Trans-Tasman on Economic Future

October 2nd, 2009 at 9:52 am by David Farrar

Trans-Tasman has published a road map for improving New Zealand’s economic performance. They say:

No Government can ever get policy initiatives and responses 100% right. History shows too many imponderables from oil shocks to war, from disease to depression and simple lack of aspiration, to ensure perfection. They can only aim at good, not perfect, results.

What Governments are indeed sworn to is the search for profitable directions and good results, say well above the 50% and hopefully towards the 80% mark.

That’s a reasonable goal.

Observers are still surprised to think how, in the prosperous decade from 1999, the Clark/Cullen Government retreated from those goals. In seeking greater social justice, it chose to slice and dice the national cake.

I regard the 2000s as a missed opportunity of a generation. A massive period of economic growth and Dr Cullen spent it all.

So what does Trans-Tasman recommend?

  1. A Trans Tasman Single Economic Market – In Effect Economic Union – by 2015
  2. Energy as the Transformatory Base
  3. Greening NZ with Environmental and Industrial Forestry
  4. Innovation : Research, Science and Technology
  5. Ultra-Fast Broadband
  6. Securities Law Reform

Can’t see anything there I disagree with.

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26 Responses to “Trans-Tasman on Economic Future”

  1. KiwiGreg (3,128 comments) says:

    I’ll read it. But where is saving?

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  2. Gosman (335 comments) says:

    What the heck does “Energy as the Transformatory Base” actually mean?

    It certainly reads like some BS corporate speak nothing statement.

    Did they employ the same advisers as Obama to come up with that?

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  3. alex Masterley (1,437 comments) says:

    Looked at it. No complaints from this end.

    Lots of good stuff. Lets keep the ball rolling.

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  4. KiwiGreg (3,128 comments) says:

    Very disappointing. Proposal 1 we cant control as it requires the Aussies to want to join with us and what’s in it for them; proposal 2 is meaningless unless we have an industrial use for the energy. Proposal 3 is essentially – “let’s plant trees, that will make us richer”, clearly the authors have not looked at, for example, current NZD pulp prices. Proposal 4 appears on everybody’s list “the government should spend more on research”. 5 is already happening; I’m not convinced its a “silver bullet”. 6 is needed but unless NZers save its pretty meaningless.

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  5. getstaffed (9,188 comments) says:

    In seeking greater social justice, it chose to slice and dice the national cake.

    When did the Labour government seek greater social justice?

    Robbing Peter to pay Paul (in return for his vote) isn’t social justice. The entitlement syndrome that bourgeoned under Labour has taken debilitating welfare dependency to a new and frightening level.

    Their vilification of wealth (a la ‘rich pricks’) has helped focus a generation on envy rather than personal enterprise. It has fostered a “can’t do” attitude that is robbing NZers of their potential.

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  6. stephen (4,063 comments) says:

    KiwiGreg, to be fair 4 was bit more than what you said:

    The divided Research Science and Technology systems put in place in the 90s requires a review as full as the electricity sector has had. The often conflicting roles of the two lead agencies, MoRST and FoRST, the endless bickering between CRIs and universities on funding levels, the weak governance and funding of small research institutes, and the low rate of new patent registration in NZ all cry out for reform. One area of consistent complaint is the university sector, whose research is undoubtedly underfunded, but whose unchanging lobby for more funds and less scrutiny on outcomes has become a counter-productive cracked record.

    Was an article in the Herald(?) yesterday about how deregulating re: one or two Acts that were implemented in the 90s would help a lot more than ‘more funding’ would too, incidentally.

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  7. Brian Smaller (3,915 comments) says:

    Social Justice means Robbing Peter to pay Paul. It means income redistribution.

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  8. Elijah Lineberry (306 comments) says:

    Sounds like the usual wank-speak to me.

    They seem to have forgotten about tax cuts (mind you, so have the ACT and National parties), spending cuts for welfare, a focus on exporting and less on property investment.

    As David Farrar says, and I agree with him, the 2000′s have been a missed opportunity – a lost decade.

    http://www.nightcitytrader.blogspot.com

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  9. kaya (1,360 comments) says:

    The Clark/ Cullen era wasn’t a period of real economic growth. Like the rest of the west it was a credit based spendfest. It wasn’t based on anything sustainable.

    As for the report, noble aims. Simply put we need to improve and add value to what we do well. Agriculture, forestry, fisheries and tourism. In small scale manufacturing the emphasis needs to be on smarter, innovative products that people need rather than want. More r & d is essential, I firmly believe green technology is a key, particularly energy efficient building products and alternative energy generation.

    Micro generation, grid tied solar in particular has huge potential. Grid tied systems remove the need for batteries for storage which is the biggest drawback of solar energy. (Energy storage is the Achilles heel of one of our only sources of free energy.) Grid tied systems are actively encouraged and heavily subsidised in most OECD countries. (Australia gives $8000 towards systems, so do many states in the US and equivalent amounts throughout the EU and Japan).

    The concept is simple. A couple of solar panels on your roof running through a 2 way meter into the grid. When the sun shines you generate power and feed the grid, usually when most people are at work and when industry needs it most. What you generate is offset against your consumption, lower bill and a system that pays for itself in 12-14 years at current energy prices. System life is upwards of 25 years. Systems are ultra low maintenance, no moving parts as with wind turbines. A hose down once a month is about all it needs.

    It wouldn’t take a massive uptake of this to stop us needing to build more expensive infrastructure.

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  10. Simon Arnold (94 comments) says:

    Doing economic growth agendas for a country is always hard, and tend to border on the trivial when reduced to 8 pages. Back in 2003 I wrote a series for the NZ Chambers of Commerce entitled “Achieving Faster Growth For New Zealand” and even within 20 pages for the overview document and 5 supporting pieces of around 16 pages each it was difficult to get to the level of specificity that might have convinced a sceptical public.

    Just for the record I think the Chamber documents were among the first to introduce comparison with Australia as the rationale for doing something about growth. The approach I used was to say if we want 4% p.a. real growth then that would mean in a decade’s time (e.g. economy 50% larger than it was then).

    The themes I went for were Innovation; Trade; Auckland (and I like to think this was another first in getting this on the agenda); Workforce skills and size; and controlling growth in government spending to be lower than economic growth.

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  11. Johnboy (13,335 comments) says:

    “I regard the 2000s as a missed opportunity of a generation. A massive period of economic growth and Dr Cullen spent it all.”

    To be fair he did spend a lot on nurturing Trans-Tasman friendship, like the $700,000,000 to put a big grin on the faces of the shareholders of Toll. :)

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  12. davidp (3,319 comments) says:

    Kaya>It wouldn’t take a massive uptake of this to stop us needing to build more expensive infrastructure.

    Personal solar panels cost a fortune and return negligible amounts of power. Tim Blair has been highlighting stories about the subsidised Aussie scheme, usually where a person has spent several tens of thousands of bucks in order to generate a couple of hundreds bucks a year of electricity. It is a wealth destroyer, although the suckers who bought in to the schemes without doing their sums often think the problems could be solved with bigger subsidies.

    One example here, where a $28k “investment” in solar power earns a family about $50 a year…

    http://blogs.news.com.au/dailytelegraph/timblair/index.php/dailytelegraph/comments/thirteen_bucks/

    And remember: If it isn’t even slightly economical in Australia, where half the country is scorchingly hot, it certainly won’t be economical in damp cloudy NZ.

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  13. CharlieBrown (784 comments) says:

    Elijah Lineberry – I totally agree with you, its a whole lot of talk with no real direction. Though, I will point out that ACT havn’t forgot about tax cuts, its National (aka, New Labour) that have, ACT have been mute about them (probably a result of the support agreement).

    I know Roger Douglas has openly criticised National about their refusal to face the facts and make the changes (eg tax cuts, spending cuts, deregulation), however NZ is so anti Roger Douglas, most of NZ justs ignore him. Its kind of like the patient ignoring the doctors recomendations because they don’t like the doctor and the change that is required, even though it is necessary to survice. Or in even simpler terms, putting your head in the sand.

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  14. stephen (4,063 comments) says:

    …however NZ is so anti Roger Douglas, most of NZ justs ignore him.

    So when he’s gone, people will start voting ACT again?

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  15. CharlieBrown (784 comments) says:

    “So when he’s gone, people will start voting ACT again?” Thats a silly question, not many people voted for ACT when he wasn’t an MP.

    So, let me rephrase what I said. NZ doesn’t really ignore Roger Douglas, instead NZ just dismisses what he says as right wing extremism from another era. Even though thinking that is extremely stupid, naive and wrong.

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  16. stephen (4,063 comments) says:

    Yes well I was deliberately being a bit silly. I don’t think it’s the man, it’s the message. Some righties (lefties too of course) seem fixated on him – ‘he’s here, we should SO be using him!’, when there are plenty of ACT MPs capable of doing the same, surely.

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  17. BLiP (28 comments) says:

    A massive period of economic growth and Dr Cullen spent it all.

    Not according to Double-Dipton Bill English.

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  18. CharlieBrown (784 comments) says:

    Stephen, you are right, there are other ACT MPs, however I think he is the only one there that has the ability to speak out about this. You have 2 mps that are mainly focused on law and order, and I don’t think they are all that worried about other policies. You then have 2mps that are ministers and probably hamstrung with what they are allowed to say, so all that is left is Roger Douglas, who is providing the sole voice in speaking out against the Nats for not doing what is needed.

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  19. stephen (4,063 comments) says:

    You may be interested in Bryce’s post on ACT’s campaign last year Charlie:

    On Douglas:

    He had obviously learned from Richard Prebble and Rodney Hide that the ‘radical stuff has to go’ and that under the new professionalized environment, politicians were not supposed to say anything too bold.
    (no link as annoyingly http://liberation.org.nz/ doesn’t ‘do’ that for some reason, but it’s not far from top)

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  20. Repton (769 comments) says:

    If National succeed in getting rid of MMP, ACT will cease to exist anyway..

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  21. CharlieBrown (784 comments) says:

    Stephen, I totally agree with that. However I don’t believe Roger Douglas is being radical, he is challenging the status quo, and he is the only MP on the right doing that. The point I originally made was that someone in ACT is speaking out against the removal of tax cuts and the refusal to properly rein in Govt spending. For proof of this see the following article: http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10575030

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  22. bchapman (649 comments) says:

    These are all aims, but how do they intend implementing it. A bit like the current government lots of talk about regulatory and economic reform but when it comes to proposals errrrr no too hard.

    Ten months into a new government and about the only significant decision taken so far has been to repeal the tax cuts they were promoting as the panacea. They’ve actually cut R and D tax deductions from Labour and certainly haven’t been enthusiastic about alternative energy.

    Maybe the Brash commission will come up with some ideas- but I wouldn’t count on it.

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  23. Simon (611 comments) says:

    “I regard the 2000s as a missed opportunity of a generation. A massive period of economic growth and Dr Cullen spent it all.”

    Shrink the size of NZ govt and we will piss all over Aust. National aint up to it.

    Don’t blame those fuckers Cullen and Clark National aint gonna do anything different. Just stop lying.

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  24. jackp (668 comments) says:

    Blip, the article is half right. Labour also increased the price of government price tag by 45 billion with their social justices programs If this spineless national government reduced government, our standard of living would rise. Instead they gather a Tax Working Group to increase the government take. It is too bad kiwi’s have been conditioned to suck off their own governmental tits because New Zealand could be a great country. Kiwi’s in general are hard workers.

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  25. Michael E (274 comments) says:

    One of the problems is New Zealanders are a mobile lot – cutting the unnecesary spending will drive more Kiwis overseas. I think it’s a huge shame that Clark and Cullen didn’t follow a more orthodox view with the surpluses they received with investment in infrastructure, tax cuts, and investment in turning out more skilled workers.

    Instead they spent on vote winners like having interest free student loans regardless of the course – reducing the cost to students of medical, science and technical education would have given much more bang for the buck there – and making WFF available to families with high enough incomes to be on the top tax rate – even if they have only one or two children.

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  26. kaya (1,360 comments) says:

    davidp – I just read your response to my earlier post, you need to do your own research and not refer to the dribbling of an Australian blogger who is talking out of his arse. Let me address your points, you say:

    “Personal solar panels cost a fortune and return negligible amounts of power. Tim Blair has been highlighting stories about the subsidised Aussie scheme, usually where a person has spent several tens of thousands of bucks in order to generate a couple of hundreds bucks a year of electricity. It is a wealth destroyer, although the suckers who bought in to the schemes without doing their sums often think the problems could be solved with bigger subsidies.

    One example here, where a $28k “investment” in solar power earns a family about $50 a year…

    http://blogs.news.com.au/dailytelegraph/timblair/index.php/dailytelegraph/comments/thirteen_bucks/

    What an obfuscating asshole Tim Blair is. He implies the people involved only received about $13 in return for their investment. He is only refering to the EXCESS power produced and doesn’t even mention the power they used in the running of the house! Talk about distorting the facts, he makes Helen Clark look like a straight shooter.

    Apart from anything else, calculating the cost of generation is done by comparing the cost of systems set up side by side in an equal environment. The figures are bollocks.
    In the case of traditional large scale generation it is calculated as the price once out the “fatory door”. It does not factor in the cost of all the reports, consultants, architects, policy advisers, designers, land purchase, consultants, iwi placating, taniwha placating, construction costs, policy advisers, consultants, resource consent costs, local council costs, consultants, maintenance costs etc etc ad nauseum. (Did I mention consultants and policy advisers?) Try adding that to the cost of your energy production.
    The majority of these costs are not (or should not be) required in GTMG (grid tied micro generation) systems.

    Based on your post above you are saying that the Australian Govenrment have been duped into wasting money on incentives that are basically useless. Really?

    You say:

    “If it isn’t even slightly economical in Australia, where half the country is scorchingly hot, it certainly won’t be economical in damp cloudy NZ.”

    What about sunny Scotland?

    http://www.energysavingtrust.org.uk/schri/household/grant.cfm

    Canada

    http://fit.powerauthority.on.ca/

    USA

    http://www.dsireusa.org/

    Australia

    http://www.heat.net.au/subsidies-rebates.html (see para 2 Photovoltaic Rebate Program)

    Is the blogger you refer to suggesting that all of these countries are really stupid and throwing their money away? Are you saying that he knows better than 17 EU countries, the USA, Canada and Japan?

    Apparently New Zealand agrees with him because we have decided to go with large scale wind generation. I personally believe that is more about being able to clip the ticket than doing the right thing, can’t have the massescreating their own energ now, can we? It’s a subject I have written to Gerry Brownlee about many times, never a reply. EECA have been more forthcoming and are finally starting to investigate it but it’s like watching non drying paint dry.

    One of the more compelling pieces of information is this document showing what can be achieved by positive action. From Germany. Their legislation has been in place for 14 years………

    http://www.wind-works.org/FeedLaws/Germany/Stryi-Hipp_Experience_with_EEG.pdf

    It is astounding to imagine that all these countries are on the wrong track. As friends and allies of ours shouldn’t we be letting them know?

    Seriously davidp, if you are going to quote someone you should go and check out what they are saying rather than taking it as gospel, there is a lot of bullshit on the internet.

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