Why finance companies fall over

October 14, 2008 by

– John Edmundson

While New Zealand has not yet experienced financial turmoil of the type facing the USA, there has been an unprecedented series of collapses of finance companies over the last two years. It is easy to simply blame the directors of these companies as individuals, identifying their greed and the criminality they have resorted to. This is the approach that the mainstream and financial media have taken, in some cases with a quite critical eye, but the problems are deeper than that.

The collapses began in 2006. The first significant company to go was Provincial Finance, known for its “Solid as, I’d say” endorsement from ex-All Black Colin Meads. Established as a mortgage lender, by December 2005 this represented only 6% of its business, while vehicle loans by then accounted for 83% of its lending.

While real estate holds its value or appreciates during good economic times, cars begin to depreciate the moment they are driven out of the yard. Defaults on loan payments from typically low-income, overstretched borrowers became rife, and Provincial Finance was left with increasing numbers of repossessed vehicles. The problem became so severe that the company bought a car yard to sell the 150 repossessed vehicles a month that they were saddled with.

By 2006, the whole edifice was in receivership, along with two others, National Finance 2000 Ltd and Western Bay Finance. At the time of the Provincial Finance failure, commentators responded by advising “mum and dad” investors to be more careful with their investments, but declaring that the collapse “doesn’t mean the entire sector’s dodgy”.

[Read more…]

Filed Under: Economics Tagged With: ,

Abolish *all* GST

October 14, 2008 by

We produce the goods and services – let’s take ownership of them all!

GST was first introduced in NZ by the fourth Labour government in 1986 at the rate of 10%. While a similar tax in Britain excluded basic family items, the only things Labour excluded from GST here were financial services, real estate transactions and the operations of very small firms.

GST significantly raised the level of indirect taxation. The proportion of government income derived from indirect tax rose from 22.5% to 33.2% within just the first two years of the new tax.

In 1988, the fourth Labour government slashed the top personal tax rate from 66% to 33% and, the following year, 1989, GST was increased to 12.5% and imposed on all goods and services.

[Read more…]

Filed Under: Campaign Against GST Tagged With:

Not much done, lots more to do

October 14, 2008 by

– John Edmundson

As election day nears, you’d think it would be time for union leaders to raise workers’ needs in front of the politicians. The New Zealand Council of Trade Unions (CTU) has released its spin on the latest statistics summarising the socioeconomic state of New Zealand in the last decade.

The CTU’s assessment of the Ministry of Social Development’s 2008 Social Report, headed “Social Report: Lots done, more to do”, could best be described as a pro-Labour spin on some pretty mixed statistics for the last decade, a period dominated by the Clark Labour government.

“The social wellbeing of New Zealanders has improved since the 1990s with most social indicators moving in the right direction,” enthused CTU vice president Maori Sharon Clair. “Clearly there is more to be done. Low wages are still holding back the country, and 13% of households in poverty is 13% too many. In many indicators the trends are good, however,” Clair said.

Of course, she is right, in a “lies, damned lies and statistics” sort of way. But what does “most” social indicators actually mean? A look at the actual report reveals a much less praiseworthy result than the CTU spin would suggest. I encourage anyone interested to go to http://www.socialreport.msd.govt.nz and make their own assessment of it.

[Read more…]

Filed Under: 2008 Election, NZ Labour Party, Poverty in New Zealand Tagged With: ,

Why the Workers Party stands in capitalist elections

October 14, 2008 by

– Nick Kelly

Editorial from the October 2008 issue of The Spark

As this issue of The Spark goes to press Wall street is in trouble. The international capitalist economy is yet again entering a downturn As we head into the general election, New Zealand voters once again face a choice of political parties who will uphold this capitalist system. For 16 of the last 24 years Labour has governed New Zealand, the gap between rich and poor has widened faster than in the previous 35 years when National, the overtly right-wing party, won more elections than it lost.

The Workers Party has no illusions that parliamentary politics, or the 2008 election, can produce the change that people need. However, we see the election as a useful platform for socialist politics.

We see working people standing together and fighting the system as the way forward. We are standing to promote the idea that working people can organise to end capitalism’s exploitation and build a better life for themselves and for humanity as a whole.

Our election campaign is about highlighting these ideas and showing a real alternative to the increasingly similar politics offered by Labour, National, and their potential coalition partners currently in parliament.

Our party has stood firmly alongside Wellington bus drivers who were recently locked out by their employers, NZ Bus. In 2006 we actively supported the locked-out NDU workers from Progressive Supermarkets in a similar dispute.

We urge all working people to support our 2008 election campaign. Help us build the Workers Party and end exploitation and poverty.

Filed Under: 2008 Election, Fightback News

Workers Party candidate fights unjust law

October 14, 2008 by

The Spark recently spoke to Workers Party Christchurch East candidate Paul Hopkinson, the first school teacher to be suspended under the undemocratic provisions of the 1993 Electoral Act.

Under the current law most public servants (including teachers) must take unpaid leave for the three weeks between nomination and polling day. Paul Hopkinson refused to take unpaid leave when requested, and as a result has been told by his employer that he is being suspended without pay.

[Read more…]

Filed Under: 2008 Election, Civil Liberties, Fightback News Tagged With: ,
«Previous Page
Next Page»