My life is full of non-single use, non-disposable bags...

One of the first things 2017's Labour / Greens / New Zealand First coalition government did was strongly signal its "green credentials".  First cab off the ranks was stopping new offshore drilling oil permits.

The second cab off the ranks was, oddly, single use disposable plastic bags....

Rejoicing in the collective kumbiya of the Green mantra of "Reduce, Reuse and Recycle", and thrusting the Circular Economy philosophy all over the place and into everyone's faces (https://www.mfe.govt.nz/waste/single-use-plastic-shopping-bags-banned-new-zealand) the Government responded to the urgent need to ban the scourge of the environment, the supermarket plastic grocery bag.

It didn't seem to matter that, in themselves, the bags were friendly little useful things. In fact, quite a few of the single use plastic bags I'd shared a brief relationship in the past didn't have a mean bone in their body. Nor did they intend to throttle the snot out of some poor unsuspecting turtle.

Most single use disposable plastic bags only wanted to be useful for getting your groceries home.  Once home, they were more than happy to be used as free freezer bags to wrap the meat up with.

Subsequently, once aforesaid meat was thawed, all the single use disposable bags I'd known (who incidentially had now been reused) were all perfectingly happy to be scrunched down and disposed in an appropriately issued council rubbish bag.

So the big beefy environmental issue wasn't with the bags at all.  These things weren't pure raw evil made of cloroflorocarbons, all bent on environmental destruction and turtle snot-throttling.

The big beefy issue was how people disposed of them...  .. "other people"...

And, to that Prime Minister Jacinda Ardern and Associate Environment Minister Eugenie Sage - responding to the children (https://www.beehive.govt.nz/release/single-use-plastic-bags-be-phased-out) took an axe to the poor old sweet innocent grocery bag.

... and now, I find myself wallowing in a sea of angry non-single use, non-disposable grocery bags that seem to breed at the rate of a Tribble (TheTrouble with Tribbles)

I'm going to have to drive to the tip (in my diesel utu), because I've got too many of them, and they don't compress down easy and fit into my council rubbish bag..

*sigh*

:(

Owning Houses Makes You Richer

Statistics New Zealand just released the change in physical and financial assets component of the National Accounts.  The national accounts (change in assets) explains movements in assets and liabilities from one balance sheet to the next for each of New Zealand’s institutional sectors. The accounts show the accumulation of physical assets (eg houses), financial assets (eg bank deposits), and financial liabilities (eg loans).

Rising property prices between 2013 to 2016 contributed 51 percent of the $364 billion increase household net worth over those 4 years.

https://www.stats.govt.nz/news/rising-property-prices-boost-household-assets

When house ownership is the channel for how 51% of household wealth increased over four years, then house ownership becomes the method for households to increase their wealth. .

From here:  https://rbutler.sdsu.edu/gurely2.htm

Marx insisted that "capital" is not a thing but a definite social relation which belonged to a specific historical formation of society. "The means of production become capital," Marx wrote, "only insofar as they have become separated from the laborer and confront labor as an independent power." Means of production are capital when they have become monopolized by a certain sector of society and used by that class to produce surplus value that is, the income of the capitalist class (generally profits, interest, and rent) that comes from the exploitation of another class. Consequently, capital, for Marx, is not only part of the forces of production but it is also a particular employment of those forces, a social relation.

Its difficult not to see concentrated home ownership, the increase in wealth it creates, and the creation of a structural renting class in Marxian terms.

Nursing Pay Demands Are Bad News for Graduates

New Zealand nurses want more money, or purely and simply, they will strike (http://www.radionz.co.nz/news/national/360103/nurses-want-more-money-or-strike-to-go-ahead).  More money is the only thing that will stop a planned nurses strike from going ahead.  In an economy with 1.1% annual inflation, and annual national wage inflation at 1.8%, the nurses union has rejected a 9% pay increase over a 15 month period.  Pointing to an 11% difference between the top end teacher and nurses salaries, the suggestion is that occupational pay-parity issues is why 9% was  rejected, with 11% being "too low" (http://www.radionz.co.nz/news/national/359810/nurses-strike-action-on-the-cards-over-dhb-dispute).

I did my Masters of Commerce in Economics looking at the role of unions in the health sector labour market, with the results here: www.wiltshirehogan.co.nz.

Cutting to the chase, back in 2014, unions had severely distorted the health sector's labour and output markets, making DHBs unproductive, blocking nursing graduate entry, and extracting higher-than-competitive rewards for their labour.

Because of the health sector unions, DHBs were:

• Employing overall fewer workers than they want to, 
• Paying more for each worker than they should have been, 
• Unable to afford the mix of workers that actually wanted and preferred,
• Were forced to "make do" with the workforce mix they could actually afford,
• Delivering less health services because their affordable workforce mix was wrong,
• Delivering lower quality health services because their affordable workforce mix was wrong.

New Zealand taxpayers coped a double whammy:  they paid more in taxes from the higher labour costs, and they received less and poorer quality health care in return.

Not really "good-o" for Joe New-Zealander...

So, how successful will this round of nursing union demands actually be?  The results from the economic modelling are the suite of own-price and cross-price elasticities derived from my work in Table 1 in my thesis (http://www.wiltshirehogan.co.nz/thesis/Thesis_for_Upload_to_Library.pdf)

Row 5 of Table 1 measures how the quantity of employed nurses relates to the price of nursing and other non-nursing labour prices.  If the price of nursing labour increases 10%, the quantity of employed nurses actually falls 4.9%, everything else being equal (the negatively signed nursing own-price elasticity from row 5, column 4 of Table 1).  If the nurses union is successful at getting a more than 9% pay increase, then they stand to loose about 5% of their employed workforce.

Who Benefits From Nursing Pay Demands?  
First off, the 95% of the remaining workforce who remain employed and receive a 10% pay increase...

But after that, from the Table 1, if the quantity of nurses falls 5% because of their demands, then medical salaries increase 1.5%, allied health workers salaries increase 7.5%, and administrator salaries increase 2.3%.  The demand for these workforces increase and pushes up their salaries, as DHBs substitute away from the overall more expensive nursing labour.

What Would Get Nurses a Better Deal?  
The only workforce change that gets nurses a consistently better off is scale affects - more health services means more nurses employed.  Overall as the health service pot grows bigger, more nurses are needed, and more are employed.

But unions protect the interests of paying members, not those who could be employed...

If it's got tits or wheels...

It's going to cause you pain and cost you money.

What movies I'd like to make

There are some professions that are gritty and glamorous: doctors, lawyers, cops.  Think of all of the tv dramas, and it will involve one of these.  The doctor saves the patient's life, but their own life is terribly conflicted.  Or the cop chases the bad guy, but is borderline criminal themselves.

I'd like to see dramas made over normal people's lives.  Like the retail assistant who delivers exceptional service, but struggles to balance her home life commitments to the time frame of the job. Or the rubbish collector who pumps out house music as he works and then one day before the next Eminem.

I just think we can be more creative and celebrate normal lives.

A Tribute to the Exceptional

Most people lead dull and uninteresting lives:  I'm no different from the majority.  But every so often, when someone exceptional dies, you see what an exceptional life is.  David Bowie died on Monday:  http://www.bbc.com/news/entertainment-arts-35278872, one of the world's true exceptional individuals.  The Master of Change and Reinvention, a musical artist who could express so much emotion so masterfully.  His work shaped a generation.

Steve Jobs, David Bowie, Paul Callaghan... exceptional people.

I'm back! Lets make New Things :)

Well Hello!

Its been a long time, OffWorkEconomist.  I've been busy - its been a busy couple of years.  I'm back now.  And I've got things to say!

2016 will be the strategic year - lets focus on strategic direction issues:  what's happening, where's it going and why or why not should things go there.  Also, lets take a look at creativity.  I'm going to make some creative things, and I'm going to do them in data.  For the last couple of years, I've been making beautiful things in Economics using R.  Now, I'm going to open these ideas and learnings to the masses and the world.

Its a great world out there, and in 2016, I want to add my two cents to it.

I'm back :D

James Hogan