Monthly Archives: May, 2008

Let Them Eat Milk 2

Blimey!

I would like to use slightly stronger 4-letter based words to begin, but who wants to start something like that. I haven’t written in a while and the only things I’ve been thinking about have already been unleashed on the world (see last blog).

I have two very important points to make.

1) DAIRY FARMERS PAYOUT EVEN MORE MASSIVE THAN FIRST PREDICTED.

New Zealand dairy farmers through their monopolistic behemoth Fonterra are going to receive a projected average payout of $800,000 for this year. This compares with about $500,000 last year. Last week the NZ taxpayer finally got a tax cut – $16 per week to come in on October the first. This is the first tax cut in a decade or so. I wouldn’t mind so much, but that is about the cost of a name brand 1kg (2lb) block of cheese. The opposition party had a field-day with this fact on budget day. And can you believe it, the farmers continue to complain. They say we shouldn’t bemoan their huge payouts. They say cost of living is rising for everyone, including them. I suppose this is correct. Tractors do cost money and use up petroleum of some description.

The dairy industry of New Zealand has a lot to answer for (I think if you look back on my last installment I may have said those exact words – who knows…). Because of their massive growth huge numbers of farms are converting to dairy. New Zealand is meant to be a clean and green country. It looks green, but that is thanks to thousands of dairy farmers tapping into the ground water to irrigate land that is usually meant to be brown all summer. Thanks to that ridiculously unsustainable activity the good folk of Canterbury have had to put up with water shortages in recent years despite the fact they live just an hour from a mountain range that sees millions of litres of rain a year and feeds hundreds of rivers across the plains. Unfortunately, hardly any of that water will get to the coast because the dairy farmers need it. When the water runs out I suppose they could irrigate their land with oil.

Which brings me nicely to my second point…

2) OIL PRICES HIT $US130 A BARREL

To be fair, since I typed the above headline it cracked the 140 mark, but who’s counting.

Thanks once again to those ridiculous speculators based in London, Europe and New York who continue to buy up oil like it’s some kind of black gold. I’ve just looked up speculator on the on-line thesaurus and one of the words that it threw back was gambler. Never a truer word spoken Mr. Roget. I heard that pension funds are throwing money the way of the oil. What would a superannuation investment strategist want with a whole bunch of oil? How is millions of barrels of oil going to help me in my retirement when there are no cars left to use it up? When will all those idiot investors realise that if they keep buying up all the oil it will run out??? What will they buy then?

Maybe a bit of water…

Boon x

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Let Them Eat Milk

Are you sick of paying too much for your food? And petrol for that matter… I know my wallet has just about worn itself out trying to keep up with the weekly rises in my grocerial outgoings.

Recently in New Zealand, former state owned telecommunications monopoly Telecom New Zealand was forced, through government re-regulation, to split into three separate companies. This followed years of anti-competitive behaviour on the part of Telecom who, rather than attempting to use their power as the largest company to become an innovative market leader, chose instead to attempt to crush all competition. It adopted a ‘there is no way you can play with my toys in our sandpit’ policy. This has led to New Zealand having one of the shittest internet services in the OECD. Just one third of New Zealand households had broadband access in 2006 – countries like Iceland blow us out of the water with 74% of households with similar access. Obviously these figures are a couple of years old, but at least they’re not as old as Telecom’s antiquated copper-based network. Where the HELL are our fibre optics, or satellites??? Bunch of lazy feckers.

Anyway, my point is that monopolies are bad, m’kay. If you run a monopoly, there is no competitor there to keep you honest. People are trapped into using your services or goods because they have no choice. If your service is shite, people have nowhere else to go. So for years, Telecom has abused it’s position, and now it has to break itself into three. The sad thing about this was the fact it took so long. What stopped the politicians moving against Telecom? I’m just guessing here, but it could be something to do with either, a) Telecom donating thousands of New Zealand dollars to any political party that would take it, or b) The chance for a retired politician to serve on the board of Telecom, or any other company for that matter, is greatly reduced if they vote to split up a company. At the end of the day, when all is said and done, New Zealand was losing out to the likes of Korea in the broadband race.

*Insert link between Telecom and the dairy industry here*

If you live in the western world – which quite a few of my friends and family do – you will be noticing the high cost of living. To buy a trolley of food from a supermarket these days you have to mortgage your car. Prices for bread, milk, butter, cheese, flour, eggs, and many other of our staple dietary thingies have risen from anywhere between 20 and 50% (perhaps even more) in the past year or year and a half. So much for cooking up a batch of cheese scones without shredding your bank balance. There are two sets of people I blame – farmers and market speculators. Let me explain…

New Zealand dairy farmers (who produce the raw materials for our cheese, yoghurt, butter, ice cream and so on) are a monopoly. They have gathered together in a huge milky cartel called Fonterra. This “company” is responsible for selling NZ dairy products on the international market. As such, local New Zealanders have to pay as much for their butter as someone in the United Kingdom or Europe. How can the government let farmers gather themselves together into a massive calcium-based conglomerate when it has forced Telecom to split itself into little bits and pieces (there is that link I was talking about two paragraphs ago…)?

The farmers and Fonterra are blaming the Chinese and Indians for the increased demands in dairy products. Funny isn’t it – as soon as something goes wrong, blame the ethnic minority. In this case, however, the minority is about half the world’s population.

Farmers and Fonterra are also highlighting the ridiculous price of petrolium products at the present moment. I suppose this is another way to push blame away from themselves onto something that they obviously can’t control. You might think that the high petrol price has something to do with Bush and his need to follow in his similarly named father by unsuccessfully trying to win a Gulf War. Good luck there Dubya. I can still remember the day, a mere 6 weeks after the US invaded Iraq and Saddam went to live in a hole in the ground, there was Dubya on an aircraft carrier declaring victory. Nearly 4000 Americans and a trillion Iraqi civilians have died since peace broke out.

Despite Dubya trying his best, oil prices are not currently at record highs (and predicted to crack $US200 by none other than OPEC) because of his military fingering of the Middle Eastern netherparts. The people that buy and sell oil are the ones to blame. They are the ones who are freaking out about what might happen in the future to oil supplies. The speculators are buying up oil faster than it can be produced. The speculators don’t even know what is going to happen, unless they can read the future, or have traveled to the future and are bringing back information in order to profit from it – like Biff did in Back to the Future 2.

Maybe the speculators do know what’s going to happen… There is the argument that we have, or are just about to hit the peak of our possible oil production and that from now on it is downhill. Demand for our fossil friend will outstrip supply and the petrol to power your trip down the the supermarket will cost more than the car you are travelling in. I could be making this up, but I’m not.

There is probably the chance for someone to blame India and China for guzzling all the oil. That’s not fair. If the Western Hemisphere hadn’t set the formula for capitalism to be: Oil + Consumption = $$$$$, then China and India would be powering their current rampant growth with water powered cars. Or horses and carts or bicycles, like they did in the old days.

I thought about this the other day – I would have to go to Scotland to visit my in-laws in a sailing boat. Sweet. No more airplanes waking me up in the middle of the night. No more boy-racers peeling up and down the road. No more smoky imports driving around clogging my lungs with their outpourings. Then we could get on with the process of growing our own food in our backyards and living off the land. The return of the hunter-gatherer.

I’m not sure if the above rant makes any sense, or flows in any way, so let me sum up.

  • Oil will run out.
  • Monopolies are bad.
  • NZ dairy industry is monopoly.
  • Dubya is stupid.
  • Capitalism is greed.
  • China and India make nice food.
  • Bogans suck.
  • Masons run the Police and the bacon industry.

Any questions can be posted as comments to this page, and answers will be given in due course.

Happy trails.

Boon x