Renting turned out to be as dangerous for production engineers as for families.
The putting into financial play in the late 1980s of the nation’s castings, forgings and machining engineers had the effect of stripping out their ownership of their own sites and thus leaving them prey to the real estate sector and its exorbitant demands.
New Zealand’s short lease regime and even shorter rent review periods effectively threw the nation’s medium to heavy production engineers into the hands of the non-productive property sector.
This bitter harvest coincided with the disappearance from New Zealand of its merchant banking capability. There is no merchant finance capability now in the accepted risk participation-ownership sense.
The fact that the engineers had been stripped of their site ownership meant that they had to turn now to the Australian commercial banks with their reluctance to lend on anything that was not backed by clear land title.
This did not become immediately obvious, however, partly because the tariff protection abolition that accompanied this boom-bust era took time to dismantle.
There was some good news too from Europe.
The events surrounding the fall of the Berlin Wall meant that Eastern Europe was identified as an important new market. Backed by the government, notably in the form of assistance from the New Zealand embassy in Moscow several engineering bi lateral trade deals were exploited within the old iron curtain.
Immediately after this there began the intensive trade with China.
This now allowed production engineers to start abandoning their sites, which they now did not own anyway, and focus on their design and brand work in New Zealand while farming out their production to Asia.
It was now though as the end of import restrictions began to finally melt away under accelerating globalisation that the remaining production engineers on leases began to feel the chill winds of change.
For the long established production engineers, the ones that had gone through the 80s property and credit bubble, and in the process had lost title to their yards and premises what had once been asset now became a big liability
Heavy engineers were historically positioned near to rail and ports and thus their now leased sites became attractive to the premium residential and leisure sector.
Which is what the property rotators had gambled on in the first place.
Another problem was and is that the once-forecast inland container depots never materialised in sufficient bulk to take the pressure off port land, the land that the engineers now leased and which became increasingly prone to lease rent hikes.
The engineer now became the industrial version of a fashionable restaurant. If they did badly- then they did badly. Should they do well- then their landlord was in for their share of the bounty, knowing too that if the tenant quit that there would be plenty of service sector takers for the site.
The point being that the speculators apportioned no value to the gantries, rolling beds, and other such fixtures other than scrap value
It is in borrowing though that the leased land problem is most evident for engineers. They cannot borrow on improved value. Machine tools of any value will be leased anyway, probably from UDC which, incidentally this year was sold to Chinese interests.
The tenancy position is not so critical for assemblers and process engineers who sell finished goods into retail with its accelerated turnover and thus returns based on measurable cash flow from consumers.
But for the heavy project engineering sector with its ever-extending payment times and attendant payment uncertainties the failure to possess the title to their own premises increasingly proved fatal.
Some lease booby trap fuses were longer than others. But in the end the results were the same. The sites leased out on a service sector rent level could no longer sustain their original purpose of production.
A curious difference between the New World and the Old World is that leasing and renting has never been accepted as an economic proposition in the new world.
We can see now that this applies as much to the industrial sector as it does to the residential sector.
This systematic undercutting of the nation’s productive capacity was widely applauded at the time by management theoreticians whose slogan was that production engineers among others should “stick to their knitting.”
In the event, and as we can now see, the loss of title to their own works meant that the engineers now became involved instead in the complex world of leases.
Especially and willy-nilly they found themselves in the sphere of the property management company with its attendant contract that ensures that whichever side wins or loses the possessor of the contract always comes out the winner.
Better known today as an existential author and public ethicist John Wareham (above) originally burst upon the national commercial consciousness with a series of proclamations and books that explored the changing nature of New Zealand management techniques and attitudes that began to take shape in the later 1960s. He expanded his management consultancy into Australia and then to the United States. The onetime New York resident has returned to live in Wellington.
Five questions for John Wareham...
You once claimed that the unsuitability of a wife for an achieving careerist would become grounds for divorce. How do you see this statement in the light of today?Times changed. The subsequent Yuppie generations self-selected on the basis of earning ability, and then married, if at all, after living together and thus jointly accumulating their wealth. Since I originally made that statement familial capital formation has become shared.
John Maynard Keynes believed that the transfer of enterprise from industrial families to shareholders at large would engender a more compassionate era. He believed that the non-family professional managers would serve the wider community instead of just the whims and wishes of the ruling dynasty.On this point, Keynes failed to foresee the future. Sadly for us all.
In New Zealand especially there is this constant call from politicians for more people to become entrepreneurs. Universities have courses in it. Your opinion?It is difficult to distil entrepreneurialism to a formula. One can teach marketing techniques but the key to being an entrepreneur is the willingness to take a risk. The bigger the risk,the bigger the potential reward. Figuring out what one might do is not the same as having the courage to do it, and courage can’t be taught—and for over-anxious wannabe entrepreneurs, judgment goes out the window when risk enters the door.
In one seminar we attended you claimed that the truly successful entrepreneurs were the ones who loved the business that they were in – that this passion in fact counted for more than material success?Still true!
Can you now as the founder of Oceania’s first management selection organisation give us five tips on likely applicants who should NOT be hired for anything at all?Candidates who:
Demonstrate hostility in interview situations;
Refuse to conform to standard hiring procedures;
Clam up or steer the conversation away from themselves
Cannot explain resume gaps—or who have rehearsed, glib answers to such queries;
Lie in their resumes—or in during an interview;
Have an ongoing history of downward earning and being “outplaced”;
Are smooth-talking job hoppers
What a Difference three years has made to the Media Class
Out the book came on its triennial pre-election rotation shaming mission this time of the military. Broadcasters adopted solemn visages to hype the soufflé. Print columnists responded piously in their customary and secondary Pavlovian pick-up role.
The public responded. With indifference. The media class had flailed away at the usual levers. They were no longer connected.
Less than a year has passed since the two New Zealand newspaper chains first lodged their merger application with the Commerce Commission. Yet industrially it is an epoch ago. It is as if during these 11 months that the age sail had given way to steam which in turn had given way to internal combustion. Consider what has happened during this short space of time:-
President Donald Trump communicates directly with New Zealanders via his Twitter account. No need to buy a newspaper, or tap into a broadcasting channel. The President of the United States will communicate with anyone, anywhere with a Twitter account at the same time that he does with the rest of the world.
Two universities, repositories of immense content, have similarly moved into the on line news business
Chorus the main provider of long haul communications cables also moves into the online business, backing up the considerable existing presence in this sector of Telecom-Spark , its original parent.
General Motors and Vodafone entered the online general news business here.
What a difference three years makes. What a difference 11 months makes.
The free model meanwhile scythes at ever accelerating speed through the communications sector, notably books and newspapers.
In the sector at large there remains though some curious ironies. For example this week Spark’s Xtra subscribers found that accessing what they were paying for, their email service, was labyrinthinely complex, if possible at all.
While access to the Spark free news service was instantaneous.
| From The MSCNewsWire reporters' desk || Wednesday 5 April 2017 |||
Ground floor opening for the state to back IT manufacturing lost. Progeni’s Perce Harpham explains what went wrong...
During the 1980s Australasia’s version of Silicon Valley was New Zealand’s Hutt Valley. Here, a coalition of public and private enterprises had anticipated the screen graphic presentation techniques that would later become standard fixtures. At the forefront of these developers was Progeni led by Perce Harpham (above). Progeni had developed its desk top computer for the global marketplace. It needed just one thing which was a local user base in education. But Apple, whose Steve Wozniak was a constant presence in the Hutt Valley of that era, was also knocking on the class-room door...........Five questions now for Perce Harpham....
As you look now at the immense scattering of public funds in the general direction of encouraging technological innovation, you must feel increasingly disappointed at the failure of the government to encourage your educational application desk top computer, leaving the field open to Apple among others?
The development of the Poly computer system was disappointing on many fronts. The idea for a special purpose computer was conceived by two gifted lecturers in Wellington Polytech. It was accepted by the Education Department. The Government's Development Finance Corporation was charged with doing the sort of job that NASA does with space travel - namely bringing together New Zealand resources to make it happen. Just for once it appeared that NZ was going to do something right in the technology field by taking a problem which we had here and developing a solution for the world market.
The Development Finance Corporation invited us to form a joint venture with them to do the job. The idea was that the Joint Venture would develop the systems software and the hardware, the Education Department would develop the courses and use them in NZ while the JV would make the computers and market them with the courses overseas. DFC said they had cast iron arrangements with Government to buy 1000 machines per year for five years if they met the practical requirements of the Department.
My company, Progeni, then provided highly capable professionals to develop the system including all sorts of innovations, some 30 companies supplied parts and manufactured circuit boards, and the specially designed the moulded cases and the like. Some 60 teachers gave up their Christmas holidays to develop demonstration courses for mathematics, music and all sorts of things where there was a need. We made some 70 machines which were trialled in class rooms. Massey University evaluated the results. They were highly successful and more than met the conditions set down by the Department. The Government then welshed on the deal.
Warren Cooper later told me that he and his colleagues in the cabinet had decided that, and here I quote, " there was no point in spending Government money so that teachers could do even less work".
We bought out DFCs interest in the Joint Venture and tried to carry on. A number of schools then raised money and bought machines. I have been told that another cabinet minister had an investment in the Apple agency in NZ. Apple then was allowed to dump, and I use the word in its formal legal sense, its computers in NZ at about one quarter of their retail price. They targeted precisely our market and destroyed it for us.
We went to China and sold a few machines then built a new model handling Chinese characters. We were on the verge of some major sales when the Tiananmen Square incidents occurred and all the bankers suddenly thought anything to do with China was valueless. Our bank, the Bank of New Zealand, then twice had to be rescued from bankruptcy by the Government. We were the collateral damage. Almost a year after the receivers were appointed we had a major order from the Agricultural Bank of China. It had been delayed by Tiananmen and the company had been destroyed. But I managed to deliver part of the order from stocks that had been stored in China and purchased back from the universities we had given them to. But we were already dead.
Had the Government honoured its commitments New Zealand would have been a world leader in computer-based learning.
To what extent did the death of your chief technology officer Jean Claude de Verrier in the same Chicago DC10 disaster that took the life of Roger Estridge, point man for IBM’s pc development, harm the future of the Progeni desk top development?
Jean Claude de Verrier's (pictured below) death was a huge blow. It did not affect the development of the Poly computers. But it set back our US venture dramatically. Nonetheless it was going well before the receivers sold it to the management for a pittance. It has gone on to prosper as Progeni Inc with headquarters in Dallas. All of the people we transferred to the US who have not retired are still with it. See its website.
After your bid to persuade the Department of Education here to buy the Progeni desk-top, you turned to China. Were you worried at the time and subsequently about (a) copying, and (b) getting paid?
I can only add that one is always vulnerable to copying and you rely on staying ahead of the game so that your new innovations make the copies obsolete. There was never a problem about getting paid. When we went into receivership it was claimed in the press that it was because we had not been paid from China. This was completely untrue.
You pioneered in New Zealand the independent software development house, handling major governmental contracts along the way. How do you view nowadays public systems development and implementation?
I view Government handling of their computer developments as an unmitigated disaster. We formed a Joint venture with a US company to deliver the software for the Wanganui Computer System. We delivered it on time at the quoted fixed price, exceeded the specification, made a profit and paid tax on it. It lasted for 30 years.
In the meantime the Government let a contract to replace our law enforcement system. No NZ owned company made it onto the short list. It was let to IBM. The delivery was supposed to take about two years. After five years and $100,000,000 it was abandoned.
Many millions were spent having an American company develop a health system with no NZ input and it was then abandoned. I remember talking to the project manager nine months after they started. He had only just found out that we did not have the equivalent of the US Sprint telephone system in NZ and was having to redesign the communication system.
More recently Customs went to tender with a contract which essentially specifically excluded NZ companies. Companies like Orion have had to make major sales overseas before gaining any sales in NZ for their hospital systems. The payroll system let to an Australian company was a disaster. The IRD system, over $1,000,000, is being developed by an overseas company.
We are supposedly going to develop a high technology economy. Yeah right!
It is said within the IT industry that pioneers end up with arrows in their back. Is there anything you might have done differently, especially in regard to your international development which many, even at the time, regarded as audacious?
I would not chase Government work unless I was satisfied that we had a level playing field uncontaminated by a cringing belief that our New Zealand capabilities are necessarily inferior.
I would first work on local and overseas companies as well as overseas governments and state governments. The latter, like the NZ Government, want to know if you have delivered similar systems elsewhere but will look at your proposal in an unbiased fashion and the experience of your proposed project team. If this includes people (possibly one or two consultants) who have had the experience you lack as a company but are satisfied that your management is competent then you are in with a chance.
He looks like the star of a television series set in the 1950s about British country doctors or family solicitors of those solid and dependable times. But former French premier Francois Fillon considered by the English-speaking world to be a shoo-in for his country’s presidency is now looking anything but a winner.
In recent weeks the Mr Clean of europolitics has found himself be-spattered in every variety of calumny and remarkable even for a country renowned for its political spoils system.
The hapless Mr Fillon is looking less and less like the fulcrum around which will rally the centrist forces in the event of a first round win by the National Front’s Marine Le Pen.
At the cusp of the 1960s/1970s France was the focus of New Zealand’s global trade interest for the way in which it was perceived to be throwing a spanner into the primary produce works as Britain made its transition into the Common Market, as the EU was then described.
Yet in a bizarre about turn France has now become as important to New Zealand industrially as Britain was in those days.
This is artfully concealed from public view though by a politico-media determination to keep the trade spotlight on Asia and the Middle East
Here though are just some of the French companies that dominate their sectors in New Zealand:- ‘
* Veolia Water and commuter transport in Wellington and Auckland. Controls Transdev * Axa Finance – (controls AMP) * Pernod Ricard Owns Montana * Lafarge Holcim Cement * Schneider Electrical manufacturer, formerly PDL * Accor Hotelier * Air Liquide Industrial n gases * Allflex Livestock management applications * Danone Dairy * Parmalat Dairy * Synlait Dairy * Alcatel Information technology * Thomson Air traffic control * Alstom Transport * Rexel Office supplies
This unacknowledged state of affairs took on a humorous form when one of the New Zealand government start-up technology incentive funds invested in what appeared to be a local computer games producer only to find out that it was in fact controlled by Vincent Bollore.
He is known as the Breton Raider, and who from his gigantic holdings in transport and commodities in Africa has devolved into the leisure-entertainment sector.
The officially encouraged focus on the East contains a romantic Prester John–like flavour in refusing to acknowledge how hard it is for anyone but the very biggest traders to actually get paid from anyone in these regions.
It also shrouds the mercantile dependence on a country such as France. This is demonstrated by a French trade deficit of $845 million in 2014. In France’s favour.
Back now to Mr Fillon who until a few weeks ago was considered the favourite for the Elysees and thus the man to usher in New Zealand’s EU trade agreement.
His role even as the rallying point as the second round coalition leader in the French presidential double is now being questioned.
The favourites now are the National Front’s Marine Le Pen head-to-head with the former Socialist Party economics minister Emmanuel Macron and his own personal party France on the Move.
For Mr Fillon trouble does not travel alone. Not only is he being charged with putting his family on his parliamentary payroll, and for influence peddling, which is all pretty much part of French political life anyway.
In the unkindest cut of all he is also being accused of receiving his fine-cut English style suits as gifts from wealthy benefactors.
Five questions for ex United Nations Security Council President Terence O’Brien.
Few practitioners from any nation have enjoyed quite such an extended career at the heart of the global firmament as British-born diplomat Terence O’Brien (above). He was president of the Security Council of United Nations during the Balkans conflict. He was one of the principal access negotiators on behalf of New Zealand when Britain originally entered the European Common Market. He has occupied posts in London, Brussels, Bangkok and Geneva. He was the founding director of the Institute of Strategic Studies.
You have been an outspoken opponent of mixing trade with foreign affairs?
This is not strictly accurate. I take issue rather with the jargon that “all New Zealand foreign policy is trade” which is a holdover from earlier times and reflected today in a sense promoted by some New Zealand leaders, that NZ’s success and place in the world is to be judged primarily by the number of Free Trade Agreements that it is able to secure.
NZ’s modern experience especially in respect to emergent Asia proves emphatically that successful trade arrangements depend firstly and vitally upon sound political and diplomatic relationships (China is a prime but by no means solitary example). NZ’s accomplishments in Asia and indeed elsewhere rely in other words, upon earned trust with other governments. Fostering that trust is a political/diplomatic responsibility.
Predictable trade relationships require a great deal more than nimble private sector commercial skills- although those are indispensable of course to overall success and the New Zealand private sector plus NZ primary producer groups have been notably effective in this regard.
To what extent do you view the recent NZ sponsorship of the UN Israel censure as a development of this blend?
There may have been in the minds of some on the NZ side, the thought that sponsorship might earn credits in some Gulf States where NZ seeks to formalise free trade arrangements; but around the UNSC table there is genuine concern about the danger for the future of ‘two state solution’ to the Israel/Palestine conflict ,that has been the long established diplomatic basis for eventual peace. The present Israeli government appears openly to resile from this formula as it continues resolutely to expand Jewish settlements on the West Bank, a practice deplored by the UN Security Council. From the moment it gained a place on the 2015-16 UNSC NZ committed itself to contributing to the search for progress on this key issue. Co-sponsorship of the eventual UNSC resolution which calls as well for Palestinians to desist from provocation and terrorism, was the logical consequence.
Looking back on your days as a dairy sector negotiator during Britain’s entry into the Common Market, how do you view Brexit now in terms of NZ diplomacy and trade?
From the perspective of a small, distant but companionable partner of Europe, Brexit appears to be a mistake. It comes too at a time when conservative populism is on the rise within Europe with the emergence of right wing nationalist political groups in several countries. Twentieth century experiences of European mistakes and miscalculations and their devastating global consequences, not once but twice, are not to be overlooked.
British entry into Europe was a taxing experience for NZ. The deals struck for safeguarding NZ trade interests represented a stay of execution rather than reprieve for this country . Within relatively short periods of negotiated transition the New Zealand farm economy was obliged to diversify production and markets. That process drove foreign policy extending NZ political and diplomatic interests to a wide range of new partners (in the Middle East, Communist Europe, Latin America and, most notably Asia) . It consolidated NZ as a genuine world trader with global interests. Global interests are inextricably bound up with global responsibilities even for small countries, and require contributions to global wellbeing and stability.
The process deepened NZ support for international rules based behaviour particularly in trade but also in directly related areas such as peace and security, freedom for transport and navigation, responsible behaviour in global environmental and resource protection and so forth. Because of the very nature of its own being the European Union (EU) has been a notable champion of an international rules based system. But the fact of BREXIT places a question mark over how influential a collective European voice will now be in the future. At a time when American commitment to global rules is questionable under a new inexperienced President Trump, the need for sustained collective European support for the system has never been greater. The foreseeable future suggests that New Zealand will crucially need the courage of its convictions.
How do you feel about the Helen Clark bid to be the UN Secretary General especially in regard to her role as an officer of the UN at the time?
The selection process for a new UN Secretary General in 2016 sought to break new ground - which is always difficult in the UN. Formal candidatures backed by governments and involving public job interviews were decreed for the first time in 70 years. Hitherto candidatures had been exclusively personal affairs and selection decided behind tightly held UN Security Council doors where the votes of the five permanent Council members (US, UK, France, Russia and China) were decisive. This time a new approach was defined in the interests of greater transparency and democracy in the selection process. It is stretching things somewhat to suggest those goals were achieved.
There was a general sentiment beforehand that the new appointee should be from Eastern Europe (which has never supplied a UN Secretary General ) and also be female (which would be a first). In the event neither aspiration prevailed and the choice, of a Portuguese male, was once again taken behind closed doors at the UNSC.
Helen Clark was a creditable candidate and the NZ government campaigned for her, but her success depended first and foremost upon her own efforts. She came as a candidate from within the ranks of the UN itself, but this is not without precedent (Kofi Annan one the most effective SGs, was a UN Secretariat employee). As head of the UN’s largest aid institution she was well known across a very wide number of UN member countries ( especially developing countries).The reasons for her lack of success will probably never be known in full. Her relatively poor showing in the straw polling of UN member countries before the final appointment, was an undeniable disappointment. The most that can be said is that she was a serious contender; and NZ can take some consolation from that.
What are your views on Russia and NZ’s participation in the US-EU trade embargo?
With Russia and NATO we are reaping what was sown. At the end of the Cold War there was an opportunity for the Americans and Europeans to consolidate a cooperative inclusive (of Russia) security system for a post CW Europe. The Soviet led Warsaw Pact subsided into oblivion which is what military alliances historically do when conflicts end, and/or the reason for their existence disappears. NATO in direct contrast did not. It was enlarged with new members, new bases installed and its boundaries extended into Russia’s borderlands - which for the US anyway potentially included Ukraine. But who was the adversary? An enfeebled Russia could do nothing but (as George Kennan amongst others warned) one could not rule out economic recovery by Russia and new leadership that objected to NATO expansion (which included into the affairs of the Middle East) and would push back. Enter Mr Putin, and so it has come to pass. His preemptive seizure of Crimea (where the Russian fleet has had a base for two centuries or so) is contrary to the international rule of law - but hardly surprising in the wake of western foolhardiness.
NZ should sustain a suitably detached policy position over present NATO-Russia. We do not have a dog in the fight. Russia does not threaten the US although Putin clearly intends that Russia be assertive and taken seriously internationally. Russian interference in the US electoral process may or may not have occurred. If it is proven Russians would presumably point to equivalent American policies in the name of “spreading democracy” in Russia ,its satellites, and including Ukraine. They are, on both sides, ‘pots calling kettles black’
| From the MSCNewsWire reporters' desk | Monay 27 March 2017 |||
Statesman told his family to journey as far away from Germany as possible.
The New Zealand-born grandson of Ludwig Haas leader of the German Democratic Party in the 1920s and often described as the only politician who could have stopped World War 2 is assisting in a major biography of his ancestor.
The biography sponsored by the Commission for the History of Parliament and Political Parties is being published by Droste Verlag of Dusseldorf, a general interest publishing house.
Ludwig Haas (pictured above) died in 1930 while organising a broad based coalition to counter what he perceived would become the burgeoning and overwhelming rise of the National Socialists.
The politician’s early death was ascribed to the ravages of the front during the First World War in which he was decorated with the Iron Cross
With his last breath the dying politician instructed his son Karl “to put as much distance” as the son could “between you and Germany.”
Karl Haas took his father’s instructions literally, eventually arriving in New Zealand shortly before the outbreak of World War 2.
He began his career working in Auckland for wool brokers E. Lichtenstein. After finding his feet in his new country he then acquired a farm near Pahiatua in New Zealand’s North Island.
It was there, in this remote location, that the Haas family remained with Tony Haas, the grandson, being born toward the end of World War 2.
Tony Haas, (pictured, below) Ludwig’s grandson, is widely known in New Zealand for his work with Pacific Island communities and their economies.
In recent years has become acknowledged as one of Oceania’s public intellectuals. Two years ago Mr Haas’ own autobiography was published entitled Being Palangi: My Pacific Journey.
At large in the northern hemisphere Brent Marris of Waihopai Valley’s Marisco Vineyards answers Five Questions......
Brent Marris and his family have been part of Marlborough vineyards and wine making since the inception of the terroir and its associated appellation. In recent years the family has focused on developing in the Waihopai Valley its Marisco Vineyards and its marques The Ned & The Kings Series. We caught up with Brent Marris (pictured) in Europe........
What has been the impact of Brexit on your business?
The Brexit effect is huge and is due to the weak pound. Because we trade in UK pounds it has impacted on bottom line. A movement of approx 20%. Our fingers our crossed that it bounces back. Or, prices will have to go up, we fear. .
What are your hopes and/or fears for the in-progress NZ-EU trade agreement?
With the NZ-EU trade agreement it is simply that the closer we can get to reducing tariffs and other such charges the better. The more open freedom to do trade, the better from our point of view.
You have just been notably visible on the trade scene in London, and now we have found you at Prowein in Dusseldorf. How valuable are these trade fairs to New Zealand exporters and as a long time exhibitor can you spell out some dos and don’ts for the benefit of NZ industry at large?
Prowein has proven to be excellent from our point of view especially as both more UK and US trade buyers are attending. If you can afford your own exhibition stand then that of course is the best option. But starting out on a New Zealand shared stand is a good beginning. A tip? Having enough meeting spaces on your stand is vital because it offers more chance of serious discussions, the ones with worthwhile results. This is imperative, incidentally, in our experience in terms of selling in the UK and in the EU.
A problem in your sector has been in actually getting paid by importers. What measures do you take to ensure payment?
Payments have not been an issue for us simply because we deal with large reputable buyers in the UK. In the EU zone we have own warehouse space and staff so everyone we deal with we know personally. Communication is the key here, hardly surprisingly.
You produce Sauvignon Blanc, Chardonnay, Pinot Noir, and Pinot Gris. Define for us current international tastes and preferences?
Consumers happily enough still love our Sauvignon Blanc while Pinot Gris, Rosé and Pinot Noir are gaining traction. In regard to preferences it is our experience that people love stories and if you can attach a good story to your wine brand then you are ahead. In general, we find our brands are seen as good, honest wine brands of quality that have been around for a good length of time therefore are reliable.
|| From the MSCNewsWire reporters' desk | Wednesday 22 March 2017 |||
Five Questions for Dr Don Brash..............................
Nobody today in so many different roles and for quite so long has stood at the centre of public life so enduringly as Don Brash. Economist, businessman, banker, politician, the former Governor of the Reserve Bank and leader of the National Party has defied typecasting. At one and the same time severe yet extravagant, austere yet colourful, scholarly yet populist, he has contrived always to reconfigure himself around the times. Now he has stridently intervened in institutionally-fuelled separatism. Shrouded in a protective veneer of high-minded fashionable purpose that makes ordinary people fearful to question it, Dr Brash vehemently, unequivocally declares the voguish syndrome as ultimately destined to tear the nation apart......
You are often considered to be at heart primarily concerned with matters economic and their corresponding data. Yet here you are now immersing yourself in what many might consider a socio-ethical issue?
Yes, most of my career has been about monetary policy, banking, and economic issues more generally. But my interest in economics has always been because of my interest in the well-being of society more generally. I have long felt, for example, that it will be difficult or impossible to maintain a broadly egalitarian society in New Zealand – the kind of society in which I was brought up – if average living standards fall too far below those in Australia because of the ease with which skilled New Zealanders can cross the Tasman for very much higher incomes in Sydney or Melbourne.
If we want the kind of healthcare which those in advanced developed countries take for granted, we have to have the living standards to support that healthcare. A few years ago, there was a big debate about whether Pharmac should subsidize the provision of Herceptin for the treatment of certain kinds of breast cancer, and it was noted that Australia did so. The fact of the matter was that at that time virtually all the countries which subsidized access to Herceptin had higher living standards than New Zealand did; those which did not provide a subsidy, had lower living standards – we were right on the cusp. For me, interest in economics has always been about the implications of economic policy for the well-being of society.
Hence, I was strongly opposed to inflation in part at least because of the totally capricious effects which inflation has on wealth distribution – those who save in fixed interest instruments being thoroughly gutted by inflation, while those who borrow heavily to invest in, say, property, make huge and totally untaxed gains with little or no effort. That has always seemed to me to be grossly unjust.
Will the Hobson’s Pledge Movement become a force in the pending general election?I certainly hope so. I find it very depressing that the National Party has moved such a long way from its roots in this policy area. In 2002, Bill English gave a lengthy and very thoughtful speech, demonstrating clearly that Maori chiefs had ceded sovereignty in signing the Treaty and arguing that the only way for a peaceful future for New Zealand was a “single standard of citizenship for all”.
In May 2003, he pledged that a future National Government would scrap separate Maori electorates, as the Royal Commission on the Electoral System had recommended in the late eighties if MMP were adopted. I made similar commitments when I was Leader of the National Party, as did John Key in the election campaign of 2008. And yet we’ve seen the National-led Government retreat a very long way from that position.
I applaud the fact that the current Government has accelerated the resolution of historical grievances, but utterly deplore the fact that too often resolution has involved not just financial redress but also “co-governance”.
We see the proposed amendment to the RMA requiring all local councils to invite their local tribes into so-called “iwi participation agreements”, involving co-governance on a grand scale. We saw the legislation establishing the Auckland super-city requiring an Independent Maori Statutory Board, with the Auckland Council giving members of that unelected Board voting rights on most Auckland Council committees.
We see the Government negotiating behind closed doors with the so-called Iwi Leaders Group to give tribes some form of special influence over the allocation of water, despite pretending to believe that “nobody owns water”. We see a proposal to make half the members of the Hauraki Gulf Forum tribal appointees.
The myth that the Treaty of Waitangi created some kind of “partnership” between Maori on the one hand (or more accurately, those who can claim at least one Maori ancestor, always now along with ancestors of other ethnicities) and the rest of us on the other is increasingly accepted as Holy Writ, subscribing to which is becoming essential for many positions in the public sector.
So I’m very much hoping that Hobson’s Pledge can help to substantially reverse this highly undemocratic drift after the next election.
You say that the National government is “pandering” to “separatist demands.” Which of these demands do you consider the most dangerous?
Where do I start? I’ve just listed some of the specific policies which are totally inconsistent with any reasonable definition of democracy. Most of those specific policies stem from the underlying myth that the Treaty established some kind of “partnership” between those with a Maori ancestor and those of us without, as I’ve just mentioned. But as David Lange said in the Bruce Jesson Memorial Lecture in 2000, “the Court of Appeal once, absurdly, described [the Treaty] as a partnership between races, but it obviously is not. The Treaty itself contains no principles which can usefully guide government or courts.... To go further than that is to acknowledge the existence of undemocratic forms of rights, entitlements, or sovereignty.”
All the specific examples I gave in answer to the previous question stem from the underlying nonsense that there are two (and only two!) distinct groups of New Zealanders, those with preferential constitutional rights and those without them. This is leading New Zealand to disaster with a whole generation of part-Maori believing that they really do have superior constitutional rights to the rest of us.
To what degree would you ascribe this separatist development agitation as being primarily a project of the political class from whatever background?
Certainly, I think what you call the “political class” is the main driver of this separatist agitation, together with arguably most of the educational establishment, where adherence to so-called “Treaty principles” seems to be an absolute prerequisite for appointment to any teaching or leadership position.
The same is true in the public healthcare sector. But there is plenty of evidence that large numbers of the “general public” do not support the separatist agenda but are literally cowed into silence on the issue.
I regularly get people sidle up to me in the street and, after looking furtively up and down the street lest they are recognized by friends or acquaintances, tell me that they strongly agree with me. One university professor did this recently, but swore me not to mention his name or university department. And some of these people are Maori.
Of course, Hobson’s Pledge has two official spokespeople, one of whom is me and the other is Casey Costello, a woman of Ngapuhi and Anglo-Irish ancestry. But two of our very strongest supporters (though not members of our council) are Maori – one a prominent member of the Ngapuhi tribe and the other Ngati Porou.
The latter was a member of our council when we first established Hobson’s Pledge but, because he is closely associated with a political party, withdrew lest his membership of Hobson’s Pledge raise a question about whether we are a front for the political party he is closely associated with.
He resents the separatist agenda because he believes strongly that it is patronizing, implying that Maori aren’t quite good enough to make it successfully without these constitutional preferences.
Bearing in mind your underpinning career in banking, economics and looking now at the broader picture: where is the country now in your view in terms of nuts and bolts things such as balance of payments and foreign debt?
Compared with some other countries, we are in a good spot, with the economy growing, unemployment fairly low and government debt modest relative to GDP. Our banking sector is in reasonable shape. Even the extent of the country’s (public and private sector) total net external indebtedness is somewhat better than it was a decade ago, though still high by developed country standards.
But there are significant problems just below the surface of that apparently rosy picture. Yes, the economy is growing, but that is largely because the number of people in the workforce is growing strongly because of a high level of net immigration: productivity, and thus per capita income, is growing very slowly indeed, and the Government’s initial objective of closing the income gap with Australia by 2025 is not only not going to be achieved, the gap hasn’t reduced materially over the last eight years.
The ratio of government debt to GDP is modest by the standards of many other developed countries, but the Key Government did absolutely nothing to prepare the population for the need to adjust, for example, the age of eligibility for New Zealand Superannuation if government debt is not to explode, relative to GDP, over the next few decades. (Mr English, to his credit, has refused to renew Mr Key’s pledge on this issue.)
And while the country’s net external indebtedness, relative to GDP, has improved somewhat in recent years, that external indebtedness remains at a high level, the consequence of New Zealand’s running a current account balance of payments deficit every year since 1974. Much of that deficit has been funded by banks borrowing on the international markets to fund the explosion of private sector housing debt, the result in turn of another serious policy failing, the failure to deal with the enormous increase in the price of housing (or more accurately, of residential land).
In the latest in our Five Questions For.....series we interrogate the West’s most seasoned operational intelligence officer on Russia......
Major General Peter Williams (pictured) is often considered the most experienced military specialist on Russia and its intentions. He was a member of the allied Cross Mission to the old USSR and this saw him for many years operationally involved in intelligence gathering within the Iron Curtain. At the conclusion of the Cold War he led the NATO mission to the new Russian Federation. Five questions now follow for General Williams:-
What will be the nature of the US-Russia rapprochement under Donald Trump?We are going to have to wait and see just how much free rein Trump finds himself to have. Clearly his personal outlook on the world, including on Russia, is coloured by his own lengthy career as a businessman. He is not a career politician or a Washington insider, but he and his new yet-to-be-confirmed by Congress Secretary of State will find themselves the recipients of advice from the departments of the US government, members of Congress and the US media, much of which will run counter to Trump's instincts and initial aspirations. It will all be about Trump getting better informed about the details of the many challenges to US interests posed by Russia and then coming up with a new, personal synthesis of the existing situation.In a nutshell, it's too early to say how Trump as President will react to the challenges and opportunities presented by the Kremlin, but he will stamp his own character on whatever redefined approach --possibly rapprochement, but not necessarily so-- emerges as 2017 progresses. And then there is the reality of 'events, events, events' - the unforeseeable developments that British prime minister Harold Macmillan once identified as the biggest challenge that would face any politician.
Will the trade embargo quickly dissolve?Almost certainly not. Congress seems much less likely to be in a forgiving and conciliatory mood where Russia is concerned than Trump may currently appear to be. Dismantling trade embargoes is not a simple procedure, not least where they are coordinated on a multinational basis.
Your opinion of the Russian espionage/hacking operations within the US?We will never get a clear explanation about what may have been the precise scale and details of the alleged Russian espionage/hacking operations in the US, but there is no reason, given the track record over many decades of Soviet and Russian disinformation and disruption operations, not to believe that the Kremlin has been seeking to take advantage of the perceived weaknesses of the Obama presidency, particularly during its dying months.
Others such as China, North Korea, and certain other allies will have been doing the same at the same time. The US, along with the West in general including far-off New Zealand, is a pretty soft target for disinformation and disruption operations. Whether any Russian hacking actually managed to affect the outcome of the US Presidential and Congressional election process we'll almost certainly never know for sure.
Where and why did Western-Russian relations go wrong during the Obama years?It is perhaps more accurate to describe what failed to happen, rather than what actually went wrong. Obama and Hillary Clinton sought to re-set the US-Russia relationship, but in truth the rupture went back to 2007 when Putin re-evaluated the relationship and decided that it had not been in Russia's national interests to allow the West to get too close to Russia.By 2007 NATO enlargement had brought the Alliance right up to the borders of the Russian Federation and now the threat of Ukrainian and Georgian membership of NATO was identified as a step too far into the cordon sanitaire that the Kremlin felt must separate the West physically from Russia. The EU had also been expanding to the east in a similar manner, taking into its fold nations that Russia had long viewed as Russian client states.
The 2008 Georgian war put paid to NATO's expansion - even if Russia's military campaign had been tactically and operationally less than flawless, the strategic result was clear: Russia had stopped NATO enlargement in its tracks. The final straw was the EU's active encouragement of the Euromaidan overthrow of the democratically elected albeit utterly corrupt Ukrainian president. The seizure and annexation of Crimea and the Kremlin-supported insurrection in Eastern Ukraine put paid to any chance of rapprochement between Russia and the West in all its forms, not least NATO and the EU.
Taking a world view, where do you see Western-Russian relations in five years?Whatever the situation will be in 2022, it is sure to be different from the situation today where Western-Russian relations are concerned. It is much too early to be able to predict whether Trump will actually launch a process that might deliver a substantive rapprochement with Russia. If he does so, such a rapprochement will not be without its risks, one of which must be a danger of fracturing the current common hard line that the West has been holding against Russia.
In the last year or so, sensing a vacuum in Western leadership, Russian strategy in Syria has wrong-footed the West. Russian military power has enjoyed a significant victory, which will both strengthen the position of the hawks in the Kremlin and will give a boost to Russia's state-controlled armaments sector, which can expect increased export sales as a result of the technology demonstration that the Syrian intervention has provided.
Finally, although I am by nature one of life's cautious optimists and I believe that rapprochement with Russia could be portrayed as a sensible act of realpolitik, it is hard to see just how Trump can deliver the re-set of the US-Russia relationship without which any wider Western-Russian rapprochement seems doomed to fail. If The Donald can pull off this deal, he will have confounded his sceptical enemies and will have earned the adulation of his new-found supporters.
| From the MSCNewsWire reporters' desk | Friday 6 January 2017 |