Tuesday, 23 August 2016


For most New Zealander’s under about forty, the stories of industrial disruption in the 1970s and early 1980s seem like fantasy. The thought that a small group of members of the Boilermakers’ Union was able to hold up the construction of Wellington’s BNZ Tower or Auckland’s Māngere Bridge for years seems too far-fetched to be true. Yet it was, as was the regularity that the Cooks’ and Stewards’ Union or the Seamen’s Union were able to find an excuse to go on strike at various holiday periods, tying up the Cook Strait ferries and disrupting travel plans. And who would have ever thought a union secretary would be brazen enough to go on national television during such a strike to spit out “the travelling public can go to hell” as did the National Union of Railwaymen Secretary Don Goodfellow. Strange as it may seem now, this was all very much the way of the world then.

Thankfully, those days are behind us and a generally more reasonable industrial relations climate prevails today. But every now and then there is a return to a mild approximation of the old ways. Ironically, though, today it is more likely to be employer groups resorting to the tactics the media of the 1970s and 1980s would have screamed against as “bully-boys”, “stand-over tactics”, or “industrial muscle”. A recent example has occurred over a relatively innocuous Labour Party Bill to give more protection to contract workers in vulnerable situations. The Bill has been making its way through Parliament over recent months, with barely a ripple, but suddenly, the employers have noticed it, and they do not like it, so like the militant unions of old they have pushed the outrage button.

Of course, their means are a little different. Mass email campaigns from people put up by their bosses, having been told only a fraction of the story, and simplistic media bluster and derision are the modern forms of industrial bullying, but the intent is no less different from the unions of old – to get their own way, come hell or high water.

A reasonable person will quickly see the farce for the sham it is and ask the likes of the Employers and Manufacturers Association and Business New Zealand why the tub-thumping has been left too so late in the day. The truth in this instance is that both organisations have missed the plot altogether, have failed to understand or even take any notice of what was going on in Wellington, and have treated the Parliamentary process in a cavalier way bordering on contempt. After all, they are employers, and Parliament needs to bend to their will. So the fury overdrive had to begin at the eleventh hour. Consequently, they will have no credibility in the future when it ever comes to criticising unions for industrial behaviour, which seems foolhardy. It is also a salutary reminder that while conflict and bluster are easy to manufacture, which is why they resort to it, constructive engagement is harder and requires more effort. Ironically, again, that is the same argument employers have used to debunk union claims in the past, yet they see no shame in doing the same themselves when it suits them.

At least the militant unions of the 1970s and 1980s had a point of principle (albeit rather warped) behind their industrial arrogance – today’s employers are just more interested in covering their butts for their own ineptitude. Hardly a good look, nor a reason to take the future pronouncements of the EMA and Business New Zealand at all seriously.    

  

 

 

 

 

Tuesday, 16 August 2016


Last week’s flurry about whether Uber was complying with the law and should be shut down if it was not missed the point entirely. Of course, Uber should comply with the law of the land – that is a given for any business operating here – but that was not really the issue. The bigger point that no-one seemed even willing to acknowledge, let alone grapple with, was how businesses like Uber are changing business models across the world, and how inadequate current law is to deal with that change.
Companies like Uber, its accommodation equivalent AirBnB, the on-line retailer Ali Baba, even Babylon, the British on-line medical service are both everywhere and nowhere. They are everywhere in terms of their pervasive on-line reach across the world, but they are also nowhere in that they have no designated headquarters or tangible fixed assets. They operate literally in the cloud.
Yet our traditional business model is very different. Since the Industrial Revolution it has been the custom for businesses to operate from fixed sites, producing a range of tangible goods, that can be sold (and/or shipped) to merchants around the world, who then on-sell to local distributors to retail to the public. It has been possible at every stage to identify who the business was, where it was located, and for tax and customs authorities to extract their pound of flesh for national revenues accordingly. That is the premise on which the international trading system has been founded and still continues to operate.
The development of containerisation in the 1970s was probably the first chink in its armour because it allowed for the introduction of “just in time” production where goods were produced and supplied as needed, thus reducing the requirement for merchants to hold large inventories. This in turn led to the breakdown of tariff barriers, so that the role of the domestic wholesaler as the middle man with the large mark-up was steadily reduced. But the system still operated fundamentally as before, because of the constraints of shipping and communication.
As technology improved, and aircraft capacity dramatically increased, further cracks appeared. Warehouses the world over rapidly disappeared, leaving behind many derelict waterfronts, now being redeveloped as vibrant living spaces as a consequence. The development of the internet in the 1990s led to the rise of the e-businesses like amazon.com, or our own equivalent fishpond.com, and the rapid explosion of on-line retailing.
And then came the issue of how to tax these large on-line increasingly multinational ventures. The Google story, which frustrated governments the world over (including ours) because they paid so little tax everywhere, and gave rise to the creation of exotically named tax avoidance schemes like the Irish Wedge or the Dutch Sandwich, is  perhaps the classic, but by no means sole, example. And it led to the development of the OECD’s Base Erosion Profits Sharing programme in which New Zealand is playing a strong role to develop a fair and consistent way of taxing these multinationals across the world.
Uber and the companies like it are but the latest iteration of this dramatic change. And it will intensify. Business of the future will be as much the trade of ideas as business of the past has been the trade of commodities. New technology, the internet in particular, has broken both the tyranny of distance and the sanctity of national boundaries. Rigid national laws in New Zealand and elsewhere that try to enforce old ways of doing business are doomed to fail, as last week’s incident shows.
In Greek mythology, Sisyphus was pilloried for constantly pushing a heavy boulder uphill in a vain attempt to overturn reality. Today’s Sisyphusian equivalents are those regulators trying to make the likes of Uber fit the established business rules of conduct. It just will not work. For that reason alone, last week’s exchange should have been a significant wake-up call. Sadly, it seems it was just a regulatory irritant.          
   
  
 
 
 
 

Wednesday, 10 August 2016


Many of the 60,000 new New Zealanders each year deserve a better deal.
Numbers of them are forced to live in difficult circumstances; they are unable to fend for themselves, and no-one speaks up for them. Some are abused, others are assaulted or otherwise degraded. All are potentially vulnerable and we need to do better for them to avoid the opprobrium of the civilised world.
Already, the hackles will be rising amongst the racists and the xenophobes, the Trumpists and their acolytes in this country, who will be screaming in their ignorance why are we allowing these people to add to the pressure points they perceive to be already in our society, and why are we letting so many of them in every year. However, this group of 60,000 new New Zealanders a year is not made up of migrants or refugees, but is the number of children born in this country each year. Nearly 70% of them will grow up in a two-parent family; just under 20% will be raised in a sole parent household, and around 5% will have been born to a teenage mother. None of them will have any choice or control of their family circumstances, or how they will be raised subsequently, yet all of them will be profoundly affected by that environment.
Amongst these children are our future political, social services, academic and business leaders, our future sporting heroes and sadly, our villains. But whatever their destiny, they all have an arguably greater stake in the future of our country than we who have been around for a while. As a group, children under 18 years of age make up almost a quarter of our population. Yet few speak for them, and even fewer try to reflect their needs in policy formation.
That is what makes last week’s publication of a Children’s Covenant, under the guidance of Judge Carolyn Henwood, and Ngai Tahu leader Sir Mark Solomon so much more important. Their aim is as positive as it is stark – to “make a solemn and enduring covenant with our nation’s children, whoever they are and wherever they may be, in equal measure, those children who are born and those who are born in the future. We as New Zealanders undertake an unconditional duty to do all in our power to ensure that all our children are treasured, respected and enjoy a good life full of opportunity in a nation that is diverse and rich in culture and aroha.” Implicit in those goals is the recognition that every child has an equal right to access to opportunity in this country, every child has an equal right to access to quality healthcare and education, every child has a right to good housing and good prospects in life, and that the challenge facing all of us – and  that is what the covenant recognises—is to focus our efforts afresh on delivering those policies. It has often been said, but not yet achieved, that we have to put the interests of our children at the centre of government policies.
Against that backdrop, Parliament resumed this week to the usual cacophony of windbag rhetoric about housing and health, and all the hardy annuals, but amongst the shouting and the handwringing, the state of our nation’s children received no mention. Nor did the Children’s Covenant. Sadly, it seems, children are only of political interest when there is another horrific assault or murder, and an intemperate headline can be gained by strutting populists who can temporarily stop attacking other minority groups, like migrants, as the root of all our problems, to bang the law and order drum for a while. The cynicism is putrifying and sickening, yet incredibly there are New Zealanders prepared to lap it up. 
Our children simply deserve the best. We are failing them at present. The commitments contained in the Children’s Covenant are positive steps credible and responsible political leaders should willingly endorse, and seek to reflect in their policy deliberations. Yet so far, only three parties – the Greens, the Maori Party and UnitedFuture – have done so.
While the rest lag behind, our children suffer. For a country built on compassion for the vulnerable, that collective apathy is hardly something to be proud of
 
 

Wednesday, 3 August 2016


One hundred and forty years ago, in 1876, New Zealand abolished provincial government. From 1852, New Zealand had been governed through six Provincial Councils, similar to the Australian states of today, with the central government in Wellington having a much lesser role. However, while provincial government was abolished all those years ago in favour of a single national government, the inherent tensions between the provinces and the centre have never really been resolved.

Every now and then, they erupt into something stronger, usually associated with attempts by central government to “reform” local government in some way or another. At such times, the hostility and frustration each feels towards the other becomes that much more obvious. For example, a none too subtle subplot of the recent debate about the Auckland Unitary Plan has been a barely disguised central government view that the rigidity of the Auckland Council is a primary reason for the current housing situation, matched in return by an equally staunch view in Auckland that the problem rests with central government and its unwillingness to empower Auckland to deal with it.

Similarly, the currently rapidly erupting debate about central government plans to enable more shared services approaches to local service provision has local government seething that yet again central government is attempting to impose amalgamation by stealth on hitherto unwilling and unsuspecting local communities. For its part, central government sees huge potential efficiency gains in the delivery of local services being thwarted by the entrenched parochialism of local government unwilling to change. And so it goes on.

Worse, every government that takes office has local government reform high on its agenda. That reform is usually to undo the reforms of its predecessor, so local government is left caught in the constant tussle between those who seek to devolve more duties to them, and those who want to curb their activities to cut rates. So it was that the previous Labour-led Government introduced a power of general competence for local government, only to see that wound back by the current government, before it had really got off the ground.

This constant political tug-of-war has been the pattern since 1876, although there were signs of it from the outset of responsible government in 1852. It is as debilitating as it is petty, and its continuation is in no-one’s interests. It arises because from 1876 onwards, while there have been many reviews and Royal Commissions on the shape and form of local government, there has been no serious political attempt to define the relative roles of central and local government, or to establish any sustainable philosophical basis for that relationship. In the absence of that, nothing seems likely to change in the foreseeable future.

UnitedFuture is a strong believer in the liberal democratic principle of localism – which coincidentally underpinned the establishment of provincial government in 1852 and was tossed aside by its abolition in 1876 – whereby decisions are made at the point closest to where they have their impact. That is why we support strong and vibrant representative local government based on a network of community boards, territorial and district authorities, and regional councils. In turn, we see the need for a formal partnership agreement between central and local government, spelling out the roles and legitimate expectations and responsibilities of both, and a mechanism for resolving differences when they occur.

New Zealanders are understandably proud of our generally pragmatic approach, and the fact that rather than ruminate to the point of tedium over an issue, we just get on and resolve it. That is good and to be encouraged, although it does have the downside that sometimes our decision-making processes lack coherence and consistency as a consequence. This is especially so when it comes to our constitutional arrangements where their fluidity often means the process of government has a “look, no hands” feel to it. Moreover, our general national reluctance to confront conflict in any shape or form means we are past masters at avoiding problems if we possibly can, in the hope that a problem ignored is a problem diminished. All of these features have characterised the tension between central and local governments over the last 140 years.

Continuing to pretend that this tension “goes with the territory” is no longer acceptable. Both central and local government have significant but distinct impacts on people’s lives, so both need to be prepared to come to the table as equals, to agree their way forward. After 140 years, that discussion is long overdue.           

        

 

 

 

Tuesday, 26 July 2016


Within sixteen months New Zealand will have its next General Election. Prime Minister John Key will be seeking to equal Keith Holyoake’s record of four straight election victories. Opposition Leader Andrew Little’s goal will be more modest – he will be seeking to break the mould of his three predecessors and just win an election.

As always, the election will be as much a referendum on the government’s performance, as it will be a statement of how New Zealanders see themselves in the world of the time. A confident outlook will more than likely secure the return of the government of the day – a less certain or even negative outlook will obviously favour the Opposition. So the backdrop against which the election occurs will be as important as the domestic circumstances of the country at the time.

International events such as Brexit, the rise of Donald Trump, and mounting anxiety about terrorism and the insidious linkage of that to migrant and refugee policy are conspiring to portray a very unsettled and insecure world. And that, in turn, is leading to the rise of an “Up You” approach to politics from many voters who feel increasingly disenfranchised. Those whose jobs have been affected by the technology revolution and globalisation; those whose lack of tertiary education in the 1960s and 1970s has left them unequipped for today’s rapidly changing economic environment; and those who fear the social and economic security of their retirement will be threatened by society’s changing mix, all see politicians and governments as the cause of their anxieties, and are increasingly intolerant of politics, as they have known it, to do any good by them.

It is no surprise therefore that in such an environment the rise of non-politicians – like Donald Trump, Nigel Farage, or even on the left Bernie Sanders – appeals. Their simple solutions, seldom based on facts or evidence, are far more appealing when contrasted with politicians and governments offering measured, considered programmes that are now seen as ponderous and increasingly out of touch. The irony is that the age of instant communications and dramatic changes that has left these people feeling so disempowered, has at the same time led them to embrace instant solutions to the problems they perceive around them.

The question for New Zealand in the lead-up to next year’s election is how far that international mood of fear will have permeated our society, and what its impact might be here by the time we come to vote. Already, the racists and the xenophobes are lining up to pedal their messages of hate and division, but again ironically, they have been around here for so long, with so little success, it is a wonder anyone bothers to take them seriously. Prime Minister Key’s challenges as he contemplates 2017 are how he presents his government as still the government for the times, and how he deals with the seas of extremism starting to swirl around him. A superficial analysis might conclude that his task is an uphill one.

However, that ignores a couple of significant factors that might work in his favour. Last week, in Britain, the former Liberal Democrat leader, Paddy Ashdown, announced the formation, in the wake of Brexit, of a new cross-party group, More United, to fight across all political parties the extremism and intolerance now emerging in British politics. By all accounts, its message of supporting policies and MPs that are moderately progressive has been well received by people feeling the time has come to pull back from the brink of the abyss many felt they have been hurtling towards. An early sign, perhaps, that the tide is turning?

A second point is that by the time we go to the polls next year Trumpism will have either triumphed or been vanquished. If it has triumphed, then the message of progressive moderation may well likely be an attractive antidote around the world for what may be happening in the United States by then. If Trump has been defeated, then the same appeal is likely, but perhaps more in the mould of the “Never Again” mood that swept the western democracies at the end of World War II.

John Key is no historian, so will not necessarily be influenced by what has gone before him, but he is an astute observer of the human condition, with a sharp sense of political smell. His instincts would be strongly opposed to following the path of extremism, unlike some of his colleagues who would follow whatever path was available, so long as it led to National staying in power. So, the extent to which John Key is prepared to offer himself as the antidote to extremism, in the mould of the progressive moderate, is likely to determine whether he becomes the modern Holyoake.

After all, he too was a progressive moderate, long before the term was coined. That was why he won four elections.  

            


  

 

 

 

 

Wednesday, 20 July 2016


New Zealand is generally well regarded in the international community. That is probably one of the biggest things going for former Prime Minister Helen Clark (aside for the moment from her considerable and formidable personal skills and talents) in her bid to become the next United Nations’ Secretary-General. She comes from a country which is one of the oldest continuous Parliament democracies in the world, with a commitment to international co-operation (the role wartime Prime Minister Peter Fraser played in the formation of the United Nations is still widely recognised) and a reputation for speaking out (the Kirk Government’s stand against French nuclear testing in the Pacific and David Lange’s anti-nuclearism are legend). Even today, Prime Minister John Key is developing a reputation as a leader who speaks up in international meetings for the interests of small nations and the protection of human rights generally. If Helen Clark’s bid is successful, as all New Zealanders hope, our country will be justifiably proud to see our national values recognised on the world stage.

All of which makes the one great blind spot in our foreign policy that much harder to tolerate and understand. New Zealand’s 1972 decision to recognise the People’s Republic of China was hailed at the time as in the vein of the independence our foreign policy has become noted for. We were again forging a new path others may wish to have followed, but sadly, as the years have gone by, that independent streak has first weakened, then frayed, and now virtually disappeared altogether. As we have become closer to China economically and politically, our policy approach has simply become more timid and craven. When the Lange Government’s anti-nuclear policy was at its peak, international commentators used to describe New Zealand as the mouse that roared. Now, they could just as accurately describe us as the mouse that scuttled for cover.

Our foreign policy now has a desperate air to it. It is no longer about trying to secure our trading future, or playing our part in the Commonwealth and wider international community. No, New Zealand’s foreign policy today is all about not upsetting China. Even though we have a free trade agreement with China, and generally good political relations, we dare not use those links to speak out about issues of concern. Despite our laudable opposition to the use of the death penalty worldwide, we suddenly become mute when it comes to China, one of the most judicially murderous nations on earth. We pointedly state no view on China’s increasing incursions into the Pacific and its building of artificial islands in the South China Sea to extend its national frontiers. Only once international adjudication has ruled against China do we meekly state that maybe China should respect international law. Even this week, there have been reports that we are unwilling to do too much about reportedly inferior Chinese steel fabrications being used in local projects because China has apparently threatened retaliation against Fonterra and other exporters if we complain.

Now, of course China is a much bigger and more powerful nation than New Zealand, and of course, the relationship with China is far more important to New Zealand, than the other way around. As a consequence, there are those who argue it is a case of “beggars cannot be choosers” and we cannot expect China to play the game any other way. They were the same voices who said we could not take France to the World Court and expect to win as we did in the 1970s; or that we could not challenge United States’ nuclear defence policy and expect no retaliations, when we did so in the 1980s with little impact on trade and a temporary political frostiness which began to thaw from the time of Prime Minister Bolger in the early 1990s.

The sad thing is that these voices of timidity represent the policy of the Ministry of Foreign Affairs. Their cringing pathological fear of doing anything to upset China is not only weak and cowardly – it is downright humiliating and utterly embarrassing. It is time for New Zealand to grow some backbone when it comes to its relationship with the still dictatorial, authoritarian China.            

 

 

 

 

Tuesday, 12 July 2016


There has been much comment recently that we have entered a “post truth” era of politics, where politicians not only no longer tell the truth, but worse, have given up any pretence of doing so. According to this line of argument, what matters most with voters is the impression that a politician’s comment leaves, rather than its substance.

The most striking example the commentators quote comes from the recent Brexit campaign, where “leave” campaigners claimed that Britain’s membership of the EU was costing British taxpayers £350 million a week, which could be better spent on health and social services if Britain left Europe. In fact, the claim was quite untrue, but its simplicity struck a chord with disenfranchised voters. Similar claims are made in respect of the recent Australian election where it is argued that misleading texts from Labor sources about the future of Medicare under the Turnbull Government swung many voters in marginal seats. The Trump campaign in the United States offers similar examples as well – from the wall to keep Mexicans out, to the ban on Muslim immigration. The point is that, on any rational assessment, none of these things are either true or achievable, but in the “post truth” environment that is an almost immaterial consideration.

New Zealand politicians are learning the lesson, sadly it seems, if the current housing debate is anything to go by. A complex and difficult social problem with many levels to it is being reduced to inane, empty slogans (just build 100,000 “more bloody houses” to quote the elegant language of the rather crude Leader of the Opposition) without any regard to how all that might be achieved. To one political party, the housing problem is all the fault of the Auckland Council and the Resource Management Act, which resonates with its developer audience; to another, it is all because of immigration, which plays well with its xenophobic audience; and to another, the blame lies with property speculators, as that suits its style of envy politics. The common point is that not one more young family is being housed as a result of these positions. But, the political spin-masters would argue that is a secondary consideration to getting the parties’ respective brands across.

Oh really? The starting point surely has to be that there is a housing problem at present. We know about the Auckland situation, as that is the most obvious manifestation, but right across New Zealand young families are finding it difficult to finance themselves into a first home because of restrictive bank lending policies. There is also a shortage of available rental accommodation, and social agencies are reporting more and more genuinely homeless people.

These are difficult times for liberal, centrist parties like UnitedFuture because the “post truth” approach to politics shows little tolerance for reasoned and well-considered responses. Yet, in the interests of future generations, there are practical steps we should be taking to make progress on the housing front. We need a more inclusive approach through a Housing Summit, bringing together central and local government, the building industry, the Reserve Bank and the trading banks, and social housing providers to develop a comprehensive, integrated plan which all sectors can buy into and implement in a properly co-ordinated way. It is all very well, for example, to propose building more affordable homes if the banks are not prepared to lend to young families to buy them, as is the case at present. (In that regard, UnitedFuture has proposed allowing families to capitalise their Working for Families payments on an annual basis to help bridge the deposit gap or assist with mortgage repayments.)

Politicians of all stripes ought to be accountable for their actions. “Post truth” politics and the focus on slogans ahead of policy simply removes meaningful accountability. “Post truth” politicians are not leaders – they are mere charlatans strutting every stage and saying things they hope are popular and newsworthy, without any regard to practicality.

Simple solutions, bold ideas, call them what you like, rarely work, as history shows. Often, shattered societies are left to pick up the pieces. Unfortunately, the way the major parties are playing the housing debate shows every sign New Zealand is heading down that path. It is not something future generations will thank us for.