OnPoint by Keith Ng

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OnPoint: Easy as 1, 2, 22.8 billion

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  • Rich Lock, in reply to BenWilson,

    You could quite easily make Mayfair an undesirable suburb by cutting the power and water.

    Or combine 'monopoly' with 'nuclear war', as I did with some friends once (hey, don't judge me: we were young and going through an experimental phase, 'k?)

    With one roll of a dice, make large tracts of the board completely uninhabitable desolate irradiated wastelands. Where's your Mayfair hotel now, eh?

    Anyway, as you were.

    back in the mother countr… • Since Feb 2007 • 2728 posts Report Reply

  • Bart Janssen, in reply to mattgeeknz,

    one of which the under-65s pay for with their income tax

    Because those over 65s have never paid tax in their lives?

    Superannuation was a very simple contract between the voters and the government ... voters paid taxes that the govt would set aside and invest and then pay back to those lucky enough to live past 65 years.

    Raising the age to 67 is reasonable.

    Stealing that money to provide tax cuts and buy votes is unreasonable.

    The problem has simply stemmed from unscrupulous politicians (redundant I know) who used that money as a private piggy bank promising to pay it back when it was needed - yeah right.

    Sorry just dislike it when people misrepresent the superannuation argument as poor workers supporting lazy old folks who never contributed anything anyway.

    Auckland • Since Nov 2006 • 4461 posts Report Reply

  • BenWilson, in reply to Bart Janssen,

    Superannuation was a very simple contract between the voters and the government ... voters paid taxes that the govt would set aside and invest and then pay back to those lucky enough to live past 65 years.

    It's a contract I never signed. I will pay for the oldies, but not because of any contract. It was an improvement on no pension of any kind, but the way that money is put aside for old people can, and should, be drastically improved.

    Auckland • Since Nov 2006 • 10657 posts Report Reply

  • Raymond A Francis,

    Good stuff Keith
    I see David Farrar has commented on your points over "there" I will not re-publish his points but would be interested in your response, if any

    While I can see the justice of taxing capital gains I am not so sure about governments taxing inflation that they have helped create

    45' South • Since Nov 2006 • 578 posts Report Reply

  • Steve Barnes,

    That's pretty much everyone in the workforce. So if everyone already gets something, how would more people get it?

    More people in the workforce under Labour?. Oops ;-)
    Anyway, as we all know, it is private debt that is the problem, not public debt. So, with Labour creating and retaining more jobs that problem is part solved.
    The rail car fiasco is a good example. Laying off workers because buying rail-cars from China is cheaper in the short term ignores the fact that those workers will become unemployed, therefore increasing their private debt burden at the same time as increasing welfare payments. This seems beyond the imagination of these Grabbit and Runn desk jockeys who claim to have the answers.

    the Right's belief that public servants can be squeezed indefinitely, and more efficiency will keep coming out.

    A nations economy cannot be based on workforce efficiency, I think a certain moustachioed Austrian chap proved that back in the late thirties. A functioning society relies on efficient use of resources and equitable distribution of income, the opposite of the aims of the Right.

    Peria • Since Dec 2006 • 5521 posts Report Reply

  • Che Tibby, in reply to Steve Barnes,

    The rail car fiasco is a good example. Laying off workers because buying rail-cars from China is cheaper in the short term ignores the fact that those workers will become unemployed, therefore increasing their private debt burden at the same time as increasing welfare payments.

    it also means that the expertise to maintain them is diminished. the Wellington Matangi trains are an example (AFAIK)

    the back of an envelope • Since Nov 2006 • 2042 posts Report Reply

  • Sean Maitland, in reply to Steve Barnes,

    Um, Steve Barnes - when people become unemployed, they get a new job - they don't just give up and spend the rest of their lives on the dole. In your world, is everyone a wet blanket?

    And your argument is so horrendously weak, that you have to resort to comparing National to the Nazis? Lol - go and lookup Godwin's Law on wikipedia sometime....

    Mount Eden • Since Jul 2011 • 4 posts Report Reply

  • Bart Janssen, in reply to BenWilson,

    I will pay for the oldies

    no, a thousand times no.

    You will pay for yourself, if you live that long, and while the govt is holding the money for you they will invest it in infrastructure and business in New Zealand. And yes, I remember at least two elections won/lost on precisely that promise.

    You are not paying for old folks, they have already paid for themselves but someone nicked the money.

    You could do this by a direct contribution scheme, oo look, just like kiwisaver or by a compulsory scheme, or you could do all of the above because each has their plusses and minuses and in combination they form a pretty decent method of supporting the old folks.

    Auckland • Since Nov 2006 • 4461 posts Report Reply

  • Sean Maitland, in reply to Sean Maitland,

    Keith Ng - you conveniently forget that Labour have stated that the $5000 tax free applies to all beneficiaries as well.

    If you can't even get that one right, I doubt the validity of any of your other arguments also.

    Mount Eden • Since Jul 2011 • 4 posts Report Reply

  • Deborah, in reply to Sean Maitland,

    My understanding is that beneficiary income is first worked out net of tax, then it is grossed up to create the weekly income / annual income figure, and then taxed together with any other income they earn. I had assumed the $5,000 tax free threshold would be taken into account when doing the grossing up calculation, so that net beneficiary income would remain about the same.

    New Lynn • Since Nov 2006 • 1447 posts Report Reply

  • Sean Maitland, in reply to Deborah,

    Deborah, you are correct that beneficiary income is net - but Labour have said they will be increasing beneficiary payments by $10 to match the increase in workers net pay after the tax cut takes effect.

    Keith conveniently missed this.

    Mount Eden • Since Jul 2011 • 4 posts Report Reply

  • Greg Dawson, in reply to Sean Maitland,

    Wait have we got 3 million beneficiaries now? That would explain why people keep getting so noisily unhappy about them.

    And uh, I assumed that Steve was talking about Hayek, not Hitler. Is Hayek a godwin now? I suppose there a large number of mustachioed Austrians to choose from.

    Wellington • Since Nov 2006 • 294 posts Report Reply

  • Sean Maitland, in reply to Greg Dawson,

    Wait have we got 3 million beneficiaries now? That would explain why people keep getting so noisily unhappy about them.

    If you add the size of the workforce, plus beneficiaries including super annuitants you get about 3 million - unless you can't count?

    Mount Eden • Since Jul 2011 • 4 posts Report Reply

  • BenWilson, in reply to Bart Janssen,

    no, a thousand times no.

    Actually, yes. They supported me when I was young, I support them when they are old. To say that they're supporting themselves by having supported me and that I'm supporting myself by supporting them is circuitous and quite pointless, requiring buy in to a contract that I didn't agree to because I was too young, and which they can't enforce. Every generation does actually have to make its choices afresh. The contract idea does my head in. What is actually wrong with saying that we support the elderly because we have social compassion? Why bring in "because we OWE them"? That just gives wiggle room to adding up just how much we do actually owe them, and perhaps calling the debt settled.

    Auckland • Since Nov 2006 • 10657 posts Report Reply

  • Rich of Observationz,

    The thing which people miss about retirement is that basically, the section of the population that works has to produce the goods and services that the retirees consume.

    Having a big pile of money "saved" by those retirees doesn't actually change that, except insofar that it can buy imported goods. I strongly suspect that any nation that does try to live a rentier existence off its accumulated pension funds will find that inflation and currency changes erode the value of those funds.

    For NZ, the real solution to the demographic problem is to take advantage of the unpopulated islands we live on and encourage more young migrants to offset the ageing population. (environmentally unfriendly - not really - by encouraging people to move from more crowded areas we reduce the overall environmental stress on the planet. Not to mention that more populous cities would force us into more sustainable ways of living).

    Back in Wellington • Since Nov 2006 • 5550 posts Report Reply

  • Gareth Ward, in reply to Sean Maitland,

    you conveniently forget that Labour have stated that the $5000 tax free applies to all beneficiaries as well.

    WTF? That number is in Labour's $1.3b cost - Joyce has invented this huge influx of people from somewhere to suddenly have the cost almost doubling in 10 years. You can argue that Keith should have said workers and beneficiaries but it doesn't change the underlying point. Good of you to then ignore every single other point made though.

    Auckland, NZ • Since Mar 2007 • 1727 posts Report Reply

  • Gareth Ward, in reply to BenWilson,

    Compulsory super contributions is the solution to our super problem. It won't harm anyone on super, but it can reign in the cost of national super really, really fast.

    Has to come with means-testing as well of course...

    Auckland, NZ • Since Mar 2007 • 1727 posts Report Reply

  • Che Tibby,

    sean, you find that trip-trapping noises make you a little angry?

    the back of an envelope • Since Nov 2006 • 2042 posts Report Reply

  • BenWilson, in reply to Rich of Observationz,

    I strongly suspect that any nation that does try to live a rentier existence off its accumulated pension funds will find that inflation and currency changes erode the value of those funds.

    It was fairly clear that extended economic stagnation in Japan and Germany came about from high levels of savings. But they are also very wealthy nations - would it be so bad to stagnate at a position of massive wealth?

    I don't think that inflation has too much effect on funds - at the very worst, a fund is likely to be in T-Bills which are pretty much tracking inflation, that is their main purpose. But they can be in anything the retirees want, once they get their hands on them, and there is room to have more or less risk profile even before retirement. My own Australian super fund has steadily grown since I left there 11 years ago, beating inflation quite handily even with the GFC.

    Currency changes? I can't see any reason for a correlation. Can you elaborate on this fear?

    Auckland • Since Nov 2006 • 10657 posts Report Reply

  • Sacha, in reply to Rich of Observationz,

    For NZ, the real solution to the demographic problem

    is to improve the value produced per worker and business - improving productivity and strategically supporting smarter industries are two options there. And to stop assuming that people cease creating value at 65 or 67 or whenever.

    Ak • Since May 2008 • 19745 posts Report Reply

  • BenWilson, in reply to Gareth Ward,

    Has to come with means-testing as well of course...

    I'm thinking that it's simply a percentage of income, how it's done in Oz. We can start off low, like they did, and then within ten years everyone will be clamoring to raise it. The money is taken from pre-tax income so it's tax-free. Unless you want to draw it early, in which case you have to back-pay the tax - one of the main reasons I still have my fund in Oz.

    Auckland • Since Nov 2006 • 10657 posts Report Reply

  • Kumara Republic, in reply to Sean Maitland,

    Um, Steve Barnes - when people become unemployed, they get a new job - they don't just give up and spend the rest of their lives on the dole. In your world, is everyone a wet blanket?

    Tell that to the factoryhands and meatworkers of a generation ago. The same underlying factors were a major underpinning of the French riots 6 years back - import low-skill migrants to do the jobs locals are too hoiti-toiti to do, and when times get tough and jobs are lost, scapegoat them for the nation's problems.

    And the wider issue that a lot of elbow-grease jobs have been rendered obsolete by motors and computers, but at the same time Luddism isn't the solution either.

    The southernmost capital … • Since Nov 2006 • 5446 posts Report Reply

  • Gareth Ward,

    I mean the outlay at the end - as per Aus, retain a universal super payment but it's mean tested, primarily against the amount you have in that compulsory super account... One of our problems as it currently stands is that KS does nothing about keeping the Govt's super bill down (as they still have to pay as they always did).

    This is (surely, right?!) an inevitability...

    Auckland, NZ • Since Mar 2007 • 1727 posts Report Reply

  • Rich of Observationz,

    Can you elaborate on this fear?

    So an imaginary nation, call it Smugland, has a prudent but aging population that saves well for their retirements. They’ve got large pension funds amassed overseas. Then they start wanting to bring the money home and convert it back into Smugs. The inflow of funds sends the value of the Smug rocketing, and reduces the purchasing power of their money. (It also increases demand while supply is falling due to workers retiring, and hence fuels inflation).

    [ We are seeing this in a small way as insurance money for Christchurch is sending the dollar and inflation up ]

    improving productivity and strategically supporting smarter industries

    Something which governments, and not just in NZ, have conspicuously failed to achieve. It’d be nice if industrial policy worked, and I’m sure it has a place, but by and large, it just doesn’t.

    Back in Wellington • Since Nov 2006 • 5550 posts Report Reply

  • Steve Barnes, in reply to Sean Maitland,

    Um, Steve Barnes – when people become unemployed, they get a new job – they don’t just give up and spend the rest of their lives on the dole.

    Ah, yes, of course they do, they could stack shelves at the supermarket or play professional Rugby with other hunky chaps or some other job that can be done without engaging the brain. After all, why do we need people with skills in manufacturing stuff when we can have bread and circuses?.
    Get real son not every Austrian was Hitler and I suppose not every Sean Maitland is a rugby player and not every ex All Black becomes a real estate salesman.

    Peria • Since Dec 2006 • 5521 posts Report Reply

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