Loan Shark

National has adopted the interest-free student loan policy because, in John Key’s words, “we lost the last election“. 

National’s willingness to do another 180-turn when it suits them politically (this time on student loans) further exposes their complete lack of principle but the kicker is in the detail:  If you made voluntary loan repayments of more than $500 on your loan above the automatic repayment, National would repay a further 10% of your voluntary repayment.  If you repaid $1000, you would get $1100 wiped off, a return of 10%, better than if you kept the money in the bank.

Sounds good but who would benefit from such a policy the most?  Why those on high salaries, of course.  If you graduate with a trade qualification and go into initially low paid work you are not going to have the spare dosh to make voluntary repayments on top of the 10% of your gross wages automatically deducted in loan repayments.  It’s going to be much harder for you to spare $500 for a voluntary loan repayment than it’s going to be for a new lawyer or engineer.  It’s the well-paid graduates who would benefit from National’s policy by getting those loan reductions, while most graduates will miss out.

And, so, once again it’s the person with the most wealth who benefits the most from National’s policy, while the ordinary guy is left behind.  How does National do it?  Seems they can’t come up with a single policy that doesn’t mostly help those with the means to help themselves and screw everyday kiwis.

National has budgeted $15 million a year for this, meaning they think there will be $150 million in voluntary repayments each year. Problem is, in 2006 (last year I have numbers for) there were $185 million in voluntary repayments, so National will need more than what they’ve budgeted just to pay for current levels of voluntary repayment.  If voluntary repayments returned to 2004 levels, $210 million, National would be paying out $21 million for an extra $25 million in voluntary repayments.  And remember, this money would have come back eventually through automatic repayments anyway. 

What a waste of money.  It would be far better to spend this money on raising student allowances and making them available to more students, which would help those who can afford tertiary education the least. 

Me-too-Key gives in on student loans

At the last election, National widely criticised Labour’s policy to cut interest on student loans and were cheered on by banks, economists and, of course, kiwiblog. Bill English, National’s then spokesman said:

Labour’s package is nothing more than an extravagant, irresponsible attempt to out-bid National. It also makes an absolute nonsense of Labour’s claim that it couldn’t afford tax cuts for mainstream New Zealanders.

Kiwiblog was even more uproarious declaring the policy a bribe, corrupt, fiscally irresponsible and of course pointing out that it diverted funds that would otherwise be available for a tax cut. Craig Ranapia, often a calmer voice, declared:

I WOULD NOT SUPPORT THIS POLICY IF IT HAD BEEN ANNOUNCED BY BILL ENGLISH INSTEAD OF TREVOR MALLARD! GET IT? HAVE I MADE MYSELF PERFECTLY, CRYSTAL CLEAR?

Well close enough hey Craig, John Key has announced they’ll not only support the interest write-off, they’ll go further and offer bonuses for early repayments - more good money after bad? And why has National changed its mind, you might wonder? Apparently for no other reason than they lost the last election. At this rate, it appears that strongest argument for voting for National is that they’ll do the same as Labour.

Key’s Not Obama, He’s Dubya

I’ve just watched John Key’s State of the Nation speech.  The written version was unimpressive, poor policy and rheotric; the spoken version is worse.

Speaking, Key reminds me of nothing more than a 13 year old in a school play.  Sure he can get his lines out (with plenty of checks of his notes) but he’s clearly acting, playing at the role of statesman. 

Despite National’s transparent attempts to cast him as such, Key is no Barack Obama.  If we must make a superficial comparison with a US politician, I would say that Key is New Zealand’s George W Bush.  An actor, a fraud, with no depth of knowledge of ideas of his own, totally dependent on advisors who see him as a marketing product, not someone applying for an important job.  Key evens quotes Bush’s famous line to the insurgents at the start of the Iraqi Insurgency four years ago, “Bring It On!”, and we know what happened when they did. 

If he were ever to get into office, I fear Key would be the same as Bush was: totally out of his depth, overwhelmed with the pressures of office, unable to cope both with the day-to-day workload and emergencies, a laughingstock on the international stage. 

Watching Key’s National Party audience react to his speech is also educational. 

After he announces that National will provide free skills training for 16 and 17 year olds who leave school, his writers have inserted a pause for applause but none is forthcoming.  When he says that 16 or 17 year olds who don’t take up this offer will lose any benefits they might receive the applause breaks out over the top of him speaking. 

When Key mocks preschool checks to identify early in life children who may have troubles later, they laugh, but when he says National will increase funding for compulsory drug rehabilitation programmes and would include “iwi-based services and other services aimed specifically at Maori or other cultural groups” (this already happen, incidentally) they murmur disagreement.  Fortunately, he’s soon onto lowering the age of criminal responsibility and that draws the biggest applause until he brings up boot camps. 

It’s clear that this really is the same old National: that hates people on benefits and Maori, that is too cheap to fund good programmes (that’s my tax cut you’re spending!), that loves the idea of punishment and authoritarianism.  But that’s not the face of National they’re going to let us see this year; they’re going to be hiding that face behind the smiling mask of Mr Key.

Christchurch Councillor Says Vigilante Killings OK

Christchurch City Councillor Barry Corbett condones the vigilante killing of people who commit minor crimes.

Speaking about the killing of a 16 year-old, who was tagging, by a 50-year old businessman, Corbett said “If I was on the jury, I would let him get away with it, but that is just me”

Can we take it that if Corbett’s son was, for example, driving dangerously Corbett would not object to a member of the public pursuing and killing him?

All the Council has said on the matter is that Corbett doesn’t speak for the Council and it has sympathy for the victim’s family.  No condemnation of Corbett’s comments that go both against the rule of law and common human decency. 

New Christchurch Mayor Bob Parker ought to hang his head in shame for this limp-wristed response to Corbett’s outrageous comments.

Whale’s Questions

WhaleOil is a bottom feeder…but he recently posed nine questions supposedly to shame anyone who supported the government. They’re supposed to be killer (snigger). Despite Whale being NZ blogosphere’s own hagfish, I thought we’d post them here where real people might actually get to see them. I am sure no one will be able to answer these cunningly designed Gordian Knots of conundrums. The nine questions are:

1. Why, after eight years of Labour, are we paying the second-highest interest rates in the developed world?
2. Why, under Labour, is the gap between our wages, and wages in Australia and other parts of the world, getting bigger and bigger?
3. Why, under Labour, do we only get a tax cut in election year, when we really needed it years ago?
4. Why are grocery and petrol prices going through the roof?
5. Why can’t our hardworking kids afford to buy their own house?
6. Why is one in five Kiwi kids leaving school with grossly inadequate literacy and numeracy skills?
7. Why, when Labour claims it aspires to be carbon-neutral, do our greenhouse gas emissions continue to rise at an alarming rate?
8. Why hasn’t the health system improved when billions of extra dollars have been poured into it?
9. Why is violent crime against innocent New Zealanders continuing to soar and why is Labour unable to do anything about it?

Here are some quick answers off the top of my head…I am sure some of you guys can do a lot better.

1. The Reserve Bank says inflationary pressures are coming from a tight labour market, high food prices, high energy prices, weakness in the US dollar and finally “Following several years of strong growth, firms have indicated that capacity remains stretched and that finding both skilled and unskilled staff has become increasingly difficult. These pressures continue to underpin inflation”. So, it’s a combo of things. Global warming, the USA’s ludicrous wars, and the vigorous NZ business sector.

2. By implication Whale is suggesting the government should have intervened to drive wages up. Yay!

3. the Labour-led government has cut taxes. You should read more. A more interesting question is why National never EVER cut corporate taxes in NZ. It took Labour-led governments to achieve this. Why’s that?

4. It’s called capitalism. Oh, and when cartels go unregulated in a market and then a stupid bully beats up on members of the cartel…expect payback.

5. Ummm…they can. I think this is about affordability…but posed so poorly. Dude, try harder.

6. Hmmm…as we’ve previously observed. New Zealand is, according to international surveys (i.e. OECD), churning out some of the smartest, best educated kids in the World. We have to make up ground with disadvantaged kids. That’s where NZ is failing. And looking after the disadvantaged is a real strong National Party selling point.

7. We’re an agricultural nation. Read up.

8. By what measure? New Zealand has a bloody good health-care system. Hey, we could bugger it by privatising it - it’s worked so well overseas hasn’t it!

9. Yeah, well crime genuinely “soared” back in the nineties. Overall crime is not out of control. There has been an increase in violent offending - but it soars like Mt Eden “soars”. It’s a bump. The average length of time people spend in prison has increased and NZ has (shamefully) one of the highest rates of banging up crooks. What more would you expect?

Anyway, you guys have fun providing better answers.

Oh, diddums

Oh, dear. DPF is upset with Idiot/Savant for using the phrase kiwiblog-right.  Davey thinks the term an outrageous slur because I/S uses it to describe the nut-bars who bricked Helen Clark’s electorate office.   Farrar points out he has previously  condemned such actions previously and therefore Idiot’s slur is unfair.  But hang on.  The term “kiwiblog right” relates to the kind of puerile, unintelligent, loud-mouthed, right-wing bigots and jerks that swim the kiwiblog threads. Davey permits - perhaps even encourages - these scumbags to make their outrageous statements on his blog (hey, it’s good for traffic, right?). So, you know, grow up Davey.   The term kiwiblog right has been used on this blog and I think there’s no problem with it.  Farrar has farmed these animals in his corale - it’s only fair they wear his brand. [UPDATE: The NewZ dudes have done a similar piece] 

National’s Victory Plan: Knock Greens and NZ First Out Of Parliament

National’s relationship with the minor parties is full of difficulties.  National is not naturally a party suited to compromise with minor parties  and coalitions, the only time it tried one (in 1996) it failed within two years.  But to get into government under MMP, deals with minor parties are a fact of life.  Let’s look at National’s strategic options for dealing with the New Zealand First and the Greens, two parties which may hold the balance of power after the election.

On the one hand, National could aim to build a relationship with them which may give National the numbers to govern, but neither is clearly sided with National and there is a good chance they would prefer to support a Labour-led government.  National could take that as a risk and continue to try and build a better relationship with them.

On the other hand, if National decides the risk of these parties going with Labour is too great, the logic flips dramatically.  The best course for National now is to attempt to make sure these parties don’t return to Parliament (by ensuring they don’t win 5% or an electorate), in which case their ‘wasted’ votes are effectively divided among the remaining parties and National, as the party with the largest share of the vote, benefits with the most seats, maybe enough to govern with only United and ACT support (you can play with variant results around this on the MMP calculator here). But the risk is that, if those parties do get back into Parliament, National has effectively burnt its bridges with them. 

National seems to have chosen the latter option for dealing with both parties.

Nick Smith, launching the Nat’s ‘Bluegreen Strategy’, said “If we can convince just 1 in 20 of those Green voters that National is a better bet than the Greens, that alone would be enough [to knock the Greens out of Parliament and], all other things being equal, for National to win in 2008″. 

Choosing to stand Bob Clarkson in Tauranga again is a direct affront to Winston Peters, who hates Burqha Bob with a passion.  Rather than put in a weak candidate to guarantee a Peters victory and NZF’s return to Parliament, National is running the strongest candidate the have, the sitting MP.  The second part of the strategy must be to ensure NZF doesn’t reach the 5% threshold.  The best way to do that is for National to take the NZF policies that NZF voters like best and steal them, which appears to be what Key has done with his policies on young offenders.  Lowering the age of criminal responsibility, military-style boot-camps, longer sentences, parenting courses for offenders’ parents, these are straight out of the classic New Zealand First playbook (if anything, NZF has moderated its positions in this area in recent years).  Despite effectively adopting NZF policy, National still won’t vote for NZF MP Ron Mark’s bill to lower the criminal age to 12. 

National is hoping that by playing NZF-heavy, as well as Labour-lite, it will pull enough NZF voters into its camp to stop NZF reaching 5%.  Of course, this strategy (and, possibly, National’s chance to govern) depends on Peters losing Tauranga.  National has gone with their strongest candidate; unfortunately for them, Burqha Bob is as good as it gets. 

My pick is that the Greens will comfortably win 5%.  National will succeed in keeping NZF below 5% nationally but, despite a big campaign, Clarkson will lose to Peters bringing NZF back in Parliament, and in no mood to deal with National.

Helping Problem Youth: The Right Way & The Wrong Way

Both Helen Clark and John Key addressed youth education and offending in their state of the nation speeches.  Let’s look at the similarities and the contrasts:

- Labour will raise the school leaving age to 18, although kids may leave for vocational training earlier, and the successful Modern Apprenticeships programme will be incorporated into High Schools so it is possible to get trade training at the same time as a broader education.  Labour is targeting all the 29% of people who leave school before 18 and the policy is explicitly linked with the need to build a more educated workforce to enhance productivity growth.

- National will take benefits away from any 16 and 17 year olds who are not in school or training.  The measure is punitive and narrow; it is not an effort to raise the level of education of young New Zealanders in general but rather to punish at most a few thousand people Key considers free-loaders (although most of these people have exceptional situations that may prevent study).

- National has said it will adopt a range of policies targeted at youth offenders that are already underway, including Government legislation currently before Parliament to increase the Youth Court’s power to sentence offenders to residential facilities (youth prisons) from a maximum of three months to six months.   Labour already has these policies in place and working.

- Labour will introduce, as part of the B4 School programme coming into effect next month, a programme to identify young children with conduct disorder and social problems.  It has long been known that the best time to intervene to change life outcomes is early in life (‘Give me the boy until the age of seven and I’ll give you the man’ the Jesuits used to say); intervening with problem children and their parents when the kids are five costs $4000 each (for an estimated 3000 kids a year) and has a success rate of 80%.

- National seems to think being the ambulance at the bottom of the cliff is smarter. Key wants to send problem teens off to boot camp.  He sites successful programmes run by the Ministry of Social Development at army camps.  What he missed, and the organisers of these programmes have been quick to point out, is that these programmes are voluntary and that’s why they work; they are not set up to take seriously violent and troubled youths who are there involuntarily.  Turns out Key hasn’t even asked the Army if they could handle running boot camps for violent teens. Key wants mandatory parenting courses for teen offenders.  Childhood experts are quick to point out that it’s too late: even if you can change parents after so many years, they are unlikely to have much impact on their children, many of whom are not even living at home anymore.  Key’s programme costs $100,000 a youth, and there is no evidence it will succeed.

While Labour is looking at the root causes and the big picture, National is only looking at the symptoms and can only offer out-dated answers. 

[I like Jordan Carter's billboard on National's Youth Crime Policy, here]

Violent Youth Offending Down, Peaked Last Time National Was In Power

“Apprehensions for youth offenders as a whole is declining” Principal Youth Court Judge Andrew Becroft said.  But wait, isn’t John Key telling us we’re being assaulted by a growing wave of violent youth criminals?

Well, an hour and a dozen stats pages later, it looks like its the judge not the moneytrader who has it right:

 

Violent offending by youths has not been increasing, it peaked in the mid-1990s (can anyone say ‘record youth unemployment under National?’).  As a percentage of all violent crime convictions, the 10-19 age group continues to decline.  Turns out its the 55-90 age group who are the bigger culprits these days.

After Brash’s racist Orewa speech the media was all abuzz about special privileges for Maori until they asked National for some actual examples, turns out they had none and they were exposed as the hollow men they are.  Looks like they’ve done it again.

‘Send The Buggers Off To The Army’ - Key

Just quietly, I was braced for John Key to completely blow my expectations and deliver something spectacular in his speech today.  Certainly, National had been talking it up enough that there was a possibility he really did have something special to pull out of the hat.

But it was not to be.

Key’s speech opens with a tasteless reference to Sir Edmund Hillary’s death, followed by a vague, fact-free ramble about the economy (obviously a last minute assertion following the panic-mongers were talking up the chances of a world recession last week).

Eventually, Key gets into the meat of the speech: if you’re 16 or 17 and not in school or work, you must go into tertiary training or you won’t be permitted to receive a benefit (unless special circumstances mean you can’t study).  There are something less than 3400 people in that category, and to most of them special circumstances, such as being mentally or physically disabled, heavily pregnant or caring for a young child, will apply.

Next, Key obviously thought making some political capital off the recent spate of killings would be a good idea (as shown here, the number of killings in New Zealand is actually falling).  So, it’s a get tough on young offenders message.  Key reckons there are a 1000 hardcore problem youths out there and he has a $100,000,000 solution for them (yep, that’s right, $100,000 each with no guarantee of success): the age of criminal responsibility will be lowered for all crimes (it’s already 12 for serious violent crimes, Key will make it 12 for all crimes), so we can give up on these kids even younger and chuck them in prison to live with older, more hardened criminals. 

Sounding like a 1950s Catholic nun, Key tells us that what problem children need is discipline and restriction, army-boot camp style.  Because there’s nothing like punishment from the authorities for making someone who feels rejected by society realise they can make a positive contribution.

Then there’s this weird line: “The problem I am talking about today is the group of serious persistent offenders.  In the view of Principal Youth Court Judge Andrew Becroft, this is a group of about 1,000 young people.  We don’t need a pre-school check to work out who they are.  We already know their names.” – um, John the point of pre-school checks, which the Government is introducing, is to identify children whose life circumstances are likely to lead to social and criminal problems later in life, so that we can intervene to stop that happening.  We don’t know that next generation of troubled youths’ names yet, and it will be too late to turn their lives around once they are on your list of 1,000.Here’s what an expert on troubled children Dr John Church has to say on when to confront the problem:courses for 3,000 problem children aged five] cost about $4000 for each child involved, and have a success rate of about 80 per cent.In contrast, leaving intervention until a child was aged 12 or 13 would raise the cost to $16,000 to $17,000 and cut the success rate to below 20 per cent.

By the time they get to jail, the success rate is close to zero and the annual cost is well over $90,000,”

Rather than proposing spending $100,000 on each persistent youth offender for out-dated, authoritarian programs that don’t work, Key should be supporting the Government in its successful, efficient early intervention program.

There is a problem with a small number of troubled youths in our society.  It is a tragedy to see their potential wasted and for them to inflict pain on others.  But Key offers us no solutions.   

[The Standard looks at the speech from a strategic political viewpoint, and they aren't impressed]