What a (revealing) travesty

Late yesterday morning, the government announced that it was going to ram through all its stages under urgency, the Electoral Amendment Bill (No. 2).  By the time you are reading this, the bill may already have been passed into law.

The goal of the legislation appears to be to suggest, at least to those who don’t follow politics closely, that the government is “doing something”.  The Minister’s press release announcing the bill is headed “Government to ban foreign donations”, but in fact it does nothing of the sort.

The Explanatory Note on the bill is more honest, that the law is more about signal than substance

The Bill makes several changes to the Electoral Act 1993 to send a clear signal that only those who are part of New Zealand’s democracy, and who live in, or have a strong connection to, this country, should participate in our electoral system.

But although the heading of very next section sound promising, again the substance outs

Ban on donations from overseas persons

The Bill amends the Electoral Act 1993 to restrict donations from overseas persons to political parties and candidates, to reduce the risk of foreign money influencing the election process.

The changes are being applied only to parliamentary elections, not local elections.

The Bill bans candidates and parties from accepting donations over $50 from an overseas person in any form.

The definition of an overseas person in the Electoral Act 1993 is not being changed. The ban applies to donations from—

  • an individual who resides outside New Zealand and is neither a New Zealand citizen nor registered as an elector:
  • a body corporate incorporated outside of New Zealand:

  • an unincorporated body that has its head office or principal place of business outside New Zealand.

So if there is any (serious) signal at all, it is that local body elections don’t matter (there are no still restrictions at all on foreign donations to local body campaigns, even though we know that, for example, prominent candidates in Auckland have been associating closely with PRC United Front individuals/entities, or that –  for example –  Southland mayor Gary Tong was being courted by close regime-affiliate Yikun Zhang).

The other “signals” are rather more implied:

  • first, since the foreign donations limit is being lowered from $1500 to $50, but the anonymous donations limit is being left at $1500, any foreigner who really wants to make a $500 donation should just do so anonymously.     This was an issue the Ministry of Justice highlighted in its (not very good) RIS, but the government chose not to act on, and
  • second, none of this intended to be serious at all, just theatre.

How do I justify that second point?  Well, check out this table from the RIS.

justice donationsThis just isn’t where the (foreign) money is.  All “foreign donations” –  as the law is drawn at present, and will be when the bill is passed –  averaged just under $5400 per annum across almost all our political parties.  Those are derisory sums of money, rightly tightly limited.  The new law will, almost certainly, reduce the derisory sums under this heading to almost zero.

So where is the foreign money?  First, and we know this from political party returns –  they aren’t really hiding it, even if they won’t engage on it –  is donations from foreign-controlled companies operating in New Zealand.  There have been two particularly prominent examples highlighted in recent years: donations to the National Party from Inner Mongolian Horse, and one from another Chinese billionaire’s company that was facilitated by Todd McClay and Jami-Lee Ross (the latter told us again all about the transaction in his Second Reading speech last night).   It isn’t a new discovery that this avenue is open.  Some call it a “loophole”, but it looks a lot more like a design feature –  ie even if not envisaged when the law was originally drafted, all parties in Parliament have been content to leave the definition of “overseas person” unchanged, in full knowledge of how the provision was being used.

That would have been easy to fix, if the government had been interested in doing so. It clearly wasn’t.  It is where a lot of money has been in the past, and if they argue things need to change before next year’s election, this is what they could –  quite readily-  have changed.

And the second, of course, much harder to deal with: funds donated by people who are now New Zealand citizens, but who have close associations with foreign regimes, notably the heinous CCP regime in the PRC.  I’ve seen people talk about the risk of foreign regimes directly channelling funds to such individuals and them passing the money on under their own (New Zealand citizen) name.  Perhaps, but things don’t need to be that direct to be highly troubling.  Reciprocity is a real thing, whether or not anything is ever written down.   I’m not sure what the law can do about this particular risk, but political parties can.  Political parties can choose to do the right thing, and declare –  and take seriously – a determination not to take money from, or solicit it from, people –  even registered electors –  who are known to have close associations with foreign regimes, perhaps especially with such troubling regimes as the PRC (or the Soviet Union in days gone by, for example).     But there is no sign of such a willingness to commit, to self-restrain, from any of the parties in Parliament.  None.

Thus, I heard National MP Nicola Willis give a decent speech last night in the second reading debate, that seemed to suggest she thought there were real issues and problems that needed addressing. But there was no sign from her –  or any of her colleagues – that they were willing to commit to a different model of behaviour.    Nothing from the Prime Minister either, even though she has previously been critical of some of donations that have flowed to National.  She’s the Prime Minister.  She could legislate, she could set an example.  Instead, we just have political theatre, while avoiding the real issues.

(The Opposition leader, of course, is quite as bad here –  albeit out of office.  Listen to his trainwreck interview with Kim Hill on Morning Report this morning, where he tries to avoid even acknowledging any sort of serious issue.)

And then, of course, there is the process –  ramming this law through under urgency, with no select committee submissions, hearings, or deliberation.   Things weren’t even done quite that badly with the gun control legislation earlier in the year.    Hardly any law should ever be passed that way, and certainly no electoral laws.  But what is also remarkable is that looking through the Minister’s press release, the Explanatory Note, the RIS, and Hansard records of the debate last night, I could see no substantive justification from anyone on the government side for this extreme urgency.  The bill won’t even come into effect until 1 January –  so they could readily have had even a week at a Select Committee, a week for people to think through the details carefully. It is a travesty of a process.

There have been various attempts to suggest that the problem here was really the Justice select committee, which has been dragging its feet on reporting back on its inquiry into foreign interference.    If only they’d reported, it is suggested, such a rushed and limited bill might not have been necessary.

But that sort of story doesn’t stack up at all.  First, even though the Committee is split equally between government and Opposition members, Labour provides the chair, and a good chair would be able to facilitate the process, and build coalitions.  In fact, we are now (so it is reported) onto the sixth chair for this particular inquiry, and many of the members now on the Committee weren’t members when much of the evidence was heard.  And it is only nine months or so since Labour was backing their chair (Raymond Huo) in his stated desired to prevent any public submissions at all, quite content that government departments could provide all that was needed.

More importantly, the government is supposed to govern and to lead.  All the issues around donations –  including foreign donations – have been known for a long time now. And it is not as if the Justice Committee (with its endlessly rotating membership) has any specialist expertise on these issues, or access to policy and operational advice not open to the government itself.  The government is far better equipped to act,  if it wanted to.  But it is chosen not to until now, and now it is just engaged in insubstantial trivia –  grabbing a few headlines, but not changing anything.    They could have had a bill in the House six months ago, with time for proper select committee consideration, outlawing donations (for central and local government campaigns) from anyone but registered New Zealand electors, and with full and near-immediate disclosure.  But they consciously chose not to.  And if, perchance, Labour wanted to act –  seems unlikely –  but didn’t think it could the numbers, it was a great opportunity for some Prime Ministerial leadership, to embarrass other parties into acting, and to set an example with the new and better limitations Labour would adopt for its own fundraising.

But we’ve had none of that.  Either the Prime Minister wasn’t capable of such leadership or wasn’t interested in displaying it.  Either should be a concern.  She runs the government.

There was a few good speeches in the debates last night, but in the end only one member –  ACT’s David Seymour –  was actually willing to oppose this piece of theatre.    Perhaps political parties were reluctant to be wedged – being seen to oppose a bill that (appears) to limit foreign influence – but I doubt that really explains much.  It probably suits National quite as much as Labour –   even allowing that they are serious about their process concerns around urgency –  to be seen to have “something done”, even as nothing much substantive changes.

Outside political parties, I guess views can differ.  I noticed Professor Anne-Marie Brady welcoming the bill (she was responding to my lament that Jami-Lee Ross had made a forceful speech about the bill avoiding all the real issues, yet voting for it)

I disagree with on that.  It is probably worse than nothing because (a) the donations it will actually restrict are derisory in total value (see above), and (b) because it tries to fob off the public with a sense of “something being done”, even as the real issue are almost entirely avoided.  The public typically has a limited attention span for such issues, and this will have people who’ve had only a half an ear to the issue nodding along with the “at last something is being done”).  But the CCP, the PRC Embassy, those regime-affilated business people –  resident here or abroad –  will know that nothing real has been done at all.  And in the entire parliamentary debate –  that I’ve read or heard – the elephant in the room, the CCP/PRC, is not even mentioned.  So at least one more election will pass with the ability to raise large amounts from PRC-affiliated sources will go on, even as the true character of the regime becomes more and more apparent. (Of course, any restrictions should apply to all foreign donations, but no serious observer supposes that the biggest issues at present are around the PRC).

Perhaps we will eventually see the Justice Committee’s report on foreign interference issues.  Simon Bridges implied this morning that it won’t be much longer delayed, although suggesting that there are likely to be two different reports.  But it seems highly unlikely we will be much further ahead.    The Committee has no personnel or expertise or analysis not already open to the government –  in fact, the RIS on today’s bill had the Ministry of Justice noting that they had paid attention to the submissions –  and there is no figure of any real stature (no Andrew Hastie, for example, in the Australian context) on the Committee, let alone chairing it.

Bu then there are no figures of any real stature leading our politics.    Today’s bill, today’s process, demonstrates that again.

My own submission to the select committee inquiry is here.   That submission included

There are some specific legislative initiatives that would be desirable to help (at the margin) safeguard the integrity of our political system:

• All donations of cash or materials to parties or campaigns, whether central or local, should be disclosed in near real-time (within a couple of days of the donation),

• Only natural persons should be able to donate to election campaigns or parties,

• The only people able to donate should be those eligible to be on the relevant electoral roll,

However, I summarised

But useful as such changes might be, they would be of second or third order importance in dealing with the biggest “foreign interference” issue New Zealand currently faces – the subservience and deference to the interests and preferences of the People’s Republic of China, a regime whose values, interests, and practices and inimical to most New Zealanders.  Legislation can’t fix that problem, which is one of attitudes, cast of minds, and priorities among members of Parliament and political parties.   Unless you –  members of Parliament and your party officials –  choose to change, legislative reform is likely to be little more than a distraction, designed to suggest to the public that the issue is being taken seriously, while the elephant in the room is simply ignored.    It is your choice.

Today’s legislation is just such a distraction.

Spin….just spin

I suppose all Prime Ministers these days feel the need to spin.

Ours was at it again yesterday.   She was talking over breakfast –  a vegetarian one the Herald account tells us – to the Trans-Tasman Business Circle.  Her topic?

The topic I have been given for today – ‘The Future of Work and how the government is preparing for the economic challenges of the future’

It is pretty much downhill from there.

Countries the world over are currently grappling with digital transformation, and transitioning their economies, and New Zealand is no different in that regard.

Even if you pardon that abuse of the language (“transitioning”), does anyone have any idea what this means. Individuals and firms are getting on with their lives, looking for opportunities, as it long has been and no doubt long will be.  Are technologies different than they were fifteen years ago?  Of course.  But is our economy that different than it was fifteen ago?  Sadly, probably less so than one would hope.

That isn’t the prime ministerial spin though

Where we are different, I believe, is in the way we are responding to those challenges, turning many of them into opportunities.

The country with weak productivity growth, drifting further behind the rest of the advanced world, and with declining shares of GDP accounted for by trade with the rest of the world.

As it happens, the annual national accounts were released later yesterday morning.   I was playing around with the data and might use it for various posts in the next few days, but since the PM was talking about “digital transformation”  I thought this chart was interesting.

cap stock 19.png

Now not all of these, by any means, are about the narrow “digital transformation”, but if such a thing were happening on a large scale, in which new world-beating opportunities were being developed and seized, these indicators are among those where we might expect to see it.  As it is, over the last few years things to have been more or less going sideways.

The PM went on to first offer some context

Firstly, the NZ economy is in good heart amid the global challenges and what many believe are new economic normals,

Well, okay, believe that if you want.  But most respondents to surveys don’t share your positivity, and in general they are less likely to be motivated reasoners than a PM.  And

Secondly, the Government and Reserve Bank are doing their bit to ensure that fitness endures and it’s important business continues to work with us too – after all, we mustn’t talk ourselves into a funk

We are right, you are wrong.  Get with the message.  Or at least that seemed to be what she was suggesting.  Just a shame the data don’t tend to support her.  I’m still not sure what the Reserve Bank has to do with “that fitness” (whatever it is) –  presumably she hasn’t had it schooled into her that the OCR is typically cut (in an economy without big positive productivity shocks) because demand is weak and things aren’t going that well.  Oh, and is she perhaps aware of those big new capital requirements the Governor is wanting to impose on banks, and hence on the availability of credit to the economy?  If she is embracing those, that would be an interesting call –  her Finance Minister has been very careful to disown all responsibility.

Anyway, she gets into her stride in a section headed “It’s the economy”.

All of you in this room will know that this Government’s approach to the economy is that it is not an end it itself but, rather, a means to an end.

Which might be news if, just perhaps, she could point us to any government in history, or even just New Zealand history, for whom that was ever not so.

That of course means building strong economic foundations. And on that front we’re doing pretty damn well actually, especially amid global uncertainty.

The argument must be weak so lower the tone of the language.  No one is going to dispute that successive New Zealand governments have successfully focused on budget balance and a modest level of debt.  What about her other claims?

So far our policies have delivered growth of 0.5 percent in the June quarter and average growth of 2.4 percent in the year ending June. That shows that the New Zealand economy continues to outperform those of Australia, Canada, the Euro area, the UK, and the OECD average – basically those we compare ourselves to.

That tired old line so beloved of whoever is in office, right or left, and their champions.  Never mind that we have substantially faster population growth than all of those countries except Australia and that any reasonable and honest use of GDP statistics in a a discussion about success, wellbeing or whatever, starts from a discussion of GDP per capita.    On that score, there is nothing impressive about even our recent record, let alone the longer-run picture.

Also, recent data shows New Zealand’s manufacturing and services sectors are both expanding.

Well, yes that is probably so, but…..when your population is growing by 1.5+ per cent per annum if those sectors (ie the bulk of the economy) were actually contracting it would be really quite alarming.

We have record low unemployment and annual wage growth is at its highest level since the 2008 financial crisis. Average wages have increased by 4.2% in the last year alone.

Yes, relatively low average unemployment –  consistent with the typical person being unemployed for “only” two years in a working life –  is one of the successes of the New Zealand policy framework.  But the current rate is nowhere near a “record low” –  not even during the 30+ years of the HLFS (that was just prior to the last recession), let alone the post-war decades prior to the quarterly survey getting going.

New Zealand continues to be a good place to do business, topping the World Bank’s 2019 Ease of Doing Business index. Our globally competitive economy is underpinned with stable political and regulatory systems, an innovative well-educated population and our proximity to 60 percent of the world’s population. We are a safe place to invest.

Such a great place to do business in fact that (a) business investment remains persistently weak, especially given the surge in the population, (b) our economy is becoming more inward-focused (trade shares have been falling) and (c) another tired old line –  we are close to 60 per cent of the world’s population –  that bears just no relation to reality whatever.  Yes, we are closer to the centre of gravity of world economic activity than we were 100 years ago – when we traded mostly with the then-dominant power the UK –  but these days the UK is still closer to India and as close to China as we are.  In both cases, far away.  Oh, and we are also a long way from those leading productivity economies in Europe and North America.

And last on this list

And you’ll note that when the Reserve Bank announced its decision to hold the Official Cash Rate at 1 percent last week, its analysis confirmed the economy is in good shape, amid global economic headwinds. The Bank pointed out that employment is pretty much at its maximum sustainable level, residential investment is increasing and that economic growth is expected to rise next year, due to the Government’s investments. While the RBNZ noted that global headwinds have impacted business confidence in New Zealand, it also said that our investments are forecast to support and grow the economy next year.

When the Prime Minister says “investments” here she really just means more government spending, most of it consumption or transfers.  Probably she didn’t read the Reserve Bank’s statement, but she will have had a personal briefing from the Governor.  He too is inclined to spin, but his document had a rather lot on the downside risks –  in fact they explicitly noted, and formed policy on the basis of, the balance of risks being to the downside.  And while the Bank had rather upbeat growth forecasts, few private economists shared their optimism.

I am not wanting to suggest things are disastrously bad, at least in a short-term cyclical sense in New Zealand, but at very very least the PM is gilding the lily.   Perhaps you might think that is her job, and on a bad day I could share the cynicism, but we really should expect something better from people who hold office as leaders.

But her own summary is this

Ultimately, we have a positive story to tell, including to investors, and one of my consistent messages is that we are a stable, reliable  investment option, with plenty of success stories. Now, domestically, we  all need to act like it.

I’m right, you are wrong, get with the message.   Or so it seems.     And, yes, we do have a fair measure of political stability –  no Brexits, no civil wars etc, no impeachment hearings (just the ongoing stench of the political donations scandals) –  but that doesn’t markus out from most advanced countries, those that have been performing pretty strongly –  actually securing the productivity gains on which so much else rests –  and those, like New Zealand, that haven’t.

The next section is headed “Govt doing its bit”.  Here there is a lot about capital investment

It won’t surprise you to hear me say – infrastructure, infrastructure and infrastructure. There’s no question that we have a range of deep policy issues to address as a nation, but unless we get the basics right of providing decent housing, transport and health and education services, we’ll only compound those more complex issues. That’s why the Government’s Economic Plan, which you will have heard many Ministers talk about, is designed to build an economy that protects and improves the living standards and wellbeing of all New Zealanders through ensuring we get those most basic fundamentals right.

That’s why we are investing record amounts in hospital and school building programmes – including the fact that in our first two Budgets we’ve invested $2.45b into upgrading and building new hospital and health facilities- that’s twice as much as the previous government managed in nine Budgets – alongside large investments in transport safety, regional roads, and public transport, and we’ve done that while maintaining a responsible budget surplus.

“The Government’s Economic Plan“: that’s a good line.  I hope it got a laugh.  But perhaps the audience were more polite than that.  Infrastructure?  Well, shame about the roads that aren’t getting built, even as the population grows rapidly.  And here is another chart from the annual national accounts, showing general government investment spending as a share of GDP.

govt GFCF

Nothing startling about spending in the first full year of this government.  But perhaps it will be different in years to come.

And then the empty boasts about housing

Not to mention our comprehensive plan to fix the housing crisis which includes delivery of: more state houses than any Government since the 1970s, banning offshore speculators, expanding Housing First to end homelessness, a $400 million package for a progressive home ownership scheme, and making saving for a house deposit easier by lowering the deposit required for a Government-backed mortgage or first home grant from 10 per cent to five per cent. These are real, tangible, things that will help New Zealanders and their families.

“Comprehensive plan” and yet not a mention of the only thing that would make a durable, substantial and sustainable difference, lowering prics of houses and urban land, land use reform.  Allowing people to borrow 95 per cent LVR loans – even as her Reserve Bank keeps on LVR restrictions on private credit –  is at best papering over the cracks of the failures, chosen, of successive governments, including her own.  But give her credit for consistency:  Labour leaders (whether Little or Ardern) have never been willing to champion serious land use liberalisation.

A little further one and we get this recapitulation

Ultimately, this [Infrastructure Commission report] should all be sending two really strong signals. That we are planning for the future and that now is the time to invest. New Zealand is doing well and there are enormous opportunities if we act now. The best thing for the NZ economy at the moment is optimism, planning and investment action. We’re doing some pretty heavy lifting to shore that up in terms of spending and infrastructure investment, the RBNZ is doing its bit with record low interest rates – the private sector needs to ensure it’s on board too.

But, our economy (a) isn’t doing that well (see above) (b) and firms –  people with shareholders’ money on the line clearly aren’t seeing “enormous opportunities” to invest, either now or (in fact) for decaders past.  If it were otherwise now then, all else equal, interest rates just wouldn’t be this low –  as a macro 101 reminder to the PM, interest rates are low because demand for resources at any higher interest rates would be even weaker.

But the PM enjoins us to “only believe”, to join some sort of cheerleading squad building castles in the air.

In fact, one of my staff members asked an economist earlier this week to sum up the economy in one sentence and was told – “it’s ready for lift-off”.  I could not agree more.

Perhaps there is such an economist.  Perhaps he/she doesn’t even work in DPMC/PMO. Perhaps there even will be a bit of a recovery next year.  But just nothing suggests this economy is “ready for lift-off”.  The basic imbalances and severe structural problems haven’t been addressed, haven’t changed.

She goes on.  There is the claim

we have laid out a clear agenda. Yes, it includes change, but by now you’ll all know what that agenda entails and how we’ll deliver it.

Somehow, I suspect the farmers angsting about the current water proposals don’t see it that way.   And the government might have passed a Zero Carbon Bill, but (whatever its merits) it involves almost no substantive certainty about anything affecting business.  Do we know what is happening about Fair Pay Agreements?  And so on.

The speech goes on into a variety of other areas.  The last I wanted to comment on was this –  something to look forward to next week

Today I am also able to provide you with some insight into an upcoming announcement for the Forum. On November 25 the Forum will publish its Strategic Assessment of Future of Work Priorities. This presents four initiatives as priorities:

  • The first is Industry Transformation Plans which will ensure we add value to key sectors of our economy and leverage new opportunities. These plans – for the food and beverage, digital technology, forestry and wood processing, and construction and agritech sectors will describe an agreed vision for the future of each sector, and set out actions required to realise this vision.

(So actually, some of the “clear agenda” isn’t laid out yet, but will be next week?)

Presumably the Prime Minister takes this stuff seriously, but really who supposes that a bunch of central planners, bureaucrats and their corporate equivalents, are really likely to come up with anything useful in these “industry transformation plans”.  Haven’t we had numerous such plans before, stretching back many decades, and precisely what useful has come of them?    Market economies just don’t succeed with “agreed visions” across government and the upper tiers of existing industry players, but by competition, trial and error, creative destruction, unexpected discoveries…..all supported perhaps by governments willing to do what it takes to put a supportive overall policy environment in place.   Our goverment, much like its predecessors, is all too fond of the status quo, and unwilling to –  probably uninterested in –  getting to the bottom of why that continues to produce such mediocre economic results.

As a hint, the real exchange rate –  a key relative price that never seems to make it to the PM’s upbeat economic speeches –  remains well out of line with what you might expect for a country with such a disappointing long-run trade and productivity record.  It might be consistent with that performance, but simply isn’t consistent with delivering something much better, that “productive and sustainable” mantra ministers always keep reciting, while never doing anything much to bring about.

I guess Prime Ministers feel the need to spin, perhaps especially those who aren’t willing to do much substantial.    But it is a shame there isn’t a lot more honesty about the underwhelming state of the New Zealand economy and the reluctance of our policymakers and their advisers to do anything much about changing it.  Sheer spin might get a good headline in the next day’s newspaper, but longer-term it just feeds the growing cynicism about politicians and the political process.  It is cheap, has some short-term sugar-high effect, but is pretty deeply corrosive.  Why take seriously anything they say?

Unserious defenders of NZ national interests

Our government finally made sufficient obeisance and secured a modest upgrade to its preferential trade agreement with the People’s Republic of China.  That included New Zealand agreeing (page 4) to take twice as many PRC-funded ideologically pre-screened Mandarin Language Assistants in our schools (rather than, say, properly funding language learning in schools ourselves).   The values-free cheerleaders for New Zealand deference and subservience to Beijing were all out praising the deal, and if the shameless National Party trade spokesman Todd McClay –  the one who last year was defending the PRC brutality in Xinjiang as being no more than a few vocational training schools and really none of anyone’s business –  was a bit carping and critical, he and his party were probably only critical that the current government does not (quite) do the full kowtow (they did actually sign that 22 country letter on Xinjiang, even if not one of them –  not an official, not a Minister, certainly not the Prime Minister –  will say a word about it).

Remarkably, for a pretty secretive government, sometimes one gets more coverage from the PRC government side than from our own.  The PRC Embassy here often has interesting statement or commentaries on its website.  There was such a commentary this week about the Prime Minister’s meeting with Li Keqiang in Thailand, including the prefential trade agreeement update, although for some mysterious reason I couldn’t see it on the PRC New Zealand embassy website but only on the PRC US embassy website.

Two lines caught my eye. There was this from the Chinese side

The Chinese side is committed to creating a market-oriented, and law-based international business environment, and hopes that the New Zealand side will create a level playing field in New Zealand for Chinese companies to invest and start business.

(One might scoff at the first half of that, but my interest was the second half)

and this describing the New Zealand government’s response

The New Zealand side is willing to provide a non-discriminative environment for companies from all countries investing and starting business in New Zealand.

Others noticed it to.  Here was the Executive Director of the China Council, the government/business propaganda arm of the New Zealand/PRC relationship

Pretty predictable (anything for the PRC, if only we – they – can get some more deals in the short term, is pretty much the China Council stance), but pretty unfortunate too.

The government is, or at least says it is, reviewing the Overseas Investment Act.  It was September last year when they issued terms of reference for the review.    There was a consultation document released in April this year, with a very short period for submissions, because –  according to the Cabinet paper released under the OIA – they wanted to ensure they had legislation passed this parliamentary term.  And yet here we are, now getting on for mid-November and nothing more has been heard.  They don’t seem to have even published the submissions yet.

National security was one of the dimensions covered (albeit superficially) in the consultation document.    Now ‘national security’ is one of those catch-alls that can be grossly abused –  see Trump’s grounds for steel tariffs on Canadian imports –  but the fact that it can be abused does not change the other, rather more important fact, that national security is an important issue, there are real threats (actual/potential), and one of the key roles of any government is to protect national security.    And, on the other hand, business interests have no particular concern for national security, especially if it gets in the way of their activities.

The worry here –  as the Prime Minister’s commitments are reported by the PRC –  is that neither does the government.    We seem to have governments more interested in enabling New Zealand businesses abroad, than in protecting the security, values, and integrity of New Zealand.

I generally have a pretty open approach to foreign investment.  It is often economically helpful and generally mutually beneficial.  Among firms and individuals from free and open societies, sharing similar values, and where companies are free to pursue their interests not those of their governments that is a pretty strong starting proposition.  Perhaps even more so when it involves investment from companies in countries near the frontiers of economic performance and productivity.  Personally, I’d favour removing pretty much all restrictions on such investment from abroad (perhaps preferably reciprocally, but the benefits to New Zealand mostly arise from opening up ourselves –  rather like removing all New Zealand tariffs (something successive governments refuse to do) would benefit New Zealand consumers).

I wrote about this briefly some months ago when I was lodging my own submission to the Overseas Invesment Act review, including how we should think about investment from the People’s Republic of China  and why treating all countries similarly simply does not make much sense (since neither the opportunities nor the risks are the same).  Here is what I wrote then

These days, New Zealand does not get much foreign direct investment –  and especially not much in the way of greenfields new developments.  I don’t think the screening etc regime is the main reason –  mostly, I suspect, we don’t have that much foreign investment because (a) there are few opportunities here, and (b) for the same sorts of reasons business investment generally has been weak for decades (high cost of capital, high real exchange rate, high taxes on business profits –  in that case, especially for foreign investors).  But I’d generally favour a more liberal environment, for almost all industries and for investors of almost all countries.

It is also worth recognising that most of any benefit (to productivity in New Zealand for example) from foreign investment will come from investment by firms based in rich and advanced countries.  Of course, there might be rare exceptions –  a firm based in Zambia, Laos or El Salvador –  but they will be exceptionally rare (the best ideas, technologies, management systems etc) will be in the rich countries –  part of why they got, and stay, rich.  So I’d favour a pretty-much open slather approach to foreign investment –  existing assets or new –  for investors based in rich countries (the OECD membership might be a decent starting point, and one could add in places like Singapore and Taiwan.

For most of the poorer or smaller countries, I really don’t care much what the rules are.  Probabilistically, there is almost nothing at stake (at least in economic terms) in maintaining restrictions on Zambia, Laos, El Salvador (or 100 others) if that is what the political process demands.  But, equally, there isn’t much risk or downside to opening up to them either, especially if one is focused on the benefit of New Zealanders being (generally) able to sell to the highest bidder.

There are various odious regimes in the world.  Most them don’t matter much to New Zealand at all (thinking places like Equatorial Guinea).  But the PRC does and in my view we should –  while the regime remains as it is – be treating investment from there quite differently, for various reasons.    One is a straightforward economic one.  Almost any large PRC firm is either an SOE or has a significant element of state/Party control to it.  We spent years here trying to reduce the hand of the state in direct business operations in New Zealand.  State entities typically don’t run businesses well, don’t allocate investment efficiently, and so on.  There is no more likelihood (to put it mildly) that PRC state-controlled companies will do so than the New Zealand government ones will –  and at least the New Zealand government ones are ultimately answerable to New Zealanders.  Such investment is likely to be a net negative for New Zealand even if the price paid to the initial New Zealand vendor is higher than that vendor could have got from another –  private –  purchaser, whether from New Zealand or another country.

But the deeper reason is that the PRC is a big and powerful totalitarian state, that has repeatedly displayed aggressive intent, which has values antithetical to those of most New Zealanders.   Individual PRC buyers may well be perfectly decent well-intentioned people –  as plenty of 1930s Germans were too –  but a totalitarian state has, and repeatedly demonstrated, its leverage over its own people, by fair means and (too often) foul.  We would simply be ill-advised to allow PRC-associated interests to have significant investments in many sectors in New Zealand.  One could think of media or telecom companies, or tech firms.    The PRC banks operating here should be a matter of concern, especially if they get materially larger than they are now.   But the concern should range wider.  For example, the greater the control PRC interests have of elements of the dairy industry, the more difficult New Zealand might find it to be handle the sort of economic coercion the PRC has attempted to engage in re various countries in recent years.

And, of course, to circle back to my earlier point, it is not as if the PRC is one of the world’s advanced economies.  Productivity levels languish far behind even New Zealand’s modest levels, and everyone recognises the dependence the regime has had on industrial espionage.  Deep pockets aside –  with a mix of market and non-market motives –  how much genuine benefit to New Zealanders is there likely to be from PRC foreign investment over time?

It is possible that this sort of restrictive regime could come at some economic cost, in terms of lost productivity opportunities for New Zealand. My sense is that it would probably be quite a small cost, but we can’t be sure.  Perhaps more importantly, many precautions have a cost –  whether it be a national defence force, Police, anti-virus software, or a lock on your front door.  The PRC is a threat to New Zealand and countries like us, and we need to be willing to spend some resources (perhaps sacrifice some short-term opportunities) to establish some resilience to those threats.

But, of course, our elected “leaders” and business establishment figures have no interest in any of this.  For them, it seems, the character of the regime matters not a jot, it demonstrated track record at home, abroad, and in New Zealand matter not a jot.  There are deals to be done, donations to be collected, and  –  if there are any risks –  well that will be someone else’s problem another day.  And in the process they’ve allowed our political system to become corrupted, indifferent to the character of the regime, indifferent to the values of New Zealanders.  But their “friends in Beijing” are no doubt happy.

I didn’t post a link then to my short submission, but I will do so now.

Submission on. reform of Overseas Investment Act May 2019

Some excerpts.  First, the liberalising proposal

As a general proposition, I suggest that the government should look at a model which more clearly distinguishes between countries which, broadly share similar values, interests, legal systems and approaches to business and remove all (or almost all) restrictions on foreign investment originating from such countries. A starting point for such a list might be the OECD countries plus Singapore and Taiwan. If the beneficial owners of a potential investor are predominantly from these countries, it isn’t obvious that the net benefits from screening would outweigh the costs, including deterrence of investment, of such a regime. Much of world cross-border foreign investment originates from these countries (and the countries at or near productivity frontiers are included in this group), and to the extent that there are prospective economic gains from liberalising the regime, those gains are likely to arise in respect of these countries.

And on the other hand

And at the other end of the spectrum should be a small list of named countries from which we should simply not welcome foreign direct investment, and where the presumption should be against granting approval for any but the smallest and most innocuous of investments. Such a list might include countries subject to United Nations sanctions (notably North Korea), mostly for global good-citizen reasons, and membership of the list might change over time – Germany might have appeared in the late 1930s, the Soviet Union and its satellites during the Cold War – but the key country that should feature on any such list today would be the People’s Republic of China.

In other words, the issue is not specific countries for all time, but specific assessments of the character of regimes, their control over business, and the nature of any threat.

The consultation document makes every effort to be neutral as between countries. But that is a mistake. It is right to recognise that the source of potential threats can change over time, but unless the government is willing to openly confront the nature of specific potentially-threatening countries, it is difficult to build a regime that will serve well both the national security and economic interest imperatives, and provide a clear framework for potential investors (and potential vendors).

What of the PRC?

The issues around the PRC are twofold. First, many of the larger potential foreign investors are state-owned enterprises (or state-controlled ones). We moved to reduce the role of state-owned companies in our economy, for good sound efficiency reasons, and we should establish a presumption in our foreign investment regime that foreign state-owned enterprises (especially ones that cannot operate at a genuine arms-length from government ownership/control) are unlikely to offer potential efficiency gains for the New Zealand economy. And second, because the People’s Republic of China is a regime (a) in which no one can operate fully at arms-length from the authorities (Party or state), (b) has a demonstrated record of not operating as a market economy, (c) shares almost none of the values of New Zealanders, and (d) represents a clear potential threat to the integrity and security of other countries, including in any future period of conflict. The fact that there may be many good, well-intentioned, investors from the PRC should simply not be relevant here, any more than the presence of decent well-intentioned Germans in the late 1930s should have left countries relaxed about German foreign investment at the time. The issue isn’t the individuals, but the authorities to which they are subject.

The risks around foreign investment from the PRC are not restricted to more-obviously sensitive assets (eg major media outlets or telecommunications systems) but apply more generally, partly because of the importance of PRC state-sponsored industrial espionage, but also because of the pervasive use by the PRC system of all sorts of potential sources of influence or connection. For example, vertically-integrated production and supply chains (including in the dairy industry, or the tourism sector would more difficult to withstand PRC attempts at economic coercion of the sort seen in various other countries in the last decade Investment from PRC sources represents a different and, generally, much more severe set of risks than that from Singapore, South Korea, Ireland or Canada.

More generally

The issue can be thought of in terms of a 2×2 matrix: there are benign countries large and small, and more troubling countries large and small. It is the larger and more troubling countries our restrictions should be focused on, and with regard not just to the current situation and immediate threats, but to maintaining resilience over, say, a 10 or 20 year horizon.

And to revert to the PRC

It is possible that such a near-complete ban on PRC-sourced foreign investment could come at some – likely modest – economic cost, the character of any such cost should not be seen as much different in kind to the price we pay for national defence and security systems. Without that expenditure, private consumption could be higher now – and potentially for decades to come – but we choose not to take that option because the recognise that there are risks and threats.

In this, as in other areas of public life, we shouldn’t be afraid to name the potentially hostile state and act accordingly, even as we would welcome such a state back into the fold when if the character of the regime changes. Germany and Japan were once our greatest threat, and are now close allies. They changed their regimes, systems, and strategic intent. When and if the government of China does, we should welcome foreign investment from there, commensurate with the values and practices of the new system. For now, however, we allow our system and society to be corroded from within to the extent we open our economy to significant PRC foreign investment, whatever the apparent short-term gains to individual vendors might be. It isn’t, by any means, the only (or perhaps even most important) set of PRC risks and threats but it is the one that is the subject of this consultation.

Businesses won’t care.  Governments should.  Ours appears not to.  The focus always –  be it on defence, the political system itself, or whatever (foreign investment, Confucius Institutes) – seems to be to minimise the issues, do as little as possible, try to pretend to the public there really isn’t an issue or potential threat at all.  That is pretty shameful and inexcusable.  That is our Prime Minister (and, of course, her chief rival has form suggesting that if anything he’d be worse on this score).

Talking of long-delayed inquiries, the Justice Committee’s inquiry into foreign interference –  the one the government didn’t want to open for public submissions at all –  has still not reported, and no reform legislation has been presented to Parliament either.   The big issues here are less about legislation than about will and mindset.  But again all the evidence points in the direction of big political parties preferring to minimise the issues to the very greatest extent possible.  Jian Yang, and the National and Labour Party “friends in Beijing” will be happy.

Lighthouses warn people away from the rocks

In a few weeks time Christians will begin to mark the season of Advent.  One of the texts often read in liturgies in that season is from the prophet Isaiah.

The people walking in darkness have seen a great light; on those living in the land of deep darkness a light has dawned.

At The Treasury yesterday, a visiting academic proposed such a vision for New Zealand’s place in the world, as the Pharos state.

Bernard Cadogan is a New Zealander now living in Oxford.  According to his bio

Dr Bernard Cadogan has his doctorate from Oxford University on Empire Studies and constitutional theory. He served Hon Bill English (1996-1999, 2005-8), the National Party Opposition (1999-2003), Hon Trevor Mallard (2003-5). He lives at Oxford UK with his wife and three children.

He was also, apparently, a foreign affairs adviser to Bill English in the latter’s brief stint as Prime Minister and has been a consultant to The Treasury on various occasions and issues.  He is formidably well-read, very fluent, often stimulating….and yet, so it seems to me, much better on history than on contemporary politics/policy, and really rather at sea when it comes to economics and economic policy.

I thought I’d written about his previous, extraordinary, Treasury guest lecture in 2016, given just a week after the Brexit referendum (a topic on which he had been providing consultancy services to Treasury), but it seems I never got round to it.    My notes record talk of “pogroms by ballot box”, of an EU that is “virulently alive” while there is “something dead in the British Isles”, comparisons with the Glorious Revolution of 1688, a summary remark along the lines of “darkness won: the fog has rolled back in”, the Brexiteers as “sons and daughters of the counter-enlightenment”, depriving young people of “a second European homeland so that some might have a Narnia”, and so on.   As it happens, the text of that earlier address is still on Treasury’s website –  which enables me to quote in its full “glory” this quote, only the gist of which I’d managed to jot down at the time.

Irrational romantic nationalism and the archaic narratives of historians and of the nationalist culture industry have prevailed over rational economic argument. Grub Street and Grub Street politicians from “Spectator-land”,  with the prose skills of another era, have worsted the experts and the technocrats, and rendered nugatory the best quantitative techniques.

You get the sense that Dr Cadogan wasn’t very keen on Brexit.

In yesterday’s address there was none of that tone at all.  It was quite a remarkable transformation, especially when Brexit still hasn’t happened –  if I heard correctly that might have something to do with consultancy services Cadogan is now offering to parts of the UK government.  But it seemed to be there by counterpoint, in his theme that in this troubled and turbulent world

Throughout his talk Dr Cadogan uses the image of the great lighthouse of Alexandria to represent New Zealand’s personality in global affairs, as a source of hope and comfort to countries and peoples sailing turbulent waters.

It was bringing to mind more of Isaiah

40 Comfort ye, comfort ye my people, saith your God.

Speak ye comfortably to Jerusalem, and cry unto her, that her warfare is accomplished, that her iniquity is pardoned: for she hath received of the Lord‘s hand double for all her sins.

The voice of him that crieth in the wilderness, Prepare ye the way of the Lord, make straight in the desert a highway for our God.

Every valley shall be exalted, and every mountain and hill shall be made low: and the crooked shall be made straight, and the rough places plain:

It was, and is, more than a bit of a mystery as to why anyone much –  at least in the advanced world –  should look to New Zealand for anything, let alone “hope and comfort”.  Cadogan never did address that point, apart from some quick passing reference to questions he gets abroad –  presumably from people within his own ideological bubble – about “how does New Zealand do it?”.  “It” here also never being defined, but I presume it had something to do with the popular adulation, in a few quarters abroad, for our current Prime Minister (shorn of any actual policy programme).

The lecture began with a painting by Nicholas Poussin in which the (small) servant Cedalion guides the giant Orion towards the sun, and healing.  Small nations may, Dr Cadogan asserts, have special powers –  at least if they can avoid getting stomped on by giants.   And New Zealand….oh New Zealand,

  • that radical democracy (the “most radical”)
  • exemplary in so many respects
  • admired for our democracy, values, responsibility, human rights, decency
  • a successful market economy,
  • excellent institutions,
  • where the Treaty of Waitangi combines utopianism and justice,
  • and where there is no hatred, no contempt, no ideologues (he seemed particular exercised here about some UK former junior minister, now ennobled as Lord Freud).

(He claimed that Henry Kissinger had once said that law was New Zealand’s greatest gift to civilisation. I’m not sure if someone was getting confused with Solon, or even Coke or, say, Blackstone.)

We, in Cadogan’s view, have a story to tell the world, we could be a “moral realist” “force multiplier” to the world.

There have been times in our past when a good number of serious people abroad have looked to New Zealand as some sort of exemplar.  Like them or not, the reforms of the Liberal governments in the 1890s attracted many visitors and attempts to explain the New Zealand story over the next couple of decades.  Probably not entirely unrelatedly, New Zealand was also among the handful of most prosperous places on earth.

There was a somewhat similar effect in the wake of the reforms of the late 80s and early 1990s.  Like them or not, they were adopted with energy, verve, vigour, rigour and with some genuine innovation. By this time, people –  here and abroad –  knew that New Zealand had fallen well behind (economically, and in terms of what a strongly performing economy could offer) and the reforms were some sort of beacon of hope, that would put New Zealand back on a high-performing path.  You still find the occasional residue of that sort of sentiment –  although mostly from people who haven’t looked at any data for the last 25 years.     In that period there was, at least among some on the left, some admiration for the New Zealand ban on nuclear ships –  some genuinely hoping that it would show the way to other countries (typically it didn’t).

But quite what are we to suppose that people –  elsewhere in the advanced world – should look to us now and admire or envy?  I’m at a loss.  A questioner in yesterday’s seminar pointed to the disgrace that is our housing market, the rise of homelessness etc.  I’d, of course, frame the issue more broadly, and highlight our continued relative economic decline.  In 1900, you might have missed great art and architecture, museums etc if you came to New Zealand, but at least average incomes would be as high as on offer anywhere.  Now, you face distance, a pretty thin representation of the best of our civilisation, and you get to be materially less well-off than you’d be in most other advanced countries.   Are we “leading the way” on climate change, or any other left-wing causes?  Not that I’d noticed.   No doubt there are niche areas where New Zealand people are well-regarded (one hears it re trade negotiations, but then again why not unilateral free trade?) and few people are ever likely to express much angst about New Zealand (a threat to no one).  But a light to the world?  Really?  Who is looking?  Who cares?  Where, for that matter, are these “values” Cadogan talks of –  none that are admirable on display re the PRC (and for a lecture supposedly on geopolitics, there was almost no mention of China).

Another questioner noted that for all Cadogan’s praise of our democracy, actually there were few checks on the executive, great concentrations of power, and little effective accountability.  It more or less stumbles on, but to what end?  And how resilient would it prove to be if really put under pressure?  The questioner might have added specific points about how weak the media generally is, the limited range and poor quality of much of the public debate, the weak role academics and think-tanks play here, and the degradation of the capability of the upper reaches of the public service.

Yet another sceptical questioner –  Prof Girol Karacaoglu from Victoria University –  noted that for all Cadogan’s talk about New Zealand exceptionalism, he (Karacaoglu) was reminded of a line from a book he’d read –  John Gould’s  The Rake’s Progress – soon after coming to New Zealand 40 years ago, suggesting that things in New Zealand both good and bad tended to follow, perhaps 15 years behind, trends from abroad.

Are there valid points in what Cadogan was saying?   Yes, although some probably don’t carry much substance.  Are we a great power or a small player?  A small player.  Ever was and probably ever will be.  Do small countries survive the rise and fall of great powers?  By and large, yes.   And are there areas in which it is more likely that we can learn from other small countries –  and perhaps work effectively with them – than from very large countries?  No doubt.

Cadogan urges a peripatetic “colloquy” of small countries –  he listed Norway, Sweden, Finland, Denmark, Netherlands, Portugal, Switzerland, Ireland, Australia and Canada (the latter two far from small) and “perhaps” Uruguay.  This grouping could, he suggested, learn from each other.   It is hardly a new idea, and of course in many areas of policy there are just such groupings (eg a “small inflation targeters” grouping of central banks).     But it wasn’t really obvious what New Zealand had to offer or –  at least on some key issues –  learn.    Our strategic position is very different from almost all these countries.  Which is a variant on the point that our geography is very different –  incredibly remote –  and there are few/no relevant national comparators (and not very encouraging subnational ones) when one contemplate the implications of that remoteness.    Perhaps Uruguay fits the bill, but for all its relative success in the last decade or so, it remains materially poorer and less productive –  with less of a record of political or economic stability – than New Zealand.

Cadogan seemed very taken with Ireland –  he’s an Irish citizen too apparently – but showed no sign of appreciating that for all of Ireland’s exaggerated GDP per capita, once you look at the bit of economic activity benefiting the Irish people, Ireland’s story (prosperity) is nothing out of the ordinary: it is a fairly prosperous (but not first rank) European economy, and if there are lessons for New Zealand they are mostly about what we can’t do (not being a short distance from hundreds of millions of other very prosperous people).

There was upbeat talk about what a difference a New Zealand Nokia –  a big brand signifying New Zealand –  might make: Cadogan saw such a brand as a “sports lifestyle” one that would “walk through the walls that ideology imposes”.  Perhaps, but isn’t this just wishful thinking?   A bit like the talk, inspired by mention of the top Swiss universities, of what a difference it might make if New Zealand had two really good universities, one in sciences and one in humanities.  And yet, starting relatively poor and very distant, there was no hint of how this alternative world might come to be.

There are plenty of places in the world worse than New Zealand. But the notion of the world –  advanced world –  looking to New Zealand as some sort of lead, exemplar or guiding light seems little more than ludicrous in our current diminished state.    If anything, we might be a bit of an embarrassment –  the nice little country, that did so many reforms, and yet look at them now, still drifting  ever so slightly further behind, without even a political system or civil society to insist on something better, to set a different course.  And so remote that we don’t ever matter much to most of the rest of the world.  Sure, we don’t have Donald Trump –  but, fortunately, neither does anyone else.     But we have a (former?) CCP member, former member of the PRC military intelligence system in Parliament (chairing a Select Committee no less), and no one in the establishment here says a word –  at least in the US there is disquiet, and more, about Trump.

Lighthouses –  grand or otherwise –  warn sailors off rocks.  I noticed in the NZ History Twitter feed that yesterday was the anniversary of a dreadful maritime disaster here in 1894 (one of the two or three worst days, per capita, for the peacetime loss of New Zealanders in history) –  no mention of a lighthouse in the write-up.  If New Zealand is any sort of lighthouse to the world –  on these rocks pointed at the heart of Antarctica –  it is perhaps in the form of the salutary lesson: don’t do as we did, don’t end diminished as we now are.

Fluent and stimulating as Cadogan can be, it might also be a bit more encouraging if our Treasury itself showed signs of leading the way towards a much better-performing economy.  Perhaps we never again can lead the world –  as we were doing 100 years ago –  but whether it is economic policy, housing, or just the quality of our diminished government institutions themselves, we have to be able to do better than we are now.

 

On the anniversary of the CCP seizing power

It is 70 years today since one of the dark days of the 20th century, when the Communist Party seized power in China, and renamed the country the People’s Republic of China –  rather better surely would have been Party’s Republic of China?

Of course, there were a fair number of dark 20th century days, mostly associated with one or another of the totalitarian regimes.  But when thinks of the CCP one can combine (a) the number of people in China, (b) the length of time the regime has persisted, and (c) the very great evils the regime has visited on its own people (and others).  I’m not going to argue it was necessarily worse than when the Nazis came to power in Germany: tens of millions then lost their lives, but the regime was gone again in little more than 12 years.  Or than the Communist Party coming to power in Russia, which opened the way to all manner of Communist regimes, including in China, as well as the brutality and depraved indifference (mass starvation) and loss of freedom visited on its own people and others.   On a smaller (but still large) scale the Rape of Nanking and the Japanese invasion of China would be up there.  But as a marker of evil in our world, 20th century (and now 21st) style it is a low that is hard to beat.    Absolutely dreadful as Rwanda in the 90s, Cambodia in the 70s, various other ethnic cleansings, and even the dropping of the atomic bomb. were, those were all shortlived (mercifully) and affected a handful of people by comparison with the PRC and the Party that controls it.  After all, almost 20 per cent of the world’s population lives under this particular longrunning tyranny.

And yet among too many of the “elites” in our society – whether elected or not –  that doesn’t seem to be the take on the PRC at all.     The PRC model might not be the one they’d want for their own children, but the fact that hundreds of millions of others live under such a regime (tens of millions more either starved by the depraved indifference of the regime, or murdered by the forced abortion policies of the regime) bothers them not in the least.    It isn’t just New Zealand, of course, although all indications are that our “elites” have lost of any sort of moral or values-based perspective on the PRC regime to at least as great an extent, probably more so, than so-called leaders in many other Western countries.  After all –  and not the worst of it – they tolerate a Communist Party member and (former?) member of the PRC military intelligence system in our Parliament, not as some rogue independent, but as a (recently-promoted) member of our largest political party.  And worse, so we are told by a well-connected person, they are so lacking in any decency or moral seriousness, they make light of the fact.

spy

Meanwhile, other parties in Parliament make nothing of this, and so become complicit.

Around the world, all manner of well-known, powerful or influential people in recent weeks will have been invited to functions, hosted by PRC embassies, to mark the beginning of the CCP tyranny.  Others –  people in embassies in Beijing –  will no doubt have been invited to this afternoon’s lavish military parade.   You’d suppose that decent, honourable, people would simply say no.  I’m not suggesting our authorities should have no relations with the PRC but an invitation to such an event in New Zealand might have been met by sending along, for as short a period as decently possible, a mid-ranked MFAT official.

Somewhat to their credit, the PRC Embassy in New Zealand maintains quite a useful website, with speeches and articles that typically tell one more than would ever be secured from the New Zealand side of such exchanges.    Last week there was a big reception, hosted by the Ambassador, at Te Papa to mark the Communist takeover.   The “great and the good” (well, I’ll use the label, even if there is no substance to it) seem to have flocked to it.

On September 24th, the Chinese Embassy in New Zealand held a reception to celebrate the 70th anniversary of the founding of the People’s Republic of China at the Museum of New Zealand Te Papa Tongarewa. Over 500 people attended the reception, including the Acting Prime Minister and Foreign Minister Rt. Hon Winston Peters, the Minister for Ethnic Communities Hon Jenny Salesa, the Acting Secretary and Deputy Chief Executive of MFAT Bede Corry, the Deputy Secretary of the Americas and Asia Group of MFAT Ben King, heads of major government departments and members of parliament, well-known members of the wider community in New Zealand, members of Diplomatic Corps, overseas Chinese, representatives from Chinese institutions and international students.

I’m not holding it against resident PRC citizens that they would attend such an event –  it might not have gone well for them or their families had they declined.  But what of all those prominent New Zealanders, from the acting Prime Minister on down?  Not one of them had to attend.  Every one of them made a choice to do so, a choice that said that what the regime stands for – and has stood for over the decades – didn’t matter to them one bit.    Perhaps the PM herself would have gone if she hadn’t been extolling –  emptily, as this occasion demonstrates –  the idea of a values-driven approach to policy and international affairs?  The acting Prime Minister is photographed standing with the Ambassador, unbothered (apparently) that she represents the latter day manifestation of something like the Nazi Party ca 1938.

(There was another such function in Auckland, with only a slightly less ‘distinguished’ attendance list, including such people as the National Party president, the Mayor of Auckland, and Don McKinnon, all known for their deference to the regime in Beijing.)

We are told that a Deputy Secretary of MFAT gave a speech on behalf of the New Zealand government (less bad than the Minister I suppose).    According to the embassy

MFAT’s Deputy Secretary of the Americas and Asia Group Ben King delivered a speech on behalf of the New Zealand Government, extending warm congratulations on the 70th anniversary of the founding of the People’s Republic of China.

How many tens of millions of dead would it have taken for Mr King to have found a conscience and either refused to speak or spoken out (career-limiting of course) to regret the founding of any tyrannical regime and this one in particular?  King’s speech doesn’t appear on the MFAT website, but I have requested a copy. I’m sure it will have been cleverly drafted, but not in the way that will avoid the clear immoral choice successive New Zealand governments have made around the PRC in recent times.  Values are things that have a cost, and when it comes to the PRC it isn’t clear that our politicians or officials have any values at all.  There is no sign any price is worth paying ever.  Some, of course, are particular craven in their pandering, their praise, and their lack of interest in the character of the regime (Simon Bridges as just the most recent egregious example).

Communist Party regimes around the world have proved fairly economically disappointing.   In whatever precise form the regime takes, Communism hasn’t proved incompatible with improving material living standards.   The USSR in 1991 had substantially higher material living standards than Russia had had in 1917.   The same goes for the eastern-bloc countries the Soviet Union controlled for several decades –  wealthier at the end than at the start.   Data on Laos is scarce, but no doubt material living standards are higher than they were several decades ago.  Even Cuba, for all it failures, has GDP per capita higher than when Castro took power.      Quite possible, material living standards even in North Korea (which now eschews the Communist label) are better than in 1950.  But what of it?  Almost every country in the world is richer than it was, and yet useful idiots all round the West rush to use the CCP line about how somehow the regime has “lifted out of poverty” many hundreds of millions.

The best simple test of the economic value-add of Communist regime might be to compare the economic performance of Communist countries with non-Communist one with similar cultural backgrounds, similar geographies etc.   The simplest examples, of course, being East and West Germany, and North and South Korea (the north have once been the more advanced part of the peninsula).    But we could, say, compare Austria with Czechoslovakia (until 1918 they were all part of one polity): in 1937 GDP per capita in two countries was roughly similar  but after 40 years of Communism Czechoslovakia (richer than it was 1937) had about half the per capita GDP of Austria.   Or Cuba and Costa Rica –  with pretty similar levels of GDP per capita in the 1950s, Cuba at about 75 per cent of Spain’s GDP per capita, Cuba now lags badly behind.  Or contrast Laos with neighbouring Thailand.  Vietnam with Malaysia.

And, of course, the PRC with Taiwan, Japan, Singapore, South Korea…..well, even with today’s Russia.    Sure over 70 years the material lot of PRC citizens is generally better than it was, but the level of income now lags far behind those other countries.    China once led the world economically, but now –  even after decades of catch-up growth (and some doubts about their data), their average GDP per capita (in PPP terms) is still only just reaching the world average.  Almost certainly, the Communist Party has materially held back the economic development of China and thus the income prospects of the the citizens of the PRC.

Perhaps it would be a little different if Communist rule –  anywhere, let alone China –  had been some staggering economic success.  Then an honest representative of the CCP (is there such a thing?) might reasonably ask whether materially higher living standards than were on offer in comparable, but freer, societies was not a trade-off worth making.  That is, implicitly at least, the situation in Singapore –  not free (although not PRC unfree either) but really rather prosperous, almost up at the global productivity frontiers.  But this is the PRC we are talking about.  It might buy a lot of stuff, including from New Zealand, but it has crippled the economic prospects of its own people, and taken their freedoms in the process.

Yet this is the actual regime ministers, head of departments, and other “leading” citizens have been celebrating:

  •  one where citizens don’t have the vote,
  •  one where citizens have little or no effective freedom of expression,
  •  one where the surveillance state becomes more intrusive by the year,
  •  one that holds Canadian citizens hostage, not for any real crimes, but as leverage against the Canadian government,
  •  one that engages in forced organ transplants,
  •  one that has unilaterally seized and militarised much of the South China Sea, in defiance of international agreements to which the PRC was a party,
  •  one that holds a million or more Uighur people in concentration camps,
  •  one that remains openly determined to absorb free and democratic Taiwan into the PRC, if necessary by invading it,
  •  one that increasingly deprives citizens of any freedom of religion, which might be seen as a threat to the pre-eminence of the Party

and so we would go on, barely mentioning Tibet, state-sponsored intellectual property theft, the absence of the rule of law, or the activities abroad of the likes of Jian Yang, Yikun Zhang, and their counterparts in numerous countries around the world. And it is not as if the regime is getting less tyrannical, more willing to limit the Party’s pre-eminence.

But never mind, there are drinks and canapes to consume, deals to do, donations to secure…….against which the sort of traditional values of New Zealand citizens (including many ethnic Chinese who came here to escape the regime) are set at naught and dishonoured every day, but this day perhaps more than most.

How will history judge these people – our politicians, our prominent business leaders, our journalists who take trips to China and then write PRC-favourable stories, the government-funded propagandists at the China Council, and so on?  Not well, one hopes.  No doubt, they all manage to tell themselves that somehow they have the ‘best interests of New Zealand” at heart and perhaps they even believe it, but they are deluding themselves, and dishonouring all those who value freedom, whether here, in China, or anywhere else around the world.

They shame us:

Jacinda Ardern

Simon Bridges

Winston Peters

James Shaw

Todd McClay

Gerry Brownlee

David Parker

Don McKinnon

Stephen Jacobi

Peter Goodfellow

and so on, including the galaxy of MFAT officials, other senior officials, university vice-chancellors, private business people, much of the mainstream media.

But if it is 70 years today since the CCP tyranny was established, it is also 30 years next month since the Berlin Wall fell and way was opened decisively for the end of Communism in Europe.      Evil regimes don’t last forever.  For the sake of the world, and for the 1.4 billion people in China, we should hope this one ends soon, and give no aid and succour –  or simple encouragement by turning up to share celebratory drinks – to the evil regime and its leaders while they last.

Recalling Jian Yang’s past: questions for him and his leader

It was two years ago last Friday that Newsroom and the Financial Times jointly broke the story of National list MP Jian Yang’s past, as a Chinese Communist Party member and fifteen years spent as a trainer in the PLA military intelligence system.   There was a strong suggestion that he had been removed from Parliament’s foreign affairs committee after the New Zealand security services discovered his past and had drawn it to the attention of the then Prime Minister.    Anne-Marie Brady’s Magic Weapons working paper was released at about the same time, highlighting the extent of PRC attempts to influence, or interfere in, affairs in New Zealand.

A bit more of Jian Yang’s story seeped out over the following few months, including his residency application documents for New Zealand, in which –  so he later acknowledged –  he had actively chosen to misrepresent his past, (so he also told us) on the instructions of Beijing.      There was also rather more confirmation of just how close to the PRC Embassy in New Zealand Jian Yang is and was –  leading one serious government relations type, with a diplomatic background, to go on record stating that he was always very careful what he said around Jian Yang (and Raymond Huo, once again a Labour MP).   The implication –  never stated directly –  was that whatever was said around him might well end up in the hands of the PRC Embassy.  At the time, of course, Jian Yang was full member of the government caucus, and although Cabinets often keeps their own caucuses in the dark about some things, caucus members generally know more than you or I do about what the government is up to, or is thinking.

But after that brief flurry the issue died down.    Labour and the Greens showed no interest in questioning whether someone of that background, never once heard to utter a word of criticism of the PRC, should really be serving in our Parliament.  National closed ranks behind Jian Yang –  not once in the subsequent two years has a single past or present National MP expressed as much as an iota of concern.   And Jian Yang went quiet, simply refusing to talk at all to any English-language media (despite English being the first language of most of National’s voters), but only too happy to talk to quiescent regime-complicit Chinese language outlets.   If you can get away with it –  and have all the morals that must have accompanied CCP membership and service with PLA military intelligence –  I suppose why would you do anything else?  People –  all of us – respond to incentives and –  given his actual background –  simply going to ground and staying there must have looked quite the most attractive option.

Optimists –  naive ones perhaps –  wondered if perhaps National, embarrassed to have been caught out, would gradually sideline Jian Yang and he’d eventually quietly step aside by the next election, perhaps to be replaced with another regime-sympathetic,  well-connected, good-with-the-donors recent migrant, but one without such an uncomfortable back story.

Silly them (well, in my optimistic moments perhaps I was one of them).

For Jian Yang is still with us.  Still not talking to the English-language media (except a few comments in his rather ineffectual service as National’s spokesman on Statistics), still sharing an office in Auckland with fellow list MP (and now National’s Finance spokesman) Paul Goldsmith, recently promoted to chair the (not overly important) Governance and Administration Committee of Parliament, still in business with National Party president (and regime cheerleader) Peter Goodfellow), and……most recently, accompanying Simon Bridges on his trip to the PRC, including that gruesomely awful fawning interview with CGTN (saying what so much of the rest of the New Zealand establishment only support in practice by their silence) and his meeting with Guo Shengkun, the Politburo member responsible for the entire apparatus of repression (“law and order”) in the PRC, including the concentration camps in Xinjiang.   Yes, it was a big week for Jian Yang.  If Simon Bridges wasn’t just regurgitating briefing notes from Jian Yang, he might as well have been.  The Embassy will have been pleased.   Perhaps unsurprisingly, Jian Yang was out in the media (Chinese language only) praising his leader for his praise of the CCP  (Raymond Huo was also out praising Bridges, at least until he deleted the relevant tweet).

And not a peep out of any other political party expressing any concern about Jian Yang (or Bridges).

That tawdry episode –  Bridges abasing himself before the PRC, aided and abetted by their own (former) man now sitting in his caucus –  was a bit much for Daisy Lee, an independent researcher born and raised in the PRC, and now living in Auckland.  (There was some background on Daisy and her husband –  he’d been a Tiananmen Square protestor in 1989 –  in this Sunday Star-Times article.)  Daisy has written an article on Jian Yang and his place in the National Party, and asked if I would run it here.  I helped her with some of the English, but it is her text, her stories, and her challenges to Jian Yang (and, at least by implication) to the National Party.

Of his residency application, she reminds us

In this nine-page document, Jian Yang declared that the whole period from 1978 until 1993, the year he departed for Australia was spent solely at one school, Luoyang University.

But the facts reveal, and Jian Yang later acknowledged, that the relevant certificates are falsely made to cover up his total 15 years with the two military universities, the PLA Air Force Engineering Institute and Luoyang PLA University of Foreign Language. The notarised document in both Chinese and English declares that Jian Yang enrolled in Luoyang University in 1978. But a simple search – Wikipedia or the Chinese Baidu – indicates that that university wasn’t even founded until 1980.

Jian Yang eventually told us that Beijing instructed him to misrepresent his past, but never explained the notarised certificate. It won’t be just anyone who has the authority to instruct a state-owned university to issue a series of false documents just to satisfy a request from an ordinary Chinese citizen. Chinese intelligence authorities perhaps?

It is commonly understood among the Chinese community that an active serviceman in China is not allowed to emigrate overseas, and does not even have an ordinary citizen’s passport.

The sort of thing that should bother the National Party, you’d once have hoped.

Jian Yang seems to spend a great deal of time with regime-sympathetic Chinese in New Zealand.  Daisy asks about others from the PRC.

In the past two years I have seen Jian Yang’s smiling face on his sign displayed on Auckland’s Great South Road. The same smile I have seen in pictures of a number of occasions including him meeting Politburo member Guo Shengkun on his recent trip to China with Simon Bridges, and his visit to the new PRC consul general in Auckland with the National Party’s president Peter Goodfellow in July.

I hope that one day Jian Yang will smile on some other groups from China. Among the Chinese diaspora they include Falun Gong practitioners and human rights activists. They also include the Xinjiang Uyghurs, exiled Tibetans, and members of house churches in China. Most of them fled to New Zealand to escape persecution. Many don’t speak much English and so aren’t easily about to tell their stories to National’s leaders.

Meanwhile, these same people see Simon Bridges and Jian Yang meeting with Guo Shengkun. From a regime keen to suggest to Chinese diasporas that they are not beyond Beijing’s reach, what sort of chilling message must that send?

Even among those with less immediate reason to fear

I could have chosen not to write this article, but the embarrassment of Simon Bridges’ performance in the staged interview with CGTN, the CCP’s English-language mouthpiece, has led me to decide to give Jian Yang a chance.

A chance to stop encouraging and assisting New Zealand politicians like Simon Bridges to worship the brutal regime and people like its representative Guo Shengkun, one of the most powerful figures in the CCP who is responsible for all of the religious and political repression apparatus. To stop praising the CCP. And to stop hiding from the local English-language media, or anyone who might ask awkward questions.

Over the last two to three decades, there have been significantly increasing numbers of Chinese who have moved overseas and the majority of these immigrants are well educated middle class and business people. The main reason for them to leave China is that they hated the corruption, pollution, and suppression which are all the problems caused by the CCP’s 70 years in power.

It is naive to believe pro-CCP politicians can receive more votes from their Chinese constituents for praising Xi and Guo, or for being silent about a brutal regime that continues to corrupt and repress their families and relatives in China.

(Daisy might be right about that, although evidence to date suggests it is a rather good values-free fundraising strategy.)

She ends

The next election is approaching and the public deserve better answers from Jian Yang.

The full article is here.

One can only agree that there are hard questions that Jian Yang should answer.

But personally I reckon Peter Goodfellow and successive National Party leaders (Key, English, and Bridges) are now –  fixed with knowledge – just as culpable, if not more so and shouldn’t be allowed off the hook.  For the earlier leaders, the questions should be along the lines of “what did you know and when did you know it?” and “what steps did you take to ensure that as an MP Jian Yang is operating only in the interests of New Zealand, not those of the PRC?”   For Bridges, why do regard it as appropriate to have a (former?) CCP member, former longserving member of the PLA military intelligence system, who has never said a word of criticism of the PRC or the CCP, and who remains very close to the PRC Embassy as a serving member of your caucus?  Would you be willing to have Jian Yang serving as a minister in a future National government (and if not, why not)?  And so on.    The questions could usefully be extended to all current National MPs, every single one of whom was elected in 2017 (or came in on the list since) knowing they would serve with Jian Yang, and not one of whom has been willing to express even a scintilla of public concern or unease  (perhaps someone has had private concerns, but after this amount of time private concerns count for little or nothing –  as members of Parliament you have a higher duty than to mere “caucus discipline”).

And then, of course, we could extend the questions to the Prime Minister and to the leaders of the Green Party.  Why, for example, have you expressed precisely no concern about this individual –  with such a questionable background –  serving in New Zealand’s Parliament?  And, of course, Winston Peters who did once express some concern, but no longer does so.  Beijing probably wouldn’t like it if he did –  nor, probably, would the Prime Minister.

And, of course, there are the agencies –  MBIE and DIA –  that gave Jian Yang residency and citizenship on the basis of false documents.  Is anything ever going to be done.  If not, why not?

Are there any values that guide our political class around the PRC?   Fear and opportunism don’t count.

There has been a very robust debate in Australia over the last week or so about the regime affiliations of new Liberal backbencher Gladys Liu (lots of extracts from various perspectives here).     Seems to me that although there are legitimate and important questions to ask about Gladys Liu, what has emerged to date raises far fewer questions than Jian Yang’s position should.  And yet the media and the political classes passed over in silence the two-year anniversary of learning of Jian Yang’s background, serving one of the most dreadful regimes on the planet, none of it recanted, even as he himself chose to join his leader in print praising the Party.   They will be happy in Beijing.   Could they have imagined on 1 October 1949 having such a quiescent and compromised dependency in the South Pacific only 70 years later?

The rest of us –  ethnic Chinese and otherwise – should be alarmed, by Jian Yang himself and by those who continue to make space for him to serve in New Zealand’s Parliament consciously choosing to ignore (or even embrace) how compromised he appears to be.

 

Hush, don’t be so explicit

I had a phone call yesterday from someone I respect suggesting that I was going a bit lightly on Simon Bridges over China.  After my post last week, just prior to the Bridges trip to the PRC, I should generally have been immunised against that charge.  But what my caller had in mind was a few tweets where I had suggested that bad –  even despicable –  as Bridges was, especially this week in his interview with the Communist Party-controlled CGTN, actually there was little or no functional difference between Bridges and Labour (in particular) when it came to the PRC.   Tweets like this were what my caller seemed to have in mind

Anyone who hasn’t watched the interview really should do so.   From a PRC/CCP perspective, it must have seemed almost too good to be true.  It came across like one of those staged interviews normal political parties sometimes do with a sympathetic “interviewer” designed to put leader and party in a good light, except that this was the leader of New Zealand’s National Party –  a party that purports to espouse values (freedom, democracy, limited government etc) that mostly look quite good on paper, that once had a clear moral sense of the evils of Communism –  being interviewed by a CCP interviewer who feeds up soft questions (“hasn’t the Party done a wonderful job?”, “isn’t Xi Jinping a great leader?” sort of thing), and Bridges gives back pandering answers better (from the CCP perspective) than even she must have hoped (even recognising the typically obsequious and deferential – craven really – form of NZ political leaders on the PRC).

One could unpick it line by line:  for example, where he seemed even keener than the interviewer to celebrate even the first 30 years of the PRC (perhaps Jian Yang never told him about the Cultural Revolution, the Great Leap Forward, and all the other horrors), his treatment of the CCP as a normal political party, or (only noticed on a second viewing) the sickening way he invoked Winston Churchill –  who actually led the fight against tyranny, and called people to recognise it for what it was –  to pander to his hosts.  But I don’t think any serious observer disagrees that it was extraordinarily bad –  the only competition is how best to describe the spectacle.

The rest of the visit doesn’t seem to have been much better.  He looks to have been desperate to impress his hosts (but they probably already had him marked as a “useful idiot”, after his pandering to Yikun Zhang, protection and promotion of Jian Yang, and his part in signing the previous government up to the vision of a “fusion of civilisations”) and perhaps to look as if he was taken seriously abroad.  How else to explain him agreeing to meet, in the Great Hall of the People, with Guo Shengkun, the member of the Politburo responsible for all PRC law enforcement activities (that includes Xinjiang), former Minister of Public Security?

He must have been briefed on Guo Shengkun’s background – even if Jian Yang thought not to mention it, MFAT surely would have.  But if it bothered anyone around him at all, clearly not enough to say no.   Perhaps the choice of Politburo member was carefully planned by the PRC to see whether Bridges had any limits, any scruples, at all.  They seem to have got their answer.

That all should be good for a few more donations, large and small, to National –  which has shown no interest in higher standards or tighter laws in this area.  Perhaps another dinner at Yikun Zhang’s house?

Bridges has, rightly, been on the receiving end of a fair amount of flak over the interview in particular.  Grant Robertson has been reported as suggesting that in the interview comes across as more devoted than most paid-up members of the Communist Party itself.  Perhaps he too has spent many hours studying Xi Jinping Thought to get his lines right, or perhaps that was just Jian Yang?   It isn’t quite clear how much he is sold-out, value-free vs being simply out of his depth, and not fully realising the significance of what he was doing, who he was talking to, and what he was saying.

And from some academics there was quite a lot of surprised pearl-clutching too.  The director of Victoria University’s Centre of Strategic Studies, David Capie, gasped that it was

Alarming to have such a big gap between govt & opposition views/language concerning such a critical relationship.

And Jason Young –  director of the taxpayer-funded Contemporary China Research Centre – was among those critical of Bridges for his talking up the CCP when the New Zealand practice has typically been to talk about the state (PRC) –  as if the Party didn’t control the state, which works to Party supremacy ends.   Another local academic, never himself otherwise on the record as critical of the regime was moved to observe that “Bridges’ comments re Xi’s China are bonkers”.

(The China Council –  funded by the taxpayer, with eminent former senior Nats (and Jian Yang) on their councils –  ever pretty obsequious themselves, but ever so smoothly, has been uncharacteristically silent.)

I don’t buy it.    And you’ll note that –  search as you like –  none of these academics has been critical of National for its general policy stance towards the PRC, none has criticised Bridges for not speaking up on Xinjiang, on Hong Kong, on the increasingly repression of religion (doesn’t Bridges claim to have a Christian faith?), on the abduction of Canadians, on state-sponsored intellectual property theft, on the South China Sea.  Near-complete silence on the continued presence of Jian Yang –  15 years in Chinese military intelligence, misrepresenting his past on Beijing’s instructions –  in the caucus, and at the right hand of the leader on his PRC tributary mission.

No, what really seems to bother them is that Bridges seems to have let the side down by his over-enthusiastic gush.  Not the done thing old boy.   Created uncomfortable headlines.  Really Simon, don’t you know better by now?   They are embarrassed by this rather amateurish schoolboy effort to pander, rather than having any problem with the underlying policy approach.    That is as true of most of these academic commentators –  Anne-Marie Brady excepted of course –  as it is of the rest of political spectrum, as it is (apparently) of most of the media.  It should count as extraordinary that neither of our main daily newspapers –   Herald or Dominion-Post – has given the story any coverage at all, despite all the questions it should be raising about national security, foreign policy, the place of values in New Zealand policy, and fitness to govern of the leader of the main opposition political party.   Should.  But this is New Zealand.  And we don’t want the peasants getting uneasy about the way the establishment –  all of it –  panders to the PRC now do we.

If there are differences between National and Labour on the PRC they are so tiny, and largely opportunistic, as to be barely discernible to anyone else.  Perhaps National is “better” at tapping the money-tree, but that probably only makes those who run the Labour organisation a bit envious –  after all, there no sign of any leadership from the Prime Minister on the electoral donations issue, whether reforming the law or taking National to task over large donations from PRC/CCP affiliated donors, whether citizens or not.

Both sides like to run the ridiculous line about the great transformation managed in the PRC over the last 70 years –  never once pausing to recognise how poor the PRC economic performance is relative to east Asian peers (Japan, Taiwan, South Korea, Singapore).  Both sides like to pander, suggesting that somehow New Zealand’s prosperity depends on the PRC –  whether cyclically (“saved by China in the GFC”) or structurally.     Both sides like to treat the PRC as a normal state.  Both sides happily hobnob with CCP figures –  only last year, the PM was meeting a senior CCP figure here and talking up better “party to party exchanges”).   National and Labour figures got together to honour Yikun Zhang, for what were really services to Beijing.     Neither side will say a word in public about any concerns about PRC gross human rights abuses –  a term which really diminishes the outrages perpetrated daily in Xinjiang –  or an expansionist unilateralist foreign policy.  Neither side seems to have a problem with NZ Police having friendship and exchange agreements with the Guangzhou police, or with an Assistant Commissioner of Police serving as a visiting professor at the Ministry of Public Security training university.

Is it even imaginable that either side would willingly meet Joshua Wong – one of the leading faces of the Hong Kong protest movement –  as German Foreign Minister did earlier this week?   Will either side call out the excess dependence our universities have come to have on the politically-vulnerable PRC market (of course not –  both sides encourage it)?   Such is the party discipline that not even a single backbencher on either side will ever speak up on anything to do with the PRC.   Both sides are happy to have Chinese language teaching in our schools subsidised by the PRC, through Confucius Institutes which vet for political and religious soundness (toe the Party line or else).  Both sides turn up to PRC Embassy and consulate functions as honoured guests, and both sides apparently support the propaganda efforts of the China Council.   Watch and see if you put a tissue’s difference between them when in a couple of  weeks the CCP celebrates the 70th anniversary of taking power in China.   Tens of millions of dead Chinese –  and decades, right through to today, of extreme repression –  will be quietly ignored as the champagne glasses clink.

And, of course, was there a difference in the – embarrassed, please go away –  way both sides tried to ignore that attempts to physically intimidate Anne-Marie Brady?

Meanwhile Jian Yang remains an, apparently valued (recently promoted) member of National’s caucus.  It is two years tomorrow since the FT and Newsroom broke the story of Jian Yang’s past.  And nothing has happened.  The National Party defends and protects him, never even insists that he front the English language media (all National Party voters elected him, not just some minority of CCP-affiliates).  And the Labour Party leadership has never once expressed even a word of concern.  That makes them just as complicit in having this close-to-the-PRC-Embassy, CCP members, former PLA military intelligence official, who accepts he misrepresented his past on Beijing’s instructions, not just sitting in our Parliament, but advising and accompanying the Leader of the Opposition to the PRC.

But you won’t hear any concerns from Labour (or the Greens or –  these days – NZ First) about that.  Nor, as far as I can see, words from Messrs Capie, Young, or Noakes, the academics quoted earlier.    There has been quite a furore this week in Australia about the new Liberal backbencher, Gladys Liu, and her past ties to CCP-affiliated bodies, and reluctance to express any criticism of the regime.   Bad as her case might be, it seems mild by comparison with that of Jian Yang, where both National and Labour really really just want the issue to go away, and people to keep quiet.

In my first tweet on the Bridges interview, I noted that if he’d had a gun at his head, or the CCP were holding his wife and children hostage, he could hardly have given a more appalling interview.  It really was bad.  But all it really did was lift the lid on the way in which so much of the New Zealand political, business, and media establishment treat the PRC –  ever-deferential, and quite value-free (other, that is, than those “values” of deals, donations, and meetings in Beijing).  Bad as the interview and visit was, in a sense it did us a service, briefly highlighting just how sold-out the establishment (all sides) really are.  But with little media coverage and lots of rugby in the next few weeks, they probably needn’t worry: the Bridges embarrassment will soon be tidied away and forgotten.  And that will suit Labour –  and the business community –  quite as much as it will National.