Scuttled Lochinver Farm Sale an Abuse of State Power – Why Test Threshold is Bad Criteria.

Pursuant to NBR:

As widely expected, Associate Finance Minister Paula Bennett and Land Information Minister Louise Upston have torpedoed the sale of Lochinver Station to Chinese firm Shanghai Pengxin.

Ms Bennett says ministers are not satisfied there will be substantial benefit to New Zealand in the $88 million deal.

“After detailed and careful individual consideration, we are not satisfied there will be, or is likely to be, a substantial benefit to New Zealand – a key requirement for applications of sensitive land of this size," Ms Bennett said in a joint statement with Ms Upston. 

This is an abuse of private property rights by the state; far too much power is entrusted to Ministers Upston and Bennett (noting the OIO recommended the sale be allowed).

My position is as I have commented to the NBR thread:

In order to mitigate trampling over a vendor's property rights and well-being - both seriously damaged by the state today - isn't the better test 'is there a demonstrable disadvantage' rather than 'is there an advantage to New Zealand' in such a sale progressing? If no disadvantage - a lower test and I defy either minister to prove any such disadvantage in this or any sale - then of course the vendor should be free to sell their property to their best advantage.

If there has to be a test which there shouldn't be.

And whatever the vendor is ultimately able to sell their farm for, then the state should by law have to compensate them for any loss of sale price that results.

There is no disadvantage to New Zealand in the sale of this farm to overseas interests. I suspect the test criteria is being cited by the ministers as a sop to what this really is: politicking in view of how they see their chances in the next general election. That our property rights are dependent on party politics is frightening.

Update 1:

My further comment to NBR’s story, Chinese Stuck With Lochinver Decision – noting I penned this quickly over breakfast, please excuse the typos and clumsy structuring in parts:

It's chilling how single ministers have this huge power to decimate the property rights and wealth of individuals. Because all future buyers of Lochinver must now factor in the likelihood of not being able to sell to overseas interests that will put a sizable discount on any sale price as the farm is remarketed - quite apart from the considerable transaction costs on vendor and hopeful purchaser reaching this point after 14 months of bureaucratic faffing. Moreover, we know the property could have sold for $88 million: why isn't the government liable to compensate the difference over the lower price it will now sell for? And to compensate for those transaction costs in both good faith, and a rearguard action to try and keep overseas bids on other assets in NZ?

In a free country this could never have happened. A government that supposedly believes in the small state and individual rights would have spent the time they've spent destroying the wealth of the individuals concerned here, and with it, the property rights of every one of us, instead, debating for an inalienable right that NZ demands debate on, namely euthanasia.

It's shameful and frightening what happened yesterday, at the hands of a government which has completely lost its philosophical ethos, and deserves to be swept away the next general election.

Footnote: part of the problem here is fragile politicians pandering to the xenophobic economic ludditism of too many Kiwis who don't understand that dividends going overseas don't leave the country (because $NZ can only be spent in NZ). Whereas the money that was coming into NZ from China in the premium offered on this farm would have had great benefits for us in the form of reinvestment in other productive businesses for which this money was planned.

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