WTF – May 8 2008: Sealord, Tax Cuts, Retirement

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Scoop image – Lyndon Hood
1. Sealord, not Law’ed. How ironic that Sealord – half owned by Maori business interests – was being denounced on RNZ this morning by foreign human rights agencies for co-exploiting the fisheries resources of the indigenous people of Western Sahara. This isn’t the first time Sealord’s business links have triggered accusations of dodgy dealings – remember the charges of their indirect links to whaling earlier this decade, subsequently terminated after a blaze of publicity ?

They might try to ride this one out. After all, this fisheries case isn’t the first time that Phil Goff and the Government have been called on to deter our firms from breaking international law over the exploitation of Western Saharan resources. In mid 2006, Ravensdown availed itself of a phosphate shipment from Western Sahara. In 2006, Goff’s feeble rejoinder of that deal in Parliament ran like this :“I do not think anybody can say with any certainty what the local people in Western Sahara feel about the mining of phosphate resources. I certainly have no evidence about that. I am aware that the independence movement is opposed to that, but I am not aware of what the views of the ordinary people in Western Sahara may be, and how could I be? “

That’s right, Phil. With that attitude, it would have been almost as hard to oppose apartheid wouldn’t it, because – while we knew the views of the ANC movement – who among us REALLY KNEW what the views of the average black person on the streets of South Africa were? Maybe they LIKED apartheid, and maybe Saharawis like being colonised by a country with whom they have almost no shared cultural legacy, and that is ripping off their natural resources ? Who’s to know – right, Phil ?

For the record, New Zealand officially regards Western Sahara as a colonized territory, opposes the Moroccan invasion and occupation, and supports the right of the Saharawi people to have a choice between total independence and limited autonomy under Moroccan rule, in a referendum that was first promised to them 30 years ago, and several times since.

Disclosure : lawyer Moana Jackson and I will be speaking on Monday and Wednesday next week in Wellington at the Human Rights Film Festival screenings of the film “ Western Sahara : Africa’s Last Colony.”

2. Politicising the tax cuts. Also interesting to hear the love fest this morning on RNZ between Pricewaterhouse tax expert John Shewan and Sean Plunket on what a bad idea it would be to exempt the first $9,500 of earnings from income tax, to help the needy, bridge the income gaps and alleviate poverty. On this point, there was no argument with Finance Minister Michael Cullen’s world view, in ruling out the measure. Shewan’s main argument ? That some people would benefit who weren’t needy, since they could arrange their finances to produce little, or no taxable income.

Threadbare stuff. Yes, some people not in genuine need might exploit that advantage. Far more people in genuine need would benefit from an initial $9, 500 exemption. More to the point, they will do better under such an exemption than from an across the board cut in tax rates – a measure that Shewan and his clients would undoubtedly favour, since the bulk of the money will go off to the already relatively well off, while giving the poor a pittance, at best. Most likely, the real reason Finance Minister Michael Cullen has decided against the $9,500 exemption is that it would give the bulk of the tax cuts to people who are either Labour voters already – or non voters – and he has other fish to fry.

Still, it leaves the field free for Tariana Turia to exploit the point in the Maori seats, and elsewhere. As she told Scoop a couple of weeks ago :

Turia….How we’re approaching the whole tax cuts situation is probably different to how we’re being read. What we have felt is that those who under $25,000 a year are the ones who should be receiving the tax cut. In fact, we don’t feel those people should be paying taxes. $25,000 is the poverty line in this country. If someone is earning $500 a week and their take home pay is $400 a week, and their rent is $250- 300 a week… its obviously very difficult for them.
Campbell: So you oppose sweeping tax cuts across the board ?

Turia : Yes, we’re quite specific about that.

Campbell: And for anyone living below a $25,000 poverty level, no tax?

Turia : No tax.

3. Defence, for retirement spending. Phil Rennie of the Centre for Independent Studies arguesthat the $2 billion we are spending on retirement savings is more than the annual spend on our defence forces. Bad comparison, if it is meant to suggest our armed services are going without. They certainly did in the 1990s under National governments, which starved the defence forces of new equipment.

Yet ironically under a centre left government, the annual defence spend this decade has been enough to pay for a major revamp of defence equipment including over a hundred LAVs for the Army, overseas deployments in Timor, Afghanistan and the Gulf, a new EEZ maritime defence fleet AND a brand new Defence HQ building in Wellington. Given that New Zealand doesn’t face any discernible security threat, it makes a lot more sense to prioritise retirement savings, especially when a demographic time bomb ( ie, an ageing population) is headed our way.