This week: How Bribes Win Elections – the reality and the problems.
1. DOM-POST: “Australia decides, finally” – “The Liberal and Labor parties have been locked in negotiations with independent MPs over the formation of their next government since the August 21 election failed to deliver a clear mandate. But Ms Gillard yesterday locked down the numbers needed for a parliamentary majority.”
The reality: Julia Gillard cuts a $10 billion bribe, just sufficient to secure the support of the wavering ‘independent’ MPs, so that she can cling to power.
The problem: A system that allows such naked bidding wars. An expectation that there had to be a government with the ability to ram through legislation through sheer strength of numbers, rather than debating each issue on its merits. The unedifying spectacle of Gillard and Abbott trying to top each other’s rural broadband bribes. The thought of Julia Gillard’s grating twang assaulting the eardrums of decent folk for heavens knows how many more months as Australia’s PM.
2 “DOM-POST: $15m package to keep workers afloat” – “The Government has stepped up its assistance to quake ravaged Canterbury with a $15 million package to help workers hold on to their paypackets as businesses struggle to get back on their feet.”
The reality: A little more than a year from the next election, John Key proposes giving $15 million of your money as a handout to small business owners in Canterbury. There are lots of Labour Party MPs in Christchurch and surrounding areas (Burns, Dalziel, Dyson, Cosgrove) as well as Jim Anderton. Cosgrove and Burns sit on majorities of less than 1,000 votes. John Key’s “package” could end up funnelling $100 million to his new friends in Canterbury.
The problem: The fact that the $15 million is not his to give. John Key playing favourites, manipulating the economy with money for which you might have had other plans (the bit that is ‘not seen’, as Frederic Bastiat put it), bailing out good and bad businesses alike. Kissing hands and shaking babies as he does a vote-buying tour of Canterbury with half the Cabinet tagging along on his coat-tails at our expense. The inconsistency of his actions—normally a business suffering earthquake, fire, flood damage or vandalism has to finance their own recovery via insurance that they had the foresight to purchase, and without taxpayer handouts (just as it should be).
3. NZ HERALD: “Australia ‘heading for boom’” – "’All of the pre-conditions that led to the General Financial Crisis are gone,’ Dr Gelber said. ‘The boom won't mature in 18 months, it will take six or seven years, or eight or nine.’ ‘Now is the time where I would go aggressively equity and away from fixed interest because the risk is gone,’ Dr Gelber said…”
The reality: None of the conditions that led to the global financial crisis are gone. It’s easy for Dr Gobshite to predict a boom in six to nine years, because he will have moved on from his job and his comments be long forgotten. Anyone who says “the risk is gone” in the context of economies and international markets should be approached cautiously and with a long sharp pole.
The problem: Politicians appear to have learnt nothing from the events of the past three or four years. They continue their currency manipulation with resultant credit booms, speculation and share/commodity bubbles which eventually burst. Essentially they are in denial about the causes of the General Financial Crisis. History is doomed to repeat itself.
“When the people fear the government, there is tyranny—when the government
fears the people, there is liberty.”
- attributed to Thomas Jefferson