- Hon David Cunliffe, Labour Economic Development and Associate Finance Spokesperson, Clean-tech Cluster Chair
Published 30 September 2012
Scandinavian Economic Development Speech: Fast Forward – Growing Good Jobs
Speech to Laingholm District Citizens Association, Laingholm, 30 September 2012
Robert Louis Stevenson, the man who wrote ‘Treasure Island’, once said: “Everybody lives by selling something”.
In these days of economic treachery, this sounds like a very negative statement.
Everybody lives, today, by selling something.
But actually, the phrase: ‘Everybody lives by selling something’ is merely stating a simple truth.
In order to survive I must breathe air.
In order for me to breathe air, there need to be green plants producing oxygen.
So, when I breathe in, I’m breathing in air that was mostly made in the green plants.
But this is not a one-sided trade. I don’t just breath in air, I breathe out carbon dioxide, which is in return breathed in by the green plants, and converted back into oxygen, for me to breathe once more.
The green plants and I need each other. We trade what we produce, and both sides survive and prosper as a result of our necessary partnership.
Ecologists call this process of mutually-beneficial trading ‘symbiosis’.
WINNERS AND LOSERS
Motivational speakers have a simpler term: they call this process ‘win-win’. There’s no winner and loser when I trade my carbon dioxide to the green plants and get oxygen in return. I need the oxygen; the plants need my carbon dioxide in order to convert sunlight into food.
Provided both sides play fair, this is truly a win-win situation.
The problem is, too often over the last 30 years, and some would say for much longer, the world’s economic system has not been win-win for the average person, indeed for most of us. It’s been win-lose: they win and you lose.
The rich speculators and traders get richer, while the rest of us get poorer. Like it or not, our country is going backwards.
What happened? This widening gap isn’t the Kiwi way. What’s changed over the last thirty years?
Let’s have a quick recap of history. As a result of the Great Depression of the 1930s, the New Zealand Labour Party – like its counterparts around the world – legislated to rein in speculation, to protect jobs and to protect human rights.
Most of New Zealand’s great economic assets, such as our farms, our roads and our forests, grew and prospered as a direct result of these policies. As our nation grew more prosperous, the wealth was widely shared. No children needed to starve in the New Zealand I grew up in.
However, the 1980s and ’90s saw the rise of a philosophy developed by the rich, for the rich. It was called Neo-Liberalism.
Neo-Liberalism is based on the idea that it’s a dog-eat-dog world. Neo-Liberalism is based on the idea that greed is good, that we’re all locked in an economic life-and-death-struggle with each other. Neo-Liberalism says that compassion is for suckers. Neo-Liberalism says that if the world is going to the dogs, it might as well be the top dogs. Indeed, to borrow from Oliver Stone’s Wall Street, not only is greed good, “it’s legal.”[i]
When the British Conservative prime minister Margaret Thatcher was asked about the effects that her Neo-liberal policies would have on society, she replied:
“There is no such thing as society… There are individual men and women.”[ii]
The amazing thing about the Neo-Liberals is their wilful blindness to how badly their ideas have failed. Not just once, but repeatedly. Neo-Liberal policies directly caused two of the largest financial crashes in history. Did they apologise? No way. Like some mad doctor, when the first dose of medicine didn’t work, they wanted to double the dose.
And so, the Neo-Liberal bandwagon rolls on. Right here in New Zealand, the National Party is still trotting out the same discredited economic policies that got us into this mess in the first place.
I have just returned from Denmark and Finland, and I am convinced there are lessons for us all in how these Scandinavian countries run their economies. In particular, we need to take note of why the Scandinavian countries are slowly winning while many other European countries are rapidly losing.
Let’s take a quick look at the ‘Scandinavian model.’
The ‘Scandinavian model’ isn’t really Scandinavian at all. It could also be called the traditional New Zealand model. A model based on the idea that the economy is like a farm or garden. If you want a garden to grow, then you have to dig the soil and plant the seeds. You have to feed and nurture the plants and you have deal to the weeds when they grow up amongst the crop.
If this sounds like simple common sense: it is.
Any farmer will tell you that you get back from a farm what you put in. If you let weeds grow, you get a farm full of weeds. If you nurture your soil, livestock and crops, you have a good chance of a healthy farm, and a healthy return on your investment.
Which countries are currently surviving the recession best? The ones with the Scandinavian economic model.
According to Neo-Liberal economic theory, the Scandinavian countries should have collapsed by now. After all, they have large numbers of public employees on decent wages. Large trade unions. Very high taxation. A huge amount of government spending. I’m not arguing for a carbon-copy, but it has worked for them.
While the Neo-Liberals in America, Britain and New Zealand have been targeting those on welfare, blaming them for the world’s problems, the Scandinavian countries have been doing the opposite. That is, they’ve been helping those on welfare to get jobs, not blaming them for being poor.
After taking a big hit from the global financial crisis in 2009, the Scandinavian economies have bounced back strongly, while most of the rest of Europe seems stuck in reverse.
What’s the Scandinavian secret? The Scandinavian people have mastered the art of win-win.
For example, on my recent visit, I saw the Danish approach to economic development.
Denmark doesn’t tell its businesspeople what to do. Instead, Denmark sees its businesspeople as partners. The Danish government sits down with its key business groups. The two sides plan a workable strategy. After listening to its voters, workers and business partners, the Danish government doesn’t muck around. Incentives, sector plans, skills training, research and development, industry investment, targets and timetables are all actively used to get the economy moving and to keep it moving.
There is real symbiosis; it’s a win-win partnership, and the whole country benefits.
No surprise then, that Finland and Sweden came third and fourth respectively in the latest World Economic Forum competitiveness survey.[iii]
This competitiveness is driven by a government that understands how to invest in its people. According to the World Economic Forum, the key to the Scandinavians’ success is largely the result of a high level investment by the government and industry in education and training.[iv] The Scandinavians understand that ignorance is poison.
The Scandinavians know they cannot compete with China for low labour costs. They don’t bother to try. Instead, the Scandinavians have learned the value of working smarter instead of merely working harder.
Scandinavian bosses and workers don’t see each other as natural enemies. They may not always get along and they may not always agree, but they understand clearly that bosses and workers need each other.
I wish our government understood this.
GROWING JOBS, NOT WEEDS
So what would a good farmer do to grow the farm called New Zealand? What practical tools and lessons can we take from the small, smart countries of Scandinavia?
A good farmer ploughs the soil to create the conditions for healthy growth.
Getting the economic basics right is important.
The first economic basic that we need to get right is trust. Whether it’s with respect to John Banks skirting around the truth or John Key burying his head in the sand over the Dotcom saga, New Zealand’s reputation as an honest country in which to do business is under serious threat.
We have to restore trust, both in New Zealand and overseas. Investors won’t come to New Zealand if they think we’re a banana republic.
And make no mistake about it: Labour welcomes investors to New Zealand. However, we welcome investors who come as partners, not masters. Our country is not for sale. New Zealanders do not wish to become tenants in their own country.
We also need to stabilise our currency, so that businesses have some certainty. We need to keep the New Zealand dollar from continually rising, because if the dollar is too high then our exported goods become too expensive. Other countries do this – so should we. The high New Zealand dollar is making life hard for exporters and it’s simply ruining manufacturing in New Zealand.
As my colleague David Parker has said recently, targeting inflation alone is an old orthodoxy that few countries support[v]. We need more balanced objectives, and a broader range of tools to achieve them.
We also need to stop the housing market from spinning out of control. Not only do high housing prices make homes unaffordable for many ordinary families, but housing booms are usually followed by housing busts. We’ve had quite enough economic train wrecks in recent years, thanks very much.
But economic and financial stability is about more than just keeping prices stable.
Watering the soil
Good farmers don’t just dig the soil, they keep it watered.
The lifeblood of business is capital, but many private investors have taken flight since the crash of 2008. A business community without investment is like a field without irrigation: without some water, the crops will wither and die.
I’m not advocating the government dolling out taxpayer funds to big business. There’s been too much of that already. Taxpayers are sick of it. I’m sick of it.
However, there’s no reason that the government can’t help those who are helping themselves.
For example, suppose a private company needs to do some expensive research and development, and this research and development benefits the whole country.
As another example, suppose a private company is researching a cure for Kiwifruit disease? Labour’s research and development tax credits would help that company find a solution.
Accelerated tax depreciation for short-life technology, and other measures soon to be announced, would also assist the innovation process.
Those kinds of policies could be part of a broader win-win approach. That’s how things work in the Scandinavian countries. That’s how the Scandinavians gets results.
Investment also comes from savings. For those who don’t know it, New Zealanders in recent times has had some of the lowest levels of savings in the developed world.[vi] This is wrong for two reasons: one, without savings, our citizens have no fall-back position if something goes wrong. Two, because when people save these savings can be invested wisely.
That’s why Labour’s universal KiwiSaver plan lifted our savings rate four times faster than National’s alternative. Under Labour’s policy, New Zealand would have more capital available for local investment, rather than relying so heavily on foreign-owned banks.
That’s a lesson the Scandinavians have learned and that our Aussie mates have also got right. We need to get it right as well.
Another area in which Labour is streets ahead of National is in the area of capital gains tax. Let me explain this very briefly: many New Zealand businesses have given up investing in useful and productive areas. Why? Because the New Zealand tax system encourages business to invest in the wrong places. That’s because many of the richest New Zealanders have grown rich from capital gains. They buy a piece of land for a million and sell it for three million. That’s a cool two million dollar profit, much of it tax-free. Regardless of how they earn their income, everyone should pay the same rate of tax.
Investing in property for capital gains not only makes home buying unaffordable for many families, it sucks billions away from productive investments.[vii]
Worse still, history has shown that what goes up generally comes down, and often with a crash.
What a capital gains tax does is encourage all investors to put their money into areas that produce something. This will have the effect of dampening the current property bubble, while freeing up billions for investment in areas like computer technology or energy production.
This is not some freak theory; it’s acknowledged internationally. That’s why there are only two other developed countries that don’t have a capital gains tax.
Pro-growth tax reform, including a capital gains tax and the restoration of tax credits for research and development, is needed to water the soils: feeding real Kiwi businesses and creating real Kiwi jobs.
Planting the seeds
Good farmers carefully sow and nurture the seeds and tend the crops as they grow to maturity.
The seeds of our economy are the innovation and ideas that can be raised in our universities, businesses, garages and garden sheds.
Kiwis are an innovative, creative people. Our capacity for working wonders with reduced resources has led us to developing the world’s first electric fences, jet boats and so on. The list is almost endless and the ideas are often brilliant. But too often, unless the inventor has deep pockets, too many good ideas don’t get off the shelf. Once the seed capital from ‘friends, fools and family’ runs out, often, so does the business. The sad fact is that – even during the economic good times, four out of five Kiwi business start-ups withered and died in the first two years.
In Japan and Korea, four out of five new businesses survive past two years[viii]. The difference is that in Japan and Korea, there is comprehensive government support for small business development. Support with budgeting. Support with obtaining investment. Support with business plans. Support with taking successful products and showing them to the world.
Last week, the New Zealand Herald told the sad story of how 32 of New Zealand’s biggest high-tech companies have been sold off overseas at an early stage[ix]. That’s like ripping out a crop when it’s half-grown. It’s madness.
Labour welcomes positive investment, but we want to avoid the best and brightest of our young companies being continually hollowed-out from Kiwi ownership.
We need policies that will help young Kiwi companies grow for longer, and become stronger, right here in New Zealand. We know the main problems: a lack of capital to support growth, a lack of experience in trading outside of New Zealand, difficulty communicating with overseas customers and a difficulty delivering the product or service around the world. David Shearer, who is also our Innovation Spokesperson, will be speaking more on our ideas in this area shortly.
Labour also believes that government should try to buy Kiwi-made products where possible and appropriate, and ensure that Kiwi companies have a fair chance to sell to their own government. Taking a hard look at government procurement is also a part of Labour’s policy mix.
The government should also have a strong policy of avoiding products that cause significant environmental harm and those that rely on the cynical exploitation of workers, especially women and children.
Rebuilding manufacturing, sectors and regions
Good farmers have a plan for every paddock on the farm. We need a sustainable growth strategy for every industry sector and region.
Sadly, however, since National took over many regions have slipped backwards, and this is no accident. The East Coast and Northland have skyrocketing youth unemployment. Wasting a generation of young Kiwis in our regions is not good enough. Take forestry for example. We don’t build enough quality products with our own wood. Instead we cut down the trees and ship the logs to ‘sweatshops’ overseas. Under the current New Zealand government policy, there’s simply no incentive to do otherwise.
A similar thing happens in dairy. Our milk is mainly shipped overseas as commodity products like milk powder, while too often those that develop these ingredients into branded products get most of the benefit.
It’s even worse with our seafood. Did you know that for the next four years it is legal for New Zealand companies to catch fish in our waters using Korean boats manned by Filipino sailors who are treated like slaves?[x] This fish, in some cases, is then sent to Asia for processing, then shipped back to New Zealand for sale in our supermarkets. This is madness.
Both the International Monetary Fund and the credit rating agencies have said New Zealand’s biggest weakness is that too great a share of our total exports is selling raw commodities like milk and logs at low prices. Instead, we need to be making something more valuable out of our milk and timber before we export them[xi]. That’s the Scandinavian way.
In case anyone has missed the headlines of the last few weeks about massive layoffs at Tiwai Point, Norske Skog’s Kawerau mill, Solid Energy’s Huntly and Spring Creek mines, Nuplex and APN in Auckland, and many, many others – manufacturing is in crisis in New Zealand.
40,000 manufacturing jobs have been lost since 2008 when National came to government and there are more layoffs to come[xii]. Some 65,000 more New Zealanders are unemployed[xiii] and that’s not counting what Bill English now calls the “safety valve”[xiv] of 54,000 other New Zealanders giving up and moving permanently to Australia in the last year alone – an all-time record.
So we desperately need a high-value manufacturing strategy in this country. Gone are the days when manufacturing was just some unskilled worker bolting two parts together. That style of manufacturing is now inevitably done in low-wage countries. In most cases, we simply can’t compete with Asia when it comes to large-scale, low-cost manufacturing.
However, we’re not out of the race, by any means. According to Statistics New Zealand, there are about 22,700 manufacturing businesses in New Zealand[xv], which together produce about $20 billion of sales[xvi]. $20 billion.
I believe we could triple that, not by lowering our environmental standards or paying our workers less, but doing what we do so well.
New Zealand is very good at thinking small and thinking smart. We can do small production runs of specialist items. We can process raw materials that were gathered nearby. We can produce products on demand for our local market or international markets.
Above all, we can think smart. We can take an idea from concept to manufacture, often on a budget that wouldn’t pay for lunch in America or Germany.
Should the government be backing the manufacturing sector? Absolutely. Just look to the Scandinavian example.
Prof Göran Roos, a leading Scandinavian industrial economist, points out that every dollar in manufacturing business leads directly to $1.74 in turnover elsewhere in the economy[xvii]. And he and others point out that with increasing linkage between manufacturing and high value services in global trade, you can’t win without manufacturing capability. Buy a new car, get a regular servicing package.
The Scandinavians understand that a successful manufacturing strategy provides high-value jobs, good incomes, and helps reduce our overseas debt.
Labour will work with unions and businesses to enhance skills training to help support a strong manufacturing heart. The heart of a high-performance manufacturing sector is highly-productive workplaces with excellent training and decent living wages.
Like in the Scandinavian countries, we want workers to have the training and support to adapt to changing jobs with ‘flexicurity’ throughout their lives. Flexicurity: it means ‘flexible security’[xviii].
This is important. Look at what’s happening with the West Coast coal miners. After a lifetime of hard work in the coalmines, these miners are now facing the economic scrapheap[xix] thanks to National’s plans to railroad the sale of Solid Energy. The miners must now adapt to a changing world. Can they do this overnight? Of course not.
That’s where the government can help, not with a handout, and not by lowering environmental standards or strip-mining national parks, but with an investment in the future of those workers and an investment in the future of our entire country. It’s time to recognise that our most valuable resource is not just our land, but our people.
Clean and green
Another crucial sector is clean-tech. Labour leader David Shearer has called for a clean, green and clever economy for good reason – there are almost seven billion people on the planet[xx].
It’s obvious now to most governments, including not only the Scandinavians but also most of Europe, China, Korea and Japan, that we simply can’t keep living the wasteful and destructive ways of the past. As government regulations around the world get tougher, there’s a huge global market for clean technology. That is, technology that makes more effective use of our precious resources while reducing pollution and wastage.
You may rest assured; our competitors are investing heavily in clean technology. Why is New Zealand not doing more to win in the global green race – the $6 trillion export market for clean-tech[xxi]?
There are already some great ideas being developed, but building a strong clean-tech sector will only happen if the government sends the right signals. For example, the more we require our power generators to act responsibly, the more we are encouraging the development of alternative ways of generating electricity.
But the National government is going the other way – scrapping Labour’s biofuels obligations and effectively wiping out the infant biofuels industry. Now they have the gall to say biofuels will save Kawerau[xxii]. Shameful.
Labour believes there is no inherent conflict between positive business and the environment.
Labour is not opposed to environmentally responsible mineral and energy exploration. However, Labour never forgets that most of New Zealand’s export dollars come from living things. A wise government, like a good farmer, needs to protect and nurture the source of our wealth.
We are interested in investments that have a win-win outcome. Investments that create jobs and exports, balanced with appropriate responsibilities to our communities and the environment.
Nobody in Parliament, and nobody in this room, will still be here in 100 years. However, those who follow us will enjoy the gifts we give and will endure the mistakes we make. That thought alone should make us pause.
GROWING JOBS AND HOPE
We need better from our government. We need a comprehensive strategy that includes planning, research, financial incentives and assistance with helping local companies sell their products overseas.
It’s not rocket science; it’s common sense.
Kiwis are very decent people. They know they’ve been conned by Neo-liberalism and its National-Act acolytes. They want to do something about it. They want to reclaim that wonderful sense of fairness, safety and honesty that used to be the hallmark of this country.
In my remarks today I have stressed three key things:
First, contrary to the failed Neo-liberal policies that got the world into this mess, it’s really clear to you, to me and to the incoming Labour government, that we all do better together when we all win together. Think Scandinavia. Think symbiosis.
Second, it’s in Kiwi DNA to understand farming – the role of government in helping to create an innovative, job rich economy should be like a good farmer.
- Tending the soil to get the fundamentals right. Irrigating it with capital and fertilizing it with skills and technology.
- Planting the seeds of future success through a step change in innovation.
- Having a plan for each paddock – our industry sectors and regions – so we can be the best we can be. Understanding that it is crucial to have high value manufacturing and clean technology developed alongside making the best sustainable use from our resources.
- And never forgetting that our most valuable asset is always our people. Investing in education, skills and lifelong learning; building decent high performance workplaces, and using the power of government to reward good business practices.
Third, we need a government that listens, that works in partnership, then takes action. We can rebuild this economy. We can make this country the envy of the world again. But we need a government that acts, like a good farmer, not one that just sits on the fence, watching the weeds grow, and letting the farm go to ruin.
REFERENCES AND READINGS
[i] Internet Movie Database, Gordon Gekko quotes, available at http://www.imdb.com/character/ch0012282/quotes
[ii] Keay, D. (1987, September 23), Margaret Thatcher interview, Women’s Own.
[iii] Schwab, K. (ed.), ‘The Global Competitiveness Report 2008–2009’, World Economic Forum, available at: http://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2012-13.pdf
[vi] Organisation for Economic Co-operation and Development (2012, June 7). Household saving rates – forecasts: Percentage of disposable household income, DOI: 10.1787/2074384x-table7.
[viii] Ministry of Economy, Trade and Industry of Japan. Briefing note.
[ix] Wishart, S. (2012, September 24), ‘Kiwi high tech for sale’, New Zealand Herald, available at http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10836029
[x] Ministry for Primary Industries (2012, February), Ministerial Inquiry into Foreign Charter Vessels, available at http://www.fish.govt.nz/en-nz/Consultations/Ministerial+Inquiry+into+Foreign+Charter+Vessels/default.htm
[xiii] Statistics New Zealand (2012), Quarterly Employment Survey: June 2012 quarter, available at http://www.stats.govt.nz/browse_for_stats/income-and-work/employment_and_unemployment/QuarterlyEmploymentSurvey_HOTPJun12qtr/Definitions.aspx
[xiv] Cited by Tarrant, A. (2012, September 21), ‘Record loss of migrants to Australia in year to August, Stats NZ says; Nearly net 40,000 cross Tasman to the ‘lucky country’’, interest.co.nz, available at http://www.interest.co.nz/news/61231/record-loss-migrants-australia-year-august-stats-nz-says-nearly-net-40000-cross-tasman-lu
[xv] Statistics New Zealand (2012, September 10), Survey and methods section, ‘Quarterly economic survey of manufacturing’, available at http://www.stats.govt.nz/surveys_and_methods/completing-a-survey/faqs-about-our-surveys/quarterly-economic-survey-of-manufacturing.aspx
[xvi] Statistics New Zealand (2012, September 10), Table 1: All Manufacturing section, ‘Economic Survey of Manufacturing: June 2012 quarter’, available from http://www.stats.govt.nz/~/media/Statistics/Browse%20for%20stats/EconomicSurveyofManufacturing/HOTPJun12qtr/esm-jun12-qtr-tables.xls
[xvii] Roos, G., (2012, June 29), Is Manufacturing in Decline?, special presentation.
[xviii] One European interpretation of ‘Flexicurity’ is detailed at European Commission – Employment, Social Affairs and Inclusion section (n.d.), Flexicurity, available at: http://ec.europa.eu/social/main.jsp?catId=102&langId=en
[xix] Sabin, B. (2012, September 25), ‘Spring Creek miner’s 5th redundancy’, 3news, available at http://www.3news.co.nz/Spring-Creek-miners-5th-redundancy/tabid/421/articleID/270538/Default.aspx
[xx] World Bank estimate cited in Google Public Data set. Granular global population analysis is available from the WolframAlpha knowledgebase (2012), available at http://www.wolframalpha.com/input/?i=world+population&lk=4
[xxi] Innovas, cited in Pure Advantage (2012, May), New Zealand’s Position in the Green Race, p. 2.
[xxii] Hon Steven Joyce, National Party MP and Economic Development Minister, cited by Radio New Zealand (2012, September 11).
Previous related blogposts
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… don’t forget to set your clocks forward by two years, and go out and vote!
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- Citizen A – Kim Dotcom/GCSB special -
- 27 September 2012 -
- Chris Trotter & Phoebe Fletcher -
Issue 1: How does the GCSB miss a $500 000 firework display by the person they are supposedly spying on? How incompetent can the case against Kim Dotcom get?
Issue 2: Why do so many NZers blame the parents for child poverty?
and Issue 3: 600 job losses in a week equals 600 families without an income – when does unemployment start impacting politically?
Acknowledgement (republished with kind permission)
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- Bryan Bruce, Inside Child Poverty
Michael Laws. I don’t really want to start a chain of debate on this man’s opinion about child poverty because I have traversed all he has to say before. Nor do I want to fuel his talk show. But because he has attracted some attention recently on the child poverty issue here are my comments.
Yes there are SOME parents in New Zealand who are not as good as they should be.
Yes there are SOME parents who drink too much or take drugs .
Yes there is also a child abuse problem in New Zealand we need to address which is not the sole province of the poor.
But blaming and finger pointing and ” what parents ought to do” does not help the child who turns up hungry and cold to school.
A child does not get to choose its parents.
It is my view that our community has a responsibility to the well being of ALL of our children . That’s why I want to see healthy school meals in ALL of our schools so that our children enjoy the same right to healthy living that Swedish children get everyday.
I have not published Mr Laws piece or supplied the link to it because it is my policy as the editor of this page that I will not publish anyone who wants to shout ” Bad parent” over the head of a hungry child.
There are many,many parents who ( thanks to the economic decisions made by almost 30 years of Neo-Liberal driven governments) are just finding it very, very tough at the moment.
We need to ring fence our kids in these cruel times – not betray them by turning our backs on their most basic needs and closing their schools.
Yes parents should behave responsibly.
But so should we – they are OUR children, OUR future, OUR responsibility.
Chris Trotter: Not So Great Expectations
Fairfax Media: Inequality is now at its highest level
Fairfax Media: Hungry kids scavenge pig slops
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In case anyone has been holidaying on Planet Key lately, and missed the latest shenanigans from the Ninth Floor of the Beehive, John Key has apparently abandoned his earlier principles rejecting possible coalition deals with Winston Peters. He has found new principles of “wait and see”.
In 2008 and 2011, Dear Leader Key was fairly adamant and all but promised to poke himself in both eyes with red-hot pokers, rather than go into any coalition with Peters,
But this blogpost is not about Key’s ‘principles’ which, as we all know by now, are so bendy-twisty ‘flexible’ as to be positively plasticine. When Key assures us that the sun will rise tomorrow morning, we still want to see it for ourselves. Just to make sure.
Indeed, another blogger – NZ Pundit – scarily predicted back in August 2008 that Key’s “read-my-lips’ rejection of Winston Peters, as a possible coalition partner, was little more than a “hollow promise“, and would change overnight if National found itself desperate for a coalition partner.
Fast forward to 2012 – National finds itself desperate for a coalition partner.
With ACT now a Dead-Party-Walking after one scandal too many and Peter Dunne effectively a One-Man-Party, that leaves the Nats with two options;
- The Maori Party. Does National really want to be beholden to a Maori nationalist party? Even if it is a paler-version of Hone Harawira’s Mana Party? Will the Maori Party make it back in 2014 anyway?
- The Conservative Party. Notwithstanding it’s quasi-religious flakiness, Colin Craig has managed to alienate about 60% of the population (women and gays) plus probably everyone else with two interconnected braincells. Even if National drops the MMP Party threshold from 5% to 4%, there is no likelihood Craig will increase his electoral support.
In reality, with John Key showing the amorality of a political serial-adulterer, he will take whatever option is on offer. Whether his coalition bedmate is the Maori Party or CCCP (Colin Craig’s Conservative Party) or a menage a trois of both, concerns him nought.
As long as he can cross that magic 61 or 62 seat majority (depending on over-hangs) is his sole concern.
To achieve that end, National’s back-room strategists have been working over-time and have fixed their laser-sights on Winston Peter’s New Zealand First.
Said strategists have taken a single approach to dealing with NZ First – with two planned outcomes.
In both scenarios, National makes overtures to NZ First and make it clear to the voting public that this time, Key will not resile from a National-NZ First Coalition . Key will make the age of super entitlement and promise of abandonment of asset sales two prime factors that Peters will find hard to reject. ( Peters is not as hard-line in his opposition to asset sales as he makes out. See “Peters switch on Asset Sales“)
A third common ground between the Nats and NZ First; if water rights is still a burning political issue, this will move NZ First to the right, into National’s camp, as both parties have stated positions firmly rejecting Maori aspirations on this issue.
First scenario; Despite been seen as “cosying up” to National, NZ First retains electoral support, and makes it over the 4%/5% threshold. With Peter Dunne, John Key leads a third term of a National-led coalition government.
Outcome: win for National and John Key.
Second scenario; As National electoral support drops and public hostility to John Key increases, any perceived “cosying up” between the Nats and NZ First is viewed with displeasure by Peters’ supporters.
NZ First’s supporters – traditionally seen as the “grumpy vote” – either do not bother to cast a vote on Election Day (as many of Labour’s supporters stayed away last November), or cast their vote for the Conservative Party or possibly Labour.
NZ First fails to cross the 4%/5% threshold, and loses their seats in Parliament. In effect, National has been toxic to NZ First. Why would voters support NZ First if appears they will be getting a National-led government? Those who vote NZ First traditionally do so as a protest vote against the incumbent government (whether Labour-led or National-led).
Outcome: win for National and John Key.
Both scenarios are a No Lose situation for National. Except that in Option #2, any perception of a “cosying up” by National to NZ First may mean the “kiss of electoral defeat” (again) for Peters. If National’s support drops further in the polls; if Key’s status of Preferred Prime Minister wanes; and if the Nats are seen as ineffectual in a stagnating economy – does Peters want to be “tarred by association” by a Party on the way out?
Many New Zealanders – especially those in the late 30s and older – will remember the events of December 1996.
Many voters viewed NZ First’s decision to coalesce with Bolger’s National Party as an electoral betrayal – especially when Peters had made several Key-like statements during the 1996 election campaign. These statements were unequivocal in denouncing National as a a potential coalition partner, and sent a clear message to the voting public,
Jim Anderton: Is the member going into a coalition with National?
Winston Peters: Oh no we are not. – Parliamentary Hansards, P14147, 20 August 1996
There is only one party that can beat National in this election that that is New Zealand First. – Winston Peters, 69 & 85 minutes into First Holmes Leaders Debate, TVNZ, 10 September 1996
Of course I am not keen on National. Who is?
… This is a government bereft of economic and social performance [so] that they are now arguing for stability. – Winston Peters, Evening Post, 25 June 1996
The prospects are that National will not win this election, that they will not form part of any post-election coalition. – Winston Peters, The Dominion, 5 October 1996
It is clear that this National government will use every means at its disposal to secure power… Come October 12… Two months ago I warned that the National Party would use every trick and device at their command to to retain their Treasury seats. – Winston Peters speech to Invercargill Grey Power, 26 August 1996
The Prime Minister [Jim Bolger] is not fit for the job and come 12 October he will be out. He should not get on his phone and call me like he did last time, because we are not interested in political, quisling behaviour. We are not into State treachery. – Winston Peters, Parliamentary Hansards, P14146, 20 August 1996
We believe the kind of politician depicted by Bolger, Birch, and Shipley is not to be promoted into Cabinet. As a consequence we will not have any truck with these three people. – Winston Peters, NZ Herald, 22 July 1996
We are a party that says what we mean and mean what we say, regardless of the political consequences. – Winston Peters, Speech to public meeting, 9 October 1996
Despite Peters’ assurances, on 11 December 1996 the public woke up to this announcement,
The following three years were harsh for NZ First, culminating in it’s tearing apart in late 1998.The party split in two, with the ‘rump’ NZ First, and breakaway ‘Mauri Pacific‘, led by Tau Henare (now a National MP).
NZ First was nearly annihilated in the following year’s General Election, with Peters barely retaining his seat of Tauranga,
The message from voters was crystal clear for Peters; supporting an incumbent Party to retain power was a ‘no-go’ . People voted for NZ First to get rid of the incumbent government – not prop it up.
Cosying up with the Nats will not serve Peter’s interests one iota. It will remind the electorate of the events of the late 1990s, and will harm popular support for NZ First.
Peters should consider; as opposition to National grows, why would people who oppose National vote for a small Party that may end up propping it up? The answer is; people will not vote for such a small Party.
This should serve as a warning to Peters and his Party: coalesce with National at your peril. History can repeat.
Previous Related Blogposts
Otago Daily Times - NZ First leads in ‘most loathed’ poll (8 October 1999)
Dominion Post – Key rules Peters out of National’s future (27 August 2008)
Sean Plunket – PM should ponder the Orwellian switch to the farmhouse (22 Sept 2012)
TV3 – Duncan Garner: John Key refuses to rule out Winston Peters (24 Sept 2012)
TV3 – Peters welcomes National coalition (25 Sept 2012)
TV3 – Video: Peters welcomes National coalition (25 Sept 2012)
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Nuplex joins a long line of other industries, manufacturers, retailers, government departments, SOEs, etc, who plan to shed jobs,
The announcement of redundancies adds to a shocking list of job losses this year alone,
- ANZ; 1,000 redundancies
- Wire by Design, 55 redundancies
- Hakes Marine; 15 redundancies
- Telecom; 400 redundancies
- Brightwater Engineering; 40 redundancies
- Pernod Ricard New Zealand; 13 redundancies
- Depart of Corrections; 130 redundancies
- Summit Wool Spinners; 80 redundancies
- Ministry of Foreign Affairs and Trade; 80 redundancies
- Cavalier/Norman Ellison Carpets; 70 redundancies
- IRD; 51 redundancies
- Flotech; 70 redundancies
- NZ Police; 125 redundancies
- CRI Plant and Food; 25 redundancies
- Te Papa; 16 redundancies (?)
- PrimePort Timaru; 30 redundancies
- Kiwirail; 158 redundancies
- Fisher & Paykel; 29 redundancies
- Goulds Fine Foods; 60 redundancies
- Canterbury University; 150 redundancies (over three years)
- Solid Energy;
363 redundancies460 redundancies
- Tiwai Pt aluminium smelter; 100 redundancies
- Axiam Metals; 44 redundancies
- Norske Skog; 120 redundancies
- Goodman Fielder; redundancy numbers t.b.a.
- Dunedin City Council/Delta: 30 redundancies
- Blue Sky Meats; 100 redundancies
- Kaipara Ltd/Stockton Alliance; 63 redundancies
- Wainuiomata New World; 44 redundancies
- Nuplex; 64 redundancies
- Newmont Waihi Gold; 20 redundancies
- Ministry of Justice; 70-200 redundancies
- Salisbury School in Nelson and McKenzie Residential School in Christchurch; 90 redundancies
- Rakon; 60 redundancies
What sets Nuplex’s announcement apart from others was this extraordinary statement from New Zealand Manufacturers and Exporters Association president, Brian Willoughby,
“New Zealand Manufacturers and Exporters Association president Brian Willoughby said Nuplex’s decision would have come after all other options were exhausted. “Nuplex would have been working really hard to be as effective as it could, like the other companies that have announced these closures and layoffs. This is the end game – they can’t make it work.”
He said the Government, and past governments, clearly understood the reasons why manufacturers and exporters were facing such challenges.
“They have all operated with benign neglect and let it get to this,” said Willoughby. “There are so many buttons that could be pushed.”
He said the Reserve Bank could lower interest rates, which would help keep the New Zealand dollar’s strength in check.”
“Benign neglect“, Willoughby calls it.
Another term is the free market in full operation.
Were it not for the fact that thousands of New Zealanders are losing their jobs on a weekly basis, pushing up the unemployment rate, I would find Willoughby’s remarks laughable.
Businessmen and women are quick off the mark to demand less State interference and more market de-regulation to suit their vision of a pure free market.
Both National and Labour governments have been happy to comply, reducing company tax rates, as well as personal marginal tax rates for high income earners.
In the last four years, company tax rates have been slashed from 33% to 28%.
Industrial labour “reforms” have included the 90 Day “trial rate” to allow employers to take on more staff more easily (and still unemployment is rising?!) since 1 Aprl last year.
And FTA deals are being planned all over the place.
If National was any more “business friendly”, politicians would be literally climbing into bed and sleeping with business people. (No inferences made.)
And business sector groups are now whinging that past governments “ have all operated with benign neglect “?!
As if Brian Willoughby’s whining wasn’t enough, Catherine Beard, executive director of Manufacturing NZ, made this stomach-churning complaint,
” She said measures the Government could take to address the strong dollar included reducing debt, to take the pressure off interest rates, and putting an end to “poor quality spending” such as Working for Families and student loans. “
Yeah. Why should families raising kids and young people starting out in life get all the breaks, huh?
I look forward to Ms Beard advocating an end to namby-pamby laws protecting workers’ conditions so that children can have real choices in life.
Like whether to work in sweat shops or clean the insides of chimneys.
Choice is important.
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Two previous polls this month showed a slight increase for National, and a small corresponding drop for Labour,
National – 47.9% (+0.45)
Labour – 32% (-2%)
Greens – 10.7% (+1.6%)
NZ First – 5.5% (+1.1%)
ACT – Dog tucker
Source: Herad Digipoll 11 September 2012
National – 46.5% (+2%)
Labour – 31% (-1%)
Greens – 12.5% (-2%)
NZ First – 4.5% (-0.5%)
ACT – still dog tucker – with biscuits thrown in
Source: Roy Morgan 13 September 2012
Which makes a recent TVNZ/Colmar Brunton Poll somewhat odd, as it appears to break the trends shown in the above two polls,
National – 45% (-3%)
Labour – 34% (+2%)
Greens – 12.0% (n/c)
NZ First – 2.0% (-1%)
ACT – dessert, leftover humble pie
So two polls show National tracking up – and one shows the same Party dropping. Which is correct? Which is the ‘rogue poll’?
This blogger opts for the latter, the TVNZ/Colmar Brunton Poll.
With National’s recent strategy to paint Maori water claims as “greedy” and maintaining that “no one owns the water” (as opposed to coal, oil, and gas being sold to power thermal electricity generation) ; and Bennett’s relentless beneficiary-bashing proceeding at Warp Factor 9 – it is hardly surprising that the Nats are rising in the polls.
This is the same dog-whistle politics which Don Brash used during his stint as leader of
Labour Greens ACT Mickey Mouse Party the National Party (finally got the right one – hard to keep track of The Don, these days) in January 2004 during his infamous “Orewa Speech”.
The racists and low information voters loved it. Whether bashing the “lazy druggie benes” or bashing the “lazy greedy Mow-ries” – National and ACT know they can always rely on exploiting this country’s latent prejudices to secure some increased electoral support.
The Nats enjoyed a stunning 17% meteoric rise in the polls in 2004, thanks to Brash’s odious speech, that would’ve made a certain German Corporal proud.
The TVNZ/Colmar Brunton Poll is definitely rogue.
It is too early for the punters to cotton on to the fact that National Party strategists, beavering away in their little dens on the Beehive’s Ninth Floor (or basement dungeon, or where ever Key keeps his Orc-ish minions) are conning them Big Time. Diversion and distraction – the oldest game in the political book to keep the Middle Classes from realising that National is failing to rev up the economy and unemployment is on the rise.
I am reminded of playing with kitty cat with a bit of string…
It works similar with the Middle Classes. But instead of string, use bene-baiting or “standing up to dem Mow-ries“. Guaranteed to work.
This blogger still believes that we are in line for a change in government come 2014 (or earlier). Eventually, the Middle Classes tire of hearing the unemployed, solo-mums (but never solo-dads), Maori, etc, demonised and begin to realise that National has nothing positive to offer.
That is when people realise that the Emporer has no clothes. *ick*
As a side issue…
Colmar Brunton brags on its website that it “ is delighted that the One News Colmar Brunton Poll is noted as the poll that most closely predicted the 2011 election “.
According to their own data, they are nothing of the sort. In fact, Roy Morgan achieved closer Party polling than Colmar did. The closest polling figures to actual Election Night voting results are marked in red,
Colmar Brunton got four results closer to Election Night with scores for the Conservative Party, Labour, Greens, and Mana.
Roy Morgan got five scores closer to Election Night; National, ACT, United Future, Maori, and NZ First.
If you’re going to brag that you do a better job than your competitors, it might be a good idea to back it up with real evidence. (At least 50% of respondents agree with that assertion… )
Interestingly, Colmar Brunton generally got it right with the opposition parties (except for Conservatives) whilst Roy Morgan generally got it right with the government coalition parties (except for NZ First).
Previous related blogposts
As predictable as the rising sun (11 Sept)
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To our great shame, one of the world’s most endangered species, the Maui’s Dolphin, now has less than 55 individuals left. The species is 54 deaths away from extinction.
It’s close cousin, the Hector’s Dolphin, numbers around 7,000-8,000 – a drop from 30,000 in the 1970s.
Each year 23 Hector’s dolphins are drowned in fisher’s nets.
Set nets have all but destroyed these air-breathing mammals in our insatiable rush to strip the seas of edible fish.
On 28 June, Primary Industries Minister David Carter announced,
“I have decided to extend the recreational and commercial set net ban in the Taranaki area, from Pariokariwa Point south to Hawera, with an offshore boundary of 2 nautical miles (nm)…
In addition, due to the level of uncertainty in information relating to Maui’s dolphin presence in the area, I have decided to prohibit the use of commercial set nets between 2 nm and 7 nm in this area without an observer onboard.
- report start and end positions of nets set between 2 and 7 nm from shore; and
- report dolphins sightings to DOC.”
Which seemed remarkably less than what was required to save Maui’s dolphin and prevent Hector’s dolphin from sliding further toward extinction.
On 21 September, Radio NZ featured a report about New Zealand’s governmental delegation to the International Union for Conservation of Nature’s conference, held in Korea. Shockingly, our delegation voted against strengthening measures to protect Maui’s and Hector’s dolphins,
Radio NZ: Listen to more on Morning Report
It must be one of the few occassions in our history that New Zealand has voted against a conservation measure in an international forum, focusing specifically on an endangered species within our own territory.
There must have been several raised eyebrows at that Conference.
How much longer can call ourselves “100% Pure – Clean & Green”? (Maybe 70%?)
On 12 June, John Key fronted a “Live Chat”, hosted by Fairfax media, where he answered questions put to him by readers.
See Previous blogpost: Fairfax – an hour with Dear Leader
One of the questions put to him referred to endangered dolphins in our waters,
What is the govt doing to prevent the extinction of the Maui dolphins? DETAILS! Not just “we’re working on it” NZ wants answers. We want a moratorium on set net fishing.
12:28 John Key:
We are very close to making an announcement in relation to that issue. Stay posted.
That tantalising hint of “an announcement in relation to that issue” raised hopes that National was set to take firm, decisive action to preserve both species from the abyss of permanent extinction.
No such luck.
By now we should be used to National stating lofty goals – and taking the lowest road possible to the easiest, cheapest outcome. An outcome we live to regret later.
In two years, Maui’s dolphin may be extinct.
That’s one hell of a “legacy” for John Key’s Prime Ministership to be remembered by.
Forest & Bird: Hector’s Dolphins: Distribution
Previous Related Blogpost
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The latest liberalisation policy from National; changing the frequency of Warrants of Fitness for new and older vehicles,
I have an uneasy feeling about National’s proposals…
On one hand, it would be easier and cheaper to have my car checked for a WoF once every six months. Who could say ‘no’ to saving $40 or $60 a year?
On the other hand, a lot can go wrong with a car in one year. As mechanic, Don Sweet, told Radio New Zealand’s Nine to Noon programme,
“When you talk about the repairs, I’ve found steering joints falling off, brakes worn right out, brake hoses cracked to bursting, rusted brake pipes, tyres with steel cords coming out.”
So why my apprehension? What is it about National’s liberalisation of this regulation that causes my ‘spidey-sense‘ to tingle, with on-coming danger?
Perhaps because we’ve been down this road before – with disturbing and tragic consequences,
Despite Minister Williamson attempting to duck responsibility, the de-regulation of the Building Industry, as well as the Mining Inspectorate, can be sheeted home fairly-and-squarely upon National’s neo-liberal shoulders.
As part of an ongoing agenda of transforming New Zealand society and economy into a de-regulated free-market, with minimal state over-sight, both Rogernomics Labour and National pursued liberalisation to the exclusion of common sense, safety, and consequences.
Those politicians responsible for the mess they created; the billions of dollars in damage; and lives lost, continue to abrogate all responsibility for the last two decades. Yet, many of those same politicians are still in office today.
The liberalisation of Warrants of Fitness for vehicles sounds like a good idea.
But so did de-regulation of the Building Industry and Mining Inspectorate, at the time.
One would like to think we have learnt our lessons over time, but it appears not. Our propensity for collective amnesia is as much a part of our nature as it ever was.
Liberalisation of vehicle safety standards: this will not end well.
Previous related blogpost
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NZ Herald “chief political commentator” seems to have taken issue with bloggers. Well, two bloggers, mostly,
Armstrong’s bizarre comments were… well, bizarre.
Personally, I put it down to an unholy mixture of jet-lag*; long nights; too much/too little caffeine; mid-life crisis; with a fair whack of frustration. Something has obviously crawled up his bits.
In fact, his comments in his column (above) were not just downright unprofessional, but suggestive of poor health. Comments like,
“Here is a blunt message for a couple of old-school Aro Valley-style socialists…”
“Get off our backs.’
“Stop behaving like a pair of tut-tutting old dowagers gossiping in the salons.’
“In short, stop making blinkered, cheap-shot accusations of the kind you made this week…”
And those were in just the first paragraph. After that, it was all downhill.
The tirade was directed at two gentlemen, Gordon Campbell and Bryce Edwards. Both responded in their own ways, and style,
All three are worth reading.
All three speak volumes about the state of journalism in this country.
Firstly; John Armstrong represents the Old Guard of the Fourth Estate; conservative; part of The Establishment; close to government. In fact, how close to government was exemplified by this extraordinary statement from opinion piece above,
“The rapidly growing influence of Edwards’ blog was initially down to its being an exhaustive wrap-up of all of the day’s political news. It is now starting to develop a much more political dynamic that is unlikely to please National.”
With an admission like that, you begin to realise why someone like Armstrong would be so belligerent to the likes of Campbell and Bryce, who are hardly Establishment-types.
Since when was it ever the concern of a journalist whether what s/he wrote was ” unlikely to please National “?!
A journalist is not put on this Earth to “please National” (or Labour). They are here to tell us what’s going on – regardless of whether or not National (or Labour) are “displeased”.
That one remark validates every criticism every made of the NZ Herald that it is a clandestine mouthpiece for the National Party. There is no other way it can be interpreted.
Secondly; whilst Armstrong represents the Old Guard of journalism, Campbell and Bryce are part of the New Wave of Media. In large part, this involves the latest advent of mass-media, the internet. But the internet is simply the tool – it is an attitudinal sea-change that best encapsulates what Bryce and Campbell represent.
When Rogernomics engulfed this country, it introduced the concept of the “free market” and “choice” to our economy. Some of it benefitted our nation – much of it did not. Thousands who lost their jobs will attest to that.
But the liberalisation and de-regulation of New Zealand was not simply something applied to our economy. It reached into, and affected every part, of our society.
MMP, for example, did to the electoral/political system was the removal of tariffs did to the importation of consumer products; it gave the Voter/consumer a greater choice in who to vote for.
That same liberalisation encouraged the de-regulation of the Media. It was no longer the province of card-carrying journos, feature writers, and freelancers. Suddenly, anyone could get “in on the game”. The internet did for citizen journalists, bloggers, and non-establishment commentators what the typewriter and paid salaries did for mainstream journos.
The richest irony here is that John Armstrong is a cheerleader for the de-regulated free market – the same de-regulated free market that has pissed him off by letting everyone in on his turf.
Right about now, Armstrong should understand what it felt like when our shops were flooded with cheap clothing and shoes from Fiji, China, and India – whilst New Zealand seamstresses and shoemakers were forced out of business.
Or how Labour and National politicans felt when MMP changed our political landscape and Parliament was flooded with Greens, NZ Firsters, Alliance, ACT, etc.
The de-regulated free market is such a wonderful thing – until it’s your arse that is bitten.
Painful eh, John?
Armstrong complains about the tough nature of his job – especially accompanying John Key and his entourage to the APEC conconference in *Vladivostok last week.
Perhaps instead of writing travelogue pieces (see: Curse of Russky Island strikes ) he might have considered writing about Key’s pursuit of a Free Trade Agreement with Russia. This might have been a worthy topic, considering that Russia appears to have an unhealthy, close relationship with the Russian Mafia. (See related blogpost: A FTA deal with Russia?! That’s a big “NYET” Comrade Key! )
Even the Guardian and Washington Post felt the situation warranted some decent investigative journalism. (See: The farce of Russian elections , Russia’s presidential election: rigging is a delicate art, Putin’s government moves to quash public dissent )
But we got none of that (unless I’ve missed it).
A story of a sovereign state that appears to have close connections to gangsters would seem to be much more of a story than interesting scenery in Vladivostok. That might’ve made an interesting story for Armstrong to pursue – especially if we’re going to be cosying up to our Russian cuzzies with a FTA.
Newsworthy, I would have thought.
Previous related blogpost
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… when they voted for National last year?
Note, especially, Key’s response to Metirea Turei’s questions, and Key’s flippant response. Not exactly “Prime Ministerial”, one would think?
Wouldn’t it be cheaper to have this guy as our Prime Minister instead,
He’d be considerably cheaper than the $411,510 currently paid to Dear Leader Key.
And considerably less threatening to Christchurch schools; the unemployed; our conservation lands; workers’ rights and conditions; and other issues currently facing our country.
Who knows? Mr Clown above (the one with the bright yellow flower – not the one in the suit) might actually have a few decent ideas how to create jobs for the 162,000+ unemployed in New Zealand.
He sure couldn’t do worse than the clown (the one in the suit, not the yellow flower) we already have.
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- 13 September 2012 -
- Claudette Hauiti & Phoebe Fletcher -
Issue 1: Feeding kids at school – everyone seems to want to do it except the Government – who is responsible for hungry children – the parent or the State?
Issue 2: Latest round of beneficiary cut backs now look to punish the child for the sins of the parent – has Paula Bennett gone too far or will she go further?
Citizen A broadcasts 7pm Thursday Triangle TV – This blogger recommends ‘Citizen A’ as intelligent analysis of current affairs.
Acknowledgement (republished with kind permission)
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How to divert the Television Generation public;
Strategem #1: Blame it on dem filthy lazy benes! (*tick*)
Strategem #2: Stand up to dem lazy, uppity Mow-ries! (*tick*)
Strategem #3: Host an international sporting tournament! (Did that last year.)
Strategem #4: Declare war on someone! (Fiji? Kermadec Islands? A passing iceberg?)
Strategem #5: Invite some Royals to visit! (Clothing optional)
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- Penny Bright
“How many billion$ of public monies could be saved by ‘CUTTING OUT THE CONTRACTORS’?
Where’s National’s ‘corporate welfare’ reform?
Which of the major political parties are pushing for ‘corporate welfare’ reform and shrinking the long-term dependency of the private sector on our public monies?
Where is the ‘devilish detail’ at both local and central government level – which shows EXACTLY where our public rates and taxes are being spent on private sector consultants and contractors?
Why aren’t the names of the consultant(s)/ contrators(s) – the scope, term and value of these contracts, published in Council or central government Annual Reports – so this information on the spending of OUR public monies is available for public scrutiny?
Where are the publicly-available ‘Registers of Interests’ for those local government elected representatives, and staff responsible for property and procurement, in order to help guard against possible ‘conflicts of interest’ between those who ‘give’ the contracts and those who ‘get’ the contracts?
Where’s the ‘transparency’?
Given that New Zealand is ‘perceived’ to be the least corrupt country in the world – along with Denmark and Singapore, according to Transparency International’s 2010 ‘Corruption Perception Index – shouldn’t we arguably be the most transparent?
Going back a step – where are the New Zealand ‘cost-benefit’ analyses which prove that the old ‘Rogernomic$ mantra – public is bad – private (contracting) is good’ can be substantiated by FACTS and EVIDENCE?
At last – someone – somewhere has actually done some substantial research – which proves the opposite.
That ‘contracting out’ services that were once provided ‘in-house’ is actually TWICE as expensive.
“USA Project On Government Oversight (POGO) decided to take on the task of doing what others have not—comparing total annual compensation for federal and private sector employees with federal contractor billing rates in order to determine whether the current costs of federal service contracting serves the public interest.
Based on the current public debate regarding the salary comparisons of federal and private sector employees, the Project On Government Oversight (POGO) decided to take on the task of doing what others have not—comparing total annual compensation for federal and private sector employees with federal contractor billing rates in order to determine whether the current costs of federal service contracting serves the public interest.
The current debate over pay differentials largely relies on the theory that the government pays private sector compensation rates when it outsources services. This report proves otherwise: in fact, it shows that the government actually pays service contractors at rates far exceeding the cost of employing federal employees to perform comparable functions.
POGO’s study analyzed the total compensation paid to federal and private sector employees, and annual billing rates for contractor employees across 35 occupational classifications covering over 550 service activities. Our findings were shocking—POGO estimates the government pays billions more annually in taxpayer dollars to hire contractors than it would to hire federal employees to perform comparable services. Specifically, POGO’s study shows that the federal government approves service contract billing rates—deemed fair and reasonable—that pay contractors 1.83 times more than the government pays federal employees in total compensation, and more than 2 times the total compensation paid in the private sector for comparable services. ”
The implications of this both nationally and internationally are HUGE.
If NZ central government figures are comparable with those of USA Federal Government – could the current NZ $82 billion central government spend be sliced in half by $40 billion ‘CUTTING OUT THE CONTRACTORS’?
Which political parties / candidates are focussing on the SPENDING of public monies, rather than debt and borrowing?
If central and local govt departments /SOEs / CCOs / Crown Research Institutes are all defined as ‘PUBLIC- BENEFIT ENTITIES’ as defined under NZ Equivalents to International Financial Reporting Standards (“NZ IFRS”) – then their primary objective is to provide services and facilities for the community as a social benefit rather than make a financial return.
So – how come so many services that USED to be provided ‘in-house’ are now contracted out to the private sector – whose primary objective is most certainly to ‘make a financial return’?
What magic is this that transforms public (ratepayer and taxpayer) monies into private profit?
WHERE IS THE NZ EQUIVALENT OF ‘POGO’ the USA ‘Project On Government Oversight ‘ which has just completed first-ever research which proves that private contractors cost twice as much as ‘in-house’ providers of Federal Government services?
HOW MUCH MONEY could be saved in NZ at central and local government by cutting out all the private ‘piggies in the middle’ with their greedy snouts in our public troughs?
Why aren’t the statutory ‘third party’ Public Watchdogs, as well as other major political parties demanding this accountability?
How much public money at central and local government level could be saved by ‘CUTTING OUT THE CONTRACTORS’?
Who else is even asking this question?
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Previous Blog post
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Continued from: Latest Roy Morgan Poll shows change of government
The latest Roy Morgan Poll (27 August - 9 September)showed a predictable rise in support the National Party at 46.5% (up 2% since August 13-26, 2012),
Translated into seats,
National – 46.5% – 56 seats
Labour – 31% – 38 seats
Greens – 12.5% – 15 seats
NZ First – 4.5% (likely to increase to 5% in 2014)– 6 seats
Maori Party – assuming – 2 seats retained (possible) (3 seats, unlikely)
Mana Party – 2 seats (possible)
Peter Dunne – assuming 1 seat retained (possible)
ACT – 0.5% – assuming Epsom lost – no seats (probable)
Labour, the Greens, and NZ First dropped minutely, and ACT is heading for Zero Percent territory.
Seen in a Left-Right bloc context;
Labour-Greens-NZF-Mana: 61 seats
National-Peter Dunne-Maori Party: 59 seats
The figures are not at all surprising. This blogger predicted that National will experience a “bounce” in the polls as it engages in dog-whistle politics.
Bashing the unemployed, solo-mums (but never solo-dads) and other welfare beneficiaries and “standing up to greedy Mow-ries” is always a vote winner with low-information voters.
Don Brash’s “Orewa Speech” in January 2004 was racist dog-whistle politics that pandered to the lowest common denominator in New Zealand politics.
It also gave National a temporary boost in public opinion polls, rising 17% in a subsequent TVNZ Colmar Brunton poll.
17% increase in public support – a sad “reward” for a racist speech that pandered to our most base instincts.
The SOE water rights issue and bene-bashing is a predictable strategy for any right wing Party to employ, to boost public poll support. At the moment, National has very little else to rely on – the news from the economy is all bad.
National may stop at abolishing the Treaty of Waitangi and “nationalising water and air”, and may think twice before demanding that all welfare recipients sew black triangles onto their clothing – but I’m sure several of them have fantasised over the prospect.
This blogger predicts that National may indeed rise another percentage point or two – but like the aftermath of the 2004 Orewa Speech, the Nats will fall back as peoples’ irrational racist fears subside and poor economic indicators and poverty continue to dominate headlines.
We are still on course for a change of government in 2014, if not earlier.
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Lifted from the media today,
When the Leader of the pro-capitalist National Party starts talking about “nationalising elements such as water and wind” – whilst at the same time instigating a programme to partially privatise Genesis Energy, Mighty River Power, and Meridian – the question has to be asked; has John Key flipped his lid?!?!
Regardless of whatever atmosphere they are breathing on the Ninth Floor, there must be some severe oxygen depletion at work to have affected Key’s mental processes so badly.
New Zealanders from both ends of the spectrum, Left and Right, as well as the general populace, must be wondering what is going on in the land of Planet National.
Right wing National supporters must’ve wondered if they had heard their Dear Leader correctly when he uttered the taboo “N” word (“nationalisation – not “n—-r”).
The Left would have been rolling their eyes and shaking their heads in dismay, and wondering, “How much more of this clown will the public take? Does he have to decapitate and eat a kitten before his popularity takes a nose-dive and drops lower than John Banks’ credibility?”
Nationalisation of water and air…
Whilst selling of our state assets at the same time…
The breath-taking audacity of the man.
In reality, what he is saying is that the government is toying with the idea of making a grab for certain natural resources – before selling them to private investors.
His comment is as ludicrous as his statement on TVNZ’s Q+A on 16 September when he dumbly blurted out,
“ … So if you accept that viewpoint, then I think you have to accept that elements like water and wind and the sun and air and fire and all these things, and the sea, along with natural resources like oil and gas, are there for the national interest of everyone. They’re there for the benefit of all New Zealanders, not one particular group over another. “
Yeah, right, Dear Leader. I’m sure that came as a bit of a surprise to the private oil and gas companies currently exploiting our gas and oil fields.
John Key – always a laugh a minute with his incredibly outrageous remarks. Unfortunately, his clownish behaviour is ultimately at our expense.
= fs =