News here that Trevor Mallard is proffering Rongo Wetere's Wananga o Aotearoa a $20 million "short-term loan" (with more to come) and (possibly) appointing a commissioner to oversee the Wananga and (maybe) an advisory group to work alongside the putative commissioner and the existing Mallard-appointed Crown Manager is greeted as expected by Rodney Hide and others with the joy of being vindicated in their attacks on the Wananga and its management.
Well, perhaps that joy is somewhat undeserved.
In the first place, if the Wananga is so badly run, then why should more taxpayers' money be spent where it has already been so flagrantly wasted? Does anyone really expect this "short-term loan" to be repaid?
And would there really be a problem with the Wananga declaring bankruptcy and its assets then used for a decent school? After all, the assets don't go away when bankruptcy is declared, and as it is now the government has just taken control of a private school, not something a libertarian should enjoy.
And why have Bill English, Rodney Hide, Ken Shirley and Deborah Coddington been attacking the Wananga anyway? This Government is spending roughly a billion dollars a year in tertiary education, mostly in what's known as 'low-level' courses such as the degrees in air-hosting and diplomas in dog-washing and the like that have been exposed in various news stories. That billion dollars a year is being spent in a system set up by the previous National Government that 'follows the student'; in other words, if a student decides to enrol for a course, then the government will pay for it.
The other name for such a system is ... a Voucher System. Such a system is exactly what ACT party luminaries such as Rodney Hide, Ken Shirley and Deborah Coddington have been advocating for years, and what English's colleagues put in place at tertiary level. Now they've got it, they don't like what they see. Have they perhaps changed their mind? Or ist just that they don't recognise it for what it is?
Rodney Hide blames Mallard for "pouring in money without control." Does he really not realise that's what a voucher system does?
Let me remind readers of the four basic ways of spending money, with some examples to show what I mean (hat-tip here to Milton Friedman and PJ O'Rourke). See of you can work out which situation describes how Rongo Wetere's chequebook was funded:
1/. You spend your own money on yourself -
e.g, you buy your own toys, and you've probably saved for them. You look after them.
2/. You spend someone else's money on yourself -
e.g., a kid gets hold of Dad's wallet in the toy store. Lots of toys, most quickly broken or ignored.
3/. You spend your own money on someone else -
e.g., you buy a toy for a friend. It's cheap.
4/. You spend someone else's money on someone else. Neither price nor quality are important -
e.g., your parents buy a toy for your friend. Its cheap. And he doesn't want it.
Until 1984, government spending in New Zealand fell exclusively into Category Four above. Following the transformation wrought by Prebble, Douglas and Richardson, government spending was mostly still Category Four, except when it wasn't and was instead Case Two: Case Two describes the whole input-output, 'purchasing of outcomes' waffle that Douglas, Prebble and Richardson applied to government spending, and that Christine Rankin's Welfare empire, John Tamihere's Waipareira Trust and Donna Awatere's Pipi Foundation went on to spend. These last three were all buying toys for others with other people's money (and Donna as you may remember was also caught spending it on herself.)
Case Two also describes Rongo's spend-up at the Wananga. It describes the voucher system too