Showing posts with label Inequality. Show all posts
Showing posts with label Inequality. Show all posts

Thursday, 9 April 2026

"The Greens are proposing one of the most aggressive tax regimes of its kind anywhere in the developed world..."

 

"The Greens are proposing one of the most aggressive tax regimes of its kind anywhere in the developed world, resulting in a broad-based raid on Kiwis who’ve worked hard, saved, and built something over a lifetime. 
"The idea this only hits the wealthy simply doesn't stack up. One in five Kiwi homes is held in a trust, and the Greens would tax those assets from the first dollar. In Auckland, that means an annual bill of over $18,000 on a mortgage-free family home, or $3,600 for first home buyers with a twenty-percent deposit.

"And it doesn't stop there. A 33 percent death tax would force many families to sell farms, homes, or businesses just to pay the bill. Inheriting the average dairy farm would trigger a $1.2 million tax bill. There is nothing fair about taxing grief, or taxing the same income again when it's earned, saved, and finally passed on.

"Most countries that have tried wealth taxes have scrapped them because they drive investment and talent offshore. Death taxes are even worse, New Zealand tried one and abandoned it in 1993 because it crushed farming families and raised almost nothing.

“This package is light on evidence, heavy on populism, and green with envy.”

~ Austin Ellingham-Banks on the Taxpayer Union's 'NEW REPORT: Green With Envy: Wealth, Death, And Trust Taxes Examined'
"One 'solution' to inequality ... is the wealth tax. ... This taxing away of capital means less means of production and thus less production and higher prices. At the same time, it means less demand for labour and thus lower wages. [The] programme is a call for mass impoverishment....
"Taxing wealth is not merely a levy on individuals but a direct seizure of the capital required for production, which ultimately harms everyone's standard of living. ...
"As [Ludwig Von] Mises observed* ...., almost all of the technological advances of the last centuries are available to and can be fully understood by engineers in even the most impoverished corners of the world. What stops the implementation of those advances is not any lack of technological knowledge but a lack of capital. Thus, a farmer in India who has seen a tractor on television can easily understand the value of using one. What stops him from using one is certainly not any lack of technological knowledge. It is certainly not that he does not know how to operate a tractor or could not easily be taught how to do so. What stops him is that he cannot afford a tractor. He does not possess the capital necessary to buy a tractor and cannot find a lender to provide it. This is a lack of capital that probably could not be made good by any rise in the local capital/income ratio. It reflects generations of insufficient local capital accumulation."
~ George Reisman from his comment on 'The Problem with the Wealth Tax' and his 'Piketty’s Capital: Wrong Theory/Destructive Program' [emphases mine]

"New Zealand’s productivity challenges are strongly linked to low capital intensity. ... New Zealand’s slowing labour productivity growth is likely to reflect both slowing growth in innovation and declines in the capital to labour ratio. ... New Zealand’s capital intensity [already] lags other countries...."
~ Treasury from their 2024 report 'Causes of New Zealand’s low capital intensity'

* Ludwig Von Mises, in his chapter 'Capital Supply & American Prosperity'--in which he observes that "the average standard of living is in [America] is higher than in any other country of the world, not because the American statesmen and politicians are superior to the foreign statesmen and politicians, but because the per-head quota of capital invested is in America higher than in other countries."

Friday, 27 March 2026

Inequality

In order to make people equal, you have to treat them differently. If you treat people alike, so far as government is concerned, the result is necessarily inequality.

"You can have either freedom and inequality, or unfreedom and equality.”
~ Friedrich Hayek

Wednesday, 11 March 2026

Thank you Adam Smith

It's a busy week. This week also marks the 250th anniversary of Adam Smith's Wealth of Nations, the first in-depth exploration and explanation of (in PJ O'Rourke's words) why some nations are prosperous and wealthy and other places just suck.In honour of the anniversary, here are several of Adam Smith’s most insightful observations:

It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our necessities but of their advantages. [The Wealth Of Nations, Book I, Chapter II]
It is the great multiplication of the productions of all the different arts, in consequence of the division of labour, which occasions, in a well-governed society, that universal opulence which extends itself to the lowest ranks of the people. [The Wealth Of Nations, Book I, Chapter I]
Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes, and a tolerable administration of justice: all the rest being brought about by the natural course of things. [Lecture in 1755, quoted in Dugald Stewart, Account Of The Life And Writings Of Adam Smith LLD, Section IV, 25]
It is the maxim of every prudent master of a family, never to attempt to make at home what it will cost him more to make than to buy. [The Wealth Of Nations, Book IV Chapter I]
By means of glasses, hotbeds, and hotwalls, very good grapes can be raised in Scotland, and very good wine too can be made of them at about thirty times the expense for which at least equally good can be brought from foreign countries. Would it be a reasonable law to prohibit the importation of all foreign wines, merely to encourage the making of claret and burgundy in Scotland? [The Wealth Of Nations, Book IV, Chapter II]
Consumption is the sole end and purpose of all production; and the interest of the producer ought to be attended to, only so far as it may be necessary for promoting that of the consumer. [The Wealth Of Nations, Book IV Chapter VIII]
People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices…. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies, much less to render them necessary. [The Wealth Of Nations, Book IV Chapter VIII]
To widen the market and to narrow the competition, is always the interest of the dealers…The proposal of any new law or regulation of commerce which comes from this order, ought always to be listened to with great precaution... It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it. [The Wealth Of Nations, Book I, Chapter XI]
It is the highest impertinence and presumption… in kings and ministers, to pretend to watch over the economy of private people, and to restrain their expense... They are themselves always, and without any exception, the greatest spendthrifts in the society. [The Wealth Of Nations, Book II, Chapter III]
There is no art which one government sooner learns of another than that of draining money from the pockets of the people. [The Wealth Of Nations, Book V Chapter II Part II] 
Every individual... neither intends to promote the public interest, nor knows how much he is promoting it... he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.
    Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good.
[The Wealth Of Nations, Book IV, Chapter II]
What improves the circumstances of the greater part can never be regarded as an inconveniency to the whole. No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable. [The Wealth Of Nations, Book I Chapter VIII]
Mercy to the guilty is cruelty to the innocent. [From his 1759 work, The Theory of Moral Sentiments]
The man of system…is apt to be very wise in his own conceit; and is often so enamoured with the supposed beauty of his own ideal plan of government, that he cannot suffer the smallest deviation from any part of it… He seems to imagine that he can arrange the different members of a great society with as much ease as the hand arranges the different pieces upon a chess-board. He does not consider that in the great chess-board of human society, every single piece has a principle of motion of its own, altogether different from that which the legislature might choose to impress upon it. [The Theory Of Moral Sentiments, Part VI, Section II, Chapter II]





Wednesday, 4 March 2026

"The real battle of our time is a cultural one, is a philosophical one, is a moral one."

"There are moments in history when a civilisation must choose its future.

"We have been told that the State is our protector; that bureaucrats are our saviour, and that politicians know more than the free man. That we must obey, that we must depend. 

"But the truth is different. 

"The world only has two types of people: those who live off what others produce, and those who produce everything that makes modern life possible. 

"The former draft regulations, the latter create wealth. The former promise [to equalise everyone], the latter generate prosperity. The former spread poverty, the latter multiply abundance. 

"The real battle of our time is a cultural one, is a philosophical one, is a moral one. 

"That's why we chose the system that lifted millions out of extreme poverty: free-market capitalism. 
"Because you don’t negotiate freedom, you defend freedom." 
~ Argentine President Javier Milei from his inauguration speech 'Moral Values as State Policy'

Thursday, 19 February 2026

"Is the concept of personal responsibility foreign to Maori? I don’t believe it is.

"The latest 'Salvation Army State of the Nation Report 2026' presents a litany of excuses for the sorry state of New Zealand’s social statistics, in particular, those relating to Maori. ...
"'The over representation of Māori tamariki and rangatahi in state care [is said to] reflect ... the enduring impacts of colonisation and breaches of Te Tiriti o Waitangi ... disproportionate inequities are due to current systems and the lasting impacts of colonisation ... and institutional racism...'
    '[T]angata whenua experiencing housing insecurity or homelessness, ... disrupts connections to te ao Māori and limits the ability to exercise tino rangatiratanga. ...'
    'Colonial policies, land alienation and the imposition of state justice systems that do not represent partnership have had long‑lasting effects that continue to shape Māori experiences in the criminal justice system today.' ...
"The [report's] 'Maori lens' response run to pages. ... 
"[I]s the concept of personal responsibility foreign to Maori? I don’t believe it is. ...

"In the face of this report the best response the government could make is to defund the Salvation Army for being part of the problem."
~ Lindsay Mitchell from her post 'A litany of excuses'

Thursday, 20 November 2025

Should we end capitalism? Or embrace it.

"Capitalism ... has been, blamed for various ills, from poverty and income inequality to pollution, inflation, child labour, and war. ... Capitalism is misunderstood because it is often confused with today’s mixed economy that combines varying degrees of economic freedom and statism. Statism gives the government unlimited power that it uses to tax, regulate, and subsidize individuals and businesses and to hand out favors (government contracts, lower tax rates, subsidies) to companies that make political contributions and do the government’s bidding.

"Because of this confusion, people blame capitalism for problems caused by the mixed economy and statism in particular.

"Consider poverty and income equality. Poverty is most persistent in countries where the government deters wealth creation through high levels of market controls, taxation, and corruption that constrain economic growth, entrepreneurship, job opportunities, and people’s ability to work themselves out of poverty and improve their incomes. The same can be said of child labour (a consequence of poverty), inflation (caused by government manipulation of the money supply, not by business seeking to maximise profits in a free market), and war (caused by government invasion of another country).

"Capitalism does not cause the problems it is blamed for but provides solutions by safeguarding freedom. ...

"In Ayn Rand’s definition, “capitalism is a social system based on the recognition of individual rights, including property rights, in which all property is privately owned.” In such a system, the government’s role is limited to protecting individual freedom ... by deterring and punishing the initiation of physical force against others ... Under capitalism, the only way to get others to collaborate is through persuasion and voluntary trade.

"Although pure laissez-faire capitalism has never fully existed ... some historical periods and countries have approximated capitalism ... [Northern] America during the 19th century (the longest uninterrupted period of peace); England, France, and other European countries during the Enlightenment (that brought about the Industrial Revolution); Hong Kong (before China’s takeover); and smaller countries like Estonia (that liberalised their economies after the collapse of the Soviet Union).

"Capitalism is good for people and their environment because it produces and protects freedom, the social condition that human flourishing requires. ... [C]apitalism did not create today’s problems but has helped solve or reduce them. ...

"If we want human flourishing to increase, we must not reject and banish capitalism but embrace and defend it ... "
~ Jaana Woiceshyn from her post 'Should we end capitalism?'

Wednesday, 22 October 2025

Pay no attention to the (mad) men behind the curtain [updated]


Readers here might remember I got some stick for calling John Key a fucking moron a while back. A fucking moron, specifically, for repeated calls for the Reserve Bank to juice up house prices again, just so home-owning voters will feel better again. Feel better again, and then vote National.

"The guts of what’s wrong," explained the moron, "is that the housing market is going down, not up" — and "then you have a negative wealth effect," and voters feel bad. And when they feel bad, they vote for the other team.

Classic short-termism.  Stuff rocket fuel into the economy, and then all things will be jake for the governing political parties. This, by the way, was Key's "one simple trick" while Prime Minister: ensure massive house-price inflation, no matter the economic and social dislocation, and then sit back and watch home-owners fooled into feeling better off, and borrowing and consuming more, regardless of the economic consequences. (Consequences for which we're all still paying, by the way.)

In the US, the discredited "wealth effect" — "a gussied-up version of Keynesian stimulus, only targeted at the prosperous classes rather than the government’s client classes" — is generally felt in the stock market. Pundits there are starting to get nervous about a soaring stock market with anaemic growth in the economic system itself, with "important implications for the path of America’s stockmarket boom and its economy."
The good times could continue, at least for a bit longer [says 'The Economist']. ... [But] might a wealthier society also take a harder fall? Bears would point to the bursting of the dotcom bubble in 2000, when a brutal stockmarket slump pushed America into recession. ... The stockmarket might be more of the economy. It still is not all of it.
It's not. And nor is the housing market. We can't get rich just by selling each other houses. (And kudos to one National minister at least who understands that.)

Yet David Stockman is concerned that nothing has been learned from the last major crash
Roughly 15 years ago it was reasonably well understood that the Great Financial Crisis of 2008-2009 had been case of speculation run amuck on both Wall Street and main street alike. These credit and housing bubbles, in turn, had been fuelled by the massive money-printing sprees of the Greenspan and Bernanke Fed.

It might have been presumed, therefore, that the mad money-printers [at the US central bank] would have had second thoughts about the underlying cause of these great economic disasters—that is, the dubious Greenspan policy known as the “wealth effects” doctrine. In simple terms the latter held that if people felt richer owing to soaring home prices and their stock market winnings, they would spend more freely and fulsomely, thereby goosing the Keynesian cycle of ever more spending-sales-production-income-and spending, which was to be rinsed and repeated in an endless round of rising prosperity.

At the end of the day, of course, Greenspan and his heirs and assigns at the Fed turned out to be unreconstructed Keynesians and the wealth effects doctrine a monumental economic con job. The latter did not make society richer; it just made the rich richer. Or stated more directly, main street got inflation at the grocery store, gas pump and doctor’s office—even as the asset-holding class experienced unspeakable windfalls in their brokerage accounts.
Let's not repeat the same mistake again here — especially when local interest rates are already below our trading partners, with no noticeable effect on genuine economic progress. Please: pay no attention to the mad men behind the curtain.

UPDATE:
"The advocates of annual increases in the quantity of money never mention the fact that for all those who do not get a share of the newly created additional quantity of money, the government's action means a drop in their purchasing power which forces them to restrict their consumption. It is ignorance of this fundamental fact that induces various authors of economic books and articles to suggest a yearly increase of money without realising that such a measure necessarily brings about an undesirable impoverishment of a great part, even the majority, of the population."
~ Ludwig von Mises from an interview 'On Current Monetary Problems'

Friday, 29 August 2025

"Real justice means more than equal treatment," apparently

"Labour’s Māori Labour’s Māori caucus fully intends to regain the dominant influence it had during the Ardern-Hipkins government of 2017-23. ...

"[W]hether ... pushback is even possible for [Hipkins] remains moot given it has been observed that [he] can only hang onto the leadership as long as he has the support of his Māori MPs. ...

"Journalists don’t ask Hipkins very often about Labour’s dedication to co-governance and the Treaty as a 'partnership' but it is certain to become an area of contention in the 14 months until the election no matter how much Hipkins wants to avoid it. Particularly, of course, if Peeni Henare and his fellow Māori MPs publicly advocate for it. ...

"Henare’s pledges to electors in the Tāmaki Makaurau seat have been described by some commentators as 'radical.' While that is true, it is equally true they simply represent the same radical policies Ardern and her Māori caucus foisted on an unsuspecting public after Labour gained an outright majority in 2020." 
~ Graham Adams from his post 'By-election puts co-governance in spotlight'
Meanwhile ...
"Human rights law is being used in Aotearoa New Zealand to block Māori aspirations, according to new research by Auckland Law School Associate Professor Andrew Erueti ... Erueti contrasts two competing models for understanding Indigenous rights: a liberal model, based on equal treatment under the law, which tends to limit Māori authority; and a decolonisation model, which recognises that Māori held political authority long before the state existed.

"'And that self-determination means restoring that authority on Māori terms,' he adds. ... 'Real justice means more than equal treatment' ..."

~ from the Auckland University puff piece 'Human rights used to limit Māori governance - academic'

Saturday, 14 June 2025

Let’s call ‘taxing the rich’ what it really is: Theft

Picture of New Zealand's richest man. Guaranteed a reaction
 against his success by a certain sort of commentator ...

EVERY SO OFTEN A PIECE of dross comes over my monitor that just cries out to be fisked. Like this rant against the latest NBR Rich List by someone called Dr Neal Curtis. His piece argues that "as society groans under the weight of wealth inequality" (can you hear the groans, readers?) there should be a "different slogan to ‘tax the rich'." The one he favours: "reclaim the wealth'."

Yes, he's an ultra-redistributionist. Aka, a thief. Walter Williams knows the type:

Dr Curtis's piece is of course a reaction to publication of the NBR Rich List, which without fail gets a certain sort of person to hyperventilate.

Dr Curtis is that sort of person.

And this screed vomiting forth at Newsroom is the result.

Dr Curtis, by the way, is said by his bio to be "a comics scholar and critical theorist with wide-ranging interests." Lead item on his Areas of Expertise is: Comics. So let's just call him Mr Curtis.

MR CURTIS BGINS: THIS Government, he says, is "gutting government departments and cutting public services."

I wish this were true instead of comical. (Spending is now higher under Nicola Willis than under Grant Robertson. Full-time employees under the Luxon Government was 64,222 when elected, and is now 63,238. There have been cuts, it's true, but none anywhere near as big as I would hope.)

But his beginning is only a drive-by to pass off his credentials. Three paragraphs in we get to the meat. So it's here that I'll begin my fisking.

MR CURTIS: [There are] three central assumptions of current economic dogma that those who question are branded as ‘radical leftists.’ These assumptions are underpinned by the beliefs that wealth trickles down; deregulation is good for business; and the state should stay out of the market and everything should be privatised.

Should I cry "strawman" this early in the piece? Each of these pieces of alleged dogma is both fly-blown and overblown. No-one outside a piss-poor public-choice lecture would anyone say everything should be privatised. (Courts? Police? Army?) And no-one anywhere advocates so-called "trickle-down." His point here is not to make sense, however, it's simply to damn the rich so he can later advocate their being eaten.

So he ploughs on regardless, challenging each of the assertions he's just straw-manned. Like his logic, let's looks at each of them in reverse.

MR CURTIS: ...the state has always been an economic entrepreneur funding all kinds of technological innovation, such as the internet, but this often goes unreported in the dominant economic journalism.

"Always" is doing a lot of work here. There's a reason so much government entrepreneurialism goes unreported in any economic journalism: it's because it's so rare. Sure, the government defence project ARPANET linking dozens of people was transformed into something that now links five billion. But that wasn't a Ministry of Doing Shit that did that. It was private entrepreneurs who turned the great idea into a GREAT IDEA. 

MR CURTIS: ... seen from a purely corporate perspective deregulation is no doubt a path to profit. However, it is also socially disastrous as costs of deregulation are outsourced via public bailouts following financial crises, for example, that are directly caused by the rolling back of legislation designed to safeguard the wider economy.

Without going too much further than this one paragraph (though we can if you wish), let us agree that there is more than one kind of deregulation. There is the kind that mandates safety and (may) safeguard the wider economy. There is regulation that protects intellectual and real property, and that allows for the enforcement of contracts. And then there is regulation about how curved a banana should be, or how far apart hairdressing salon seats should be. You'll notice how carefully Mr Curtis conflates these. And why.

MR CURTIS: ... wealth, especially when given away in tax cuts, does not trickle down. It stays at the top. Ever-increasing wealth inequality as measured by the Gini coefficient or any study of income trends show this.

Now, it's Mr Curtis who insists this to be economic dogma, i.e., that wealth "trickles down." Yet the author of Basic Economics,  Thomas Sowell, insists that there is no-one anywhere outside a lunatic asylum or a comics convention who holds it to be true, let alone as dogma.
Years ago [writes Sowell, I] challenged anybody to quote any economist outside of an insane asylum who had ever advocated this “trickle-down” theory. Some readers said that somebody said that somebody else had advocated a “trickle-down” policy. They could never name that somebody else and quote them, though.

[Mr Curtis] is by no means the first [person] to denounce this nonexistent theory. Back in 2008, presidential candidate Barack Obama attacked what he called “an economic philosophy” that “says we should give more and more to those with the most and hope that prosperity trickles down to everyone else.”

Let’s do something completely unexpected: Let’s stop and think. Why would anyone advocate that we “give” something to A in hopes that it would trickle down to B? Why in the world would any sane person not give it to B and cut out the middleman? All this is moot, however, because there was no trickle-down theory about giving something to anybody in the first place. 

Sowell wrote a whole book exposing the nonsense of those who believe this trickle-down fantasy. [It's free, you can DOWNLOAD IT HERE.] And as I've pointed out myself on occasion, if there is a trickle-down system in operation it's the one whereby large gobs of your own money are taken from you by government, and trickled back down to you in the form of favours, and subsidies and social welfare for working families and the like.

There is an argument however for having capitalists keep their own capital, however— an economic argument, as well as the strictly-speaking moral argument that it's their goddamn money. Mr Curtis et al would like to think that if the "one percent's" capital were not stripped from them it would perhaps be baked into pies or used to light cigars—or would be emptied into money bins so that, like Scrooge McDuck, the owner of capital can spend his time rolling around in it.

This is truly a comic-book version of reality that only one ignorant of the division of labour could hold. 

Because, as George Reisman explains,  the vast majority of the wealth owned by the so-called “one-percent” is not held in the form of chocolate bars or champagne bottles or pies, but in the form of the capital goods and equipment that produce the consumer goods on which we (and Mr Curtis) all depend—capital goods that only come to represent wealth to the extent they are used to produce the goods and services people, in their capacity as consumers, really want. Per-Olof Samuelsson observes
"The productive rich (think Rockefeller, Carnegie, Ford, Bill Gates, Steve Jobs, etcetera, etcetera) actually flood the rest of us with wealth (and themselves become wealthy in the process). Taxing or expropriating them simply means to dam this flood. And this may make it appear 'trickle-down'— because governments and politicians will only allow a small portion of this wealth to trickle down to us; the rest of it lands in their own pockets."
Many of the wealthiest people on earth hold their wealth in the form of a financial asset, like stock in a successful company. And the very wealthiest have no time to swim in cartoon-style money bins because they're also successfully running these companies.
[Mr Curtis and his readers] have no awareness of this, because they see the world through an intellectual lens that is inappropriate to life under capitalism and its market economy. They see a world, still present in some places, and present everywhere a few centuries ago, of self-sufficient farm families, each producing for its own consumption and having no essential connection to markets.
    In such a world, if one sees a farmer’s field, or his barn, or plough, or draft animals, and asks who do these means of production serve, the answer is the farmer and his family, and no one else. In such a world, apart from the receipt of occasional charity from the owners, those who are not owners of means of production cannot benefit from means of production unless and until they themselves somehow become owners of means of production. They cannot benefit from other people’s means of production except by inheriting them or by seizing them.
But in the modern world (at least, to the extent that the so-called “one-percent” are not simply milking government subsidies and bailouts, which is how so many seem to think business should work), all of us benefit from the private ownership of their means of production whoever owns them—just as long as the owners are left free to produce and innovate. We all get the benefit of their production, both as buyers of the products of those means of production, but also as sellers of labour employed to work with those means of production.
The wealth of the capitalists, in other words, is the source both of the supply of products that non-owners of the means of production buy and of the demand for the labour that non-owners of the means of production sell. It follows that the larger the number and greater the wealth of the capitalists, the greater is both the supply of products and the demand for labor, and thus the lower are prices and the higher are wages, i.e., the higher is the standard of living of everyone. Nothing is more to the self-interest of the average person than to live in a society that is filled with multi-billionaire capitalists and their corporations, all busy using their vast wealth to produce the products he buys and to compete for the labour he sells.
    Nevertheless, the world [
Mr Curtis and his readers] yearn for is a world from which the billionaire capitalists and their corporations have been banished, replaced by small, poor producers, who would not be significantly richer than they themselves are, which is to say, impoverished. They expect that in a world of such producers, producers who lack the capital required to produce very much of anything, let alone carry on the mass production of the technologically advanced products of modern capitalism, they will somehow be economically better off than they are now. Obviously, [they] could not be more deluded.

AND IT'S NOW, WITH HIS three dogmas exposed, that we can see Mr Curtis's error more plainly. Like many who are branded as "radical leftists," not only is there an inherent wish to damn the rich, all of them, there is also a paucity of understanding of how the deserving rich got that way. 

Yes, there is more than one way to get rich. One may pull favours and subsidies from government, as cronies all try to, or one may be the government and sell Shitcoins (as one particularly egregious entity is currently doing). Or one may sit tight and rely on central banks inflating monetary assets (what is often called the Cantillon Effect, after the eighteenth-century ex-banker who called attention to this phenomenon of long-term capital consumption). But neither of those examples is any more than short-term, and no amount of short-term skimming is going to get you to the top of even a New Zealand rich list.

Even in this small pond, it does take an entrepreneur risking his or her own capital to really roll in the big returns.

Mr Curtis would like you to conflate all three, as he proceeds to draw his conclusion.

But first, his corollary: that it is government spending that makes us all rich. Mr Curtis phrases it this way.

MR CURTIS: All this [leaving capital in the hands of its owners] results in top-heavy, financially starved economies as governments continually try to make the wealth giveaways fit into a budget by stripping support for public services or selling off public assets at knockdown prices. ...
    The fact that the global economic outlook as well as specific national economies remain so fragile and unstable ... is surely enough evidence that the principle of continually moving wealth upwards doesn’t work...

He really does think that money in the hands of government grows economies, whereas money in the hands of those who made it simply squanders it. 

It's deluded.

And sure enough, having made his three points of alleged dogma, and delivered his corollary, he gets to start eating his meat. 

MR CURTIS: Just as there is no economic justification for structuring an economy in which only the very wealthy are the true beneficiaries, there is also no moral justification.... As our society is placed under increased stresses and strains beneath the extreme weight of amassed, socially useless wealth that sits with a very small class of people, there have been increased calls to tax the rich.
Mr Curtis is, of course, in favour. And now, bringing together what passes for his argument, is his payoff:
MR CURTIS: Instead of a call to ‘tax the rich’, the call should be to ‘reclaim the wealth’. I believe this phrase more adequately represents the request to return a greater share of what was commonly created. It is also a call to give back even just a small amount of what was taken through the design of an economy knowingly and carefully organised to purposefully benefit the few.

You can see his own dogma peering out from under his comical version of how an economic system works:

"Commonly created."

"Give back."

"Reclaim."

One question should be enough to puncture the deceit, and with it we return to Walter Williams at the top of this post. The question is: Who created this wealth?

Nick Mowbray is an almost perfect example here. 

The wealth represented by Mr Mowbray's Zuru Toys quite literally did not exist before Mr Mowbray created Zuru's toys. Pre-Mowbray, there was a pile of stuff. Post-Mowbray and his identification of the value to human beings to be delivered by his toys, there's enough value in them to make him this county's richest man.

I know that can be hard to get your head around, but there it is. Value, in the economic sense, is in the eye of the consumer. Consumers' "vote" every day, with their own hard-earned money on their devices, for Zuru's toys creates a socially-objective price for Mr Mowbray's offerings, and allows him to grow his capital. Which he can then use to create more toys, which creates more capital, which .....

All going well, especially if you like children's toys, that's a life-enhancing spiral that costs no-one else anything.

LET'S NOT BOTHER TOO MUCH to investigate further into the mind of someone who would despise that.

Let's ask instead only what they're trying to achieve. For. Mr Curtis, here's his payoff here, he hopes (now with an added noteto identify his errors:

MR CURTIS: As our society is placed under increased stresses and strains beneath the extreme weight of amassed, socially useless wealth [sic] that sits with a very small class of people, there have been increased calls to tax the rich.

I love the use of the passive verb: "there have been calls..." instead of "I and my colleagues have been demanding..." 

MR CURTIS: In keeping with the dogma [sic], conservative supporters have made tax a dirty word [I wish! -Ed.]. Rather than tax being an individual or corporate contribution to the maintenance of a functioning society, the corporatist right has over the past four decades tried to make it a synonym for theft [I wish - Ed.]. The idea that taxing the rich is really a form of theft also makes it easy for the dogmatists [sic] to present the call as a form of envy; a petty resentment of the successful.
And isn't it envy? Envy, for example, that one person making toys that delight people will earn more in his lifetime than someone with pretensions to intelligence making his living from analysing comic books and posting snide articles on a web page. The envy fair oozes out this piece, and other similar rants by the usual suspects.
MR CURTIS: Instead of a call to ‘tax the rich’, the call should be to ‘reclaim the wealth.

Ah. Here we go: an all-but explicit claim from the mire that "you didn't build that." Which in the next sentence is made explicit:

MR CURTIS: I believe this phrase more adequately represents the request to return a greater share of what was commonly created.

So, in what will no doubt be a surprise to Messrs Mowbray, Hart et al, everybody created the toys for which the world is clamouring, the companies made more efficient, the plastics that store food better, the films that folk queue up for ... We all did it, he claims.

In the end, after all the verbage, that's his major claim. That we made it—an absurdity—so therefore we should keep it. A nonsense.

It is also a call to give back [sic] even just a small amount of what was taken [sic] through the design of an economy knowingly and carefully organised to purposefully benefit the few.
The irony is that, if Mr Curtis lifted his head from his comic books and looked properly at the world around him and at the division-of-labour system that allows even sad sacks like himself to survive and even flourish, he'd understand that (even imperfectly) it already is benefitting all of us.

If there's one benefit of watching a US president tearing down everything that made his own country prosperous, it's that his many political enemies are slowly discovering this truth.  

Many are discovering anew that it is actually poverty that is mankind’s natural state, that it is past wealth production (not redistribution) that has been rescuing people from poverty worldwide in ever-expanding numbers—the great (but almost unheard) story of our era that allows today's worker more easily-available health, wealth, and luxuries than even a king enjoyed in all previous centuries—and that efforts to simply legislate higher wages by law amounts to little more than a “loot and plunder” approach to economics.

The fundamental policy tools of statist politicians [explains George Reisman] are clubs, guns, and prisons... What allows statist politicians to conceal the fact that they’re thugs is the belief that they have a special account with Santa Claus. As though Santa Claus, rather than extortion, were the source of the funds extorted by the politicians.
The statist politicians and the leftist “intellectuals” dismiss the teachings of sound economics by calling it “trickle down.” They do not allow themselves to see that their theory of economics is the loot and plunder theory.
Some have realised and reconsidered. I invite Mr Curtis to consider it too.

PS: Mr and Mrs Marx were at least fully aware of how envy towards the rich is a psychological problem, not an philosophical—or economic—one. Writing to their "embittered" son after yet another tantrum at the world, Heinrich Marx said:
Frankly speaking, my dear Karl, I do not like this modern word, which all weaklings use to cloak their feelings when they quarrel with the world because they do not possess, without labour or trouble, well-furnished palaces with vast sums of money and elegant carriages. This embitterment disgusts me and you are the last person from whom I would expect it. What grounds can you have for it? Has not everything smiled on you ever since your cradle? Has not nature endowed you with magnificent talents? Have not your parents lavished affection on you? Have you ever up to now been unable to satisfy your reasonable wishes? And have you not carried away in the most incomprehensible fashion the heart of a girl whom thousands envy you? Yet the first untoward event, the first disappointed wish, evokes embitterment! Is that strength? Is that a manly character?

Is it? 

Friday, 16 May 2025

"The Greens’ Budget is more than just a Budget. It is their utopian vision for a different country."

"[T]he Greens’ ... 'Green Budget' ... is more than just a Budget. It is their utopian vision for a different country. Unfortunately, it is also based on ludicrous assumptions and bad economics. ...

"The cornerstone of the Green revenue plan is a wealth tax raising $72.5 billion over four years. That is, well, optimistic. Just ask Germany, France and Sweden why they abandoned similar taxes. The reasons were capital flight, tax avoidance and administrative nightmares. ...

"Their plans for universal dental care ...is magical thinking, not policy. ...

"Their public housing plans ... offer no realistic plan for quadrupling construction capacity in a sector already facing severe workforce shortages and supply chain constraints.

"Their $395 weekly Income Guarantee ignores inevitable [inflationary] market responses. ... [guaranteeing] a return to similar inequality but with vastly higher government spending.

"The Greens have presented us with a textbook case of utopian thinking. And not coincidentally, 'utopia' literally means 'a place that does not exist'.”
~ Oliver Hartwich from his post ' The Green Budget fantasy'

Tuesday, 11 February 2025

Friedrich Hayek on equal opportunity vs equal outcome


"The classical demand is that the state ought to treat all people equally in spite of the fact that they are very unequal. You can’t deduce from this that because people are unequal you ought to treat them unequally in order to make them equal. And that’s what social justice amounts to. It’s a demand that the state should treat people differently in order to place them in the same position. . . .To make people equal a goal of governmental policy would force government to treat people very unequally indeed. ...
    “In order to make people equal, you have to treat them differently. If you treat people alike, the result is necessarily inequality.
    “You can have either freedom and inequality, or un-freedom and equality.”

~ Friedrich Hayek interviewed by William Buckley & Jeff Greenfield

 

Wednesday, 22 January 2025

"... It is extraordinary that needs to be said, but equality is not racist."


"The Treaty Principles Bill has done exactly what its champion, David Seymour, intended – it has sparked a national conversation. And that conversation has been eye-opening to say the least. Never could I have ever predicted that ‘equality’ would be treated as ... a dirty word.
    "The immortal words of Dr Martin Luther King Junior’s 'I have a dream' speech, treasured for decades after his death, are now out of fashion according to certain sections of our society and Nelson Mandela would today perhaps be condemned for the ideals he said he would die for:
    '… the ideal of a democratic and free society in which all persons live together in harmony and with equal opportunities.'
"... It is extraordinary that needs to be said, but equality is not racist."
~ Don Brash from his post 'Equality is not a dirty word'

Saturday, 18 January 2025

"Capitalism is indeed remorseless, but in distributing economic advantage."



"[Michael Ingatieff complains] as if it’s a fact too obvious to question, of 'capitalism’s remorseless distribution of economic disadvantage.'
    "What in the world is he talking about?
    "Ordinary [folk around the world], even ones in lower-income brackets, today live in air-conditioned homes, drive air-conditioned automobiles, carry electronic devices that stream music and videos and enable real-time conversations – in voice or in text – with people literally on the other side of the globe. Nearly all of us regularly fly through the air to distant locations, have closets full of clothes and amazing appliances and detergents to keep those clothes clean, spend lower and lower shares of our disposable incomes on food as the quality and variety of that food increase (fresh blueberries in January in New York would have astonished J.D. Rockefeller), enjoy health care undreamed of by J.P. Morgan, and have life expectancy at birth more than double what it was for most of humanity’s existence.
    "Indeed, our pets eat better than did most of our forebears, and even our inanimate stuff is more comfortably and securely accommodated than they were.
    "These and many other ordinary experiences of modern life are so routine that we take them for granted, yet each and every one would have astounded the richest monarch or pooh-bah before the capitalist era. And each one is the product of innovative, entrepreneurial capitalism. Capitalism is indeed remorseless, but in distributing economic advantage."

Tuesday, 19 November 2024

"It has only just been revealed that the judiciary invented their own set of Treaty Principles..."


"The Treaty Debate is great. We've just found out, courtesy of our King's Counsels, what has broken the economic back of this nation. It has only just been revealed, thanks to their letter to the PM, that the judiciary invented their own set of Treaty Principles. ...
    "Most of us had heard about the 'principles' before, but until the Treaty Debate was opened recently, we had no idea that they were so embedded [by lawyers and judges] into our Constitutional arrangements.
    "Many countries have affirmative action programs. However I know of no country that has [embedded within it] a constitutional requirement of 'outcomes,' not opportunities, being equalised amongst the citizenry, other than maybe a few Communist States that failed & no longer exist. ...
    "[O]ur Judiciary seem not have the foggiest idea of the practicalities of the problem. Once you put equitable outcomes, not opportunities, in a Constitution, you're requiring governments to raise massive tax revenues to achieve equalisation. You're shifting taxation powers from elected officials to judges. Let's at least be grateful to our King's Counsels for explaining why NZ's standard of living has been falling, harming the livelihoods of all ethnicities."

~ Robert MacCulloch from his post 'Now We Know how NZ's economy became broken: The Judiciary wrote a Communist-style Constitution without Consultation; without People Knowing.'

Thursday, 26 September 2024

Treaty Principles: Unequal + Divisive?


"Reasons both for and against the Bill to define the Treaty's principles vary in their worth.
    "One of the worst against it is that it will cause division.
    "Those who use this as a reason to kill the Bill are either in ignorance of, or ignoring, the division that already exists over the rights and wrongs of Māori rights and the disquiet over the way the principles, which are undefined, have crept into legislation and practice in all levels of government, the public service and private organisations.
    "Stopping debate because there is division won’t stop the division, it will make it worse."
~ Ele Ludemann, from her post 'Stopping debate won’t stop division'
"The original intention of the ACT Bill was to assert three basic principles, which can be derived from the original Treaty:
  • The New Zealand government has the right to govern New Zealand.
  • The New Zealand government will protect all New Zealanders’ authority over their land and other property
  • All New Zealanders are equal under the law, with the same rights and duties.
But those who profit from the Waitangi Tribunal could not have remained employed and in power for 49 years if that task was so simple ... The danger was soon evident. ... The suggested second principle [became]: 
'The New Zealand Government will honour all New Zealanders in the chieftainship of their land and all their property.'
    "The first version spoke of equality; this rewritten text makes a claim for separation and superior Māori rights ...
    "That rather strange version of property rights has, since the above was written, taken another step away from universality. The second principle has [now] become (11 September 2024): 
'Rights of Hapu and Iwi Māori: The Crown recognises the rights that hapu and iwi had when they signed the Treaty. The Crown will respect and protect those rights. Those rights differ from the rights everyone has a reasonable expectation to enjoy only when they are specified in legislation, Treaty settlements, or other agreement with the Crown.'
"This [version] insists on special rights defined by race. The Bill has been destroyed, and the promise to the New Zealand people has been betrayed. ...
    "The country grows crazier with each new year. We have been living in [George Orwell's] Animal Farm for too long. When the pigs strut about and proclaim that 'All animals are equal, but some are more equal than others,' our only response must be – don’t be so silly."
~ John Robinson from his article 'Just Equality: The simple path from confusion to common sense.' [Emphases in Robinson's original]

Wednesday, 28 August 2024

NZ's govt health 'system': "delivering equally awful health-care to everyone"


"Enough is enough. Former PMs Helen Clark and Jacinda Ardern should come clean about how they were the Chief Architects of the omni-shambles that has become our health system. ... for the folks who suffer from long waiting lists and declining health-care quality, some of whom didn't make it. 
    "The person who wrote the report [that is] the inspiration behind the disaster that is Health NZ was Heather Simpson, Clark's Chief of Staff for 9 years ... reincarnated by Labour to advise Ardern and Hipkins on health-care. ... The report was the inspiration behind the [disastrous] centralisation of NZ's health system. ...
    "I read the report. No intellectual basis is built for its suggested re-design of health-care delivery. No wonder our system is failing. 
    "It keeps repeating the word 'equity,' seemingly in the hope that by writing that word on paper is enough to deliver it in practice. The report bizarrely repeats 'equity' 219 times (!?) By contrast, the word 'competition,' which is a requirement to ensure quality and efficiency in nearly every economic system, is not mentioned one time. The report thereby seeks to deliver equally awful health-care to everyone."
    "... [The report's] half-baked idea is that the monolithic super-structure it invents ... would create 'economies of scale.' It uses the jargon, 'scaling up.' Health NZ has succeeded only at being a large scale disaster."

 

Wednesday, 12 June 2024

Thieving scum

 

Twenty-three parasites. (Back pockets not pictured.) [PIC: Dom Post]

Go on, when you read the headline you already had a fair idea about whom this would be.

Yes, readers: politicians.

A person with a smile painted on at the front and a bulging back pocket in behind.

Thieving scum.

A fair proportion of whom are taking your money to stay in their own Wellington home:

DOM POST: Twenty-three MPs are claiming an allowance [sic] of between $34,000 and $52,000 [per annum] to stay in their own Wellington homes, a perk that sees the taxpayer help politicians pay off their mortgages.

Nice. I'm sure to most of these entities that kind of money is the sort of chump change that fills up the back of the couch; but there's many a taxpayer who would that like that kind of money back to pay their own goddamned mortgage. 

Dom Post reports the scum includes "six National Party ministers, the Speaker Gerry Brownlee and deputy speaker Barbara Kuriger [who] claim the capped allowance to [supposedly] cover living costs in the city," poor lambs. "They then use it," says the Dom Post, "to pay rent on property they already own. Seven Labour MPs and two from ACT are also receiving up to $34,000 a year, the maximum paid to backbenchers." 

Yes folks, the entitle-itis is parliament-wide. The Dom Post names the roll call of thieving scum to be these:

ACT
Simon Court
Todd Stephenson
NATIONAL
Mark Mitchell
Melissa Lee
Louise Upston
Stuart Smith
Barbara Kuriger
David MacLeod
Tim Costley
Paul Goldsmith
Judith Collins
Catherine Wedd
Andrew Bayley
Vanessa Weenink
Paul Garcia
Gerry Brownlee
LABOUR
Keiran McAnulty
Willie Jackson
Duncan Webb
Arena Williams
Jan Tinetti
Jenny Salesa
Deborah Russell
As the Post wryly notes, "Many of these MPs have extensive property portfolios."

Some of these parasites have form already, claiming large "expenses" and the accommodation allowance, including ACT's big-spending Todd Stephenson and National's Judith Collins and Louise Upston; and Labour's Willy Jackson, Jan Tinetti, Deborah Russell, Jenny Salesa, Arena Williams and Duncan Webb are all there again, treating the taxpayer as an ATM machine. (This attitude is truly everywhere, isn't it.)

Scum. 

Every.Single.One.Of.Them.

Sunday, 5 May 2024

Bastiat’s Buildings: "But will unplanned development be *beautiful*?"




Why are housing prices so high? 'Supply and demand' is true but misleading, because draconian regulation drastically constricts housing supply. In his exciting new nonfiction graphic novel, economist Bryan Caplan makes the economic and philosophical case for radical deregulation of the housing industry. Deregulation turns out to be a bona fide panacea: a large rise in housing supply would raise living standards, reduce inequality, increase social mobility, promote economic growth, reduce homelessness, increase birth rates, help the environment, and more. Combining stunning visuals and careful interdisciplinary research, 'Build, Baby, Build' takes readers to a world where people are free to build―and shows us how to get there.

But many NIMBys will still say 'there are beautiful old neighbourhoods we need to protect,' or 'valuable coastlines that we shouldn't pollute with any building.' In this excerpt, Caplan notes that today’s governments strictly regulate skyscrapers — but the beloved skyline of New York City was largely built under near-laissez-faire conditions. And that today’s planners strictly protect historic buildings, but deny us any chance at something new and unthought of (and instead mandate places like Albany and Manukau, while living in the leafy unplanned inner-city suburbs they now write rules to protect ... )

Bastiat’s Buildings: Why I Wrote a Graphic Novel about Housing Regulation

by Bryan Caplan

The Cato Institute has just published my Build, Baby, Build: The Science and Ethics of Housing Regulation. The book is a non‐​fiction graphic novel. Think of it as the comic book equivalent of a documentary. Together with illustrator Ady Branzei, I combine words and pictures to give readers a tour of housing regulation, with a focus on how government restricts the construction industry, and what would happen if the restrictions were lifted.

About fifteen years ago, Larry Gonick’s Cartoon History of the Universe opened my eyes to the high potential of graphic non‐​fiction. Gonick’s books capitalise on the adage that “a picture is worth a thousand words” to teach history quickly. They use beauty and humour to hold readers’ attention. And though they look like comic books, they’re carefully researched.

In Build, Baby, Build, I try to emulate Gonick’s virtues. The book distills a vast empirical literature into a few critical lessons. Lessons like:
  • US housing regulation roughly doubles the cost of housing.
  • Besides making housing much cheaper, deregulation would increase productivity, equality, social mobility, environmental quality, fertility, and safety.
  • The standard arguments in favour of regulation are both overstated and one‐​sided.
But what finally convinced me to make this book a non‐​fiction graphic novel was my realisation that what drives much, perhaps most, support for housing regulation is aesthetics. Economists focus on cost‐​benefit analysis, but normal people are more likely to ask themselves, “Will development be beautiful?” — then confidently answer, “Absolutely not.”

Faced with such attitudes, economists tend to facepalm in frustration. My reaction, though, is remember 19th‐​century French economist Frédéric Bastiat’s classic essay, “What Is Seen and What Is Not Seen.” Writing in 1850, Bastiat explained that people focus on the obvious direct benefits of government, while ignoring the severe yet non‐​obvious harms. When government subsidises universities, for example, people rarely ponder, “What else could have been done with the money?” When government denies permission to build, similarly, we never actually see what would have been built if permission were granted. This makes it easy for critics to visualise the ugliest possible outcomes.


The epiphany that convinced me to write Build, Baby, Build: Instead of trying to argue people out of their aesthetic pessimism, I should use the graphic novel format to fight aesthetics with aesthetics — to show readers the beautiful unseen world that government forbids. And that’s why the fifth chapter of the book resurrects the great Bastiat as a co‐​narrator. After we explore his classic insight on “the seen versus the unseen,” Bastiat joins me on a guided tour through a deregulated world. Which lets me showcase a world that is not merely richer than the status quo, but more aesthetically pleasing as well.

For example, regulators often forbid construction in areas famous for their natural beauty. But why assume that construction would tarnish natural beauty rather than amplify it? Take a look and see for yourself:


To my eyes — and hopefully yours — the bottom panel is more, not less gorgeous than the top panel. And while you can fairly point out that these are fantasy drawings, they are inspired by real life. Who really aesthetically prefers the largely desolate California coastline to the awe‐​inspiring towns of Italy’s Amalfi Coast?

Or the decidedly pleasant but anadorned Bear Run River to the same river with a house by Frank Lloyd Wright showcasing its beauty, and now hosting hundreds of thousands of visitors every year.




The same lesson holds for so many of forms of housing regulation. Today’s governments strictly regulate skyscrapers. But the beloved skyline of New York City was largely built under near‐​laissez‐​faire conditions. Today’s governments strictly protect historic buildings. But construction of these historic buildings often began with the demolition of an earlier beloved building. The original Waldorf‐​Astoria Hotel really was destroyed to make room for the Empire State Building. That’s what I call building “the history of the future.”


Built in 1936

In a critique of my first book, philosophers Jon Elster and Hélène Landemore accuse me of being willing to use almost any rhetorical strategy to get my points across. While they overstate, they’re on to something. Once I’m convinced that my arguments are sound, I strive to sell them. Straightforward logic and evidence are fine, but so are thought experiments, appeals to common sense, humor, and beauty. 

False modesty aside, I think Build, Baby, Build is a beautiful book. If you like the visual samples I’ve shown you, I think you’ll agree.
* * * * 

Bryan Caplan is an American economist and author. Caplan is a professor of economics at George Mason University, research fellow at the Mercatus Center, adjunct scholar at the Cato Institute, and former contributor to the Freakonomics blog and EconLog. He has published in the American Economic Review, the Economic Journal, the Journal of Law and Economics, Social Science Quarterly, the Journal of Public Economics, the Southern Economic JournalPublic Choice, and numerous other outlets. His book, The Myth of the Rational Voter: Why Democracies Choose Bad Policies (2007), was published by Princeton University Press and named "the best political book this year" by the New York Times. Bryan posts frequently at his blog, Bet on It.
His post first appeared at the Cato at Liberty blog.
Buy his comic book at Amazon in both paperback and e-book.