Monday, 12 October 2009

Beer news: Quality will out

New economic realities and improving beer quality have between them signalled a change a in beer consumption that’s worth noting:

  1. DB head managing director Brian Blake estimated overall beer consumption declined 4-5% in the year to September, compared with the previous year.
    "It's been a huge category shift and I've never seen that sort of momentum before in the market," Blake said
  2. On the other hand, the Real Beer Blog reports the Brewers Guild of New Zealand has done a craft beer survey showing that for the first six months of the year craft beer bottled sales  increase 10%.

Sure, the craft beer market represents only around two percent or so of the total beer market, so that ten percent growth is from a small base, but d’you think there’s a message there for the Brian Blakes of the world?

(Large) quote of the day: On the causes of the financial crisis and the dangers of increased regulation

Hat tip to Thrutch for spotting this article the Financial Post on the causes of the financial crisis and the dangers of increased regulation – and “how regulation forces homogeneity and therefore susceptibility to the same risks”:

    “IT IS A FUNDAMENTAL misunderstanding that the market is rational and at some sort of equilibrium, where all information and wisdom are incorporated in decisions. Neoclassical economic models filled with unrealistic assumptions about humans and the economy should always have warning stickers attached to them. The market is nothing other than all the millions of decisions that we all take as we produce, act and invest -- and the tiniest bit of introspection is enough to realize that we do not behave like the textbook models. Since finding lots of information before acting takes time and costs money, we often go with our gut, following rules of thumb and copying what others have already done. That is why the market has a herd instinct. When others seem to be successful at something and get rich on it, you follow suit. After a while, the hollowness of the enthusiasm becomes apparent, and then it often changes into overblown fear that soon ushers in recession.
    “A key lesson to be drawn from such events, however, is that borrowers, lenders, bankers and brokers are not the only ones to be affected. Politicians, bureaucrats and central bankers are at least as likely to succumb to the herd instinct -- and they have special power. If you act in a different way from what they have approved, they may take your money or even send you off to jail. This gives them the ability to head the march of the lemmings and set its pace.”


“Key tackles ‘G’ “

After announcing his new plan to increase gang’s profits and make things harder for people who have colds, John Boy has now announced a War on Another Letter of the Alphabet.  Lindsay Perigo has the whole speech:

“Thank you for being here.
    “Let me acknowledge my Ministerial colleagues.  Let me also acknowledge our serving police officers, customs officers, treatment providers, community workers, volunteers, that ghastly attention-whore, grandstander and failed father Paul Holmes, and all of you who pretend to care deeply about New Zealand.
    “It is my privilege to regularly meet with groups like this one to celebrate some of the success stories of our country.
    “Today my speech has a different purpose.  I want to talk about a problem that is wrecking lives, wrecking families and fuelling crime.
    “I’m here to speak about “G”. . . “

Read on here.

Local historian getting international praise

51WgBt4JbEL._SL500_AA240_ Local historian James Belich earns plaudits from Tyler Cowen, who calls Belich’s new book Replenishing the Earth: The Settler Revolution and the Rise of the Anglo-World, 1783-1939 “one of the very best non-fiction books of the year.”

And that in a year when Thomas Wood’s Meltdown successfully explains the single most important event of the year: the meltdown of the world’s economies.

So that’s high praise indeed.

In a world of navel-gazing about minutiae, Belich seeks to explain “the explosive historical process that now sees English as one of the most widely spoken languages in the world.”  Not a simple task. Canadian historian Andrew Smith says,

    “Rather than writing to condemn or celebrate Anglo-Saxon expansion, [Belich] simply wants to explain why it took place. In particular, Belich seeks to explain why it was English-speaking people and not, say the French or the Spanish or the Chinese, who were able to colonize North America and Australasia and thus become the dominant culture on the planet.”

Looks like you should file it along with Paul Moon’s work as books by local historians that are worth checking out.

“What happened to global warming?”

“What happened to global warming?” asks … guess who … the BBC.

 What happened to global warming?.
    “This headline may come as a bit of a surprise [says the BBC’s climate correspondent Paul Hudson], so too might that fact that the warmest year recorded globally was not in 2008 or 2007, but in 1998.
    “But it is true. For the last 11 years we have not observed any increase in global temperatures.
    “And our climate models did not forecast it, even though man-made carbon dioxide, the gas thought to be responsible for warming our planet, has continued to rise.

Bet you never thought you’d hear any of those those words from the Bolshevik Broadcasting Corporation. [Hat tip Climate Debate Daily]  Is this the start of a media tipping point?

Your wallet is about to be picked

This current National-led Government doesn’t even have the cojones of the last. Faced with what Nick Smith says is an unaffordable $9 billion hike  in ACC liabilities, what’s being proposed is not privatisation – these timid puppies would sooner neuter themselves than show balls like that – it’s not putting an end to or even limiting the nonsensical “no-fault” scheme on which ACC is based – too big a football, that one, for these bozos to kick -- and it’s not even as simple as what the last National-led Government did: to free up competition in the accident insurance market, a move that in the all-too-brief time it lasted saved businesses hundreds of thousands of dollars.

So if Rod Oram’s right  (which would be a first) that Nick Smith is simply lying about the numbers here, then the whispers that ACC levies, petrol prices & car rego prices are going to be hiked to the moon to cover them can be seen as just a move by the Blue Team to raise taxes by stealth.

Remember taxes?  Those things they once promised to cut?  They never meant it, did they – just as they’re not being up front here.

Either ACC is stuffed, as Nick Smith says, in which case the whole system needs to be seriously re-jigged.  Or it’s simply a ruse, as Rod Oram says, to allow these pricks to put their hand even deeper into your pocket. 

Which means they either lack courage, or they’re short on honesty.

And which ever it is, they’re now going to pick your pocket: and it’s this lying cheat that’s going to do it for them: 

Think about him every time you fill up your car.

Extraordinary! [update 7]


Obama’s Nobel Peace Prize was awarded, says the citation, for “his extraordinary efforts to strengthen international diplomacy and cooperation between peoples."

Well they certainly got one thing right.  Well, one word. The decision of the judging committee is sure as hell extraordinary.

A prize for the vague intention to “do something,” rather than for anything actually done.  That’s extraordinary.   A prize  for lots of jaw jaw, and nothing at all to end war war.  That’s extraordinary.  It recalled the moment during Obama’s presidential campaign when he declared his primary victory as “the moment the waters stopped rising, and the planet started to heal.”  That was extraordinary too.

So is this.

I was making the case yesterday that this decision seriously devalues the Nobel Peace Prize when a friend reminded me of three things.  Yasser Arafat. Al Gore.  Jimmy Carter. All previous recipients of the award

Clearly this is a prize that’s already being devalued as fast as the US dollar.  To quote Alfred Nobel, whose historic bequest still funds the prize,

nobel And as John Cox, artist, reflects, “Congratulations, President Obama. You proved his point.”

UPDATE 1:  Not that the nomination for the prize was issued just two weeks into the ObaMessiah’s term, confirming it as a triumph of Hope over Credibility – or as Tim Selwyn suggests, it’s just “it's a snub to George W Bush and an encouragement to his successor not to be like George W Bush.”

Alas, poor Alfred.  A prize given in such genuine hope and expectation, to be degraded by politics so sordid.

UPDATE 2: So what other prizes can we nominate The ObaMessiah for, prizes for which he is equally deserving? Here’s one: The Heisman Trophy for US College football players: type his name in and click ‘Vote Here.’  Hasn’t he done just as much to win that prize as this one?

What other prize nominations can you suggest?

How about the Kiwibank New Zealander of the Year?

Any other suggestions?

UPDATE 3: Even the ostensible reason for the award is nonsense, says Time magazine, who not so long ago had the Messiah himself on their cover.  If the award for peace should go anywhere, says Time columnist David Von Drehle, it’s to nuclear weapons themselves:

    “President Barack Obama's Nobel peace surprise was given "primarily for his work on and commitment to nuclear disarmament," according to Agot Valle, a Norwegian politician who served on the award committee. ...
    “As long as a nukeless world remains wishful thinking and pastoral rhetoric, we'll be all right. But if the Nobel committee truly cares about peace, they will think a little harder about actually trying to make it a reality. Open a history book and you'll see what the modern world looks like without nuclear weapons. It is horrible beyond description. ...
    “The truth is that industrial killing was practiced by many nations in the old world without nuclear weapons. Soldiers were gassed and machine-gunned by the hundreds of thousands in the trenches of World War I, when Hitler was just another corporal in the Kaiser's army. By World War II, countries on both sides of the war used airplanes and artillery to rain death on battlefields as well as cities, until the number killed around the world was so huge the best estimates of the total number lost diverge by some 16 million souls. The dead numbered 62 million, or 78 million - somewhere in there.
    “So, when last we saw a world without nuclear weapons, human beings were killing each other with such feverish efficiency that they couldn't keep track of the victims to the nearest 15 million…”

Think about it.

UPDATE 4: The Nobel Peace Prize is not like the Nobel Prize for science.  The proof is not just Yasser Arafat, Al Gore,  Jimmy Carter.  It’s also all those other prize-winners – people like “rough rider” Theodore Roosevelt (the man who helped induce Spain into war in Cuba) and Cordell Hull (who forty years later helped shepherd Japan into war in the Pacific). Like Woodrow Wilson (who took America into WWI saying “America is in need of a serious moral adventure”), and German politician Gustav Stresemann who won in 1926 (Stressemann was a fanatical supporter of the Kaiser and of unrestricted U-boat warfare against civilians in WWI—and who campaigned for a return of Germany to glory against the Versailles Treaty in the 1920s). [Hat tip John Lewis]

Some great heroes for peace there, for sure.  But at least they’d done something.  Giving Obama the prize for peace just for talking about it in his election campaign would be like giving it to Neville Chamberlain, and to Hitler, for talking about it in Munich.

UPDATE 5: Enlightening, isn’t it, when the recipient himself feels the need to perform damage control over the award.

UPDATE 6: Liberty Scott notes that Zimbabwe’s Morgan Tsvangirai, “who had been mooted for the prize, has been imprisoned, tortured, beaten up repeatedly, lost his wife in an accident, and STILL decided for peace in Zimbabwe, to form a joint government with the murdering gangsters of Zanu-PF.

    “Apparently that wasn't good enough. Not good enough for an African man in Africa at the front line of essentially civil war and insurrection, in a truly bankrupt economy, to risk himself so much to bring peace and justice to Zimbabwe. He may have been able to do much for Zimbabwe with the US$1 million prize.
    “Instead, a group of Norwegians worshipped words not deeds.”

UPDATE 7: Robert Tracinski calls it The Nobel Prize for Moral Posturing:

    “. . .  This is an attempt by the Nobel committee to play on Obama's vanity in order to influence his decisions on Iran and Afghanistan. The message is: how could you possibly let Israel attack Iran's nuclear facilities, or how could you send an additional 40,000 troops to "escalate" the war in Afghanistan—after we've just given you the Nobel Peace Prize?
    “In appealing to Obama's moral vanity, they know their man well—and it will probably work.
    “In this respect, Obama is the perfect successor to the last American president to win the Nobel: Jimmy Carter. Consider the legacy of Carter's term in office.
    “Carter withdrew American support for the shah in Iran, then failed to mount any effectual response to the seizure of the US embassy and its staff—all of which allowed the Ayatollah Khomeini to establish a brutal Islamist regime which has been the world's leading state sponsor of terrorism, a supporter of Palestinian terrorism, civil war in Lebanon, and insurgencies in Iraq and Afghanistan, and a regime that has repeatedly murdered and tortured its own citizens.
    “By allowing a Communist takeover in Nicaragua, Carter encouraged a legacy of socialist strongmen that is still riling Latin America to this day.
    “Carter's weakness in Latin America and Iran also emboldened the Soviets to invade Afghanistan, inaugurating three decades of bloody civil war and providing the proving ground for the Taliban and al-Qaeda.
    “So Carter's legacy is three decades of chaos and killing—and the growth of three of today's biggest threats to world peace. Yet Carter is infamous for his haughty, priggish sense of moral superiority.
    “This is what the Nobel Peace Prize really stands for: irresponsible moral posturing in the service of the leftist delusion that appeasement will bring peace, when all it really brings is more war. “

Friday, 9 October 2009

Beer O’Clock: Who's Your Nanny?

Looks at Geoffrey Palmer (aka, the Unbridled Wowser), Maurice Bennett, Brew Dog, an 18.2% beer, a 1.1% beer, alcohol prices and something called Townshend No.9.

AS NEW ZEALAND INCHES towards a hospitality environment regulated by the whim and fancy of Geoffrey Palmer, it is worth considering the situation in the United Kingdom which, if anything, might be even worse.

Here, Maurice Bennett Esq, a noted man around town (unlike old Geoffrey), got in the most minor of trouble a few years back for his advert which dared to insinuate that a beer called “Bennett’s Strong” was, in fact, quite strong.  The ‘offending’ ad was quietly pulled. 

In the United Kingdom, maverick Scottish brewers BrewDog are constantly at odds with the advertising authorities and the suffocating Portman Group.  These organisations have tried to ban a number of BrewDog beers or at least limit their promotion.  Beers on their puritanical hit-list have included Rip Tide, Hardcore, Punk IPA, Speedball and Hop Rocker.  Astute readers will note that is virtually their entire range

pic7 The latest beer to be attacked was BrewDog’s Tokyo - at 18.2% it is one of the strongest beers available in the United Kingdom.  It came under fire from the usual suspects and Members of the Scottish Parliament for being irresponsible and promoting binge and/or under-age drinking. 

Given a bottle of Tokyo yields no change from a ten quid note, the chances of teenagers quickly necking a couple of Tokyo’s before heading into the city seem remote.  Beer writer and Malthouse beer hero Pete Brown did some maths to prove that Tokyo would hardly be the choice of value-driven problem drinkers.  He calculated how many units of alcohol could be purchased at a supermarket for £1 across a range of drinks.  Tokyo was at the bottom. 

Here are the results:

Tokyo - 0.61 units of alcohol for £1
Blue WKD - 1.4 (RTD)
Stella (normal price) - 2.39
Carling - 2.7
Kiwi Sauvignon - 2.84 (Wine)
Grant's whisky - 3.07 (Spirit)
Stella (promotional price) - 4.5

BrewDog has responded the only way they know how – with beer.  They have created a beer called Nanny State, a 1.1% hop bomb.  Their press release notes:

    “At BrewDog we appreciate your inability to know your limits - especially when it comes to alcohol – which is why we've created Nanny State.  This idiosyncratic little beer is a gentle smack in the right direction.
It's time to draw your net curtains, sit back with Nanny and watch your favourite episode of Last Of The Summer Wine. It's finally safe to enjoy alcohol again.
Please note: BrewDog recommends that you only drink this beer whilst wearing the necessary personal protective equipment and in a premises that has passed a full health and safety risk assessment for optimum enjoyment.”

In a somewhat ironic twist, Nanny State apparently has such a low-alcohol content that the State does not class it as a beer and it was not subject to beer duty.  Is it a glimpse of where we are heading?b784612f072f309999b00c55d16c7076_28762

OKTOBERBEST, WELLINGTON’S NEW BEER-DRINKING tradition, is well underway now.  Some of the beers patiently waiting their turn to be on tap down at the Malthouse include the award-winning Emerson’s strong wheat beer BeWITched, the award-winning Pig and Whistle from Harrington’s and the rare, decadent Dux de Lux Pinot Porter

Currently being served from the cask (as it should) is Townshend No. 9 stout.  It is from a small farmhouse brewery in the Upper Moutere Valley which makes a number of real ales and traditional beers.  The brewing water is drawn from a 501-metre bore and is estimated to be 25,000 years old (and therefore very pure).  This is a black beer with a short, tan head.  The almost oily texture carries mild notes of burnt toast and coffee before a smooth finish.

Finally, in Oktoberfest news, Michael Jackson’s father has continued the fledgling trend started by Paris Hilton of being banned from the festival.  “Music mogul” Joe Jackson requested access to a VIP marquee at Oktoberfest but was refused entry by event organiser Sepp Kratz.  Herr Kratz said Mr Jackson should not be partying after his "child has passed away."

Sometimes truth is stranger than fiction.  I feel like a beer.


Beer Writer
Real Beer New Zealand 
Beer and Brewer Magazine

[Cross-posted at The Malthouse Blog at which establishment it is rumoured that these two beers may soon make their way.  The handsome yet softly spoken proprietor is an avowed fan of free speech (and indeed of anything free).]

Friday Funnies

From John Cox Art 


What’s that, you don’t think the last two are funny?  I think they’re frickin’ hilarious.  Click on each of them to discover why, and who the joke’s on.  And just so you leave with a chuckle, rather than sigh, here’s three piece of good advice on baby care – and there’s plenty more where they came from at How to take care of your Baby for Dummies. [Hat tip Noodle Food]
1017 1010 1005

Friday morning ramble

twitter_logo_header It’s not possible to talk here at NOT PC about every good story and every great link I read or you send me. That’s what my Twitter page is for, where you can can get all these links to great reading “live” if you’re visiting there regularly. But if you haven’t been reading regularly enough, or you wanted a wee reminder about something you meant to check out, then here’s your (ir)regular Friday ramble through this bunch o’ liberty links. 

  • Lindsay Mitchell writes about Pseudo solution to pseudoephedrine problems, with evidence from bans on sales in Oregon.  This is the sort of thing John Key should be reading if he wants evidence-based advice.
  • Can We Really Trust The Leading Economic Indicators? Um, not really, says Mish.
  • Water, cigarettes and sheep - the three currencies that helped rebuild a part of Iraq after the war. Another story of how money is a creation of the market, not a creation of governments.
  • HEALTH: There's "a problem in the U.S.A," alright. Another kid-cult video to join the hundred of other kid-cult video singing praises to the Messiah!
  • Oops. Annette King can't tell the difference between the parody Sue Kedgely & the real one. Mind you, nor can Sue
    Wonder how Annette King will go with RogerDouglasMP:
  • Westpac economists suggest NZ's floating exchange rate helps reduce the price volatility of its commodity exports. Interesting argument.
  • How inconvenient: “Ice melt during the Antarctic summer of 2008-09 was the lowest ever recorded...” But I’m sure you’ve already heard that news from your friendly, local, reliable mainstream news media, right?
  • Uh, maybe not so reliable. UMR Poll says news media have credibility issue. Only 35% of NZers believe the media is accurate. That many?!
  • They’re trying to censor the internet – the buzzphrase for censorship is “net neutrality.”  Read “Net Neutrality: Toward a Stupid Internet,” and arm yourself for the coming battle.
  • There’s a frickin’ elephant in the schoolroom all right!
  • NZ Economic weather report: Electricity lines and power prices rising faster than the CPI . . . who would have thought that a government-owned and regulated ‘market’ would be so inefficient.
  • NZ BabyBoomer lifestyles are ‘coming home to roost’ as credit defaults jump 19.4%.
  • Lindsay Mitchell looks at the true extent of unemployment: Most folk don't know how the unemployment rate is calculated, which is very convenient when you want to hide some embarrassing numbers.
  • Hallelujah! NSW now require teachers to spend part of each day teaching the sounds that make up words.
  • Ecozealots ditched toilet paper for a year  . . . and they’re now selling deadtree books & packaged DVDs to “save the planet” – and to make themselves famous. A fair trade?
  • Speaker Pelosi Hints at Massive US Tax Hike
  • Winning the Unwinnable War Here’s A Book Every Military Strategist and Politician Should Read . . . To learn more about the book, or read an excerpt, visit:
  • Mish calls talk about those "secret" moves to trade oil in currencies signalled by Robert Fisk. "Ridiculous hype" he calls it.

Great quote to counter a popular straw man:
"An individualist is a man who lives *for* himself not *by* himself."
(Said by an 8-year-old girl!)

  • Has the govt breached New Zealand's international trade commitments by funding Maori Television? Liberty Scott thinks so.
  • Green Shoots? Nouriel Roubini says US unemployment will rise through 2010. US economy is "shopped out" he says.
  • It’s way worse than we feared: @drmabuse interviews an FTC spokesman about the US Government’s proposed new "guidelines" to be forced upon bloggers.
  • This report on the imminent demise of the US dollar is worth considering, but since it includes the words "Robert" and "Fisk," be sure to consider Mish’s assessment as well.
  • American children singing songs of praise for Barack Obama are a little much, says Thomas Sowell, “especially for those of us old enough to remember pictures of children singing the praises of dictators like Hitler, Stalin and Mao.”

    “But you don't need a dictator to make you feel queasy about the manipulation of children. The mindset that sees children in school as an opportunity for teachers to impose their own notions, instead of developing the child's ability to think for himself or herself, is a dangerous distortion of education.”

    Read A Letter From a Child by Thomas Sowell

  • What a great title for a blog post: 'The plural of anecdote is not data.' Love it.
  • Companies run regular fire drills, so why not regular phishing drills? Seems a fair question.
  • Peter Schiff: 'The real economic crash has just started' (Oct. 03) One hour speech on video.
  • Not mention the GDP delusion: "stimulus" & retail subsidies aren't "growth" - just more capital consumption
  • NZ Govt spending on the basis of a multiplier is suspect-anyone trying to sell these policies isn't to be trusted
  • ARC: "Just War Theory" Is Unjust to Americans - and to NZ soldiers in Afghanistan being put in harm's way.
  • Latest #parenting post at Rational Jenn’s is all about avoiding being a helicopter mum.
  • He was arrested by a bully, betrayed by a coward, and now it’s being covered up by Big Brother.  Read about Dan Edge’s plight here:
  • The market should be replaced by democracy, says Michael Moore. But as Ludwig Von Mises would have told him if Moore could read, the market is democracy.
  •’s take on Polanski and the Hollywood letters made Get Frank laugh a few times [Really good]
  • Okay, the Community Reinvestment Act helped spark the whole crisis in the first place.  So why do you think Team Obama aims to expand it?
  • The Copenhagen Climate Change Treaty draft looks less of a climate treaty and more of a blueprint for world socialism.  Take a look.
  • The US  Federal Trade Commission will soon requires bloggers to disclose payments, dictating what counts as payment & disclosure.  Chilling.

Something for politicians, mainstream economists and Reserve Bank Governors to think about:
“True, governments can reduce the rate of interest in the short run. They can issue additional paper money. They can open the way to credit expansion by the banks. They can thus create an artificial boom and the appearance of prosperity. But such a boom is bound to collapse soon or late and to bring about a depression.”
- Ludwig Von Mises, Omnipotent Government

  • "The politics [of global warming] are tough now because conservatives years ago allowed the debate to get away from them; frightened of being labelled nature-haters, they declined to attack anti-progress green arguments as they were being formed. Result: in 2009 they’re dealing with a full-blown religion, and they’re discovering that logic isn’t much of a weapon against faith.”  (Tim Blair’s throwaway remarks have more insight than most people’s long-considered arguments.)
  • ‘Smart Growth’ and the coming ‘Housing-Led Recovery’ – or, to put it another way: ‘Oxymorons for Morons’
  • Apple vs Apple vs non-Apple. Have you heard about about the “moron in a hurry"?
  • COOL MAPS: How to explode the idea of over-population in three simple maps: The most populated country on earth, the Netherlands, shown at three different densities. So where’s the over-population?
  • Capitalism FAILS. Capitalism the movie, that is.
  • The Australian Prime-Minister and the US Presidential family both regularly challenge the time-space continuum. Something at which Helen Clark wasn’t too bad either.
  • Caught in the Act: A funny tribute to guys who think they got the sneaky glance but got snapped.
  • Where’s the Top 6 - Beer Towns In New Zealand? Get Frank has the answers you’re looking for:
  • MORE COOL MAPS: Failed States: A neat interactive graphic showing which states in the world are at risk of failing.
  • "Governments failed to let wages and prices adjust in the 1930s and they’re doing the same thing again now." No Virginia, governments don’t learn from their mistakes.
  • A restaurant that serves you what the last guy ordered offers a nice warning for all you 'market failure' theorists:
  • Here’s a novel idea for ObamaCare enthusiasts: considering the impact of health care “reform” on doctors: Investor’s Business Daily has done the heavy lifting for you:
  • Psychological Distance And Poetic Excellence considered at the Poetry Blog. It works the same for art, you know.
  • Environmentalists want to destroy four American hydroelectric plants. And you thought they liked renewable energy?
  • A dose of libertarianism would enhance our democracy, says 'former' Australian Fabian socialist.
  • Read this amazing reply from a US librarian in reply to a request to remove a children's book on gay marriage. Would that all bigotry inspire such resolute eloquence.
  • Not sure how George H. Smith would handle this, but... Penn Jillette discusses the Beatles as proof of God.
  • Ireland's 2nd vote in 2 years on EU's Lisbon Treaty is a "yes." Given it was "no" last year, isn't it now one all? Or doesn’t it work that way with things the government wants?

Observe that in all the propaganda of the ecologists—amidst all their appeals to nature and pleas for "harmony with nature"—there is no discussion of man's needs and the requirements of his survival. Man is treated as if he were an unnatural phenomenon. Man cannot survive in the kind of state of nature that the ecologists envision—i.e., on the level of sea urchins or polar bears. . . .
- Ayn Rand (1971), "The Anti-Industrial Revolution," Return of the Primitive

  • Maybe you should keep this one on file for Sunday: Diana Hseih’s ‘Rationally Selfish Radio’ Podcast #11: The Ontological Argument for the Existence of God.  Or not.
  • It was supposed to be International Free Press Day, but the supposedly free press flunked it. “The Danish cartoons story was a test, and the civilized world failed it.”
  • The decision to hold the Olympics in Rio may be bad news for Chicago, but it may be great news for America!
  • What - or Who - Started the Great Depression? The answer in an abstract for a new working paper reads thus: Herbert Hoover.
  • On the occasion of Ludwig Von Mises’s 128th birthday, George Reisman pays him the ultimate tribute: "His teachings are nec­essary to the preservation of material civilization.
    Ludwig von Mises: Defender of Capitalism – George Reisman 
  • Are We Raising a Generation of Wimps? Onkar Ghate answers at PJTV.
  • The 'U6' measure of US unemployment has risen to 17%. And since it’s similar to the methodology used during the Great Depression, U6 offers a better historical perspective on the severity of our current crisis – what this shows is that US unemployment is already at Great Depression levels, with the employment market still contracting.
  • Here’s Peter Schiff on ‘The Recovery That Isn't’
  • Israel Has A Moral Right To Its Life:Israel is [still] America's frontline in the war on terrorism. (2002):
  • Why the Palestinian People Do Not Deserve Independence (2002)
  • The Purpose of a Palestinian State (2002)
  • Another warmist hockey stick broken? Here are the stories:
    Or maybe not? Warmists defend the stick:
  • Obama now has negative rating on 5 of the top 6 issues Americans now consider most important:economy, health care, budget deficit, unemployment, & taxes.
  • And finally, Nanny state drinking lawsthat a Sue Kedgley would love: Show a license to buy a pint.

"Money is the tool & symbol of a society built on mutual, voluntary trade rather than forced labor, duty to the state, or war."
-Ayn Rand


2009 NZ Timber Design Awards

If there’s one thing NZ architects should do well, it’s design in timber – especially now that plaster has so dramatically fallen out of fashion.  And since the entries for the 2009 NZ Timber Design Awards have just been posted, you can see just how well they can do.

Crosson-Clark Glade-House-1-LB

Here’s just a few of the two dozen or so entries.

House-at-Rotokauri-1-Thumb LEMP-1-LB

Click on the photos to go to the project page for each one.

Yellow-Treehouse-3-LB Style:

Do you have a favourite? 

Oriental-Bay-House-1-LB Yellow-Treehouse-2-Thumb

Thursday, 8 October 2009

No Treasury No! [update 2]

The Herald reports: “New Zealand needs to overhaul its tax system . . . potentially increasing GST or imposing a land tax“!

And Farrar agrees – wouldn’t you know. “Go Treasury Go ,” he says.


What New Zealand needs is not new taxes, but fewer taxes.  It’s not a “broader tax base,” it’s fewer tax victims.  It’s not “slower growth in government spending,” it’s no growth in government spending. None at all.

What NZ really needs – especially at this time when businesses are struggling with lower returns – is drastically reduced government spending. It’s  the urgent removal of all the regulatory handbrakes on real production.

The correct response to calls for new taxes and a broader tax base is not “Go Treasury Go ,” but No Treasury No!

UPDATE 1:  I like this comment over at PM of NZ:

“As the hand wringers argue back and forth about a CGT and speak at great length about the pros and cons of raising Grab Snatch and Take, I do wonder if the priorities are totally wrong.

able to continue to deliver the revenue needed to fund what we have come to expect from the state.

Always about raising the take, never lowering it. “

Isn’t it ever the way.

UPDATE 2: And this, from Cactus Kate:

Forget saying no to "P" and other drugs of choice. Say "No" to new taxes. They are potentially far more harmful for government spending addicts.

Does anyone (still) need another libertarian straw man?

There are so many straw men flung at libertarians that we must almost be eligible for some sort of agricultural subsidy. (This, in case you missed it, is irony).  And over at Dim Post right now most of the usual straw men are being flung by commenters there with all the usual abandon – on a post that somehow links the move by the un-libertarian Rodney Hide to do something or other about dogs to the supposed problems a libertarian would have with packs of wild animals.

Yes, risible, I know – but all the usual straw men are on display in the comments there.

So this prompted me to dig up and link to and old post by Jonathan Pearce at Samizdata who, with some of the Samizda commentariat, between them collected up some of the most common of the well-known libertarian straw men, most of them in evidence with the Dim Bulbs:

  • Free marketeers do not believe in law and rules of any kind.
  • If you are a skeptic about global warming and other alleged environmental terrors, you care nothing for future generations and might also be in the pay of Big Oil.
  • Libertarians believe in the idea that humans are born with a mental "blank slate" and hence pay no heed to inherited characteristics of any kind.
  • For capitalism to work successfully, everybody has to be obsessed with making money all the time.
  • Capitalism can only survive in an expanding economy.
  • Libertarians are uninterested in preserving certain old traditions and cultures.
  • Libertarians tend to be loners and discount the importance of community life.
  • If you've done nothing wrong then you have nothing to fear from a state-sponsored identity card.
  • By opposing state ownership, libertarians are taking things away from people - education, healthcare, food from their mouths etc.
  • Libertarians talk as if every family lived on its own forty acres, and that everyone is more or less an equal player.
  • Libertarianism ignores the collective power of modern corporate capitalism.
  • Libertarianism is fantasy. The world needs pragmatic political and economic thought, not some deeply rationalist philosophy that has never, and will never, reflect the reality of the world we live in.
  • Both Marxist and libertarian may congratulate themselves on their superior and enlightened understanding of how society ought to be run...
  • ...It's a case of 'every man for himself', and devil take the hindmost...
  • An easy example of market failure in this regard is homeopathy ... yet the stuff still sells. This is is not rational behaviour.
  • Libertarians deny human nature ... in the Libertarian fantasy, once Libertarianism is brought about ... everything with go swimmingly.
  • The problem with economic libertarianism, is that it has to repress the human instinct to organise into collectives.
  • Libertarians would prefer to revert to a state where hired help was cheap and the person
    cleaning the street lived in a slum and had a life expectancy of 35.
  • Libertarians evidently want a pure abstract system where people make choices purely based on me me me.
  • Libertarians are all selfish bastards who want to see people dying in the street
  • Libertarianism lauds union-busting,but ignores the power of corporate collectivism.
  • The market was created and is sustained by 'government intervention'.
  • You don't believe in public education? You must want everyone to be uneducated!
  • A Libertarian is just a dumb conservative who wants to be able to do drugs and cheat on their wives without feeling guilty.

More straw men there than a thousand-acre field in Kansas. And just for the Dim Bulbs, these are things libertarians don’t agree with, okay.

Read rebuttals of most of those canards here in the original post and the comments thread (and in the many, many Cue Card Libertarianism posts down there on the right-hand sidebar) and feel free to post any others in the comments below – just as you did when I first posted this.

Local media does bad

Ever done something, seen something or been involved in something that’s made the news? Have you been able to recognise what’s been reported as being anywhere close to what you know actually occurred?

If you answer that the way I think you will, then rest assured you’re not alone.  A new UMR poll suggests that NZers generally discount what they receive from our local media:

  • Only 35% of NZers believe the media is accurate. That many?! I’m surprised.
  • Around one-quarter of respondents said local media is definitely inaccurate – and these weren’t just the people who still read the Sunday Star Slime.

Frankly, that’s appalling - but for our shallow, vacuous unreliable local media it’s a richly deserved result.  What Lindsay Perigo called “braindead” when he walked out on the TVNZ newsroom in the early 1990s would now be seen as too intellectually challenging for prime time viewing – and sadly, there’s no sign of any improvement.

That’s sad.

But do you know what I find truly amusing?  It’s that I first read this news about the news at Bill Ralston & Janet Wilson’s blog, where Bill takes the opportunity to put the boot into the “tabloid trivialisation of news, which again undermines audience and reader respect and trust.”  And why is that so amusing?  Because it was Bill, if you recall, who spent four years doing to TVNZ news what he’d previously done to Metro magazine, taking them both resolutely down-market into tabloid land, destroying whatever remaining credibility either once had, and with it their audience and readership respectively.

So “warnings” about credibility from Bullshit Bill should be taken with a little pinch of something he’d put on his long lunches.

Local boy does good

Christchurch student Brad Taylor, who blogs at Brad Taylor’s Blog, just won first prize in the student division of The Independent Institute’s Templeton Fellowships Essay Contest. His prize-winning essay ‘Virtue and the Voluntary,’ for which he won US$2,500, is here.

Onya Brad.  :-)

And another nearly local boy also did pretty well in the American contest. Australian Ben O’Neill, who’s featured in The Free Radical and whose articles appear regularly at the Mises Daily, won first prize and US$10,000 in the Junior Faculty for his essay ‘The Threat of Virtue: Why Independence and Integrity Threaten the State.’

NOT PJ: Ploughing your own Rut

This week Bernard Darnton wonders what could be worse than working class alienation and discovers the answer.

good-life-felicity-kendalFelicity Kendal has a lot to answer for. Her starring thinking-man’s-crumpet role in The Good Life is probably responsible for the perennial popularity of self-sufficiency.

The latest incarnation of this fad (that I’ve noticed) has been a thing called Beachcomber Cottage, in which our subject, Monty Halls, decides to live in a crofter’s cottage on the Isle of Skye, off the West Coast of Scotland. Self-sufficiency was hard enough in Surbiton; it must be horrific with a howling gale, uninterrupted for three thousand miles, slamming the Atlantic Ocean through the holes in your walls. Imagine Wellington, except cold, wet, and windy.

_BernardDarntonThe plan was to only eat things that he had grown or caught himself. In the episode I saw he was attempting to catch mackerel. Mrs Darnton’s enjoyment of the programme was completely ruined by me exclaiming every few moments, “how can he call himself self-sufficient when he didn’t make his own fishing rod.” All she said was, “Shush,” which I always take to mean that I’m completely, 100-percent, incontrovertibly right.

And I bloody was. There was no evidence whatsoever that his tumbledown crofter’s cottage contained the pyrolising furnaces, autoclaves, and various high-tech machine tools necessary to make a carbon fibre fishing rod. In fact, the whole area was barren and tree-forsaken. He’d have struggled to find a stick to make one of those Winnie-the-Pooh fishing rods.

For the sake of not being an irritating pedant, let’s assume that Monty got the fishing rod for Christmas and its use is not excluded by the “only eat what I catch or grow” rule. When he finally hauled in a handful of mackerel he marinated them in brown sugar. Bollocks to self-sufficiency again. Monty’s inventory of machinery was non-existent so a sugar plantation, even by itself, would have been hard work. He couldn’t have harvested the cane the old-fashioned way because the boatload of Africans would never have survived the Western Isles’ sub-sub-tropical climate.

Likewise the salt that the rest of the mackerel were preserved in. Now, to make salt you only need seawater and sunshine. The seawater’s delivered to your door at a hundred miles an hour. The sunshine’s harder to come by.

When he pulled out a bottle of wine to celebrate his catch I lost the plot.

The fact is that, despite the turnip growing and the obligatory pig slaughtering, to support one lonely fantasist requires all the machinery of modern civilisation. Just the knife to kill the pig with requires a steel mill, a smelter, a coking plant, container ships, a railway, a coal mine, an iron ore mine, and pubs and brothels strewn across the boondocks of Western Australia.

So trying to do everything yourself is just bloody silly. Harvesting scallops from just off your back doorstep has a certain appeal but who’s going to run the atmospheric liquefaction plant that supplies the oxygen for your scuba gear?

Off camera, self-sufficiency would mean no scuba gear to get the scallops, no fishing rod for the mackerel, no sugar, no salt, no knife to kill the pig, and that leaves just the turnips. There’s a reason we invented division of labour – because without it, even if you weren’t dead by thirty, you’d want to be.

* * Read Bernard Darnton’s NOT PJ column every Thursday here at NOT PC * *

‘Cheers’ – Jerald Rough


Here’s an ‘unusual’ still life for you – a piece you can purchase from the Cordair Gallery.  As Linda Cordair says, “What kind of painting goes with your Monday night football?  This kind!”

Wednesday, 7 October 2009

There’s a frickin’ elephant in the schoolroom [update 2]

If there’s a silver bullet for improving the appalling literacy rates of the youngsters who leave NZ’s factory schools it’s not National Bloody Standards, it’s phonics. Phonics from an early age to teach youngsters properly what those marks on the page sound like, and at a later age to repair the damage of those teachers who told them the marks themselves didn’t matter – that it was okay just to guess.  Australian columnist Janet Albrechtsen talks about the reintroduction of phonics in her own neck of the woods [hat tip Leighton Smith]:

    “It’s not often one gets the chance to say this: New South Wales is doing something right. At least it is when it comes to literacy. In recognition of the importance of phonics, New South Wales teaching guides now require teachers to spend part of each day teaching young children the sounds that make up words.
    “It sounds like a no-brainer that children should explicitly be taught the most basic building blocks of learning to read. Yet one more hurdle - the most important one - remains. New research reveals that new teachers on the cusp of entering our schools have little understanding of how to teach phonics.. .”

No wonder. The elephant in the literacy room is the failed ‘whole word’ – or ‘look and guess’ – method of scaring children away from learning to read, a non-method of non-teaching made up out of whole cloth by wholly ignorant academics. Yet the fight to rid schools of the ‘look-and-guess’ nonsense has been interminable, internecine, and still ongoing.

    “The drawn-out delays over better literacy teaching are nothing short of scandalous. This is not some piddling policy that can be set aside for another day. These delays hurt our most disadvantaged children the most; they often miss out on the added support of engaged parents willing and able to encourage reading.
    “These are the children politicians love to talk about when they use their grand rhetoric about education. . . ”

. . . and then generally leave behind once they get into office and get captured by the teacher unions. So it’s gratifying indeed to see there’s baby steps being taken, at least on one side of the Tasman.

  The next critical step is to teach our teachers how to teach reading. . .”

Sure is. But you’ll have to teach most of them to read first.

You have to laugh, or else you’ll cry.

And to help you laugh, here’s a funny story told by a favourite reading teacher of mine – a man who teaches troublesome teenagers to read in the blink of a five-day adventure camp. A story about a frickin’ elephant . . .

Five-year old students are learning to read.

Yesterday one of them pointed at a picture in a zoo book and said,

"Look at this! It's a frickin' elephant!"

I took a deep breath, then asked..."What did you call it?"

"It's a frickin' elephant!

It says so on the picture!"

And so it does...

" A f r i c a n Elephant "

Hooked on phonics! Ain't it wonderful?

UPDATE 1:  By the way, my friends and colleagues at the Maria Montessori Education Foundation – who swear by phonics – tell me I should remind you about two upcoming events for parents in Tauranga, this weekend, and Wellington in two weeks time.

TAURANGA: PUBLIC ADDRESS - 'The Child - A Social Being'
London-based Montessori trainer Cheryl Ferreira talks on Saturday October 10th on how the first step in ‘the child as a social being’ is to help the child develop all his functions as a free individual, which is what fosters that development of personality that actuates social organisation.
* * Saturday October 10th @ 7- 9p.m, $15 payment at the door (includes light refreshments)
* * Historic Village on 17th, Seventeenth Avenue, Tauranga
* * For ticket information and bookings email or phone Carol 021 111 4133.

WELLINGTON:  PUBLIC ADDRESS - ‘Children Creating and Developing Language from Birth Onwards' 
London-based Montessori trainer Cheryl Ferreira talks on Saturday October 17th on how children create and develop language from birth onwards
Join us to discuss the factors that impact on the development of spoken language from 0-6 and how this impacts on writing and reading'.
* * Saturday October 17th @ 7-9p.m, $10 payment at the door (includes tea &coffee)
* * Wa Ora Montessori School, 278 Waddington Road, Naenae, Lower Hutt, Wellington*
* * For ticket information and bookings contact or phone Anna on (04) 232 3428 by Tues Oct. 13th.

If you’re in Tauranga this weekend, I’ll probably see you there.  :-)

UPDATE 2: Sally reckons “Graham Crawshaw is to literacy and phonics campaign as Fred Hollows was to innovative cheap eye surgery.” Sally’s right.

And Graham now has a blog.  Set your bookmarks to:

DOWN TO THE DOCTOR’S: Philip Field, Fiordland and Foot to the Firewall

Libertarianz  leader Dr Richard McGrath takes his regularly irreverent look at some of the past week’s headlines.

richardmcgrath 1. Safety fear as Key car speeds – Nearly five years since Helen Clark’s government vehicle averaged nearly 130 km/h to catch a plane flight to a rugby game she admits held no interest for her, we have Speedgate 2 – John Key’s car, according to journalists who were there, reaching 120 km/h on a road in Samoa with a designated limit of 40 km/h. Key’s mouthpiece, Kevin Taylor, reckons the convoy didn’t break much more than 65 km/h. John, this is embarrassing. Get your facts straight. If you can’t reach a decent speed, at least kill the whole story. It is alleged that Helen’s car got to 170 km/h between Waimate and Christchurch. For goodness sake, 65 km/h isn’t in the same ballpark. Shame on the wimp who was driving you around Samoa, John. A real man would have tossed the driver out the door and put foot to the firewall. Full speed ahead, and damn the torpedoes. Villagers and dogs who got in the way could always be written off as tsunami victims. Memo to John: study the car chase in the Steve McQueen film Bullitt, and next time try harder.

2. Taito Philip Field makes Labour squirm – Oh dear. Labour are circling the wagons after the incarceration of former poster boy T. P. Field. After defending him for a year, and emasculating Auckland QC Noel Ingram’s initial attempts to investigate an allegation of conflict of interest against Mr Field, Labour politicians find themselves in the unlikely position of having little or nothing to say, apart from some mumblings about New Zealanders being equal under the law. Oh, except if you’re the Prime Minister and your car is doing 170 km/h on the way to the airport. The rest of us are cash cows for the traffic Stasi. One irony of the whole sorry T. P. Field saga is that he was earlier convicted and fined $20,000 for a non-crime: converting a garage into a family room and a carport into a garage. Nice to see politicians getting a taste of their own fascism.

3. Fiordland listing a ‘disgrace’ – We’ve been told the government is considering opening Fiordland up to oil and mineral exploration. Hurrah! The Greens are trying to kill this attempt to lessen our dependence on oil imports. Sheesh. Green co-leader Metiria Turei (the Greens don’t think a female could take on the leader’s role without a male to hold her hand) says “they are keen to mine our most precious parks.” And why not? Mankind’s whole existence has relied on adapting the environment to our needs. If the skill of fire-lighting had not been utilized, millions of us would have perished in the cold. Oil exploration is a corollary of mankind’s rightful domination of this planet and the harnessing of natural resources to further the survival of our species. Once again the Greens wrap their anti-human, anti-life agenda in a veneer of compassion and expect us to lap it up. But Metiria needn’t worry – the invertebrates on the Treasury benches are starting to back down already. “Claims that the government is considering granting oil companies exploration licenses in the Fiordland National Park are simply hysterical!” sobbed Energy and Resources Minister Gerry Brownlee, after caving in to extreme pressure from Green Party cabinet minister Nick Smith.

See y’all next week!
Doc McGrath

‘Crime’ & Punishment [updated]

061009NZHPEFIELD01_300x200It doesn’t happen often, but I’m with Psycho Milt.  There’s something wrong when helping out immigrants in return for some free tiling, and then lying about it, gets two sentences amounting to six years in total – but killing another motorist because they’ve scratched your BMW gets you just three.

There’s something wrong when those sentences for this ‘crime’ are made cumulative, when the sentences for the “human waste” who killed Karen Aim and tried to kill Zara Schofield was made concurrent, “thereby letting him off for the attempted murder and making it clear to the victim of that attempted murder exactly what the judge in that case thought she was worth: nothing.”

The message here is that taking someone’s life, or trying to, is some way down the scale of “bad things to to do in New Zealand” from a political crime – from taking some limited advantage of your position and then trying to conceal it.

Help for some immigrants in return for some free tiling -- and lies about it – these things are "...intolerable in our society and threaten the institution at the foundation of democracy and justice."  But kill people, or try to, and that’s not so bad.  That’s the message from Justice Hansen and his colleagues on the bench.

Frankly, Field has already had whatever punishment he might have actually deserved in his fall from grace and the public shaming he’s experienced.  Frankly, locking Phillip Field up for six years looks nothing like making the punishment fit the crime -- it’s more like making the punishment fit the politics.

This is not justice; it’s retribution.

Field’s real crime is that he fell out of favour with the ruling party just as they were falling out of power.  Because if taking advantage of your position and then trying to conceal it in the manner that Field did was genuinely intolerable and a threat to our institutions, then surely the collar of Bill English would be being felt about now.

LIBERTARIANZ SUS: Israel & Me (Part Two)

Concluding yesterday’s column by Susan Ryder. We left her on her way to do her O.E.  . . .

Fast forward to August 1984. I had arrived back in London after travelling around Ireland. Deciding that I’d firmly exhausted my quota of crappy, menial short-term jobs, I remembered a conversation with an Australian girl some six months earlier who had just returned to the UK after a spell in Israel. She’d had a great time so I made some enquiries. Ten days later I was flying to Tel Aviv as part of a group of British volunteers to live and work on a kibbutz, via an organisation in central London that specialised in such arrangements.

If I needed proof that Israel was a different kettle of fish (gefilte) to other places I’d visited, it was evident before I ever left Britain. In those days there was a separate area of Gatwick Airport specifically reserved for passengers travelling to and from Tel Aviv and Belfast. One of the delights awaiting me prior to boarding was an external body search. It remains my only experience to date and one I’m in no hurry to repeat.

David Ben-Gurion Airport proved to be symbolic of Israel itself: plain, functional, (albeit it in a dry, dusty, Middle-Eastern sort of way) and largely unconcerned with creature comforts. It put me in mind of an aircraft hangar at RNZAF Ohakea near Bulls, a thought that still makes me chuckle.

Its organisation, though, could not be faulted. Israeli authorities have a knack of getting things done with minimal fuss. In next to no time we had cleared formalities, collected our bags and were on a shuttle bus for the journey to Kibbutz Gal’ed further north.

Something that always intrigued me was Israel’s tiny size compared to its global significance. Seldom, if ever, out of the international news circuit, it is roughly one-tenth the size of New Zealand. And yet since its establishment in 1948, this small piece of land remains politically contentious and sought after.

A history of kibbutzim is a history of Israel. Right from the start, the small collective-based settlements neatly doubled as defence outposts. The division of labour saw all children being raised by a handful of women, leaving the majority to work alongside the men for maximum productivity. Meals were communal with the cafeteria being the heart of the settlement.

My kibbutz was typical, consisting of several hundred members. Black and white images on display of its early days bore no resemblance to the settlement I knew. In 1948 it looked like a moonscape: bare, barren and desolate.

By 1984 however it was a modern village boasting acres of apple orchards and a productive dairy farm. Like many kibbutzim, Gal’ed had removed their Jaffa orange groves in favour of growing cotton for better return. The members all lived in neat apartments containing all modern conveniences. And few, if any, children lived in the ‘Children’s House’ anymore, although they still received their primary education there. There were well-maintained lawns and gardens, thanks to vital irrigation systems in a land where access to water is an ongoing concern. The large cafeteria remained central to community life, but many members chose to eat privately in their own homes. In the early days, by contrast, it was almost impossible to even get a cup of tea outside the cafeteria. In spite of their prevalence, only a very small percentage of Israel’s population live on kibbutzim, but the model remains a successful example of collective living.

I quickly learned that Israel is a land of contrasts.

One of the first things to strike a visitor is the immediate security everywhere. It’s a fact of life. Barbed wire sits atop all major buildings and fences. Every second person is a soldier in uniform, with sub-machine guns casually slung over shoulders. And every second vehicle belongs to the military.

But its massive presence is enormously reassuring, the troops being well-trained and well-disciplined. At that time, every non-Arab citizen was required to join the army at 18 years of age, women for two years and men for three, with an annual refresher thereafter for men.

So with all that security, I would have thought hitch-hiking was out. Not so. Everybody – and I mean everybody – hitched rides. Drivers would just stop, enquire as to your destination and have you jump in the back. We’d been told that a concrete pecking order was in place, foreign tourists running a definite third behind female and male soldiers respectively. That turned out to be less than accurate. Males are males, no matter where you go – and there is some advantage in being young, female and not altogether stupid.

Having said that, the people themselves were the most unfriendly I have ever encountered, often verging upon downright rudeness. At first it’s a bit dazing, but then becomes rather comical if you have a sense of humour. Many just didn’t bother with social niceties toward strangers. The brusqueness derived from a sort of wariness of the rest of the world, I believe, because in due course they softened and I made some good friends. On the kibbutz I became very friendly with several migrant families from South Africa and South America, who were delightful. I spent numerous evenings in their homes, listening to their stories and learning about Israel and Judaism.

The people I met wanted to be known as Israeli rather than Jewish, i.e., for their nationality as opposed to their religion. Most people I encountered led secular lives, visiting the synagogue for traditional ceremonies only. Generally, they had little or no time for the black-garbed Orthodox Jews I would sometimes spot in Jerusalem who, I was told, still spoke Yiddish rather than Hebrew because they disapproved of the resurrection and use of what they considered a sacred tongue.

Some claimed that Orthodox Jews had been known to oppose the creation of the Jewish homeland; that their existence as God’s chosen people was supposed to be arduous in this life and actively funded the PLO as a result. I know it sounds bizarre, but there it is. Trust me, oddity and contrast are blood brothers in this part of the world and besides, it wouldn’t be the first time that people had offered themselves as sacrificial lambs. More, anyone who wears that ancient, heavy Eastern European clothing in that climate by choice is rather easy to put in the odd basket.

There is so much to discuss – much more than space permits, such as the biblical places. There is Jerusalem and its four distinct quarters where the world’s three major religions meet. Or Nazareth, where Christ grew up, and Bethlehem, his birthplace; a shabby little spot on the outskirts of Jerusalem where I found myself in the middle of an Arab riot while innocently eating yoghurt one Saturday afternoon. And the memorable day I spent time in the world’s oldest city, (Jerusalem), hottest city, (Jericho) and lowest point, (Dead Sea).

How the Holocaust is barely mentioned because you can’t escape it anyway and how your heart almost stops when you spot a faded tattooed number on someone’s forearm. But nowhere is it more evident, obviously, than Yad Vashem, the Holocaust Museum that is numbing in its clinical, chronological depiction of The Third Reich’s worst legacy.

There is the strange juxtaposition of people living a modern life in an ancient land, surrounded by hostile neighbours to varying degrees, with several of whom they have been at war. It is a land of gorgeous beaches and barbed wire. Of traders whose love of commerce goes back centuries. And the Palestinian issue which was not so much the proverbial elephant in the sitting room, as a herd of them.

If you thought this was going to be a political diatribe, you were mistaken. The Middle East makes Ireland look like a familial squabble by comparison, and requires a bit more than several hundred words to outline.

But what I can say is this. In my experience not one Israeli – not one – bad-mouthed Arabs either individually or collectively. They would openly and rationally discuss the situation, presenting many and varied opinions as to the best course of action.

But they all wanted the same outcome. Peace.

* * Read Susan Ryder’s regular column every Tuesday at NOT PC * *

Tuesday, 6 October 2009

Dairy bubble starts to pop – and guess who’s holding the pin?

The housing bubble went pop a long time ago, and now the dairy bubble is starting to burst.  The Crafars are the tip of a $28 billion pyramid of debt – a pyramid propped up by the very assets that have been inflated by all that debt.  I blogged about this back in June [Read the post: The credit/debt delusion: The faster you go, the bigger the mess]:

    “New Zealand farmers are in debt to the tune of $45 billion, 61% of which is in the dairy sector, leaving dairy farmers ‘reliant on continuing asset gains as income was never going to meet debt-servicing commitments’.  In other words, we’re looking at an agricultural debt bubble that is only being held up by an agricultural asset bubble that the debt itself has helped to inflate.
    “Oh dangerous times.
    “Many farmers have apparently been riding the bubble -- ‘farming for asset gains’ the Agriculture Production Economics report calls it – leaving them exposed on three fronts . . .”

  Home Paddock says “the announcement that Crafar Farms has been put into receivership is not unexpected.”  She got that right. The Crafars’ collapse indicates the first major signal that defeat on all three fronts is now upon us:

    “Bernard Hickey [analyses] the problems with the operation . . .      However [says Home Paddock], it’s not the size of individual farms or operations that’s the problem, it’s the rapid growth of dairying which has led to a shortage of good staff.”

Are you surprised?  Mainstream economists might be, but this is precisely what Austrian economists expect to see as the “rapid growth” of a credit-created boom turns into debt-based bust.   You see, Austrian economists understand two relevant things here that mainstreamers don’t:

  1. The first result of debt-based monetary expansion is that those borrowers who are ‘first in’ get first use of the new money before the inflationary results of that monetary expansion are noticed through the rest of the economy.  But the inflation of prices in the class of assets in which the new debt is invested is inevitable – even if it is confused for “growth” and “prosperity” instead of simply price inflation.
  2. The reason for the inevitable bust is not simply that these asset prices are inflated beyond real values.  It’s that the resources don’t exist to allow all the projects that the money has been borrowed for to be completed.

The first point is the problem of ‘farming for asset gains’ which I’ve already talked about before.  It’s this second point that Home Paddock identifies, and which I want to talk about here: that when all that “rapid growth” is happening, the resources necessary for all that growth don’t actually exist in either the quantities or at the prices that all the borrowers’ plans require..

Resources are now too short to complete all the projects all the dairy farmers planned, because the newly-created money funding all the new projects wasn’t funded out of the pool of real savings, but out of debt-backed credit created out of thin air – it’s what Austrian economists like George Reisman call counterfeit capital.  And since it’s unbacked by real resources, the resources for these new projects have to be bid away from where they used to be.

Now being ‘first users’ of all the counterfeit capital dairy farmers were certainly able (for a while at least) to bid resources away from those who hadn’t borrowed so heavily, and (for a while at least) were able to delude themselves that all was well, but in the end the resources simply don’t exist to allow all the projects they were planning on to be completed.

Home Paddock highlights the shortage of good staff. As Gene Callahan explains here so concisely,  that’s precisely the sort of shortage every debt-financed bubble inevitably experiences. The economy simply “runs out of gas.”

This is an important point to grasp about the booms created by our fractional reserve banking system, in which debt-based money is simply created out of thin air under the aegis of the Reserve Bank: that the resources don’t exist to allow all the projects backed by that newly created credit to be completed. It’s this shortage that is the primary cause of the inevitable busts of every credit-created boom.

If the credit was funded out of the pool of real savings however, then this problem wouldn’t exist. The pool of real savings would have been built up as a result of savers who abstained from current consumption -- allowing entrepreneurs to put those physical resources into long-term productive — and, the entrepreneur hopes, profitable — pursuits in the meantime.  But this is not the case in the fractional reserve system – the new money hasn’t appeared because consumers forewent their consumption, so those resources on which the borrowers relied are needed elsewhere, and it’s precisely the long-term projects that are crying out for them that suffer. As Tom Woods explains (based on the insights of Ludwig Von Mises), the entrepreneurs have been deluded by the artificially lower interest rates of the counterfeit capital into starting more projects than the economy can finish:

    “Mises draws an analogy between an economy under the influence of artificially low interest rates and a homebuilder who believes he has more resources—more bricks, say—than he really does. He will build a house much different than he would have chosen if he had known his true supply of bricks. But he will not be able to complete this larger house, so the sooner he discovers his true brick supply the better, for then he can adjust his production plans before too many of his resources are squandered. If he only finds out in the final stages, he will have to destroy everything but the foundation, and will be poorer for his malinvestment.”

In the case of New Zealand’s dairy farmers, one of the “bricks” on which they obviously relied was good staff – and in the end there’s not enough of them to go round.   A shortage of good staff is the primary resource of which they’re short.

And the really sad thing is that this effects good operators as well as bad: since those who have borrowed heavily are able to bid staff and other resources away from those who haven’t, the inevitable price competition acts to raise costs for both kinds of operations. And as resources become more and more scarce – as the “bricks” of each operation become harder and harder to come by – ( as Gene Callahan explains) the bottom lines of both kinds of operators suffer.

Essentially you discover at the fag-end of the whole process of credit expansion that all the new credit that fuelled the boom hasn’t actually funded new production at all : it’s simply inflated the prices of assets, it’s raised costs all round, and it’s funded increased consumption all round – including the consumption of real capital.

As Frank Shostak points out, everybody eventually discovers they’ve been robbed. Every entrepreneur discovers the resources weren’t all there, and certainly not  at the prices he planned on; everybody holding dollars discovers that their purchasing power has been diluted by all this new unbacked money; and everyone holding assets discovers all the price gains they’ve been celebrating have only been an illusion.

In other words, everyone’s been “robbed by means of loose monetary policy.”

So if you want to get angry at someone, don’t get angry at the Crafars – get angry at those responsible for creating all the credit-backed profligacy: at the denizens of the Reserve Bank.

It was them who inflated the bubble.  It’s reality that’s now holding the pin.