Just Left

Some Taxing Thoughts

The tax review came out yesterday, and I have been reading and thinking about it among other things. It seems to me that there are several flaws with the review, not all of its own making:

• An imaginative and useful shifting of tax from "goods" (work, investment) to "bads" (pollution, cost-causing personal behaviour) was not really on the table.
• A tedious and a bit pathetic obsession with investment and the company tax rate that seems based more on axioms than facts structured much of the report's thinking.
• The proposals it ends up recommending are a stringent attack on middle New Zealand families and prospects, by redistributing income from the middle to high income earners, and whacking those who have invested in the residential property market.

That said, the report is a far better effort than the ridiculous 2025 report that was the biggest waste of taxpayers' funds I have seen in a long time.  Some of the suggestions read well to me or are worthy of further debate.

For instance:

• I agree that a basic alignment of PIE, trust and personal income tax rates might be worth looking at (but of course, given the deficit and the need to restart payments into the NZS Fund, I would level them up rather than down).
• The caveats about moving the company tax rate are important. The only effect of lowering the company tax rate, given our imputation system, is to give a tax break to foreign investors. We might want to consider why we should do that. Investment in New Zealand is largely tied to our land based resources - and so is probably not all that sensitive to marginal changes in the tax rate. We don't have highly mobile industries here, generally, that need massive flows of investment from offshore.
• The note that any change to GST would need to be compensated for among low income earners is a good head-nod to equity and distributive justice.
• There is an implicit suggestion that all economic income should be taxed. I agree with this wholeheartedly. The fact that some people can structure their affairs so as to not have their economic income taxed is completely unfair. Whether you call that a comprehensive tax on capital or a comprehensive tax on income is beside the point. If we taxed all economic income, we could cut the tax rates on all that income, and I wouldn't complain about that.

Overall a report to mull over and consider.

What I do not want to see, above all else, is a set of changes that simply transfers income from the families who need it most to the individuals who need it least.  I doubt that is part of the Government's plan either.

Republicanista

Of course, I am a republican. I don't believe people should hold any job in public life because of who their parents are. It offends me deeply that we have a Crown and not a People as our symbolic point of reference.

So I was pleased at this morning's Dom Post editorial, and pleased that Republican Movement people had a banner to make a point at the Supreme Court's opening yesterday. 

I would like to see us have a commission look into all the details that would be needing sorting should we have a republic, and a broad public conversation followed by a couple of referenda to make a call, somewhere around the middle of this decade.

The hardest question is whether we clip on a republican look to our monarchial constitution, or whether we have a more thoroughgoing look at the bonds of citizenship and affection that bind us together as a political community - and the role of the Treaty relationship in that new republic.

Just because a question is hard does not mean it should be ducked, so I am glad that the issue's on the table once more.

- Jordan

What must Labour do?

As the fog of war lifts, you can see more clearly the contours of what has happened in the recent past.

We lost in 2008 for reasons I have canvassed before - people thought we were focused on issues that weren't important to them; we'd been in office for a long time; there was a recession; people had fallen out of love with our political style; some of our policies were not working out or were unpopular; and failures of political management added on top of this combustible pushed us over the edge.

That's what we did wrong. The Nats also did things right: they really did move to the centre, and they selected a leader who people like. Actually, they *really* like him - for the time being anyway.

We do have strengths though. People generally get the message that we ran the economy well, that health and education got better, that we ran a foreign affairs policy people can be proud of, and that we had a capable government that was doing its best for the people.

The Labour Party thus enters 2010 in a reasonably good position. Last year we managed total leadership change in the caucus and the organisation, we managed to get our fourteen new MPs working well, and we spent a lot of time out around the traps listening to people.

Our task this year, to be blunt, is to listen to what people have been saying, and to go beyond listening, and into reflecting back the things we are hearing and seeing what people think. Instead of listening and saying "that's nice", we have to say, "we've heard you and this is what we think."

That's policy, in some areas, but it is also in the politics or statecraft of the party. For better or worse, the fifth Labour government was a baby boomer government. The political methods of the 70s and 80s were those which ran it: it was tightly managed and focused.

I get the sense though that people are looking now for something a little different. Some in Labour look at Key's hands off approach and see a weakness. I see a strength. The rise of ICT, the end of "deference" towards authority, and growing generations of people who are as comfortable online as offline mean that a political party that is centralised and top down cannot really capture the public imagination.

What Labour must do is turn itself inside out. As we say "this is what we are hearing, what do you think?", we also have to invite people in to join with us and help shape what we are doing next. We have to use the best technology there is to do it, as well as the traditional means of face to face and direct mail politics. We need to be the party that people see as grassroots based, and where they know that if they want to raise an issue or a concern, it will filter through to what our policy is and what our politicians are saying and thinking.

We have to do this if we are to be relevant, and if we want to win there is nothing more important than being relevant.

When people broadly think that the Labour Party is the party that they can shape, that listens to them, and that reflects their concerns and hopes and aspirations in the nation's politics, then we will know we are on the right track.

It's not about rejecting what we did when last in government; it's about setting up the next government in a way that is relevant to people.

I'm looking forward to seeing how this agenda plays out over the coming months.

- Jordan

2010!

Hey folks, Happy New Year and all that jazz. The naughties are done, and the tens have begun.

Back in August I made some foolhardy promises about how much writing I might be doing. Hasn't happened. I was still too busy with other things - an ongoing restructuring at work, thesis work and of course Labour Party activity.

After a solid long break though I am feeling a little more loquacious, and so I hope to be offering a few more things here in twenty-ten as we're all calling it.

Last year politically was interesting. For me the biggest plusses are two, one found inside Labour and one found in the Government.

For Labour, the big plus is that we've resisted the historic tendency of left wing parties to undergo a round of infighting after losing office. Losing elections sucks, and the idea that people might like to have it out with each other and lay blame etc is not a surprising one. Problem is that it's self indulgent crap, and not what voters expect. The British Labour Party is doing that already, in advance of losing its election this year, but we aren't - and we won't. That's a relief.

The government is a big plus because it has shown firstly that it isn't a bunch of radical libertarians, and secondly that it doesn't really know what it wants to do. The first is good because it means John Key's campaign was honest. If I was an unkind man, I would describe him as a sheep in sheep's clothing, but I am not, so instead I will say he's an amiable, smart guy who is doing what he said he'd do.

The "what should we do next" is a plus because eventually people will tire of a government they sense doesn't have a plan. New Zealand faces lots of challenges that the government can play a key role addressing. This government already doesn't look like it has the ideas to tackle some of the biggest - particularly our economic situation, which is a theme I will come back to again and again.

As I observed back in August, the focus of my writing will be on Labour and on issues. It won't really be on the Government or the National Party, or their hangers on. Partisan rants will have to come from other authors, I'm afraid.

I'll be popping up now and again. I've got a few pieces on Labour strategy, the lessons of economic geography, broadcasting policy and others that I am chewing on. If I get one decent piece out per week, I'll be happy.

Best of luck for a great 2010!

- Jordan

March for the right to beat your child 15 times with a hosepipe

 

Spotted this on the New Zealand Herald website. Interesting choice of advertising. This beating could well have gone unpunished if the old section 59 of the Crimes Act still stood. It could have been interpreted by the judge as 'reasonable force' and/or part of 'good parental correction'. I love the logo for this march. Jack boot prints. They seem to me both appropriate and ironic at the same time. That's all I have to say on the subject that is appropriate for civilised company.

-Dolan

Did you hear the rumour that Hone will be singing his defence at his disciplinary meeting?

(to the tune of "What a Wonderful World" by Sam Cooke)

Don't know much about history
Don't know much about gay Paree
Don't know much about a dumb rule book
Don't know much about the perk I took

While I don’t know what I told all youse
I know I had a bloody good excuse
What a wonderful world this would be

Don't know much about geography
Don't know much about the Champs Elysees
Don't know much about pakeha
Don't know what the mofos get peeved for

But I did know that if Tari knew
That I didn’t really have the flu
What a horrible end I would meet

Now I don't claim to be always prudent
But I'm trying to be
So maybe by being prudent, Tari
I can win your love for me

Don't know much about history
Don't know much about gay Paree
Don't know much about a dumb rule book
Don't know much about the perk I took

But I know I do what I want
Skip a meeting for a free croissant
What a wonderful world this would be

La ta ta ta ta ta ta
(History)
Ooh ooh ooh ooh ooh ooh
(gay paree)
La ta ta ta ta ta ta
(Dumb rule book)
Ooh ooh ooh ooh ooh ooh
(Perk I took)

But I know I do what I want
Skip a meeting for a free croissant
What a wonderful world this would be

- Dolan

 

Flat tax ruled out

I'm pleased to see (Stuff) that John Key has ruled out the adoption of a flat income tax in New Zealand.

Flat taxes are a nirvana of the fringe right. They increase the income of high income earners and decrease that of low income earners compared with a progressive income tax system - in other words, they make life harder for people on struggle street and easier for people who already have it easy.

The supposed economic benefits may be there in theory, but in practice the progress of an economy is about much more than the structure of its income tax system. New Zealand's economy has been held back by being treated as a branch economy by foreign investors, by low wages that have come in part from weak unions and a de-regulated labour market, by a lack of public and private investment in science and innovation, by a lack of market penetration by our largest firms in foreign countries, and by a monetary policy regime that just doesn't deliver a reasonable real exchange rate position for export growth.

Anybody who thinks that a regressive change to the tax system will fix those problems needs their heads read. It's reassuring that the Prime Minister is not one of those people.

Jordan

Houses of ill repute

Can we PLEASE, please, please, please, PLEASE [after this post] give the housing allowance thing a rest now?!? I’m banging my head against the wall so hard here that the ensuing dent is reducing the pecuniary interest I have in my property. But that is not the biggest problem. The worst thing is this never ending tale of dross is also seriously depleting my will to mock Bill English. It’s that grave.

I mean come on, I can enjoy a good attack on Mr 21% until the cows come home. But the location of his primary residence and the money he claims for it are so far from the biggest problem this country faces right now you need a TARDIS to travel between them.

Every time it seems like we’re moving on with our lives, the inevitable new revelation that drags this crappy story out another couple of weeks emerges. We learn it’s not just National MPs that own property they then rent out to Parliamentary Services for various uses. Surprise, surprise – everyone does it.

And why not?

Imagine an MP rents an Electorate Office from a private landlord, only to be told a while later that it is going to be sold. The MP must face the prospect of moving. It is a great office. It has all the space they need and is in a location that everyone in the electorate identifies with as where the MP is. The MP purchases the property so as to stay put. Is there anything wrong with that? Can someone explain to me what the earth shattering problem is that’s so scandalous it knocks the recession back to the travel section?

Likewise, if an MP is renting a property in Wellington. A spot that they like. Walking distance to Parliament, perhaps. Or just somewhere they feel comfortable. Why can’t they buy the place and be happy in the knowledge they can stay as long as they want without it being sold from under them? It might be an investment. But if an MP can invest that money anywhere, Dipton say, and get a private tenant (unlikely, I know but bear with me) who pays the rent. That same MP then rents a house in Wellington off a private landlord with the rent covered by their allowance – What’s the difference? The taxpayer pays the same money either way. The MP has their mortgage paid just the same.

With the exception of Premier House, I really don’t care one jot where on earth Boll lives most of the time. To be honest, I think slightly more of him if he wants to spend as little time in Dipton as humanly possible. The real question is: If he was not in Parliament, would he live in Wellington? Possible, but I assume it unlikely. So the taxpayer assists him to live in the city where, as a Minister, we need him to be. He also needs to retain a place to crash near his constituents. What other job requires you to live in two places at once?

I know this is not the most popular opinion in the room – but MPs and ministers are not actually that well paid. Their salaries are not huge when you consider the hours they work and their lack of privacy. They have 24/7 jobs. When you compare their remuneration with comparable roles in the corporate world they only earn a fraction of the going rate. Part of the reason they have a whole raft of allowances and perks is because it has been politically impossible in the past to increase their salaries. So we find other ways of compensating them. It’s actually unfair to take that money back now. If it happened to one of my union members I’d be outraged.\

But all that is nothing, NOTHING compared to the massive distraction this has caused. Every single second the media spend on this is time they could be spending asking what the government is doing to tackle the recession, to tackle unemployment and to fix the problems in health and education that National promised they would fix. But it’s not just the media. I urge all political parties to stop trying to score cheap points on this and use the time to attack the government on issues that matter – there are a lot of them.

- Dolan.

I am a Social Democrat: Reflections on the NZLP Conference

I joined the Labour Party in 1997 because I am a social democrat. I believe that a more human society, one that is better for everyone, is a more equal one: more equal in incomes, more equal in wealth, more equal in power and opportunity and self-respect. Equality is the distinguishing characteristic of social democracy.

Liberalism is not social democracy, but the social democratic project of necessity includes much of the liberal project. A key component of liberalism is the abolition of social inequalities, whether these are racially based, gender based, religiously based, or on one's sexuality, or intelligence, or weight, or whatever.

We believe people are equal as moral beings, and so they deserve not to be discriminated against because of characteristics they have.

And we believe we build a more equal - and a more moral - society when we stand for social and economic equality.

Why do I start a post about the Labour Party's 93rd Annual Conference with that? It's simple, really. The public formed the view in Labour's third term that Labour didn't care about the essence of the social democratic project. The public thought that we had become a mix of social libertarian extremists on the one hand, and bossy boots know-it-alls on the other.

That perception combined with (and partly heightened by) errors of political management and a slowing economy are key components of why Labour lost the last election.

What the first Conference with Phil Goff as leader had to do was reset expectations. It had to break through that public perception and give the party space to be potentially seen as something else.  Given the way the media works and the limited attention that Labour is getting, the message could not be a subtle one.

So, we said sorry. Personally, I am sorry. I am sorry that people thought we had our eye off the ball. I am sorry that our economic agenda didn't end up being bold enough and visible enough to captivate people. I am sorry that we as a party didn't manage ourselves in a way that people thought was good enough. I am sorry that the way we did electoral law reform was not inclusive and was more concerned with a parliamentary majority than it was with building a community consensus about the need for change. I was and remain sorry about what we did with the Foreshore and Seabed stuff a few years ago.

I'm proud that Phil and the other speakers grabbed this issue by the horns.

I'm also proud that all of us stand for a liberal and social democratic party. One that does want to open up more freedom and less discrimination for people. One that wants to make society more prosperous and more caring. Labour isn't backing away from a liberal agenda, though it will no doubt never be as ready to impose things on people (which are two very different things that got conflated in "nanny state"). But Labour's focus is and will be more visibly on the traditional concerns of our party and movement.

I think that's as it should be. I hope that as we keep working on those issues, putting our focus on those that matter most to people, any lingering perceptions of us as being obsessed with other issues will fade.

Readers need to understand that our own perception of what we were doing, at least from my standpoint, was not the picture that I painted and for which we've said we apologise. We thought we were focusing on people's concerns. The liberal agenda was not the core of what I spent most time thinking about and working for. 

But as Phil and others have said - the voters are right. Our perception of what we're doing does not matter, because we are not millions of Kiwis who decide the kind of society we want. We're only a tiny subset. 

Apologies are not fun. But this one had to be made and it was right to do it. Just as we were right at Conference to celebrate the achievements of a brilliant government, with far-sighted leaders in Helen Clark and Michael Cullen who took our country to a richer, fairer and frankly better place than it would have been without our Fifth Labour Government. 

Just as we were right at Conference to focus on the future and the challenges Labour will face in shaping a fairer and more equal society next time we take office, which I hope will be in late 2011. 

It is hard to say how it feels to both acknowledge and agree with needing to say sorry, and on the other hand being pleased with the vast majority of what we did in office. But that's how I feel and I know there are many others in the Party who share that feeling.

The pledge we gave, through Phil's speech and in the conversations and the issues we had and debated at Conference, is to make sure we don't make the same mistakes again. We won't, and that's good for Labour and good for New Zealand.

Jordan

Blue Cossacks at the Door

National's 1975 election campaign infamously used the image of the Dancing Cossack to suggest a Labour plot to engineer a communist takeover through compulsory superannuation. More generally it positioned Labour as the command and control party that wanted to have everything run from a centralised politburo.

As we all know Labour lost that election (to the hands-off economic liberal Muldoon), so commie-takeover-crisis averted. However in certain sectors of community governance we are seeing a new kind of cossak emerge - the blue cossack. Across Auckland governance, the health sector, and the polytechnic sector, the Fifth National government is advancing the firm hand of the state across institutions that have previously operated within a statutory framework, but have been governed largely by their constituent communities.

This post focusses on the Polytechnic sector, which I have some knowlege of as a CTU representative on the Council of Manukau Institute of Technology (MIT). These comments represent my own views, and are not necessarily those of MIT.

The independence of Polytechnic governing Councils are facing an extraordinary attack through the Education (Polytechnics) Amendment Bill. The Bill has some useful features (including provision for a Tertiary High School at MIT and beefed up intervention powers for institutions in trouble), but through its changes to the composition of governing councils it will cut polytechnics off from the communities that they are supposed to serve and give Ministerial control of Polytechnic governance. Of great concern is that these proposed changes apply exclusively to Polytechnics and not other Tertiary Institutions, and that they run counter to the government’s stated principles for the sector.

There is a broad acceptance that New Zealand’s tertiary institutions need to have strong links with the communities they serve. In the case of Polytechnics, this is particularly important. As the main providers of vocational training and entry level tertiary qualifications, Polytechnics need to have a high level of engagement with employers, the workforce, and other groups within their constituent communities. This isn’t just about warm fuzzies, it’s about Institutions actually being linked in enough to meet the educational needs of their communities to respond to opportunities and challenges as they arise.

For these reasons the governing Councils of tertiary institutions have, to date, been given the ability to constitute themselves in a way that is reflective of their communities. At Manukau Institute of Technology for example, the governing Council contains, in addition to the statutory positions of a Business NZ Rep, a CTU Rep, and Ministerial Representatives, positions representing local secondary school principals, the City Council, staff, Maori, and the University of Auckland. MIT has chosen a Council with this composition to meet its strategic goals, and the needs of the community. For instance, we have a significant strategic relationships with Manukau City that is coming to fruition through a new City Centre campus - so having a direct governance link with the City on the Council has made a lot of sense. At other Institutions the mix is different to align with their communities and objectives.

The government’s proposed changes will remove the ability for Polytechnics to be governed by Councils that are representative of their communities and will instead give the Minister of Tertiary Education effective control of governing Councils. Council size will be reduced from between twelve and twenty, down to just eight. Four of the eight will be appointed directly by the Minister, who will also be given the power to appoint and sack Council Chairs and Deputy Chairs (these positions are currently elected directly by Councils). The other four will be the CEO, a student rep, an academic board rep, and one community rep. While most Ministerial appointments to Councils will no doubt be dutiful and capable people, these changes decisively shift the balance on governing Councils from community representatives to political appointees.

This change to the composition of Councils means that they do start to resemble corporate boards rather than the governing bodies of public educational institutions. A number of other proposed changes underscore this point. The absence of any staff representatives removes an important voice from strategic decision making, while the removal of the restriction from serving on more than one Council, and a new ability to indefinitely re-appoint Ministerial representatives suggests the establishment of a class of semi-professional government appointees who can carry out the Ministers bidding across a range of Institutions. While this possibility remains unproven, the shift in focus from community representation to Ministerial control is clear.

These specific concerns to one side, an obvious question to arise out of the proposed reforms is why just polytechnics? The government’s policy statement declares that the changes are designed to “improve the governance capability and effectiveness of Polytechnic Councils”. One has to question why the government does not want to “improve the capability and effectiveness” of other tertiary institutions such as Universities and Wananga. Could it possibly be that they fear the strong political influence of these entities and that the Polytechnics are an easier first up target?

Finally, it is appropriate to question the mandate that the government has for pursuing these changes. While the Minister claims that “The sector has told me that governance is unwieldy at the moment”, there has been no formal consultation with Councils prior to the Bill making its appearance. Nor did the government signal any intention to review governance arrangements in its pre-election manifesto. Indeed, National’s Tertiary Education policy makes the following statement: “We favour a high-trust funding environment, with tertiary education institutions that work to clear, simple rules with minimal but effective oversight from government”, while lambasting the previous government for “heavy-handed centrally driven control”.

In introducing this Bill, the Minister has strayed from the government’s own stated principles and is seeking to control Polytechnics from the Beehive in an unprecedented and dangerous way. Polytechnic Councils need to represent the communities they serve, rather than aping a corporate model that is inappropriate for public educational institutions.

Submissions on the Bill close at the end of September - if you have an interest in our tertiary education system I urge you to get writing!

Michael Wood

Labour Conference approaches

Interesting Colin James thoughts on this in the paper this morning. A few snippets:

Don't look for despondency at the Labour Party's conference this weekend. This is not a party in mourning. It is a party sensing opportunity. In part that is due to the influx of 14 able, mostly younger, MPs, in part due to the clean leadership changeover straight after the election, matched by a quick transition at the top of the party outside Parliament, and in part due to the Mt Albert by- election success. 

...

Labour's challenge, starting this weekend, is not just to cobble policy for 2011, which is easily done, but to develop policy which will be modern nine years on from 2014. That requires fundamental rethinking of the baby- boomers' line. Labour has yet to show it can meet that bigger challenge.

The dominant policy tone of the past 50 years has been civil, moral and economic liberty. Our sorts of societies and economies have been deeply transformed by deregulation. That is the baby-boomers' legacy.

In the economy, this deregulation, accompanied by the increasingly rapid development of a transformational technology - information technology - gave us a bubble-boom, followed, as all such bubble-booms have been, by a financial crash. It was also accompanied by a spike in income and wealth inequality, as previous technology-driven bubbles have been.

...

But note, for example, that John Key has appointed pre-baby-boomer Don Brash and baby- boomer Mr Caygill to guide us to wealth parity with Australia. He has reached to the past, not the future, thereby giving some credence to Victoria University academic Jon Johannson's argument that Mr Key and Bill English are not a new generation of policy leaders but the tail end of the baby-boom - transitional, not transformational.

Of course, the transformational thinkers who generate the post-crash policy revolution are not likely to be found in this country (though it is not impossible). The problem for politicians here is which major party can tune into them and translate their ideas to local conditions.

That is what Labour's 20-and-30- somethings conferring this weekend might ponder. Those watching from National's side might, too.

I often agree with much of what James writes. He is certainly an acute observer of what happens in NZ politics. 

One thing he's definitely right about is that the Labour Party conference won't be downbeat. It might be smaller than in recent years - that's what election losses do - but the party is chipper and starting to look carefully at where it goes next and why.

After all when you lose, you have to look hard at yourself, as well as working what your opponents did better than you. And so a little bit of that will be in order in Rotorua this coming weekend.

Liberalism or Social Democracy?

There was a fascinating piece in the London Review of Books recently which had me thinking, and which I saw directly after reading this piece by Chris Trotter. Near the end of the piece from Trotter is this:

AND that’s the problem, really. As the years have passed, Labour’s Mall, once so new and exciting, has become old and tatty. Its Eighties’ architecture, all mirror-glass and chrome, has dated horribly, and the shops inside just haven’t kept pace with the new trends in political retailing.

What was politically fashionable in 1987 is now more than 20 years out-of-date. The bright young things who stood behind the counters when Roger Douglas was turning New Zealand upside-down, have become middle-aged and frumpy. Nobody wants Nuclear-Free NZ T-shirts anymore. The vibrant rainbow banner above Fran’s "Change the Law" café has frayed and faded. "Women’s Council" spent a small fortune on a product called "Section 59" – and nobody bought it.

It’s 2009, and Labour’s share of the political foot-traffic has fallen to historically low levels. The only shop that’s still attracting customers is "Sustainability".

This evokes a recurring theme in Chris's writing - the departure of the Labour Party from a social democratic project of building a more economically equal society, and into a project of building a society more equal on many fronts: a social democratic-liberal project, which was threatening to some proportion of Labour's more socially conservative, but still economically progressive, base vote.

The funny thing about that debate is that internally, most Labour people - no matter where they come from, be it youth or Rainbow or women's or whatever sector - believe in the pairing, the indivisible twinning, of a more socially and a more economically equal society. We see them as part of the same project, and able to support and enhance each other. But with the rise of the global hegemony of neo-liberalism, there were quite strong external forces that said "sure!" to social liberalism, but "no way" to economic progress towards a more equal society.

Our fifth Labour government did make some progress on the latter, but it made more progress on the former. That was I believe a key to its electoral success: it was the niggling "bossiness" of some of the policies, not the core liberal ones, that ended up hurting us in the 2008 election.

Anyhow. The LRB piece is here, and a key passage is this:

My point is not that anti-racism and anti-sexism are not good things. It is rather that they currently have nothing to do with left-wing politics, and that, insofar as they function as a substitute for it, can be a bad thing. American universities are exemplary here: they are less racist and sexist than they were 40 years ago and at the same time more elitist. The one serves as an alibi for the other: when you ask them for more equality, what they give you is more diversity. The neoliberal heart leaps up at the sound of glass ceilings shattering and at the sight of doctors, lawyers and professors of colour taking their place in the upper middle class. Whence the many corporations which pursue diversity almost as enthusiastically as they pursue profits, and proclaim over and over again not only that the two are compatible but that they have a causal connection – that diversity is good for business. But a diversified elite is not made any the less elite by its diversity and, as a response to the demand for equality, far from being left-wing politics, it is right-wing politics.

This is an altogether more considered piece than most domestic writing on the issue of the tie-up between social democracy and social liberalism. The deep point he's making is that the neoliberal project is OK with social liberalism - indeed demands it - but is against and threatened by any project of social equality. That's obvious enough: liberal economics demands unequal economic outcomes axiomatically. Nobody should find that surprising.

What I don't accept though is any reversal of that equation. Social liberalism and social democracy are not antithetical. There is nothing inconsistent between arguing for a more equal society on the economic front, and a more equal society on the social front. If the socialist ideal is a conception of human freedom where we are equal as human beings in society, then we can no more accept deep inequalities of income or wealth than we can accept hierarchies of gender, or sexuality, or race.

That's why I'm happy with where Labour is on these questions, in its instincts: we join and support both aspects of equality, economic and social, as being part of the same project of enhancing people's freedom and autonomy, their ability to live the life they choose. 

That, however, is not where the public sees us. Both Chris and other commentators - including perhaps you, dear reader - may share the widely held perception that Labour (and sometimes more strongly, the Greens) actually is about telling you want to do, about controlling things, about reducing the scope of individual freedom and autonomy and replacing it with a kind of grey, command and control economy and society, where fun is banned, the sun is put away, and everyone does what we want them to do.

All I can say in response to that kind of attitude is: bollocks. That's not what we are about. The fact we got some people to think we were is a major political failure, some of which is our fault and some of which is the consequence of clever campaigning by other people. 

What do we do about it? We simply be who we are and say what we want, and we bring about a better balance of the issues we are campaigning on. Social liberalism is only part of the Labour project, not all of it. We need to be more visible on basic issues of family incomes, public services, working rights and sustainability and economic development than we have sometimes been. That's part of the reconstruction that we are now undertaking.

And that'll do for now.

Jordan

What next?

I've been mulling a bit with how to proceed (and whether to do so) with writing anything on Just Left for about two months now, which is the main reason for the lack of posts. Time pressures with work and study and Labour commitments mean it's hard to fit it in, and they're all more important than the old blog unfortunately.

The tentative decision I've made is to only try and post once or twice a week, and for my posts to be focused on Labour's future and the prospects for social democracy in these islands we call home. 

The day to day ratrace of Government, and the opposition-government contest that haunt the media and most political blogs, are not as interesting to me as the broad question of "where Labour goes next". And obviously, if one is talking about where Labour goes next, then that has to be a long term question to avoid the day to day rat race. That's fine by me: my interests in politics have always been more about the long game than tactical management of issues, or who is up and who is down.

This is in a sense a return to home for this blog. That was the focus I used to have in my writing. For a few years tho the focus went somewhere else, and with a greater media and "game" theme appearing in the writing.

I'll see how it goes. Might work out, might not. Drop me a line if you've any feedback on it. The other authors remain free, if they choose, to write as they like from a Labour point of view.

Jordan

Not Yours To Sell

Worth a watch this - very well done to Phil Twyford for pulling this together. For more on the issue, go to the issues.co.nz page here, or sign up to the Facebook group (if link doesn't work, search for "Not Yours to Sell" on FB).

National Party On Again, Off Again Message

It's been a while between drinks here at Just Left so I thought I'd get the ball rolling.

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First thing first; if you're looking around for someone to defend Taito Phillip Field, keep on looking because you're unlikely to find it here. I hope they throw the book at him.

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Isn't it amazing how almost every cabinet minister has turned the ministerial housing issue into a family issue - "we want to live with our families", "this job puts presure on our families", "please don't make me send my family back to Dipton, Whangarei, where-ever-the-hell-they-come-from".

I have a certain level of sympathy for the workload placed on Ministers and their respective families. Being away from home five days a week would be tough, especially if home is two flights away (such is the case for English and Heatley). At the height last year's campaign, I caught up with the spouses of several Labour candidates - the pressure that was put on them by their partner's campaign was immense, especially those with young children. Anyone who thinks politics is a glamour sport should think again.

Where I start to loose sympathy is when the likes of Bill English claim $900 a week for his 'secondary' residence in Karori - which just happens to be where Mrs English and their children have lived for two years. Mr English (and John Key) then startto talk about Mrs English and associated sprogs being forced to move back to Dipton if the deputy Prime Minister doesn't receive the ministerial allowance. Despite a pay increase of almost $100k. Plus the fact that he could afford it while being deputy Leader of the Opposition. Plus he's overseen the review of government department budgets, resulting in thousands of redundancies. Whether he's entitled to this or not, it's not a great look Bill.

Plus the "we're family men" isn't as potent any more because, well, the child-less Helen Clark lives in New York now, and Phil Goff has a family. After a decade of the Tories holding the fact that Helen didn't have children against her, the Nats all of a sudden have to look for a new song book.

And what's with John Key spitting the dummy at his Post Cabinet Press Conference on Monday? The first time the Prime Minister gets angry about anything is defending how much his ministers get in allowances. In the height of a recession. Also not a good look.

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It appears that the reason that so many people are loosing their jobs is because the opposition keeps talking about it. John Key wants it to stop - Loose lips sink ships - or at least the economy. So if we're not allowed to talk about it, why does Bill English use it to try to change the topic from the expenses he's claiming?

And then, John Key tells Keisha Castle-Hughes to "stick to acting" rather than commenting on climate change. I'd rather Key had stuck to currency trading rather than trying his hand at leading the country, but this is a democracy and everyone (even Mr Key) has a right to an opinion. In the name of consistency, I assume Mr Key will in future not be calling on Michael Jones or Va'aiga Tuigamala to do anything other than chuck a rugby ball around?

Not a great week for the Nats and it's only Wednesday.

Radio Silence

In case anyone's out there - I have been travelling since 8 July and obviously others have not been posted. Come or go as you like :)

A Subcommittee?

Interesting to read that a subcommittee of the Local Government Select Committee will be meeting with Maori on local Marae to hear their concerns regarding the Auckland Super City.

Surely, if the select committee were serious about listening to local Maori the full committee would be meeting with Maori, not just a token subcommittee?

More on "Gen X and Y: just leave"

Here's a video of Bernard Hickey talking about his blog post on breakfast TV. Worth a watch, even if it is a little bit scary.

Envy of Angels

A Friday reminder of good writing - if you've not heard the song, buy it on iTunes or something. 

"Envy of Angels" by the Mutton Birds, 1996 I believe. Don McGlashan performed it live during a talk about the importance of place in writing, and why he loves Auckland, at an event on 20 June. The song is about the city.

Look over there, you used to say,
the shape of the land beneath the street.
Ridges and valleys and underground streams,
you have to know whats under your feet.
So you can make things strong enough,
to take the weight.
The weight of all the people
that haven't been born.

That's what you said to me,
and it's the envy of angels.

Listen to that, you used to say.
Can you hear someone drawing plans?
Can you hear someone cutting wood?
Can you hear someone walking the land?
And all the time I wanted to be,
somewhere that wasn't so new,
where you don't have to dig youself out - 
a place to stand.

Far away,
from the envy of angels.

Driving to your place after dark,
the light of the town behing those hills.
I'm wanting so much to see you again.
I can almost touch the new tar seal,
in front of my wheels,
they're painting the signs,
measuring the land,
marking the lines,
laying foundations,
making it strong,
for all of those people,
Who haven't been born.

Just like you said.
And it's the envy of angels.

Just like you said.
And it's the envy of angels.

That current account deficit...

So the numbers out of StatisticsNZ today make slightly scary reading. The current account deficit in the March 09 year is 8.5% of GDP, or around $15bn. The net balance between NZ's assets and liabilities is up to 98.2% of GDP - $186.2bn.

Is it a problem? Well, some people say yes and some people say no. In part it depends what kind of economy you want. I regard that large external debt as a problem because I want to see more of the income New Zealanders generate retained and spent in New Zealand, and I want us as a community to not be susceptible to bullying by the corporate representatives of those to whom we owe all that money (i.e. the "Ratings Agencies". This year's Budget could have been a lot better without that pressure.

I don't really buy the arguments that some who say it's not a problem present, as they odon't have the same goals I do for our future economic development. I am more interested in thinking like this at the Treasury (arguing that net of debt costs, the inflow of foreign capital leads to higher real incomes per capita as it has largely been spent on productive investment, but it isn't a commonly heard argument, and explicity doesn't make the case that the situation is sustainable.

Just from a risk mitigation perspective, it's probably not good to have the whole value of your annual production sitting as a debt load you have to service. So we should probably try and turn it around.

Then the question is how you change things.

There are two ways to close the current account deficit. One is to think about the trade side, and one is about the investment side. I'd be very happy to see a multipronged approach to the issue given how large the debt is and how long it will take to turn around.

On the trade side, you simply want to achieve large trade surpluses that help pay for the costs of the debt and more than meet the costs of our goods and services imports. Given that we want imports, reducing them as a policy response (through trying to minimise them or through trying import substition approaches) has no good track record, and is a bit like denying yourself the whole point - things we want that we do not make.

If exports are your focus, the NZ Institute and others have pointed out that our exports as a share of GDP have not really lifted much in the past twenty or thirty years. A range of policy approaches have not worked - not Muldoonist fiat and protection, not Rogernomics scorched earth, not Labour's modest rebalancing and re-growth of industrial policy. (In the latter case it may be a little too early to tell, to be fair.)

So we need new approaches. I don't know if that's a scale issue or an approach issue: should we invest another $200m a year in market opening, trade promotion, business plan development, sector programmes, picking winners, whatever, here? Or do we need completely new approaches - and if so, what are they?

On the investment side, we did have some hopeful things happening, but things have gone backward with the change of government. KiwiSaver and the NZ Super Fund were leading to the accumulation of new financial assets by government and by the public, but both have been put on the shelf. The Crown contribution to national saving has been turned by policy and by recession into a Crown contribution to the national debt.

It's a simple equation. If we want Kiwis to own more of their own country, and/or more of other people's countries (which has the same effect on the deficit), then we have to save more as a nation. Individually and collectively we need to consume less and save more.

Some things that might help with that?

• changes to the tax burden - esp the weird non-taxation of residential property
• relative shifts in tax burden from income to consumtion and from savings to consumption (tho this has distributional impacts that would need to be fully compensated for if looked at, in my view)
• restoring cut savings assistance programmes, esp. KiwiSaver and the NZ Super Fund

There must be more, though: your thoughts?

Government could be part of the solution, though the public mind seems to be that a big surplus is an excuse for a tax cut, instead of commendable savings for the future through lower public debt. It would also only be able to contribute to national savings through cutting already-low levels of public spending (not really a viable option), or through increasing taxes - which is politically close to impossible at the present time.

I think we need to have a bigger and brighter public debate to decide whether we really think this is a problem, and if so, how to tackle it. At the moment the country is only really whinging about it - something we love to do, sure, but which isn't going to change anything.