Forum Archive Index - December 2002

[ichi@ihug.co.nz]

tennyson@caverock.net.nz wrote:
> 
> No, the bailing out was not done for Air New Zealands 
> sake. The producers of goods with a short shelf life 
> having painstakingly built up an overseas market over 
> many years, and those high tech manufacturers who rely 
> on air freight of parts for emergency servicing of their 
> overseas installations, and tour operators holding full 
> bookings for their tour buses for the summer season were 
> faced with a considerable, possibly catastrophic, loss 
> of business through the blocking of the air corridoor 
> conduit.  

So what?  It's a tough world out there.  Lots of things
can block your precious air corridor:  industrial action,
bad weather, earthquake, terrorism, whatever.  

> The threat of an almost total strangling of the passenger 
> and freight system 

It's unlikely that the planes would be grounded for long.
The receiver would no doubt keep them flying and/or
competitors would move in to fill the gap.

> through absolutely no fault of their own is not something 
> that can be reasonably planned for by these totally 
> innocent business people.

Yeah it's tough for them, but they are adults.  If they want 
the freedom to make profits without government interference, 
then they should be ready to face the downside without 
government interference.  

> *It was right IMHO, for the government to step in to help 
> these totally innocent parties that are the engine of growth 
> for the New Zealand economy.*

There's that "totally innocent" again.  In some quarters
businessmen are considered blood-sucking exploiters.  :-)

> Furthermore ichi, you seem to imply that Air New Zealand 
> were somehow 'winners' with the bail out.  

Nope.  That assumption is all yours.  Nothing to do with me.
 
> Despite the 'bail out', shareholders who have held on all 
> the way through the Ansett purchase have lost around 75% 
> of their investment.

At least they have 25%.  It's better than nothing.

>  The government has not recompensed them for this.

Wow, another novel idea.  The government compensating 
investors for losses on the share market.  I'd like some 
of that (I've still got some worthless Chase shares).  
Still, if the government's got money to soothe the 
unhappiness of Maori,  perhaps they've got enough for 
us unhappy investors.  

> On the basis that an airline headquartered here in New 
> Zealand would best serve the interests of New Zealanders.

How exactly?  Before the arrival of Ansett, our domestic
airline (headquartered in New Zealand) charged high fares
and provided poor service.  Did that really "best serve the
interests of New Zealanders"?

> Why should an entity controlled by the Singaporean 
> government (Singapore Airlines) make any extra effort 
> to promote New Zealand?  

Because it is profitable.  Bums on seats.  Isn't that 
what a kiwi-controlled airline would do?  Or are you
suggesting that Air NZ act like the Department of
Tourism and Publicity?

> Would you expect 'your' government to look after 'your' 
> 'home market' first, or favour advancing the interests 
> of foreign nationals in other countries instead?

I would expect my goverment to get out of the way and 
let businesses get on with it.  

> The best option would have been not to buy Ansett, at 
> least the last 50% of it, at all.  

A good option, but not necessarily the best.  Full
deregulation may have been the best option.

> But with hindsight that is an easy thing to say.

It isn't hindsight.  At the time of the deal, lots of
people (including myself) were dead set against the deal.
 
> Given that the NZ government decided they wanted an 
> NZ controlled Airline, 

Just like they decided to kill sustainable forestry on 
the West Coast, just like they decided to re-nationalize 
ACC, just like they decided to emasculate the airforce, 
just like they decided to push through the NCEA, just
like they decided to "close the gaps" (by transfering
money from the productive to the unproductive), etc., 
etc., etc.

> a cash investment by the NZ government was the only 
> way to go, once the crisis point had been reached.  

The only reason we reached crisis point was because of
government interference and dithering.  This was a
government-induced crisis of "Think Big" proportions.
Afterall, the only reason Muldoon had to introduce the 
wage/price freeze was because of his own ham-fisted
interventions.

> I didn't see your hand going up volunteering to put 
> $NZ1bn in yourself 

Of course not.  That would have been a big mistake.
Good money after bad, and all that sort of thing.
It's a pity the NZ government got sucked in.


----------------------------------------------------------------------------
To remove yourself from this list, please use the form at
http://www.sharechat.co.nz/chat/forum/