But what is the problem?
Over at the Dim Post it is suggested that New Zealand is somehow failing when company owners sell their assets to non-New Zealanders.
However, there is no issue with selling companies in of itself.
The “problem” might be that, as a whole, New Zealand residents appear to own a significant amount relative to their income and wealth.
If we do believe this is the case, then we have to ask why. Just saying “look we are selling stuff”, “look NZ owes some stuff” doesn’t tell us why this is the case, whether this is a problem, and if it is a problem what we can do about it.
If we think that there is some systematic risk from this behaviour, or that New Zealand residents do not recognise the risk associated with this level of risk, then we should be looking for policies that will improve said decision making – not arbitrarily looking at policies that will “force” saving or the voluntary sale of goods, services, or assets.
Is this point of view unreasonable? If we accept this point of view, we also have to accept that other New Zealanders might want to consume now, or may want to avoid the risk associated with “high return” ventures. Given this, it is both unreasonable and harmful to social welfare to try and force New Zealanders to save to effectively subsidise the risk of business owners – which is what compulsory savings will be.
It seems to me that the issue many people have is the low price that the assets were sold for relative to their current profits. That doesn’t necessarily mean it was a bad idea to sell them, but it does make you wonder why they were sold so cheaply. Do NZ owners systematically undervalue their assets due to their natural humility and modest, self deprecating nature? Are NZers incapable of running these businesses as profitably as foreigners because of their generous nature and ethical superiority? Or, perhaps, the problem is that NZ businessmen spend too much of their time giving back to their nation and helping out Kiwi mums and dads, rather than being unscrupulous profiteers.
@rauparaha
All issues we should look into – rather than just conjecturing the way policy makers currently do.
I would also note that Telecoms market cap is currently below what the government sold it for – a fact that has blown my mind!!!