Larry Williams: Politicians shouldn't meddle in dairy affairs

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Listen to Larry Williams on Newstalk ZB, 4pm to 7pm. Today he looks at warnings for dairy farmers and the three-strikes law.
Image / iStock
Image / iStock

Prime Minister John Key says that around 10 per cent of dairy farmers could be forced off their land. I think Key's numbers are on the low side.

If the milk payout forecast remains at $3.90, and this looks decidedly possible for some years, and with DairyNZ analysis showing the average farmer needed a milk price of $5.40 to break even, it's easy to see many more than 10 per cent of farmers "going to the wall". In the UK they're predicting one in five farmers will walk off the land.

Dairy farmers hold $40 billion of debt, and sooner or later, if they default on that debt, the banks will move. The Reserve Bank put potential farm failures at 44 per cent as a worst-case scenario. The potential for many foreclosures then is dire.

Ride to the rescue Labour leader Andrew Little. He has called for the banks to be "stiff armed" into not forcing dairy farmers off their land because he's worried that farms will fall into overseas ownership. Yes, Little is back onto his anti-foreign ownership twaddle. As for "stiff arming" the banks - I have no idea what Little plans, but dairy farmers loading themselves up with debt wasn't mandatory.

They weren't forced to take big loans out.

I see Little also wants a summit to tell dairy farmers what products it should be selling overseas. He wants to move Fonterra's products up the value chain. I don't necessarily disagree with the dairy industry moving away from bulk milk powder to value added, but there is someone called a customer, and right now Fonterra's biggest customer, China, wants milk powder.

The last thing Fonterra needs is meddling politicians in their business affairs.

Three strikes law

Crown Law is appealing two cases where judges have refused to send killers to life in prison under the three-strikes law.

They are also considering appealing two recent cases where judges have used the "manifestly unjust" clause in the three-strikes law to avoid sending killers to life in jail. Life meaning life.

The law states if a murder is committed on a second or third strike, the sentence is automatically life without parole, unless it is "manifestly unjust".

Judges will not impose what they see as a harsh sentence - not one judge has done so. They're actually finding reasons to establish the "manifestly unjust" excuse.

The intent of Parliament was clearly to send the very worst criminals to jail for life and clearly judges are not interpreting the law that way.

Now you can argue the pros and cons of the three-strikes law, but it is what it is, and judges are ignoring the intent of the law deliberately.

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