The $7.5b question: tax cuts; election spend up; something else?


The biggest government surplus in a decade has political and economic commentators thinking: What will Treasurer Grant Robertson do with a $7.5 billion surplus?

A few certainties arise even before that question can be considered:

  1. 2020 is election year and there will no doubt be thoughts of holding at least some of it to throw at election promises in a years time
  2. Certain parties who do not need to be named are going to want – and indeed have already promised – tax cuts, specifically income tax cuts
  3. With a shaky world economy getting ever more jittery with every passing month and the domestic economy not looking so hot, economists and some politicians are suggesting that the government needs a spend up to get things moving

I have long had ideas about what to potentially spend on in the past, which have been largely social areas such as health, education and social welfare. My understanding is that the calls in 2019 are for greater investment in infrastructure critical to the 21st Century.

This suits me fine, as I have a few ideas of what it could be spent on:

  1. Research and development of a potential biofuel programme relying on the waste stream for an appropriate fuel source – take several years to get this started, but if successful modest scale biofuel plants could be established in Auckland, Wellington and Christchurch
  2. Research and development of a Waste to Energy plant for the West Coast, which would be self sufficient in terms of electricity use
  3. Examine electrification of the South Island segment of the Main Trunk Line
  4. Invest in 5G technology nation-wide instead of letting the telecommunications companies do so for reasons of national security
  5. A substantial acceleration of the billion tree programme that was announced by the Government in 2017
  6. Support a mini-home scheme

But what if the Government decided on tax cuts? Whilst there might be enough to justify some I am personally against income tax cuts because the wealthiest are always the winners, when all should be able to gain fairly from them. Such a move would certainly not be welcomed by the left wing of New Zealand politics, who believe with justification that this would only favour the very few.

A more intriguing alternative is one that almost never seems to be up for discussion. Despite the right talking about fiscal responsibility, under the last several New Zealand governments significant debt has been accrued and much of it is still outstanding. Has the ever so radical idea that New Zealand should actually pay moreĀ  of it back not strike one as a useful idea?

National’s gang policy fails to understand gangs


A few days ago two announcements about gangs in New Zealand came out that concerned me. One was that the Mongrel Mob had just announced its first all female chapter. The second one was a National Party announcement that it will massively crack down on gangs should it be returned to power in 2020.

I agree that the development of an all female chapter in a gang is a worrying turn. No questions about that. It means that whilst those women might feel like they have a bit of family structure that in a past life they may have never had, the violence, the drugs and the likelihood of Child Youth and Family being after any children they have whilst in the gang becomes very real.

It is perhaps the National Party announcement that causes me the greater concern, because National are once again turning to methods that have been tried, but not proven.

I am concerned that in pursuit of political points so that National may return to power in 2020, it has forgotten the how and why of gangs like the Mongrel Mob and Black Power existing. Or perhaps it has not forgotten these two important factors, so much as it does want to acknowledge them point blank.

If the latter is the case, the policy is potentially setting up to fail before it has even been implemented. Gangs do not exist simply because someone woke up and said “I’m gonna start a gang today”. Often they form out of people who have been marginalized by society or come from dysfunctional families. The reasons for membership may include anything from getting hold of luxury goods or services, but also a family structure that they might have never known otherwise.

Mr Bridges may have forgotten that a former National Party leader – none other than Robert Muldoon – once had a whisky with a gang, which earnt him their respect, especially when nearing the end of his drink he threw it at them. I am certainly not suggesting he try that. I am sure that things have gotten less safe than when Mr Muldoon decided that actually meeting 20-30 Black Power face to face and trying to understand how they worked and why, was better than rounding them all up. But perhaps Mr Muldoon understood something about gangs that we and Mr Bridges do not.

It is not that I am hugely sympathetic to gangs. I am not – the whole culture around them I find very disconcerting, but if we are going to lessen the issues around gangs we should look at the how and why of their existence.

Perhaps the best thing we can be doing is putting the markets for nasty drugs such as synthetic cannabis, heroin, crack and methamphetamine out of business. No good has ever come of these drugs, and they are hugely destructive, but the war on drugs as led by the United States is a complete failure. The need to start treating drug use a mental health issue has never ever been greater or more immediate and it is only going to get worse if nothing is done.

In New Zealand synthetic cannabis and methamphetamine are causing the most damage. In some small impoverished towns the highest earning jobs are actually on the black market peddling one or both of these two to the local dealers. As medical cannabis should be legalized, rather than penalizing the people who try to make a life out of drugs, having the knowledge they probably do to grow high quality cannabis, perhaps enabling a small number of them to grow cannabis that gets converted to medicine would be a solution.

But would Mr Bridges and his law and order gang see it that way? I am not wholly sure that they would.

 

 

New Zealand First’s 2019 reality check


Yesterday New Zealand First Party President Lester Gray quit. His departure reminded me of the many others who have departed, having been stone walled or frozen out over the years.


In the 6 New Zealand First Conventions I went to, I saw much teeth gnashing over whether to support particular ideas and policies. Delegates would put ideas forward, and many would be accepte. But they would almost immediately be forgotten, almost as if the Board were just going through the motions.

Between the 2014 Election and my departure in May 2017 I saw enough of the internal politics of New Zealand First to wonder how the party had managed to last as long as it had without a full scale meltdown. The conclusion was that only due to the sheer diligence of the membership and one or two people on the New Zealand First Party Board of Directors was this scenario avoided.

After each election a debrief was had. During the intervening three years, Conventions came and went, at which policy remits would be passed and the party would pat itself on the back for surviving another year. However it continued to be dogged – and continues to be dogged – by a lack of basic accountability at Board level. During that time a constant state of paralysis managed to cripple many good ideas that had been put forward, which would go on to be forgotten about, stalled or dropped completely. Just a few of them are listed here:

  1. A New Zealand First Youth wing – a lack of focus on youth was one of the reasons for the party failing to pick up 5% of the vote in 2008, and a Youth wing was only formalized in 2015
  2. Presence on social media and associated management policy has not been finalised six years after being introduced
  3. Developing an election campaigning blue print that can be rapidly rolled out each election which everyone understands
  4. Letting Shane Jones join the party, leap frogging many members who had much bigger claims to being on the party list
  5. Fundraising, which despite the party being resurgent, is not something we are good at

The membership, despite largely being elderly, and often constrained by a board that seemed to be terrified of forward progress managed to get 8 list candidates into Parliament in 2011 and 11 in 2014. A 12th Member of Parliament joined after New Zealand First Leader Winston Peters won the Northland by-election in 2015.

The departure of Mr Gray on what he considered ethical grounds suggests to me that New Zealand First has an ethics issue. The party really needs to have a swift and decisive examination of how it came to this. With a Convention in Christchurch in 2 weeks time and an election in 2020 it will be interesting to see how this plays out for New Zealand First.

 

 

 

National’s tricky road to victory in 2020


Simon Bridges has a job to do. Take back the Government benches in 2020. He is the Leader of the Opposition in the New Zealand Parliament, Leader of the National Party. His job is in two parts:

  1. Is to destroy the policies of the 6th Labour Government.
  2. Come up with a credible alternative policy platform that New Zealanders like enough to walk away from Labour

Unfortunately for National, when environmental and economic pragmatism is needed, Mr Bridges is a conservative who believes the core philosophies of the National Party and the policy making traditional to these philosophies is just fine. Yet Mr Bridges must in the next twelve months destroy the policy making of Prime Minister Jacinda Ardern and make her utopian vision look bad enough that New Zealanders are convinced to vote blue instead of red.

But if Mr Bridges is willing to be pragmatic about environmental law and environmental issues there are things that he could do which would help the environment and the economy at the same time. These two alone will not be enough. and he will have to have sound social policy and the right people to push it. To make it happen though, he would need to replace a few lieutenants – Amy Adams who was one of the more pragmatic voices on judicial and women’s affairs is leaving Parliament. Chris Finlayson who was Attorney General in the Government of Prime Minister John Key and Bill English has also departed.

Mr Bridges faces another problem. I highly doubt that New Zealand First will work with National again whilst Winston Peters is leader. I can understand National’s disgust with New Zealand First after electing to support a smaller party instead of handing National an historic 4th term – which I think would lead to a decisive Labour victory in 2020 with well over 50 red seats if Mr English had been returned to power. National would have to swallow what I imagine would be a massive rat whole.

And then there is A.C.T. Its Leader David Seymour would doubtlessly be expecting a Ministerial Warrant in any negotiations as part of a future National-led Government. Mr Seymour has no time for climate changeĀ  Also, would Mr Seymour be prepared to work with one of A.C.T.’s biggest enemies, New Zealand First and could Mr Bridges keep the two happy in the improbable situation where they agreed to?

But perhaps the biggest problem facing Simon Bridges is the same thing that toppled successive Labour leaders between 2008-2017: preferred Prime Minister ratings. Ms Ardern might be down on the historic high she hit after the Christchurch mosques were attacked, but she is well ahead of Mr Bridges who is being challenged by fellow National M.P. Judith Collins, whose preferred Prime Minister rating is the same as his.

National has a long road ahead of it if the party wants to return to the Government benches in 2020. It has some big decisions to make around refreshing the Members of Parliament so that they do not become deadwood, policy and building a rapport with New Zealanders. There are deep crevasses in the form of environmental and social policy on one side and the deregulated, minimalistic governance that A.C.T. favours on the other side. Mr Peters and Mr Seymour represent potential obstacles or opportunities depending on their own parties fortune.

It could be a very interesting 12 months.

The need to keep National on board with climate change


Every nine years (the average for the last 30 years)there is a change in Government. With it there is the inevitable change in policy focus, emphasis on what is important, what will become – in the words of former Treasurer and Prime Minister Bill English “nice to haves”. Some fields of policy that needed further progress will stall, whilst other areas of importance will get more focus on them.

In the case of National, there is the sure fire certainty that a new National led Government will have a strong economic focus. Just as we would expect Labour to focus more on social issues and the Greens on the environment, we should know to expect by now that National will have an economic focus whether we like it or not.

One catch is recognizing that an M.M.P. environment requires compromise. In an M.M.P. environment you need allies in Parliament. These are parties that will become potential coalition partners. As such National is unlikely to want to dispense of A.C.T. and therefore there will always be an element of outright denialism in any government that forms. The only way to get rid of it would be to persuade Epsom voters that A.C.T. is a liability.

The same environment that stops fringe parties hijacking the discourse is the same one that is discouraging, with the aid of a lingering “Think Big” hangover, really visionary policy making. New Zealand has shown a real adversity since the late 1980’s to introducing really forward looking policy and the matching steps to make it happen. We need visionary policy with those matching steps if we are going to tackle the environmental monster being unleashed.

This is not to say I support National. I do not. But National is not as far on board with climate policy as people would like to think and this is showing in the announcements being made by its leader Simon Bridges. It is showing in the rhetoric coming from some Members of Parliament like Matt King who believes that the whole thing is a green conspiracy. Farmers who make substantial contributions to the economy through dairy, meat and wool product are largely National supporters. National is not going to come on board without some concessions regarding economic growth, which I believe would probably include slowing down the timetable for phasing out emissions. There will be concessions on transport and/or farming and/or industrial emissions.

But this is not to say that all is lost and that we should give up now. We should not – I have long said that even if one is not entirely convinced about climate change, there are enough other environmental problems being caused by the huge resource consumption that we need to act now.

There are areas though that we can invest in which might help to persuade National Party voters to consider putting before their M.P.’s:

  1. Hybrid vehicles have a future – rather than ban petrol vehicles outright and possibly provoke a resurgence of the far right in New Zealand politics, lets phase out anything over say 15 years old
  2. Introduce a common standard of biofuel for vehicles – the investment and research that would be needed would be a potentially substantial job creation exercise in its own right
  3. Help the building industry explore things like hemp crete, which absorbs carbon
  4. Help airlines such as Air New Zealand research biofuel development – Air New Zealand has already started, but it might need a helping hand
  5. Allow businesses that put solar panels on their buildings to keep any savings in power tax free
  6. Put bulk goods on rail – milk from dairy plants, petroleum and so forth

For New Zealand to address climate change successfully we need National on board. Without National on board, New Zealand’s efforts at addressing climate change will fail.