Where there is no vision

Each year, as a disillusioned voter (pondering being a non-voter, for the absence of credible options) I go to the effort of tracking down the conference speeches of the main party leaders.  What party leaders choose to emphasise, in one of their most-covered speeches of the year, can be telling.  As, of course, can what they choose to omit.  When Labour was in Opposition I never took very seriously talk (eg from Phil Twyford) about  fixing land use regulation and thus materially lowering the cost of housing because the leader never mentioned the issue, including in conference speeches (Jacinda Ardern still doesn’t, in conference speeches or elsewhere).  Of course, there are other speeches and interviews in the course of a year, but the conference speech isn’t just for geeks (see, eg Q&A interviews) or specialist audiences.  Things leaders care about, highlight, and spend reputational capital on tend to be things that get done.  Others things, not so much.

What, then, did Simon Bridges have to say in his conference speech on Sunday?  There was lots of rather sickly shtick –  his wonderful wife, his lively children etc.   And there was a rather strained attempt to suggest that somehow he’d overcome deprivation and disadvantage himself

Because it is the National Party that has shown that a young Ngāti Maniapoto boy from West Auckland, who talks like a boy from West Auckland, the son of a Baptist preacher and a teacher, can grow up to become the first Māori leader of a mainstream party in New Zealand, and the first Māori Prime Minister of our great country.

(I struggle to take seriously that sort of line because “son of Baptist preacher and a teacher” exactly describes me –  our fathers were ministers in suburban Auckland at the same time –  and I’ve never once felt any disadvantage.)

Perhaps he has conveniently forgotten that one of his recent predecessors –  Don Brash –  was the son of a Presbyterian “preacher” and of a mother who left school before high school, or that the first National Party Prime Minister was the grandson of a Yorkshire farm labourer. Or, frankly, that as far as I can see not a single Labour or National Prime Minister has come from any economically-privileged background.  Perhaps there are people in politics born with the silver spoon in their mouth –  the National Party president most notably at present – but that hasn’t been the background of any modern Prime Minister (or major party leader).

There are even some things in the speech that did resonate with me, including many of his criticisms of the current government.  But the centrepiece was, of course, cancer care.  I don’t have a view on the substantive merits of the specific initiative National is proposing, which looks like smart tactical politics, but perhaps rather small beer.   I’m inclined to think health is underfunded (there is a chart and some thoughts in this pre-election post, and the Budget estimate of health spending of 6.1 per cent of GDP this year is pretty much in line with what Labour was envisaging then) even on the basis of our current economic performance) but that wasn’t really his case.

But, for all the almost ritualised mentions in Simon Bridges’s speech of the importance of a strong economy (even the Prime Minister mouths those sorts of line from time to time), there was nothing –  not a word –  to suggest that he recognises that the biggest obstacle to higher material living standards (whether in the form of cancer care or other public or private goods and services) is the woeful productivity record that successive governments –  led only by National and Labour –  have presided over.    There is plenty of talk about cyclical issues, but nothing about the structural failures, and nothing about what National might do that would conceivably make a real difference in reversing that performance.

Sure, it wasn’t primarily a speech about economics, but there has been nothing from Bridges or his colleagues elsewhere, and no hint of a recognition here, that much-improved productivity performance is the only sustainable path to much better material living standards.  And not a hint of a recognition that these failures were already well apparent in the government in which he served (latterly as Minister of Economic Development) –  and if you think politicians never make such acknowledgements then (and in fairness to Bridges) I should point out that in his brief speech at the start of the conference he did acknowledge that National hadn’t done that well on housing (“but we weren’t Phil Twyford”).

What do I have in mind.  Well, of course, there is the shrinking – sideways at best –  share of foreign trade (exports and imports) in GDP, even though successful economies –  ones catching up on the leaders – are almost always marked by a rising foreign trade share.

ex and im

But the simplest starkest chart is the one showing labour productivity growth (or lack of it).

GDP phw mar 19

No labour productivity growth at all for four years now, and barely any for seven or eight (perhaps 1 per cent total growth since 2011/12).     Mediocre or worse as I think the current government is, these failures –  stark even in international comparison (and this isn’t a great decade for global productivity growth) didn’t start with Ardern and Robertson.   Now, sure, National people like to quote growth in per capita GDP but (a) even that was much lower over National’s term than in the previous nine years (lower again now) and (b) to the extent it was respectable for several years this decade, that mostly had to do with reabsorbing workers displaced in the last recession (the unemployment rate falling from about 6.5 per cent to about 4.7 per cent when National left office).  To repeat, as the chart illustrates, there has been barely any productivity growth, and although the unemployment rate probably should be pushed lower (see Reserve Bank underperformance), it is only productivity growth that will underpin sustained growth in material living standards.

National is promising a discussion document on economic policy later in the year.  I’ll look forward to that, and will study it carefully, but at present there is nothing in what they are saying –  and nothing in the Bridges speech –  suggesting that they really envisage anything different from what they did in the previous nine years, the period in which the structural economic indicators languished, even as a pretty muted cyclical recovery was playing itself out.     Some of the specifics Bridges mentions may even make some sense, but (individually or collectively) they aren’t the stuff of a transformational lift in economic performance, of the sort New Zealand –  including our ability to fund cancer treatments –  really needs.  It isn’t clear National has such a vision, let alone any real ideas about how to bring such a transformation about.

Sadly, of course, that does not mark them out from the current government, where we regularly hear about building a more “productive and sustainable” economy, but see nothing specific that might make a credible and useful substantial difference.

13 thoughts on “Where there is no vision

    • With a million NZ citizens living outside of NZ then this group will likely vote for fewer hospitals and less infrastructure spending in NZ and for NZ taxes to be paid to them to live outside of NZ.

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      • Not a bad idea; because anyone who recommends a qualitity and quantity review of current immigration policy is shouted down as xenophobic the only solution getting a reasonable NZ population plan is to bribe Kiwis to move overseas. My adult children who have reasonable jobs but no hope of purchasing homes in Auckland might be willing to move to Australia if they were offered say $100,000 each. This policy could be cheaper than the never ending building of apartments, roads, sewers, schools, etc and the $2 billion paid in accommodation allowances..

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      • Bob, are you suggesting leaving old folk to drool and dirty themselves crawling on floors as their key motor functions start to fail as we pay to have the young folk to stay outside of NZ?

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  1. Not sure that good politicians always expound on what is nearest their heart. Some policy decisions are radical not adjustments so for example a politician can be determined to move Ports of Auckland out of Auckland but if they were to publicly say so before an election all manner of vested interests will start lobbying against them and making donations to opposing parties (Gladtone said something similar about being defeated by publicans when he proposed legislation that introduced standard measures and prevented salt being added to beer).
    However what isn’t discussed can be significant. I attended a public meeting for the Labour party in Birkenhead just before Andrew Little stepped aside – both he and Jacinda spoke and covered many issues but neither mentioned the then published Labour party policy to get some control over immigration and to stamp out the many rorts related to low-wage immigration. This was a great pity since Birkenhead/Highbury could be a poster child for the positive benefits of diversity as well as being the location for two publicised convictions for businesses exploiting workers (one was a popular local Indian restaurant that had been paying immigrants less than $3 per hour for over 60 hour weeks). I deduced that a serious policy or even a discussion for planning NZ’s population would not result from their election. A point that was made yesterday by the head of the Māori Council, Matthew Tukaki and for that he was accused of “”xenophobic dog whistle””.

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    • Fair comments, but in this case I’d have been quite content with even hints of a narrative framework (recognisng the nature of the problem, and even hinting that doing the same stuff over again isn’t likely to produce a decent result).

      On Labour and immigration, you may not have been reading me back then, but even on the words they did say nothing v marked was ever likely to happen (but they cleverly tried to create a bit of an impression otherwise, at least while Little was in charge).
      https://croakingcassandra.com/2017/06/13/two-sides-of-the-same-coin/

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      • Jehan Casinader NZ first born of Sri Lankan parents attempting to give Māori Councillor Matthew Tukaki a history lesson on Maori history

        As a youngster I lived near Ihumātao. Spent many days playing around there and swimming at the beach. Don’t ever recall seeing any Maori around there keeping the land warm

        This has all the same hallmarks as Trump telling the “squad” to go back and fix the backyard from whence they came first before fixing their new environment

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      • Well Jehan Casinader was born here so may well be considered more Kiwi than an immigrant like myself who spent three quarters of my life living elsewhere. However his comments were about the past while Matthew Tukaki was talking about now and planning for the future. Many of his remarks struck a chord with me.
        It is all very well for Jehan Casinader to complain about houses that hadn’t been built in the past but I can clearly remember projections for Auckland’s growth being under-estimates and immigration numbers being higher than projected so for once we cannot blame short sighted planning. However fond Jehan is of immigration it would still be sensible to slow down until infrastructure catches up.
        Setting a rational/sensible quota for number of immigrants would result in a drop in house prices and I suspect that is the one reason all parties and most of the media avoid the subject. A significant drop in house prices would undo my millionaire status but on the other hand be a significant bonus for all my adult children.

        Quote from Matthew Tukaki: “”Let’s have an honest conversation about what the population looks like and to reasonably ask the question – if we can’t afford to house current New Zealanders, if we can’t afford the current health system, if we can’t afford food for our children and all these other things, why are we increasingly bringing even more people in?”” He would get my vote.

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      • Our productivity problems really started when our NZ economists told the government that Think Big on Dairy and farming was a higher productivity economic activity compared to the Muldoon Think Big projects which were wrongly considered a disaster. Unfortunately our NZ economists can’t do maths and negligently forgot to count the 10 million cows, that eat and require land and water resources to the tune of 200 million people, in their productivity calculations.

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  2. There are about 15 months and another National Party conference between now and the next general election. Your criticism would be entirely valid of Bridges’ speech had been had been made in 12 months time. Oppositions need to properly formulate their ideas for policy and keep them quiet until they can be publicised at the most advantageous moment.

    Like you I know that we must improve productivity and the level of exports but specific proposals in these areas, like many other policy ideas will be revealed next year. If there is nothing on productivity or exports then your criticism will be entirely valid, and timely.

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    • I’d agree if the issue was specifics. My concern at this stage is like of any sense of a narrative framework that recognises the significance of the issue. If the Nats were serious about productivity they would need to be begining to reframe the conversation and recognise that things weren’t going well even when they were in office.
      (They do have a few specifics in the speech, mostly a reversal of bad stuff Labour has done)

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      • I cannot see why any political party would be against either increasing productivity or increasing exports. Obviously changes must be difficult but would they be unpopular? Surely now is the time to try to make a clear case for why the other parties cannot tackle them as effectively. So putting on an ill-fitting ‘National party hat’ I would be emphasizing increasing size and costs of the public service, heavy costs subsidizing tertiary education in non-productive study areas (how many professionally qualified animators can NZ support etc), any climate change policies that are both ill-considered and ineffective.
        Giving it more than a few seconds thought I’m sure I could produce better and surely I could find similar arguments but from a Labour party point of view. What matters is that these common political discussion points are linked back to productivity and exports.
        In other words I agree with you. Both major parties have lost focus on what actually matters.

        Liked by 2 people

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