Sunday, 18 September 2011

Building A Brighter Future

There was a ray of hope for a while. It was when John Key announced that it was National’s plan for New Zealand wages to match those of Australia. This would stop the skill drain across the ditch and set New Zealand on a path to a brighter future.
As I travel through the northern part of the electorate (where local body by laws allow for earlier election advertising than is permitted in the south) I am confronted by National advertising placards, with John Key’s smiling face and the slogan “Building a brighter future”.
Good idea John – we all want one. The trouble is that we don’t know what he means by that. I guess we just have to decide for ourselves. For my part I go back to the original idea of wages that match those of Australia. That would indicate that the government had really got it right.

But it was an empty promise – a goal with no steps in place to actually get there.

First of all, he set up a group to flesh out the plan, headed by Don Brash, and that was the end of that. Their report indicated that the group had no idea how to achieve the aim and it disappeared into the bowels of the Beehive never to be seen again.

Then Deputy Leader Bill English stated that New Zealand’s lower wages were our competitive advantage –lower wages will lead to our that are our brighter future – (shades of Roger Douglas and Ruth Richardson?)

When a government sets up a goal like “incomes that match those of Australia”, it’s a good idea if everything else they do isn’t in head-on conflict with the plan. So where are the steps that will lead us to a brighter future?

One would expect them to be positive changes; there’s no way that cuts are going to lift the economy. I would start with putting money into early childhood education. Giving our youngest people the best possible start is certainly forward looking. Then I’d make sure that families with young children are fully supported in their difficult role of caring providers and income earners. Then I’d make sure that all school leavers were fully equipped to enter the world of work and are either immediately employed, or are in a training programme or further education. I’d make sure that government was providing the support and resources and services that are needed in a complex modern economy. I’d boost wage rates by making it illegal for any worker to be paid less than $15 an hour. And finally (although this is far from a complete list) I’d make sure that everything possible was being done to increase the productivity of New Zealand. That is a vital step. It is the step that makes the rest of the plan affordable.
It is the very opposite of what the National government is proposing.

Frequently when talking to people in the Wairarapa electorate, I hear comments suggesting that the party policies are the same – the tweedle-dum and tweedle-dee principle. This couldn’t be further from the truth. What I have outlined above is Labour policy. National’s policy is to cut spending on early childhood education; to reduce family support; to blame and punish people who can’t find a job, when there are no jobs out there; to limit the bargaining strength of unions so that wage increases are rare, and to leave it to employers to build the skill base of New Zealand when employers are struggling to survive.

The weird thing about National’s response to the recession is that it has reverted back to the failed free market logic of the 1980s and 90s hence a prescription of asset sales, deregulation, free market dogma domestically to counter a global economic recession caused by that very same deregulated free market dogma that fuelled the recession in the first place.

I would avoid, at all costs, cutting public spending on the grounds that the private sector can do it better. Public spending is a driver of economic growth. Take infrastructure for example. Private companies do not invest in infrastructure. The road and transport system, the electricity system, the telecom system, the postage system, the water and sewerage system, all have been built up through public spending. The failure of rail under private ownership is the perfect example.

Then there is the secondary infrastructure of any civilised society; the public services such as the health system, the libraries, the universities and polytechs. The stuff that supports the growth and development of people and supports and generates a highly educated and skilled work force. As economies grow, the demands become more complex and more expensive, but the services needed to support the new economy become more and more essential. Cuts in public spending are entirely justifiable when there is waste, but when they are cuts because of an ideological stance that public provision is bad and private provision is good, the result, as we have seen twice before in recent times, can mean economic collapse.

We can have an economy that is strong enough to pay our people well, and to stop the exodus of our most skilled workers in both the public and private sectors. We can build our productivity by a planned approach that I would expect a government to pursue actively. And it would include free education and quality education at every level and most importantly, it would not include selling our money earning assets to private interests.

It won’t be a brighter future if we can’t afford to turn on the lights.

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