An Excellent Proposal
Every so often we have the pleasure of driving the Rotorua-Taupo road. We always take great pleasure in the scenery--and in particular, the farms lining both sides of the road in parts of the drive.
The only splotches of rain on that particular parade are the knowledge that the farms are owned by the Landcorp, an organ of the State. Like all state owned and directly operated businesses they are inevitably subject to the slings and arrows spitting out of the fads and fashions popular with the government of the day. Not so long ago, when forestry was in the doldrums, large swathes of this state owned land--then a pine forest--had the trees harvested and the land converted to dairying.
These new dairy farms came into production perfectly timed to coincide with a cyclical dairy downturn. This is normal with government owned enterprises: little--yet self-important--bureaucrats making decisions with our money, without the severe discipline of market risk. State farmers are, in the end, cosseted from such things. Consequently, they end up making commercial decisions in a grandiose, cavalier manner. Nine times out of ten they destroy value.
