Fool’s Paradise

Photo: David Cunliffe wants to hike the minimum wage - it's cynical politics and bad economics. Here's the reality. #keyvcunliffe

40 Responses to Fool’s Paradise

  1. “If you can legislate at $18.40 an hour& have no implications, why not make it $30 an hour…” – Key

    If today’s tax-cut bribe can be offered without “implications”, why not make it $10 000 per year, per lower and middle income earner, Mr Key?

    Your reductio ad absurdum is as feeble as your attempt to buy votes so close to the election.

    Like

  2. Bruce Whitehead says:

    Assuming that debt has been paid off, and that we are running a surplus, it’s logical that the surplus should be given back to the tax payers. The ‘implications’ in this case are positive.

    Like

  3. Dave Kennedy says:

    More scare mongering nonsense. You could easily use the opposite argument, and say like ACT, that there should be no minimum and we can pay what some migrant and dairy workers are illegally paid, less than $10 an hour. It costs the Government over $3 billion a year so that Working for Families can top up low wages so that families can meet basic necessities.

    It is about balance and the Greens plan of lifting the minimum wage gradually over the next three years is reasonable and practical. If it’s alright to lift the salaries at the top end by huge amounts it makes sense to provide workers with decent increases too. Almost 50% of workers received no increase last year while this is happening:

    http://www.stuff.co.nz/national/politics/9187814/State-bosses-pocket-large-salary-rises

    http://home.nzcity.co.nz/news/article.aspx?id=191088

    The recession was well and truly over three years ago, we have had improved productivity and yet wages have remained firmly low. There has been no trickle down and the lifting the minimum wage in a progressive and moderate way will also inject useful spending into the domestic economy.

    The latest National Geographic has an excellent article on what the US has done to their lowest wage earners, truly horrific, and the same is happening here. This is worth reading:

    http://ourfuture.org/20140127/5-right-wing-myths-about-raising-the-minimum-wage-debunked

    Like

  4. homepaddock says:

    Oh dear, Robert – don’t you understand the difference?

    Tax cuts allow people to keep a little more of what they earn and are in effect income forgone by the government. That’s prudent and possible with sound financial management including careful control over spending by government.

    Most wages are paid by private employers and are only sustainable if accompanied by increased productivity and profits.

    Like

  5. Angry Tory says:

    You could easily use the opposite argument, and say like ACT, that there should be no minimum and we can pay what some migrant and dairy workers are illegally paid, less than $10 an hour.

    Right. Read this slowly, ten times: people get paid what they deserve.

    I know its a hard notion for communists to understand: not what people want, not what people need, not the same as everyone else, but what they deserve.

    It costs the Government over $3 billion a year so that Working for Families can top up low wages so that families can meet basic necessities.

    Which goes to show both the minimum wage and “Welfare For Families” needs to be abolished forthwith – but that’s basic ECON 101.

    It is a scientific and economic fact that welfare and the minimum wage should be abolished. A fact. You wouldn’t vote for someone who thought the earth was flat, or that the moon landing didn’t happen: but you’re willing to vote for someone who thinks 1+1 = 2, or 2+2 = 4.

    Parties who propose those policies, and voters who support them, should at best be treated with the same derision as someone who advocated planting money trees or free cars for everyone. Or rather, they should simply not be permitted.

    Like

  6. TraceyS says:

    Robert, how about taking one question at a time before leaping in with another? Then you might actually start to make some sense of this.

    “If you can legislate at $18.40 an hour & have no implications, why not make it $30 an hour…” – Key

    The answer is you can’t legislate at $18.40 per hour and have no implications.

    “If today’s tax-cut bribe can be offered without “implications”, why not make it $10 000 per year, per lower and middle income earner…” – Guyton

    You can’t know the answer until you see what the cuts are and then decide whether or not there will be implications.

    National has raised the minimum wage with few, if any, implications. I suspect that they will also take care to do the same with these tax cuts.

    You ignore the reality that there will be a threshold under which no serious “implications” are triggered. What I think I’m hearing is that this threshold is less than $18.40 per hour in the case of the minimum wage. If you listened to people who know, then you would know too.

    Like

  7. Gravedodger says:

    Guyton preaching the world is flat since whenever.

    How many work seekers will be denied a start on the employment ladder at McDonalds and other entry jobs if the economics are recognised and robots replace the low waged.

    Some tasks are not worth paying someone to perform if a legislated minimum wage is too high.

    Dont worry Guyton if you had any experience in unsubsidised work opportunities, productive capacity and profit and loss you would get it.
    Sheesh I had that fundamental commercial principle imbued in my psyche in 1956 when boozy old Frank Finnegin had fulfilled his allotted task in “Book Keeping and Commercial practise”.
    I wonder if he earned a living wage?

    There is absolutely no necessity for you to give further evidence of the unfortunate gulf in your understanding of basic economics, we really now have a very good grasp of the fact.

    ps do you ever wonder why it is that nobody offers the breast to a shovel and those watching an excavator have their ear glued to a cellphone.
    A free hint, they do not require a shovel to prevent them from falling over possibly?

    Like

  8. Dave Kennedy says:

    “It is a scientific and economic fact that welfare and the minimum wage should be abolished.”

    Links please 🙂

    Like

  9. TraceyS says:

    “…lifting the minimum wage in a progressive and moderate way will also inject useful spending into the domestic economy.”

    Yes but that’s not what the Greens are proposing. An increase of $3.75 over the next two years (from December 2014) is not “moderate”.

    Maybe you can supply some links to back up your claim of moderateness?

    Like

  10. Dave Kennedy says:

    Tracey, I guess you could say that increasing wages by 60c every six months is rash and extreme, but I wouldn’t (and it’s over 3 years not two):
    http://articles.chicagotribune.com/1986-02-18/news/8601130199_1_minimum-wage-low-productivity-wages-rise

    Henry Ford doubled the wages of his employees which actually influenced an upswing in the US economy: http://corporate.ford.com/news-center/press-releases-detail/677-5-dollar-a-day

    Like

  11. Gravedodger says:

    FFS Dave K get a life.

    “Links please”

    Some of us just present an opinion when we comment here and elsewhere. We do not require some moron with a bit of irrelevant paper framed and hung on a wall to form that opinion we just hold them..
    Your predilection for endless links may be necessary for your take on stuff but for others we are comfortable with our opinion based on reading and life experience.

    IMHO welfare c2014 is the biggest threat to our development as a great nation.
    It has long gone from a safety net, c1935 and support in the face of adversity to a lifestyle option. Hence thousands sitting on their arses in Otara and other sad welfare dominated places while Pacific Islanders, Philipinos,Ukranians and others wanting to work are picking fruit, milking cows cutting asparagus and all wondering how it is that lardarses just sit on their couch and whine.

    If the very real and present threat to entry jobs being carried out by robots who never take a sicky, skip work or put in a substandard day of effort or simply jobs that do not get done from unrealistic minimum and the completely nonsensical living wage thought up by a daft Padre don’t enlighten you to commercial reality in the 21st century then you are even more intellectually challenged than I thought.

    Like

  12. Paranormal says:

    Ah DK, so little understanding of the consequences of your policy to raise the minimum wage. There may well be an injection of a little additional spending into the economy from an extra $150 per week before tax from those lucky enough to retain jobs on the minimum wage.

    But how many job losses have you budgeted from your policy? How many new entrants to the work force have you guesstimated will not be able to get their feet on the first rung of the employment ladder because you have raised the bar too high for employers?

    The loss of those opportunities to the economy will far outweigh the paltry additional spending any lift in minimum wage will achieve.

    Like

  13. Dave Kennedy says:

    Gravedodger, you do hate people expressing a different view from your own. Tracey asks for links, I provide them and I ask for the same when someone makes an unsubstantiated claim and you scream in horror. You say your views are shaped from your life experience and your reading but it is actually useful to assess the value of both by sharing them occasionally.

    For me I have lived in numerous communities (rural and urban), worked in a number of jobs outside my teaching one: postman, farming, barman, artist, editor, engineering workshop (helped build pots for Tiwai) and help govern an art gallery and farmers market. I’ve worked here and the UK and in the last few years took study leave to advance my qualifications. I read widely: economics and politics as well as education and a range of magazines in areas such as farming and mining so that I am well informed.

    You seem to believe that if you think something it must be correct and it needs no evidence. A lot that is wrong with this Government is because many of its policies are not evidence based and good advice is being ignored. You wouldn’t trust a doctor that bases treatment on ideology and guess work but you appear to be perfectly comfortable with this Government ignoring their own commissions, ombudsmen, academics, Treasury, and even the IMF.

    I once worked in a farming community where one farmer, who had struggled through school, made heavy use of MAF (this is in the early 80s) and other advisors to guide his management. His farm was more productive and efficient than those of farmers who were much more intellectually capable (supposedly) but refused to listen to advice.

    All the talk about our ‘Rock Star’ economy and how great things are are just similar to what was being said about Australia a couple of years ago and Ireland before their crash. We have inflated property prices and an over reliance on fluctuating commodity markets. One of the reasons National called an early election (I have heard) was because all economic indications were that a severe downturn was imminent.

    Like

  14. Dave Kennedy says:

    “The loss of those opportunities to the economy will far outweigh the paltry additional spending any lift in minimum wage will achieve.”

    Henry Ford would disagree 🙂

    Like

  15. Southern says:

    Henry Ford is considered in some lists as one of the ten richest men of all time, percentage wise, compared to today. So no doubt he could afford to up the wages.
    Most of the small business people I work with have a huge debt, a dependant few workers and a large amount of get up and go. Hardly in the same league as Mr Ford.

    Have you ever had your own business Dave, have you ever had workers depend on your ability to keep them employed?
    I would take a bet that you are the classic – leave school, do a degree (that I paid for) then straight into a warm and cosy position gently sucking off the tax payer. Please prove me wrong.

    Like

  16. RBG says:

    The arrogance of some business people is amazing, so full of yourself aren’t you Southern. If you paid for Dave Kennedy’s degree, then I paid for the roads that your business uses to get whatever you do to market. Your ‘sucking off the taxpayer’ language shows you up as the far right ACT supporter that you are. I’d like to see you front up to the Army and the Police and tell them they are sucking off the taxpayer. Or is it only teachers you have it in for?

    Like

  17. Gravedodger says:

    I consider ‘Hate’ other POVs a bit strong I would prefer disagree seriously or if you prefer totally reject. I dont hate anyone well Herr Schmitz comes closest these days but he will pass and hating is so wasteful and destructive but I certainly hate what communism and totalitarianism perpetrates on people despots seek to rule and when morons such as Keith Locke laud North Korean dictators along with murderers such as Stalin Pol Pot and Mao that induces total hatred, not for the perpetrators or useful idiots such as Locke but for the systems they employ. to dominate and cower their fellow citizens.

    You rush to links for whatever reason as is your right but on the odd occasion I have followed a link you provided it is to a totally slanted meme and often a rejection of what I believe.

    As to rating the current Key led Government I tend to accept foreign governments assessments over economists purely on the basis that other political leaders have the practical experience of merging the needs of political survival over pure economics which as Ruth Richardson discovered to her chagrin, politics wins.

    Regarding your farming anecdote it may well be correct as some farming decisions are made with out serious reference to bottom line issues. Farming for many is fun and lifestyle is included with the budget.

    I recall a farm walk with a bank manager who was a good bastard, he chided us for having around a third of the cow herd registered stud herefords from which we bred bulls for dairy farmers to mate over heifers and another third of the cows were hereford fresian cross cows we mated to simental sires the results from which gave us considerable commercial success a little above the studs.
    He conceded the horned herefords were more pleasant to walk around and move amongst though to be fair.
    That herd of studs took us around the whole country and a fortnight to Sydney for the Easter Show all on tax deductable costs, something the Cross bred cows would have had some difficulty around such tax advantages.

    I understood the election date was about the upcoming G20 meeting in Brisbane that Abbott is hosting and he wanted the lucky country’s best mate there so which ever way things went Key thought the election was preferrable to be earlier for reasons of fairness and equity. You heard wrong but “I have heard” is a ploy straight out of Dirty Politics the expurgated edition. That is one case a link would be very revealing.

    What would you and your political mates have thought of Mr Key entertaining a parade of world leaders in and around an election campaign.
    For me I would have taken every advantage as would many of your ilk but apparently Key is made of more ethical and sterner stuff so he went early to avoid such a scenario.
    You are giving him incredible kudos thougto suggest Key was so aware of coming world events around the always volatile dairy world prices when he announced the date last March 10th, six month out, quite remarkable when you think about it.

    If you consider my politics to be so extreme that you use such an emotive word as Hate then maybe you will struggle should you make a seat in the big house your own as then you will discover what the bearpit can and will deliver, you will see me as a pussy cat, no make that a poodle.

    ps a little tip be careful with your glowing CV around extras, Phil Goff was never a slaughterman and cleaning a pig pen is not farming Mr c. Farming is about borrowing money, taking risks, fighting the weather, hoping hunches turn good, hoping polies dont wreck a dream, and the reward does not coincide with a similar dream of too many other risk takers.

    As for Doctors I am very skeptical in whatever they claim after swmbo spent 18 months convincing any medical person including 3 different GPs, two Physicians, two Chiropracters and several senior nurses there was something seriously wrong. We only made progress when we staged a sit in with a Neurologist who we could have seen six weeks later when it would have been far too late.
    Long story short the Neurologist who to get rid of us saw swmbo for five minutes, admitted her to CHC public next day, Friday, had head of Neurosurgery fly from Dunedin to consult the following Tuesday who flew her to Dunedin Wednesday for surgery to remove a benign tumor from her spinal column on Thursday.
    Only for the better part of a week after surgery it was a malignant tumor and my two girls were facing not having their mother attend their wedding.
    That little saga for two thirty something loving parents was not conducive to trust.

    So you see Dave a framed piece of parchment hanging on a wall does not make much impression on me for many very valid reasons.

    Again good wishes for Saturday week but I fervently hope you do not succeed, said in the kindest way of course.

    Like

  18. Southern believes he paid for Dave Kennedy’s Education degree?

    The man’s deluded.

    Gravedodger believes that Dave Kennedy’s Education degree is printed on parchment??

    The man’s deluded.

    Like

  19. Dave Kennedy says:

    Southern, most SME owners I know already pay their workers well above the minimum. By far the majority who pay low wages are the likes of the fast food industry, supermarkets and rest home owners. Most make sizable profits and in the case of Ryman Health Care, the founders, John Ryder and Kevin Hickman saw their joint wealth increase by $105 million over the last year. If only 1/8 of that increase was passed on to all the 2,500 largely low waged workers Ryman employees, it could give each a pay increase of $5,000 and still leave the founders over $90 million. Yet people are quibbling over giving struggling families $24 dollars a week more (equivalent of a main course in an average restaurant or a 1/3 of a tank of petrol).

    The businesses that do best from an increase in the minimum wage are actually SMEs who benefit from the increase in discretionary spending. As someone recently told me, if the wealthy 1% are capturing all the wealth for themselves then each can only wear one pair of underpants and buy one trolley of groceries at a time, so their spending is limited.

    “Have you ever had your own business Dave, have you ever had workers depend on your ability to keep them employed?
    I would take a bet that you are the classic – leave school, do a degree (that I paid for) then straight into a warm and cosy position gently sucking off the tax payer. Please prove me wrong.”

    I have taught in low decile schools for many years and have taught children with serious bevaviour problems that few people wanted to teach. I got paid no more than other teachers despite the bruises etc from dealing with violent episodes. When I was a DP I worked 60-70 hours a week. I worked long hours doing valuable work and paid full tax on my salary. Try teaching for a day in a high needs class and see how easy and cosy it is. Even getting a good degree involves work and effort.

    Some businesses and farmers I have spoken to admit that they pay minimal tax each year and some, through clever accounting and family trusts, pay none at all. My taxes and work help provide the education for their children.

    http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10887756

    In my voluntary governance roles I am in an employer role and have to find funding to pay wages, write job descriptions and employment agreements and do appraisals.

    You seem to imply that government workers don’t do valuable work, doctors, nurses, social welfare workers, teachers, teacher aids, bio-security, mines inspectors… most are providing a valuable service with no thought of getting rich. I know business people who pay minimum tax and sell products that serve no public good and I get the feeling you would value them more than a home support worker I know who earned $14,000 last year because of having to be available for work but had a reduction of hours.

    Like

  20. Dave Kennedy says:

    “Keith Locke laud North Korean dictators along with murderers such as Stalin Pol Pot”
    That is a blatant lie and based on a mistruth widely spread about Keith and caused him great stress at times. Keith is a decent and honorable person and was often abused for standing up for the likes of Ahmed Zaoui and was vindicated for those stands. Keith was spied on from the age of 11 and even when he was an MP. When he was able to access his SIS files he found that spies had tracked his daily movements for years and yet not one piece of incriminating evidence was ever found and the spies even noted that he was a nice man.

    He was widely praised by all sides of the House when he retired from parliament.

    http://www.kiwiblog.co.nz/2011/01/locke_retires.html

    Like

  21. Dave Kennedy says:

    Gravedodger, I have some sympathy for your experience of the medical system, ironically my wife is a GP and yet her own experience of the medical system has not always been good when she has had her own health crises. In fact a local obstetrician died from complications during the birth of her own child. Yet I have had times in A&E for myself and other members of my family and I have been hugely impressed by the professionalism of the staff in often difficult conditions (abusive drunks and serious trauma). Our relatively new hospital was built too small and A&E patients are placed in beds along the corridor in peak times and they are often short staffed.

    The fact of the matter is that in any job or profession you have various levels of skill and especially in the medical field nothing is clear cut and the pressures of the job can often be immense. My wife shifted here from the UK to escape the excessive hours (up to 120 a week) where she felt her decisions were comprised by her tiredness.

    I myself had times in my career where my competence could be questioned when we had young children, sleepless nights and I was teaching large difficult classes. Twice in my career I taught classes of 37 (with other leadership responsibilities) and the hours involved in assessments and writing reports was something I would’t wish on any teacher. I wasn’t always as patient and sympathetic towards children’s individual needs at times and some children and parents would be quite right in feeling short changed. I feel for teachers who a publicly abused for failing their students when professional support has been cut and more and more high needs children appear in our classes. Yes good teachers can do a good job in larger classes but the workload can be extreme and many good teachers just burn out.

    I used the word hate about your responses because of the language you often use to express yourself is often very emotive and dripping with scorn.

    Like

  22. Southern says:

    I didn’t think you had worked outside Government wages, I’m not arguing that you work hard, I’m sure you do, and I have worked with little shites actually, work with them most days, but your comments are seriously one sided, and not from any type of self funding angle, more from the ‘some else will pay’ angle. Just like yours bOb, now talkin bout deluded…….
    You should team up with Shadbolt, isn’t he down South with you, he likes wet cement too

    Like

  23. Dave Kennedy says:

    Southern, no economy or country is perfect but when one looks at the Scandinavian model of higher taxation and a higher level of Govt funded services the outcomes tend to be better than the US model of user pays and private provision. In fact the US health care system is one of the most expensive in the world. There is a balance to be had between in the levels of public or private provision and my personal opinion is that for health and education, public services tend to be cheaper and have higher ethical standards. You only have to look at Kidicorp, that are subsidized by this Government, to see what can happen. Kidicorp ripped the Ministry off by $1.6 million in false records and yet they are still being subsidized to set up in low decile communities. Supporting and resourcing community based centres and Kindergartens would be much cheaper and have higher quality in the end.

    Like

  24. Mr E says:

    Dave,
    Do you care to comment on the appropriateness on government candidates attacking private enterprise (stock market listed) on a public media forum. Singling out individuals who are unlikely to have a right of reply. Is this the principled Green Party we are to expect?

    After you have done that, perhaps you might care to explain how a 11.8cent dividend per share paid out to Ryman share holders represents profiteering when shares are currently valued at $7.95. Is 1.5 percent return on investment really profiteering Dave. Or do you think share holders of Ryman should make no profits from investment?

    To best honest when I read your recent comments I find myself cringing. Cringing for those you seemingly thoughtlessly accuse of underhanded behaviour. Could it be back stabbing at a horrid level? Have you spoken to anyone at Ryman before you thought to publicly drag them over the coals?

    Like

  25. Dave Kennedy says:

    Mr E, Kidicorp’s misbehaviour is public knowledge and was widely reported at the time. http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10812634
    This was a substantial amount of public money and yet I don’t think you would have protested if I had outed a fraudulent beneficiary.

    I have no problems with Ryman making some profits as long as they are not generated on the backs of exploited workers. Rest homes, including Rymans have had issues regarding staffing and care provided. Often money that should go to staffing goes to the buildings that will attract clients.

    This was in a report 12 months ago:

    “One of them is Ryman Healthcare. Ryman owns the Malvina Major Home, of Dominion Post fame, where a confused elderly woman was repeatedly left lying in her own faeces.”

    “In the 1980s and 1990s, there were legal minimum staffing levels for homes like this. But in 2002, deregulation removed minimum staffing requirements.”

    “Ryman Healthcare receives $800 million a year from the taxpayer. How much of this goes straight into the pockets of investors is unknown, as the company is not obliged to account for this public money.”

    “It is known, however, that on night shifts they employ just one or two nurses to look after the 200 residents at Malvina Major. Is it any wonder that residents are sometimes neglected?”

    http://www.scoop.co.nz/stories/HL1309/S00227/putting-the-care-into-aged-care.htm

    It is important that the like of myself ensure that public money is being well spent, to say that questioning private businesses use of public funds when evidence provides concern is nonsense. I make no qualms about putting the interests of vulnerable kids and the elderly above a few shareholders profits and that is possibly the difference between myself and some who comment here. I the likes of myself don’t speak out who will?

    Like

  26. Dave Kennedy says:

    “If the likes of myself…” in last sentence.

    Like

  27. TraceyS says:

    “I guess you could say that increasing wages by 60c every six months is rash and extreme, but I wouldn’t (and it’s over 3 years not two)”.

    No it isn’t over three years. Excluding the 2014 movements, it will go from $15 as at 31/3/15 to $18 on 1/4/17.

    Taking the minimum wage to $15 in December 2014, given the increase of $0.50 already this year, will make for an increase of $1.25 this calendar year. Therefore the increases will be:

    Mar 2014 to Apr 2015: $2.25 ($0.50 on 1/4/14: $0.75 on 1/12/14 and $1.00 on 1/4/15)
    Apr 2016: $1.00
    Apr 2017: $1.00

    So the increase over three years is actually $4.25 (ie. in March 2014 the min wage was $13.75 and on 1 April 2017 it will be $18.00).

    I make that $1.42 per year. That’s unprecedented.

    In the 13 years from March 2000 to April 2014 the average increase was $0.48 per year. The median increase was $0.50 per year. The range was from $0.15 to $1.00 per year (and it has only been $1.00 ONCE over that whole period). Most of that time period was represented by a Labour Government. Which makes your policy seem even more outlandish.

    The only reason Labour would support it is being safe in the knowledge that they probably won’t have to implement it.

    Like

  28. TraceyS says:

    “The businesses that do best from an increase in the minimum wage are actually SMEs who benefit from the increase in discretionary spending.”

    Nonsense. What about all the SME’s out there that are business to business? They don’t necessarily benefit from increased consumer spending.

    I can’t actually believe what I’m reading when I see a hopeful Green candidate promoting discretionary consumer spending. Think cheap plastic cr*p from China. Great for the poor old environment aye Dave? Remember the environment?

    Raising the minimum wage to $18.00 so rapidly will mess with the pay relativity of jobs in the $20-$22 per hour bracket or thereabouts. Which is a great many. This will force employers to raise pay rates of employees in those brackets.

    What rights have you to do this? None!

    Nor shall you get any.

    Only then may you understand that this policy is extreme.

    Like

  29. Dave Kennedy says:

    Tracey, just remember that a large number of workers on the minimum wage are casual and part-time workers and the real costs per worker are much lower than you are probably accounting for.

    I attended a union meeting for supermarket employees recently and they were told by their employer that they may lose their jobs if the minimum wage goes up. In actual fact supermarkets will benefit most from the extra spending and will see a substantial increase in profits. Scare tactics from many large employers are shocking.

    The minimum wage went up to $14.25 in April. Over more than 3.5 years we will increase the minimum wage by $3.75. For someone working 40 hours a week that will mean an increase of about $1,600 a year (after tax). Compare that with what Government consultants get paid for restaurant meals and drinks for a few weeks’ work.

    http://www.stuff.co.nz/national/politics/7327570/Money-for-mates-claims-to-be-probed-says-PM

    Almost 50% of all workers got no pay rise at all last year, it’s about time we had more equity in what people are paid for honest work.

    Like

  30. TraceyS says:

    “…just remember that a large number of workers on the minimum wage are casual and part-time workers and the real costs per worker are much lower than you are probably accounting for.”

    I’m afraid that you appear to have completely missed my point which was that if you forcibly and rapidly raise what an employer must pay the cleaner or shop assistant from say $15/hr to $18/hr, the skilled labourer or technical assistant or office worker currently on say $20-22/hr is going to be looking for $27/hr and employers will be pressured to raise their wages or accept that these roles are no longer worth much of a differential. To allow the Government to foist a values change upon your business would be disastrous so many businesses will be left with little choice but to raise the wages of everyone else.

    But then you know this don’t you Dave. The unions (most of them anyway) have failed to negotiate decent wage progression since deregulation of the labour relations environment in 1991. So now you are proposing to force wages upwards through direct Government intervention using the minimum wage as a vehicle. What you are proposing is effectively collective bargaining at a national level by stealth. It’s a misuse of the minimum wage which is supposed to be a basic safeguard – a safety net

    I consider this sneaky, devious, and dangerous. And should it pan out as I have suggested it will – does nothing to help the minimum-wagers as everything will rise relatively.

    Fools we are indeed.

    Like

  31. Dave Kennedy says:

    Tracey, you are right, since the 90s the union movement has been gutted and most of those who haven’t had pay rises are not unionised. If there is no one representing most low income earners and employers have continuously refused to pass on the profits from increased productivity then the Government needs to assist. If we didn’t have the current minimum wage many would be paid far less as was seen in supermarkets when they immediately cut the pay of their youth workers to the lower youth rate when it came in. Lifting pay to at least a livable one is paramount especially when it is costing taxpayers $3 billion a year to subsidise low wages with Working for families. If a business’ margins are so tight that they can’t pay employees a livable wage then perhaps they shouldn’t be an employer. I cannot see why I can set up a business and claim limited revenue and pay well below what a job is worth and have the government subsidise wages for me. That is what many large employers are doing. You cannot tell me that a skilled and experienced rest home worker should be paid at the same rate as a school leaver after 20 years in the job.

    http://www.nzdoctor.co.nz/news/2014/august-2014/26/aged-care-funding-boost-no-guarantee-of-pay-rise-–-nzno.aspx

    http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11126601

    Like

  32. Mr E says:

    Dave,
    Please explain what kidicorp has to do with Ryman.

    “One of them is Ryman Healthcare. Ryman owns the Malvina Major Home, of Dominion Post fame, where a confused elderly woman was repeatedly left lying in her own faeces.”

    Please explain what this has to do with the minimum wage or minimum staffing levels.

    “In the 1980s and 1990s, there were legal minimum staffing levels for homes like this. But in 2002, deregulation removed minimum staffing requirements.”

    Please explain how this is evidence that Ryman under staff.

    “Ryman Healthcare receives $800 million a year from the taxpayer. How much of this goes straight into the pockets of investors is unknown, as the company is not obliged to account for this public money.”

    I’ve told you Dave, 11.8cents was the dividend. Ryman are listed on the NZX and have a responsibility to report their dividend. At a 1.5% return on investment do you really think Ryman investors are pocketing scandalous amounts of tax payer cash?

    Come on Dave. You’re drawing scandalous conclusions from information so weak I would not even call it circumstantial evidence. I would call it irrelevant facts. And you have named private individuals in doing so. Is this how you would act if voted into government. Creating scandal out of irrelevant facts?

    Is this honestly what you call principled Greens behaviour?

    Like

  33. Paranormal says:

    DK says – “Henry Ford would disagree :-)”

    And there’s the rub isn’t it. Lets look into this a little more shall we? Henry Ford was able to improve productivity (you might want to look into that and understand what it was Ford actually achieved), Consequently profits improved so he was able to afford to give back to his employees. Whereas the Greens think they can play Robin Hood and just do it.

    So the Greens once over superficial use of Henry Ford as an example has no evidential basis in reality, but they’re going to do it anyway. The title of this post sums up your reality.

    Like

  34. Dave Kennedy says:

    Sorry, Mr E, I don’t seem to be communicating particularly well. I thought you were criticizing me for making negative comments about two companies when it may effect the value of their shares and reduce the returns for share holders: “the appropriateness on government candidates attacking private enterprise (stock market listed) on a public media forum.” You also claimed that they had no right of reply.

    I showed in my response that my criticisms involved issues already in the public arena and both involved misuse of public funds.

    The article that I linked to regarding Ryman clearly explained that staffing was an issue when only 2 nurses were available for 200 high needs residents. in one home. There was also no requirement to account for the $800 million of state funding. It isn’t so much the money that ends up in the pockets of investors but more about what goes to directors, managers and buildings and not to the low paid staff who actually do the real frontline work.

    I’m sorry I haven’t explained this well perhaps you could read Consumer NZs review of the aged care industry, it’s pretty horrific.

    Like

  35. Mr E says:

    Dave,
    Evidence of “misuse of public funds” please. These are big allegations you are making. You’ve provided evidence that is at best circumstantial.

    There are plenty of issues that make the “public arena” does that make it “principled” to comment on all? Particularly when it involves identifying individuals, making offensive accusations, and using weak connections to do so. You apparently didn’t like being singled out on the Whale Oil blog, now seemingly hypocritically you have singled out 2 private individuals for a scandalous attack.

    You seem to be accusing Ryman of disproportionately directing monies to directors, managers, and buildings. Evidence please.

    Like

  36. TraceyS says:

    “If a business’ margins are so tight that they can’t pay employees a livable wage then perhaps they shouldn’t be an employer.”

    Whoa that is haughty! Many new businesses will not make much, if any money, for a start. And unexpected things can happen at any time through which employers have to try and maintain wage levels if they are wishing to carry on. If maintaining a higher level of wages, job cuts are likely to come sooner. In real businesses, tight times are quite normal. For some it lasts longer than they’d hope or ever intend.

    “I cannot see why I can set up a business and claim limited revenue and pay well below what a job is worth and have the government subsidise wages for me.”

    You can’t? Wow, have you never considered that jobs are a social good, even low-paid ones? Are those people better off on the dole than in low-paid jobs? Ever been unemployed, Dave? I have.

    If you can’t understand stuff, Dave, you need to get out amongst it. And I don’t just mean some holiday job or other temporary stint. Become what you don’t understand and then you will truly have insight. And where you don’t have insight, for example in business, you’d best be prepared to listen to those who do.

    Like

  37. Dave Kennedy says:

    http://www.stuff.co.nz/dominion-post/news/8983240/Rest-home-audited-after-neglect-claims

    http://wellington.scoop.co.nz/?p=57873

    http://www.insitemagazine.co.nz/news-feed/august-2013/editorial-the-elephant-in-the-room/#.VA5JtEtFRnI

    RymanHealthcare made an 18% gain in profit in the last financial year, directors fees are $640,000 up $120,000 from the previous year (almost a 20% increase). Workers are still on minimum wages and increases have been minimal. It does appear that the wages of the workers are a lower priority than what is being paid to shareholders and directors.

    http://www.rymanhealthcare.co.nz/annual-report-2014/book/9?page=1

    You can try and imply I am no different from Cameron Slater, but he tried to take down people who challenged corporate profits especially those businesses that profited from causing social harm (the tobacco and alcohol industries).

    What scandalous attack did I make on anyone other than suggesting that the personal gain in wealth from those whose wealth was generated from the aged care industry would easily lift the wages of the rest home workers without causing much hardship? All I am doing is challenging priorities, I haven’t implied dishonesty or corruption or made personal attacks.

    Like

  38. Dave Kennedy says:

    Also the rest home industry demands that it is reasonable to expect 15% growth in profits each year, this is well above inflation and the main way of ensuring profits is keeping wages unnaturally low. When the Government subidises this industry by a substantial amount ($800 million to Ryman) I think giving large increases to directors and not to the frontline workers is missuse of funding. This is my personal opinion and is supported by their own Annual report. I am happy to be be challenged on the evidence but I am not the only one who has this view.

    Like

  39. Paranormal says:

    DK – are you sure you’ve got that right? 15% growth on profits year on year? Did you perhaps mean 15% return on investment/capital?

    Without wasting my time to look up another of your dubious claims it appears your commercial ignorance is showing again.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

<span>%d</span> bloggers like this: