An ode inspired by National's mixed ownership programme, to the tune of 'Five Little Monkeys"... And a few thoughts about the sales and the Supreme Court

Five state assets going on the block

Airline prices fell and so did one's stock

Don't sell Air New Zealand, the people said

Bill replied "Hmph, I'll sell the other four instead"

 

Four state assets going on the block

One went for lignite and only hit rock (bottom, that is)

"Now we can't sell that one," Bill and John said

"But don't admit the goal of seven billion's shred"

 

Three state assets going on the block

But Tiwai wants a discount or might close up shop

There go millions the markets said

But Tony says "it's cash for schools, we'll push ahead"

 

Two state assets going on the block

The court says yes to MRP, Bill says right let's rock

"It'll pay for that Puhoi road... just," he said

"Tell Tony to sush about the schools or we're dead"

 

One state asset going on the block

"We must sell something to get us out of hock...

And those markets and voters don't know squat," John said

"We won, you lost, eat that, it's time we led"

 

No state assets yet on the block

2014's on its way... tock, tick, tock

Will one or two sales help the stock exchange or debt?

Bill just shrugged: "We're doing what we said".

 

Hmmm. I enjoyed that. Yesterday's Supreme Court ruling has been well-picked over already, with everyone repeating well-rehearsed lines and the public un budged in its majority opposition.

The simple maths most folks do is to look at the quick cash these assets will deliver versus the long-term dividends, they think about the fact we're selling low in the economic cycle, in increased cost of power and what those dividends could mean for their kids, and they think it's daft to sell.

But the fact remains that the process has been impeccable and is a testament to our political system. National sought a mandate at an election, won, and is now inacting what it promised (or perhaps a little less). It hasn't over-reached. Opposition parties damning it and insisting it has no mandate are only making themselves hypocrites and making a rod for their own back to be used when they get into power.

We must allow governments to lead when in power and sometimes do the brave and unpopular thing. If you believe that, and I do, you can't say National has no mandate. A government can't seek a majority for every policy and can't be ruled by referendum.

So National went to the polls, has explained at length, taken its time, consulted with affected parties and then went to court when they couldn't agree. They said they would accept the ruling of the country's highest court.

That's a textbook process, even if the outcome is deeply flawed. National's acted impeccably in doing the wrong thing.

It's wrong by the Opposition's standards of public ownership and retaining dividends. But it's also wrong by its own standards, because the timing is wrong, the price won't be as high as it might be, it won't spark the stock exchange into life (it was already on a roll prior to the announcement yesterday), and the few assets left to be sold means the government is unlikely to reach the profit targets mentioned.

Oh, and it will soon be clear to everyone -- because it's not yet -- that "mum and dad" investors means KiwiSaver funds.

The trouble for National is that politically they've hitched themselves to this wagon regardless of water rights, Rio Tinto, market slumps and even the mismanagement of Solid Energy.

The sale plan is badly damaged and anyone in the private sector would be stepping back, looking at how five has become one or two, and reviewing the whole exercise. But this is one of the few policies on which National has decided to look decisive and brave. They've backed themselves into a corner and now will look weak -- and worst of all like bad economic managers - if they were to do the sensible thing and taihoa.

As for the court decision itself, I tend to agree with Andrew. It's the right decision. But history may well look back at this case as the end of Maoridom's asset sale protest and the beginning of its water rights claim.

And I can't help but wonder at the bit where the Supreme Court over-turned the High Vourt and said it could review the sale of shares. Greater legal minds than mine can comment on this, but that reads like a promisory note to me... This is a court that's not afraid to be activist and may, on the right occasion, be willing to challenge the supremacy of parliament.

Comments (4)

by Matthew Percival on February 28, 2013
Matthew Percival

An amusing poem Tim and one that just goes to show a year is a long time in politics.

The the NZSX50 passing through 4,300 today and continuing it's upward trend the "bad time to list" argument is doing a 180. Indeed by the time these companies get to market I'll suggest they may very well be listing near peak time! Even Air New Zealand posted a positive result. With the continuing strength in the economy I can see the value of Air NZ increasing over the next 12-18 months. It may very well be a good time to list Air NZ in 18 months time?

Solid Energy is the exception. It was always a riskier investment and I wasn't about to touch it with a 40ft barge pole.

by Tim Watkin on February 28, 2013
Tim Watkin

Matthew, I don't think Air New Zealand is so ripe for sale. For a start, as long as the dollar stay high tourism will hardly be booming. And a sale in 18 months time? Never. That would be three months before the election. Whatever they say otherwise, National won't sell close to an election.

by stuart munro on March 01, 2013
stuart munro

Not a bad analysis, but no, National has no right to sell whatsoever.

Governments must indeed from time to time nail their principles to their masts and steam ahead notwithstanding the mines, torpedos, and opposition agitprop.

But this government doesn't meet the first and most basic principle of leadership. If you expect to lead people you'd better have some idea where you're going.

They've lost their way, if indeed they ever had it.

by DeepRed on March 02, 2013
DeepRed

I'd say 'middle' NZers voted for Key in spite the asset sales issue, rather than because of it. It was without doubt a burning issue, but Labour failed to turn it into a wedge one.

By contrast, it's shooting fish in a barrel to scapegoat the troubles of a weakening middle class on those right below the food chain. The 12 cookies joke neatly sums it up:

A CEO, a Tea Party member and public employee sit at a table, with 12 cookies on a plate. The CEO grabs 11 cookies and tells the Tea Party member, "You better watch him. He wants your cookie."

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