upton-on-line
11th June 2002
In this issue
The alimentation of French political parties and why
there are no fewer than 8,455 candidates at this weekend’s first round
of the legislative elections; more on the trans-Tasman institute
debate (this time from the Foreign Affairs & Defence Select
Committee and Sir Frank Holmes); Sir Hugh Kawharu
on tino rangatiratanga; and a deliciously nostalgic romp through
the debate about foreign investment in New Zealand circa 1975
featuring the nearly forgotten Geoff Datson and the perennial
Dr Donald Brash.
But first an obituary and a promotional pitch
The Obituary (for NZ-resident readers)
Upton-on-line announces the demise of his appearances on Radio NZ’s
Nine-to-Noon show aligned with the publication of u-o-l.
RNZ’s ‘new’ face, Linda Clark, is seeking brisk new judgements
from real Europeans on events in the Old Continent. NZ readers who have
e-mailed complaining that they are hearing about u-o-l before seeing
it can now desist.
The Promotional Pitch (especially for diasporan readers)
Upton-on-line warmly commends New Zealand Books, a review of
(what else) New Zealand books that appears 5 – 6 times a year. It is
a high quality publication now in its twelfth year. Its editors, Bill
Sewell and Harry Ricketts recently editorialised on the similarities
between their publication and the Times Literary Supplement that
upton-on-line occasionally commends to readers. The parallel they draw
is by no means unreasonable. Here’s how they characterised their aims:
"…as with the TLS good writing is at the heart of our
matter. We strongly agree with A N Wilson’s remark that "Of course
we would rather read a well-turned review than a dull book",
and we suspect that our readers would too. So the best of our reviews
should be as engaging and satisfying as a first-rate short story or
poem. By good writing, we mean vigorous prose and rigorous thinking,
crisp as a fresh salad, robust as a kahikatea: something as entertaining
as it is informative – and, if appropriate, with a dash of humour
… And, as editors, we see it as a significant part of our job to act
as literary midwives, who – miraculously – are not only present at
the conception by commissioning work and suggesting angles, but also
clean up after delivery to the point occasionally of ‘disinfecting
reviews of jargon’, as Ferdinand Mount [the TLS’s editor] so
astringently puts it. Finally, NZB aims for the same kind of
pluralism and fair-mindedness as the TLS. Though, naturally,
like the TLS we don’t always get it right. However, we like
to think that, as with dodgy umpiring decisions in cricket, things
usually even out in the end…"
Couldn’t have been written in Atlanta, could it? Or, for that matter,
Sydney.
If you would like to subscribe (it is a paltry NZ$50 overseas, $35
domestically) write to the Subscription Manager, NZ Books, Level
5 Old Wool House, 139-141 Featherstone Street, Wellington, New Zealand
or e-mail the editor at: billsewell@paradise.net.nz
Charging the political feed
troughs
An unprecedented 8,455 candidates
from 32 parties offered themselves to electors in the first round of
the French legislative elections last Saturday. When you consider that
the French electoral system is designed to weed out the small fry by
having a run-off second round in those constituencies (or circumscriptions)
where no candidate gets over 50% of the vote – only those with more
than 12.5% can take part – it’s hard for the outsider to work out why
so many good Gauls are lining up to be slaughtered. Until you dig into
the rules surrounding the funding of political parties, at which point
everything becomes clear – money.
Very simply, there are two troughs:
one for parties already in Parliament (45,398 euros per MP, per year)
and then one for every candidate (including the sitting MPs) which is
distributed on the basis of 1,66 euros per vote received in the first
round. It’s very simple – the more candidates you put up, the more money
you get (subject to some rules including a requirement to stand in at
least fifty seats unless you’re a regional or local party in which case
the money flows for just a single candidate). So even if there’s no
serious hope of getting past the 12.5% barrier, you can go for the maximum
nation-wide coverage (and hence publicity) safe in the knowledge that
extra votes will mean extra income.
The fabulous choice on offer
With rules like these, French taxpayers
have, if nothing else bought themselves a fabulous choice of parties
– une nébuleuse électorale as Le Monde put
it. Out there in electoral star clusters can be found 6 parties of the
right and 2 of the extreme right; 4 parties of the left and 4 of the
extreme left; then there are 2 republican parties, a regional party
(that is national, if you follow), 2 different parties especially for
the hunting/fishing/shooting types, 5 parties that can best be described
as single issue parties and a staggering 8 parties of varying shades
of green. On top of that, there are all sorts of independent hopefuls,
often carrying local parochial banners.
The names are occasionally Orwellian
(the Solidarity of Regions & Peoples Party) but more often turgid
- how about the League of French Taxpayers or the Man, Animals and Nature
Movement. Upton-on-line’s man-in-the-boulevard judgement is that
the further greenwards and leftwards you go, the smaller the print and
the greater the number of words on the campaign posters. If this correlates
with voter intelligence, M. Le Pen’s National Front won’t
have too many candidates for the Academie Francaise.
A minor trans-Tasman triumph
Readers may recall that earlier
this year, upton-on-line tried to arouse interest in the idea of some
sort of Trans-Tasman initiative to expose Australians and New Zealanders
to one another’s preoccupations before emerging differences required
the use of Döppler spectrography to measure rates of retreat. Readers
will also recall that apathy killed the cat, so to speak. Upton-on-line
is reliably informed that Australia’s High Commissioner in Wellington,
Paul Cotton, was unequivocal in maintaining that Upton had "lost
the plot".
Imagine upton-on-line’s surprise,
then, to find that no less a body than the Foreign Affairs and Defence
Select Committee of the NZ House of Representatives has also lost
the plot! For included in the report of its Inquiry into New Zealand’s
Economic & Trade Relationship with Australia is an extensive
quotation from this publication.
Specifically, the select committee
has recommended that:
3. …the Government establish regular
(at least annual) meetings of senior political, industry and academic
leaders, modelled on the Königswinter Conference, to focus attention
on the relationship from many perspectives, including but not limited
to parliaments, governments, business, academic and non-governmental
sectors of society. The 20th anniversary of CER in 2003
would be the obvious time to launch such an initiative.
6. …the Government discuss with
Australia establishment of an ANZEC Institute on both sides of the
Tasman. The Australian branch should be funded by the New Zealand
Government, and vice versa. This institute would be an advisory ‘think
tank’ like Asia 2000, having a strategic responsibility to facilitate
ongoing work across all sectors. Analysis to assess outstanding issues,
leading to a study to determine the viability of various currency
union options, could be the institute’s initial work programme.
It remains to be seen whether politicians
and officials on either side of the Tasman have the recklessness to
lose the plot as well – or whether we will slumber on in the belief
that contemptuous familiarity will tide us through.
[The full report can be found at:
http://www.clerk.parliament.govt.nz/content/706/i4e.pdf
Be warned: it is a large report and down-loading it is like asking for
an illuminated manuscript]
Sir Frank joins the fray
One who is not affected
by the torpor that normally envelops debate over New Zealand’s external
relations is Sir Frank Holmes. Indeed, Sir Frank’s restless and
constructive mind has probably done more to keep debate alive on the
nature of the trans-Tasman relationship than anyone else has. In a recent
paper published by the Institute for Policy Studies at Victoria University
discusses the case for an ANZAC union. The full paper can be found at:
www.vuw.ac.nz/inst-policy-studies/policy_papers/Policy_Paper_14.pdf
It contains an exceptionally
useful distillation of recent contributions and some of the key facts
about the relationship. Here are a few:
- From 1858 to 1965, 124,000
more people moved from Australia to New Zealand than vice versa. The
flow has reversed since with about 450,000 New Zealanders now resident
in Australia (as against 50,000 odd Australians resident in New Zealand).
- During the 1990s, arriving
New Zealanders accounted for about one third of the net permanent
and long-term arrivals into Australia (with the result that New Zealanders
accounted for about 40% of Australia’s planned migrant quota)
- New Zealanders resident
in Australia pay about $2.5 billion per annum in taxes yet represent
a stock of human capital educated at the expense of New Zealand taxpayers
(which raises interesting questions about the coherence of Australian
concerns about arriving kiwis as a drag on their society).
- The combined GDP of
the two countries is equivalent to that of ASEAN.
Sir Frank’s prescription
is customarily sane and sage. He supports a proper assessment of the
two countries’ regional priorities as the basis for shared defence priorities.
He believes we should resist as irrevocable Hugh White’s conclusion
(quoted previously in upton-on-line) that New Zealanders don’t even
want to be on the same bus as Australia when it comes to regional defence.
He believes that working co-operatively on defence is fundamental and
that "the two countries working co-operatively … can achieve more
than if New Zealand were merely a state of Australia and certainly more
than if we continue to drift further apart on defence and security issues".
He calls for more compatible policies on immigration and gives a nod
in the direction of a sort of council –of-the-wise ginger group to focus
on regional issues.
His final conclusion is
as follows:
"I do not see political
union as a practical possibility for some years ahead. But I believe
that both Australia and New Zealand will gain if we continue to progress
towards a less far-reaching and more outward-looking union. We should
continue to aim to create a real single market, to co-operate effectively
on issues of defence and security in the region in which we live,
and help one another to overcome the international disadvantages of
relatively small size in the public sectors of our societies."
But upton-on-line found
another judgement more revealing:
"In the absence
of a crisis, the vision of political union between the two countries
seems unlikely to emerge from political leaders currently holding
office or leading the Opposition in Australia."
Undoubtedly true. The same
holds for New Zealand. The key words are "in the absence of a crisis".
In upton-on-line’s judgement, New Zealand is rather good at coping with
crises. But until they come along, day-today hedonism seems the preferred
strategy. That strategy has allowed the gap in living standards between
the two countries to widen steadily since the 1960s. One wonders just
how big a gap is needed before we trigger a ‘crisis’. And then, what
sort of door will be open on the other side of the Tasman. As upton-on-line
concluded in an earlier edition (cited by Sir Frank), "let’s hope
we don’t all meet at the visa application counter one day".
Further insights on rangatiratanga
A correspondent has helpfully
drawn upton-on-line’s attention to the report of the Waitangi Tribunal
on the Kaituna River claim in which the opinion of Sir Hugh Kawharu
is cited on what it was Maori understood by tino rangatiratanga.
In Sir Hugh’s opinion, the nearest one can get is "all the powers,
privileges and mana of a Chieftain" or, even more succinctly, "chieftain-ness".
Here are the key extracts that quote Sir Hugh:
"…Customarily the
Maori has had his options shaped almost as much by the oratory and
the reputation of those whom he listens to on the marae as by the
merits of the options themselves. This would certainly have been the
case in 1840. Thus the missionaries’ reputation as honest men, reasonably
coherent in the Maori tongue and knowledgeable in the ways of the
European enabled them to persuade the Maori to sign the treaty with
a degree of success far beyond that which any others, particularly
Hobson, could ever have achieved…"
"…the major problem
arising from the first Article turns on the issue of sovereignty,
a system of power and authority (as would have been intended by the
Colonial Office) that was wholly beyond the Maori experience, a network
of institutions ultimately to comprise a legislature, judiciary and
executive, all the paraphernalia for governing a Crown Colony."
"The Maori people’s
view on the other hand could only have been framed in terms of their
own culture; in other words, what the Chiefs imagined they were ceding
was that part of their mana and rangatiratanga that hitherto had enabled
them to make way, exact retribution, consume or enslave their vanquished
enemies and generally exercise power over life and death. It is totally
against the run of evidence to imagine that they would wittingly have
divested themselves of all their spiritually sanctioned powers – most
of which indeed they wanted protected. They would have believed they
were retaining intact apart from a licence to kill or inflict material
hurt on others, retaining all their customary rights and duties as
trustees for their tribal groups…"(Pars 4.8-4.9)
Paragraph 4.10 of the report
is particularly interesting:
4.10 The guarantee of
their "rangatiratanga" was associated with the grant to
the Crown of the right of pre-emption by the Crown of such lands "as
the Proprietors thereof may be disposed to alienate" (Article
II). Professor Kawharu is of the opinion that this would not have
assumed much importance for a Maori Chief in 1840. He goes on to say
"…(it) is essential
not to lose sight of the quid pro quo of the Treaty; that the collective
surrender to the Crown of the power to govern was made primarily
in return for the Crown’s protection of each Chief’s authority within
his tribal domain…"
The right of pre-emption
certainly became important later. When the Maori sold his land to
the Crown for sixpence an acre and the Crown then sold the same land
to settlers, almost immediately, for ten shillings an acre the Maori
began to see unfairness. If the land was worth ten shillings an acre
why was he not paid that price? The truth is, of course, that this
policy was adopted to provide the Colonial Government with revenue
– to Maori eyes, at the expense of the Maori."
Sir Hugh’s account seems
perfectly sensible to upton-on-line. Certainly, it does not support
the notion of a sharing of the same sovereignty. Rather, it supports
an element of dilution in chieftainship (the cession of the right to
make war etc); more strongly, it supports the conclusion suggested in
these pages that the parties (perhaps not so very surprisingly) did
not understand the same concepts in the same way. None of which leads
to any inevitable conclusions.
The full report of the
Tribunal can be found at:
http://www.waitangi-tribunal.govt.nz/text/wai004/doc007.html
Echoes from another age
Upton-on-line’s attention
was recently drawn to a slender publication by the NZ Institute of
Public Administration dating from 1975 entitled Foreign Investment
Policy in New Zealand. Its slightly faded pages induced, for him
at any rate, an almost Proustian reverie of the world before Rogernomics
(if economic history is capable of being Proustian). Here was the leading
edge of intellectual debate on New Zealand’s economic direction in the
slack water between the 1967 nil wage order and the first hesitant attempts
at de-regulation by Sir Robert Muldoon in 1976. Globalisation
hadn’t been heard of and upton-on-line was safely sitting bursary.
Therein we encounter the
young(ish) Roderick Deane in fine form, vanquishing the phantoms
of central planning ("an economist could be excused for doubting
whether the bureaucrats are the best judges of the national interest
when inhibiting the flow of funds at a microeconomic level").
The contribution from the
Prime Minister of the day, Rt Hon Bill Rowling, glows with the
sort of idealistic nationalism that sent frigates to Mururoa:
"We begin, now,
from a point where our history and our policies have generated a level
of overseas control which is excessive in relation to our aspiration
to be an independent nation, initiating and shaping our own economic
future. This aspiration is primarily nationalistic. That I admit,
frankly and unashamedly. It stems from a rapidly maturing sense of
national identity whose further development is very close to the centre
of my Government’s objectives …
"This vision is
by no means a new one. But we are today coming much closer to its
fulfilment. Not least of the foundations for this claim is the maturing
of the post-war generation, a generation educated, travelled, undogmatic,
and positive in comparison with the previous generation. These people
are just now assuming key creative and decision-making responsibilities,
but their influence is already making an impact in our national life.
The nationalism of this generation is comparatively low-key, but it
is definite and rooted. Its impulse will have a profound effect on
the direction of our economic, cultural and social development."
(p.19)
Little did he know what
revolutionary (and frequently ideological) prescriptions this ‘undogmatic
and positive’ generation was about to unleash. If breathing in the stifling
atmosphere of the electric blanket approach to industry protection is
your particular nostalgia, it is hard to go past the paper by Geoff
Datson, then Deputy Secretary of the Department of Trade and Industry.
The complacency and sense of economic self sufficiency is overwhelming
even when Datson is finding arguments not to slavishly imitate the industrial
development policies of other countries: "I doubt whether we are
the kind of society that would want to copy other people’s mistakes,
especially in the human and social areas." A judgement direct from
the Olympian heights of Sutchian utopia.
Most revealing is Datson’s
astonishingly smug view of New Zealand’s technical prowess. Despite
graciously conceding that "overseas investment can in some cases
be a stimulant to the growth of indigenous technology", his account
of New Zealand technology as something springing from exclusively New
Zealand insights and motivations made it sound as though we were in
a different universe:
"Let us look at
… industrial and professional electronics…
"It happens that
many of the innovators, and successful ones, of new electronic devices,
or mechanical equipment associated with the field, are of New Zealand
origin. I am thinking of the equipment for polarisation of ion sources
for use in nuclear research; of the binaural sonar spectacles for
use by the blind; of the multi-stylus recorder; of the monitor for
ambulant heart patients. These are exclusively New Zealand developments,
arising from New Zealand needs and conditions – except for the ion
source equipment which arose from a Rutherford-like objective interest
within the Physics Department of Auckland University.
"Now I should follow
on by saying that in two of these cases the work was further developed
by companies with overseas parents. But my point is that the technology
– and very desirable technology – originated in New Zealand and could
have been developed by an New Zealand company here with management
as good as the New Zealanders who ran the two overseas-owned subsidiaries
I mentioned …
"I am not exaggerating
when I say that New Zealand is brimming with original technology,
especially arising from our own conditions, but highly relevant to
countries like ours in Asia and elsewhere which are glad to take our
exports in preference to others because no one else has exports like
them…"(p.31)
Identifying areas of indigenous
strength such as dairy equipment and vaccines as "examples of the
wisdom of concentrating on and selecting the kind of research and development
work most suited to us" Datson gravely concluded:
"I see no need for
foreign technology here. Although I recognise that foreign investment
has made a contribution, this was not an essential element in the
industry’s development." (p.33)
Datson even found room
for a spot of aesthetic nationalism (although upton-on-line can’t recall
it unless it was all those dreadful chocolate brown carpets and orange
plastic chairs that invaded public spaces in the 1970s):
"A New Zealand designer
will design for New Zealanders and – as with Scandinavia and other
areas – we will find that some other people like our designs too.
Products are made for people in their own environment. The worst form
of design is thumbing through an overseas catalogue to see what might
be saleable here…"
All one can say is: Thank
God New Zealand wine makers decided not to pursue the palettes of Cold
Duck drinkers but immersed themselves, myopically, in learning everything
there was to learn about the ultimately subjective goals of some of
the greatest wine producers around the world – and choose them as the
standard to be beaten.
This is of nearly archaeological
interest today. More intriguing is the paper by Don Brash, then
a thirty-something rising star in the financial sector as General Manager
of Broadbank. In his NZIPA paper, Brash recounts his (oft since
repeated) Damascene conversion from the autarchic analysis of Wolfgang
Rosenberg to market liberalism. His prescription – then very much
at the leading edge – has become the orthodoxy and Brash would probably
stand by almost everything in the paper he wrote then. But its closing
paragraph caught upton-on-line’s eye:
"As the General
manager of New Zealand’s most Mew Zealand-owned merchant bank, which
has a parent company that is proud to be wholly New Zealand-owned,
I am the last one to deny the strength of nationalism. I think we
must advise Governments to be more rational, and must assist Governments
in that goal by educating the public at large to the real issues.
But it might also be relevant to note that attitudes to foreign investment
in New Zealand may mature only when New Zealand companies themselves
expand internationally, when we have more companies like New Zealand
Insurance and South British Insurance, and to a much smaller extent
at this stage such companies as Broadlands and U.E.B., raising the
national flag abroad. It seems significant that there is very little
resentment against foreign investment in Switzerland, which has spawned
a number of major international firms, and comparatively little resentment
in the United States, which has spawned even more. This possibly
suggests that it would be desirable to protect from takeover by overseas
companies those rapidly growing New Zealand companies which might,
given time, expand overseas themselves – even though such protection
would not be economically rational in itself."
Thirty years on, the companies
mentioned have long since vanished. In the intervening years, we both
pitted our best management against the world and opened our doors to
overseas investment. If it was a test of managerial skill, the outcome
was a sobering one as a succession of (once) rapidly growing New Zealand
multi-nationals like Fletcher Challenge pursued their various paths
to the destruction of shareholder value and eventual off-shore acquisition.
How, one wonders, does Brash feel today?
In his first speech as
a political candidate recently, he touched on a subject that has haunted
him for some time – the chronic lack of savings that sees New Zealand
continue to support its lifestyle through borrowing. Here’s an excerpt:
" …as individuals
we are increasingly unable to afford the goods and services which
people living in more affluent societies take for granted. For a time,
we will no doubt try to keep up our standard of living by borrowing
from foreigners, as we have increasingly done in recent years. But
we are already more heavily indebted to foreign creditors than any
other developed country – and possibly more heavily indebted to foreign
creditors than any other developed country has ever been. Without
faster growth in what we produce, either our debt to foreigners is
going to keep going up or we are simply not going to be able to afford
to buy the things that those in more affluent societies buy."
Of course, selling assets
is the other way to maintain lifestyles, and New Zealanders haven’t
been averse to that either. Brash is scarcely going to argue for a return
to controls which would be the ultimate admission of failure (and wouldn’t
work any way). But he has always been acutely aware of the long-run
social and political consequences that can erupt in a society that is
chronically unable to manage itself with the long term in mind and,
by living for today, mortgages control over the future. The single
most interesting thing about politics on the centre-right of New Zealand
politics over the next three years will be the extent to which Brash,
come down from the Paradise of central banking to the Purgatory of politics,
will tackle this concern and attempt to focus public debate on what
is at stake.
[Brash now finds himself,
for the second time in 25 years trying to enter Parliament – something
that has so far proved for more difficult for him than any of the far
more technically demanding tasks he has attempted in finance, kiwifruit
or monetary policy. A man of enormous intellectual and personal integrity
amidst a sea of mediocrities, and one of the most outstanding New Zealanders
of his generation, upton-on-line wishes Dr Brash well on his daunting
quest]
The invisible editor
Standing guard over the
debate, and author of the introduction, was Richard Carey. Described
in that era as a "senior investigating officer" in the Treasury
(do they still have such creatures), Carey trod a careful path designed
to allay any fears of imminent upheaval or ideological rancour. Having
deftly noted that governments of both left and right to have swallowed
their ideological principles on the matter of foreign investment, he
calmly predicted no major changes in the direction of New Zealand’s
foreign investment policies. But even then it was apparently kosher
for Treasury officers to have a swipe at Dr W B Sutch. Here is
his cursory appraisal of Sutch’s philosophy:
"Dr Sutch … has
relied very little on formal economic analysis. His arguments basically
amount to a radical critique of New Zealand’s social and political
evolution since the 1930s. This is made particularly clear in the
initial chapters of his [then recently published: 1972] book
Takoever New Zealand. Indeed, it is doubtful whether Dr Sutch
would regard any conventional economic analysis as relevant. ‘The
struggle is between the strong and articulate who want the old colonial
system, and the rising generations who are victims of the philosophic
superstructure of the nineteenth century’. Dr Sutch is passionately
convinced that New Zealanders had the potential to grasp control of
all sectors of the economy in the 1930s and to develop a unique and
beneficent society with a strong national identity and under fairly
complete national control. Whether this aspiration ever had any possible
prospects of becoming a reality is beside the point: the concept is
an appealing one to many and the autarchic policies advocated on the
basis of it have enjoyed wide, if somewhat uncritical support."
All good fun. And even
more so for upton-on-line who has unearthed this saucy official here
at the OECD where he has devoted the last XX years of his life
to the equally contentious field of development economics. Richard has
agreed to feature in the next issue as Diasporan of the Month.
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