The policies of destruction

Rob Hosking at NBR writes:

Has any multi-billion dollar policy ever been made with such an air of frivolity as the Greens/Labour parties’ power plan?

The plan – which would involve interposing a government-run wholesaler into the market to set prices – shaved several hundred million dollars off the value of electricity market companies, taking investors in the New Zealand sharemarket by surprise, if not shock.

It has to be one of the most expensive branding exercises in this country’s history.

For that is all it is.

And one in which taxpayers pay the bill.

There is something essentially frivolous about anyone who would cheerfully rip up the value of some of the country’s largest firms, and the value of the investment in those firms, simply for a political positioning exercise.

This is why the exchange caught by TV3 between Green energy spokesman Gareth Hughes and party spin zambuck Clint Smith was so telling.

For those who missed it, Mr Hughes was asked if the party was pleased at the reaction: Mr Hughes paused, turned to Mr Smith and asked “Hey, Clint – are we pleased?”

It was telling that he even had to ask.

But the almost palpable glee coming out of the Green and Labour camps at the destructive impact of their policy is highly revealing. 

It’s like the little boy who pulls a few stones out of a dam, and giggles when the whole dam collapses.

It underlines – not for the first time – the problem with the makeup of both parties. They are dominated at the MP and the staff level by the sub-genus homo politicus.

That is, they are full of people who have done nothing in their lives apart from politics. All parties have a complement of this group, but with Labour and the Greens the group has reached critical mass.

This group has been involved in politics at university, moved from there to various political/union offices and then into parliament. 

There is little real world experience and everything is viewed through a very narrow prism of political advantage.

It’s the sort of attitude which means the value destruction seen this week can be just laughed off.

There will, unless we are careful, be more such frivolous policies to come.

I think Rob Hosking is dead on with this analysis. You have a growing political class who view things through a unitary prism. If you have never ever worked in the private sector, why would you have any empathy for private businesses? And why would you care about such foreign concepts as cost of capital? Your academic background tells you the solution is just to print more money.

As far as I can tell only two out of Labour’s top 10 have ever had a significant job in the private (business) sector. Think about that.