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Consumer protections contained in four acts which are to be repealed will be incorporated into the Fair Trading Act along with some enhancements, Mr Boscawen said.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.

Thursday, June 09, 2011

On not thinking very hard about anything in particular…

The last post was when? April?

Actually, it is bad because we do have the parliamentary general election coming up; there has just been (well, a couple months back) a by-election resulting from the departure of Pansy Wong; there has been the reasons for her “retirement” as the local MP; there has been the consequential vacancy and by-election for the Council; and there has been a total non-event called “The Budget”. It is not as if “nothing” was happening!

The by-election? Well that went by default almost. There was no contest in truth; Nat begat Nat in the form of one Jami-Lee Ross. He has been a local Councillor since he was allowed to stand, and he is a reasonably non-obnoxious person. Is he likely to go anywhere politically? I can’t say that he has neither nga raho nor personality, but neither does he stand out as a future powerbroker. The size of his win was expected, simply on the grounds of the nature of the Botany electorate. The selection process prior to the by-election was very carefully managed so that the final selection (for the Party) was between Ross and a television gardening personality (who has fortunately been selected for the Blubberman’s electorate over on the Shore). That he is a politician is as much an accident of history as much as his qualification for the post. He has no specialty that he brings to the job other than having been Manukau’s youngest-ever Councillor.

More significant – in terms of the Nat’s selection process – was the fact that the final three or four did not include any Chinese, Korean, or South African. A fact that is remarkable only in terms of the nature of the local population.

Did I vote for him? Probli, seeing that I can not remember who I did vote for.

Where is all of this going?

Well, it really starts with a questionnaire that came through the mail, originating from JLR’s mailing list (that started two Council elections back when I was unwise enough to send him some suggestions for what he could do as Councillor). On second thoughts it may have been Pansy’s mailing list because I was unwise enough to communicate some thoughts on the nature of the real world to her as well. Nothing spectacularly original about the survey – no more than the standard Nat thing with “Botany” printed in the spaces where government forms traditionally have options available. SWMBO got a bit het because it was addressed to me personally, but then it was me that stuck my nose in the nats nest to begin with. I was very magnanimous and consulted her for responses to all of the questions ( :D ) and we negotiated our way through those. The questions I ”enjoyed” the most were to select which of the Nat’s actions on “law and order” I thought were “good things to have done”. The one’s I ticked were (from memory) “Initiatives on P” and “Increased police numbers” – that one even I can remember originated with the Labour lot rather than the Nats, but there is little harm in lily-gilding. The rest – things like penalising boy-racers, restricting gang access to public buildings, increased sentences…- all got the word “Joke” written alongside because that is what they are.

In fact, after two and a half years – almost exactly – that is just how this current government appears. Led by a Jonkey who established the highlight of his first term as PM playing the stand-up comic on David Letterman; abetted by a farmer acting the part of a Finance Minister whose financial management is just like farming - you plant it in the ground and spread as much fertilizer on it as you can afford and being a dairy farmer he has lots of the right kind free; a Police Minister who takes enormous risks in legislating for the destruction of boy-racer cars and preventing gang patches being worn in public buildings; a Justice Minister who is looking to prepare a White Paper that will propose the abolition of the Civil Division of the Justice system on the grounds that no one can afford to use it and because the Small Claims Tribunal is far more effective but who at the same time is totally against any admission that lowering the drinking age to 18 was a horrendous mistake; so the list goes on…

Our present parliament (I initially wrote “government”) is a joke. They are completely devoid of idea. There is already a very strong ordure of the past; the old ideologies of “selling state assets to reduce the deficit” have already been pronounced as the foundation of the Nat election campaign – by none other than the Jonkey and FarmerBill together. This from a government that is overseeing the borrowing of $500 plus million a week, to cover deficit funding requirements of less than $400 million and that latter number includes debt refinancing. The failed dogma of governments past are being heard; of Bolger, Shipley, even Muldoon’s ghost is clattering his chains in the basement of the Beehive. Even sadder, there is not much of a difference between them and The Rest. They are all of a muchness other than the colour of the flag they wave. The far right is being now run by an ex-Nat Leader who failed. The far left has become the plaything of a radical Maori who will be the next Peter Dunny (less the coif, of course!) if he can persuade the whanau to support him rather than the elder put up as his hopeful opponent in the by-election next week. The Jonkey and the Gofferguy play their own Tweedle-Deear and Tweedle-Dumb parts, alternating almost by the hour. The Grass gets Greener by the day, specially now that Tandos has gone. And Dear Old Uncle Jimmy; what would we be doing without him? Auntie Tari steams impressively into future irrelevance while Pita always looks as though any kapahaka group, anywhere, would provide far greater pleasure.

And this is the bunch from which we - the electorate - have to choose our government in about 5 months’ time. From the TV Gardening Guru to Tweedle-Dumb (the political equivalents of Vale and Valea) to the QuizMaster himself who misses not a chance to tick off a vagrant MP who dares enter the House without his permission to wear “inappropriate attire”.

What are the chances that there will be some sensible debate – like how to rescue those who have borrowed far beyond their means and do not qualify for the tax cut lifeline. With all the heat and bebotherment about PIGs and international financial crises NZ seems to stand unique. As far as I can determine, the “National Deficit” (other than the one described above) is something like 20% government borrowing and 80% borrowing for those myriad personal essentials like house, investment property, new second-hand Japanese people mover, and mobile phone. Steenkamp (of RBNZ) tells us -

Gross foreign debt to GDP peaked at over 130 percent in 2008... Banks are responsible for more than 60 percent of total gross foreign debt, which is equivalent to around 80 percent of GDP. General Government debt is a comparatively small portion of external debt. Since bottoming at the end
of 2006 at 8.9 percent of GDP, gross public debt increased to about 13 percent by the first quarter of 2010. On a net basis, public external debt stands at 6.7 percent of GDP and overseas bank debt is 64 percent of GDP.

That being the case, I (for one) can not help but get the very strong and uncomfortable feeling that the past three years of ennui and minimal activity has in fact been a season of planting. The hoped-for fruits are the public fears that the Nats will use in their election campaign; the need to sell public assets to reduce debt; the size of the public deficit and the need to curtail services; our total capitulation to US trade demands because of our future economic dependence on a FTA with them; the “need” to change employment laws yet again has already been announced. The list can go a lot further than that.

The most interesting thing for me, by far, is the plebiscite that will be held on the present electoral system. The original legislation was put in place with a sunset review clause and it may well be that we have run three years past that review. Regulars here will know that I am a strong and fervent supporter of MMP with the only reservation being that the number of list members could be reduced from 100 to 50. Yes, I know and understand that might complicate the mathematics just a little for the bureaucrats; they are after all accustomed to counting and addition rather than multiplication and division.