State predatory pricing kills business

and that means private schools.

Cactus Kate points out that if private schools fail because parents can't afford to pay for a private education, then the state sector couldn't handle the numbers.

She's right, but the solution is not to fix the state sector. The solution is to end the unfair competition of state schools, which everyone is forced to pay for, against private schools which get funding only from those using them. State schools are the French farms of the education sector, bloated, inefficient, heavily subsidised, and their output has guaranteed markets because of protectionism.

Parents sending their kids to private school pay twice. The PPTA socialists don't give a damn about that. They are ideologically opposed to competition in education, and opposed to their members ever being accountable for their performance. The PPTA would only be happy if there were monopoly state schools everywhere, centrally managed and perpetual pay increases for teachers above inflation. The PPTA thinks what parents want is not as important, after all the workers always know what's best for the consumer don't they? Lockwood Smith's biggest political mistake was not to confront this bullying labour cartel when he had the chance, and remove decisions on teacher salaries from central bargaining.

So the appropriate solution to save private schools is NOT a "bail out", but something more sophisticated than that. End paying twice for education. It can be done different ways. I'd say just give parents back their education taxes and let them spend it. That's Libertarianz policy. In fact, just letting them opt out of taxpayer funded education would do the job. They could always pay directly for a state school if they change their minds.

However, there are other approaches:
- Parents who choose private education could simply have the proportion of their income tax taken for education refunded;
- A standard amount could be refunded to reflecting the average cost of a state secondary education per student; or
- ACT's policy of allowing funding to follow the student. Private schools then get the same funding as state schools.

Whatever it is, it is crying out for radical reform. The Nats wont want to be seen to be propping up private schools, but having either a tax credit or letting funding follow students would make a positive difference to schools.

After all, education is the sector most desperately in need of reform so that those paying for it actually can exercise the power of consumers, and those wanting to provide it can make their own decisions.

Expect the left to fight it tooth and nail though, after all, without the teaching labour cartels, the Labour Party would lose a key source of funding, membership and candidates, and the Greens, who sometimes fight monopolies, embrace them when Nanny State is in charge.

Obama subsidises home owners

CNN reports that the Obama Administration is going to spend US$75 billion to rescue property speculators whose mortgages are worth more than the value of their homes. Those who didn't enter the property market, or entered it more wisely, are subsidising those who were foolish, who thought the market would ever increase. Those who didn't take out mortgage repayment insurance will be subsidised by those who did.

The Obama administration is rewarding irresponsibility and poor decisionmaking by fleecing the children of those taxpayers. Moreso, he is inflating the property market, making it yet harder for new entrants to it. An administration that ostensibly cares about the cost of housing is pushing prices up for new home owners.

Change who can believe in?

President Obama said that those who would qualify are people the bank are not interested in - which of course, makes it ok to take from the general public to help them out. He said "no sale will return your investment". Well of course not, bad investments SHOULDN'T return you anything. Governments using their fiat money have supported the inflation of the property market as a ghost prosperity allowing people to borrow against their homes, and to encourage speculation for those wanting to make gains. It caused the problem and is unwilling to let the housing market deflate to its rightful level. It is willing to offer even more credit, so presumably people can engage in subsidised bargain hunting.

So Obamaphiles, hope your children are grateful they are paying more in taxes to pay the debt of property speculators. No humour in that is there?

Even more of your money on "infrastructure"

Yep the Nats are going to spend more, following on from last week's US$484 million of "fast tracked" projects, according to Stuff.

It's your money to be used to subsidise these projects, and it basically means money to subsidise the internet, roads (given all fuel tax is already dedicated to other projects), prisons, schools and to insulate state houses.

So what to think of that?

$1.5 billion for broadband. Given that the private sector has so far built three national mobile phone networks without a cent of taxpayers’ money, why should you be forced to pay to subsidise other people’s internet access, just because they don’t live in Wellington or Christchurch (where there are parallel networks). How about removing barriers to investment in telecommunications infrastructure? How about cutting company tax to make returns more lucrative? No – pork for the relatively well heeled. The talk of broadband facilitating business is usually not shared with the fact that broadband is also extensively used for entertainment. THIS is National's new Think Big - and those who rejected the last one are happily cheering this on - without seeing the irony that destroying Telecom's property rights under Labour probably hindered development of new telecommunications infrastructure more than any other recent government measure.

$200-300 million for a new prison? Well at that cost it better be good, especially when you have a 50% range on the price! This is core state business, but I do wonder how much capacity could be saved by addressing victimless crimes.

Waikato expressway? Basically, there are seven segments of the expressway that haven’t been built. Of them, three are definitely worth progressing, the others aren’t.
- Longswamp to Te Kauwhata is partly complete, and isn't a safety or congestion concern.
- Rangiriri bypass is worth building to remove through traffic from that village.
- Huntly bypass is exhorbitantly expensive, over $400 million for a steep hilly highway over Taupiri Hill. Not worth building at present.
- Ngaruawahia bypass is well worth building, as it shortens distance, journey time, improves safety and can link with the improvements at Te Rapa and west of Hamilton.
- Hamilton (east) bypass is over half a billion dollars and hardly worth building at present, when much needs to be spent on the existing Hamilton (west) bypass. Last segment that should be built.
- Tamahere to Cambridge four laning is worth building to improve safety between Cambridge and Hamilton.
- Cambridge bypass is well worth building as a two lane highway with passing lanes for now, to relieve the rather nice town of Cambridge from heavy traffic

Central Tauranga Corridor? Good project, Tauranga has significant congestion on roads ill equipped to perform arterial functions, though again why general taxpayers should pay is beyond me.

More school building? Well let’s pour money into infrastructure for a centrally planned, bureaucratically driven system then. The core problem is simply ignored.

Insulation of state houses? Assuming they are sold, it would be fine, if it would recover more in rent. However, we all know this is a subsidy for those with housing provided by nanny. Market rentals would help, but we know THAT wont happen.

Yes we can!

As US comedians find it hard to parody the new personality cult President, it is unclear exactly why other than sympathy, fear of being called racist or just not being imaginative.

Tim Blair in the Sydney Morning Herald asks why this is the case. However he did also find that the Japanese are laughing at him - though, admittedly, if you know Japanese this will be funnier for more than 30 seconds.





(Hat Tip: Tim Blair)

Aviation security call unnecessary

I'm hardly surprised at the report in the Dominion Post of a recommendation to introduce security screening of all domestic passenger flights. The Police and Aviation Security Service have strong vested interests in expanding any security operation, even regardless of the miniscule risk.

The report says there is a "very low threat from terrorists, moderate risk from acutely disaffected people drunks, those suffering mental disorder or irrational grudges".

Yes seriously, there is a bigger threat from car bombs in built up areas. However, I don't notice security screening of private cars in built up areas. A similar threat for bombing trains and buses, because there is NO screening of who people are before trains and buses are boarded.

The "moderate risk" from acutely disaffected people, drunks, those suffering mental disorder or irrational grudges, is something that might be picked up on check in, and frankly "moderate" is nonsense. According to the report 3.7 events per year happen.

The review is entirely because of the case of Asha Ali Abdille who took knives on a Beech 1900 light and attacked the crew. This sort of risk could be better addressed by having lockable doors on the plane, instead of subjecting hundreds of thousands of travellers every day to a search. Don't forget that all aircraft above 19 seats have at least one member of cabin crew. Better yet, sue this mad woman for the cost she imposed on all of the passengers and the airline.

You see, the sense of perspective about security and terrorism is completely skewed by the narrow minded attitude of those only working in aviation. Has the report analysed the cost in delay, frustration and additional costs for making purchases at destinations for toiletries etc, because of the ridiculous restrictions on hand luggage? What are the costs to business and travellers of this? Those in security care next to nothing about that, remember how they goose stepped everyone into only carrying toiletries in little containers. These are on the same flights that have hot beverages, glass, shoes, belts, rope and any other kind of potential weapon.

To take a clear example - it's remarkable how in the UK iIwas always screened for flying on 50 seat regional flights, but those boarding trains going at 125mph from Euston, Kings Cross or Paddington (or arriving there) faced absolutely nothing. Much like those catching the tube or buses, because they couldn't function with the restrictions. Instead, there is the use of CCTV, the physical presence of security staff and the use of intelligence to monitor security.

Of course you wont 100% ensure there are no incidents. After all, there was security at US domestic airports before 9/11. There could still be incidents, but it is like other human activities. Driving is risky, walking in the street it risky, life is risky. It's about time that the endless call to impose delays, inconvenience and cost upon the 99% of those who fly, in a country with next to no risk of terrorist attack, be resisted. International flights obviously must face security screening, given the profile and realistic danger of terrorism. Domestic jet flights are barely understandable, given the speeds and fuel carried, but provincial flights?

The truth is that you are at far more danger walking around the streets of Whakatane, Wanganui, Kaitaia and Timaru at night, than you are risking boarding a plane at the airports there with someone who will kill you.

The government should demand a full benefit/cost assessment, taking into account the costs imposed on travellers (not the NZ$4.66 but the delay, stress and related costs of not carrying what you need in hand luggage) - and compare it to other risks, and propose other options.