Unfit to govern

I’m probably the sort of person the National Party used to count on voting for them.   National was the only party I was ever a member of, the only party I ever canvassed for. There were family connections, and there were the founding principles, every one of which I identified with (and do still).   Even in Wellington, middle-aged conservatives might reasonably have been assumed to support National, even if (at times) through gritted teeth.  One of those founding principles talked, perhaps slightly quaintly, of “countering Communism”, and it seemed to be something taken fairly seriously throughout the post-war decades.  There was a suggestion of some values; a suggestion of things that mattered beyond just the next business deal.  Friends and allies, people and countries with whom we shared those values, seemed to count too.

But over the last couple of decades, New Zealand political figures, and the National Party ones in particular, seem to have binned any sense of decency, integrity, or values when it comes to Chinese Communist Party ruled China. I don’t suppose that individually most of them have much sympathy for PRC policies and practices, but they just show no sign of caring any longer.  Deals, donations, and indifference seem to be the order of the day.

Over the last couple of years the depths the party, its leaders and MPs, have been plumbing have become more visible.  In 2017, in government, they signed up to a Memorandum of Understanding with the PRC on the Belt and Road Initiative.  In that document they –  Simon Bridges as signatory –  committed to “promote” the “fusion of civilisations”.      Plenty of people will probably dismiss such statements as “meaningless”, the stuff of official communiques.  But decent people –  under no duress whatever –  don’t sign up to things suggesting that today’s equivalent of Nazi-ruled Germany is a normal and decent regime.  Of course, they would probably dispute the parallel, but that’s just willed deliberate blindness.

Later that same year we learned that the National Party had had a former PLA intelligence officer, Communist Party member, sitting in their parliamentary caucus.  It seems to be generally accepted that Jian Yang, of such a questionable background, is one of the party’s largest fundraisers.   Presumably the leaders (Key and Goodfellow) were aware of his past, but lets be generous and assume that most of the caucus was as unaware as the public.    But for the past 18 months, everyone has known.    They also know –  because Jian Yang acknowledged as much –  that he deliberately misrepresented his past to get into New Zealand, telling us that Beijing had told him (and others in his position) to do so.   Breathtakingly, there is no sign that official agencies in New Zealand have done anything about those admissions, but National is now out of office so I guess one can’t blame them for that.

But what the National Party –  leader, president, MPs, and all those holding office in the party –  is responsible for is the fact that Jian Yang still sits in Parliament, still sits in the National caucus, is still National’s spokesman (on a couple of minor portfolis), with the express support of successive leaders, and (apparently) in ongoing business relationships with the party president (he who trots of to Beijing to praise the regime and its leader).   And not one MP, not one national councillor, no other officeholder –  not one –  has broken ranks, and been willing to openly question (or deplore) just what has gone on.  Doing so might, I suppose, jeopardise their individual futures.  But values are the things you are willing to risk for, to pay some price for.    Rumour hath it that some people within the party aren’t entirely comfortable, but so what, if you aren’t willing to do, or say, anything?

A few months ago we had the egregious former Minister of Trade, and foreign affairs spokesperson, Todd McClay plumbing new depths.    In an interview with Stuff, he championed the PRC regime interpretation of the mass internment of Uighurs in Xinjiang, noting that

“the existence and purpose of vocational training centres is a domestic matter for the Chinese Government.”

If he’d just kept quiet at least there might have been some doubt about his decency, but he opened his mouth and left no doubt.  He was spinning for the CCP regime in Beijing.

Since then even the regime in Beijing has more or less admitted that, of course, that line isn’t true.  But we’ve heard nothing more –  and certainly no apology –  from Mr McClay or his leaders.

And, of course, every so often the National Party leader Simon Bridges pops up if there is ever the slightest sign that anyone in the current government is expressing even the mildest reservations about the regime in Beijing.  Never mind that the Defence strategy document stated no more (considerably less) than was obvious to blind Freddy, it was too much for Mr Bridges.  Never mind that reservations about Huawei seem to be increasingly widely shared by governments and intelligence agencies across the western world, it might lead to furrowed brows and discontent in Beijing, and we couldn’t have that could we?   Never mind too that, in government and in practice it is hard to conceive that things would have been any different on that particular score under National –  I don’t suppose even National is quite so far gone in Beijing’s thrall that they would simply walk away from Australia, the United States, a growing number of other western countries, and what appears to be assessments of our own intelligence services.    No sense at all in anything Bridges –  or any other National Party figure – says that the PRC itself has changed: bad as the regime always was, it has now become worse.

But it was comments the other day from National’s third-ranked member and finance spokesperson, Amy Adams, that really left me open-mouthed in astonishment.  Both at what she said –  even if it wasn’t far from what had seemed to be the National stance in practice –  but also at the lack of any other coverage of, or follow-up to, those remarks.    In an interview with NBR, (behind a paywall but here) we are told

National’s finance spokeswoman Amy Adams has accused the government of putting the economy at risk by offending China.

“The first thing is you don’t p[…] off your major trading partner and, let’s be really clear about this, China is our single biggest trading partner.”

Quite extraordinary.

One could clear the small things out the way first. For example, governments don’t trade with China, firms in New Zealand trade with firms in the PRC.  Sure, governments set some of the terms on which that trade occurs, but government isn’t a business.

One might also note that if the PRC is the largest “trading partner” for New Zealand firms, it is very similar in size to Australia in terms of total New Zealand trade.  Until about five years ago, the EU in total accounted for more of New Zealand’s trade than the PRC.  Australia remains by far the largest source of foreign investment in New Zealand.     And these days exports to each of our largest “trading partners” –  in an economy (New Zealand) that doesn’t trade much with the rest of world by international standards – account for about 5 per cent of  GDP, in total.  For many decades, a much larger proportion of our GDP was accounted for by trade with the UK.

Oh, and a large proportion of New Zealand exports (not all of course) are commodities, and if not sold in one market they will be sold in some other part of the global market.   PRC babies seem unlikely to stop drinking infant formula.

But what really staggered me was the bald sense in which National’s finance spokesperson appears to think that the interests and priorities of foreign governments are what should matter most to our government. Not our values, not our people.  On her telling, we’d never annoy Australia about anything (apple import cases to the WTO, illegal migrants on Nauru, New Zealand citizens being deported from Australia).    We’d never have taken on France over nuclear-testing (at a time when the UK was entering the EU, and trade access to our largest market was substantially in danger).  We’d never have fought for Imperial Preference for our exports to the UK in the 1930s.  We’d never have banned nuclear ships (the US wasn’t our largest trading partner, but the US and EU together were hugely important markets, and we relied on the UK government (Thatcher) to fight our corner for EU market access.   And more generally –  and much more dominant – Canada would never ever stand for itself on anything that involved the United States, or Ireland vis-a-vis the UK.  I suspect Denmark and the Netherlands had had significant trade ties to Germany pre-1940, but they didn’t exactly put out the welcome mat to Hitler.  Southern African countries chose to limit trade with Rhodesia, and confront South Africa, because they considered they had a just cause.  And so on.    (Note that I’m not endorsing all these causes, just noting the willingness of governments to upset their closest “trading partner”.)

Of course, this almost certainly isn’t what Ms Adams believes at all.   Presumably as a senior minister she had no problem at all with the fact that at times we had, and have, open differences with Australia.  In any relationship, no matter how important, there are going to be differences from time to time, and in international relations governments (at least democratic ones) aren’t supposed to act for themselves, or even for small favoured groups, but for the citizenry as a whole.

Instead, the Adams approach –  presumably endorsed by her leader –  is about a particular thuggish regime. It seems to be that we should defer entirely to Beijing’s prickly style and never ever do or say anything that might upset them, never display any self-respect, and simply engage in either anticipatory compliance or abject penitent submission.  Worse, apparently we should even make excuses for them –  or retail their propaganda lines, as per Todd McClay.  It is classic domestic abuse situation, and yet championed by someone who aspires to be a senior minister of a free country, perhaps even aspires to be the Prime Minister.   In fact, someone who was the Minister of Justice, who led legislative attempts to respond to the family violence problems.  I’m quite sure it wasn’t her advice to victims –  “oh, don’t upset him…ever”.    So why does she propose that our foreign policy towards the international abuser par excellence be essentially just that?  Act that way and all you do is encourage the abuser, and lock yourself further into the cycle of abuse, humiliation and loss of any sort of self-respect.

Of course, the difference here is that Adams ask us (citizens) to bear the abuse and humiliation –  leaders who remain silent in the face of evil, leaders who won’t stand up for the integrity of the system, and even spend our money to run PR-front organisations to champion the pro-Beijing perspective –  all to benefit a few specific businesses that have (consciously and knowingly) over-exposed themselves to a thuggish regime, and the substantial flow of donations to their own political parties.    Politicians like Adams simply encourage the over-exposure, and encourage the false subservience of victimhood.   If our businesses were dealing with organised crime, or with shonky people who didn’t pay their bills, we’d either insist or encourage them to cut their exposures.  If you deal with the Mafia you are on your own –  in fact, society will shun you, not tolerate you asking for us to pander to the leaders.  But when it is the PRC –  organised coercive threat if ever there was such –  our leaders simply want us to defer, and complain when their opponents show any sign of not being quite deferential enough to the bully.  And they simply let evil pass by, and in so doing make themselves complicit with –  and thus partly responsible themselves –  for the evil.

In his Beijing-deferential interview on the Herald website the other day, David Mahon tried to frame the current PRC upset with New Zealand as “the Chinese see it as akin to infidelity”.    What a sickening image, but perhaps one that brings us right around to the abused-spouse parallel.  New Zealanders made no vows to Beijing – although perhaps our craven political leaders did –  but when the merest squeaks are heard, the abuser – freshly drunk on newfound power – seems to feel free to attempt to squash and silence, while politicians, lobby groups and business interests cheer on not the abused “spouse” but the abuser.   New Zealand “leaders ” have been among the most sycophantic and compliant anywhere in the western world, so perhaps there is a sense that they can’t afford to let us get away with some renewed self-respect.  That, after all, might encourage others to think and act for themselves, for the values of their peoples.   Better to foster the illusion –  assisted by local politicians and academics –  that the PRC holds our prosperity in its hand.

It simply doesn’t. It never did.

But that’s New Zealand politics, that seems to be today’s National Party. It is sickening.

 

 

“This country has prospered over the past decade, while other economies have suffered”

Or not.

The title to this post was taken from the latest column from veteran political journalist Barry Soper.  Apparently he had had some readers get in touch, not entirely convinced by his PRC-related articles earlier in the week.

They all ignore the fact that this country has prospered over the past decade, while other economies have suffered.

The Key Government’s management of the global financial crisis has been lauded but without the free trade agreement, signed in the Chinese capital as the final act of the Clark Government, this country wouldn’t be where it is today.

The puerile keyboard warriors’ bile is too vile to repeat but it seems to be based on envy, that the Chinese, after generations of deprivation, have shown the world they can compete and are a force to be reckoned with.

I’m not sure quite what he bases these assertions on (although it is the sort of line that less well-grounded champions of Beijing, including former Foreign Minister, Murray McCully, have repeatedly tried to run).  “Be grateful, peasants” seems to be the tone, for the CCP in Beijing has graciously bestowed its bounty upon you.

I don’t want to waste much time on the alleged PRC success story.    When you do so much damage to yourself, and then stop the self-destruction, of course you’ve got plenty of ground to make-up, and with half-decent policies you can do some of that quite quickly.   Here are the latest Conference Board productivity estimates.

China GDP phw feb 19

The PRC……not even half the levels of Korea or (decades of underperformance) New Zealand, not a third of Taiwan or a quarter of Singapore.     Who could possibly envy that sort of performance?  There was no obvious reason why China could not have matched the performance of Korea, Japan, or Taiwan.  Except that they chose to adopt, and continue to run, a system that consistently produces poor economic results.

But what I was really interested in was the assertion that New Zealand has had a really good economic performance over the last decade “while other economies have suffered”.  I guess if Greece, or even Italy, is your benchmark it isn’t too far wrong.  But then almost everyone does better than those troubled euro-crippled economies.

One comparison I like, and which I’ve run before, is between New Zealand and the United States.   Were there anything to the “we owe such a debt to Beijing, and have done so well ourselves” story, an obvious place to look might be a comparison with the United States.  After all, the US was the epicentre of the financial crisis itself, their central bank got to the limits of what it could do, and no one thinks Beijing someone “saved” the US.   And yet here is how real GDP per capita compares across the two countries since late 2007, when the last recession began.

US and NZ comparison GDP

We’ve mostly done very slightly better than the US over the decade or so, but there really isn’t much in it.   Certainly not a case of the US suffering and us “prospering”, whether thanks to Beijing or any other cause.

And to the extent we’ve done a touch better, it certainly isn’t reflecting stronger productivity growth.  The data are indexed to 100 in 2007.

US nz productivity

It isn’t just an us versus the US comparison either.  Over that decade, real GDP per hour worked rose by 4.4 per cent, but in the median OECD country productivity growth was 8.9 per cent.

And if Beijing and the (so-called) free trade agreement were the source of any special New Zealand prosperity, exports might be an obvious place to look.  Except that over the previous decade New Zealand exports actually fell a little as a share of GDP.  In the United States, and in all but a handful of other OECD countries, exports became a larger share of the economy.

Even on more purely cyclical measures, New Zealand still doesn’t stand out (at least on the good side).  The unemployment, for example, has come down a long way, but it is still quite a bit above the lows reached before the recession (at a time when demographics will be tending to lower the “natural” rate of unemployment).    In the United States, by contrast, the unemployment rate is below pre-recession levels. That is also true across the G7 as a whole, the EU as a whole, and the OECD as a whole (individual bad euro-area countries notwithstanding).

And if you don’t like the idea of comparing against the US –  even though it was the centre of crisis, and doesn’t owe anything in particular to Beijing –  here is how we’ve done against another group of countries, each now with productivity levels similar to those in New Zealand (and few doing much trade with the PRC).   Since all these countries started (in 2007) with productivity well behind global frontiers, all should have been able to do okay even if productivity growth at the frontier (eg US and northwest Europe) slowed.

small countries

Many did pretty well.  As for us – Beijing (alleged) beneficence notwithstanding –  either worst or second worst depending on your preferred measure.

As I noted earlier on, there are countries that have done a great deal worse than us.   But the suggestion that we have “prospered” over the last decade –  in some way materially outstripping the rest of the advanced world –  isn’t just a myth. It is worse than that.   And the people who run the story, whether as senior journalists or senior politicians should know better.

Countries mostly make their own prosperity.  We once did –  those decades when we really did lead the world.    We could again, although that might involve facing facts.  But these days politicians and their acolytes in the media seem more interested in playing distraction; in this case continuing to corrupt our system, supported by motivated fantasy stories about our (alleged) success and our (alleged) debt to Beijing.

 

Challenges and complexities

Interviewed on Radio New Zealand this morning, the Prime Minister conceded that there were “challenges and complexities” in the government’s relationship with the People’s Republic of China.    Fearful, and seemingly out of her depth, she wouldn’t or couldn’t identify any of those “challenges and complexities”.   And yet she is criticised for not doing enough to keep in Beijing’s good graces by the person in New Zealand politics with an even worse record on PRC issues –  Simon Bridges, leader of the National Party.

I don’t have anything much to say about the Air New Zealand story, or any particular reason to doubt the slowly-emerging explanation (which itself seems to have a PRC-coercion dimension, dating back to last year’s PRC insistence that airlines not suggest that Taiwan –  an independent democratic country –  was in fact or in any way not part of the PRC).  It is just that were the true story to have been more worrying, it isn’t clear that Air New Zealand would have much incentive to be straight with customers or the public: they have an ongoing business to run and Beijing relations to keep smooth (and, of course, the chief executive is the chair of the PM’s Business Advisory Council).    But perhaps leaks from within Air New Zealand would mean the truth still got out?

What of the two Barry Soper stories (this one from the front page of the Herald, and this opinion piece)?   The first is introduced this way

Diplomatic links with China appear to have plummeted to a new low as Prime Minister Jacinda Ardern is given the cold shoulder by Beijing and a major tourism promotion is postponed by the superpower.

Of the visit to Beijing, we learned this yesterday

Ardern confirmed she had an invitation from the Chinese administration to meet President Xi Jinping, but the problem was finding a suitable date. She was meant to meet with the President at the end of last year.

She wouldn’t say whether or not she was confident the meeting would take place this year.

In other words, she isn’t confident it will happen at all.   What is hard to understand is why any self-respecting person would put themselves through this rigmarole?   Abasement before the emperor, and all for the sake of a few New Zealand businesses (often taxpayer subsidised ones) that have got themselves too exposed to a country with a noxious regime.   She keeps telling us we are an independent sovereign state, not some tributary regime.  Why can’t she just politely walk away (and get some aide to make her a note of how constructive and useful  –  enhancing to their reputations –  foreign leaders meetings with Adolf Hitler were).    Perhaps late last year the “scheduling” excuse –  “we all have busy calendars” –  might have washed with some.  It clearly doesn’t now.  And that shouldn’t worry New Zealanders.  It shouldn’t be a cause for reproach from an Opposition leader who (a) has never distanced himself from his foreign affairs spokesperson’s defence of the PRC concentration camps in Xinjiang, and (b) who retains in his caucus, and expresses support for, a Chinese Communist Party member and former PLA intelligence official, and who (c) is understood to rely on that member as one of his largest party fundraisers.  That is where the focus should be, not on selling our souls for a meeting with Xi Jinping.

And then there is the year of the Chinese tourist,

The 2019 China-New Zealand Year of Tourism was meant to be launched with great fanfare at Wellington’s Te Papa museum next week, but that has been postponed by China.

Industry people and regime-sycophants had been very keen on this exercise.  The Contemporary China Research Centre –  funded partly MFAT, chaired by a New Zealander with a significant role in the global Confucius Institute movement – was even hosting a conference on it late last year.   But this isn’t some sort of normal country.  What Beijing giveth, Beijing can also take away.  We are told

Richard Davies, manager of tourism policy at the Ministry of Business, Innovation and Employment, said: “China has advised that this event has had to be postponed due to changes of schedule on the Chinese side.”

Officials are now working with China to reschedule the opening.

Believe all that and you’ll believe anything.  But the Prime Minister claimed to believe it, telling her RNZ interviewer that she could only go on what she’d been told, and she’d been told there was a scheduling problem.  I’m sure she doesn’t really believe it, but why can’t she come straight with the New Zealand public?   She is supposed to serve us, not a small group of business interests.    Better to take explicit credit for a slightly more distant relationship with one of the most appalling regimes on the planet.  Especially if all that talk about kindness and empathy means anything at all.  But she won’t do that –  won’t square with the public about the nature of the regime she (and his predecessors) have been pandering too, all no doubt on official advice.

You got a sense of the sort of business sector pressure she seems to be under in how she responded to the interviewer’s questions about Huawei.  Much as the China-oriented bits of the business community – and the China Council –  must hate it, almost everything that has emerged on Huawei in the last couple of months only confirms how unwise any decent and self-respecting country would be to allow Hauwei equipment to play a key role in 5G networks.   And yet the Prime Minister seemed to interpret the question as a suggestion that we should back down and just let Hauwei –  and the PRC state –  do its thing.  ‘If we did that could we really say we had an independent foreign policy?” was the gist of her response.

Barry Soper seems to be championing some of that sort of “never mind national security, never mind self-respect, never mind the advice of longstanding friends and allies, lets never ever upset Beijing” line.  It was clear in his selection of people to quote from in his article.  There was this, apparently on Huawei

Asset management and corporate adviser David Mahon, based in Beijing, said governments needed to get over thwarting Chinese economic aims in a way reminiscent of the Cold War struggle between capitalism and communism. “It’s unhelpful for politicians and a few anti-Chinese professors to feed uncorroborated McCarthyite conspiracies about Chinese spy networks in their countries and targeting anyone who doesn’t share their view,” Mahon said.

Just lie back and let Beijing have its way seems to be Mahon’s perspective.  That isn’t how self-respecting people, or nations, act.  But perhaps if you are just desperate for the next deal none of that stuff matters?

And then there was more melodramatic stuff from Philip Burdon, until recently chair of the taxpayer-funded PR outfit the Asia New Zealand Foundation, and of course a longserving senior National Party figure.

Philip Burdon,….said New Zealand couldn’t afford to take sides.

“We clearly need to commit ourselves to the cause of trade liberalisation and the integration of the global economy while respectfully and realistically acknowledging China’s entitlement to a comprehensive and responsible strategic and economic engagement in the region,” he said.

Sources in Beijing say China plans trade retaliation…..

Two-way trade with China trebled over the past decade to $27 billion. “The implications for New Zealand are dangerous at every level,” Burdon said.

Wouldn’t it be nice if the PRC seriously committed itself to the practice of liberalisation?  Doesn’t seem likely.  And “respectfully acknowledge their entitlement”?  Like true vassals?

But what’s with this “can’t afford to take sides” business?  It has been a convenient framing for some time, as if we are asked to choose between the US and the PRC.  Even if that were the choice, the United States (for all its faults) remains much more in tune with the values and attitudes of New Zealanders than the lawless regime in Beijing does.  But, of course, the choice isn’t really between the US and the PRC, but between the PRC and New Zealand, or even (charitably) the interests of a small number of New Zealand businesses (and parties reliant on donations) and New Zealand as a whole.   Given that choice, we can’t afford our governments not to take sides, not to back New Zealand and its values and long-term interests.   That includes defending the integrity of our political system, defending the freedoms of ethnic Chinese New Zealanders (whose media and community associations seem to have been largely taken over by Beijing-affiliated groups), and being the sort of nation that stands up internationally for the sort of behaviour –  treatment of other people –  we expect.

There is more from Philip Burdon in Barry Soper’s op-ed

We can’t afford to let this diplomatic tightrope slacken and that’s most certainly the view of a Peters confidante, former Trade Minister in the Bolger Government and recently the chair of Asia 2000 Phillip Burdon.

The mushroom magnate says China has constructively sought to engage with New Zealand for which we should be grateful.

It’s utterly ridiculous, Burdon contends, that China has sinister plans to subvert and interfere in our society or in our democratic institutions.

Ah, it is a debt of gratitude –  perhaps serviced with periodic offerings of tribute –  that we owe to Beijing, at least according to Burdon, for all that “constructive engagement”.     What exactly was that?

As for Burdon’s final sentence, one presumes he is so far down the track of abandoning all sense of self-respect that the presence of a former PLA intelligence official, who hob-nobs with the embassy and never ever says anything critical of Beijing just doesn’t bother Philip Burdon.  There are deals I guess, and never mind the integrity of our system.  Perhaps it doesn’t bother him that Parliament’s justice committee is chaired by someone with close ties to various United Front institutions?  It should.       It isn’t necessarily that Beijing “has” sinister plans –  as if this is something in the future. The very fact that Jian Yang in particular still sits in Parliament, challenged by no one in the entire political spectrum tells you that, by accident or design, those visions have already been coming to pass.  Or when neither the Prime Minister nor the Opposition leader will make a clear stand in defence of Anne-Marie Brady and her work.

I’m sure Beijing has no interest in toppling our formal institutions.  Why would they when those institutions have rotted from the inside.  I guess he too wants us to believe that only a “few anti-Chinese professors” are at all bothered.

All of which brings us back to the opening line of Barry Soper’s op-ed

New Zealand is feeling the heat of the Chinese dragon’s breath and if we’re not careful it could incinerate us.

Which is simply nonsense.    As an economy, we have much more to worry about from a sharp Chinese economic slowdown –  which may be underway already –  than from any sorts of specific attempts at economic coercion of New Zealand.  The PRC is a big country, and in a world with few buffers a recession there could matter a lot everywhere.   As for New Zealand, the PRC certainly has some capacity to harm some specific sectors, perhaps even quite severely.  I wouldn’t want to be a university vice-chancellor if the PRC decides to attempt to bring the government to heel. Then again, I don’t have any sympathy with those people, who have put themselves at the mercy of a known thug, all backed by dodgy immigration provisions, rather than looking to manage their exposures (as prudent businesses, unable to twist governments to their purposes, would).  I have some more sympathy for tourism operators –  who mostly are operating in an open market.  As for commodity exporters, well they are selling commodities and (to a first approximation) what isn’t sold in the PRC will be sold somewhere else.   Sometimes values and interests cost – in many ways, the only true measure of what is valuable is the price one is willing to pay to defend it.  Too many of these Beijing defenders don’t seem to have any particular interest in defending our system, our people –  let alone standing against the sheer awfulness of the PRC regime at home and abroad.

We can’t fix the PRC gross human rights abuses.  I’m not even suggesting we should be at the forefront of moves on those issues. But when other countries speak and our governments don’t, they shame us.   Neither our Prime Minister nor our Opposition leader will utter a word about (for example) Xinjiang, or about the abducted Canadians, even when other countries have –  otherwise reprehensible Turkey only this week in a strong statement on Xinjiang. Life – politics –  has to be more than just deals and donations if it is to have any meaning, command any respect.   Frankly, it is hard to tell at present which side of politics is worse on this issue, but on balance I’d have to give it to National –  whose only interest in all of this, in anything they say in public, seems to be placating Beijing.  In office there are hard choices and calls to make –  even if that is still no excuse for not openly engaging on the “challenges and complexities”.  In Opposition one might have hoped, just occasionally, for a slightly more principled position. But I guess their actions, their people, their words reveal what their “principles” really are in this area.

 

 

Donations, the PRC etc

There was interesting Herald story a couple of weeks ago suggesting that the National Party may be beginning to feel some heat about their affiliations with, and excuses for, and funds flowing from, the People’s Republic of China (or people with close associations thereto).    The story drew on a speech given by National’s spokesman on electoral law, longserving MP Nick Smith,  to the Nelson Rotary Clubs.  In that speech Nick Smith argued as follows

4.2 Banning Foreign Donations

The second change I want to promote is a ban on foreign donations. This proposal was floated by former Attorney General and SIS Minister Chris Finlayson in his valedictory speech last month with him forcefully arguing that New Zealand’s democracy is ours and should not be open to manipulation by any foreign influence. This risk has been highlighted in recent overseas elections.

The existing electoral law does put limits on foreign donors, but needs strengthening. Only kiwi citizens and residents should be able to donate to political parties or to campaigns that seek to influence an election outcome.

Such a change would need to be done with finesse so as not to discourage political participation by new New Zealanders. The issue is not about ethnicity. It is about New Zealand not allowing its democracy to be inappropriately influenced by overseas interests.

It isn’t that I disagree with Nick Smith on this specific, just that in raising it (and not other issues around electoral donations) he seems to be avoiding –  probably consciously and deliberately – some of the real specific issues that are apparent in New Zealand.

The Herald article summarised the current law this way

Current electoral law prohibits non-citizens or residents from donating more than $1500 to political parties, but these can be avoided by donating through New Zealand-registered corporate entities – such as companies, incorporated societies and trusts – which are allowed to donate regardless of whether they are owned or controlled by New Zealanders.

and in a recent commentary, Simon Chapple, director of Victoria University’s Institute for Governance and Policy Studies observed

Currently in New Zealand foreign donations to a party of up to NZ$1,500 are permissible. Moreover, foreign donations below this amount are not individually or collectively disclosed.

It would be easy for a foreign state or corporate body seeking political influence to channel a large number of donations into the system just under the threshold via numerous proxies. Whether such interference has been happening is unclear, since New Zealanders do not know how much money currently comes in to political parties via foreign actors.

Even if foreign donations are not a problem now, one could rapidly develop. A strong argument can be made that foreign money has no place in democracy, including New Zealand’s.

New Zealand would not be going out on an international limb by banning foreign donations. Foreign donations to political parties are not permissible in the [United Kingdom, Ireland and the United States. They are also banned in Canada but unfortunately a significant loophole exists. Australia is currently in the process of banning foreign donations.

And I’d certainly agree with Simon on that general point: foreign money should have no place in funding election campaigns or political parties.

So there probably is a good case for a blanket prohibition on donations (in cash or in kind) to political parties by non-resident non-citizens.  But that looks mostly like pre-emptively closing a possible source of a problem (although perhaps real in the case of Phil Goff’s last mayoral campaign) –  and thus looking as though you care –  when the real actual issues New Zealand faces in this area would not be addressed at all.   For example, the largest single (acknowledged) donation to the National Party a couple of years ago was from a New Zealand registered company owned and controlled by a PRC billionaire.  That is foreign money in New Zealand politics, and shouldn’t be allowed.  It would be bad enough if it were from donors in countries that generally shared New Zealand values and democratic norms.   It is far worse when the donor is from the PRC – or, if you like, North Korea, Equatorial Guinea or other repressive authoritarian states –  and (according to the media coverage) clearly in the good graces of Xi Jinping.   Personally, I would probably favour banning all corporate donations to political parties –  people are citizens, companies aren’t –  but at very least we should apply the same restrictions to foreign-controlled companies that we apply to non-resident non-citizen individual donations.

But laws can take you only so far, and I’m not convinced they can deal with what appears to be the rather bigger issue around New Zealand political party financing (probably mainly National, although it seems likely that Labour now in government will be seeking to get in on the act).   That requires decency, integrity, and a willingness to make a sacrifice –  in this case, not to take money from people –  not even New Zealand citizens or residents – with close associations with, declared support for, political regimes with values so inimical to, and inconsistent with, those that have underpinned New Zealand democracy, and its fairly free and open society.

It seems to be widely understood that National Party Jian Yang is the party’s biggest single fundraiser.  Jian Yang, as is now widely known, served in PLA overseas intelligence system and was (perhaps is) a CCP member, who eventually acknowledged that he misrepresented his past to get residency and citizenship in New Zealand. In all his years in Parliament he has never once criticised the PRC –  not even over Tiananmen Square (perhaps there is an opportunity for him on the 30th anniversary in a few months time) – he is observed to be very close to the PRC Embassy, and even a former diplomat (now a lobbyist, so hardly someone deliberately trying to stir up trouble) declared that he was always very careful what he said in front of Jian Yang.    It is, to put it mildly, hard to be confident that he is primarily serving the interests of New Zealand and New Zealanders.

I’ve noted previously comments made last year by serious senior people at a Chatham House rules event I was invited to

There was clear unease, from people in a good position to know, about the role of large donations to political parties from ethnic minority populations –  often from cultures without the political tradition here (in theory, if not always observed in practice in recent decades) that donations are not about purchasing influence.  One person observed that we had very much the same issues Australia was grappling with (although our formal laws are tighter than the Australian ones).  Of ethnic Chinese donations in particular, the description “truckloads” was used, with a sense that the situation is almost “inherently unhealthy”.   With membership numbers in political parties dropping, and political campaigning getting no less expensive, this ethnic contribution (and associated influence seeking) issue led several participants to note that they had come round to favouring serious consideration of state funding of political parties.

These will probably (almost) all be donations made by New Zealand citizens or residents, and nothing in what Nick Smith (or Chris Finlayson) was saying would even touch on them.

And thus late last year, Yikun Zhang sprang to brief public prominence, when Jami-Lee Ross revealed the tape-recording of his discussion with Simon Bridges about the $100000 donation(s), and the possible bid by one of Yikun Zhang’s associates for a place on National’s list.   I’m not mostly concerned with the question of whether this donation (or set of donations) was appropriately disclosed –  although in general I think there is a strong case for a lower, and more binding, disclosure threshold, tying all material donations back to identifiable natural persons –  but about the affiliations and identifications of Yikun Zhang and his associates.  We learned at the time the story broke that Yikun Zhang – despite being a long-time New Zealand resident (and citizen) doesn’t speak English.  We learned a lot about his involvement –  at senior levels –  in various United Front bodies, and the strong ties he appears to have with CCP entities back in the PRC.  It is, to put it mildly, hard for a dispassionate observer to be confident that he primarily has at heart the interests of New Zealand and New Zealanders.   Given the nature of the regime he enthusiastically and repeatedly assoicates with, no decent political party should voluntarily have any but the most formal relations with such a person, and certainly shouldn’t be soliciting money from, or through them.  It isn’t what decent people, with any regard for the integrity of our system, do.

In fact, of course, not only do they take his money, but Phil Goff, Jian Yang, and former National MP Eric Roy got together to nominate Yikun Zhang for an honour, something bestowed last year by the current government.  In effect, it appears, for services to one of the more evil –  most evil, judged by the numbers it rules –  regimes on the planet.

And of course we know that not just MPs but party officials seem to fall over themselves to praise that same regime, and run interference whenever there is a suggestion of problems (think of Todd McClay running Beijing propaganda lines about “vocational training camps in Xinjiang).  Peter Goodfellow, the National Party president, seems to work very closely with Jian Yang to pander to the regime, and keep the local donation flow going.  And on the Labour side, Nigel Haworth seemed to be little better.

So by all means, take up the specific suggestion to ban completely foreign donations.  It would be a small improvement on the current situation, but it would not even begin to tackle the deep corruption of the our political system around the PRC regime.  People who were long-serving senior ministers – Nick Smith and Chris Finlayson –  know that very well, even if they are genuinely well-meaning on their specific proposal.

But attempting to fool the public otherwise seems to be a bit of new theme.  That Herald story where I first saw reference to Nick Smith’s speech included this gem

In a related move, Parliament’s justice select committee have issued a rare invitation to the country’s intelligence agencies to give a – likely closed-doors and secret – briefing to MPs about “foreign interference” in local elections.

Nick Smith, a member of the committee and his party’s spokesperson for electoral law reform, confirmed the committee as a whole late last year sent a letter to the New Zealand Security and Intelligence Service (NZSIS) and Government Communications and Security Bureau (GCSB) inviting them to give evidence.

Smith yesterday said he hoped the NZSIS and GCSB would be able to provide insight on the local risks posed by issues such as the hacking the public officials’ communications, foreign donations, and anonymous and politicised social media campaigns.

“There is the issue of funding, and whether foreign governments are either directly, or indirectly through shelf companies, are using funds to inappropriately influence outcomes,” he said.

Smith said the invitation to the NZSIS and GCSB offered evidence to be given in secret if required. He conceded this would be an unusual move for usually-open committee meetings, but was justified: “I think this is a really important issue,” he said.

So a committee chaired by Raymond Huo, he of various United Front bodies, he who chose a slogan of Xi Jinping’s for Labour Chinese-language compaign in 2017, with a senior National MP promoting only the narrowest reform (while providing cover for Jian Yang) will invite the intelligence agencies to provide advice on foreign influence issues, but in secret.   Perhaps –  but only perhaps, because the fact of this hearing might be used to simply play distraction – it is marginally better than nothing, but we don’t need intelligence agencies to tell us there is an issue around the PRC. Both main parties know what they are doing –  who they associate with, who they take money from, who they honour, who they seek closer relations with, and who they refuse ever to criticise, no matter how egregious the regime’s abuses.  All the minor parties keep quiet and go along too.

There was column this week on Newsroom by political scientist Bryce Edwards argues that it is “urgent” that we start having a proper debate in New Zealand about the PRC and the relationship with New Zealand.   I don’t really disagree with him, although he seems to want an “elite” debate, and seems scared by the idea that the public might have a (strong) view (an “overly simplistic one” apparently, like ideas of good and evil perhaps?).

Edwards writes

Obviously, we can’t rely on the politicians to lead that [debate] – they’re too compromised, and they’re just too inclined to suppress the discussion. Instead it has to be other parts of the public sphere – especially the media and other public figures – that needs to step up to examine and discuss the issues.

But it seems like wishful thinking.  Sure there is the occasional voice from the margins –  whether Edwards or Anne-Marie Brady – but there doesn’t seem any sign that anyone in “elite New Zealand”, anyone who commands serious respect, is about to break ranks from the “keep quiet, keep the deals and donations flowing” sickening consensus of the last few decades.  Not former leading politicians, not church leaders, not leading business figures, no one.  Even if a few people mutter quietly –  even Fran O’Sullivan had some recent encouraging comments about donations – no one seriously breaks ranks.   The taxpayer even funds bodies that condemn taking action on Huawei.  So who does Edwards seriously think might lead such a debate?

As he says, all politicians have all sold their souls.  I was exchanging notes earlier this week with someone about Jian Yang.  It is easy to blame John Key and Peter Goodfellow for Jian Yang –  they either knew his background or should have, and didn’t really care (or worse) either way.  But the story of Jian Yang has been public for almost 18 months now and no one in politics has disowned him, called for his resignation, called for the National Party to remove him from their caucus.  Not Jacinda Ardern or Andrew Little, certainly not Bill English or Simon Bridges, not James Shaw or Marama Davidson, not David Seymour, not even (despite occasional timorous hints) Winston Peters.  Not even Jami-Lee Ross, who was at the centre of the whole donations business.  Not a single backbencher, of any party, was willing to break ranks and declare the situation unacceptable.  Fixed with knowledge, by their silence they now share responsibility.

It is little different on any of the other aspects of the PRC relationships:

  • the effective PRC control of the local Chinese language media,
  • the refusal to say a word about the Xinjiang abuses (or Falun Gong or Christian churches),
  • the refusal to say anything in support of Canada over the abduction of two of its nationals.

Probably most of these so-called leaders like to think they are somehow serving New Zealand interests.  People fool themselves that way, sometimes without necessarily fully realisng what they are doing.  They aren’t.

So, much as Bryce Edwards might deplore the prospect of an “overly-simplistic” serious public debate, or swelling tide of discontent, I’d cheer on the fact that it was happening at all.  Corrupted systems are rarely, if ever, upended and reformed without a strong strand of –  almost unreasonable –  public outrage.  It hasn’t happened here yet.  I’d like to say it was only a matter of time, but I’m a pessimist.    What would turn things around now after all these years in which our “elites” have degraded our political system (to complement their failures on other fronts, notably productivity)?  Labour and National are, after all, two sides of same coin on such issues, and together they seem to have a stronger hold on the political system (vote share combined) than we’ve seen for some decades.   We don’t have politicians of decency and integrity, and the public show little sign of (effectively) demanding something different.  The PRC Embassy must be pleased.

 

UPDATe (4/2):   There is a new column by Simon Chapple and a co-author on reviewing the rules around political donations.  I’m pretty sympathetic to the sorts of changes they propose, although as I argue above the PRC-influence issues around donations or more about atttitudes and integrity –  knowing what is right and wrong and eschewing the latter –  than something formal external (eg statutory) rules can deal with.

 

Critics of the PM, left and right

I was going to write something short but serious, but then I noticed that Wellington economist (and economics blogger) Keith Johnson had been having another go at me.

I’ve never met Johnson but did rather admire his independent run for mayor of Wellington in 2016, campaigning (as much as anything) against the wildly uneconomic proposal for the ratepayers of Wellington to fund an extension to the runway at Wellington Airport.   From memory, in the STV system used in Wellington, I voted for him (well) ahead of the winner, Justin Lester –  who commits public money as if it is confetti (and whose council is apparently still trying to sort out a traffic management plan to fix leaking pipes in a dead-end street, now leaking for a whole month).   Quite possibly the only thing we have in common is living in the same suburb –  from the occasional photo posted on his blog I reckon I can see his house from where I’m typing.

Anyway, Johnson is clearly not a fan of yours truly.  There was a whole post a couple of years ago rather more sympathetic to Graeme Wheeler in the matter of the OCR leak (which I had alerted the Bank to, only to have Wheeler attack me in a press release).

There has never been any doubt that he comes from the left.   I don’t.     That said, I was very glad to see National ousted in 2017.  They’d done almost nothing in their nine years and, at very least it was time for a change.  No one would have been more pleased than I had the new government actually followed through on the campaign talk about lifting productivity growth and fixing the systematic dysfunction that is the housing market.   I even wrote a post at the time Jacinda Ardern became leader offering some specific suggestions.

Sadly, there has been so sign of anything serious.  Instead, there is a great deal of Prime Ministerial blather, interviews with foreign media, walking and talking with celebrities. But not much sign of real governing, in ways that might make a real difference to (at least) economic and housing outcomes.  And then there is the shameful silence on matters PRC –  I wonder if any of the media will ask her what she made of George Soros’s Davos speech –  he these days a doyen of the global centre-left –  calling on the West to take much more serious Xi Jinping’s threat to free societies.

So, yes, I don’t have much time for Jacinda Ardern.  As I suggested in a previous post, she might be well qualified to be Governor-General.  It is less clear that she is equipped to be Prime Minister.   They were her own words –  published in one of most esteemed serious newspapers in the world –  that I had a go at in my post the other day: lightweight, grossly misrepresenting history, and –  for all the rhetoric –  not offering anything of much substance that appears much different from what has gone before.

Which prompted Johnson’s first post.  He started with some (favourable) comments that economic historian Gary Hawke had apparently made about this blog.

Not that I am totally in awe of either Reddell or Hawke, both of whom are typical of the NZ Establishment – in my view at least being among the Tall Poppy Scything denizens that a young consultant colleague of mine once called a ‘bunch of arrogant bastards’.

I’ll take engagement with ideas and arguments over “awe” any day.

Apparently, I can’t really criticise the PM on productivity or housing

The first and most obvious objection to Reddell’s castigation of Ardern for perpetuating House Price Inflation and Failing to Address our Low Productivity is that He is Part of the System.

One might well ask then ‘What the hell did he do during his career to tackle the problems he identifies?’

That’s easy.  The Reserve Bank doesn’t do productivity or land use regulation.

He goes on

The second major objection of Reddell’s ‘analysis’ is that it is just plain rude.

You can reach your own view on that, but fortunately this is New Zealand not Thailand (lese-majeste and all that), and when you take the job of Prime Minister you should (she probably does) expect all manner of scrutiny.

And getting fully into his game we get this

Purporting to be an erudite independent-minded economic commentator, he nevertheless let slip his disdain of the so-called ‘left-liberal elites’ thereby placing himself firmly in the Alt-Right / Neo-Liberal camp.

Essentially he is arguing in favour of the plutocratic nationalism – in the form of the NZ National Party, the UK Conservative Party and the US Republican Party and Big Businesses Lobbies – and against the possibility of young people rediscovering hope in politics.

This Cassandra sounds to me like a jealous, covetous, exclusive bitch whose ears have been caressed by the Vipers of Malice.

Not sure how much overlap there is between the so-called Alt-Right and the so-called Neo-Liberal camps.  I don’t identify with either.   And, as I noted yesterday, I’m sure the National Party has never mistaken anything I’ve written here for support for them. (Republicans chose as their candidate a man totally unsuited by character and temperament to be President, and if they are more or less sound on abortion, have debuached the public finances and promoted interventionist foreign policies with which I have no truck.

And yet

Not that I disagree with everything that his says about the NZ Economy and its management. He is a smart fellow with whom it would be challenging to engage in a structured discussion on NZ economic policy.

And he is right to warn that rhetoric is no substitute for substance and that pretending to reinvent the wheel of Welfare Economics – while battening down Public Sector borrowing – simply raises expectations that cannot be reconciled or delivered.

I’ll take that.  It was a big part of my point.  There is – so far –  no “there” there amid all the talk of “kindness” and “wellbeing”.

But having, it appeared, largely conceded my substantive point, he presumably thought it necessary to finish with abuse

What I thoroughly disagree with him over is his misunderstanding of the difference between Policy Advocacy by a politician who openly declares her preferences and allegiances, and Policy Assassination by a biased, back-biting pseudo-academic with axes to grind and panties to bunch.

In this regard Mr Reddell should remember that the exercise of power without responsibility is the prerogative of the whore – not of the critic – panties bunched or off.

Never having had an ambition to be an academic, pseudo or otherwise, I’m not quite sure what he’s on about.  Where there is an important difference is between politicians who talk a good talk, and citizens who might reasonably ask for evidence of substance.

As for the weird conception that I wield “power” –  with or without responsibility……..

I came back to Johnson’s blog today to find two more posts.    One runs under the title “Croaking Cassandra: Making NZ A Country for Angry Old White Men” –  which is a bit odd really as, as far as I know, Johnson is white, and quite a bit older than me.   Personally, I’m keen on improving the country for young New Zealanders –  people like my kids who will soon face the prospect of unaffordable housing costs, in an economy heading towards upper middle income status.

The entire post consists of extracts from readers’ comments on my post on Ardern’s op-ed run together.    I’m not sure what the point is, although I have left a comment on the post to ask.  I’m bemused, but I thought some of you might be interested to find bits of your comments popping up somewhere else.

And then there was a third post headed “Jacinda Ardern: When Kindness May Not Be Enough”.   That sounded like music to my ears.

But before he got to his own substantive points, there was another go at me.

Apropos of my defence yesterday of our NZ Prime Minister Jacinda Ardern against the harridan drag artist blogger Croaking Cassandra,

“Harridan drag artist blogger”: well, that’s a new one.  Surely it must offend the sensitivities of some oppressed minority?   (But not me –  it just seems weird.)

But that was just a lead-in to an important observation from someone on the left

“I nevertheless feel the need to sound a note of caution on the gushing approbation that our girl is receiving in the world’s media from those of leftward tendencies.”

Hard to disagree, although personally I try to avoid describing adult women holding responsible accountable offices as “girls”.

He goes on to include lengthy extracts from an article on a local left-wing website, and cautions against paying too much attention to Helen Clark’s gushy promo for the Prime Minister  in Foreign Policy.   And then offers his editorial

“Of course, I massively endorse the sentiments behind Kinder Government –  as well as being more than ready to support Women Warriors against the Baddies who are often authoritarian. reactionary, and male.

But much of what is being said is Not New….

In fact, it may all be perceived by many as yet another illustration of what I have termed The Big Lie.

So Jacinda –  Go for It – But retain some humility.

Don’t get caught in your rhetoric and over-promise.

And kindly take account of the realities [including] you lead a front bench that is very short on real talent.

Hard to disagree really, although personally I don’t much care whether Prime Ministers are male or female. Performance is what should matter.  And we aren’t getting it.

But apparently never content to end with a rational mildly-sceptical take on his own sainted leader, Johnson feels the need to hit out again.  This is the final paragraph of that post:

Quite apart from that, you need to spend a bit more time covering your derriere. You can’t expect those accustomed to power who are authoritarian, reactionary, and male [i.e people like Croaking Cassandra Michael Reddell] to let you do your thing unmolested.  Believe me –  they are coming for your girl.

So  –  on his own terms –  his leader has a front bench without much talent, appears to be over-promising and underdelivering, and what she has to watch for is people like me.     It would be the voters I’d be more worried about if I were her.  New Zealanders seem to rather like their Prime Ministers being feted by overseas media and celebrities (whether Ardern or Key) but there will come a time when they are impatient for results.  Better results need better policy.  Johnson himself more or less makes that point.

And then I noticed a more-eminent commentator from the left, Chris Trotter, also had some new comments on the Prime Minister under the heading “The Jacinda Problem”.

It would seem that we misunderstood the Labour leader when she promised us a transformational government. Our naïve assumption was that she intended to transform New Zealand society when, clearly, it was herself she was determined to transform.

There will, of course, be a great many Kiwis who cannot get enough of their PM’s global celebrity status. Seated on the same stage as Sir David Attenborough. Discussing mental health with Prince William. What’s not to like? Jacinda is only going where Bono has so boldly gone before.

He goes on to make various policy points –  serious stuff not being done – where I might differ on specifics while endorsing general thrust, but this is his conclusion.

Jacinda is the most accomplished ambassador for New Zealand to have graced the global stage since David Lange bowled-over the Oxford Union. That is not, however, enough. Jacinda is not New Zealand’s MC, she’s our PM.

It’s time for her to start acting like one.

There is lots of rhetoric, lots of moving among the echo chamber of the like-minded overseas elites, but not much substance, all underpinned by even less robust analysis.

Keith Johnson can call me all the names he likes –  perhaps “harridan drag artist blogger” should now appear on the banner for the blog?  – but it doesn’t change the unease that thinking people from both left and right are beginning to feel.  Where’s the beef?

 

 

 

 

 

 

 

More empty rhetoric, bad history, and absent analysis

There was an op-ed in the Financial Times yesterday that had all the appearances of being written by a fluent sixth former who wasn’t that smart and certainly wasn’t that deep.  But I guess we have to take the FT’s word that the column was in fact written by New Zealand’s Prime Minister, Jacinda Ardern.  It read like several of her other efforts (eg here) if with a bit less feel-goodism than some, and a bit more of just making things up.

Since the column is behind a paywall, I won’t be copying chunks of it directly into this post, but even if you don’t have access I hope you get the gist.

She starts with the claim that New Zealand is “tiny”, apparently oblivious to the fact that in the United Nations list of countries and territories there are 100 with populations less than four million.  But that claim is really just staging for her opening (and closing) claim about the mouse that roared: “we punch above our weight”.  This is the sort of vapid (typically deluded) story that countries –  and perhaps especially countries’ ministers and officials –  like to tell themselves in private, but which quickly become rather embarrassing, a sign of insecurity and doubt more than anything, when uttered in public.

The only concrete evidence she adduces for this claim is 125 years old: New Zealand being the first country to grant women the right to vote, in 1893.  Good for us, but rather a lot of water has flowed under the bridge since then.  (And even from that era, I happened to be reading last week a biography of that courageous British campaigner Josephine Butler, who led the push for the repeal of the Contagious Diseases Act (in 1886) – this was, perhaps well-intentioned, legislation that grossly infringed the dignity and civil rights of women. Out of curiosity, I looked up the New Zealand experience: we finally repealed ours almost 25 years after the Brits.)

Almost every country has some “first” to its name, and some black spots from its past.   In our short history (whether you think of it as 200 years or 1000) New Zealand is no different.  The Prime Minister moves on to the claim that we were “one of the first” to put in place a “cradle-to-grave social welfare system that endures in some form to this day”.  Do note that “in some form”, as if the Prime Minister is trying to suggest that in decades since then the welfare system has been ripped to shreds, only the tattered remains enduring, when in fact we now have 300000 working age adults receiving welfare benefits and about 750000 getting universal New Zealand superannuation.  And today’s health and education spending (numbers, share of GDP or whatever) puts 1938 in the shade.

(And no mention, of course, of the fact that just a couple of years later, New Zealand was putting in place  some of the most restrictive provisions around press freedom and conscientious objection found anywhere in the free world during the war.  As I say, even the sainted Peter Fraser  –  from the Prime Minister’s own party –  has his blackspots.)

The Prime Minister moves on to claim that “we are sometimes the first to learn valuable lessons”.   This is an introduction to the sixth former’s account of the reform process of the 1980s and early 1990s.

Starting in 1984, New Zealand went further and faster than nearly any country in embracing the prevailing neo-liberal economic experiment. We slashed the top tax rate, dramatically cut public spending, removed regulations that were said to hamper business and vastly reduced welfare benefits paid to the sick, those caring for children and the unemployed.

It isn’t even clear where to start here.  There is no recognition that we’d been quite late to the party, have wrapped up our economy in heavy protection and distorting regulation for several decades –  more so again than most other democracies.  Many –  not all –  of our reforms were about catching-up again.   And yet she can’t even bring herself to acknowledge the costs and distortions (notice that “were said to be”).   Or to claim some credit –  for her own party –  for the overdue reductions in trade protection that the reformers put in place.   Or to note that as the top marginal tax rate was cut, so the tax base was broadened, and opportunities to avoid paying tax were substantially diminished.

Here is the evil low-tax regime that was created, as illustrated with OECD data on general government total receipts as a share of GDP going back to 1995 (which is about when the reform process ended, and also when the OECD has fairly complete data).

receipts

Over that quarter-century, we’ve basically been the median OECD country (literally so in in several years this decade).   The comparable spending chart isn’t so very different (although we spend less than most relative to tax receipts –  another way of saying we’ve avoided deficits and kept debt low), although the one period in the last 25 years in which government spending looks quite low by international standards is……the first half of the term of the previous Labour government.

But even now the Prime Minister is just warming up because her theme appears to be inequality.  Never mind that the labour share of GDP hasn’t changed much in 30 years now, or that wage growth has been running ahead of growth in GDP per hour worked.   Never mind the indications that inequality measures haven’t changed much here for 25 years, or that much of any concerning developments seem to relate to the spiralling costs of housing –  a development only made possible by restrictions imposed and maintained by successive National and Labour governments.  No, it is all the liberalising economic reforms that are “to blame”.

And all this while, oddly (but as she did during the election campaign), appearing to accept that narrative that somehow our economic performance has been just fine.  But, of course, there are no mentions of our shockingly poor long-term productivity growth performance (past and present), no recognition that New Zealand export and import performance has been disappointing, no nothing.  Far from “punching above our weight”, it is hard to conceive how a country which had built what it had in, say, 1913 could have done so badly in the subsequent 100 years –  without even the excuse of the physical devastation of war, military coups, or Communism.

Of course, none of this seems to be based on any analysis or research.  Instead, the Prime Minister tells us of her childhood memories, in which kids in the town she was living in “weren’t born into a decade of hope and opportunity, but one of inequality where users had to pay for basic services”.  Perhaps she means they had to pay for food and electricity, but then users have always had to pay for those?  As for schools and hospitals, they were –  and are – more or less free, and we’ve never the British system of generalised free GP visits.  So what on earth is she talking about?

And then the violins start up to accompany a mournful tale of the death of democracy and of prosperity from which she, and the New Zealand way, can save us.

We don’t need to start again, but we do need to change the way we do things. In May, my government will present the world’s first “wellbeing budget”.

All, apparently, premised on the weird, tendentious (and borderline dishonest) claim that any government anywhere –  especially in the free world –  has ever defined success solely in terms of GDP.   Perhaps she could pause a moment in her progress among the left-liberal elites to give us some evidence for that claim?   Have governments not been spending on education, on health, on defence, on age pensions, even on arts and the culture for generations now?  Not just in New Zealand but around the advanced world.   Have not cost-benefit analyses –  that don’t just cover GDP effects –  been part of spending evaluation for decades?

And thus the great mystery of the much-vaunted “wellbeing budget”?  Is anything going to be any different from what we might we might expect from a left-wing coalition government anywhere that happened to be running budget surpluses.   In her column, the Prime Minister talks of spending more on mental health, especially for young people.  You might think that is sensible (I suspect that, even if some of the spending is worthwhile, it is going to be mostly papering over cracks, while refusing to address the social and cultural issues that underlie the problems we observe) but it is what left-wing governments typically do –  they throw more money at things.   Perhaps it is even what the voters want –  after all, globally, government spending as a share of GDP is typically higher than it was 50 years ago –  but don’t try to pretend that it is a whole different approach to life, economic management or government management.  One only has to look at the wellbeing dashboard to see a grab-bag of vapidity, rather than a serious approach to better policy.  It is, among other things, a cover for the utter failure to even begin to grapple with the repeated failure on productivity.

(And, of course, while on the subject of increased spending, there is the oddity that people from the left and right point to: she proposes to change the world, laments how public spending was slashed, but her government published plans just before Christmas that involve

On the government’s own numbers (and these are pure choices, made by ministers), core Crown spending in the coming five fiscal years (including 2018/19) will be lower every single year than the average in each of the three previous governments, two of which were led by National.  

She goes on to claim that “this isn’t woolly but a well-rounded economic approach”.  Perhaps around the Cabinet table and even among some of her Treasury acolytes they even believe this nonsense. In fact, it is no economic approach at all, consistent with a government that has done nothing –  seems to plan nothing –  to reverse the decades of relative economic decline, that have so badly limited the possibilities for New Zealanders (reflected, inter alia, in the decades-long exodus of New Zealanders).   Weirdly, she claims that this “well-rounded economic approach” is same one she plans to use to respond to (inter alia) climate change, domestic violence, and housing.   This in a week when the latest Demographia report again reminds us just dreadfully unaffordable housing is in New Zealand –  and when her surrogate senior minister could go through an interview on the subject on Morning Report yesterday and not even (that I heard) mention land liberalisation.

Warming to her theme, the Prime Minister calls on those around the world to look to her “wellbeing approach” could be a “model” for others to respond to the problems of the world.  She asserts

I wholeheartedly believe that more compassionate domestic policies are a compelling alternative to the false promise of protectionism and isolation.

Spending more is apparently the answer….but (on her own rules) not more than 30 per cent of GDP.   Nothing at all, of course, about lifting productivity growth.  Nothing about fixing the huge regulatory distortions that render housing so unaffordable in many countries, notably her own.  Just more compassion.  More kindness.

As I observed of one of her earlier vapid efforts

We don’t want political leaders who can’t identify with individual need, opportunity and so on.  And yet, when one is dealing with five million people –  and government policy choices affecting many or all of them  –  you need to be able to stand back and think about things differently, to analyse issues systematically, to recognise (for good and ill) the force or incentives, to think about the longer-term as well as the short term, and so on.   And even to recognise that values and interests can, and often will, be in conflict –  in many areas hers aren’t Family First’s or the oil and gas industry’s  (or mine for that matter).  Politics is partly about navigating those differences, seeking reconciliation where possible, but also about making hard choices and trade-offs.

There is no sign that she brings any of those skills to the job.  Just a smile and lots of breezy vapid blather.

The Prime Minister ends her column with another deluded call, suggesting that she hopes New Zealand can once again “punch above our weight” by “forging a new economic system based on this powerful concept [guardianship]”.   Which might perhaps be fine if there were any substance to what she is talking about, but there is no sign of any.  She wants to spend a bit more (but not much), she wants to eliminate net carbon emissions in an country with seriously high abatement costs which her own government’s consultative paper data suggest will fall most heavily on the poorest, and she does nothing at all to fixing the disgrace that is New Zealand housing affordability, or to even think about reversing decades of relative decline.   Perhaps it all sounds good to a few readers –  and Davos attendees –  but it offers nothing of substance to New Zealanders, let alone to the world.

 

Cowering and contemptible

A couple of weeks ago I wrote a post about the utter silence, from all New Zealand officeholders (most notably the Prime Minister), about the abduction –  no better word for it –  by the People’s Republic of China of a couple of Canadian citizens, apparently in an attempt to coerce Canada into not proceeding – in the event the Canadian courts find that the other terms of the treaty have been met – with the extradition to the US of the Huawei CFO.

….you have to wonder what goes through their minds when Jacinda Ardern and Winston Peters decide to stay quiet, when our traditional allies speak out.   Does it not for a moment cross their mind that one day New Zealand might find itself in Canada’s position, and to wonder who –  if anyone –  might go into bat for us, and for our citizens if they were to be abducted by the regime in Beijing?

By their utter silence, on this as on so many other PRC issues, our MPs and ministers dishonour this country and its people.   Cowering in a corner, deferring to Beijing, is simply unbecoming people who purport to lead a free and independent country.

It isn’t as if any of this is particularly new.  Our Prime Minister won’t speak up about the gross abuses in Xinjiang, won’t speak up about the intensified persecution of other political and religious dissidents, won’t speak up about…..well, almost anything.  But somehow it is a degree more shameful when you won’t even stand up for your friends.   When you are the cowardly one when others around you – in this case, other advanced countries – have been willing to make a stand.  It is contemptible behaviour.

There was more news this week.  We are told that the Prime Minister took a call from Canada’s Prime Minister Justin Trudeau.  I suppose she didn’t have much choice but to take the call –  Trudeau has after all been seen as cut from the same left-wing ideological cloth as the Prime Minister.    But the Prime Minister wouldn’t even comment on the call –  has anyone heard from her on anything for weeks now? – instead sending out not even the government’s ‘duty minister’, but just a spokesman for him, to blather and say nothing.

Ardern was not available for comment today but a spokeswoman for duty minister Grant Robertson confirmed Ardern had a brief conversation with Trudeau yesterday.

“Although the cases are a consular matter between Canada and China, as the extradition case relates to a Huawei executive in Canada, there are principles at stake that concern us all.”

What an utterly meaningless statement.

Perhaps, perhaps. the Prime Minister had quietly given her support to Trudeau but just didn’t want to let New Zealanders know?  It never seemed very likely, but a day or so later the Canadian Foreign Minister pretty much ruled out that (exceedingly charitable) interpretation

Ms. Freeland said Canada is grateful for the support it has received in recent days from Germany, Estonia, France, Latvia, Lithuania, the Netherlands, the United Kingdom Britain and the United States.

But not New Zealand, even though the two Prime Ministers had talked just a day or two previously.

When I mentioned this around the dinner table, one of my kids suggested that perhaps New Zealand was just small and had been forgotten.  But, of course, not only is New Zealand a traditional close friend, ally, and partner of Canada, but we are bigger than any of the three Baltics in the list.  Clearly, Canada is receiving no support at at all from New Zealand.

It isn’t the way decent people behave.  But it seems to be an acceptable standard for every single one of our elected officials; cowering contemptibly.

Who knows quite what it is they fear?  Perhaps it is that “FTA”- upgrade, or the trip the PM wants to make to Beijing, or some threat to the success of their year of Chinese tourism, or the flow of political donations, or whatever.    Whatever the rationalisation, it is shameful, and imprudent.   Just as schoolyard bullies try to pick off weak kids one at a time, so the People’s Republic of China.  But Ardern –  and Peters, Bridges, McClay, Shaw et al – simply refuse to recognise the character of the regime.  Perhaps there might be a modest cost to some entities if New Zealand were to take a stand –  on an egregious abuse –  but any worthwhile moral stance almost inevitably involves a cost. It is the willingness to pay a price that, in many respects, marks out the value someone places on their belief.  There is little sign that, when it comes to the PRC, our leaders put any value at all on any beliefs –  just deals and donations.

On which note, the Executive Director of the government-funded pro-PRC propaganda agency, the China Council, returned from his holiday to tweet on this issue.

When I first saw the tweet I was momentarily pleasantly surprised, until I realised that what Jacobi was actually championing was the line that somehow New Zealand could be a bridge between the PRC regime and the rest of the world.  The old “elite New Zealand” delusion that somehow by making nice to evil, never ever uttering a complaint about anything –  recall how upset the China Council was when the Huawei ban was announced – we could influence Beijing for the better.   That’s worked out so well over the last seven years as Xi Jinping has taken the PRC ever further back to heavy-handed repression at home, and into an era of new aggression abroad.  Cosying up to such evil should be something to be ashamed of, not trying to fool yourself and others that somehow the regime will be deterred from its aggressive defence of Meng Wanzhou by sweet nothings murmured quietly (if at all) by our Prime Minister or her officials.

Finally, on things PRC, there was a strange column on Newsroom the other day by Robert Ayson, professor of strategic studies at Victoria University.   His lament is that New Zealand/PRC relations are not what they were, while his vision appears to be one of “untrammelled mutual respect and win-win cooperation”, as if he cares not a jot about the character of the regime.  Perhaps he’d have been one of those urging “untrammelled mutual respect” with Adolf Hitler in the late 1930s?

Ayson seems bothered about several things:

  • the proposed ban on Huawei around the new 5G network (where he seems to treat Hauwei as some sort of normal company, even though Chinese law requires Hauwei to comply with government edicts, whether at home or abroad),
  • the recent GCSB statement –  in tandem with a number of other countries –  about the official PRC involvement in commercial cyber-theft,
  • the rather mild comments in the Strategic Defence Policy Statement last year, and
  • the speech in Washington in December by Winston Peters.

All this is the context of a flawed sense of how much China matters to New Zealand’s prosperity (“crucial” in his view).

Professor Ayson is not happy at all.

This shift may please friends in Canberra, Washington and Tokyo, who view China as an unrelenting full-spectrum menace. But New Zealand’s growing alignment with a faux Cold War posture runs against the tradition of foreign policy autonomy Labour-led governments have cherished in recent decades. 

(The same Labour-led governments that have had troops in Afghanistan and Iraq?)

Having an independent foreign policy means making your own choices about the medium-term interests of your own country.  It doesn’t mean never doing things, or sharing common views/interests, with friends and allies.  I’m not sure when Professor Ayson thinks any New Zealand governments ever acted otherwise (whether or not he –  or I – agreed with any or all of those stances –  be it involvement in the first Gulf War, providing a frigate at the time of the Falklands, Vietnam, Suez, or even our current deployment in Iraq).  But in the Ayson view of the world –  seemingly similar in practice to the Prime Minister’s –  an independent foreign policy seems to imply acting entirely on your own, never in concert with anyone, never acting for common interests and values, never acting with a quiet expectation of possible future reciprocal support.

Personally, I don’t think we should be taking a stronger stand against the PRC because, say, the United States is, but because it is in our own longer-term interests to do so –  both about the integrity of our own political system (recall, for example, the former PRC intelligence officer sitting in our Parliament, nominating other Beijing-associated people for honours), and about pushing back against international expansionism (particularly  by a state/regime with values inimical to our own).

But for Professor Ayson, somehow Trump and Brexit are reasons to stay cowering in the corner, deferring to the PRC.

There is one final, very small, fly in the ointment. It would be one thing to add New Zealand’s principled voice to an ensemble of China concern if the choir was unified and led by an internationally respected conductor. But has anyone seen how today’s conductor is behaving? In Donald Trump’s universe, traditional allies and close partners are at best expendable and at worst counter-productive. To the 45th president of the US, the rules-based order is barely relevant, including as it applies to trade. Things would be even worse if any of New Zealand’s remaining five eyes partners weren’t outward-looking models of political reasonableness. 

That’s called playing distraction (perhaps especially in the UK case where, whatever one makes of Brexit, the UK remains fully engaged in both NATO and Five Eyes, and has upped its commitment to this region, including naval patrols in the South China Sea).   You might not like everything about your friends and allies –  some might even be inconstant –  but you actually share values and interests with them.  Few New Zealanders share the values of the Chinese Communist Party or the state it tightly controls.

Ayson’s article ends weirdly.  He wants relations with Beijing strengthened, he wants “balance” back in our foreign and defence policy –  does he mean indifference to China’s consolidation of its hold on the South China Sea, indifference to its plays for influence in PNG, Vanuatu, Tonga, and (perhaps newly-independent) Bougainville), indifference to the growing threat to free and democratic Taiwan?  If so, perhaps he could say so directly.    But the weird bit isn’t that sort of alleged “realpolitik” but the final sentence

But especially in light of Beijing’s reprehensible conduct in Xinjiang, in which case, to borrow the prime minister’s own words, New Zealand needs to begin “Speaking up for what we believe in, standing up when our values are challenged,” this necessary readjustment will not get any easier.

After all it appears that he recognises something of the character of the regime.  But if –  as he says –  he wants the Prime Minister to start speaking up about that evil, it is unlikely to be a path that works towards sweeter and more harmonious relations with the PRC.  Decent people wouldn’t want it to.