For eighteen months now Foodstuffs and Woolworths have been wanting to act on a very basic business decision: to buy Warehouse shares from Warehouse shareholders, who for eighteen months have mostly been indicating they're wanting to sell.
Willing buyers, willing sellers -- the very basis of the market economy we're supposed to have -- but for eighteen months the agencies of The State have been refusing to let this voluntary deal happen -- and the more The State has got in the way, the more the shares in the Warehouse have been losing value, from a high over over seven dollars at the start of 2007 to just over four dollars yesterday morning (right).
Yesterday the company last about twenty percent of its value (right) as the Court of Appeal upheld the decision of the Communist Commission to block the voluntary sale of shares by Warehouse shareholders. This is a ban on business. [News here.]
The ban was obscene enough, but more obscene still was the statement made by the egregious bully Paula bloody Rebstock, whose belligerent presence as the head of the Communist Commission has done more to kill this deal than anything else. Rebstock showed she's not just a thug, but an ignorant thug when she said after the decision: "We do see this as a victory for consumers and for competition, in what is a very important market to all New Zealanders."
The ignorance is breath-taking. A decision to block a voluntary sale is to this entity "a victory for consumers." A decision in favour of a monopolistic state agency -- her's -- is a "a victory for competition." The woman is a deluded self-important bully, which no doubt makes her the ideal choice to head a state agency whose mucky hands are thrust into every significant business deal done in this pathetic authoritarian backwater.
"In coming to its decision to decline the acquisition," said Rebstock, "the [Communist] Commission considered that The Warehouse had already brought important new dimensions to supermarket competition, and potential competition, through its innovative supercentre stores."
In other words, I'm punishing investors because of the innovative business they chose to invest in.
The ignorance, and the argument for the existence of her agency, rests on a fundamental Marxist myth: that left to itself, a free-market will result in the formation of coercive monopolies. This is an utterly flawed platonic idea of competition -- a notion of “pure and perfect competition” totally unlike anything one normally means by the term “competition -- that results in the banning of freely made business deals, and the destruction of real property.
Nothing could be further from the truth than the idea that entrepreneurs in a free market need to be overseen by ignorant bullies like Rebstock. As former Libertarianz leader Russell Watkins said when her Commission was bullying Telecom (a softening up on which Labour's Minister for Nationalisation David Cunliffe later capitalised):
The only thing that needs to be regulated is the government, the only price that needs fixing and reducing is government spending, the best savings for the consumer will come when the government abolishes outfits like the interfering Communist Commission—and many more government departments besides.
[For a bonus point, can anyone tell me which scum-sucking statist politician set up the agency Rebstock heads up? Here's a clue: he's not the free-market hero you think he was.]