“Tauranga City may put itself in an untenable position if it tries to raise capital by selling bonds to the public,” warns Katherine Ransom, candidate for Democrats for Social Credit (DSC). “Individual investors could well feel that they have a right to make demands or block council projects, and what happens if bonds are purchased by a large corporation? I see naming rights looming.”
Instead of just ‘Coca Cola Libraries’ as was proposed a while ago, Ms. Ransom predicts a re-naming of the city, or even the entire region if the bond sales go ahead.
“The City Council may intend to cash in on the ‘huge fears’ of wealthy investors, but in doing so councillors themselves have every reason to be afraid. ‘Coca Cola Tauranga’ ought to send cold shivers down the collective spine,” she says.
“There should be another way to access finance, without borrowing scarce and expensive credit from commercial sources, or selling Tauranga to a multinational. We still have a publicly owned sovereign bank, the Reserve Bank of New Zealand.
“Instead of shoring up an unjust and unstable financial system by guaranteeing commercial bank deposits, our sovereign bank should be lending capital at nil interest to local bodies. Projects would be paid for only once, allowing the city to flourish without the burden of compounding debt.”
Ms. Ransom regards the notion of ‘inter-generational equity’ as a confidence trick invented by finance companies. “You wouldn’t deliberately bequeath massive debt to your own children - why should we allow such an injustice at local body level? The only winners in ‘inter-generational equity’ are lending institutions raking in the compounding interest.”
The public sale of city bonds Ms. Ransom sees as little better. “Individual investment in the city might be a good thing, if the minimum was within reach of small investors. A widespread public ownership of Tauranga could contribute to civic pride and community spirit.
“But at a $10,000 minimum, only the wealthy need apply, disenfranchising those on middle and lower incomes still further.
“Selling city bonds is selling the city into bondage.”