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The 2017 “Stars in their Eyes” talent show at the Community hall. Who will forget it? The pre-show favourites were Bill, Paula and Steve, “and tonight Mathew we are going to be the Hues Corporation with: ‘Rock the boat, don’t rock the boat baby.'” A very solid, if uninspiring performance.
Then next onstage came ‘the moment’. Grant and Jacinda stage-whispered the immortal words from Titanic to each other of “where to Miss?” “to the stars” before launching into their tear-inducing rendition of theme song “My heart will go on”. So patiently rehearsed, secretly over months and so movingly presented on the night that an unexpectedly large number of swinging voters, swung, making it a very close contest.
Finally came the drama of Winston’s solo effort of Englebert Humperdinck’s “After the loving” and many of the old dears who had always liked nice Mr English were now swaying their i-phone torches and swinging their knickers and that performance gave Winnie enough votes to allow Rose and Jack to take the “Stars in their eyes” title.
It was an ominous choice of song that Jacinda and Grant chose as it turns out. We forgot that movie ended with an iceberg and a lot of people were made quickly boatless and floating in the freezing Atlantic.
The Clark/ Cullen team had always steered clear of that iceberg; the Key/ English team didn’t even allow it on their radar; even Andrew Little saw it in time to make an emergency turn and avoid collision. But now the Ardern/ Robertson team, with the grinning masks firmly in place, are steering straight back towards it. Capital gains/ inheritance tax. The hidden iceberg that would sink the ‘New Zealand that we know’ as surely as the unsinkable Titanic.
What is the difference between us and one of the many poverty-stricken 3rd world countries in Africa, South America, Asia or even increasingly in Europe? Answer: It is a dominant middle class. The middle class is the ballast that keeps a country stable.
China has only emerged recently from the 3rd world status, when they only had a labour class and a political elite as their social structure, to the second biggest economy in the world with a political strategy to create the biggest middle class in the world.
But the growth of China’s middle class has been at the cost of middle classes in the west, including New Zealand. Lured by the temptations of retail warehouses full of cheap, disposable consumer goods, we have sold our middle class soul to indulge ourselves.
Only a generation ago Dunedin used to make things, lots of things. We had Sew Hoys clothing factories; Ellis’ mattress and bedding factory; Zephyr heater factory; McLeods soap factory, Hudsons biscuit factory, Mosgiel wool and yarn mills, Methven taps and plumbing equipment factory, McSkimmings brick factory and even Hillside trains workshop. And we had large head office infrastructures to support these factories. We were far less dependent on the outside world back then; and we had plenty of goods to trade for those that we needed to buy in. Now we don’t. Plain and simple. And that story is not unique to us, it is repeated in every town and city around the country.
That time is gone. We now gorge ourselves on Chinese-made consumer goods and more and more of us are using credit cards to do it. More and more have no earned income, that is income that has created an asset on the other side of the balance sheet. The socio-economic gap is widening; the middle class is shrinking. The middle class is progressively joining the social welfare queue and the pressure on social welfare taxes is forcing more and more off the bottom rung and onto the street. That is evidence we can’t deny.
Jacinda and Grant’s solution is to collect more taxes to pay more social welfare and provide more social services and so a Tax Committee is established to achieve that. That report recommends a Capital Gains and Inheritance tax of 33% be introduced. But history teaches us well that tax webs catch the butterflies and bumblebees but are no more than a minor nuisance to the magpies and hawks. Living outside the legal system or moving wealth into offshore tax havens are the options that the criminals and the wealthy take. The tax webs catch the law-abiding middle classes. And so the economic gap widens ever more. Venezuela here we come.
Venezuela was once the wealthiest country in South America based on its oil industry.
Chavez was a caring, smiling man who spent much of the income from the boom years on social services; he did not invest in maintenance and development of his oil industry infrastructure and in diversifying their economy. So a few decades on, a run-down oil industry infrastructure in combination with a downturn in global oil prices meant his country’s income stream collapsed. When Maduro took over the presidency in 2013 the Venezuelan people were in a deep economic crisis with more and more depending on social welfare. And he responded the only way he could with a collapsing economy; he borrowed to meet increasing social spending, with China being the largest creditor having loaned over $US60 billion over the past decade, according to the Centre for Strategic and International Studies in Washington. Today 90% of Venezuelans are living in poverty; the economy had 80,000% percent hyper inflation in 2018 and there is no way out. Food is at a premium, electricity supply is unreliable, homelessness a norm and people cannot get even the most basic medical help. Nearly three million have left the country as refugees. And it can only get worse. Any bailout will take over ownership of their oil reserves and they will be a slave nation.
It can happen quickly even to wealthy countries and happens under the most well-meaning, but commercially naive, political leaders in charge. Those with smiles on their faces and stardust in their eyes.
New Zealand still has a middle class, but with the massive undermining of our manufacturing industries, the new middle class will inherit that status from the investments made by the baby boomers during years of full employment. When we had workers, supervisors and managers in a huge range of manufacturing and service businesses. If Jacinda and Grant bring in a Capital Gains and Inheritance tax, that middle class will be decimated in this generation. Family income generating assets will be sold off to meet social welfare demands and down the rabbit hole we go. Within two generations the middle class, the ballast of the nation, will be all but gone. There will be a huge welfare state class and the 1% super rich. Unchartered waters for New Zealand but look around the globe at other countries’ experiences and you see massive poverty, massive civil unrest. No doubt Jacinda and Grant will have hoped to be based in New York by then on some UN gig. Auntie Helen mentored them both into their roles in politics, Auntie Helen knows people at the UN.
There may well be a theoretical rationale for CG&I tax, but any such debate is dependent on timing and circumstances. When a couple or single parent is struggling week to week just to pay the rent, food, electricity and transport costs for the family, there is not point telling them they need to put aside 30% of their income for their retirement in 30 years. Likewise when we have a generation that is already in debt, due to declining infrastructure and inflationary property costs, and is dependent on inheriting capital assets to just maintain the lifestyle of the previous generation, then it is counter productive to talk about 33% of the current market value of those assets being handed over to the state for disbursement to the low/ zero income earners. That just creates a progressively bigger pool of low / zero income earners and a progressively smaller pool of capital investments from which to generate future social welfare and services. The rich get richer, buying up those middle class assets, and the middle class becomes poor. At that point Jacinda has to go to the international loan sharks and, as Venezuela has discovered, that is the end of life as you knew it.
The old socio-economic systems are heading us straight for an iceberg. Rampant consumerism is driving technological advances far beyond our ability to manage the consequences. It is destroying our middle class, destroying our ecology.
Brave new intelligent solutions need to be found and only brave, intelligent leadership can find them. But a CG&I tax is, as the metaphor states, just moving deck chairs on the Titanic. Back to the movie and what happens when the ballast is compromised:
“She can stay afloat with the first four compartments breached but not five. Not five. She goes down by the head, the water will spill over the bulkheads, from one to the next back and back there’s no stopping it.”
“But this ship can’t sink!”
“I assure you, she can. And she will. It is a mathematical certainty.”
Footnote: While the report said ‘full steam ahead, that is no iceberg it’s a mirage’ Jacinda sniffed the wind and decided if she wanted to go back to the ballroom where she was the belle, she had better steer a by-pass course to starboard. Iceberg averted, mirage or not.
I saw on some facebook page a bit of a self indulgent reminiscence by one of my generation recalling the good old days when we had face-to-face friends not face-book friends; when we built go carts to race downhill against our mates rather than played X Box games against avatars. When someone else took photos of us if the occasion was significant and we kept those photo prints in a private album. There is nothing new in the older generation despairing for the younger generation; that has been going on since at least the time of Socrates, but the difference today is not so much attitudinal as it is technological. Today’s technology has had an influence on the behaviour of youth that Socrates could never imagine in his wildest philosophies.
The facebook post put the timing of this quantum shift in normality at the mid 1980’s. Those of us born before that time had real lives, but the post 80’s generation are now living a fake online life and they seem to be really struggling, emotionally, to adapt their natural human psyche to this self-created virtual world.
Computers in primitive form had been around well before the 1980’s but they were just big, cumbersome calculating machines. I tried, unsuccessfully, to learn to speak to one of these great machines when I did accounting at university in the early 1970’s. The computer then needed its own room, actually it was the size of a small room itself. It spake strange tongues of Portran and Fortran. It told me, numerically speaking, that it was in control of me, not the other way around. If what I put in did not compute, it spat it back out. Start again human.
But it was in the late 1970’s that Steve Wozniak and Steve Jobs started a business to bring these giant computing machines down to size and into our homes. They wanted computers to be fun for all. They named the company Apple. In his biography Steve Jobs said that it was just a serendipitous choice; that he was on a fruitarian diet at the time and had just returned from an apple farm and thought the fresh, fun name suited his company’s vibe. If so, the coincidence is uncanny. The apple has an established historical connection with a quantum leap in mankind’s knowledge of universal law when Isaac Newton said he had his ‘eureka’ moment about gravity when he watched an apple fall from a tree.
The apple also has a prehistorical connection with man’s quest for knowledge and even immortality.
In Norse mythology the goddess Idun was the keeper of the apples of the tree of knowledge and life and is known as the goddess of eternal youth.
In Greek mythology, the goddess Hera, wife of Zeus, ruled the Garden of the Hesperides (nymphs) where there was an orchard in which trees bearing golden apples had the power to heal and renew.
The Hebrew mythology, which is the one most well known in the Judaeo-Christian world, is that Lucifer (the enlightened one) gave Eve, the mother of all mankind, an apple from the tree of knowledge in the garden of Eden. Yahweh was most displeased because mortal man was not ready for such knowledge and so was banished from the lush farmlands of Eden; sent back to the wild to forage like the beasts lest man also eats the apple from the tree of eternal life.
And yet still mankind flourished. According to Genesis 6, the sons of God mated with the daughters of man to create ‘great men’. However the next chapter of genesis describes a cataclysmic forty day flood over all the earth that might well have resulted in our species becoming extinct. Geological and climatic research has now shown us that the biblical and mythical global flood that killed most of humankind, at least in the northern hemisphere, did actually happen 13,000 years ago and the cause was a massive meteor strike on earth, just like the one that had caused the dinosaurs’ extinction 66 million years earlier.
At the time, planet earth was emerging from an ice age; but still the whole of Canada and countries across northern Europe were under an ice cap that would have been about two kilometres thick. And this is where the biggest chunks of the comet hit. The evidence it left behind is in the form of nano diamonds; beds of micro diamonds that were created from a massive explosion creating heat of over 2,200 degrees centigrade. By comparison, fire is 600 degrees C and volcanic molten larva is 700-1200 degrees C. The immediate impact was the instantaneous melting of large parts of the ice cap and an unimaginable tsunami that washed over much of the known world. The meteorological evidence shows that 13,000 years ago, just as earth was emerging naturally from an ice age, it was suddenly plunged back into a big chill referred to as the ‘Younger Dryas.’ This winter lasted 1200 years before the climate recovered again.
Archeological evidence of civilisation pre deluge is understandably a bit thin on the ground. Such a cataclysmic event would not leave much behind. But we do have writings from the middle east region; the authors of the Book of Genesis, the authors of Gilgamesh and those writings of a prophet called Zarathustra. The first two write of an ark in which the selected humans, plants and animals floated above the flood and survived to restart civilisation again. Zarathustra wrote of a prediction that a giant serpent would fly through the sky and that, in readiness for this event, underground, multi level caverns called Vara were built with sophisticated entranceways between the levels and artificial lighting. Such multi-level caverns have recently been excavated in Cabbadicia, southern Turkey. Only the highest quality human, plant and animal species were housed there and they were control- bred to maintain the population levels. When the long winter was over, they were sent out in boats to repopulate the world and to utilise, in secret, the technological knowledge that had been preserved.
But the knowledge that these great men, survivors of the great deluge, possessed must have been quite advanced. The meteor would have done a few circuits around the solar system before zooming in for the kill; so if we, or the gods, had prepared for it then then we must have had sophisticated astronomical knowledge. And as all myths record that there was indeed a plan to save the best of humanity, animal life and plants, so there must have been that astronomical knowledge to allow those plans to be made and executed. Soon human civilisation re-established itself to the level that we now have archeological evidence of sophisticated buildings and civilisations dating back 10,000 years in Gobekli Tepe in southern Turkey. We know of sophisticated cities, such as Babel in Mesopotamia. Babel meant a place where many people gather to talk together. A place of debate and learning. Its modern meaning is voices talking over the top of each other in excited discussion. And it was here, in Babel, that the idea of building a tower with which they would endeavour to reach the heavens was conceived.
Was the tower of Babel a bricks and mortar tower as we assume? Or was it actually a rocket ship, which is also a tower, designed to reach the heavens. Interestingly the discovery of 5,000 year old clay tablets in southern Iraq, ancient Mesopotamia, showed an astronomical map of our solar system that included the outer planets of Uranus and Neptune which were not discovered by the post-flood modern man until the 18th and 19th centuries, after the invention of the telescope. It also shows the two largest dwarf planets of Pluto and Eris. Prior to the re-invention of the telescope only the planets visible to the naked eye were known to ancient sky watchers. As we know, Yahweh ‘confused’ the Babel, scattered the men who conceived it across the lands and the project to reach the heavens apparently never got off the ground.
But after the deluge we redeveloped our knowledge of agriculture, pottery, metallurgy, astronomy and technology. Mankind survived and flourished; the scattered regrouped, their babel no longer confused. And the two Steve’s have brought the Apple computer into our homes. Well they did not immediately arrive into our homes; in the 1970’s and 80’s they were still a geeky, impractical and expensive machine that most homes could happily live without. But while Wozniak was the brains behind the machine itself he would never have taken it beyond the techno geek market and as such would not have survived commercially. His Apple would have withered on the branch. Jobs was most certainly the man (the Satan, the enlightened one) responsible for giving the Apple to mankind. And in a very strategic move, he first took it into the classroom, actually donating the original Apple 1 to some schools just to whet the appetite. He was less interested in wasting the fruits of the Apple on the elders of humankind, he wanted to give it to the children. In 1978 he won a contract to supply 500 Apple II computers to schools in Minnesota. In 1983 he sold a computer package (including floppy disc) to over 9,000 schools in California at a cost per package then for what you would now get a decent I-Mac. The Macintosh (an actual variety of apple) was launched in 1984 and the flood gates started to open. One generation after the Apple from the tree of knowledge was fed to our children, we could no longer imagine education without computers. We could not imagine homes without computers, or people without smartphones.
My little grand daughter is two years old. Her innate demand for language, knowledge and technology led us to the conclusion that we had no option but to give her her own personal connection into the universal consciousness. Her very own Apple i-pad. She took to it like a duck to water. Her knowledge, understanding and communication skills have taken quantum leaps; she swipes through the icons as though she invented them.
So once again an apple from the tree of knowledge is the means by which knowledge and imagination is being spread throughout humanity. It is the means by which we have built our rocket propelled towers with which to explore the heavens. In history Babel was the place where many voices come to speak together. Could the modern day Babels be the headquarters of Google, Apple, NASA and Spacex? Or is 21st century Babel located in the cloud and refers to the inanity of Twitter? The fake lives of Instagram? The pretend friends of Facebook? Interestingly while the Bible’s Genesis tells us that is was man’s corruption and evil that cause the great flood, the pre-dated original Sumerian clay texts said it was the noise and unending chatter of humans that caused the Gods to bring the great flood.
The changes in our lifestyle are, in reality, just as dramatic as noted in the Facebook post that began this blog. The irony being that he used Facebook to express his concerns; he did not call around to voice his concerns to me in person over a cup of coffee.
If Steve Jobs was the 21st century Lucifer then let us hope that humanity is ready for such knowledge this time around and that we are not once again expelled from our Eden to forage like the beasts in the wild for trying to use the Apple to gain eternal life.