Friday, September 23, 2005

Current Account Deficits

There has been a bout of recent posts from right wing bloggers stressing about our current account deficit. The nice analysis from Farrar was this: "Now let's debunk Dr Cullen's logic. If one actually gives NZers some of their own money back to them, this will allow people to save more!". Well, it also gives them more money to spend... and rich people tend by buy expensive luxury goods from overseas.

Regardless, that's not important. What is important is that current account deficits are not bad, for two reasons. Firstly, and most importantly, they don't exist. When New Zealanders buy, say, $1000 worth of goods from overseas, we have bought goods, and the overseas sellers have bought our money. An economy as a whole cannot bleed currency - it can bleed currency value, but current account deficits would have us believe that our economy's cash will simply dry up. It won't.

Secondly, and this is how we get current account deficit figures, is in various areas. Trade of merchandise may be negative, while service trade may be positive. Regardless, current account deficits are just the formulation of the expected effect on the economy in the future. If a country has large current account deficits, it simply means that its dollar is too high. A high dollar is generally good for importers and bad for exporters. A high current account deficit simply means that New Zealand's dollar will be weakened, meaning that the economy stabilises. It's simply the marking realigning with equilibrium.

Update: I didn't make it clear enough above that the surpluses in other areas of which I spoke was of course the capital account. A current account deficit just means that as a country we are importing capital. Get over it.

Hide's Blog

Am I the only one who has been disappointed in the changing nature of Rodney Hide's blog? In terms of quality, it was never particularly high up there when it came to analysis and principled explanations, yet its recent demotion to the flagship of Hide's electoral win seems a little Dunne-esque. I have yet to see a post where he does not mention how the media and pundits were wrong, he was right, and here's a link to [Insert journalist here] eating their words (or in the case of Armstrong, not eating them publicly enough for Hide).

I voted for ACT because it's ACT, in the same way that those who voted for United Future did so because it was Peter Dunne. Time to move on I think, and start doing something of worth.

Thursday, July 21, 2005

Foreign Policy

There has been a bit of a brouhaha of late vis à vis National's foreign policy and the independence thereof. Many have predicted that a National government will be the end of an independent foreign policy, to be replaced by one that sees America dictate to us how we are to act.

Several things. Firstly, there is an obvious distinction between independence and agreement that these people miss. If National decided to go to Iraq with America, that in now says that our foreign policy is no longer independent. We could have decided, independently, that the ousting of a tyrannical dictator was a move that was beneficial. Or, perhaps more cynically, decided that such a move may help us in terms of our relationship with America. Regardless, in both these instances a choice is made by people independently, without coercion.

Secondly, presuming for a second that the people who say it would be a move away from independent policy, what is the logical extension of this? Is it to say that we cannot agree with anyone, since to do so is to no longer have an independent foreign policy? If we agree with America, and that isn't independent, then why isn't it the same if we agree with France, or Germany? Surely the fact that we sided with them over Iraq is equally dependent? It is clear then that their argument is disingenuous.

Wednesday, June 01, 2005

Greens Flip-Flop

From my bout of recent postings, one would think that I hate the Greens. I don't. I quite like the Greens when it comes to social issues. I guess one invariably talks of the Greens though when you have a series of slow news days.

So, the Greens have decided to support the Government in its Prisoners and Victims Bill. Their justification for this is because to not support it would mean that Labour would have to fold to United's demands of first of all, all compensation being paid to the victim of the crime, and secondly, a prisoner having to exhausted all other extra-court avenues. In turn they trumpet the bill now since they have got an independent prison inspectorate, and, what surely is the best thing this bill could ever have, a sunset clause. More information here.

I disagree with Idiot/Savant's analysis here, which sees the bill as a success in that it has wrenched it from the more extreme clauses which United wanted. Here's what the Green Spokesman on Justice, Nandor Tanczos, had said on the bill earlier:

Green MP Nandor Tanczos says the Government’s proposals to control prisoner compensation are political crisis management that may have dangerous unintended ramifications for justice in New Zealand.
Perhaps it was put more strongly by Keith Locke, when the Ministry of Justice suggested it would appeal decision by the court awarding compensation:

Green MP Keith Locke says threats by the Justice Minister to appeal compensation awarded to five prisoners for severe illtreatment send the message that prisoners have no human rights and ‘deserve’ whatever brutality they encounter in jail.
I agree with Locke, as I see the most important issue here that prisoners are being abused to the point that they can get compensation awarded by a court - not that compensation is paid to prisoners. If we allowed such treatment of prisoners under law, then they would of course not be awarded compensation. We don't, and we shouldn't.

The Greens have effectively allowed parts if not all of future compensation to be paid to the victim, which raises two issues in my mind. Firstly, why is it that prisoners, who have been kept in solitary confinement described as a 'box', not been allowed out to go to the toilet and been told to use a corner, do not deserve compensation? Secondly, why is it that the victim does? Now, I know that victims of crime may experience trauma and the like. But this is an argument to compensate all victims of crime - not just those who were victimised by people later tortured or punished unusually.

More and more in my opinion do the Greens seem to going against their principles. Yes, NRT is correct saying that it could have been worse. What they should have done though to stick to their principles is criticise and publicise accordingly. A party that is supposedly founded on ideals should not cut and run for 'better deals'. This isn't a way that the Greens act often. They didn't say "Ok, maybe not a moratorium, but why not just 20 plants a year". They didn't and they shouldn't have.

The only reason they are changing now is to try to demonstrate to the government and New Zealand that they have legislative nous and that they will not hold a government to ransom. Dunne has been claiming he is the moderating party and been attacking the Greens. This is now just their way of providing proof that they know realpolitik

NBR's Flawed Analysis

The National Business Review's Blog had a post here on the Epsom electorate seat. After saying that Worth's list place will mean Epsom voters may decide they can vote for Hide after all - perhaps meaning Hide brings more MPs with him, they predict he can win:

"[T]he relatively narrow margins by which Rodney has failed to gain the seat suggest only a small swing - on the back of a "Worth is safe" campaign - will be required for Rodney to win Epsom at the next election."
This is completely wrong. The official Epsom results show that Hide, in 2002, placed 3rd in the electorate. From my calculations here are the main four candidates:

Richard Worth - 42%
Di Nash - 24%
Rodney Hide - 22%
Keith Locke - 6%

Now, presuming that Labour and the rest gobbled up a similar share and divided it similarly, there would need to be at least a 10% swing towards Hide from Worth for him to win. It's not impossible, but it's not the "small swing" they suggest is required.

Tuesday, May 31, 2005

The State of the Environmental Movement (Cont.)

To present a better example than perhaps I did below, I have fished out one of the pamphlets I received at the lecture I talked of below. Headed up with "It's time for some fresh thinking", by the end of reading the page below, you are bound to agree with the heading more and more. The point of the pamphlet is to illustrate the Greens are more than just a student party, saying "Tackling tertiary issues is one part of a much larger challenge".

It offers three areas that the challenge can be broadened to: "Sustainable Economic Development", "Green Energy Future", and "Environmental Protection". I'll take a look at what they say under the second issue:

"Maui gas has nearly run out, most of it wasted. World oil production will soon peak and decline. We don't want all our rivers dammed. It is time for a power-shift to a Green energy futureby cutting energy waste and working with nature's power.

The Greens say that to secure our future we must reduce our dependence on fossil fuel. A Green future would have us using energy efficiently, developing renewable resources, and living within the limits of the planet"
All very nice indeed. But they are scant on exactly what the Greens say the media don't report - their solutions. "[U]sing energy efficiently" is a nie soundbite, but it's not a policy; it's a mantra. Now presumably somewhere the Greens do say how - but in their publications that actually get out they do not. Instead, the leaflet points to their website,

Turn the leaflet over though, and you get clear policy on one area they do seem to care about: student debt. Of course the Greens are politically motivated in this - with students voting the Greens in record numbers. But clear policy directives here like "Cap fees at $1500" and a specific website,, show that they know what is important - and perhaps it's not stressing their solutions to environmental issues. So next time frog says that the media don't report their solutions, one has to wonder why the Greens themselves don't.

The State of the Environmental Movement

I read with interest Colin James' article about the changing view within the Greens organisations worldwide, and even more interest the Greens' reply at their blog. In my opinion frogblog is generally a very decent blog, which provides a good analysis from a Green perspective of issues. Perhaps more importantly, I think it is better at furthering the ideology of the Greens than say Rodney Hide's blog is at furthering that of ACT's. I enjoy both.

But their reply to James' article I believe is largely disingenuous and rather politically calculating in areas of the article it wishes to attack. James says this of the Greens upcoming conference (where I'm sure we all hope to see more Morris Dancing):

A different sort of green literature has developed in the past few years - and it is not the sort the Green Party will happily hand out at its conference this weekend.

This new literature began in 1998 when Bjorn Lomborg, once a deep green, began questioning the assumptions, methodology and statistics of orthodox green positions. Lomborg still claims to be green (as the Business Roundtable found when it brought him here to speak), but a skeptical one.
James is of course referring to Lomborg's "The Skeptical Environmentalist", which challenges conventional Green thinking by providing statistics which show the state of the Earth in a far nicer light than conventional Greens would so desire. Regardless of whether or not you agree with Lomborg, the Greens' attack on James' point misses the boat completely:

James is wrong if he thinks debate isn't happening within the Green Party about the nature and future of the environmental movement. One of the most lively debates on the Green Party members' forums in recent months has centered around two pieces of environmental movement navel-gazing emanating from the United States: the first called "The Death of Environmentalism" and the second called "The Soul of Environmentalism".
Now, that's fine that it may be going on in the members' forum, and great that the members can indeed read. What I, and I could be missing something here, am still waiting to see from the Greens is some challenge of Lomborg's views. James' point still remains: the Green party will not hand out Lomborg-esque literature. Exempli gratia, I sat through an interesting lecture provided by two of the Greens' media team, in which Green literature was handed out on 'peak oil' and student debt.

The frog then goes on to try to blame the media who do not publish their solutions to problems - only the problems themselves. This is a problem that many minor parties find themselves in, as illustrated perfectly by Kim Hill's interview of Rodney Hide. She lambasted him for not being a "statesman", until he pointed out why he was there on the show, asking her "Why did you invite me on tonight Kim?". The answer of course was because of the scandals. He then proceeded to use the opportunity for explaining ACT's vision.

In this respect I think it is fair for minor parties to feel hard done by - the Greens get no headlines "Income Tax of 0% on first $5,000 by International Earth Day" like main parties seem to manage (whether or not those parties so desire those headlines is beside the point). But by the same token, blaming the media is surely just another case of illustrating the negatives, as opposed to getting the positive aspects across.

James' second criticism of the Green movement is that they are easily tainted with the brush of extremism and as such many of their views, even their good ones, are ignored by the populace. This is already occuring, or at least people are trying to taint them, as the blog itself noted when it discussed United Future's attacks on it here. I think that James' point here is true to a degree - as true as other parties painting ACT as 'extreme right-wing' serves to portray them in a negative light.

I do applaud the Greens since they are willing to accept, as frog goes on to say, that utilising the market is fundamental to environmental issues. However, when reading their piece a while back on the Economist article about market solutions to environmental problems, they seem to have things the wrong way round. They agree with the view that the market can solve many environmental problems. Yet the part they praise and emphasise is the government regulation that provides for the market. Now both are important, but I think it also means that they get tainted with the 'regulate' brush as well. I think the media would be willing to publish articles and discuss a Green party's solutions more often if they served to dispel the myths surrounding the Green party by more strongly advocating the market solutions, set up by legislation. After all, it was similar discourse in America that won the argument in the Senate over how best to deal with sulphur emissions - resulting in tradable sulphur credits. Similar aspects of Kyoto are to be applauded.

At the moment, the Greens are not vociferous enough in their support for market solutions.

Wednesday, May 25, 2005

ACT's Tax Policy

While for the most part I agree with ACT's tax policy, there is an element that has had very little mention. The area of interest for me is, as the Scoop press release summarises: the "Taxpayers bill of rights, and cap on real government spending per capita". The Dominion Post at least explains it a little better:

"ACT said it would introduce laws that allowed rises in total government spending to cover inflation and population growth. Other increases would need the approval of 75 per cent of MPs, but cash could be moved from one area to another within the limit."
I think it is important to note that New Zealand's laws at the moment only have one entrenched law - that is, a laws that requires more than a simple majority of MPs to vote for it to be passed. This is found in the Electoral Act. It is also imperative to note that the clause that entrenches this area of our law is in fact not entrenched. This means that a Parliament who had 51% MPs in favour of changing the entrenched clause could - first of all by getting rid of the clause that entrenches it, and then by changing it accordingly.

The problem that I have with entrenchment in general is that it binds the power of future Parliaments. New Zealander's understand and seem to support the idea of Parliamentary sovereignty - that is, the idea that Parliament can pass any law it wants. Checks on this power exist in the form of elections, select committee, public opinion, and Parliament itself. An entrenched law distors Parliamentary supremacy.

While ACT knows they are highly unlikely to put their policy into legislation, it does not excuse it. A party that supposedly stands for freedom, liberty, and democracy, is here flouting the very values it espouses. If in 20 years time a majority of the people wanted to remove these caps, unless they had a 75% majority, then their hands would be tied. It denies the freedom of the people to choose representatives who work for them - since it contrains those representatives to work for the majority of people unless large. It denies Parliament's liberty to pass laws that it sees fit to. It distorts democracy by placing value judgments on law, as opposed to the judgment of the people.

To demonstrate the hypocrisy of the ACT party, consider a Labour party who decided some of their policies were so good that they would entrench them. They would force successive governments to, say, pay for an annual Hip-Hop tour. Now ACT would obviously say firstly that this policy was ridiculous (which, I note, they do not seem to say so loudly about the Government subsidies for the NZSO), and secondly that it undermines the ideals of democracy. They should hold their own policies to similar scrutiny.

Potential Bullies

I note with interest that the media's attention around Benson-Pope moved from the scandal itself to the question 'Wwho else out there may be embroiled in similar scandals?' Given the high proportionality of Members of Parliament who were once teachers, this is a perhaps a pertinent question. The media have yet to look at who did indeed serve as a teacher when corporal punishment was legal. So, who may find themselves in a Benson-Pope-esque scandal?

Pete Hodgson served our nation as a teacher. If he were clever, he could have combined the roles of teacher and one of his other previous occupations: meatworker. Finding a suitable hook would just be a corridor away.

Chris Carter is another MP who could find himself under scrutiny from media. It's hard to see him as a bully - just as it is for Marion Hobbs, who also served as a teacher.

Surely though the most damning accusation would fall on the opposition? After all, to call Benson-Pope on the claims, only to then find one of your own ilk accused of similar, would certainly be embarrassing.

One obvious member springs to mind: Gerry Brownlee. He served as a woodwork teacher at Ellesmere College and later St. Bede's (which he also attended) in Christchurch. The Wikipedia entry on Brownlee describes him as "confrontational" and says that he has an "aggressive style of politics". While none of this suggests that he indeed did anything wrong in his teaching years,it is interesting to note that a Court ordered him to pay damages to a protester whom he threatened.

Perhaps just as interesting however is that Brownlee is seen as National's 'mad dog' in a way. ACT has Hide, NZ First has Mark and Peters. Yet the accusations were made not by Brownlee, but by Judith Collins and Rodney Hide. Judith Collins is hardly seen as a muck-raker - moreover, she is not even their spokeswoman on education. So it does seem a little odd that Brownlee has no association with the issue through either a press release on scoop and even more oddly, has never been recorded talking about it in Hansard.

Be interesting to see if this Sunday's paper turns up anything.

Tuesday, May 24, 2005

Statement of Intent

I intend to keep this simple. The purpose of this blog is to try to uncover and bring to light issues the main parties, and thus the media, tend to miss. As such it will attempt to provide in depth analysis of select issues, as opposed to coverage of the quotidian affairs of politics. That is all.