Quote of the day:
Watching the TV1 news this evening, I saw a report indicating a high level of opposition on the part of small business owners to the Government’s proposed asset sales. And I was depressed all over again at how poorly this issue is understood.
If the average person was asked: Should the government increase the national debt to buy, say, Contact Energy, or Countdown supermarkets, most people would say “Don’t be mad – why would we increase government debt to do that?”
And yet, when the Government proposes to sell a minority interest in some existing businesses – some of them quite risky (e.g. Solid Energy and Air New Zealand) – to reduce its borrowing, a majority of the country reacts in horror. And yet the two situations are two sides of the same coin. If it doesn’t make sense to borrow to buy Contact Energy or Countdown, why doesn’t it make sense to sell Meridian Energy and Solid Energy to reduce borrowing? Don Brash