Crikey continues it’s dabate on Kiwis and Tasmanians, while an apple isle local takes issue with ANZ chief economist Saul Eslake.
1. KIWIS GETTING SHAFTED DOWN UNDER
Sealed section Nov 5
As the Irish stole our Melbourne Cup for the second time in a decade, it is worth reflecting on the differences between the booming island economy of Ireland and the struggling backwater known as New Zealand.
The poor old Kiwis just can’t take a trick in Australia at the moment. First we had Air New Zealand losing $1.3 billion buying into Ansett, then we completely shafted them on the hosting of next year’s Rugby World Cup and now Tower shares are going through the floor thanks to its Australian life operation.
Acting Tower CEO Keith Taylor just gave a pathetic interview on Business Breakfast – is it any wonder the stock has fallen 58 per cent in two days?
The Kiwi stockmarket plunged three per cent yesterday with Tower and Telecom NZ leading the way. Oh, did we forget to mention the $500 million plus TNZ has lost on its AAPT investment Down Under?
Any decent companies left in NZ seem to be moving across the Tasman. Tony O’Reilly has sold his NZ newspapers business Wilson and Horton into his Australian outfit APN and Lion Nathan and chemical company Nufarm have both shifted their headquarters to Australia over the past two years.
The only apparent exceptions to this trend include the Hart boys successes in Burns Philp and the apparent successful roll-out of an Australian retail operation for the Warehouse Group.
It comes as no surprise that the Kiwis failed to take the Melbourne Cup yesterday as they’ve had a shocking couple of years all round.
6. NEW ZULLUND NOT SO BROKE
Sealed section Nov 6
Saul Eslake writes:
I wouldn’t ordinarily go out of my way to defend Helen Cluck’s economic management record. But… your “Kiwis getting shafted down under” article in this morning’s sealed section is a little tough on NZ and a little generous to Ireland – at least in so far as recent history is concerned:
*NZ’s economy grew by 4.0% over the year to the June quarter, better than
*NZ’s unemployment rate (latest available June quarter 2002) of 5.1% is lower than any major OECD economy except Britain, and more than 1 pc point below Australia’s (Australia has only had three months of sub-6% unemployment in the past 20 years)
*NZ’s population growth rate has picked up significantly over the past two years – growing 1.5% over the year to the June quarter (faster even than Australia’s 1.2% over the year to the March quarter, latest available) compared with 0.5% during 1999 and 2000 – it would be a long time, I imagine, since NZ’s population has grown more quickly than Australia’s (this might be partly due to the clampdown last year on the ability of NZ citizens resident in Australia to claim Australian social security benefits)
*And even with the sharp decline following the disclosure of Tower NZ and TCNZ’s problems, NZ’s share market is down “only” 8.6% so far this year which actually makes it one of the best (or, more accurately, least worst) performing in the world, as against for example Australia’s -12.6%, the
Dow’s -19.4% (excluding their overnight movement), Nikkei -25.4%, FTSE -22.1% etc.
By contrast, much as I admire Ireland’s long-term economic performance over the past 20 years (and often use it as an example of what Tasmania could do if it really tried), it hasn’t done quite so well recently:
* Irish economic growth, which often topped 10% during the 1990s and reached 11.5% in 2000, slowed to 5.9% in 2001 and to just 2.9% over the year to the March quarter this year (less even than NZ!)
* the Irish unemployment rate troughed at (a pretty impressive) 3.6% in January last year and has since risen to 4.3% as of October – still better than most other places including NZ but nonetheless going up whereas NZ is heading in the right direction.
Ireland’s economy has been suffering from what might now seem (with all the
wisdom that hindsight imparts) to have been an excessive dependence on IT.
CRIKEY: It’s hard to argue with the ANZ’s chief economist. But if anyone wants to, mount your case at [email protected]
14. SAUL ESLAKE WRONG ON TASSIE AND NZ
Nov 7 sealed section
A Tasmanian takes issue with ANZ chief economist Saul Eslake:
“I read with interest the piece from Saul Eslake and his quote “and often use it as an example of what Tasmania could do if it really tried”. Saul is a very nice guy and very intelligent but he must have a memory lapse — Saul supported the very policies that have put Tasmania in its terrible financial position today — pro-green and anti-development.
Saul supported fiscal moves by former premiers Field and Rundle to reduce state debt — which destroyed confidence in the state and showed none of the benefits expected. While I do not support huge state debts, it is clear that there is a manageable level, and destroying business confidence is clearly the wrong way to go.
There is no doubt that the Green movement and several Federal Labour governments have destroyed investment in Tasmania, with virutally no new major developments since the proposed pulp mill was blocked by Hawke in 1989. Those who argued that Tourism and Cottage industries could replace big industry in Tasmania, have long been proved to be wrong.
Thankfully, the current Premier, Jim Bacon, gets it, and is doing a great job or restoring faith in Tasmania — and guess what Saul, he does use state borrowings. I wonder if Saul thinks it would be possible to create a Silicon Valley around the Hobart Campus of the University of Tasmania — not a chance, based on my own studies of the development of Silicon Valley and Austin, Texas.
Tasmania’s unemployment rate released today was 8.2% versus 5.6% in NSW — the blame can be laid at the feet of the High Court, which in 1983 gave the Federal Government the right to over-rule State Government decisions for the sake of the Green vote in marginal seats in NSW and Victoria.
And by the way, anyone who thinks an economy (NZ) which has virtually no major companies or head offices, has long term growth potential in line with OECD, will be proved very wrong by history.
11. IN DEFENCE OF SAUL ESLAKE
Second sealed section Nov 8
Here is a defence of Saul Eslake by Greg Barns and Jane Rankin-Reid, the latter being a well-known Tasmanian cultural commentator.
“Astounding to hear ANZ chief economist Saul Eslake’s social and financial equations for dragging Tasmania out of its welfare asylum run counter to Crikey Green commentator’s perceptions of historical time lines.
Tasmania’s environmental Left are now blaming the states’ relatively successful deficit reduction on governments whom they partnered in Regional Forest Agreements.
Which bit hurts? The Tasmanian Green’s global popularisation of eco-bullying has been at the expense of chronic local social problems. Surely these are the truths meant for national ariport billboards if morally badgering tourists into not visiting Tasmania is their aim? The Greens have neglected the state’s endemic unemployment, higher national rates of youth suicide, child abuse, battered women and lack of low income housing for the last 20 years.
This chattering class of environmental squealers are indulging in selective slanging matches rather than growing up and getting a life. Gaining more urgent Tasmanian social problems in Green political vocabulary is harder than slow dancing with an octopus. Anybody in the 21st century who calls a democratically elected representative a saint needs hospitalisation. Humanity defines existence, no matter how many trees are missing from the landscape.