The economic collapse of Middle Earth. John Key's failure writ large.

This article is republished from The Automatic Earth blog site. It makes very revealing reading especially as the writer dissects the economic failure that is John Key and his off siders Bill English and Steven Joyce.

There’s Trouble Brewing In Middle Earth

 

 April 5, 2015  Posted by Raúl Ilargi Meijer at 11:01 am Finance Tagged with: Auckland, China, dairy, Fonterra, home prices, logging, milk, New Zealand, timber, tourism

For the second time in three years, I’m fortunate enough to spend some time in New Zealand (or Aotearoa). In 2012, it was all mostly a pretty crazy touring schedule, but this time is a bit quieter. Still get to meet tons of people though, in between the relentless Automatic Earth publishing schedule. And of course people want to ask, once they know what I do, how I think their country is doing.
My answer is I think New Zealand is much better off than most other countries, but not because they’re presently richer (disappointing for many). They’re better off because of the potential here. Which isn’t being used much at all right now. In fact, New Zealand does about everything wrong on a political and macro-economic scale. More about that below.
I’ve been going through some numbers today, and lots of articles, and I think I have an idea what’s going on. Thank you to my new best friend Grant here in Northland (is it Kerikeri or Kaikohe?) for providing much of the reading material and the initial spark.
To begin with, official government data. We love those, don’t we, wherever we turn our inquisitive heads. Because no government would ever not be fully open and truthful. This is from Stuff.co.nz, March 19 2015:

New Zealand GDP grew 3.3% last year

New Zealand’s economy grew 3.3% last year, the fastest since 2007 before the global financial crisis, Statistics NZ said. Most forecasts expect the economy to keep growing this year and next, although slightly more slowly than in the past year. For the three months ended December 31, GDP grew 0.8%, in line with Reserve Bank and other forecasts. That was led by shop sales and accommodation.

That sounds great compared to most other nations. But then we find out where the alleged growth has come from (I say alleged because other data cast a serious doubt on the ‘official’ numbers):

The economy grew a revised 0.9% in the September quarter, down from 1% reported earlier. Retail and accommodation increased 2.3% in the December 2014 quarter, buoyed by a 15% increase in international tourist spending, as reported on Wednesday. New Zealand household spending also increased 0.6%. [..]
“Spending by Chinese, US, and UK visitors all increased in 2014, though Australians spent less.” Australia is New Zealand’s biggest tourism market, but the New Zealand dollar has been high against the Australian currency, trading at A96.5c on Thursday. The exchange rate was under A80c at the start of 2013. Total visitor spending last year hit $7.4 billion, up 13% on the previous year. [..]

(Note: $1 US = $1.3156 NZ today.)

Increased banking activity was reflected in a 1.1% rise in financial services this quarter, while housing investment rose 5.2%.
[..] The figures also showed the first fall in real incomes since the middle of 2012. The inflation-adjusted purchasing power of disposable income was down 0.5% in the December quarter.

We’ll get back to housing in a bit. And by all means, keep those last few numbers in mind: while the economy ostensibly grew by 3.3%, disposable income was down. That’s what you call a warning sign.
But let’s focus first on tourism and especially on China. While overall tourist spending rose 15% in 2014, as part of a later quote in this article we will even see that “tourism from China was up 40% in the first two months of this year from a year ago..”
Still, that cannot make up for that other big trade with China, exports, in particular of New Zealand’s biggest industry, dairy, and the second biggest, timber. There things are not looking nearly as rosy. And after reading the next piece, I’m wondering how the economy could possibly have grown by 3.3%. More from Stuff.co.nz, dated March 25:

Dairy Slump Hits New Zealand Exports To China

New Zealand posted a small trade surplus of just $50 million in February with dairy exports down heavily, especially to China, New Zealand’s top export market. Some economists had expected a monthly surplus of about $350 million. The trade shortfall for the year ended February 2015 was a deficit of $2.2 billion. Exports to China have boomed in the past few years, but melted down last year as dairy product prices plunged. Total exports to China in February were down more than 36% on the same month last year.
China remains New Zealand’s biggest export market, worth almost $9b in the past year, just slightly ahead of Australia. But the trend for exports to China has been falling for the past year, and is down 45% from the peak in late 2013. In fact, it has returned to levels seen in 2012. [..] Total exports were worth $3.9b for the month, just barely ahead of monthly imports which were also about $3.9b.

So sure, the 3.3% was over 2014, and this piece concerns this year. But it also says ‘the trend for exports to China has been falling for the past year,’ and ‘..The trade shortfall for the year ended February 2015 was a deficit of $2.2 billion..’ and that can only leave me wondering again what real GDP growth was. This is from RadioNZ, April 3:

Export Drop Rattles Companies

Confidence among manufacturers and exporters has taken a hit with export sales in February down 27% compared with a year ago. A survey found net confidence – which includes measures of cash flow, profitability, investment, staff and sales – fell into negative territory for the first time since April 2013. Net confidence was minus 13, down from 21 in January. The sample of Manufacturers and Exporters Association members covered companies with combined annual sales of $178 million, with 68% of those from exports. Association president Tom Thomson said currency volatility was the biggest issue for exporters, with the big jump in the US dollar forcing up the price of some raw materials.

Now I’m wondering which raw materials this fine man has in mind. See, I can imagine currency volatility being a bit of a drag, but not too much for New Zealand manufacturers, because as far as I can see the country’s exporters don’t seem to import much in the way of raw materials. The main exports, as I said, are dairy and timber, with a bit of meat thrown in, none of which require raw materials imports, and what the US dollar drives up in there would help New Zealand more than hurt it. That the New Zealand dollar itself has gained vs various other currencies, while true, is a whole other story.
New Zealand’s dairy industry has been thrown together since the start of the century in co-op Fonterra, good for 30% of global dairy exports – most dairy farmers are shareholders (mind you, no country the size of New Zealand should ever even think of exporting 30% of the world’s anything, of course, unless it’s something unique on the planet and it comes in small quantities). Fonterra’s by far biggest clients are the lactose-intolerant Chinese, who import about all the milkpowder – for their babies – they can lay their hands on, following a domestic tainted milk scandal a few years back. Still, to establish your biggest industry around one single client is obviously a very risky venture. And now there’s the added problem of dropping prices. The New Zealand Herald, April 2:

World Dairy Prices Slide 10.8% On Supply Concerns

International dairy prices continued to reverse gains made early this year at this morning’s GlobalDairyTrade (GDT) auction, putting downward pressure on Fonterra’s $4.70 a kg farmgate milk price forecast and raising concerns about next season’s likely payout. The GDT price index fell by 10.8% compared with the last sale a fortnight ago, when prices dropped by 8.8%. Big falls were recorded for the key products of wholemilk powder – down 13.3% to US$2,538 a tonne, skim milk powder – down 9.9% to US$2,467/tonne.

That 10.8% price drop occurred in just 2 weeks. There can be no doubt that if your economy depends so much on one sector and one client, you’re vulnerable. Probably as much as oil producers, who saw their prices drop more, but who mostly have higher profit margins. What hasn’t helped New Zealand dairy farmers is the Russian ban on EU milk products; these will now have to be sold on world markets. What won’t help either is the recent lifting of EU milk quotas, which will bring a huge flood of additional milk on the market. A market that is already drowning in milk. RadioNZ, April 2:

World ‘Awash With Milk’

The Government is blaming a slump in milk prices on the world market being awash with milk. But New Zealand First leader Winston Peters said National’s economic policies and the high value of the New Zealand dollar were not helping dairy farmers. In the Global Dairy Trade auction prices dropped 10.8% overnight to $US2746 a tonne, the second fall in a fortnight. Mr Peters said he predicted the fall and it was a sign of rural areas lagging behind. “I’ve been saying it for a long long time – what you’ve got is a fixation with Auckland, hollowing out the provincial economies and sucking all the attention and money to Auckland and that is not going to go on any longer.”
Mr Peters said New Zealand had a free market system that no other country followed and he would legislate to control the exchange rate, similar to Singapore’s system. “The one country that’s not devaluing at the moment is New Zealand – every other economy has. [..] Economic Development Minister Steven Joyce firmly rejected that idea. “Well, with the greatest respect to Winston I am old enough, and so is he, to remember the last time we tried to set the exchange rate in this country and it wasn’t that successful…
“What he is basically saying is that he would legislate, presumably, to put the exchange rate at a level it won’t naturally go and that means effectively increasing costs for the consumer and decreasing costs for exporters.” [..] Meanwhile, the Fonterra Shareholders Council said some frustrated farmers were considering leaving the co-operative due to the price slump.

For more than a few farmers, the situation has already proved too much. NZ Herald, Jan 11:

Stress Too Much For Farmers

At least four farmers have taken their lives since Fonterra cut its milk payout forecast for the coming season. On December 10, the dairy giant dropped its payout forecast for 2014-15 to an eight-year low of $4.70 a kilogram of milk solids. That’s nearly half the $8.40 paid in the 2013-14 season and is estimated to mean an income drop for farmers of $6.6 billion. Federated Farmers dairy industry group vice-chairman Kevin Robinson confirmed to the Herald on Sunday that it was aware of the December deaths. “There’s been discussion through Federated Farmers email about them,” he said.
Several industry experts blame high levels of rural debt for increased stress on farmers. In total, 14 farmers have taken their lives in the past six months, Chief Coroner Judge Neil MacLean said. The most recent four deaths were also confirmed by Te Aroha farmer Sue McKay, the administrator of a private Facebook-based support group. She added: “I also know some local hospitals have a number of farmers in them from attempted suicide. If there’s three in one ward alone, there will be more in other hospitals.”
Whole milk powder prices were down 11% in the month and 52% lower than a year earlier. Cheese also dropped 5% over the month.

But New Zealand also has a whole different side. If anything could explain the 3.3% GDP growth number for 2014, I’m guessing it must be this: a real estate bubble that would put most of Charles Ponzi’s heirs to shame. Not 10 years ago, mind you, Americans, but today. Will they never learn, you ask? No, they will have to have their faces pushed squarely through the stucco walls. And they’ll probably still have hope for a recovery when they come out at the other side. NZ Herald, April 5:

Hot Properties: Auckland Valuations Out Of Date Within Months

Council valuations are already out of date, with homes selling in Auckland’s overheated property market on average for more than 15% above their figure of six months ago. And previously unfashionable suburbs have recorded some of the biggest spikes as desperate buyers look for their first home. Mt Roskill made the biggest jump in the Real Estate Institute figures, which are based on Auckland sales in February and compared against capital valuations made in July last year. The valuations, which do not involve a property inspection or include chattels, were made public on October 1.
Even suburbs among the 10 with lowest rises, such as Remuera and Te Atatu Peninsula, were up 13%. Properties sold by Bayleys Real Estate last month included a West Harbour home bought for $700,000 more than its capital valuation of $900,000 and a Glendowie home with a capital value of $1.13m that sold for $1.575m. An Avondale home sold for $590,000 — $130,000 above valuation.
REINZ chief executive Colleen Milne wasn’t surprised because city fringe suburbs were now out of reach for many. The hot market made it hard for capital values to keep up, Milne said. “There has been a 19.9% median movement in Auckland in the last 18 months. I thought the CVs seemed to be quite appropriate at the time, but the whole thing is just supply and demand — we have a lack of houses,” she told the Herald on Sunday.

A ’19.9% median movement in Auckland in the last 18 months’ is about 13.25% per year, a doubling time of just over 7 years. Auckland apartment prices in the Trade.me graph below, which covers February 2014-February 2015, would double every 3-4 years.
It must be an Anglo-Saxon disease. You can see it in London, in Sydney, Melbourne, New York, Toronto. The new normal way to make your failing economy look ‘healthy’ is to sell assets to any rich foreigner or investment fund who comes knocking, no matter what the consequences, short term or long term. In all these cities, young people can forget about buying a home, that allegedly government supported dream.
And everyone but the rich are pushed out ever further into the boondock burbs. It’s a ‘policy’ that kills cities, of necessity. Cities need people, real people, all people, poor and rich and old and young, that have grown up where they live, they love where they live, they are interested in making it look good and feel good. This is an ongoing and organic process, because cities are alive, and yes, you can kill them. But that’s for another story.
Back to New Zealand’s reality for the vast majority of people, who will never be able to fork over 100s of 1000s of dollars for a house. People like the workers in the timber industry, who see slowing Chinese demand translated into job cuts both for those who cut the trees and those who transport them.
Again, a dumb idea to base a whole industry around one client, but the men and women who did the job were just glad they had work. And now they don’t anymore. Jobs that in all likelihood will never come back again. China won’t have another debt-financed growth spurt, and there are no other candidates waiting on the horizon.
And that’s all a big shame. New Zealand is not poor, but it’s by no means as rich as Australia or Canada or Germany or the US. What it does have is the potential to be largely self-sufficient. A potential that is being squandered in order to play with the big boys of globalized trade.
New Zealand has only 4.5 million citizens, one third of which live in Auckland. It has vast tracts of productive land that are now used to feed export oriented cows and American pines, neither of which are even native. It could have a great shoe industry, plenty of leather, and a textile industry, plenty of wool. But New Zealand, like everyone else, imports such basic needs from China. While having scores of unemployed people. When will that light go off?
The country’s prime minister since 2008, John Key, used to work at Merrill Lynch and the New York Fed, and that sort of background guarantees valiant efforts to sell anything in the country that’s not bolted down, and take an axe to what is. It also guarantees zero initiative to become self-sufficient.
But then there are many tragic countries and societies in the world who all suffer from the same maladie. I’ll leave you with some reflections by the man who I’m told is New Zealand’s best business writer, Bernard Hickey in the NZ Herald:

New Zealand’s Economic Winds Of Change

Chaos theory calls it the butterfly effect. It’s the idea that a butterfly flapping its wings in the Amazon could cause a tornado in Texas. The New Zealand economy has plenty of its own butterflies changing the weather for GDP growth, jobs, interest rates, inflation and house prices. [..] One of the flappiest at the moment is the global iron ore price.
It’s barely noticed here but it’s an indicator of growing trouble inside our largest trading partner, China, and it is knocking our second-largest partner, Australia, for six. It fell to a 10-year low of almost US$50 a tonne this week and is down from a peak of more than US$170 a tonne in early 2011.
China embarked on an infrastructure spree after the global financial crisis. Over the three years to 2013, China poured 6.4 gigatonnes of concrete, which was more than was poured in the US in the entire 20th century. All that concrete needed reinforcing with steel and China didn’t have enough iron ore and coking coal to make it. That building boom created a glut of apartments and debt, which China now needs to digest. [..]
.. iron ore production in Australia has only now ramped up to its peak levels. Weak demand met high supply to produce a price slump. This all may seem irrelevant to New Zealand, but it’s not. The Australian dollar has fallen in response to the iron ore crash, while New Zealand’s dollar has remained strong because our economy is humming along, thanks to building surges in Christchurch and Auckland and plenty of spending and investment.
That divergence between the Australasian economies drove the New Zealand dollar to a record high of well over AUD$98 this week. Dollar parity would make all those winter holidays on the Australia Gold Coast and trips to shows in Sydney and Melbourne cheaper and generate a fierce headwind for manufacturing exporters and tourism businesses here that sell to Australians.
President Xi has reinforced the contrasting effects of the changes in China on Australia and New Zealand by encouraging consumers and investors to spend more of China’s big trade surpluses overseas. Tourism from China was up 40% in the first two months of this year from a year ago, and there remains plenty of demand from investors in China for New Zealand assets.
The dark side of this tornado in New Zealand after the flapping of the butterfly’s wings in China was felt in Nelson this week. The region’s biggest logging trucking firm, Waimea Contract Carriers, was put into voluntary administration owing $14m, partly because of a slump in log exports to China in the past six months.
That’s because New Zealand’s logs are now mostly shipped to China to be timber boxing for the concrete being poured in its new “ghost” cities. The Chinese iron ore butterfly has flapped and now we’re seeing Gold Coast winter breaks become cheaper and logging contracts rarer.

The Damage Fallacies of Neo-Liberal economics cause

The on-going and recent scandals (Judith Collins & Oravida, Maurice Williamson & Donghua Lui, John Key & Dirty Politics....)  in New Zealand that have swirled around the neo-liberal National Party government of Key, supported by the discredited political parties of ACT and United Futures, with a combined total of 18000 nation wide, and the Maori Party did not prevent their re-election in the September election. The result is still being analysed and the fall-out worried over by those on the Left of the political spectrum. However, I think that this article in The Guardian best explains why, despite the National Party offering no visible policy direction for New Zealand except for a "steady as she goes...don't rock the boat" campaign which, late in the campaign, held out the possibility of tax cuts in 2017 the electorate cast their Party vote for National.

The description of the personality that dominates the Neo-Liberal society is an exact description of those, like Key, Joyce, Collins, and Bennett, who are now stitching up deals with the "support parties"  like ACT and United Futures to consolidate the striping of the State we have seen since 2008.

Neoliberalism has brought out the worst in us

An economic system that rewards psychopathic personality traits has changed our ethics and our personalities

• 
• • Paul Verhaeghe
  • theguardian.com, Monday 29 September 2014 09.00 BST

'We are forever told that we are freer to choose the course of our lives than ever before, but the freedom to choose outside the success narrative is limited.' Photograph: Lefteris Pitarakis/AP

We tend to perceive our identities as stable and largely separate from outside forces. But over decades of research and therapeutic practice, I have become convinced that economic change is having a profound effect not only on our values but also on our personalities. Thirty years of neoliberalism, free-market forces and privatisation have taken their toll, as relentless pressure to achieve has become normative. If you’re reading this sceptically, I put this simple statement to you: meritocratic neoliberalism favours certain personality traits and penalises others.

There are certain ideal characteristics needed to make a career today. The first is articulateness, the aim being to win over as many people as possible. Contact can be superficial, but since this applies to most human interaction nowadays, this won’t really be noticed.

It’s important to be able to talk up your own capacities as much as you can – you know a lot of people, you’ve got plenty of experience under your belt and you recently completed a major project. Later, people will find out that this was mostly hot air, but the fact that they were initially fooled is down to another personality trait: you can lie convincingly and feel little guilt. That’s why you never take responsibility for your own behaviour.

On top of all this, you are flexible and impulsive, always on the lookout for new stimuli and challenges. In practice, this leads to risky behaviour, but never mind, it won’t be you who has to pick up the pieces. The source of inspiration for this list? The psychopathy checklist by Robert Hare, the best-known specialist on psychopathy today.

This description is, of course, a caricature taken to extremes. (Hardly, sounds exactly like those at the head of the NZ National Party.)  Nevertheless, the financial crisis illustrated at a macro-social level (for example, in the conflicts between eurozone countries) what a neoliberal meritocracy does to people. Solidarity becomes an expensive luxury and makes way for temporary alliances, the main preoccupation always being to extract more profit from the situation than your competition. Social ties with colleagues weaken, as does emotional commitment to the enterprise or organisation.

Bullying used to be confined to schools; now it is a common feature of the workplace. This is a typical symptom of the impotent venting their frustration on the weak – in psychology it’s known as displaced aggression. There is a buried sense of fear, ranging from performance anxiety to a broader social fear of the threatening other.

Constant evaluations at work cause a decline in autonomy and a growing dependence on external, often shifting, norms. This results in what the sociologist Richard Sennett has aptly described as the “infantilisation of the workers”. Adults display childish outbursts of temper and are jealous about trivialities (“She got a new office chair and I didn’t”), tell white lies, resort to deceit, delight in the downfall of others and cherish petty feelings of revenge. This is the consequence of a system that prevents people from thinking independently and that fails to treat employees as adults.

More important, though, is the serious damage to people’s self-respect. Self-respect largely depends on the recognition that we receive from the other, as thinkers from Hegel to Lacan have shown. Sennett comes to a similar conclusion when he sees the main question for employees these days as being “Who needs me?” For a growing group of people, the answer is: no one.

Our society constantly proclaims that anyone can make it if they just try hard enough, all the while reinforcing privilege and putting increasing pressure on its overstretched and exhausted citizens. An increasing number of people fail, feeling humiliated, guilty and ashamed. We are forever told that we are freer to choose the course of our lives than ever before, but the freedom to choose outside the success narrative is limited. Furthermore, those who fail are deemed to be losers or scroungers, taking advantage of our social security system.

A neoliberal meritocracy would have us believe that success depends on individual effort and talents, meaning responsibility lies entirely with the individual and authorities should give people as much freedom as possible to achieve this goal. For those who believe in the fairytale of unrestricted choice, self-government and self-management are the pre-eminent political messages, especially if they appear to promise freedom. Along with the idea of the perfectible individual, the freedom we perceive ourselves as having in the west is the greatest untruth of this day and age.

The sociologist Zygmunt Bauman neatly summarised the paradox of our era as: “Never have we been so free. Never have we felt so powerless.” We are indeed freer than before, in the sense that we can criticise religion, take advantage of the new laissez-faire attitude to sex and support any political movement we like. We can do all these things because they no longer have any significance – freedom of this kind is prompted by indifference. Yet, on the other hand, our daily lives have become a constant battle against a bureaucracy that would make Kafka weak at the knees. There are regulations about everything, from the salt content of bread to urban poultry-keeping.

Our presumed freedom is tied to one central condition: we must be successful – that is, “make” something of ourselves. You don’t need to look far for examples. A highly skilled individual who puts parenting before their career comes in for criticism. A person with a good job who turns down a promotion to invest more time in other things is seen as crazy – unless those other things ensure success. A young woman who wants to become a primary school teacher is told by her parents that she should start off by getting a master’s degree in economics – a primary school teacher, whatever can she be thinking of?

There are constant laments about the so-called loss of norms and values in our culture. Yet our norms and values make up an integral and essential part of our identity. So they cannot be lost, only changed. And that is precisely what has happened: a changed economy reflects changed ethics and brings about changed identity. The current economic system is bringing out the worst in us.

KEY REVEALS HITLER COMPLEX - CONTINUES ASSET STRIPPING

KEY, RYALL & JOYCE REVEAL DEEP SEATED HATRED OF DEMOCRACY

Key gives the NZ public the message...."When I say SELL I mean let's have a FIRE_SALE!!"

Following the 2nd September success of the Keep NZ's Assets petition the Key government had two alternatives - (1) dance on tne head of a pin and over ride the demands of the people and continue with the asset stripping and (2) accept the petition as a genuine indication by the people that they had not given Key, Joyce and Ryall carte blanche to strip NZ of ownership of its assets and invest them in the hands of the foreign based corporate raiders. 

The real winners of the Key driven demand to sell the state assets will not be the NZ public.

The National Party bloggers went into over drive testing the specious argument that the Keep NZ Assets Petition was invalid because it wasn't a "genuine" citizens initiated referendum but was a "politically motivated" referendum. On the basis of this pin head dance argument Key, Ryall and Joyce were convinced that they had the god given right to disregard the success of the petition calling for the referendum. 

Then, using the second specious argument that the Referendum was "non-binding" (despite earlier National Ministers arguing, when introducing the CIR Act, that the process would call a halt to controversial legislation and force the Government of the day to rethink their policy.

At the time the law paving the way for citizens-initiated referendums was being debated, National MPs were confident that governments would take the results of referendums on board. 
And Sir Douglas Graham said in parliament in 1993,

“The Citizens Initiated Referenda Bill gives the freedom to engage the entire nation in any topic of our choosing... any Government that fails to respect the outcome of a non-binding referendum will have to convince us at the next general election that its decision was justified. It is my belief that we will rarely witness by Parliament the rejection of a referendum result.” 
and Murray McCully said,

"I am absolutely sure that the moral force of public determination by way of referendum will be enormous and overpowering as far as the Government is concerned." ....... Murray McCully's optimism has proved to be misplaced, however. 

The John, PinoKeyo, Key attitude to the NZ public and desire to preserve NZ assets from foreign asset strippers.

And so it has proved. The Key owned government has no regard for the democratic process as Key, with his "leader in waiting" mate, Joyce and his Lance-Corporal Ryall have decided that rather than follow the democratic process of waiting for the results of the referendum, required as a result of the successful petition, the asset stripping of the New Zealand state should be put on the front burner and proceeded with greater rapidity and, no doubt, increased carelessness and disregard of the economic and political consequences. (It appears that we should add Minister of Conservation: Nick Smith to this wall of infamy as well.)

The New Zealand Taxpayers and voters are now being given a clear demonstration of the arrogance that economic ignorance and a desire to drive the economy into an ideological cul de sac has reduced the government of New Zealand to.Key's attitude to the assets of New Zealanders is, however, in keeping with his constant use of the tax payers' money to prop up his corporate mates with "sweeteners" and in the back of the closet shonkey dealings so much a reflection of the practises of the money speculators responsible for the rise and collapse of the global finance industry.

Ideally, the opposition parties should simply scupper Key's fire sale of NZ assets by announcing that on coming to government the shares sold by Key and his cronies will be compulsorially repurchased at either the initial sale price or the current trading share price whichever is the lower - then waych as the asset strippers fold their wallets and cheque books and head back to raiding and stripping their mates rather than the taxpayers of NZ.

Joyce attacks Living Wage Pledge ...Key joins in.

Living Wage Pledges from Contenders for Labour Leadership attacked by National Party leadership.

The real reason why Joyce & Key don't want a living wage being paid to the workers who keep NZ afloat.

The campaign for a living wage heated up when, after David Shearer resigned from the leadership of the Labour Party, the main contenders for the role pledged support during their "hustings meetings" with Party members in the lead up to the membership vote.

Immediately the pledges became public the"Minister for everything Key can't deal with", Steven Joyce, launched into an all out attack on the policy and campaign calling such a campaign economic vandalism and irresponsible especially as the National_ACT govt had a plan to keep selling the country's assets off to foreign asset strippers which depended on keeping NZ as a low wage country.

Immediately after Joyce's pronouncement John Key, whose reputation as being trustworthy and truthful has come under intense scrutiny after the last Fairfax-Ipsos poll showed that NZers were increasingly disenchanted with his frequent brain fades and inability to be totally truthful about his dealings with foreign corporates, chimed in to add his increasingly strident voice to the attack. 

This Bruce the Barbarian cartoon sums up the Joyce-Key reaction to the Living Wage campaign and the support being given to it by Cunliffe, Robertson and Jones as they campaign for the leadership of the New Zealand Labour Party.

This cartoon may be dated but the response to the Living Wage campaign by Steven Joyce and PinoKeyo hasn't changed.

Has John Key lost his mojo?

Has PinoKeyo lost his mojo?

Key's distortions and misinformation over his badly drafted spy on NZers GCSB bill has added to his loss of Mojo.

Despite the razamattaz at the Rutherford Hotel over the weekend of the National Party Conference there were back room deals being made as the two major groups jockeying to unseat Key attempted to make sense of secret private polls taken to assess Key’s recent performance in The House and in front of the TV cameras and its impact on the credibility of the National-ACT government.

Our informant, C.L.Dodgson, revealed that the ABK group around Joyce and the ABC group around Collins (heavily and openly critical of Key and the Henry enquiry ) have had very similar poll results. Both indicating that Key is losing his mojo and credibility with the NZ public across the political spectrum.

Both camps are apparently cock a hoop with the results as they continue with their clandestine feuding and plotting to gain advantage when the opportunity arises to push the Crosby-Textor created “great manipulator” off and send him back to his residence in Hawaii.

The pollsters used by both camps were rumoured to have asked respondents to free associate all words they’d use to describe Key’s performance this year. When the results were presented to the ABK and ABC camps there was gob-smacked astonishment at the strongly negative word associations connected to brand Key.

Key's cold dead eyes have begun to lose their hypnotising powers.

Contrary to the perceived wisdom that Key is invulnerably popular with the public the pollsters apparently discovered a strong negative reaction to Key and his performance in The House and in public.

Our informant said that the common words to describe or be associated with Key by respondents across the political spectrum, were: slippery, devious, untruthful, insincere, arrogant, inefficient, bumbling, corrupt, doesn’t tell the truth- he only deals in half truths, indifferent, out of touch, disingenuous, false, hypocrite....... 

The shonkey deals over the SkyCity pokies for convention centre deal have added to Key's loss of mojo. Allegedly Poll respondents made frequent mention of this to the National-ACT pollsters.

Key's response to TV3 questioning and Alistar Thompson (Scoop) questions on the GCSB have further fueled the public disillusionment with Key. Much to delight of the ABC camp within the National_ACT party.

POST SCRIPT: The strategic National-ACT polling allegedly commissioned by the feuding camps within the party has been substantiated by the latest IPSOS-FAIRFAX political poll reported on the Stuff website (26.8.13) reports that John Key is not believed by the NZ voters. Extracts of reported comments about Key are, according to Vernon Small's story:

When respondents were probed for the reasons behind their views about Key some themes emerged, including that the pressure was getting to him, that he was coping - just - and that trust was slipping although he was doing well under pressure.
Typical negative comments included:
"I suspect the pressure he is under is making faults more obvious. I don't think there is a better opposition at this stage."
"Weak, always on the defence, and not very much on directions and purpose."
"The Tiwai smelter deal - John Key wants to keep that deal, which comes at a huge cost."
"Not as good as he has been, harder to trust him than it was. He doesn't appear as genuine as he once was." 

With growing reports of a growing disenchantment with the performance of Key we can obviously expect to see even more obvious jockeying for power as the dark closets within which the National-ACT party creates policy, decides who and which foreign corporates can buy influence and state assets and buys and sells its leadership begin to split open.

The response: Crosby-Textor push Key's panic button:
The decision,obviously made by Crosby-Textor advisers, that Key appear on the Campbell Live show to counter public suspicions about the GCSB legislation can be seen as an attempt to counter the polled perception of Key as being out of touch, arrogant and slippery. His performance, much praised by The Herald commentators, was a masterly demonstration of the aspects of his personality that the polling revealed was turning off the public - hectoring, ill informed, often providing false information and bland reassurances based on false analogy and incorrect interpretation. The suddenly announced, exclusive to the Herald, decision, by Key, to “clarify” his interpretation of the GCSB Bill and “Prime Ministerially” order the GCSB not to spy on New Zealanders unless it has the New Zealander’s permission and- of course- Key’s over riding authority to over-ride the necessity to obtain permission, was in response to the polling that revealed Key was not trusted to tell the truth on the issue.

While, too many of our readers, these may sound like the words one normally associates with the National Party - the ABC group around Collins, bouyed by her 11% popularity among the National Party supporters, have, apparently seized on these results and have begun an even more serious lobbying to gain ascendency over Joyce and his cronies as the internal feuding that has been long hidden in the closets of the National-ACT party begins to break into the open as the teflon, so carefully applied by Crosby-Textor to John PinoKeyo Key begins to flake off.

Sums it all up- Key is totally out of touch with NZ. There is no connect with Planet Key and reality.