnerable" but all that will do is put growth at risk.

Labours two moves have impact on the economy sometime in the future but there is nothing immediate from Labour to address current problems and there clearly needs to be.

It really is more of the same from the last nine years, an approach to the economy that managed New Zealand into its current recession.

It ain't enough.

c Political Animal 2008

Time to focus on Michael Cullen's economic mis-management

Michael Cullen has fucked up the economy , lets be clear about that, I have been saying it for years and we are now in a disastrous financial position thanks to his mis-management of the economy.

I cant for the life of me then understand why the media is focusing on how John Key will pay for much needed tax cuts when the answer lie in what Michael Cullen has been wasting our money on for the last 9 years, bureaucracy, free money and wastage on things like KiwiRail, Working for Families welfare and interest free loans.

Cut back these and the stimulus of tax cuts will be easy to afford.

The real questions should be asked of Cullen.

How did he manage us into the recession we are in?

Why didn't he cut back unproductive spending?

Why didn't he cut taxes years ago?

Why given a looming recession did he buy KiwiRail for 6 times more than it was worth?

Why did he hire so many bureaucrats -an increase of more than 40% over 9 years-the health portfolio has 1 bureaucrat for every hospital bed!

Why did you buying votes with billions of taxpayer dollars before the 2002, 2005 Elections

Some serious questions have to be asked of Michael Cullen. He has spent our money like a drunken sailor over the last 9 years and simply doesn't care because the spending fits Labors socialist agendas.

The blame for our current mess lies almost completely with him. Outside forces have only had a minor influence thus far but will impact at a latter date.

He has simply spent everything New Zealanders have earn't over the last 9 years and he has dropped us in it.

Yesterdays books should mean toast for Labour for the 2008 Election and the media focus should be on their reckless fiscal ways not on erroneous stories about how National will afford tax cuts.

Helen Clark is right that the 2008 Election is about the economy, about how badly Cullen has managed it.

c Political Animal 2008

VIDEO: Michael Cullen on Socialism

Michael Cullen on Socialism - part 2

A bizarre little video of Michael Cullen at a drunken Labour Party meeting in a pub somewhere.

Here he explains his reasons for being a socialist and his warped outlook on the world and how it should be.

It kind of explains his bitter stance towards successful people like John Key and his labeling of such people as "rich pricks", poking fun at them and deriding them for having a go, having aspiration and succeeding in life, instead of giving them well deserved due praise.

After having watched this I can see the reason why the working for families welfare package was rolled out-it is central, in a major way, to Labour's socialist ideals.

Of special interest is his stance on tax cuts and it flies in the face of the meagre cuts he has promised to buy votes in the 2008 election.

It is worth a look if you don't know much about this strange little man.

It should scare you.

c Political Animal 2008

Cullen pays 6 fold more than KiwiRail worth

It is no surprise that the purchase of Toll Holdings rail assets earlier this year were overpaid for but Kiwis can now officially know just how much.

In a report sneaked out by Treasury and written about at the NBR on September 16:

Documents posted on the Treasury website reveal that in late 2006 officials valued the New Zealand’s rail system at $120 million, some $570 million less than the price the government paid for the business in July this year.

The paper trail clearly shows that throughout the lengthy sale process, Toll had the upper hand in the negotiations because it knew the government was not buying for commercial reasons. Toll also knew that the crown was under time pressure because it had to continue adequate funding to secure the financial viability of the rail business.

We are supposed to trust this individual to manage the New Zealand economy over the current recession given he spends taxpayer money like a drunken socialist?

Related Reading

KiwiRail rolls out Cutting edge technology

KiwiRail's First maintrunk service begins

Commerce Commission needs to derail KiwiRail owner

KiwiRail will cost Mainfreight

c Political Animal 2008

"Little Prick" Michael Cullen misjudges economic turmoil,again

The current market turmoil and subsequent downturn in global economic conditions are great reasons why National should go ahead with their "$50 tax cut" plan.

There has been much fuss made by the uniformed and ideologically bent Michael Cullen over this issue:

He suggested the forced sale of Mr Key's former employer - Merrill Lynch - in the US showed the National Party leader was not a safe pair of hands to manage it.

"You don't want a gambler and short-term money market player who will risk billions and billions of dollars. We are seeing in the United States the consequences of that kind of mentality unfolding right now."

That is not only sneering and sticking the knife into people who may have lost money, people mikeyboy calls "rich pricks" but it is patently misleading.

During downturns such as these one of the best things a Government can do is stimulate the economy. Using tax cuts to do this is the perfect way to ease the economic pressures in the short and long-term.

Of course Cullen's antidote to the current problems will be to tax New Zealanders more.
For people out of his depth, such as him-he has a doctorate in history-raising taxes will be a way of "protecting the State" something he loves.

Bugger the proletariat though, he has a different feeling for us.

So if you are expecting this individual to manage New Zealand's way economically well over the next 3 long turbulent years just remember who led you into the current mess.

He has mismanaged the economy for the last 9 years under the best  economic conditions for generations, imagine his ideological tax and spend ways under a deep recession.

It would be an unmitigated disaster.

He has had a chance.

Vote the "little prick" out.



c Political Animal 2008

Kiwis breathe a sigh of frustration, not relief, over distant meagre tax cuts

c Tom Scott, Stuff.co.nz 2008


In a story in yesterday's NZ Herald Mr Cullen said tax cuts in October would bring "relief".

"From October 1 all New Zealanders will get a tax cut that should provide some relief from rising prices." Michael Cullen 16.7.08

Well, I don't get tax cuts from that date because I'm self employed and 10s of thousands of other Kiwis are as well.

It seems bizarre that Dr Cullen would trumpet "tax relief" when Kiwis need it now. They actually needed it years ago. Labour decided to stop taking as much tax off us in the budget this May but the 6 month wait makes Labour's decision political rather than any sort of benevolent government helping out the proletariat. On average the October cuts are equal to less than one block of cheese.

National would have brought their tax cuts in with urgency and unlike Dr Cullen's election bribe, tax cuts were something that the National Party have been pushing for years. Dr Cullen doesn't believe in tax cuts, he thinks the State should spend your money.

“We just don't believe in tax cuts - it's against our fundamental philosophy - after all we are socialists and proud of it.”— Dr Michael Cullen


We can however have a NZ$ 2 billion decision to buy 17th century technology, KiwiRail, made on the fly instantly, lose $1.5 billion of shareholder money by stopping the sale of the Auckland Airport, and increases in road user charges and an extra tax on petrol for all, both increasing cost to the average kiwi and more than wiping out any tax cut come October. But we cant have the meagre tax cut now?

In fact the amount of Government promised election spending so far announced by Labour puts the tax cuts in the shade. We will all be a least $30 pr week behind thanks to Cullen's "generosity" in the wake of an election.

Remember this when you cast your ballot this November:

My view is that tax cuts are largely offered as a political bribe, not because of beneficial economic or social effects.

— Dr Michael Cullen



Related Political Animal reading

Michael Cullen speaks with forked tongue
Cullen's history on tax cuts comes back to haunt him
Wednesday Political Soup: Edition 3 2nd story down - Let them eat cake
Labour and their last crusade



c Political Animal 2008

2008 New Zealand Budget News

Michael Cullen will be making probably his last budget and will be pulling out all the stops to retain the power he and his mate Helen crave.

Come and check out a full wrap of news, opinion and facts from the 2008 New Zealand Budget here

Wheres the Love? [Extended Political Animal Edition]

Government cost to business hasn't been ameliorated by today's quadrangle of
State interference that kicked off, appropriately, on April 1.


Just we wee addendum to the original article. In parliament today, listeners would have heard Michael Cullen et al waxing lyrically about how much the Labour Government had "given" to New Zealanders over the years and the latest raft on handouts, mentioned below were added to the long list.

Labour gave us free student loans, more holidays, 20 free hours childcare,higher wages,more holidays,corporate tax cuts, yadda, yadda.

The point is clear to me and underlined by a great speech by Act's Heather Roy who just happened to mention that Labour gave us none of those things. It was our money to begin with and how about giving some of it back so we can make our own decisions about what we want to do with our moola!


Originally published @ Share Investor Blog 1 April 2008

I cant help myself talking about it, politics is intrinsically linked to investing and business and in New Zealand our economy is hugely influenced by what the government of the day does to it more than most global economies.

The introduction and trumpeting today by our Labour government of 4 things that "they are proud of" that will "help business" has less to do with helping business but more to do with election year and keeping control over the economy and its participants.

The much ballyhooed 3% cut in corporate tax rates, taxpayer handouts to business for research and development, employer contributions to Kiwisaver and the lift of the minimum wage to 12 bucks all run against each other in their purpose and execution.

The over hyped tax cut and R & D subsidy for our corporates hides the fact that Kiwisaver, the associated paper work and the lift in wages easily dwarfs the meager 3% cut already.

Include all the other government imposed costs to business over the last 9 years, like higher ACC, energy and carbon taxes and nonsense like employer funded maternity leave(what is wrong with the family paying, a novel idea I know, but just an idea) and an extra weeks leave for workers and even the blind, deaf, dribbling and Labour voters(OK maybe that is a stretch) can see how far behind business is.

The tax cut would have to be at least down to a 25% rate to get business back to where it was in 1999, in terms of costs and return of capital.

That way, business could afford to fund R & D from cashflow instead of another army of extra State funded bureaucrat's handing out taxpayer money to those they see should get our money-I mean these people picking business winners? I doubt many of them can remember their PIN numbers let alone pick good businesses.

What is missing from today's election focused "take more it and give some back" approach to business is a bold statement to business, especially small business, the back bone of this country, that the country values your contribution and we are going to reward your entrepreneurship.

State attached funding via R & D subsidies and other quasi government welfare schemes, extra business expense and paperwork isn't a good way to show that we love business.

I fear the present administration doesn't like the independence and confidence that self employment or owning your own business brings and are doing everything they can to inextricably link business owners quest for economic freedom by weighting business and therefore the economy down with cost and bureaucracy.

A 3% company tax cut isn't going to cut it for those hard working individuals who own companies and in fact bypasses those who are sole traders entirely.

Its time to show business we love them.

Not the opposite.


Related Political Animal Reading

Labour's State Control Out of control




c Share Investor & Political Animal 2008

Dr Cullen needs to intervene in OCR

The New Zealand Government is happy to intervene where its citizens don't want them
but when it comes to the precipitous economy in relation to lowering interest rates,
Michael Cullen gets blisters on his hands from sitting on them.

Original story from Share Investor Blog

I'm not an interventionist by any stretch of the imagination but our monetary system, for better or worse, is, and so is the present regime that presides over the country's books, the New Zealand Labour party.

The interventionist approach in regard to the Reserve Bank and through the official cash rate(OCR) has led NZ INC, courtesy of drunken overspending and overtaxing by the aforementioned regime, to the highest interest rates in the "developed" world.

The Mike and Helen show has put the country in a very precarious position, given the uncertainty over the global economy and the "credit crunch"(2 days in a row, sorry) has slowed the wheels of commerce globally.

This dastardly duo seem quite pleased that an excuse like the global credit crunch has come around because they are now on a PR offensive to blame any current or future New Zealand downturn on it and not themselves, where the bony finger should be pointing.

The sensible among us know that high interest rate were here 3-4 years ago and then we though a credit crunch was a new chocolate bar bought on time payment.

Like Al Gore's science fiction movie "The Inconvenient Truth", we also know, like that movie, the M and K show lacks consistency and truth. When it comes to the economy we can all remember the Labour Party taking the accolades for the nearly 4% growth we had for a nano second, but they now blame the downturn and any possible downturns on other circumstances.

You cant have it both ways.

Now this government's profligate taxes and spending(they go hand in hand) has put its citizens in such debt that we even outrank those nasty Americans for our debt levels. This debt is primarily in real estate and servicing the high interest debt that bought it.

Higher house prices meant more borrowing on the increased equity, because taxes are so high we had to borrow to survive.

So guess what, now things are in reverse, because of that debt we are in potentially a worse condition than America.

They at least borrowed to buy other sorts of assets beside houses, while we sunk most of ours into houses and plasma TVs.

While we haven't had the extreme reckless lending like America's Sub Prime loans, we have got many thousands of kiwis who have borrowed more than they will be able to service when the shit hitith the fan.

Its hitting now.

NZ$40 billion of mortgages will be refinanced this year alone at close to 10% and others will be higher, the time for intervention is now.

The OCR should have been cut at least a year ago but now there is urgent need for it. An emergency cut to bring it into line with other nations suffering from the sub prime fallout would be a key move in the right direction.

There is no use sitting on your hands waiting "to see what happens" according to Alan Bollard, the Reserve Bank Governor. Decisive action needs to be taken because inflation is the least of his/our worries now.

Like I have said before the OCR is a poor way to maintain an economic system, it doesn't serve its purpose well, but it is all we have at present.

A progressive cut over this year, down to below 6%, starting with a .75 point basis cut will send a good message to the market and business, that lending rates will be somewhat dampened and business will be stimulated when it needs it.

Our socialist government are intervening in every other part of our lives, including the private business world but for the life of me , when we really do need intervention, Micheal Cullen just sits on his calloused hands and blames others for our countries current mis- fortunes.

Get off your arse and do something history boy.


Essential related reading from Share Investor

Alan Bollard's indecision over OCR a worry to NZ INC
Share Investor Friday Free for all: Edition 13 - first story

Global credit squeeze: There is no free lunch
Current Credit crunch a blessing in disguise
Lenders must come clean over losses to restore faith in credit markets

c Share Investor & Political Animal 2008

Time for OCR intervention by Dr Cullen

The New Zealand Government is happy to intervene where its citizens don't want them
but when it comes to the precipitous economy in relation to lowering interest rates,
Michael Cullen gets blisters on his hands from sitting on them.


I'm not an interventionist by any stretch of the imagination but our monetary system, for better or worse, is, and so is the present regime that presides over the country's books, the New Zealand Labour party.

The interventionist approach in regard to the Reserve Bank and through the official cash rate(OCR) has led NZ INC, courtesy of drunken overspending and overtaxing by the aforementioned regime, to the highest interest rates in the "developed" world.

The Mike and Helen show has put the country in a very precarious position, given the uncertainty over the global economy and the "credit crunch"(2 days in a row, sorry) has slowed the wheels of commerce globally.

This dastardly duo seem quite pleased that an excuse like the global credit crunch has come around because they are now on a PR offensive to blame any current or future New Zealand downturn on it and not themselves, where the bony finger should be pointing.

The sensible among us know that high interest rate were here 3-4 years ago and then we though a credit crunch was a new chocolate bar bought on time payment.

Like Al Gore's science fiction movie "The Inconvenient Truth", we also know, like that movie, the M and K show lacks consistency and truth. When it comes to the economy we can all remember the Labour Party taking the accolades for the nearly 4% growth we had for a nano second, but they now blame the downturn and any possible downturns on other circumstances.

You cant have it both ways.

Now this government's profligate taxes and spending(they go hand in hand) has put its citizens in such debt that we even outrank those nasty Americans for our debt levels. This debt is primarily in real estate and servicing the high interest debt that bought it.

Higher house prices meant more borrowing on the increased equity, because taxes are so high we had to borrow to survive.

So guess what, now things are in reverse, because of that debt we are in potentially a worse condition than America.

They at least borrowed to buy other sorts of assets beside houses, while we sunk most of ours into houses and plasma TVs.

While we haven't had the extreme reckless lending like America's Sub Prime loans, we have got many thousands of kiwis who have borrowed more than they will be able to service when the shit hitith the fan.

Its hitting now.

NZ$40 billion of mortgages will be refinanced this year alone at close to 10% and others will be higher, the time for intervention is now.

The OCR should have been cut at least a year ago but now there is urgent need for it. An emergency cut to bring it into line with other nations suffering from the sub prime fallout would be a key move in the right direction.

There is no use sitting on your hands waiting "to see what happens" according to Alan Bollard, the Reserve Bank Governor. Decisive action needs to be taken because inflation is the least of his/our worries now.

Like I have said before the OCR is a poor way to maintain an economic system, it doesn't serve its purpose well, but it is all we have at present.

A progressive cut over this year, down to below 6%, starting with a .75 point basis cut will send a good message to the market and business, that lending rates will be somewhat dampened and business will be stimulated when it needs it.

Our socialist government are intervening in every other part of our lives, including the private business world but for the life of me , when we really do need intervention, Micheal Cullen just sits on his calloused hands and blames others for our countries current mis- fortunes.

Get off your arse and do something history boy.


Related Share Investor reading

Alan Bollard's indecision over OCR a worry to NZ INC
Bollard sits on his hands

Global credit squeeze: There is no free lunch
Current Credit crunch a blessing in disguise
Lenders must come clean over losses to restore faith in credit markets


Related Amazon reading



Interest Rate, Term Structure, and Valuation Modeling
Buy new: $56.67 / Used from: $39.00
Usually ships in 24 hours


c Share Investor 2008

Michael Cullen speaks with forked tongue

c Emmerson 2008



Some days it is hard to take Dr Cullen seriously. Today is one of those days.

While commenting about his tax cuts this year, engineered to buy the 2008 general election he let a sly one past.

I had a loud chortle to myself when listening to a Newstalk ZB audio clip live from the exciting port metropolis of Napier, that the main reason for New Zealand's record high interest rates was the current "credit crunch" that the world was facing and we would also be facing higher food and energy prices.

It slipped his mind(who's slippery now Mike), perhaps after a chardonnay or three, that the reasons for high interest rates and other rising prices was the fault of himself only.

Let me dispel the myths Dr Cullen!

Record high government spending by Labour on wasteful social engineering schemes has pushed up our official interest rates to 8.5% up from half that before Labour began its sentence on its citizens back in 1999.

A plethora of extra taxes including : employment, ACC, fiscal drag, electricity and gas taxes has led to higher inflation and therefore increased food prices.

What is really scary though is that Cullen is set to add even more taxes onto our already burdened and beaten economy in the form of a whole host of nonsense global warming taxes.

Up to 20c a litre of petrol will be added by local and state government this year and carbon credit trading will add additional cost to everything we buy, be it a service or product. In effect it is like another GST, except we don't know how much that extra cost will be.

Allan Bollard mentioned the added inflationary costs of these GW taxes but our mainstream media seemed to have collective ignorance over these basic economics.

Cullen has strangled the economy so hard with his overburdened taxes and spending, last month taxes actually dropped by over $700 million.

Don't be fooled, Dr Cullen is a bright man, regardless of his mis management of the economy over the last 9 years.

He has a philosophically socialist agenda though, with all its attendant consequences(and expenses) and he is clearly sticking to it come hell or high water.

More than ever now we need tax cuts, they stimulate economies, especially during dark times like these.

Dr Cullen's track record is poor, his handling of the economy during economic conditions the best we have had in generations borders on the slippery. He has crowed for the last 9 years about his results, given these conditions, which he had no influence on, but now abdicates that responsibility now that the brown stuff has hit the you know what.

Hang on, if you are a socialist you can take the plaudits for something you didn't do and abdicate responsibility for your failures, all at the same time keeping a straight face.

You cant have it both ways Dr Cullen.


Related Political Animal reading

Cullen's history on tax cuts comes back to haunt him
Global Warning: Tax iceberg ahead
Carbon credit trading puts global markets at extreme risk
Global Warming: Power to the people
Wednesday Political Soup: Edition 3 2nd story down - Let them eat cake



c Political Animal 2008

Cullen's move on Auckland Airport has far reaching effects

A cynical move by Michael Cullen to gain votes in the 2008 Election by
blocking an Auckland Airport sale will have far reaching effects.

The Battle for the Airport-NZ Herald

Latest Airport News:

• Key accused of being 'slippery' over Auckland Airport
• Cullen's shock move hinders airport bid
• Canadian's push on regardless of Cullen move
  

Michael Cullen's move today to put a stop to a partial sale of Auckland International Airport(AIA) to the Canadian Pension Plan Investment Board(CPPIB) has more far reaching effects than putting the brakes on this deal.

Below is the piece of legislation that has been changed, in relation to the airport merger, and it is sufficiently vague enough to cause major uncertainty, for investors, domestic and international, and business in New Zealand.

"Whether the overseas investment will, or is likely to, assist New Zealand to maintain New Zealand control of strategically important infrastructure on sensitive land."

Who decides what is "strategically important" and on what basis do they apply the new legislation?

Is the Warehouse(WHS) a strategic asset?

Business and investors need certainty, you only have to look at current market conditions to figure that out, and the new legislation leaves everyone guessing.

This uncertainty, apart from the retrospective legislation passed today, and mooted tax changes, means that foreign investors will be thinking twice before looking at putting their capital in a country that treats foreign investors like Putin's communist Russia treated foreign oil companies over the last few years.

It also means that private property rights don't mean anything in this country anymore(just like in Putin's Russia) and with the stroke of a retrospective pen your property isn't really yours anymore.

I own Auckland Airport shares, they belong to me and nobody else and in a free country I should be able to do what the hell I want to do with them.

Contrary to Labour party spin the Airport isn't a state asset, it is privately owned, by many individual Kiwis and and some bigger institutions and the playing of the "we cant sell such a "strategic asset to a foreign buyer" card makes no sense because it is already owned by 40% of off shore investors.

It seems to me that Labour playing this card in election year will be appealing to the paranoia of those people who think the National party are going to sell "strategic assets" and Labour will try to get votes from it.

Cullen mentioned that other countries have similar laws to prevent strategic assets from "going overseas"-although you would have to have pretty big container to fit the Airport into it and ship it off- they may well do or not but their laws were in in place before any important deals were being negotiated and to change conditions of a deal as it is being done is like playing the shell game with a blindfold while on crack.

The immediate affects of Cullen's finger in your pie has been enormous. Billions of dollars have been lost from the capital value of Auckland Airport and therefore shareholder's pockets. The NZX's other companies plunged in value today because of the uncertainty that Cullen's pen stroke brought to the market.

Other companies who may be deemed "strategic" by Cullen and his communist misfits will be wringing their hands in the hope they wont be next. The listed power companies, ports and others will clearly be affected.

The interest still in the wings by Australia's Origin Energy for its sister company Contact Energy(CEN) would seriously be in doubt under the new criteria. Similarly other foreign companies will consider our country's barriers too hard to negotiate. Takeovers and mergers, an essential part of successful capitalism, will prove too cumbersome to consider.

As I have canvassed before in previous articles, Cullen's move now appears to be arrogant in the extreme. His party and lapdogs in crime, Winston "Baubles" Peter's NZ First, made their feelings clear when takeover talks were mooted with Dubai Aerospace Enterprise almost 9 months ago and they were staunchly against any sale.

To move now is unlawful(it was but they will change that law) immoral and is a clumsy attempt at gaining votes from voters who think capitalism is a dangerous thing.

The cost to CPPIB and Auckland Airport shareholders has been many millions-on top of the couple of billion in lost capital for Auckland Airport shareholders.

I have been a very impassioned advocate for not selling my shares over the last 9 months, because I could see the investment as a good long term one.

I was tempted, when news first broke of a sale all those months ago, to sell at the market price that day of around NZ$3.65 but decided not to. Now I think those people who sold were wise beyond any education one could buy.

Given the interference over the last few weeks I am now going to give two ticks for the deal, it may send a message to Labour what the real owners of this asset want to do with their property but I doubt whether Cullen will listen or care.

I know this deal isn't going to happen and have said so for many months now but the interference by politicians in private property issues has me questioning my holding in such a company mired in political dead weight and sticky fingers.

I sold my Port of Tauranga shares a few years back because I couldn't contend with local Auckland politicians and Winston Peters(again) interfering in merger proposals with Ports of Auckland. That deal was ended after months of expense for Port of Tauranga.

Business needs certainty in New Zealand, especially now as the proverbial is hitting the fan hard.

That means overseas investment is needed. Today's approach by by the extreme left wing business haters in Labour and NZ First has been another nail in the coffin for NZ INC because that much needed capital is going to dry up.

The move today is reminiscent of a much troubled National Government, led by Robert Muldoon, who in its final months, regulated and nationalised the life out of our economy and then went on to lose an election in 1984 in spectacular fashion.

Ironically it was Labour who then swept into power and with the wise direction from Roger Douglas transformed the economy into a far more sustainable one.

Sadly Douglas was stopped before he was finished, by the very same people who have foisted the current heavy burden on our economy today.

Only fools don't learn from history and surely Cullen, a Dr of History himself(not in business or economics) shouldn't be as foolish as he has been over the last few weeks.

We surely cant afford a repeat.

Related Share Investor reading

Fran O'Sullivan: Cullen's shock move hinders Airport bid
Cullen's move on AIA tax plan Anti-Business
NZ Herald: Airport Deal not so sweet after tax break blocked
NZX Press Release: AIA directors recommend shareholders sell
AIA profit stays grounded
Softening opposition to CPPIB bid for AIA
Directors of AIA bribe brokers not to sell
What is Auckland Airport worth to you?
Second bite at AIA by CPPIB might just fly
AIA new directors must focus on shareholders
Auckland Airport merger deal nosedives
The Canadians have landed
AIA incentive scheme must fly out the window
Government market manipulation over AIA/DAE deal
DAE move on AIA: Will it fly?

Disclosure: I own AIA shares

c Share Investor & Political Animal 2008

Cullen's move on Auckland Airport has far reaching effects

A cynical move by Michael Cullen to gain votes in the 2008 Election by
blocking an Auckland Airport sale will have far reaching effects.

The Battle for the Airport-NZ Herald

Latest Airport News:

• Key accused of being 'slippery' over Auckland Airport
• Cullen's shock move hinders airport bid
• Canadian's push on regardless of Cullen move
  

Michael Cullen's move today to put a stop to a partial sale of Auckland International Airport(AIA) to the Canadian Pension Plan Investment Board(CPPIB) has more far reaching effects than putting the brakes on this deal.

Below is the piece of legislation that has been changed, in relation to the airport merger, and it is sufficiently vague enough to cause major uncertainty, for investors, domestic and international, and business in New Zealand.

"Whether the overseas investment will, or is likely to, assist New Zealand to maintain New Zealand control of strategically important infrastructure on sensitive land."

Who decides what is "strategically important" and on what basis do they apply the new legislation?

Is the Warehouse(WHS) a strategic asset?

Business and investors need certainty, you only have to look at current market conditions to figure that out, and the new legislation leaves everyone guessing.

This uncertainty, apart from the retrospective legislation passed today, and mooted tax changes, means that foreign investors will be thinking twice before looking at putting their capital in a country that treats foreign investors like Putin's communist Russia treated foreign oil companies over the last few years.

It also means that private property rights don't mean anything in this country anymore(just like in Putin's Russia) and with the stroke of a retrospective pen your property isn't really yours anymore.

I own Auckland Airport shares, they belong to me and nobody else and in a free country I should be able to do what the hell I want to do with them.

Contrary to Labour party spin the Airport isn't a state asset, it is privately owned, by many individual Kiwis and and some bigger institutions and the playing of the "we cant sell such a "strategic asset to a foreign buyer" card makes no sense because it is already owned by 40% of off shore investors.

It seems to me that Labour playing this card in election year will be appealing to the paranoia of those people who think the National party are going to sell "strategic assets" and Labour will try to get votes from it.

Cullen mentioned that other countries have similar laws to prevent strategic assets from "going overseas"-although you would have to have pretty big container to fit the Airport into it and ship it off- they may well do or not but their laws were in in place before any important deals were being negotiated and to change conditions of a deal as it is being done is like playing the shell game with a blindfold while on crack.

The immediate affects of Cullen's finger in your pie has been enormous. Billions of dollars have been lost from the capital value of Auckland Airport and therefore shareholder's pockets. The NZX's other companies plunged in value today because of the uncertainty that Cullen's pen stroke brought to the market.

Other companies who may be deemed "strategic" by Cullen and his communist misfits will be wringing their hands in the hope they wont be next. The listed power companies, ports and others will clearly be affected.

The interest still in the wings by Australia's Origin Energy for its sister company Contact Energy(CEN) would seriously be in doubt under the new criteria. Similarly other foreign companies will consider our country's barriers too hard to negotiate. Takeovers and mergers, an essential part of successful capitalism, will prove too cumbersome to consider.

As I have canvassed before in previous articles, Cullen's move now appears to be arrogant in the extreme. His party and lapdogs in crime, Winston "Baubles" Peter's NZ First, made their feelings clear when takeover talks were mooted with Dubai Aerospace Enterprise almost 9 months ago and they were staunchly against any sale.

To move now is unlawful(it was but they will change that law) immoral and is a clumsy attempt at gaining votes from voters who think capitalism is a dangerous thing.

The cost to CPPIB and Auckland Airport shareholders has been many millions-on top of the couple of billion in lost capital for Auckland Airport shareholders.

I have been a very impassioned advocate for not selling my shares over the last 9 months, because I could see the investment as a good long term one.

I was tempted, when news first broke of a sale all those months ago, to sell at the market price that day of around NZ$3.65 but decided not to. Now I think those people who sold were wise beyond any education one could buy.

Given the interference over the last few weeks I am now going to give two ticks for the deal, it may send a message to Labour what the real owners of this asset want to do with their property but I doubt whether Cullen will listen or care.

I know this deal isn't going to happen and have said so for many months now but the interference by politicians in private property issues has me questioning my holding in such a company mired in political dead weight and sticky fingers.

I sold my Port of Tauranga shares a few years back because I couldn't contend with local Auckland politicians and Winston Peters(again) interfering in merger proposals with Ports of Auckland. That deal was ended after months of expense for Port of Tauranga.

Business needs certainty in New Zealand, especially now as the proverbial is hitting the fan hard.

That means overseas investment is needed. Today's approach by by the extreme left wing business haters in Labour and NZ First has been another nail in the coffin for NZ INC because that much needed capital is going to dry up.

The move today is reminiscent of a much troubled National Government, led by Robert Muldoon, who in its final months, regulated and nationalised the life out of our economy and then went on to lose an election in 1984 in spectacular fashion.

Ironically it was Labour who then swept into power and with the wise direction from Roger Douglas transformed the economy into a far more sustainable one.

Sadly Douglas was stopped before he was finished, by the very same people who have foisted the current heavy burden on our economy today.

Only fools don't learn from history and surely Cullen, a Dr of History himself(not in business or economics) shouldn't be as foolish as he has been over the last few weeks.

We surely cant afford a repeat.

Related Share Investor reading

Fran O'Sullivan: Cullen's shock move hinders Airport bid
Cullen's move on AIA tax plan Anti-Business
NZ Herald: Airport Deal not so sweet after tax break blocked
NZX Press Release: AIA directors recommend shareholders sell
AIA profit stays grounded
Softening opposition to CPPIB bid for AIA
Directors of AIA bribe brokers not to sell
What is Auckland Airport worth to you?
Second bite at AIA by CPPIB might just fly
AIA new directors must focus on shareholders
Auckland Airport merger deal nosedives
The Canadians have landed
AIA incentive scheme must fly out the window
Government market manipulation over AIA/DAE deal
DAE move on AIA: Will it fly?

Disclosure: I own AIA shares

Share Investor 2008

Labour Party tax move on Airport attack on property rights

Stand back because I'm gunna blow!!!




Michael Cullen's retrospective tax changes over the AIA sale
effectively removes shareholders property rights

Additional reading on this story - direct links to article

Stuff
NBR
Radio New Zealand
Bloomberg
Southland Times



The arrogance, the stupidity, lack of moral and legal right and communist sort of garbage Michael Cullen is up to by retrospectively changing tax law to grab even more of New Zealand citizens and Auckland International Airport(AIA) shareholders money from them is not surprising, because we saw it in 2006 when the Labour government changed law in hindsight to make the theft of taxpayer money by them legal.

What is surprising is that Cullen and his mates around the cabinet table haven figured out or don't care about( I suspect they just couldn't give a hoot) the repercussions of their move: for business as a whole in the future, individuals and specifically the 50000 odd New Zealanders with shares in the airport-especially in an election year! Its just mind boggling.

We all know Cullen and his socialist mates hate private property rights and clearly business because here he is again stomping his little legislative pen and clipboard all over these rights.

That is, people have a property right in the shares they own in the airport and they have a right to sell them to whomever they wish, under the current tax laws which exist. Retrospectively changing the tax laws just because you can isn't a sensible way to oversee business because business needs to be able to function with surety of the current laws in which they trade under. They no longer have that in this respect.

By becoming involved in a transaction between its private citizens in this way the Labour Party have effectively wasted the time of all the parties involved. CPPIB , Auckland Airport and the shareholders involved.

Millions of dollars have also been flushed down the bog, because it costs to do these large deals. In this case it has cost shareholders like me money. Lots of it.

The interfering has wiped hundreds of millions from the capital value of the airport- down 13.5% or 38c to NZ$2.45- and therefore shareholders wealth and given notice to other overseas companies thinking about buying businesses in New Zealand to think again-if the government doesn't want it sold they will simply regulate in some way to stop it. It isn't your business anymore if you don't have the ultimate say about what happens to it.

Now investors know that Cullen and his minor party supporters have been against this sale from the beginning, almost 1 year ago. Winston "baubles" Peters has spoken about this many times and so has Cullen, Both early in the sale saga.

My question to Cullen is then, if you were against this sale from the beginning then why didn't you move to stop it at its inception? He certainly knew about the "tax issues" with the airport amalgamation but chose to sit on this harebrained half arsed intention till the very last minute.

He has also been aware that the announcement made today would have been consequential to the sharemarket value of AIA and has kept it secret from the NZX, CEO Mark Weldon's office and therefore the shareholders invested in AIA, and so should have informed the market alot sooner and alot less clumsier than he has.

I wonder if Weldon will be giving the minister a "please explain" letter? Doubt it.

The Canadian Pension Plan Investment board say they will "push on" with the deal and were aware of IRD approval when making their bid. I'm sure they didn't factor in todays turbulence though.

Finally, pissing off 50000 mums and dads when you have been nuked in the polls, your leader is melting down, and in an election year just isn't very bright.


Related Share Investor reading

NZ Herald: Airport Deal not so sweet after tax break blocked
NZX Press Release: AIA directors recommend shareholders sell
AIA profit stays grounded
Softening opposition to CPPIB bid for AIA
Directors of AIA bribe brokers not to sell
What is Auckland Airport worth to you?
Second bite at AIA by CPPIB might just fly
AIA new directors must focus on shareholders
Auckland Airport merger deal nosedives
The Canadians have landed
AIA incentive scheme must fly out the window
Government market manipulation over AIA/DAE deal
DAE move on AIA: Will it fly?

Disclosure: I own AIA shares

c Share Investor & Political Animal 2008

Cullen's move on Auckland Airport Tax plan anti-business

Stand back because I'm gunna blow!!!




Michael Cullen's retrospective tax changes over the AIA sale
effectively removes shareholders property rights

Additional reading on this story - direct links to article

Stuff
NBR
Radio New Zealand
Bloomberg
Southland Times



The arrogance, the stupidity, lack of moral and legal right and communist sort of garbage Michael Cullen is up to by retrospectively changing tax law to grab even more of New Zealand citizens and Auckland International Airport(AIA) shareholders money from them is not surprising, because we saw it in 2006 when the Labour government changed law in hindsight to make the theft of taxpayer money by them legal.

What is surprising is that Cullen and his mates around the cabinet table haven figured out or don't care about( I suspect they just couldn't give a hoot) the repercussions of their move: for business as a whole in the future, individuals and specifically the 50000 odd New Zealanders with shares in the airport-especially in an election year! Its just mind boggling.

We all know Cullen and his socialist mates hate private property rights and clearly business because here he is again stomping his little legislative pen and clipboard all over these rights.

That is, people have a property right in the shares they own in the airport and they have a right to sell them to whomever they wish, under the current tax laws which exist. Retrospectively changing the tax laws just because you can isn't a sensible way to oversee business because business needs to be able to function with surety of the current laws in which they trade under. They no longer have that in this respect.

By becoming involved in a transaction between its private citizens in this way the Labour Party have effectively wasted the time of all the parties involved. CPPIB , Auckland Airport and the shareholders involved.

Millions of dollars have also been flushed down the bog, because it costs to do these large deals. In this case it has cost shareholders like me money. Lots of it.

The interfering has wiped hundreds of millions from the capital value of the airport- down 13.5% or 38c to NZ$2.45- and therefore shareholders wealth and given notice to other overseas companies thinking about buying businesses in New Zealand to think again-if the government doesn't want it sold they will simply regulate in some way to stop it. It isn't your business anymore if you don't have the ultimate say about what happens to it.

Now investors know that Cullen and his minor party supporters have been against this sale from the beginning, almost 1 year ago. Winston "baubles" Peters has spoken about this many times and so has Cullen, Both early in the sale saga.

My question to Cullen is then, if you were against this sale from the beginning then why didn't you move to stop it at its inception? He certainly knew about the "tax issues" with the airport amalgamation but chose to sit on this harebrained half arsed intention till the very last minute.

He has also been aware that the announcement made today would have been consequential to the sharemarket value of AIA and has kept it secret from the NZX, CEO Mark Weldon's office and therefore the shareholders invested in AIA, and so should have informed the market alot sooner and alot less clumsier than he has.

I wonder if Weldon will be giving the minister a "please explain" letter? Doubt it.

The Canadian Pension Plan Investment board say they will "push on" with the deal and were aware of IRD approval when making their bid. I'm sure they didn't factor in todays turbulence though.

Finally, pissing off 50000 mums and dads when you have been nuked in the polls, your leader is melting down, and in an election year just isn't very bright.


Related Share Investor reading

NZ Herald: Airport Deal not so sweet after tax break blocked
NZX Press Release: AIA directors recommend shareholders sell
AIA profit stays grounded
Softening opposition to CPPIB bid for AIA
Directors of AIA bribe brokers not to sell
What is Auckland Airport worth to you?
Second bite at AIA by CPPIB might just fly
AIA new directors must focus on shareholders
Auckland Airport merger deal nosedives
The Canadians have landed
AIA incentive scheme must fly out the window
Government market manipulation over AIA/DAE deal
DAE move on AIA: Will it fly?

Disclosure: I own AIA shares

Share Investor 2008