sagenz

Welfare, Work and Kids

Tax will be the real point of difference between National and Labour. I am hopeful that a major boost for low income earners in terms of reducing tax paid rather than benefits gained would be the answer. There is such a high abatement rate on child support and the like that there is very little incentive to earn more. 67% marginal rates are ridiculous.

The difference in philosophy is to increase the dependence on state benefits for low earners versus reducing everybody's need to contribute to the dead weight of the government. What is the point of taking tax off somebody earning $20,000 per year when you will just pay it back to them in benefits. Design an easily administered tax scheme and reduce all the benefit bureaucracy.

Greyshade has a very interesting proposal with the UMR. The Grey Shade: Welfare, Work and Kids.Basically a threshold of around $20,000 before you start earning tax and then a rate of between 30-39% depending on how much fiscal impact and how much you allow for super. Because people now pay 20% almost from the first dollar most people gain. Especially those people who are working on minimum wage as opposed to those getting the same from benefits. Under some scenarios a family with 2 parents, 2 children earning $40,000 could be over $10,000 better off.

A single person relying 100% on state benefits would actually lose money. In this low unemployment environment there is no reason why somebody should not be able to get at least a part time minimum wage job and contribute at least $10,000 to their welfare. That is only 20 hours per week on the minimum wage.

Sending all the right signals to my mind.

Super is settled for now.

The Brash announcement has been much trailed, supposedly by disaffected members of the caucus. Not that it makes much difference. It was always the most sensible thing for National to do politically when there is such a dearth of savings and productive National wealth. Dispelling the doubt will bring some people back into the fold.The New Zealand Herald.

To its credit, the National caucus has spared the country continued uncertainty. In openly reversing its opposition to the "Cullen fund", as it called it, the party has given the country reasonable certainty that at least a partial solution to the looming problem of paying for the baby boom's retirement might outlast the life of this Government.

National need more visibility

The latest herald poll is out. Not good news for NationalArmstrong has a reasonable analysis in the Herald with his normal helengrad inspired cheap shots at Dr Brash. .

The frequent lag between the cut-and-thrust of daily politics and consequent shifts in public opinion suggests the slide in National’s support down to an election-crippling 30 per cent is more a reflection of where the party was a month ago - largely invisible with its leader drowning in ridicule.

National has since revised its tactics to get back into the headlines by raising Don Brash’s profile and staking out some key positions on core policy before Christmas to try to get people talking about National over the summer holidays.

Expect the Tax issue to be a big point of difference. Super has been removed as a point of difference. National have gone along the path I have been suggesting for a long time. Support the Cullen fund. It brings back an awful lot of stability and there is finally the chance to bring the aged back into the fold.

I think the election will be called for 6 weeks after the budget. A really big spend up on the lower middle income earners and then take it to the people for their support. Despite what helengrad says publicly, who in their right mind would not want to govern alone.

Personally I think these polls will represent the low point of National support. But there is a long way to go to get rid of these socialists.

dpf does not like death threats either

I join with dpf in condemning the death threat against Tariana Turia . We live in a democracy and attempting to rule by fear and intimidation is unacceptable.

Apparently though death threats against politicians on the right are acceptable to those on the left. Just Left: Assents to death threats.  From comments on his site.

.. if i hear brash talk about inflation i bloody throw more than mud at him!... if that man mentions the word inflation... he's a dead man! Posted by: Tristan | November 11, 2004 02:27 PM

Tristan! Temper!! I assume you are not serious, otherwise I might have to delete this...
Posted by: Jordan | November 11, 2004 02:39 PM

So if you are on the left making death threats against the leader of the opposition that is just a little bit of harmless fun.

But then if you are on the left using violence to suppress dissent at your party conference is par for the course too.  The Independent: This Week.

The Prime Minister had hardly begun her keynote address when the young man in the circle rose to his feet and started shouting. ...

...Who would rid the Prime Minister of this meddlesome interjector? The answer was not long in coming. But, had I not been looking directly at the young man when it happened, I would have missed the whole incident. A burly fellow from two or three rows down leapt to his feet, pounded up the aisle and, with a lightning fast jab to the solar plexus, doubled the protester over like a jack-knife. Winded by the blow and unwilling to risk another, the young man allowed himself to be escorted from the building.

Yanukovich may be backing down.

There is a possibility that Ukraine will end peacefully. If Yanukovich is steadily backing away from the idea of forcing the country to accept his election result it seems the tide is turning towards a rerun of the election. With a much more closely monitored vote there would be a strong likelihood of the result being accepted peacefully by both sides. Yanukovich is to be praised for starting to accept reality. There is hope for Ukraine! Guardian Unlimited | Special reports | Ukraine court attempts to end poll crisis.

Viktor Yanukovich, Ukraine's Moscow-backed presidential candidate, today said he would support a rerun of the disputed presidential election if allegations of fraud were proven. Attending a meeting with the country's president, Leonid Kuchma, and top officials from his powerbase, Mr Yanukovich said that "if there is evidence of falsification, I will agree with the decision [to call a new vote]". He also said he would urge voters in Donetsk and Luhansk - two industrial regions in eastern Ukraine in which he won strong backing, and where separatist sentiments have been expressed in recent days - to participate. However, he added that he had not seen any evidence of fraud, and suggested that a rerun of the election would be against the law.

The Australian: WMDs camouflage real reasons behind Iraq invasion [November 26, 2004]

From Powerline. read it especially if you are on the left. Then tell me based on strategic reality why the assessment is wrong. The Clinton years taught the Jihadists that America was weak. GW has taught them something else.The Australian: WMDs camouflage real reasons behind Iraq invasion [November 26, 2004].

WHY are we in Iraq? It is not, as some ranters claim, because George Bush is stupid and bloodthirsty and John Howard a spineless crawler. Nor is it because the US has regressed to Wilsonian imperialism.

For those seriously interested in the question I recommend a seriously interesting new book, America's Secret War by George Friedman. Friedman is founder of Stratfor, a private, subscription-financed global intelligence service, which I find consistently well-informed. Friedman writes of the struggle in Iraq in relentlessly Realpolitik terms.
Although the US believed Saddam Hussein possessed weapons of mass destruction, the WMDs were ultimately "a cover for a much deeper game". The big game began with the Soviet Union's invasion of Afghanistan and the US enlisting the assistance of Saudi Arabia in backing the Afghan resistance. The Saudis provided financing and guerilla fighters. They influenced other Islamic countries to send guerillas.

Hitchens worth a read on POwell

Hitchens on Powell. via ALD Foreign Policy: Powell Valediction.

As I was completing this essay, I experienced one of those random moments that make my supposed profession worthwhile. I had been invited for a Foggy Bottom chat with Amb. Richard Boucher, the State Department’s chief spokesman. He took me deftly over and around the various hurdles involved in any Colin Powell retrospect, and demonstrated the diplomatic adroitness that has endeared him to so many correspondents, and seemed almost to smooth away much of the jaggedness. And then we got to Darfur. Boucher began a practiced response, speaking about “process” and bargaining and about pipelines of food and medicine and all of that, especially stressing the horrible fate of those herders and villagers who had been “caught in the middle.” I like to think that he saw the question forming on my lips, but, before I could get any further, he suddenly underwent a complete change of expression. “Actually,” he said, as if half-talking to himself, “they aren’t ‘caught in the middle.’ There is no middle. No middle to be caught in. The word ‘middle’ doesn’t apply.” After a short pause I asked if that had been, or could now be, for the record. He said “yeah.”

I still have not figured out if the lefties would prefer America did or did not go in. Personally I think the reality of a few thousand well trained (ie Brit or US) troops would be enough to sort it.

Garton ash on transatlantic attitudes

via ALD, great as always.  Boston.com - Tim Garton Ash Transatlantic divides.

GARTON ASH: Perhaps many Americans are less inclined than Europeans to think that it matters so much. You know, I can have a crisis with my cleaning lady, but I don't think that matters as much as the crisis with my wife. So is Europe the wife or the cleaning lady? IDEAS: There's another analogy -- Europe as the jilted lover. GARTON ASH: Yes. America spends its time talking about America. Europe spends its time talking about -- America. IDEAS: It's not good, they should really get over us.

Are they worried about anti Clark riots?

The New Zealand Herald - Laos capital in security lock down as Clark set to arrive.

More than 5000 army, police and security forces are patrolling the streets of Vientiane as roadblocks outside the city prevent provincial Laotians from coming into the capital.

The blogosphere on Super

Doing the rounds and clearly everyone has a comment on the revised National policy on super as reported in the Herald - National decides to back Cullen fund.

National has changed its mind about opposing the flourishing New Zealand Superannuation Fund. The major policy u-turn was decided at the party’s caucus meeting on Tuesday and will be announced in a speech on retirement issues to be given by leader Don Brash on Monday night in Auckland. The Herald understands the change of heart came because National had recognised it could not keep using the fund as a political football and it was keen to get superannuation off the political agenda.

Kiwi Pundit is not keen, thinking the money would be better off in individuals hands.

Just Left: National Backs Cullen Fund obviously loves the idea that National have backed a Labour policy.

David Farrar says he would have voted against it but then goes on to demonstrate one major flaw of state control. The idea that a politician, no matter his background, could pick winners. Currency is a random walk. Betting on currency is high risk and anybody who thinks they can accurately predict it consistently is a fool. Even someone with the intellect of Greenspan professes to be ignorant of what direction currency will move. Much as i have a high respect for John Key and his success it would be quite wrong to allow a politican to make investment decisions. whilst the first well chosen might do it right, the second and third would use different value judgements - such as closing the gaps....

One bright side is that when National is in Government, John Key will be Minister of Finance. John used to be head of global currency for Merrill Lynch and was reputed to be amongst the best in the world at making money from investments. So when John is Minister of Finance, he should sack the Board of the Super Fund, and just invest it all himself as he sees fit. I reckon he'd have a good chance of doubling it within six years :-)

I think National has made the right decision and I really hope that Dr Brash does two things on Monday:
Firstly National will instruct the Guardians to change their weighting with a very strong New Zealand bias.  Personally I would have no problem with a 100% NZ commitment.  The idea that a risk based global weighting according to GDP is the only appopriate one is to completely ignore that domestic invesntemnt is superior and self fulfilling.  As far as the New Zealand economy is concerned an investment earning 5% in New Zealand is better than an investment earning 5% from overseas.  There is a domestic premium due to the muliplication impact of an investment $. The investment will generate wages which will be spent on other products that have been produced by other workers. The money circulates in the economy. It is part of the reason for Irish success. They kept getting 4% of GDP from the EU free each year.

In relative terms National/New Zealand will generate more returns form the Cullen fund by investing in New Zealand. The idea that there is not a useful home is flawed. There is a low % of GDP to market cap in New Zealand by international standards. Improving corporate governance and increasing funds available to NZ companies have a long way to go before breaching law of diminishing marginal returns. that is a canard

The Second thing National should do is to announce that they will hold the Cullen fund in individuals names. An annual statement to every citizen together with an IRD statement would indicate to people how much had been accrued on their behalf and how much they could expect as an annuity at retirement from the scheme. That would have the dual benefits of ensuring that future politicians cannot underfund the scheme and that people realise just how much they need to save for their own retirement.