Some thoughtful bloke is asking us to think of Muldoon as being a wiser man than many would give him credit for.
What do you think?
Darkhorse writes:
Interestingly enough it is the compulsory super schemes that are at the root of all of this – they take money from Joe Average and give it to a bunch of people who have to make a substantial return on it – this has generated vast capital flows that live in the speculative realm and fuel the Ponzi scheme. I read a commentator in the US recently who has finally twigged that when the Boomers cash up their savings there will be a huge capital draw down and a resultant loss of value as the number of buyers in the capital markets of the future will be far fewer than the number of sellers – and also they will be much poorer thanks to the boomer generation filling the world full of debt that our kids will have to pay back (if the system doesn’t collapse first).
Interestingly enough it is the compulsory super schemes that are at the root of all of this – they take money from Joe Average and give it to a bunch of people who have to make a substantial return on it – this has generated vast capital flows that live in the speculative realm and fuel the Ponzi scheme. I read a commentator in the US recently who has finally twigged that when the Boomers cash up their savings there will be a huge capital draw down and a resultant loss of value as the number of buyers in the capital markets of the future will be far fewer than the number of sellers – and also they will be much poorer thanks to the boomer generation filling the world full of debt that our kids will have to pay back (if the system doesn’t collapse first).
It doesn’t matter whether we fund our superannuation from taxes or capital returns in the end the same bunch (our kids) have to pay the cost either through increased taxes or increased prices. Taxes are likely to be both safer and more efficient. We should instead have been investing in infrastructure that would grow our economy but we spent the past three decades borrowing agianst it instead and spending up large.
Helen C and Michael Cullen actually did more to get NZer’s into debt by allowing
unfettered inflation of the property market etc than Muldoon did. At least Muldoon left us with a whole lot of useful infrastructure. Muldoon was the last Prime Minister to leave a legacy we would actually miss if it was to disappear. Imagine NZ without the Waitaki Power Scheme and without Manapouri and the Clyde Dam and the many other energy infrastructure assets built during that time. Muldoon did some awful things and some really stupid stuff too and he surrounded himself with dimwits and worse but he was the last prime minister we had who actually did anything useful as leader of the country. He just wasn’t good at organising it or selling it to the people of NZ.
We canned him for the failures in his process but in doing so overlooked the logicin his purpose. We have had as a result nearly thirty years of government that is afraid of governing and who have left it to the “markets” to decide – and that is as responsible as a ships captain letting the wheel go and blowing before the wind – with the same end result – we end up on the rocks.
Muldoon actually foresaw what is now occurring – he was just thirty years early – and was primarily spiked by the Americans de-stabilsing the oil market by fostering an over supply that produced a twenty year glut of cheap energy. If oil had stayed at around $30 per barrel in 1980 dollars (which is where it should have been) all of those investments he made would have seemed very far sighted. They will be yet.
Darkhorse
15 comments:
The real question here is what do you think Robert!
I agree with a lot of it Shunda, despite my ingrained loathing for the manner in which Muldoon bullied his way through his time as Prime Minister.
If you are going to invest, do so in something real and something local that will ensure resilience for those who paid for it.
What NZ should be doing is investing in sustainable everything right now, agriculture, forestry, engineering, you name it.
NZ should (and absolutely could be) the country that the rest of the world comes to for advice on all things sustainable.
We have wasted a huge opportunity over the past 12 years, can we get another? I hope so, but now there is a looming economic crisis to deal with (and no one to deal with it).
Hmm Robert .. Reading this brought back memories to me of Social credit meeting conferences etc the speakers would echo a lot of your sentiments. They didnt like Muldoon but in comparison to the leaders like Key English and their direction of a economic world we live in now. Most of them if they could speak, would agree with SOME of Muldoon's sentiments and ideas. ... BUT as General MacArthur said about our heroes of our past ... they just fade away.
Many I saw, gave their all risked their normal jobs etc etc as they fell out with those around them by their revolution ideas which were upsetting the lethargic status quo.
But like all crusaders who want to change our society you soon discover its the price you pay....
I guess they did in some ways hep to change such as they were the inspiration to start the demand to make NZ nuclear free later to change our election system, especially after 1981 election. They were totally opposed to our now debt ridden society, but alas our then leaders as you correctly pointed out wanted to jump on the global trend of living on credit cards....... Now the social credit visionaries have died or faded away.... and we in this country as they predicted are in the economic proverbial about to sale our most strategic assets to our overseas masters. that our hard working descendants worked hard to build up and bequeath to their future generations.
Some time ago I met a person from the South Island who told me of the plan to secure our electrical generation for our future needs and to plan it to keep the price structure at an affordable level.
He told me of the plan being in 3 basic stages - one year for immediate situations; 5 year for short term situations, and 20 year for the long term.
Each plan would be regularly reviewed and updated as information of changing needs became apparent.
The Clyde Dam project only just made it according to this person and Muldoon was nearly responsible for derailing it.
From then on the four main planners were basically told to get another job! Their long term plans were thrown out - "Rob" and his cohorts had the situation under control_"THINK BIG".
Hindsight is a wonderful tool in decision making, but with subsequent pressure groups and single minded lobbying pressure (not saying who,Rg?) we are now short of generation ability and will face severe energy shortages and/or huge price hikes.
I suspect it was farmers Fred :-)
The Think Big era occurred before I had any interest in the Big Picture, so I'm relying on Darkhorse's advanced age to drive this discussion :-)
Your comment around Muldoon's 'near derailment' is interesting.
Fred we now know that Clyde can never be used to its full potential. It was built on surrounding schist rock formation highly movable, its why they put in measures to TRY and prevent slips. They know now if the Clyde Dam ever did get filed to its capacity there would be to much pressure put on the near bye landscape which the dam is built on and most likely towns like Clyde and Alex would then over night become history.
It is good to see that Rob is taking heed of his elders. Having worked on the clyde dam as a younger person - the landslides were largely a big consultancy rort that is what happens when you pay your advisers 10% commission on all work done - but also by that time Dear Old Rob (the Muldoon one not the Guyton one) had blown it and was struggling with the finances - that was the main reason why the Clyde Dam nearly got canned. The project also suffered from a public service function (The Ministry of Works) that was on a building binge = sort of we had the capacity to build dams and we had to keep doing it. But there was a strong ethic to develop as much renewable energy as possible and we had world leading skills in doing it. Roger D trashed that. Instead of fixing the discipline and strategy issues within the public service he destroyed the whole edifice.
And remember Rob had lots of cars running on nice clean domestic compressed gas (I had one) instead of expensive imported oil. Now we burn this wonderful cheap vehicle fuel for cents a litre equivalent in power stations for 30% nett energy yield and import expensive oil to run our cars and then plan to turn coal into oil why not just burn the coal in a thermal power station and put the gas in cars. You would find that the nett carbon effect is close to neutral plus we would save a whole lot of foreign exchange.
Those coal-powered thermal power stations carbon-neutral are they Darkhorse, or are you planning to have the greenhouse gases piped into the Deep South Basin along with Solid Energy's lignite to anything over-flow?
You'll still have to mine the stuff, with all the gas production that goes with that. Not sure I follow your 'nett carbon effect' claim but I'm sure that if you've got time, you'll make it clear for me.
Sorry I meant carbon neutral in terms of the current situation ie. no more carbon than what we are doing now but better for the economy.
My carbon fetish is not that extreme.
Indeed the one (one of the) defects in the energy strategy is that it does not take into effect the benefit of domestic energy production over imported energy consumption - the latter has a negative effect on our economy - we have to export stuff so we can afford to import it while the other has a nett benefit to the economy we produce it and that creates wealth and employment.
It's a big ask but can you (roughly) quantify 'wealth' and 'employment' (taking into account the losses from not importing/exporting)?
not really - just a generalisation that if we produce something it creates employment and the more self sufficient we are the less we need to earn in the global free for all.
I could write a long one on the relative merits of domestic production over imports. Maybe this weekend
Dark horse ..you may have been right about money squandered re Clyde Dam development, sadly when strict accountability/auditing controls doesn't happen as a matter of fact this can be a reality for both private and government developments.
BUT I assure the problems with the geology of Clyde Dam and its surrounding land of highly unstable Schist Rock formation is NO FALICY...I was told that by a very recognised eminent Geologist who has years of experience with rock formation...he made it clear he has concerns re Clyde and this is why NO WAY should the proposed dams be allowed to be built by Contact along the rest of the Clutha river.
NZ has ample enough of wind supply especially off shore in capturing the trade winds which constantly flow around NZ. In harnessing this asset with wind farms off shore, we would also enjoy all the electricity we could possibly want. There would even bee enough to use the sea water to make liquid hydrogen energy to power our vehicles.
The only reason power companies like building or owning power water dams is they can CONTROLL the storage of water and thus controll the water flow leaving the dam and thus CONTROLL the supply of power generated. This means they can CONTROLL the PRICE we consumers are forced to pay.
A post on localization DH?
Excellent choice of topic. That's the sort of thing the Green Party would thrill to.
You have got to be nuts. Muldoon destroyed New Zealand and left it bankrupt. His think big rorts that never met any practical or fiscal returns were only the tip of the iceberg.
Scrapping Labours super saving scheme in favour of National Super destroyed our future and made superannuation a political football for a generation.
As for oil he refused the opportuntiy of exporting our high grade Maui product and instead decided to waste it in think big projects. If he had done as he was advised and sold it offshore and imported the motor spirit we require the country would have been far better off. Buring our Maui product in useless CNG (Car No Go) form was bad for the economy and bad for the vehicle.
It was Muldoon that caused the pain that Roger Douglas had the courage to fix.
Paranormal
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