This post is a challenge to Selwyn Pellett who posted the following Tweet last night:
So difficult 2 understand how intelligent folk can justify selling our energy assets that return a net $100m. Guess they're not intelligent
I responded by saying that such assets would simply
sell for the net present value of future cashflows, so the government was
simply taking those future cashflows now. Sensible, what was the problem? I then pointed him to this blog, and stated
that the asset sales were not, firstly, for me, an economic issue, they were a
philosophical and moral issue, namely: governments owning such assets are part
of a planned economy which is reliant, always, on a government planning my life
for me, starting with the extortion of taxes. That is, the issue concerns my
freedom from the big state and my desire to move to a free, classical liberal
society.
Selwyn didn’t get this: sadly, as with most
businessmen, these guys don’t understand the link between philosophy, economics
and politics, and the combination of these that has allowed their success (and
conversely, those factors still holding them back, while keeping us all in the
prison of state). His last post, and I’d gone to bed so haven’t responded yet,
was:
I believe when I'm overcharged under current model it's just a tax, not a foreign dividend flow! Huge difference to NZ
You’ve missed the point on all levels, Selwyn. Okay,
let’s ignore philosophy, I’ll answer you by a setting out the problem with this
last statement, from the point of view of erroneous thinking, and my
challenge to you is tell me how I’m wrong (remembering my challenge to Bernard Hickey still remains unanswered). This reply is indebted to the multitude of
economic blogs and sites I read, which have become intermingled in my mind, but
I suspect the below answer is particularly indebted to Paul Walker at
Anti-Dismal – my apology if that attribution is wrong.
Selwyn, say that I’m a Mexican, and I buy a
shareholding in one of the energy companies here when it is floated. After the first
year I’m going to be distributed a dividend of NZ$100k. You call this a ‘foreign
dividend flow’, and seem to think it bad for New Zealand. However, think about
it, I can’t spend NZ dollars in Mexico, the drug lords just don’t want them, so
the only way I can spend this dividend is to first exchange my NZ dollars with
pesos, that is, I have to find someone to sell my NZ dollars to. The only
person who is going to buy those dollars from me will be doing so to spend back
in New Zealand, that’s the only place they can be spent, ultimately. So, where’s
the outflow of physical dollars from New Zealand? Explain it to me.
That’s my question to Selwyn, as one of the - per his
first tweet - ‘intelligent folk’, but it is also the precursor to another blog
soon regarding all this nationalistic BS. In late 1930’s Europe, a very evil
man used the emoting nonsense of nationalism to get himself voted in after a
banking collapse. With Golden Dawn, Fascists, just voted into the Greek
Parliament, is anyone feeling nervous in 2012?
To a freedom freak like me, national borders mean
nothing. My freedom is indeed dependent on global laissez faire, which is also
the best recipe for global peace. Yet businessmen like Selwyn are happy to whip
this emoting foolishness up all over again over issues like this. And
unbelievably, the Left in New Zealand seem to have done away with the Internationale,
and nationalism has become one of their guiding polices. Chris Trotter’s social
democratic credo drips with the blood of nationalism in his final stanzas. How
do they square that? How do they square a union protecting a cushy job in New
Zealand, thereby taking the food away from a subsistence family in the Third
World reliant on an increasing standard of living by working in a sweatshop? Surely their lives are not worth less than ours'?
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