“Every election is a sort of advance auction sale of stolen goods,” H.L. Mencken wrote in 1936. Never has it been truer than in this campaign.
The parties are outdoing each other with ideas about what to take, from whom, and to whom to give it. Robbing Peter to pay Paul is another way of putting it.
The latest bid came from the Greens. Chlöe Swarbrick wants the government to own 120 supermarkets. Foodstuffs and Woolworths would not be asked if they wanted to sell.
The Commerce Commission would pick the stores, set the compensation and order the sale. Taxpayers would pay $2.8 billion for a chain called KiwiMart. Asked how much cheaper groceries would get, the Greens could not say.
But the Greens are not alone in their disregard for property rights.
Winston Peters wants to buy back the BNZ from its Australian owner. He puts the price at “something above $7.5 billion”, his figure, not the seller’s. Analysts put it closer to $24 billion. Should the owner decline, Peters says, “they always face the prospect of nationalisation.”
These are not ordinary transactions. They are sales under duress, with the buyer setting the price.
Labour would tax gains on investment property, without adjusting for inflation, to pay for three free doctors’ visits a year. A landlord would still owe the tax even if the value of their rental merely kept pace with inflation.
National is at it too. It would extend taxpayer-backed loans with five percent deposits to first-home buyers earning up to $300,000. One group of voters would underwrite another’s house purchases, bidding up prices wherever supply cannot keep up.
None of these policies creates wealth. All they do is redistribute it.
The perverse effect is that wealth creation would become harder.
Who would still build wealth when it is not secure and can be taken away by politicians wishing to win elections? A bank, a supermarket, a rental property: each is somebody’s savings, invested in the belief that the rules would hold.
The pie they are fighting over is too small anyway. An Australian produces in 39 minutes what a New Zealander produces in an hour. Much of the difference comes from capital, the kind someone must feel safe enough to invest here.
What New Zealand needs are not policies to redistribute what we already have but policies to grow the pie.
One way to grow that pie is to stop holding auctions for the slices.