Warning: The following may contain cynicism.

Business confidence is down. What a surprise, methinks — not.

It's always down — at least that is what the sector is always grumbling about.

But this may depend on where you look. The latest reports on the banking industry show that profits, after tax, are up 14.61 per cent at $1.424 billion in the June Quarter. That sounds pretty healthy.


Corporate cowboys Fonterra have taken a hit and dairy farming might be in a bit of a rut but then this actually suits Fonterra.

In the bizarre way that business functions, they make a greater profit from paying farmers less for the milk, thus getting more for their products on foreign markets while gouging New Zealand consumers with prices that subsidise the export price.

We, the ordinary punters, are paying their inflated corporate salaries every time we pay the high prices for a piece of cheese.

Likewise, we are subsidising big business by paying for the infrastructure, the roads, the ports and the electricity grid that allows them to function.

Some of these big companies have complex financial mechanisms to reduce to an absolute minimum the amount of tax they pay, yet expect the government to fund the education system to produce the engineers, designers, accountants and IT whiz-kids they need to be successful.

The actual business end of the market where confidence is really crucial are our small businesses.

These are the ones employing maybe two or three people, who constitute a valuable part of our communities but often struggle to pay their rent while juggling the tasks of keeping afloat, paying their employees and paying their bills.

These people do not have rafts of accountants and clever tax avoidance schemes. They do not have the lobbying power of big business to push government for a bailout when their business goes under.


The contrast can be seen in how big businesses like Air New Zealand and the major banks feel they can ignore smaller centres, charging more for less and hobbling the viability of regional small enterprises that support communities.

The counter argument is that this is market forces at work doing what they do – business 101 – bigger is better.

The flaw in this model is becoming apparent as the giant sheds employing staff on low wages and variable hours demolish the local small businesses.

This gradually impoverishes communities reducing incomes and spending power, pushing the gap between the haves and have nots ever further apart.

Some NZ companies do regard themselves as corporate citizens and understand that the survival rate of small businesses is a sign of a healthy economy.

Government know this but every time there are moves to give a financial injection to small enterprises, big business complains that confidence is down and clamours for assistance.

The contrast between the cries of martyrdom and falling business confidence, and corporate image-making is startling.

The same industry leaders weeping big crocodile tears will be simultaneously talking up their company's success stories to attract potential investors and consumers.

They obviously feel they can have it both ways.

*Terry Sarten (aka Tel) is a writer, musician and social worker. Feedback: tgs@inspire.net.nz