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.

.

Labour’s Parody Account – Restrictions on Foreign Ownership.

Monday Headline: Labour Protest Surveillance State While Leader Announces Command Economy.


I understand at the end of QandA over the weekend the bloke who writes satirical blog, The Civilian, announced plans for launching a political party? I only saw the start of that show and was too busy laughing to view beyond the Labour Party leader interview. I further assume  such a new political entity to be a parody party?

I wonder, did that nice young man stay for his interview at the end of the show, or did he slink off after watching Mr Shearer also?

This is Labour’s stunning strategy for the 2014 campaign: to implement policy that will destroy the value of New Zealand held assets.

That’s it.

There will be a capital gains tax on investment houses – at least that’s how it will start, this is how it will end – plus Chinese foreigners will be restricted from buying our existing housing stock, as Chinese foreigners will be restricted from buying our farms.

In this country with its tiny population - smaller than many cities - with our limited capital pool, and often skills shortages, Labour are going to campaign 2014 on making New Zealand an unattractive place to invest your money.

For all the farm and house owners in New Zealand, to give clarity here, Labour want to destroy the value you have built up in your homes and farms. Say if you’re on struggle street and have been using your Working for Families and tax transfers, perhaps your DPB, to repay, say, $20,000 off your mortgage over the last five years, in the sweep of a statute Labour want to write that value off your house, so you’re back to where you started.

Hilarious.

Labour actually want to create a country-wide Christchurch earthquake that will hit every city and every rural enclave, and the punch line is, there’s to be no insurance you can take against it this time – other than perhaps getting your money out of the country first.

And why did Mr Shearer announce this policy on Sunday morning? In a shocking revelation he looked down the camera at every home owner, every farmer, and voice lowered spoke of how in South Africa he’d witnessed, first hand if such is to be believed, some sort of clandestine trade show where businesspeople were advising South Africans that New Zealand was a great place to invest. Why leave their savings in South Africa for South Africans when they could give their savings to a Kiwi house or farm owner for them to invest and perhaps even retire on, so helping to fix New Zealand’s part of that world-wide problem of baby boomers selling their homes into shrinking markets to retire.

That’s the stunning economic policy announced by Labour this Sunday morning. If only this were a laughing matter, but of course it’s not. They mean it.

For the record, I’ve explained on this blog why foreign investment is not only nothing to fear, but a matter for us to rejoice in, certainly economically, but also culturally: there are many posts that touch it, but read especially this one, and then this one. And I challenge any Labour MP to take the challenges given on those two posts.

Our lives are ruled by these inappropriately named representatives of ours in the Fortress of Legislation, and they are first incompetent, economic illiterates, but secondly, most importantly, philosophically bereft. Turning to that other topic, look at the contradictions coming out of the Fortress over just this weekend again:

Labour MP’s on the street protesting the GCSB Bill, while their leader announces the planned economy: all seemingly unaware that a planned economy can only happen consequent on planned lives, and planned lives can only happen when our rights are taken away from us, including our right to be left alone by the surveillance state necessary to separate us from our property and income. Shearer’s announcement for the economy this weekend, is the economics, therefore philosophy, therefore politics, of the surveillance state.

And then there’s this clown again, posting from his parody account:

@PeterDunneMP And surveillance of an entire population is what? #DoTheyThinkWeAreStupid
— Mark Hubbard (@MarkHubbard33) July 28, 2013

To the guy at the Civilian, do you see what I mean yet? Just give up mate: the competition is too stiff in your part of the market.


Update 1:

And if there were not enough parody in all this, Rob Hosking now reports Labour haven't even done the basic proofing homework on the statistics that are informing this policy: paid link, so get a subscription, but:

It is a mark of how bogus the housing debate has become that Labour’s figures about foreign owners of New Zealand houses almost definitely include former leader Helen Clark and her four houses.

The current Labour leader and Miss Clark’s successor as MP for Mt Albert, David Shearer, claimed at the weekend there are "more than 11,000 overseas investors [who] own properties here that they don't live in".

What Mr Shearer did not say is the figure comes from Inland Revenue’s numbers about “non-resident” taxpayers who pay taxes on houses they  own in New Zealand.

"Non-resident" taxpayers are largely made up of expatriate New Zealanders and in this context are those who have gone overseas and who have rented out their properties here.

Race Relations Office Has Turned Censor And Must Go. Peters v. DeVoy: 0 - 0.

We owe a debt to new Race Relations Commissioner, Dame Susan Devoy, for finally demonstrating how retrograde that office is, and how it has no place in a free society.

According to Dame Susan:

Race Relations Commissioner Dame Susan Devoy says she is still formulating her views on racism and has NZ First leader Winston Peters in her sights.

After almost three months since her appointment as commissioner, Dame Susan said she was still "getting a good grasp" on racism and revealed she now deemed controversial cartoons published in South Island papers recently as racist despite previously saying they were not.

She told TVNZ's Q+A programme this morning that she was "starting to formulate my ideas" about racism and said that she would be forced to get involved if Mr Peters continued his "tirade" against the Chinese community.

Where do I start.

Well, for a start my tax money is obviously funding rank amateurism: surely the officer hired to that job has a slightly better grasp of what racism is than this? In fact surely they have an actual grasp of what racism is, period. I pay a teenage apprentice to learn on the job, not a political office at this level.

Though that's just offensive to me, as a member of that bottomless pit known as the taxpayer, and doesn't broach the harm Dame Susan is doing here, in her comments on leader of New Zealand First, Winston Peters.

Winston Peters campaign against the Chinese community is misinformed at best, racist and bigoted at worst, just as is Labour and Green's targeted campaigns against Chinese investment, especially in cognisance of other Euro-centric countries being bigger investors in New Zealand assets. I am particularly well placed to be making the comments in this post, because I have spent some portion of this blog defending Chinese investment against the xenophobia and economic ignorance of our political Left:

Foreign Ownership of Assets I.

Foreign Ownership of Assets II.

But that aside, we classical liberals understand that free speech is the best defence against bigots and racists: such haters must not be silenced by the state, only by reason, as they are given the rope to hang themselves pursuant to the judgement of civilised, informed minds. Being offended is never a crime. Hate speech laws, are freedom hating laws. I don't want Dame Susan using the power of state to censor, and it's appalling her Race Relations primer for Dummies has led her up the garden path of doing so. That garden path merges always with the road to our serfdom. Without free speech, the West becomes the East, circa Cold War.

The Race Relations office must now be disbanded, though while Dame Susan waits in the antechamber, and given she has thrown herself into the childish sand pit of political partisanship, perhaps she could pen a missive to censor and censure both Labour and the Greens for their program of repugnant nationalism ... that is, as far as the Chinese are concerned. Then please someone give Dame Susan a copy of Freedom for Dummies: or as I call it, my blog.

Because finally, the most important question to come from this, is what has happened that our theocrats in the Fortress of Legislation no longer understand that foundation stone of the free society: free speech? No, wait a minute, they're theocrats, I've answered my own question. The solution, of course, is minarchy, and Libertarianz.