Cullen and Manufacturers

Stuff's Colin Espinor and the Herald are making much of the poor turnout to hear Finance Minister, Michael Cullen's pre-budget address to the Canterbury Manufacturers Association lunch in Christchurch.

Maybe the phone is off the hook with respect to Labour. It's tough times in New Zealand for manufacturers. The low US dollar they insist on pricing everything in has been a real problem for them. The competition from manufacturers in much larger countries with 3rd-world labour laws and better access to markets and capital has been crushing. Maybe there aren't many manufacturers left in Canterbury to attend.

But I honestly can't see how local manufacturers could get any more excited by the prospect of a National-lead government later this year. That party is even more committed to free trade and open markets - especially the China deal - than Labour is.

There can't be any real benefit from that quarter for local manufacturers. Trimming a little "red tape" by exposing the environment to renewed plundering and spoilage won't save much money for manufacturers.

How can National credibly enact policies to force wages down even further when criticising the present government for not doing enough to see wages rise? My eldest daughter's employer is already refusing to pay the legal minimum wage and my daughter begs me not to say anything lest they not give her a good reference if she should decide to leave that job. So they get away with breaking the law and low-balling a teenager who works hard.

As for tax cuts, the banks and the oil companies will soak those up in 15 minutes flat via interest rates and petrol prices and thanks to the lower tax take, services will be reduced, enforcement will be gutted and we'll all have to pay more and higher user fees and larger health care costs out of what's left, reducing our already shrinking disposable incomes. What good is a tax cut if the Reserve Bank of New Zealand can deem it inflationary and confiscate the money right back off you and transfer it to the commercial banks via higher interest rates. If that fails, the RBNZ can cut interest rates, the NZ dollar falls and our buying power for all the imported stuff we used to make here takes another hit. Tax is the least of our worries. It's close to being a red herring.

People can be perverse. Maybe the Canterbury Manufacturers Association should all be NZ First or Green Party supporters. Both have policies more in tune with the needs of local manufacturers than National or Labour, who will (apparently) hold to current policies until the last local manufacturer in NZ turns out the lights and moves to China, Mexico or those special export zones in Thailand where the usual labour laws don't apply.

Those "Buy Kiwi Made" ads should soon be changed to "Find Kiwi Made". It's getting harder to do that.

[UPDATE 2008-05-20: Audrey Young's blog gives a hint as to the most likely reason for the poor turnout for Cullen's recent speech:

His long-serving private secretary Kim McKenzie departed suddenly, apparently after a dispute of some sort - unrelated to the Budget. (He said today that she had not been sacked and was on leave and did not know if she was returning).

His traditional pre-Budget speech to the Canterbury Manufacturers’ Association drew a pitiful audience of 36.

Clark noted on Newstalk ZB this morning that the person organising it should have been shot given the fact that she had given a speech there only two weeks previously to a packed audience - wherein may lie the reason.

Little wonder that Cullen’s office is quick to say that his post-Budget speech on Friday to the Wellington Chamber of Commerce is a sell-out - sorry, is sold out - with 85 acceptances for tickets at $60 a head.

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