Monday, August 11, 2008

Minto's interdependent fist of statism

John Minto is in the NZ Herald today cheerleading on forcing you to pay for university students to be able to live so they can then pursue their dream jobs.

This economic illiterate assumes its cost wont result in a massive change in behaviour, discouraging students from working and encouraging people to become students, because someone else is forced to pay. He says:

"The cost would be about $700 million per year. It's about the same as Telecom's annual profit or a quarter of the New Zealand profit of our Australian-owned banks. Another reason why the sale of these core assets is such an ongoing disaster."

Yes, because if Telecom had been state owned it would still generate a reasonable profit right John? Because it was bound to be as efficient. Of course you wouldn't want Telecom reinvesting profits in upgrading technology or services, no. The Australian owned banks, except for the BNZ and part of ANZ were never state owned either, but Minto like many socialists doesn't let the facts get in the way of a good myth.

Compulsory student allowances are not the "community working together", it isn't about people caring and choosing to support one another, it is the leviathan state saying "pay us or else" on the one hand and "you get money or you don't" on the other.

Minto has no interest in diving into his own pocket to help students, he wants to get the state to threaten the money out of yours. It isn't interdependent to tax those who don't cost the state very much to pay for those who always do.

6 comments:

matt b said...

As you point out, Minto's argument that if the government owned the banks and Telecom profits would be unaffected is spurious.

But there's also this point. Even though the government owns zero shares in Telecom, it still takes a third of its profits.

Isn't this the best of all worlds for Minto?

Not one cent of government money is tied up in Telecom shares, Telecom's private owners spin silk into gold where none would otherwise exist, and the government gets a third of the earnings for no money down and at zero risk.

john-ston said...

As a student myself, I am opposed to the idea of a Universal Student Allowance. While the present system has a few flaws, I don't think that we should exactly be giving taxpayers money to all students; we don't know the full circumstances. If we were to keep the present system, then perhaps the best option for students would be to allow students away from home to not have their parent's income tested - that by the way is one of the biggest complaints about the present system.

Of course, even with my slight tweak, there would still be $500 million left over that could be used for improving the quality of our universities, or for tax cuts.

Anonymous said...

It depends on the subject. Students of intellectually rigourous subjects like math, science, and engineering would be worth financing. Those doing "social" or "studies" subjects can pay for their indulgence. How many social scientists (sic) do we need - nowhere near as many as we produce that's for sure. We'd all be better off if most of the humanities departments were downsized and/or shut down entirely. Mr Minto himself is proof positive of the waste...

libertyscott said...

anonymous, the question is whether the private sector would sponsor more scholarships to do that if company tax was, for example, 15% instead of 30% and there was no expectation of the taxpayer paying 75% of course costs. The preference may be to import labour to some degree, but having locally raised graduates is worth something.

Anonymous said...

Sorry - I thought the question was "do you agree with Minto's suggestion that the state pay all students a living allowance". But my answer would be the same - only more so if you're looking for the private sector to pick up the tab! Doctors, scientists, and engineers - yes. Social science, political science, and gender studies - no. Honestly, the idea that all should go to university has done more harm than good. A lot of students are just not up to it and end up taking 'soft' subjects where parroting politically correct platitudes is all that is required to pass. Three years (or more) of Marxist indoctrination turn a lot of them into feeble minded malcontents who think they know it all (like Minto)- when they could have been well paid (and tax paying) tradesmen...

john-ston said...

Liberty Scott, why do you have the level of confidence that the private sector would suddenly offer scholarships with lower corporate tax rates and non subsidised course costs? In the 19th Century when the private sector had the option to do that, they failed quite miserably (there were only a few exceptions where there was philantropy) - private charity was only successful in a minority of cases and in the end, even you have to admit, it took the intervention of the state to finally eliminate the horrors of 19th Century society.

So, if the private sector did not sponsor more scholarships, then what would you do? Assuming that New Zealand went it alone, we wouldn't have as many graduates as we have now and we would drop in the world scale. As far as I can see it, if you wanted to apply a libertarian model, you would need to apply it on a global scale - with one nation, especially one as small as ours, a "pure libertarian" model would just ruin us; people would simply migrate out of New Zealand to other countries that still offered the freebies.