I have to tell you I'm not a
big reader of Forbes magazine, nor do
I visit their website much. Occasionally I want to check whether Bill Gates is still
the richest man in the world or if not, which Mexican, Indian or Russian
oligarch has temporarily knocked him off his perch. Maybe someone I know has
sneaked into the Top 500 and I can seek to renew an old friendship. Apart from
that, I guess my income has never really put me in the bracket for readership
or invitations to join the club.
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| Two NZ poets with a message for the world - Glover and Tuwhare |
My recent visit was the
result of following a link from a New Zealand news site I use to keep up
with what's going on down there in the land of my fathers - and also, I
confess, because I had been stung by a barb from a friend who suggested I
needed to broaden the scope of my reading.
The news item was summarising
an analysis of the New Zealand economy by a bright young man calling himself Jesse Colombo (his real name?). The
essence of his argument is that NZ's economy has all the hallmarks of a bubble
and is likely to burst before too much longer. Commentators in the Land of the
Long White Cloud have been quick to make light of Mr Colombo's assessment, but
interestingly, they don't seem to disagree with any of his evidence - merely
the conclusions he draws.
I used to take a more serious
interest in economic conditions in NZ, but since I have been living in
Istanbul, my main concern has been the depreciating exchange rate of my Turkish
Liras when I have to travel or send money back downunder. This is indeed one of
Colombo's points: that the Kiwi dollar is overvalued, not only against the TL,
but against all the major world currencies.
Other indicators he discusses
are:
- The financial sector has replaced farming as the largest contributor to the economy;
- Home mortgages represent an uncomfortably high percentage of bank portfolios. Most of these have floating interest rates – fine while rates are low, but Colombo predicts that they will rise, and soon;
- NZ has one of the most over-valued property markets in the world;
- The ratio of household debt to GDP is even worse than the United States;
- Government debt, which fell steadily through the 1990s and early 2000s, has nearly tripled in the last five years.
Well, it’s many years since I
had a mortgage in New Zealand. On the other hand I do try to visit once a year,
and I too have long considered the $NZ absurdly over-valued. Not many years ago
there was parity with the Turkish Lira – now I need nearly 2 TL to buy 1
$Kiwi. And although I love my hometown
Auckland, I cannot understand how an average house there can possibly be worth
the current selling price of $NZ 700,000.
Auckland is not quite the
one-horse, one-street town I remember from my youth. These days the CBD is
making efforts to extend at least a block east and west of Queen St, and on my
last two visits I have strolled up Shortland St (no connection to the
long-running TV soap) to a café in the Vero Centre, a 40-floor tower block its
website informs me is ‘New Zealand's premier business address.’ This
year, with a little time to kill while waiting for the friends I had arranged
to meet, I wandered around the lobby with its ‘distinct South Pacific feel . . . a
showcase of New Zealand art’.
Probably I
should have trod a little more carefully. Centrepiece in the lobby is a 6-7
metre high structure resembling a tyre-less bicycle wheel, the work of one
Andrew Drummond, an exponent, so I’m told, of performance art. Well, the wheel
does indeed perform, rotating slowly on its axis – or at least it did until I
edged alongside it to get a photograph of something on the wall. It was only
later that I noticed a line drawn on the floor and a sign advising visitors not
to step inside the demarcated zone. I felt grateful that I hadn’t set off an
alarm attracting security guards to throw me out into what I understand has
aspirations to become Auckland's version of Wall Street.
What I wanted to photograph
was a quotation among many by well-known local and international personages
covering one of the lobby walls. There it was, in raised brass lettering, Times
New Roman font – the much-quoted
words of Mustafa Kemal Atatürk, founder of modern Turkey, addressed to the
mothers of the young lads from the British Empire who had left their mortal
remains on the killing fields of Gallipoli so many years ago. I was touched, I
can tell you – not merely once again by the magnanimous words of the victorious
commander who harboured no resentment against those who had invaded his
homeland; but that some influential people in my own country have recognized
this significant gesture of goodwill.
On the wall nearby were the
words of John Clarke, aka Fred Dagg, reminding us that ‘We [New Zealanders] don’t
know how lucky we are.’ Some clearly need reminding, particularly those who
were ungratefully throwing eggs and stones at the Prime Minister a few days
ago. Clarke was a local comedian popular in the mid-70s for satirizing NZ
politicians and way-of-life at a time when the country had been cast off by
Mother England and was struggling to find a new place in the real world of
post-oil shock economics. From an earlier and arguably more traumatic time came
lines from one of the country’s most-quoted poets, Denis Glover:
Tom’s hand was strong to the
plough
Elizabeth’s lips were red,
And Quardle oodle
ardle wardle doodle
The magpies said.
The refrain is much loved by
schoolteachers of English literature as encapsulating a fine example of
onomatopoeia. You’d have to say, though, that, by accident or design, the
quotation selection panel chose the least significant lines from the poem for
their display. I don’t want to read too much into the fact that Vero Insurance
is owned by the Suncorp
Group, ‘one of the largest financial and
insurance operations in Australasia’, having swallowed most of New
Zealand’s historical insurance companies.
I will suppress the cynical response
that rose within me when I read, in the lobby near the lifts, a list of the
building’s tenants, at least twenty-one of which are involved in banking,
insurance and finance, and a further nine are law firms.
Wikipedia,
however, tells me Suncorp’s Chairman and CEO are two gentlemen with the
interesting names of Dr Ziggy Switkowski, and Patrick Snowball. I haven’t got
around to checking out Mr Snowball, but Dr Ziggy seems to be a fascinating
character, an unusual combination of businessman and nuclear physicist – having
been awarded the ‘Advance Australia[1] Award’
in 1995 for ‘outstanding achievement in
industry and commerce’.
Prior to his association with
Suncorp, Switkowski had been CEO of Optus and later, Telstra, overseeing the
full privatization of the telecommunications giant. He apparently generated
some controversy in Australia when a Commonwealth Government inquiry, of which
he was the chairman, recommended that Australia increase its exports of uranium
and also work to develop its own nuclear power industry.
In 2011 he also became a
director of Lynas Corporation,
a company involved in the mining, in Western Australia, of what are known in the
trade as ‘rare earths’.
Without getting into too much scientific detail, rare earths are chemical
elements with scary names like Dysprosium, Ytterbium and Thulium that are
essential ingredients in key modern technologies such as colorants for glasses
and enamels, self-cleaning ovens, lasers, PET scan detectors, nuclear batteries
and ultra-powerful permanent magnets.
China has long been the
world’s major producer and exporter of rare earths, but has recently looked to
scale down its operations for economic and environmental reasons. Well, when
China starts having environmental concerns about an industry, it is surely time
for others to take notice. Despite the fact that Lynas mines its rare earths in
Western Australia, it seems they have chosen to set up their processing plant
in Malaysia, citing cost benefits. What that generally means, in
corporate-speak, is that local labour can be employed for wages far below those
acceptable in the home country, in a market where health, safety and
environmental protection conditions are considerably less demanding. Local
politicians in Pahang province and environmental groups have apparently been
protesting against the plant since 2008, and concerns were even raised in an
article in the New
York Times – in spite of which, LAMP (an innocuous-sounding acronym for
the controversial rare earth plant) entered production in 2013.
Denis Glover published his
poem ‘The Magpies’ in 1941, when the
Second World War was helping to pull New Zealand out of the disastrous economic
depression of the 1930s. Glover had a reputation as something of a radical
inclining towards anarchic left-wing political views. Apart from the catchy
avian sound effects, ‘Magpies’ tells
of a young couple, Tom and Elizabeth, who, having worked for years to carve a
farm out of the unforgiving bush, lost everything to the bank that foreclosed
on their mortgage, though was subsequently unable to find another purchaser
willing to take it on. Elizabeth died and Tom went a little ‘light in the head’. . . and the last
word belonged to the magpies, whose
‘quardle oodle ardle wardle doodling’ is probably as fitting a comment on
today’s financial system as it was 70-odd years ago.
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