Saturday, June 18, 2011

What is "Right" in politics?

There is a strange flavour to NZ politics, and it is one which could cause considerable confusion to those from outside looking in and it certainly makes (in the ol probligo’s case at the very least) looking outward over the border difficult as well.

Using the American categorisation as a guide, one would get the impression that the right wing – the far right of the Republicans as example – would be pushing for less government and greater freedoms both personal and market.

If I bring that to NZ and look at what is going on at present – remembering that NZ is only 4 months out from a general election – it is something of a shock to find the youngest (ignore the grey hairs and balding pate) and brightest of the far right from ACT promoting consumer protection legislation.

The incredulity rises when some of the content of that proposed law comes to light in the news

Mr Boscawen today said he would introduce a Consumer Law Reform Bill to Parliament before the middle of the year, which he hoped would be passed before the year's end.
The bill, the result of a recently completed review of consumer law, will amend and consolidate several pieces of legislation, one of which - the Sale of Goods Act - is more than a century old.
Consumer protections contained in four acts which are to be repealed will be incorporated into the Fair Trading Act along with some enhancements, Mr Boscawen said.
"The Bill will also strengthen the enforcement powers of Government agencies, allowing faster and more effective action to remove unsafe products from the market."
Under the changes, unsafe good notices and compulsory recalls may be issued "where reasonably foreseeable use of misuse of a product will may or cause injury".
An example of the type of goods being targeted is laser pointers - which police reported have been used in 108 "attacks" on planes, ships and cars over a two-year period.

In those six short paras we find government protection of the consumer, increased powers of enforcement for government agencies, and government limitation of the products that NZ consumers are allowed to purchase.

One of the current batch of Ministers (ad-Ministers?) for whom the ol probligo can easily express a fair measure of respect is the Minister for Trade Tim Groser. He is a List MP (the ones everyone wants to be rid of…) and in my book is certainly worth his salt as Minister. He is very much hands-on in the Trans Pacific Partnership (TPP) negotiations, that belated and largely benighted attempt by the US to re-establish its influence and contact with our part of the world. As such it also gives a marvellous cameo of the political differences between lion and mouse. (Remember “The Mouse That Roared” anyone?)

Trade Minister Tim Groser took a swipe at the protected United States dairy industry last night saying it was time they stopped "looking in the rear vision mirror."

He said the US "must have a trade policy that is more than purely defensive."
Mr Groser made his comments in a speech in Wellington on the Trans Pacific Partnership agreement being negotiated at present among nine countries including the United States.

He also said New Zealand would ditch the TPP if there was any "sniff" that it was turning into an anti-China vehicle.

He had said so recently at a think-tank in Washington, and so had his Australian counterpart Craig Emerson.

To have the minor players making their stance very clear in this way must be anathema to the likes of Kurt Campbell and Janet Napolitano, both of whom found reasons for being late to the opening of the current round back in February.
Mr Groser said the TPP negotiations would not be completed by the time President Barack Obama hosted Apec in Honolulu in November but "solid progress" would be made.

The degree of progress would depend on what happened in Washington on the US' existing trade agenda, specifically whether Congress approved the free trade agreements already negotiated with Korea, Panama, and Colombia.

"The political oil" to facilitate their passing were the payments known as Trade Adjustment Assistance to affected sectors.

"No TAA, no deal.."

Americans reading this might recognise the “political oil” as euphemism for their term “pork”; but I confess that to be a stray shot.

The point here is coming back to a phrase that I heard some years back as a justification for any and most of the less digestible actions taken by the US on the international scene – “in America’s interests”.

The TPP is where “American interests” meets the real world of a strong-willed and somewhat sceptical southwest Pacific. There is no question that NZ and Aus stand together in the TPP negotiations and I doubt very much that stance would be altered in any way if either government were to change.

It should be well known to readers that Australia (as a “reward” for its services in Iraq and Afghanistan) already has a FTA with the US. NZ already has a FTA with China on which the ink has barely dried. The Australian FTA I have discussed in the past, expressing reservations on the long-term benefit ever compensating for the short term advantages taken by the US. That Australia is taking the opportunity of the TPP to voice opinions that run contrary to those of their partner in the FTA speaks some volumes about the medium to long term benefit of their (previously much-vaunted) FTA. And that too is where the ol probligo pulls up. It is (or has been in the past) a matter of FTA dogma that the agreement will run to the favour of the stronger party; and accepted wisdom says that is the US.

What the US is finding in trying to negotiate their TPP (and it was the idea of the US, not the Pacific) is that the minnows have grown some fairly sharp teeth. The composition and structure of those teeth has come from the influence over a long period of years from the US itself, and its various international allies (children?) such as World Bank, IMF, and OECD. A goodly dose of true capitalism in the mix has been of immense benefit as well, no question or debate.

A very primary example, one that is to the forefront in this country is a statement made in the past week or three to the effect that the US did not recognise the validity of centralised pharmaceutical purchasing organisations; that these organisations are considered anti-competitive; and their existence could represent a barrier to progress in negotiations. The diplomatic wording is very careful and somewhat guarded but there can be no doubt that some very heavy barons in the background are pulling one or three strings in the US administration. Essentially the only candidate that fits the statements is NZ’s government operated Pharmac. This is the organisation that handles licensing of medicines for use in NZ, and negotiates the purchase of those drugs for the whole of the public health system.

The criticism centres upon a “lack of transparency” and equally on the inability of the drug companies “to make submissions” to Pharmac – the “closed shop” accusation. Like so many of these things, there is another side to the impression. “Lack of transparency” implies a level of secrecy, something that a losing tenderer would want to penetrate to find out the prices being accepted for specific or even classes of product.

The “closed shop” is a well resourced and independent scientific and medical analysis system, empowered by the government to freely choose the source oand types of medications being used in this country. Locking out the salesmen (which seems to be at the heart of the outrage) not only maintains that independence from direct and indirect influence (called “corruption” in some quarters), it also allows for the hopefully objective appraisal of needs against supply cost. That in itself is a whole topic worthy of future thought.

The incongruity of the US objections is that Pharmac is very closely modelled on an American predecessor - MedicAid.

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