Asset sales to pay down debt

Well, no, they won't despite the Governments insistence. Not a dollar from the sale of our assets will go where National has been promising it will - they simply aren't telling the truth. Tim Watkin @ Pundit explains - and it's not a difficult thing to do, why Key, English and especially Ryall, as seen on Q&A this morning, are bullshitting us (please excuse the farming language).

"At the heart of its argument is debt. As Steven Joyce said again in parliament this week, mixed ownership is "about controlling the nation's debt".
But now Ryall admits that the profits from Mighty River Power won't be used to pay down a single cent of debt. Nope, no debt will be paid off thanks to this sale (and presumably the others). The only way these sales tackle our public debt is that they save us from borrowing more money for schools, hospitals and KiwiRail."

" So the debt argument just doesn't stack up.
But it's worse than that. Not only do the sales not pay down any debt, the loss of dividends from these companies must ultimately mean more debt somewhere down the track.
Bernard Hickey pointed out to me this week that over the past ten years the companies primed for sale have delivered a return on capital of 16%. Government borrowing is currently near an all-time low, at around 3.5%. So we're sacrificing 16% to save us 3.5%? How does that make economic sense?"

The asset sales trade-off - a lose-lose.

Frank Macskasy on Pike River

Shunda Barunda laid some harsh charges here over the behaviour of National, Labour and the unions in the management of the Pike River mine. I've been on the lookout for a pithy response to what he said ever since. Frank, commenting at Pundit had what I was looking for:

* The changes to legislation in the early 1990s by a reform-obsessed National Government  seems to have created the proverbial ticking time bomb. As with the leaky/rotting homes syndrome, the de-regulation of mining and safety has resulted in inevitable disaster.

* The Pike River Mine company seems to have operated using short cuts, taking advantage of the de-regulation of the 1990s. And like other hostile environments such as the sea and outer space, mining is an unforgiving activity where  eventually good luck will run out.

* Whilst National may have facilitated the environment where all the elements came together for an eventual catastrophe - it shouldn't be forgotten that Labour had nine years to address this problem and re-instate mines inspectors. They obviously did not.

* And lastly, where was the miners' union? Why did the remaining safety inspector(s) not blow the whistle? (I'm not even going to ask about the media, which seems to have fallen asleep-at-the-wheel, only to awaken when there are suitable crime stories to report, or stranded penguins that go off the Cuteness Scale...)  And Bernie Monk stated that the mine was "obviously unsafe".

Pundit on lignite

" I don’t want to close the door on the possibility of coal reinventing itself. But we should also be alive to the risk of coal getting in first, and shutting and bolting the thing behind them, against other better options."

So says Claire Browning @ Pundit

Claire's comment is a well researched one and presents a balanced view of the activities around lignite in New Zealand and in particular, Southland.

Just as extracting oil from off-shore wells around New Zealand might prolong the comfortable lifestyles we now enjoy, they'll hamper the development of new technologies that bring greater independence for us and would reduce our contribution to global warming.
Claire's assessment of the role lignite could play in delaying or extinguishing superior developments is a critical point, I believe.