Wednesday, July 04, 2012

Don't buy stolen assets

Last week the government passed its privatisation law, allowing it to sell parts of Mighty River Power, Genesis, meridian, Solid Energy and Air New Zealand to their rich cronies. So what should opponents of asset sales do about it? Dominion-Post journalist Vernon Small uses his Stuff blog to argue that we should buy the shares to keep them in Kiwi hands.

IMHO, this is a bad idea. Firstly, there's the moral argument: privatised assets are stolen assets. Buying them is no different from buying a "second-hand" laptop from a dodgy person at a pub. Its receiving stolen goods. Because these goods were stolen from us by the government, its not a crime - but its not moral either.

But secondly, even Small admits his plan won't work:

Of course it won't happen, because some shares - maybe as many as 20-30 per cent of those on offer - will be set aside for foreign institutional investors.
Meanwhile, interest from those extraordinary kiwis rich enough to buy shares will be taken as a sign of success by the government. So by buying in, you'll be helping National's PR (not to mention being the greater fool our stockmarket insiders rely on).

Instead of buying in, opponents of asset sales should boycott stolen assets (both on he stock market, and in the real one: if you are a customer of Mighty River Power, switch). And they should support calls for those assets to be forcibly renationalised at less than the sale price. Asset-thieves should not be allowed to profit from their crime.