14 May 2014

Spinning the wheel with PR.

From the ship-wrecked economy the horizon looks rosy for Key & English.

Tom Scott sums up all that NZ can expect from the Key - English PR spun economic management. An illusionary "surplus" with promises of a reduced economy from tax cuts for a  "middle class"that has been squeezed out of existence by the wealth accumulators and employment removers.

13 May 2014

On Income Inequalities and Global Capitalism

How To Combat Inequalities Produced By Global Capitalism

Guy Standing, Global Capitalism
Guy Standing
Rising inequality is one of the most salient issues in global and European politics. Guy Standing writes that what we have witnessed in recent decades is not simply an increase in inequality, but also the emergence of a new globalised class structure. A key component of this structure is what he terms ‘The Precariat’: a new class comprising those who lack economic security and stable occupational identities, which has systematically been deprived of some of the fundamental rights afforded to citizens. He argues that a new ‘Precariat Charter’ is required to combat these insecurities, including provision for a basic income as a right of citizenship.
Next year is the 800th anniversary of the Magna Carta, the first class-based charter of liberties against the state. Today, we need a Precariat Charter to advance the rights of the precariat and substantially reduce the inequalities and insecurities in society. This is the theme of my new book, A Precariat Charter: From Denizens to Citizens (Bloomsbury).
The context is clear. We are in the midst of a Global Transformation, in which a globalised market system is under painful construction. In its dis-embedded phase, the transformation was dominated by the interests of financial capital, just as was Karl Polanyi’s Great Transformation. Inequalities multiplied, economic insecurity became pervasive. Above all, a new globalised class structure took shape. All economic and social analysis of the growth of inequality that ignores the class dimension is like trying to play Hamlet without the Prince.
The emerging mass class is the precariat, looking up in income terms to a tiny plutocracy-cum-oligarchy striding the world, manipulating democracy and raking in rental income, and looking up to the salariat between them, receiving more and more of its income from capital and the state. The old proletariat, the old working class in numerical decline is rapidly losing its labour securities and non-wage forms of economic security.
The precariat has distinctive relations of production (unstable labour, lack of occupational identity, a high ratio of work-for-labour to labour, and so on), distinctive relations of distribution (depending on money wages that are stagnant at best, and volatile as the norm, living on the edge of unsustainable debt), and distinctive relations to the state. This last aspect has received too little attention. The precariat is the first mass class in history that has been systematically losing the acquired rights of citizenship – civil, cultural, political, social and economic. The precariat consists of supplicants, being forced to beg for entitlements, being sanctioned without due process, being dependent on discretionary charity.
More and more people, not just migrants, are being converted into denizens, with a more limited range and depth of civil, cultural, social, political and economic rights. They are increasingly denied what Hannah Arendt called ‘the right to have rights’, the essence of proper citizenship.
This is key to understanding the precariat. Its essential character is being a supplicant, a beggar, pushed to rely on discretionary and conditional hand-outs from the state and by privatised agencies and charities operating on its behalf. For understanding the precariat, and the nature of class struggle to come, this supplicant status is more important than its insecure labour relations.
Guy Standing argues in favour of a 'Precariat Charter' for workers. (photo: CC Zoriah on Flickr)
Guy Standing argues in favour of a ‘Precariat Charter’ for workers. (photo: CC Zoriah on Flickr)

 The Precariat And Global Capitalism

The precariat’s position must be understood in terms of the changing character of global capitalism and its underlying distribution system, something that Thomas Piketty did not address. In the 20th century, uniquely in human history, the distribution of income was primarily between capital and labour, between profits and wages, mediated by the state with its taxation, subsidies and benefits. The bargaining over the respective shares was won on points by the representatives of employees in the post-1945 period, but after the late 1970s was won decisively by capital. Everywhere the functional distribution of income became more unequal, with labour’s share of national income dropping dramatically, nowhere more so than the emerging market economies, including China most of all.
However, the key to understanding the challenge ahead is that two factors have changed the context completely. Historically speaking, from the 1980s onwards the labour supply to the global open labour market quadrupled, with all the newcomers being habituated to labouring at one-third or less of the median income of the workers in OECD countries. This led to the start of the Great Convergence. It was facilitated by the new technological revolution, which among other things allowed the corporation to unbundle, shifting production and tasks to wherever costs were lowest.
In this new context, rental income has become a major and growing component of total income. This is far more important than patrimonial capitalism, which Piketty identifies as the main feature of modern capitalism. Rent comes in several forms, notably by possession of so-called intellectual property, through patents, and through privileged possession of scarce commodities and natural resources. Last year was the first year in which over two million patents were registered, guaranteeing trillions of dollars to their owners stretching on average twenty years.
The rental economy extends all the way down to pay-day loans, whereby members of the precariat are exploited by disgustingly high interest rates, often exceeding 5,000 per cent. It includes the vast array of subsidies given by the state to corporations and the affluent in the salariat and elite.
What the precariat must demand now is little less than a new distribution system, not just a tinkering on marginal or average tax rates. Indeed, the weakest aspect of Piketty’s analysis is his prognosis. The likelihood of very high marginal direct tax rates is remote. Structural changes are required.
A Precariat Charter must start from understanding the nature and depth of insecurities faced by the precariat, and also from understanding the aspirations that exist in the more educated component of the precariat. It would be quite wrong to imagine that the precariat wants a return to the old norms of full-time stable wage labour.
It wants to build a good society, resurrect a sense of “a future” and create institutional networks that would enable more and more to pursue a life of work, labour and leisure. That means building their own sense of occupation, in which ecological values of reproductive work predominate over the resource-depleting values of labour.
The assets that need to be redistributed are not like the old socialist project of a hundred years ago, when the proletariat was emerging as the mass class. The assets underpinning a Precariat Charter are basic security, control of time, quality space, education, financial knowledge and financial capital. A key demand is for moves towards the realisation of a basic income as a right of citizenship. Without basic security, none of us can be expected to be rational and socially responsible. Let us find ways of going on that road.
For a longer discussion of this topic, see Guy Standing’s latest book, A Precariat Charter: From Denizens to Citizens (Bloomsbury). This column was first published by EUROPP@LSE.

10 May 2014

The Bellman tolls for Judith Collins... who will be next in the Nats' power struggle?

Cash for access "fund raiser dinners" provide more evidence of the arrogance and crony legislation that has swirled around John Key since 2008.

 Ever since John Key came to power concerns about crony capitalism and legislating for those who weilded the big cash stick have been a feature of speculation across the blogs and political activists. While it was conveniently swept under the carpets by the MSM the scandals around Collins, Williamson, Woodhouse and Key have forced the MSM to reveal what they have known about the questionable tactics practised by the National Party from the period of the Waitemata trust on. The result has been to bring to light the fighting factions within the National Party.

It is very interesting to note that the factions within the National Party have reformed and begun to marshall their forces around the various pretenders for the empty suit that Crosby-Textor created for John, Pinokeyo, Key back in 2008 now that Judith Collins has reduced her aspirations to leadership to a shadow after her Oravida scandal allegations and her obvious inability to handle criticism and scrutiny in both the House and by the public.

Audrey Young, in the Herald (usually a mouth piece for the National Party), has put the boot into Collins' credibility in her article " A Big Question Hanging over Judith Collins" and, in so doing, reveals that Collins' support is from the extreme right of the National Party backed up by the Slater family whose credibility is somewhat questionable when one considers the Palino Mayoraltyscandal / Whaleoil connections. Even the Metro Magazine is rolling out the tumbril.

Young's criticisms are echoed by John Armstrong who ponders on why the wheels are falling off the National Party's election wagon and lays the blame firmly on the public scandals around Collins and Williamson and then hammers home the "Cash for Access Fund-Raising scams" and obvious deep pocket cronyism that is the feature of the Key owned National Party.

One, however, does wonder at credibilty the proposition of Paula "whack a beneficary for fun" Bennett as a possible Deputy Leader of the National Party  put forward by the opinionistas .. but then then the paucity of leadership possibilities within the current National Party then anything is possible.
Now that the Herald has begun to shine a torch into the dark and murky corners of the National Party closet the possibility of the PR gloss being scraped off the Key government may reveal more of the arrogant cronyism which has disenfranchised the ordinary working voters being exposed  and thus giving more incentive to go and vote the Key owned National Party out on the 20th of September.

The rumours of a palace coup being brewed in the National Party Closets that have circulated for much of year are obviously proving to have more truth than rumour to them.

5 May 2014

On the myth of the Job Creators.

In recent weeks the writings of Thomas Piketty have excited economists around the world and caused alarm among those who own the greatest wealth but create no jobs or production.
This article from The Social Journal Europe are pointers to how a more equitable distribution of wealth would benefit the total economy of any country and thus create employment and jobs.
Why a Global Wealth Tax would help address inequality.

4 May 2014

The scandals that hang around John Key's neck

John Key's cabinet has been the most scandal ridden in recent political history

The writing is definitely on the wall for the Key owned National Party. The list of disgraced MPs and forced resignations from the Cabinet from this administration is the worst in recent political history.
From Richard Worth, Pansy Wong, Nick Smith, Phillip Heatley, John Banks, Hekia Parata, Judith Collins and, now, Maurice Williamson the scandals are clear demonstrations of John Key's inability to act as a responsible and ethical PM. The questionable behaviour by the rank and file MPs like Garrett (ACT) and Aaron Gilmore add more to the public concern about the National-ACT government.
In the light of these scandals it should become obvious, even to the usually deaf John Key, that Judith Collins is, like so many of his cabinet, a liability not just to the National Party but to the reputation of the country and as such she must go and go quickly. (When Fran O'Sullivan, who usually shills loudly for the Key owned National Party, declares that Collins is a liability to the National Party & Government then one knows that the skids are truly under the PR created government of John "Smile, wave, scuttle and run" Key.
Despite Bill English's protestations at this weekend's National Party regiona conference it would be hard to find anyone who would believe in the competence of Key or his corporate crony hugging ministers especially as rumours of discontent, fueled by National blogger, Matthew Hooton, with Key within the National Party have begun to swirl in the blogosphere.
The disarray and sense of panicked lack of direction in the National Party was in clear evidence in the Judith Collins- John Key linked blogger's attempts to muddy the waters around the scandal of Maurice Williamson's ties with the $22000 Chinese donor to the National Party and, after being told that her complaint to TVNZ about the reporting of her Oravida dealings had been rejected
(Television New Zealand's rejection of a complaint from Justice Minister Judith Collins is another blow to the Justice Minister's battle with the media.
The complaint relates to a TVNZ Press Gallery report on One News in March, looking at revelations in Parliament about Oravida, but the state broadcaster has rejected her complaint following an investigation.
TVNZ declined to spell out the findings of its investigations, or the date of the rejection letter.
But it has been confirmed the minister was told well before her altercation in the weekend, when she accused TVNZ political journalist Katie Bradford of seeking intervention in a personal matter in 2010.), Collins' own vicious outburst attacking a TVNZ journalist by name followed up by trying to accuse the NZ First Deputy Leader of actions similar to that engaged in by Williamson and the messages of impending defeat on September 20th delivered by English at the Waipuna Lodge this weekend may have been supported by the substantial earthquake in Wellington which would have shaken Key's belief that he is truly a national treasure.

3 May 2014

How the John Key owned National Party sees itself

John Key's policy making process... on sale to the highest foreign corporate bidder.
In view of the scandals around John Key and his cabinet, especially those around Judith Collins and Maurice Williamson, this cartoon is very appropriate.
The obvious desire to sell NZ law making and assets off to the highest bidder (donor to the favoured Key Charity - the National Party ) is amply demonstrated in this cartoon.