The GST hike

The biggest reverse culture shock I'm experiencing (by reverse I mean NZ is obverse side of my little world) is that this country suddenly seems so hopeless. Everything in China, at least in big cities like Beijing and Shanghai is booming, building projects are happening in a lightning speed. China is also a world's second biggest, or biggest? market for luxury goods. My friends there are speeding their money like burning toilet paper, while I'm still counting every cent of my earnings.

Making my feeling worse is the price hike on almost everything. I only left the country for 3 month but everything seemed to have its price increased for several rounds, and I'm hearing the GST is also on the price hike list.

It's very difficult to avoid paying GST, it exists everywhere in people's daily economic life, making it one of the most effective revenue gathering machines for the government. There are many ways to avoid paying too much personal income tax, and tax on specific goods is more likely to decrease demand rather than increase the taxation revenue.

But of course this isn't all about revenue gathering. This is because Mr Key wants to give people tax cut, more specifically, the high income earners. In his speech made to parliament,  Key states that low income earners will be compensated through a upfront increase on benefits and working for families programme, but the trouble is, there's still very little details to see whether the compensation is enough to offset the GST increase.

Another feature of GST is that it treats every one equally, people all pay for the same rate. Statistics New Zealand says GST increase to 15% is likely to affect the CPI by a 2%+ one off increase, theoretically at least. What would really happen after the increase is still subject of a debate. Many New Zealand businesses advertise goods price ends with .99 just to make the price more appealing.  Many businesses will be facing a not so tough choice - whether to absorb the 2.5% increase themselves, or add it to the current price.

Well one of the phrses or excuses businesses just love to use is " we have to make profits".  So my guess is that the actual increase is likely to be more than 2%. Low margin and low price goods are more likely to get a $1.99 to $2.99 type of price hike as businesses are already sturggling making profit on those goods. Statistically, the overall increase would not be that huge, but the fact that troubles me is that low priced goods are more likely to be daily necessities.

I can't really quite understand the ideology behind this tax structuring apart from making high income earners happy. Yes this does give people more choice, as they got more money in hand - whether by more it means another 50cents or $50 in hand, is another problem. However, there are some choices people just don't have the choice, we all need food survive regardless whether you are high or low income earners.  The idea of removing GST on foods and petrol has been floating around for quite some time, but the government seems to have very little interest in it.

Capital gain tax is another thing government isn't very keen on. Speculating on real estate did make a lot of people rich, but that's at the expense of putting even more people at miseray. And most importantly, a healthy economy needs real economic activities,  new money has to be made - in the form of goods or services.  Prosperous property market sounds good, and looks good on GDP, but that's not real economy. It's unsustainable and who knows if he or she isn't the unlucky one or the greatest fool?

Government's very little action on these area does suggest me something they didn't tell. In his election promise John Key said he wants oversea kiwis back to their country and keep the young ones here. However, as a young adult myself,  the outlook of  me to stay in this country looks fainter every day, stuffs this government is doing, or not doing is making a graduate student  more difficult to make a decent living out of average wage.

And ... I'm back.

I was hoped I could be able to update everything while on the go, but as one of the problems of travelling alone is that I have to plan everything myself, there was very little time for me to actually take care of this blog. So my apology for my laziness and not updating this blog for more than 3 month.

In the past three month I have visited a total of 8 Chinese provinces/multiplicities. My original motive for this travel was to see as much as possible of my home country before I suddenly find myself no longer a student. Unlike many kiwis, I don't like to do OEs as travel isn't really on my favourite list.

However, people, have become another important attraction for me. I was warmly welcomed by my friends online, especially those from twitter in every stage of my travel; some even kindly offered me free accommodations. They come from a variety of background: university students, white-collar workers, social activists whom have spent time in Chinese jails and government officers who are living in a very affluent life.

China is a land full of opportunities. The country is like a giant construction site and everything is played in fast-forward motion - I experienced this in Shanghai, literally. I was circling around Shanghai for about 2 weeks, visiting surrounding cities. Two weeks later, when I get back to Shanghai, I nearly got lost as I was troubling to find the very same accommodation I lived two weeks ago - everything around has changed, business were closed for some kind of redevelopment.

However, this incredible speed comes at a hefty price. Every person I have met, regardless of whether they are pro communist party or not, admit that this country cannot continue on this road forever, both socially and economically. Chinese society has become a kind of jungle, where the strongest survive and become affluent in every way, leaving very little physical and social resources for the poor and less fortunate ones.

This itself isn't wrong, however, relative strength of a person isn't decided he or her ability and skills, but money, power, and guanxi. This left the socially and economically disadvantage group very little opportunity to succeed, making the gaps bigger and bigger as time goes by.

Anyway, enough for the political side.  If you have a few thousand NZ$ floating around, China is a good place to go. It offers you pretty much everything you can imagine at a very modest price. My budget was about #3,000. The only problem is time, China is huge - I was only able to experience a slice of China - Panda, Great Wall, Terracotta Army and Shanghai in three month's time, there are a lot of place I want to go but couldn't find enough time and money.

On holiday

Well I didn't update here for quite a while, one was because I was preparing for the exam, which didn't go well at all (as usual), and I was preparing for the trip to China.

I'm planning to stay in the country for about 3 month.For most of the time I'll be staying in my hometown , however, I'm also planning to visit number of Chinese cities including Shanghai and Beijing.

I'll be arriving in Shanghai sometime tomorrow morning (2oth) and visiting  cities like Nanjing and Hangzhou in the surrouding area for two weeks before I get to my hometown, Chengdu. So, anyone who would like to buy me a meal, the time to contact me is now :)

I don't think I'll be able to access the Internet for quite a while, I don't have a laptop, and I heard that the Great Firewall of China is now more capable than any other internet censorship system existed in this world. However, I can assure you that this is not the last post of 2009, if I have time and access  then I may update while on the go.

If anyone wants to find me, just leave a message to my email or here, I'll get back to you as soon as possible, but do expect delays.

See you in China:)

Another free-rider

This time it's Maori Party MP Hone Harawira. He skipped a day of an EU meeing in Brussels but instead go sightseeing in Paris with his wife. When asked about the trip, the MP responded:

"How many times in my lifetime am I going to get to Europe? So I thought, 'F*** it, I'm off. I'm off to Paris"

There's a few issues that Harawira needs to know.

First, on his salary, I would imagine that he could afford a trip to European once a year ... or maybe every three years. Maximum. As long as he knows how to save money, he's pretty much fine.

Secondly, the trip was a taxpayer-funded travel for specific purposes ONLY. As a taxpayer, I asked him to go Brussles to represent the country, not to fund to his private travel. Although he paid for his own trip, however, it was at expense of not doing what he was suppose to do.

Thirdly, this MP really needs to learn how to express his feeling in a polite manner that represents the culture of this country.

You know,  I'm really shocked this time. Are those principles that hard to learn and grasp? I mean, even an elementary school student knows these:  don't steal parents' money, complete the school work before having candies, and don't swear.

What is even shocker, is that after reading the Herald's online forum, I realise there is no shortage of people who are actually arguing for these MPs' inappropriate actions.

This country got some serious thinking to do.

The plan

Why I has been away for such a long time - I had a tough week before finish the semester, and ... I was just too lazy and really have nothing to say here.  Now I'm back, but I still don't expect to update here as usual as before. As you may know, I'm about to travel to China for three months. Mainly to visit relatives and my extend family, but with a little bit of spare time, I'll also be visiting a few cities in eastern part of  China  like Shanghai, Nanjing and Beijing as a tourist.

But before I go, there are still exams I have to do.

So, the plan is I'll be leaving on 20th November. Before I get home I'll be having a stopover in Shanghai for about 2 weeks. During the period I'll be visiting cities around the area, most likely Hangzhou and Nanjing. Schedule for Beijing is still not yet decided, I'm trying to arrange a trip to North Korea, if it is possible to get into Kim's Realm , Beijing would be part of that trip.

There are several other places like Xinjiang and Taiwan on my list but not planned yet. I highly doubt I'll be able to go as my wallet would unlikely to allow me to do so.

I'll be on my own for most of the time in China, so anyone who would like to buy me a lunch or dinner  will be  much appreciated :)

New driving law

Just a reminder that starting from November, driving while using the cellphone by hand is not allowed anymore. That includes texting and talking on the phone.

Base my experience I support this measure. As a still relatively  inexperienced and cautious driver I have never attempted to do either. I don't know how others managed to do two things at the same time, but for me, using cellphone removes my eyes from the road, it's no different than driving blindly. No need to prove how dangerous that is.

However, cellphone really is just part of the problem.  People do and can be distracted by all sorts of things while driving. But most importantly, I usually find that it's where your mind is, rather than where your eyes are that makes the difference. I have found  little evidence shows that such law change can reduce the road toll, but plenty on how bad mood can influence driving performance. Talking over the cellphone, although using the hands-free set, can still take people's mind off the road.

The only solution  that can genuinely reduce the road toll is to ban cellphone use altogether, but no government at its right mind would adapt this measure as it would likely to be very unpopular among voters.