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Posts Tagged ‘Business

The Seeds of 21st Century Socialism?

I’ll finish off this series on where Socialism might be going in the future by putting out an example of how thinking on capitalism may be changing with the generations.

Coming of age in the 1980’s meant passing through the world of Thatcher, Reagan and, here in New Zealand, Roger Douglas. A world of privatisation of government-owned businesses, deregulation and the general encouragement to get out there and make big bucks.

All of this was more than just a political moment. It was cultural as well. There were TV characters like Alex Keaton of Family Ties, who appalled his Baby Boomer, hippie-values parents with his Right-Wing, pro-business attitudes, as well as keeping a framed photo of Nixon beside his bed. The series was pitched to studio as “Hip parents, square kids“: some things never change. Then there were movies like Risky Business and The Secret of My SuccessWorking GirlTrading Places, among many others.

But the one that probably had the biggest impact was Wall Street in 1987, Oliver Stone’s acidic take on the 1980’s financial world. 

And of all the scenes in the movie it’s the following one that has stuck in people’s minds, as actor Michael Douglas chews up the scenery on his way to winning the Oscar for Best Actor as Gordon Gekko, giving the famous “Greed is Good” speech explaining to the stockholders of Teldar Paper exactly how the company’s management has screwed them over while creaming it themselves.

It certainly is a speech for the ages, and to the horror of Stone and Douglas, has resulted in countless people telling them over the years that it’s the reason they got into financial trading.

America has become a second-rate power. Its trade deficit and its fiscal deficit are at nightmare proportions. 

2020: Hold my beer!

Now, in the days of the free market, when our country was a top industrial power,..

Sound familiar with any recent political rhetoric? Paens to an American past:
 
The Carnegies, the Mellons, the men that built this great industrial empire, made sure of it because it was their money at stake. Today, management has no stake in the company!
And in a strange way, perhaps because of Stone’s beliefs, he puts words into the mouth of a corporate raider that might have come from any enraged Socialist raging against the Rich: 
… you are all being royally screwed over by these,…. these bureaucrats, with their steak lunches, their hunting and fishing trips, their corporate jets and golden parachutes.

… our paper company lost 110 million dollars last year, and I’ll bet that half of that was spent in all the paperwork going back and forth between all these vice presidents. 

A few years later in 1991, came a movie that I regard as superior to Wall StreetOther People’s Money. It never made as big an impact, perhaps because the moment had passed, it originally being a play written in 1987.
.

As in the former movie one of the key points occurs during a stockholders meeting as an old company, New England Wire & Cable, tries to fight off another corporate raider, this time Larry “The Liquidator“Garfield, played with deliciously brazen evil by Danny DeVito. 

 
There are two scenes here, the first where the Chairman of the Board, Andrew Jorgenson, played by the great Gregory Peck, pleads – in fact almost begs – the stockholders not to sell. Like Gordon Gecko he too appeals to a past America, but the nature of the appeal is different and I’ve always thought that Peck, in what would be his last prominent role, could have written the words himself, as one of the Old Guard Left in Hollywood who believed in FDR’s New Deal, most other Left-Wing causes and who was publicly appalled by the Age of Reagan.
 
 

There is the instrument of our destruction. I want you to look at him in all of his glory, Larry “The Liquidator,” the entrepreneur of post-industrial America, playing God with other people’s money. 

The Robber Barons of old at least left something tangible in their wake — a coal mine, a railroad, banks. 

So it’s not just corporate raiders making that appeal. But Jorgenson, calls out to something that Gekko does not.

God save us if we vote to take his paltry few dollars and run. God save this country if that is truly the wave of the future. We will then have become a nation that makes nothing but hamburgers, creates nothing but lawyers, and sells nothing but tax shelters. 

And if we are at that point in this country, where we kill something because at the moment it’s worth more dead than alive — well, take a look around. Look at your neighbor. Look at your neighbor. You won’t kill him, will you? No. It’s called murder and it’s illegal. Well, this too is murder — on a mass scale. Only on Wall Street, they call it “maximizing share-holder value” and they call it “legal.” And they substitute dollar bills where a conscience should be. 

Dammit! A business is worth more than the price of its stock. It’s the place where we earn our living, where we meet our friends, dream our dreams. It is, in every sense, the very fabric that binds our society together.

I was lucky enough to see the original play in a Chicago run and during this speech the guy playing Larry The Liquidator – who was built more like Pavarotti than DeVito – would stroll up and down the aisles of the audience and burst into songs from the musical Oklahoma and other classics. It was an excellent way of showing the contempt he held for Jorgenson.

Larry gets his turn to respond and unwinds one of the greatest pro-capitalism speeches ever. There’s a better quality clip at this site.

 

You just heard The Prayer for the Dead, my fellow stockholders, and you didn’t say, “Amen.”  

This company is dead. I didn’t kill it. Don’t blame me. It was dead when I got here. It’s too late for prayers.

You know, at one time there must’ve been dozens of companies makin’ buggy whips. And I’ll bet the last company around was the one that made the best goddamn buggy whip you ever saw. Now how would you have liked to have been a stockholder in that company?
 

You invested in a business and this business is dead. Let’s have the intelligence, let’s have the decency to sign the death certificate, collect the insurance, and invest in something with a future.

I’ve actually sat in one or two meetings where the buggy whip analogy was used, though luckily about systems rather than entire companies. 

“Ah, but we can’t,” goes the prayer. “We can’t because we have responsibility, a responsibility to our employees, to our community. What will happen to them?” I got two words for that: 

Who cares? 

Care about them? Why? They didn’t care about you. 

They sucked you dry. You have no responsibility to them. For the last ten years this company bled your money. Did this community ever say, “We know times are tough. We’ll lower taxes, reduce water and sewer.” Check it out: You’re paying twice what you did ten years ago. And our devoted employees, who have taken no increases for the past three years, are still making twice what they made ten years ago; and our stock — one-sixth what it was ten years ago.

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The reason I’ve put these clips up, plus the 1980’s background, is that a couple of weeks ago my kids had some of their friends around for a post-lockdown catchup and they watched a couple of movies. They’re all into Media Studies and History and Mathematics and Science and so forth, but not Economics. They’re interesting to talk to, so I showed them these three clips – none of them had ever seen either movie – and asked them what they thought of the ideas and arguments expressed in each.

  • The Wall Street clip elicited anger at the useless, fat-cat managers of Teldar while knowing that Gekko was obviously just using those sentiments to screw people and make money for himself. They didn’t admire him one bit.
  • The first OPM clip caused rolled eyes. Yes, Jorgenson seemed like a decent man but all this mythologising of the past and the idea of a company being the centre of a community just seemed unlikely. But (shrugged shoulders) if it worked for people then why not try to save it?
  • But the second OPM clip with DeVito’s speech brought forth anger: real hatred of the character and what he was about to do. Why could the company not be saved? Why could investments not be made to grab those new opportunities in fibre optics and the like? Why did it have to be destroyed? What would happen to the town that depended upon it?
I was fascinated by these reactions, which were mostly the exact opposite of me and my peers when we watched these movies thirty and more years ago.

 

I also informed them that, as with most Hollywood fantasies, the dream is saved at the end of Other People’s Money: investment is found to make hi-tech metal fibres for airbags.

By contrast the play had no such happy ending, only grim reality. Larry takes over and the company shuts down. The jobs, and likely the town, go with it. He even gets the girl at the end.

So there you are. A new generation that thinks somewhat differently than I do about capitalism, free enterprise, free trade and local communities, including nations. Perhaps the socialism of the 21st century will have new soil in which to grow and new seeds from which to raise warriors for the working day.

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See Also:
 
Fully Automated Luxury Communism

Written by Tom Hunter

July 1, 2020 at 6:00 pm

Make New Zealand Great Again

My Photo

Old Trottsky has been hammering away again on his dream of New Zealand retreating back to the Golden Weather of his childhood – sans all the social conservatism that was actually a key part of making that socialism possible, starting with social shaming.

Like Marx himself Trott’s has very few specific ideas of what exactly is needed to make New Zealand Great Again but like his compatriot Bradbury and others it seems to involve the rebirth of huge government-owned businesses like the Ministry of Works, in concert with government approved private corporations like the old Fletcher Challenge, all bound together with massive unionisation and lots of regulations to keep an eye on the greedy seekers of profit. Not so strangely – if you understand anything about Old Lefties like Trott’s – is the accompanying fantasy of a strong military than can kick some butt when needed by “The People’s Dictatorship“.

As far as the rest of the private sector is concerned – yes Virginia, we’re not talking Communism here, let’s give him credit for that – his suggestions are based on this key assumption:

That strange combination of creativity, thrill-seeking and greed, which propels the entrepreneur towards new ventures will soon respond to new incentives and new opportunities.

Gosh! Greed is good, as they say. Who knew?

As always with Leftists, other key factors for entrepreneurs are ignored in Trotter’s world of a government that only does good, huge, positive things as it dominates the landscape.

What he misses in his ode to Big Government is the most basic thing desired by entrepreneurs from government:

a high degree of certainty in government plans, at least in the near future, and a willingness to leave them the fuck alone.

It’s tough enough coping with and balancing all the things that go into a business – all the carefully laid plans that have to be modified quickly, sometimes drastically, or even scrapped in the face of market changes. All the things both little and big that change almost daily.

But it becomes so much tougher when, in the back of your mind, you have no idea what’s coming down the road from government in terms of rules and regulations, taxes, interest rates and general bureaucracy, that last often based more on some local official’s whims than the black-letter law that government thought it had passed.

And like any eco-system, these effects often take years or decades to become apparent. I would suggest that NZ’s hopeless lack of productivity over the decades – which shows up in us working more hours per year just to keep up with the Aussies – is down to the fact that, for all our politicians bloviating about entrepreneurs and the like, we simply have not provided an environment of government laws and regulations that’s stable enough to compensate for all those other market factors.

As a result our entrepreneurial class has steadily dwindled as such people have given up and fled overseas over the decades.

And that’s before we get to the current disaster. What trust has any entrepreneur got that this won’t happen again soon, with COVID-25 or whatever? And there is no hope that a National government would be different. They may be picking away now at various scabs of technical failure, but they supported it all from the start, craven cowards that they are.

So perhaps we will see a return to the world Trotter so loves: the NZ of 1935-1984 where one slogged along to a dull, boring job in some great government approved corporation like Fletchers or some godforsaken government department like the MOW or NZ Rail, all of it enabled by government micro-management whose final exemplar was RD Muldoon.

I vividly recall those end days in the early 1980s, before Rogernomics. I and every one of my varsity peers hated it all; we hated it even more when we got summer jobs in those places and saw our futures laid out before us in promotions from Level PL6 (Programmer Learner) to Level PL7. And time and again, when asked why we would not turn those summer jobs into permanent positions, they could never understand our responses. In fact they looked at us with incomprehension. It’s one of the reasons so many of us fled on the big OE and never returned, or did so only when we were married with kids and had piled up enough money that we could be somewhat shielded from the Kiwi disease.

And we can see all this in just one of Trotter’s ideas, this for tourism-replacement:

Let’s invest in movies, television series, plays, music, novels, computer games. Encourage the world to partake of New Zealand’s unique creativity

What? 21st century re-boots of 1970’s Public TV cringe-fests like Buck House and other equally unfunny comedies that totally lack in “unique creativity”. I saw nothing funny about it and others like it as a child and assumed it was because I was too young to get it. But over a decade later I would sit in a NZ History class viewing such period gems and finding that not only was I not laughing but neither was anyone else in the room. And this at a time when we were laughing our heads off at the distinctly NZ humour of Bad Taste.

And who was behind that? An unknown, no-account movie maker named Peter Jackson. Bad Taste was held to be “appalling” for it’s combination of black humour and splatter-horror. And nothing changed in the next few years.

I can still vividly recall some ponce at the Wellington Movie Festival sniffily telling a TV interviewer that they were not going to list Jackson’s next movie Meet The Feebles because “nobody wants to see puppets farting and covered with gore“.

And that guy was no 60 year old Christian Conservative but a trendy, arty type in his 40’s or so who perfectly represented the NZ “ART” scene. It was no surprise that Jackson basically got kicked in the teeth by that community and hence by related government “support” for years before making it big thanks to US investors.

And that’s the New Zealand attitude towards entrepreneurs in a nutshell. That’s why they have to make it overseas first, and we have to hope to god that they bring the talent and the money back to NZ, as Jackson has done with this huge Weta Workshops company sprawled amidst the old abandoned commercial and industrial warehouses of Mirimar.

I don’t see anything concrete in the suggestions of Trotter or any other Lefty, let alone their idols, Robertson and St Jacinda of Corona (h/t PM of NZ), that would have helped Jackson then or a similar person now. In fact Jackson has become something of a hate figure on the NZ Left over the issue of unions, a facet of our current government that its supporters are drooling to strengthen.

Not doing so many government things is the key: things not to be done, before any possible positive things, like incentives around venture capitalists and investment, can be discussed. Things not to be done by direct government investment or “R&D incentives” and the sort of subsidy schemes and government-sponsored awards and stuff that was around when Jackson started but which he barely saw because they always get captured by special interest groups whose Group Think is anathema to the likes of Jackson.

Trotter himself tripped over the reality of this several years ago when he bemoaned the fall of John Campbell on TV3:

It is one of the great ironies of New Zealand’s (relatively) recent cultural history that the impetus towards free and open airways has, to a startling degree, come from freewheeling cultural entrepreneurs like Colin Scrimgeour, Gordon Dryden, George Andrews, Marcia Russell and Rod Pedersen. Not forgetting that madcap piratical quartet who, in 1966, launched Radio Hauraki.

Oh it’s an IRONY is it Chris? That TV3, the private-sector network driven by greed would actually end up being the one that pushed progressive news and themes the hardest. And this:

One of the strangest aspects of New Zealand’s deeply conformist society is the way it drives so many of its non-conforming citizens into the private sector. Not, it must be said, in the spirit of avarice that makes true capitalists rich, but because it seemed to them about the only place where it was possible to set up an institution capable of saying “Yes”.

That’s the final joke arising from Trotter’s suggestions about the Great Things Government Can Do for entrepreneurs in the wake of the Sino Sinus Disease, and what is really the only lesson and thing they actually need to do for all the talk of “new incentives and new opportunities.

Stop saying “No” and get out of the fucking way.

Written by Tom Hunter

May 10, 2020 at 1:47 am

NEW ZEALAND … THE WAY YOU’VE GOT IT

A little while ago I suggested we were entering into dangerous territory when any criticism of the Government over their handing of the Covid-19 crisis was slammed as bordering on the irresponsible … that the ‘greater good’ was the overriding factor.

The last few days has seen that play out.    Simon Bridges was taken to task by the media (with not so gentle prodding from Grant Robertson) for suggesting that extending the lock-down would most likely see further business closures.  He was particularly scathing of Jacinda Ardern’s comment that extending the lock-down by five days meant only two days loss of business.    That was fair comment … just which part of planet business does Labour occupy for Ardern to make such a stupid assertion.   But no, Ardern knows best.   Her vast business knowledge gained from wrapping fish & chips trumps rational debate.

Then we had the quite extraordinary outburst from one of Labour’s supposed bright young up and comers that really business had only itself to blame if they failed to weather the storm … meant they were undercapitalised and it was all their fault.   Yep, Labour sure understands business … not.

Instructive too that Barely Sober, fresh from his drubbing by Mr Justice Venning who denied him expert witness status in Peters vs ‘Everyone’ and dismissed his assertions as opinion and not evidence has come out in support of the criticism leveled by Bridges.     Many would have it that Soper is the mouthpiece for Peters and that makes for an interesting dynamic.   Clearly there are tensions in cabinet.   That goes with the territory when Ardern is able to function as a virtual dictator.   

500,000 back to work on Tuesday.    Who’s kidding who?   Judith Collins has it about right.   Level 3 is really Level 4 with KFC an optional extra.    We need to get to Level 2 sooner rather than later.   Right now it appears the government is intent on destroying the village in order to save it. 

Written by The Veteran

April 23, 2020 at 3:52 am

Filed under "big whoop."

Even so the MSM journalists are not even trying to hide their bias in favour of the public sector, likely because it’s so engrained in their thinking that it’s just unconscious now.

And naturally this is also why almost all other MSM reporting runs the same way on so many issues: Anderson Cooper is not an exception. It’s not thinking bias, which would be bad enough, but simple herd behaviour.

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And in other similar news, Bernie Sanders finally suspended his campaign a couple of days ago, so Biden will now be the Democrat Party nominee for President. It’s been obvious for over a month now that Bernie was just not going to make it and likely only his stubborness kept him going even this long. But the inability to campaign because of the virus was what finally stopped him cold.

The whole business of “suspension” rather than just quitting has more to do with campaign financing laws nowadays. The FEC doesn’t consider a campaign to be done and dusted until its debts are paid, cash dumped into other accounts and the whole thing tidied up, which usually means that some donating is still required. Of course it does also allow a campaign to roar back to life if something changes, but that’s not the primary reason.

The whole thing is a huge indictment of the quality of the other Democrat candidates, given Biden’s terrible weaknesses that I outlined last year here and here – and he’s got visibly worse since then as the following collection of video clips shows.

 

And all this in just about the most controlled environment that a politician can get. Sure, Biden got through the campaign debates so perhaps this is all just lowering expectations for the debates against Trump. Simply being his old, word-salad self could be regarded as a win. But there are surely limits on how low that bar can be set?

How on earth could the rest not do at least as well as Bernie in at even staying the distance? Sure, each one had weaknesses, but they also had strengths compared to both Biden and Sanders. It probably is similar to the 2016 GOP process, where the favoured candidates spent so much time beating on eachother that Trump could slip through, and in the final stages of this campaign Bernie showed he was unwilling to go for the throat, just as in 2016 against Hillary.

But it’s also an indictment of the entire Democrat “establishment” – the incestuous little world of activists, donors, party chiefs and seated politicians. They’re the ones who gave up on the other alternatives to Sanders and decided to pick up a flailing Biden and push him over the line on Super Tuesday. He won in states where he’d not even campaigned and where he’d spent almost no money, largely because his campaign was almost broke.

The hard line Leftists at the magazine Jacobin are not happy, as can be seen in this article, Voters Won’t Risk Their Lives for Joe Biden:

No one will fight for this man. No one will risk their lives for this man. In 2020, faced with a raging pandemic on one hand and the hopeless politics of the Democratic Party on the other, voters will once more decide, wisely, to stay at home.

Normally I would dismiss such anger because it’s the natural aftermath when a favoured candidate loses. Such people, after letting off steam, usually drift through the Kubler-Ross stages and vote for the Party’s nominee.

But one of the many problems the Democrats face is that having their voters staying home is exactly what happened in 2016 with Hillary Clinton. Granted Biden is not hated by many Democrats as Hillary was. On the contrary he’s quite beloved. But as the Jacobin article shows, that feeling is not the sort of enthusiastic belovedness attending Obama. It’s more that Democrats regard Biden as one might a silly old Uncle: “That’s just Joe” has been the refrain for years now.

Combine that attitude among many Democrat voters with the more hard-edged disdain of the Bernie Bros, Trump’s rising approval ratings thanks to the Wuhan Virus pandemic, the massive carpet bombing attacks the GOP will unleash on Biden, and Trump’s total willingness to rip into his opponent’s weakest spots, and it looks like a huge uphill struggle for Biden, and this time the DNC can’t get him across the line by itself.

As expected the Trump campaign was quick off the mark with the following video, which hits all the right marks, given what’s on people’s minds right now.

Biden Stands Up for China.
 
 

Not Many People Beat The Bank

Sub-title:-    Stupid, Stupid ANZ

Sub sub-title:-  Curry Munchers screw Fosters Guzzlers

Here’s an extraordinary story of a successful child bride.

She made the most of her arranged marriage to what appears to be a reasonably thick chap and after a six year battle with ANZ Banking Group, walked away with a cheque for $200 million.

(Paywall)

“They beat the bank and now they’re gone — perhaps never to return.

Indian business couple Pankaj and Radhika Oswal left Australia last Thursday, immediately after settling a multi-billion-dollar legal stoush with the ANZ bank for $200 million, and are thinking of starting a new life in New York.

Ms Oswal said yesterday the couple would sell the land on which sits their unfinished Perth mansion, known as “Taj On Swan”.  The ruin in up-market Pepper­mint Grove will be demolished next Monday by order of the local council.

Among options for “brighter futures”, Ms Oswal was “thinking about starting a not-for-profit ­organisation devoted to women’s empowerment, particularly for those living in countries like India where there are historic and ­cultural limitations on women achieving their potential”.
Ms Oswal said the couple had “great memories of our lives in Australia before the problems arose with ANZ and the ­receivers PPB Advisory, but the last six years have been very painful and emotionally draining, so it is time to start a new chapter in our lives”.

The Victorian Supreme Court battle between the Oswals and ANZ, which played out over 11 weeks of hearings, revolved around the bank’s sale of the ­couple’s Burrup Fertiliser business in 2010.
The Oswals alleged that ANZ and PPB, which the bank ­appointed as receivers over Burrup, sold their stake in the business for less than it was worth after seizing it in a row over about $1 billion in debts they owed ANZ.  In turn, ANZ accused the ­couple of misappropriating about $150m, spent on luxury cars, a boat, property including the Taj on Swan and Ms Oswal’s veget­arian restaurant chain Otarian.

After a month of ­mediation ­before associate judge John ­Efthim, the two sides agreed to a confidential deal in which ANZ agreed to pay the Oswals more than $200m.

The talks came after dramatic evidence from Ms Oswal in which she accused her husband of forging documents and claimed that at a December 2009 meeting ANZ general counsel Bob Santamaria said that if she did not give the bank security over the shares in Burrup she owned, the couple would go to jail and their two daughters would be “orphans”.  The Oswals also accused then chief risk officer Chis Page of putting Mr Oswal in a headlock at the meeting and sending a racist email to bank boss Mike Smith. 

ANZ denies the allegations.

Of course the ANZ denied the allegations.  Then they paid up.

Written by adolffinkensen

September 25, 2016 at 10:59 pm

Posted in New Zealand

Tagged with ,