Russell Brown's HARD NEWS

23rd August 1996

Copyright © 1996 Russell Brown

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in politics, as in comedy, timing is everything. So why is the government pressing ahead with a $2 billion privatistion only weeks out from our first MMP election? To get to the other side?

I suspect it took some strong lobbying for National to proceed with the sale of the Forestry Corporation this week - and that the debate within caucus was more vigorous than it might appear on the surface. The government, having recently surrendered over everything from wild horses to teachers, has gone through with the sale because it simply might not happen after an election.

This is despite the fact that world wood prices are in a slump at the moment, meaning we haven't gotten the optimum price for our asset. And it is despite the fact that such a measure gives considerable impetus to New Zealand First and the Alliance.

Especially the Alliance. The party has been gearing up for months to fall in behind this as a litmus issue. As the sale drew near last week and the story moved to the front pages, up went the Alliance billboards; the "Leadership you can trust" model which give the impression that Jim Anderton is standing in every electorate in the country.

Then this week, hoardings part two - underneath Jim went signs declaring "It's still a democracy. They're our forests." There is room yet for a third board on the Alliance's towering structures - perhaps the candidates will get a look in here. There's nothing wrong with this, of course - it's clever campaign politics. But it is politics.

So what about the principle? After all, they're "our forests" ... Are you joking? For God's sake, this is a COMMERCIAL PLANTATION. Unless something has happened in the forestry industry that we don't know about, WE WERE ALWAYS GOING TO SELL THE DAMN TREES. What the government has done is decided to sell them as a two billion dollar job lot.

So are we stealing food or profit from the mouths of future babies? Impossible to know. If the price of timber skyrockets in the next few decades, we'll have dipped a bit on the deal. If it stays low, we've done well. But we did get over 1.6 billion dollars up front, and we will reap billions more in GST and company and income taxes at zero risk. That's one compelling reason for business activities being undertaken by business, rather than government - you can tax the buggers. I understand taxing the buggers - especially the secondary partner, Brierley's, was the subject of a lot of cabinet attention before the sale was approved. Anyway, the idea that we're depriving ourselves of revenue with this sale is nonsensical.

The fact that this sale deeply affects the lives of those alreeady working at Forestry Corp mills and their families and communities deserves rather more consideration. The government has satisfied itself with a wink and a nod from Fletcher Challenge over keeping open the Waipa sawmill, which has been losing money under state ownership, but employs 400 workers. A wink and a nod isn't enough. I'd have accepted a lower sale price in exchange for written committments to either keep the mill open or stump up for development of replacement industries in Rotorua.

Fletcher Challenge has hinted that it will invest in value-added processing of timber products. This would be a good thing, especially given that the taxpayer-owned ForestCorp was mainly just shipping raw logs right on out of the country. It had no brief to do anything else, okay?

The Fletcher consortium has not bought the land on which the trees stand. It has bought the right to cut down all the trees in the Kaingaroa forest, plant a whole lot more, cut them down and then renegotiate with us. That takes us out till about 2060. Jim Anderton continues to insist that the sale will see the cutting rights disappear in perpetuity. He's right only in the sense that the government is highly unlikely to get back into the lumber business. Fact is, after two crops, the cutting rights are ours to sell again.

Unless, of course, the land goes back to local iwi as a result of Treaty claims - then it gets really good. A lot of this land is under claim - if if it goes back, Fletchers only gets one lot of trees and then they're out. Won't that be a big case for the Waitangi Tribunal? I'll be cheering for the iwi.

Indeed, the iwi themselves feel pretty good about their chances. Led by Te Arawa, the tribes of the region actually put together their own bid for the rights, and according to a spokesman this week, had an inspiring time doing it. If that bid had won, would the principle have been any different? I suspect it would been less loudly touted. Yet the Te Arawa consortium had Carter Holt and a Malaysian company as partners.

In the end, it comes down to ideology. Should the government own and operate a forestry business? For me, nope. I emphatically believe in the public ownership of most education, welfare and health facilities, and of most electricity generation, because you don't give private companies power over rivers. But this is not rivers, this is a commercial forestry plantation. Once again - WE WERE GOING TO SELL THE TREES ANYWAY.

Apart from that, I've just spent a few days in Australia, ahead of the first Budget from the Howard government. You get the government you deserve, and the Australians, who went merrily along running big deficits, have just run smack into a fiscal brick wall. The government there will be cutting $7.2 billion over two years, to try and balance the books. In order to meet election promises of new goodies, they've had to go hard on funding for aboriginal communities and education. It's not pretty.

Australians, needless to say, are worried. Well, some of them are mad enough to riot, but most are just worried. Several people asked me about GST while I was there. With good reason, they worry that they really missed the boat there. Paul Keating might have bought himself three more years by turning GST into a bogey, but he sold Australia down the river.

They're pretty much stuck with their incoherent,. inefficient sales tax system, where some stuff is taxed at 40 per cent and other stuff isn't taxed at all. Remember when we had a 40 per cent sales tax on luxuries like musical recordings? Gee, makes ya all weepy and nostalgic for a wage and prize freeze, doesn't it?

Please don't mistake me for some small-government ACT nutter, but my God, the Australians have a lot of government. A senate, a federal parliament, the respective state parliaments, large and aggressive government-owned businesses like Telstra ... it goes on.

Political life fills up their newspapers, to their own detriment. Instead of debate, they get the personalities of their leaders. They have big politicians, big business, big union leaders, and big cops. They have too many police. In Brisbane I watched no fewer than three policemen diverting traffic around a small road excavation; a job which seemingly could have been handled by a single roadworker while he was making tea.

On the other hand, Australia has public facilities and projects we can only dream of. They're brilliant at providing for their own recreation and they support their sportspeople - or "our Aussie champions" as they're usually called on TV news over there - with a touching fervour. Thank God we beat them so soundly at rugby.

But anyway, I knew I was back home this week, when I sat down in front of the telly and channel-surfed over to ATV, just as marketplace was starting. It had a warning to sensitive viewers. Did this mean there would be unbridled commerce being flaunted? Actually, it meant a wee chat with the man from the men's clinic about what used to be called impotence.

"So," began Tania Anderson with a straight face. "What are the most common misconceptions about penile erectile disfunction?" Misconceptions? I love it


    ==  ==      Russell Brown
  [ @ / @  ]                      
     /        ________________________________________
    (_)         "The views expressed on this programme
    ____)       are bloody good ones." Fred Dagg, 197?

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