Some years ago, when John Key was prime minister, I read in “North and South” an article by the magazine’s chief sub-editor Graham Adams (a very fine, perceptive journalist) in which he wrote of John Key’s economic management as follows:- “After almost six years of Key’s tenure, the government’s net debt has topped $60 billion and according to Treasury predictions, will peak at $70.3 billion in 2016-7”
Earlier the article said “Key is touting himself and Bill English as prudent financial managers -all the while ignoring the $27 million a day they have borrowed on average since taking office.”
Apparently the debt was a mere $10 billion when the Key administration took office.
There are other aspects to the trade deficit. So often the media lauds export earnings but largely ignored are the costs of imports. And those imports comprise an extreme range of quality from high class to frankly, “junk”. The consumer has a bewildering, mesmerising wide choice which leads to a consumer driven society with consumerism rampant amounting to “affluenza”.
Local manufacturing suffers unable to compete with cheap, imports often produced with “slave labour.”
Ironically, governments complain about New Zealanders’ inability to save, yet it is government economic policies that stimulate spending by way of extravagantly flooding imports into the country under much vaunted free trade deals.
Would any sensibly operated business, farmer or even a humble household operate at a constant and continuing loss, spending more than it earns, because the inevitable result – sooner or later – is bankruptcy?
Borrowing
But on borrowing it wasn’t just John Key, Jacinda Ardern and Chris Hipkins that racked up debt in spades.
Turn the political clock back and back to 1984 through the governments of Helen Clark, Jim Bolger, Jenny Shipley and to the 4th Labour Government elected in 1984.
In 2015 Professor Jane Kelsey of Auckland University, wrote between 1984 and 1993, NZ’s foreign debt had quadrupled.
It was in 1984 that the 4th Labour government led by David Lange, launched a neo-liberal economic policy known as “Rogernomics” which featured heavy borrowing and a free market approach.
“Rogernomics” impacted on people. The social failure emerged with an increasingly arrogant, aggressive society and the costly social consequences of trends like escalating crime, high suicide rates particularly with young people, corruption, growing, costly bureaucracy and others.
Yet New Zealand was quite different back in the 1970s. To be fair, previous to 1984, the two governments under first Labour’s Bill Rowling and then National’s Rob Muldoon did borrowed substantially.
Previously to Bill Rowling”s inept leadership, the two governments – National’s Keith Holyoake and Labour’s Norman Kirk – had unemployment almost non-existent and the country profit-driven with exports generally earning more than imports.
But the introduction of the right wing “Rogernomics” economics under the 4th Labour government, carried on by the Bolger, Shipley, Clark, Key and Ardern-Hipkins governments has resulted in the financially failure of running NZ with neo-liberal economic policies, a deep social impact on the nation’s psyche and the outdoors and environment.
Failed Experiment
Only NZ First’s leader Winston Peters has referred to the failure, both economically and socially, of the “neo-liberal” economic management. If my concerns are justified and as a swinging voter, that augurs well for an end to the neo-liberal experiment that worships Gross Domestic Product, i.e. GDP. and has failed.
Then there’s the economic and social failing.
People are concerned according to recent surveys which reveal most New Zealanders think the country is heading in the wrong direction.
A Stuff online survey shows 70 percent have no faith in the idea that either National or Labour can make the country any better after the November election.
New Zealand measures the country’s progress by system known as GDP i.e. Gross Domestic Product. GDP has been, in single minded fashion, idolised by governments since 1984.
However, some economists have become alert to the myopic adherence to GDP. GDP was first developed in the 17th century and has evolved to be the unrestrained pursuit of growth.
One economist who has advocated ditching GDP is Kate Raworth an English economist who is Senior Associate at Oxford University’s Environmental Change and Professor of Practice at Amsterdam University of Applied Sciences. Her book “Doughnut Economics” calls for an economic model that “balances between essential human needs and planetary boundaries.”
It is obvious to anyone that growth for growth’s sake has achieved nothing. It is akin to a dog chasing its own tail and has resulted in a deterioration in the quality of life.
Worshipping GDP
The quest for growth and more dollar oriented growth is simply short-sighted.
The index for national prosperity, GDP, based solely on economic indicators should be replaced by a Genuine Progress Indicator (GPI) – also known as Doughnut Economics – based on three values of social, environmental and economic.
It is shortsighted and ignorant that the quality of life should be based on sales of automobiles, television sets, washing machines and other material goods – in other words, figures on human consumerism and consumption.
As such, GDP fails to reveal anything significant about the quality of life and the happiness rating for the country’s people. One of the paradoxes of society is that while the economic standard of living and rampant technology has increased, the country’s environmental standards and the health/happiness of society have declined alarmingly.
Where does the outdoors come into this?
Once New Zealanders were a land conscious, outdoor people with high physical and mental health and largely had satisfaction and contentment. Ironically today we are better housed and better entertained, better nourished but are less prepared to inherit the land or carry on the pursuit of happiness.
In the current government’s term, the single focus on GDP results in an obsession with growing exports. Autocratic politicians such as ministers Shane Jones and Chris Bishop mastermind and ram through law such as the Fast Track Approval Bill which is designed to speed up exploitation of natural resources while ignoring the people’s opinion. Shane Jones with his myopic vision wants to promote exports via commercial fishing and fish farming while ignoring fish stocks and the people’s recreational fishing.
Currently the deepwater orange roughy fishery has collapsed again, while crayfish fisheries have been closed and the kahawai fishery has collapsed under the onslaught based on the mindless quest for exports.
The expansion of largely corporate dairying has resulted in irrigation demands on rivers and excessive nitrate levels toxic to not only fish such as trout and salmon but cancer-inducing to humans in drinking water. Currently exploitation by mining corporates has erupted into controversy.
Under the GDP sole focus and the accompanying drive for more exports and more exploitation, the environment has increasingly undergone development and degradation in a futile bid to earn more export dollars while on the flip side, spending on imports balloons under ceaseless consumerism.
Continuous domestic population growth, accelerated by incoming migrants, has increased the demand for more housing causing cancerous urban sprawl over valuable productive farmland.
Politicians seek the solution by a drive for export growth, while ignoring the importation Wildlife species are threatened by chemicals and toxins with an increasing number of species labelled as “threatened” or “endangered.” Rivers are being dewatered by irrigation demands and from monocultures of pine forests. River water quality is contaminated with nitrates from intensive corporate dairying in low rainfall areas.
On paper, there should be hope that the Green Party would stand up for the environment of the people. Sadly the Green Party has become obsessed and deviated onto a social engineering platform.
Sluggish Response
The Council of Outdoor Recreation Associations of New Zealand (CORANZ) produced an election charter over several elections. The charter was sent to all political parties and MPs prior to each election inviting all to respond.
The charter listed within its key points to replace GDP with GPI – “Genuine Progress Indicator” where it’s not just economic goals but social and environmental.
The response was woeful. The two main parties National and Labour had to be phoned more than once, after closing date, urging them to submit their response to the key items, in order to be rated.
Only three MPs individually bothered to reply.
Yet MPs are keen to promise the earth before elections.
Well-being?
The Ardern-led Labour government in 2021 showed promise with a label on that year’s budget as a “well being” one.
“The Wellbeing Budget is designed to use social and environmental indicators, along with economic and fiscal ones, to guide the Government’s investment and funding decisions, “ the pre-budget hype promised.
Sadly, it was just political rhetoric and failed to deliver. Bull dung.
It is not surprising that New Zealand’s society has deteriorated. Technological developments are amazing and bewildering but not always for the common good. At the same time New Zealanders are falling prey to the weakness of an indoor nation and the flabby obesity of a sedentary society.
Is this a proud legacy to hand to future generations?
Editor’s note: It is election year and CORANZ urges all anglers, hunters and environmentally conscious New Zealanders to think deeply before election day November 7. More political articles will feature.
GDP (neo-liberal economics) is like a dog chasing its tail. Doomed to bankruptcy.
Then the scramble for exports sees natral resources plundered.
Why cannot Jones and Bishop and other MPs se the figures of trade deficits and sky rocketing debt?
The economic crisis becomes an environmental crisis because politicians see resource exploitation and exports as the solution.
Politicians are incapable – generally and mostly – of seeing beyond the three year election cycle. I am not advocating for a four year gap between elections. Heaven forbid!
But politicians whether it’s a three or four year term, cannot see beyond the election term.
The necessity is for politicians to recognise long term necessities such as the environment instead of short term monetary profits.