Trotter on Labour’s enrol for the dole

May 15th, 2015 at 12:00 pm by David Farrar

Chris Trotter writes:

The other explanation for Labour’s curious submission is considerably less lofty.

Despite enormous effort by scores of tireless volunteers, tens of thousands of likely Labour voters failed to enrol in time for last year’s election. Though technically in breach of the Electoral Act, these citizens will probably not be prosecuted. Receiving no disincentive to repeating the offence, there’s every chance their names will not appear on the roll again in 2017.

If, however, tens of thousands of social welfare beneficiaries – people who, most experts agree, are much more inclined to vote for political parties of the Left than the Right – were required (ably assisted by Work and Income staff) to fulfil their legal obligations as electors before receiving their benefits, then the Labour Party would be saved a huge amount of hard political slog.

First make it no benefit if they don’t enrol. Then no benefit if they don’t vote. And finally an increased benefit if they vote Labour!

When viewed from this perspective, Labour’s submission not only appears organisationally self-serving, but it could also be construed as a subtle thrust against the emerging strategic preference (among Andrew Little’s principal advisers) for Labour’s effort to be directed at “soft” National Party voters. Many on the left of the Labour Party are convinced that the tens of thousands of unregistered voters constitute a more wholesome electoral target than some 21st century version of “Rob’s Mob”.

That Labour’s submission ended up attracting so much (presumably unwanted) media attention more than bears out the observation with which this discussion began. That one of the best ways of telling whether or not things are going well for a political party is how invisible its organisational wing is willing to become, and how anonymous its leadership.

The question for the Labour caucus should be why did none of the three Labour caucus reps on the NZ Council vote against the submission or stop it?

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Labour’s blog obsession

May 15th, 2015 at 7:00 am by David Farrar

TransTasman reports:

A Labour MP was expressing his horror recently to a press gallery journalist. Nothing new in this, of course – opposition MPs, at any time and in any party, need to have a cache of faux outrage ready to uncork at all times. But this outrage was real. How disgusting it was, he said, the gallery had given blogger and National’s pollster David Farrar accreditation. Sorry, what? The gallery journalist’s head whirled a moment…. and then it cleared. Six weeks ago, Farrar had a post on his blog claiming he now has press gallery accreditation. The story ran on April 1.

A chocolate fish to the journalist who lets me know the name of the Labour MP who not only fell for the April Fool’s Joke, but also was still obsessed by it weeks later.

This would just be an embarrassing little item, if it weren’t for the wider context. Opposition activist, and Labour folk in particular, have a growing obsession with what people like Farrar and his tribal compadre, Matthew Hooton, say about them.

Sometime Labour staffer and researcher Rob Salmond recently wrote the Northland by-election was effectively a win for Labour because Andrew Little chose not to compete, and when teased about it by Hooton he, and DimPost blogger Danyl McLauchlin, expressed worries if Little had done, and had inevitably failed to win the seat, people like Farrar and Hooton would have mocked him. As if anything else Little did would have stopped such mocking. It is a revealing sign of how low morale and selfbelief is amongst the country’s left wing activists when what Farrar and Hooton say looms so large.

Let’s do a comparison. Does a single National MP or activist spend a second worried about what people on The Standard says?

The reason why not, is because The Standard exists solely to attack National. Kiwiblog does not exist solely to attack. Sure I agree with the Government 80% of the time, but I regularly blog areas I disagree with them on, and will praise policies and statements from opposition parties I agree with.

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Labour looks at going back to huge unfunded liabilities for ACC

May 14th, 2015 at 7:00 am by David Farrar

Fran O’Sullivan reports:

Labour says it would consider widespread changes and might look at a “pay as you go” scheme rather than fully funding ACC in the future – should it become Government.

This would be a huge reckless step backwards. It was actually Labour that started to implement full funding, and very sad to see them backtrack on it.

If you go back to non fully funded levies, then you end up with ever increasing unfunded liabilities. Even worse the Government can make eligibility decisions that will have a huge impact in the long-term, but will escape scrutiny if levies are on a pay as you go basis. It allows Labour to massively increase costs, with the bills being left for future levy payers.

Once again we see Labour moving to the left of the Helen Clark Government. They have learnt nothing.

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Is Barnett being set up as the fall guy?

May 13th, 2015 at 1:00 pm by David Farrar

Richard Harman reports at Politik:

Labour’s Caucus will next week discuss the proposal by the party’s General Secretary, Tim Barnett to deny Working for Families tax credits to people who don’t enrol on the electoral roll.

The proposal was made to Parliament’s Justice Committee’s Review of the Election.

It appears to have caught the Parliamentary wing of the party by surprise and has angered some.

A spokesperson for Leader Andrew Little said the first he heard about it was in the media. …

The submission itself claims that it was “lodged on the authority of the New Zealand Council, the governing body of the Labour Party.”

I may be wrong, but I think it is highly highly likely that the submission would have been circulated to the NZ Council in advance. It certainly would be inappropriate for a submission from a political party not to have been approved or circulated to the rulong body.

I am almost certain Barnett would have had the submission circulated to the NZ Council. The NZ Council includes three MPs – Andrew Little, the caucus secretary and a further caucus rep. So if so, the question should be why didn’t Andrew Little read his NZ Council papers? At a minimum, his staff should be reading these, and highlighting any papers which might be politically sensitive – such as a submission proposing cutting off welfare benefits to those not on the electoral roll.

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The rise of the ‘shy Tory': why pollsters are missing voters on the right

May 12th, 2015 at 3:57 pm by kiwi in america

At 10pm British Daylight Time on May 7th, seconds after the polls closed, the various media outlets covering the UK General Election unveiled the results of the giant exit poll commission by a consortium of British polling companies. Anyone who watched this coverage will never forget the barely suppressed shock that the Conservatives were estimated to win 316 seats some 25 seats more than the most optimistic opinion polls published days before the ballot.  Lord Ashdown (a former Liberal Democrat MP and leader in the Commons) expressed such disbelief at the veracity of the exit poll that he said if he was wrong, he’d eat his hat! Ashdown’s disbelief in the exit poll’s numbers was vindicated but not the way he’d hoped because it too underestimated the scale of the Tories’ success. Cameron was to retain the premiership with an absolute majority and 331 seats actually increasing the Conservatives’ percentage of the vote – a result dramatically different than the one anticipated by virtually all observers of the campaign.

The English media have been awash with hand wringing analyses as to why the polls were so wrong and why Labour lost so badly. Almost all pre-election commentary revolved around likely coalition negotiations with many pundits picking a Labour/SNP/Green coalition. Milliband, on the strength of some one-eyed reports from polling stations, reportedly told his front bench late in the day to be humble in victory when interviewed by the media so convinced was he, despite the predicted Scottish SNP landslide, that Nicola Sturgeon would join him in the governing coalition.

The failure of the mainstream pollsters to pick this win (only an 18,000 strong on-line Spider Monkey survey had picked the eventual 37/31 Conservative/Labour split) has been put down to the behaviour of the  so-called ‘shy Tory’. This term was first coined by John Heyward (now a Conservative MP) when he was John Major’s pollster in the 1992 election to explain why pre-election polls pointing to a Kinnock led Labour victory were wrong. Essentially Tory leaning voters lied to the pollsters.

In recent years, this underestimating of actual voter turnout of centre-right parties by reputable polling companies has become a recent global phenomenon. On top of the UK Election of May 2015 we can add similar polling failures in the:

  • Israel Election March 2015 (Likud got 29 seats versus a predicted 19 enabling Netanyahu to form another Likud-led coalition)
  • US mid-term elections November 2014 (most polls underestimated the size of the GOP gains in the Senate, House, Governor’s Mansions and state legislative races)
  • Scottish Referendum September 2014 (the ‘No’ vote got 55% versus the last polls predicting a narrow ‘Yes’ win)
  • NZ Election September 2014 (almost all polls pointed to NZ First holding the balance of power whereas the Key led Nats managed an election night absolute majority. Even though this was clawed back by special votes and the Northland by-election, Key, like Cameron, managed to increase National’s share of the vote from the previous election)
  • EU Elections May 2014 (polls missed the sizable swing to UKIP in the UK portion of the EU Parliament Elections)

David gave some reasons for these polling failures in his post

Some of the reasons why Tories (or supporters of right leaning parties) have become so shy with indicating their voting intentions to pollsters are:

The Left’s vitriol means conservatives are more likely to stay mum
The left believe they have the moral high ground and to oppose their policies is at best bad and inhumane and at worst, downright evil. More on the left see politics and legislative action as the most important force for good in the world – the power of the state to ensure good outcomes as they see it. More on the right see the state as far from a benign force for good and derive satisfaction outside of politics from family activity, humanitarian efforts in the community and organized religious involvements. This moral superiority the left feel they have infuses their political debating with self-righteous indignation sometimes propelling them to more nasty and personal attacks on their opponents. Opponents are more likely to be labeled with extreme epithets to discount and shut down their views (e.g. homophobe, racist, heartless, greedy, uncaring).

Many on the right quickly tire of these abusive ad hominem attacks. When you add that the left has a core of activists who are driven to the political theatre almost 24/7 and for whom warfare with the right is an article of faith and a rite of passage, it makes for a palpable ‘take no prisoners’ approach to debating their opponents. Ordinary right leaning voters who engage on social media on the issues of the day in the run up to elections are routinely subjected to vitriolic attacks often in an almost coordinated way from a myriad of well-armed and argumentative left leaning activists such that they withdraw from the battlefield and learn to keep their opinions to themselves. Fearing further opprobrium for supporting a right leaning party when asked by a pollster, voters from the right often will either lie as to their party leaning or that they are undecided when they are already a committed Tory voter. The left’s aggressive approach to political debate is one of the biggest reasons for shy Tories.

Labour in the UK claimed to have won the Twitter campaign and the social media battle but ended up losing the war that counts – the actual election not realising that the Twittersphere is not the same as swing voter land. The young are disproportionately represented on Twitter and social media debates and they are more likely to tilt left and be vocal about it BUT less likely to vote. The left have rendered open discussion in favour of a number of contentious issues such as immigration reform or against gay marriage and Islamic extremism as not appropriate opinions for citizens to hold in a modern progressive society. They have effectively driven a significant minority of the electorate out of the public square and off the debating stage. The left’s bullying has a number of perverse effects on approved speech thus silencing public dissent. These attempts don’t sway voter opinion in their favour but merely strengthen the resolve of the un-listened-to voters to get out and vote for the leaders and parties the left so despise.

The notion of what is appropriate discourse even effects the pollsters. One admitted to deciding not to poll on contentious issues of concern to right leaning voters like on excessive Muslim immigration or welfare reform for fear of the public backlash from the vocal left.

Elite opinion makers have become more disconnected from median voters
The chattering classes overwhelmingly tilt to the left. Even right leaning public commentators often hold more socially liberal views than floating voters and can be more sensitive to elite opinion when it turns on them for their more conservative views. Because the commentariat tend to mostly talk to each other, they become cut off from median voter opinion which is more right leaning and conservative. They are then shocked when majority opinion votes the opposite to them. This disconnect is manifest in a number of ways:

* Rise of militant Islam is ignored by the chattering classes but is of more concern to centrist swing voters but is a topic rarely canvassed in media panel discussions or debates for fear of offending Muslims. This sort of political correctness reached absurdity when Milliband proposed to ban Islamophobia. Where are moderate centrist voters to turn if their reasonable concerns are blatantly ignored by a major opposition party seeking power? The rise of UKIP saw the Conservatives trying to engage more on these contentious issues and thus were seen to be more likely to respond to voter concerns.

* Beltway types look past the deficiencies of the left’s standard bearer in their desperate quest to get their man across the line. Milliband was a nerdy policy wonk who came across as awkward and goofy, who decried business, refused to disavow the profligate spending of the Labour government he was a minister in and banked on dissatisfaction with the austerity measures to propel centrist voters to his more leftist vision for Britain in much the same way a more left leaning Cunliffe hoped NZ Labour would get out the so-called missing million.

* Euroscepticism is a subject that brings out the most dismissive and arrogant tut tutting from elites who have frequently disdained the rise of UKIP and the popularity of Nigel Farrage in his call for an EU referendum. Cameron successfully neutralised the electoral fallout for the Conservatives from UKIP by promising the In/Out referendum. Shy Tories who favour Brexit again felt shouted at and ignored by beltway commentators and Labour.

New media allows those on the right to break the MSM’s monopoly on reporting
Whilst Britain has sported an ideologically varied print media for some decades now, the commentariat on TV, radio, the political scientist and the political reporting class reliably tilt to the left. The internet has shattered that monopoly and, along with You Tube and other user driven broadcast sites, enabled the growth of right wing blogs and right wing on line magazines and newspapers. This has enabled shy Tories to read more about politics from a perspective they understand and sympathise with. It reinforces their suspicion of the commenting class and of the mainstream media and journalists and adds to their shyness with pollsters.

Other factors that helped Cameron: Voter preference for stability
Incumbency often provides some advantage to the ruling party. In the UK, voters less familiar with coalition government even after five years of the Lib Dems deal with the Tories, were genuinely spooked by what the polls were pointing to – a Labour Party that would get fewer seats than the Conservatives but be able to govern with the help of the resurgent Scottish National Party. Not only would the harder left SNP tail wag Labour’s dog, the very state of the United Kingdom would be at stake a mere six months after the Scottish voted reasonably decisively to stay with England. However ambivalent voters may have felt about Cameron, they saw a Conservative led government as more stable and more likely to fight for the union.

“It’s the economy stupid”
The left made much of the Tory’s austerity programme fuelled by media stories of those effected. Middle class Brits with jobs saw an improving job market, falling unemployment, rising incomes and property values as helping their own personal financial stability and, like their Kiwi counterparts in 2014, voted for a continuation of the government that was perceived to be fiscally sounder and whose fiscal rectitude through tough times saw better economic times return. Like Cunliffe’s ‘true red Labour’ shift, Milliband was seen as appealing more to the Hampstead Fabian Society by attacking big business and seeking a return to the spendthrift days of other more left leaning Labour governments than the more successful centrist approach adopted by Blair to New Labour’s electoral advantage.

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Herald on Labour’s no enrol no welfare proposal

May 12th, 2015 at 3:00 pm by David Farrar

The NZ Herald editorial:

The Labour Party has floated the idea of withholding state support such as Working for Families tax credits from people who are not enrolled to vote. Its general secretary, Tim Barnett, has told a parliamentary select committee this would tackle “pretty compelling evidence that there is a continuing pattern of people not enrolling”. To that most hollow of nuts he would take a sledgehammer. Labour is normally the last party to advocate withholding benefits for any purpose, let alone an electoral one. …

Labour has often railed against plans to make state support conditional on compliance with other social programmes, such as requiring beneficiaries to take pre-employment drug tests or threatening to cut benefits if parents do not have children in early childhood education. Yet those sort of conditions address real and obvious problems. To use benefits as leverage for electoral enrolment is more like tilting at windmills.

So it is wrong to require beneficiaries to be available for work and have their kids in ECE, but it is a good idea to cut off their benefits if they don’t enrol, because the most important thing in society is that beneficiaries are enrolled, so they can vote Labour.

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The global failures of the left this decade

May 11th, 2015 at 11:00 am by David Farrar

It may be coincidence, but in almost all the countries we take a big interest in, the centre-right has been winning election after election. Let’s look at each of them:

  • Canada – Stephen Harper won in 2006, 2008 and 2011 – increasing his seats each time to go from minority to majority
  • New Zealand – John Key won in 2008, 2011 and 2014 – increasing his seats each time
  • UK – David Cameron won in 2010 and 2015, increasing his seats to go from minority to majority
  • Australia – Tony Abbott won in 2010
  • Germany – Angela Merkel won in 2005, 2009 and 2013 – increasing her seats each time to go from minority to majority
  • US – in 2014 Republicans got largest majority in House since 1929, the largest mid-term Senate gain since 1958, now hold 31 of the 50 Governorships and the highest number of state legislatures since 1928. The Democrats last held so few state legislatures in 1860. Only the presidency remains for them.
  • Israel – Bibi Netanyahu won in 2009, 2013 and 2015, increasing his majority in 2015
  • France – lost the presidency in 2012, but highly likely to regain in 2017 with polls showing Hollande in third place.

What is interesting isn’t just that so many countries have centre-right governments, but that in Canada, NZ, the UK, and Germany the incumbent Governments have increased their seats. It used to be the case that governments lose seats and oppositions win them. but no longer.

An interesting observation I saw about the UK election is that the last time Labour won an election in the UK without Tony Blair was in 1974 – 41 years ago. The importance of this observation is not about who was leader, but how he positioned the party. Blair won as “New Labour” and he moved Labour towards the centre. Miliband moved it to the left and made income inequality the focus of his campaign, and lost.

Likewise in NZ Labour, since they lost office, have moved to the left of Helen Clark. Goff,  Shearer and Cunliffe all advocated old left policies – many of which were rejected by Helen Clark when she was PM. Will Little continue with the shift to the left, or try to compete in the centre?


Labour promotes enrol for the dole!

May 9th, 2015 at 11:00 am by David Farrar

Labour is against work for the dole, but they are promoting enrol for the dole!

The Herald reports:

Labour has proposed withholding state support such as tax credits and Working For Families from people who are not enrolled to vote.

The measure could be justified if it lifts New Zealand’s low voter turnout, the party says.


So no welfare payments if you don’t enrol.

Labour has strongly criticised National for linking state support to obligations, including requiring beneficiaries to take pre-employment drug tests, and potentially cutting benefits if parents do not have children in early childhood education.

You don’t need to work for the dole but you do need to enrol they’re saying!

Low voter turnout tends to hurt the left more. In 2011, about 39,000 people were on the electoral roll in Mangere, whose voters favour Labour, compared to 48,000 in National stronghold Epsom.

That difference is not just about enrolment rates. Electorates have roughly the same number of people, but not the same number of adults. Mangere is an area with many more children than Epson, so hence they have less adults living there eligible to enrol.


Trotter on metropolitan elites

May 5th, 2015 at 9:14 am by David Farrar

Chris Trotter writes:

Whether the United Kingdom has a Labour Prime Minister by the end of this week remains to be seen. What cannot be disputed, however, is that among Labour’s traditional working-class constituency, much of the Conservative/Liberal Democrat Government’s programme remains surprisingly popular.

Four out of five trade union members, for example, told pollsters that they thought the £26,000 (NZ$52,300) cap on benefits was a good idea. Indeed, Matt Ridley, Member of the House of Lords and author of the bestselling book, The Rational Optimist: How Prosperity Evolves, reports that “Tory candidates out canvassing tell me they are finding that welfare reform, while horrifying the metropolitan elite, is most popular in the meanest streets — where people are well aware of neighbours who play the system”.

This is the same in NZ. The 2011 NZ Electoral Study found (on a weighted average basis) support for the following:

  • Unemployed should work for benefits 80%
  • Benefits make people lazy and dependent 63%
  • Most unemployed could find a job if they want 60%
  • Most on dole are fiddling 59%
  • Trade unions are too powerful 52%

And take work for the dole. Among those who voted Labour in 2011, 76% support work for the dole, and only 14% are against it. For Green voters it is 73% in favour and 16% against.

49% of Labour voters agreed most unemployed could find a job if they want, with 42% disagreeing.

47% of Labour voters agreed benefits make people lazy and dependent with 39% disagreeing. With Greens 46% agreeing and 38% disagreeing.

The problem for NZ Labour is the disconnect between the MPs and activists, and their voters, and potential voters.

What horrifies “metropolitan elites” has, however, come to dominate the policies of both the British and New Zealand Labour Parties. Highly educated and socially liberal, the party activists of both countries would rather see their parties split in two than endorse the “reactionary” views of their working-class supporters.

Long may it continue. Labour for the last two elections has campaigned on paying the in work tax credit to families not in work. And they wonder why they don’t get 30%!

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Will Labour try and bring back death taxes?

April 30th, 2015 at 4:00 pm by David Farrar

Richard Harman at Politik writes:

Labour is looking for a replacement for its capital gains tax.

And one influential former advisor is advocating a wealth tax, particularly the return of death duties.

Yes, because people should be taxed for dying.

However Finance Spokesman, Grant Robertson, while he says the party is looking at taxing wealth thought estate duties would be unlikely.

They fought abolishing them, so why wouldn’t they bring them back?

But scrapping the Capital Gains Tax proposal leaves a big hole in Labours fiscal projections.

The party forecast that the tax would bring in $25 million in its first year rapidly rising to over $1 billion a year after six years.

Labour either will have to restrict their spending promises to what the current tax take can afford, or they will have policies to increase taxes and impose new taxes to fund their promises. Sadly I doubt it will be the former, so we wait to see whether or not they will opt for death taxes.

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Cullen on Labour

April 14th, 2015 at 9:00 am by David Farrar

Rob Salmond blogged a speech Michael Cullen recently gave about what Labour needs to do, to defeat John Key.

Interesting that an SOE Chair is giving a speech about how to defeat the Government. I suspect that if this had hapened under the Clark Government, the Chair would have been sacked the next day. But regardless of the propriety of it, it is an insightful analysis. Some extracts:

By the time of the fall of Ruth Richardson, after the 1993 election, centre left pragmatists had regained control of the Labour Party. Centre right pragmatists soon largely regained control of the National Party except, perhaps, for the strange interregnum of Don Brash (though he had to pretend not to be a neo-liberal while leader). Since then, in New Zealand, “neo-liberal” has degenerated into a somewhat meaningless term of abuse applied by too many on the Left to anyone on the Right.

Thank you Dr Cullen. Indeed it is. That is why Eleanor Catton is not taken seriously when she rails on about the neo-liberal NZ.

In fact the current government is far from neo-liberal – it might more accurately be seen as pragmatically populist centre right.

Not entirely inaccurate. It is not centre-left as some commenters here fervently believe, but neither it is anywhere near neo-liberal.

We need to begin by recognising some central facts relating to MMP. The first is that under MMP, working too closely in harness with another party, whether it be the Greens or any other, does not maximize the overall progressive vote but potentially reduces it. Ironically, such a strategy is more suited to a first past the post or preferential voting system.

Labour working closely with the Greens helps the Greens, but not the left.

The second is that while the Greens are, at this stage, our natural primary partner, with whom we share many broad values,their vote at elections is stuck around 10%. That will only grow if it comes off us. And while New Zealand First may seem an alternative, it is scarcely a credible long term option and has some very different positions on key issues from Labour.

Thus to form a strong, stable progressive government Labour still needs to aim to get around 40% of the vote. The missing 15% is not going to come primarily from non-voting socialist fundamentalists as some in recent times seemed to believe. We certainly need to motivate as much of the non-vote as we can to vote for us. But the bulk of the increase has got to come from recapturing votes from National, as they did from us in 2008.

And that means policies not competing with the Greens on the extreme left.

Attracting these middle ground swinging voters is our job, whether some of us like it or not. The Greens know that is our job, rely on us to do it, but can afford the luxury of criticising us for doing it.

I know that some in the Party see this almost as a form of treason. My answer to that is that it is treason to all our history as a party to promote political impotence in the pursuit of political chastity.

I wonder if Michael ever reads The Standard.

The four concepts which I believe we have to persuade people are ones where they feel we identify with them are choice, aspiration, responsibility, and national pride. If you think at this point I’ve gone totally doolally then my reply would be that allowing our opponents to dominate with regard to these concepts is akin to giving them a ten mile start in a marathon.

The trouble for Labour is that many people think Labour is anti-choice, anti-aspiration, doesn’t believe in consequences for bad decisions and sees national pride as racism.

If Labour can associate themselves with those concepts, they’ll get over 40%. But I doubt they can.

Let me give you an example from my role as Chairman of New Zealand Post. The exercise of choice by the majority threatens to limit the choices of some. As people abandon traditional mail, stop buying stamps, and do their banking on the internet so we are being forced to look at how we adjust our service offering in response to shrinking revenue but rising costs. The answer is not to maintain an expensive network which is increasingly drastically underused but to provide facilities and assistance to those still excluded from the new technologies so that they can also benefit.

Can we apply the same logic to Kiwirail? Stop maintaining an expensive network?

In other words, choice in a social democratic context is not enhanced by engaging in a hopeless, self-defeating, and politically suicidal attempt to level down by constraining choice.

Clap, clap.

A broad range of policies can then ensure that much of that growth improves the standard of living of those on low to middle incomes. These include such obvious candidates as regular above average increases in the minimum wage, intervening on the supply side in the housing market, boosting primary health care and lowering its cost, and so on.

I would point out National has boosted the minimum wage in real terms, has intervened on the supply side in housing, and has boosted primary health care. As Cullen says, this is not a neo-liberal government.

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What did the Labour/Greens power policy cost the taxpayer?

April 9th, 2015 at 12:00 pm by David Farrar

Mark Lister writes in the Herald:

Since listing at $1, Meridian shares have more than doubled, providing investors with a return of more than 100 per cent in less than 18 months. If dividends are included, this return jumps to 125 per cent over the period.

Utility companies such as Meridian are supposed to be predictable companies that offer steady (yet modest) returns. They aren’t supposed to double in price within barely a year the way a high-growth technology share might.

Part of this can be explained by a fall in interest rates over the period, which has made high-yielding shares more attractive and seen investor demand push up share prices.

But with the benefit of hindsight, another key reason for such a strong performance is that they were probably sold a little too cheaply in the first place.

In my opinion, the blame for that rests firmly with the Opposition political parties of the time, Labour and the Greens.

The “NZ Power” reform policy they championed through 2013 and early last year was heavy on emotive rhetoric, and short on detail. Whenever the proponents were quizzed about how it would work or be implemented, there didn’t appear to be many clear answers.

Labour and the Greens seemed to give up on this policy after the last electricity IPO was completed, and it didn’t get nearly as much airtime after that. That adds weight to the view that it was dreamed up only to derail the IPO process.

It was an act of commercial sabotage. They announced it just days before the first sale. It successfully reduced the price people were willing to pay for shares, which meant that the taxpayer lost perhaps a billion dollars due to this policy of sabotage from Labour and Greens.

In that respect, it failed. All it succeeded in doing was creating political and regulatory uncertainty among investors, and reducing the price the New Zealand taxpayer was paid for the 49 per cent of the assets now owned by private investors and managed funds.

The Crown received $1.8 billion (including the 50c a share due shortly) for the 49 per cent of Meridian sold, and that stake is today worth over $3.2 billion. The 49 per cent of Genesis sold down a few months later for $760 million is now worth almost $1.2 billion.

Had it not been for the uncertainty that was created at the time by the Opposition, the IPO sale prices could have been quite a bit higher.

In hindsight, it seems Labour and the Greens might have almost single-handedly contributed to a significant transfer of wealth from the average New Zealander (as the seller) to a much smaller group of people – those who could afford to buy shares in the IPOs.

As someone who invested in all three floats, their policy has made me a five figure capital gain. Thanks Labour and Greens.

While those who bought these shares will be celebrating some excellent returns from investments that should have been relatively boring, maybe the rest of the country is due a belated apology from Labour and the Greens for doing them this disservice.

If Labour and Greens can cost taxpayers one to two billion dollars in opposition, think what they might cost in Government!

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Why Labour is in crisis throughout the Anglosphere

March 26th, 2015 at 10:00 am by David Farrar

The New Statesman reports:

It is easy to blame Ed Miliband for Labour’s problems; too easy. Labour parties are in crisis all throughout the Anglosphere: they are in opposition in Australia, Canada, New Zealand and the UK. Their problems go far deeper than the identities of their party leaders.

Labour’s fate seems especially bleak in New Zealand. Here the centre-right National Party reign: Labour won just 32 out of 121 seats in the general election last year, and only 25 per cent of the vote. Nowhere is Labour’s battle for relevance more urgent.

25% is a low in any of these countries.  In the UK they are at 33% (same as Conservatives), in Australia 38% (2% behind Coalition but 4% ahead on TPP), in Canada the Liberals are at 34% (1% ahead). In NZ they got 22% less than National.

Little is determined to learn from these mistakes. It might be that as a former trade union official, he will find it easier to reorientate Labour to a position from which it can again win elections. “The language the commentators keep using is ‘moving to the centre, moving to the centre’. And I think it is about getting down to a small number of priority issues,” he says. Last year, one of Labour’s problems was drowning the electorate in policy detail. “What I’m determined is that for the 2017 election, we won’t do what we did last time, which was have 120-odd policies,” Little says. Instead the party will offer a pledge card highlighting five or six main policies, much like Tony Blair’s Labour Party in 1997.

He sees rehabilitation for Labour lying in “finding a language and ideas that resonate with people that say, actually, there is a different way of doing this.” Labour parties must be seen as modern and forward thinking, and not merely lamenting the changing nature of the international economy that has eradicated the notion of a job for life. “That is where the future lies – being able to talk about the future of work.”

The rhetoric is good and pleasing to see Little saying this. But can he deliver a policy prescription that recognises it? To the contrary their labour policies seem to all be about reducing flexibility, not increasing it.


Labour abandons 20 years of support for free trade

March 26th, 2015 at 7:00 am by David Farrar

NewstalkZB reports:

Labour is set to initially back a New Zealand First Bill that would legislate against a potential crucial clause in the Trans Pacific Partnership free trade deal.

Fletcher Tabuteau’s Bill would negate the ability of foreign companies to sue Governments over law changes that harm their business.

Labour Leader Andrew Little says they will support the legislation at its first reading as they have concerns about investor state dispute proceedings.

This is a massive shift in policy for Labour, putting them firmly on the extreme left. They have a proud legacy of supporting trade agreements but they are saying they will vote for a bill which would basically guarantee NZ would never ever get to sign another free trade agreement.

This is not just about the proposed TPP. Investor state clauses are now very standard in trade agreements. And they are about protecting NZ companies also. You may recall that the NZ Super Fund is suing the Portugal Government over the fact they treated the money invested by the NZ Super Fund differently to other investors in a bank. Without such provisions, then NZ companies can get treated differently.

The reality is Labour has signed trade agreements with investor state provisions. They are now voting for a bill that would have made such agreements impossible. This is again not a minor shift – this is a major reversal of 20 years of pro-trade policies from Labour.

The ASEAN FTA was negotiated by Labour and concluded in August 2008 and has investor state provisions.

The China FTA negotiated by Labour has investor state provisions.

The Thailand FTA concluded by Labour in 2005 has investor state provisions.

The Singapore FTA concluded by Labour in 2000 has investor state provisions.

So Labour signed FTAs with these provisions from their first year in office to their last year in office. They are totally standard in FTAs.

Their new policy to support a bill banning any trade agreements with them, is a de facto policy to never again sign a free trade agreement, and to walk away from all the trade agreements they concluded in Government. It’s pathetic pandering to the far left.

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Trevett on Labour and Northland

March 14th, 2015 at 12:00 pm by David Farrar

Claire Trevett writes:

For Labour the nod is a short-term gain, an attempt at a humiliating poke in the eye for National and a result that would make it harder to get a majority on legislation such as Resource Management Act reforms. But short-term sugar rushes are always followed by a crash.

Enter 2017 and the next election. The reason Peters is a reluctant beneficiary of Labour’s endorsement is because he knows Northland is inherently a conservative electorate. It is partly because Peters is also inherently conservative that he has a chance.

If he does succeed in putting the “win” into Winston, Labour could be handing National a future coalition partner.

An electorate seat would be a powerful security blanket for Peters. So far he has refused to say if he will stand again in 2017 – when he will be 72. It’s a safe bet he will if he wins the by-election, if only to try to cement his hold on the seat. If he chooses well, he might even get Northland to accept an NZ First successor (hello, Shane Jones?). He will not want to do anything that might imperil his party’s hold on the seat and return it to the precipice of the 5 per cent threshold.

Peters has felt the wrath of conservative voters scorned in Tauranga and knows it is National they flock to – and in bulk. Winning a seat in a by-election is one thing. Keeping it is quite another. If Peters wants to hold the seat come 2017, cuddling up to Labour is risky territory. So, if Peters holds the balance of power in 2017, Labour could well find its gift to NZ First was a gift to National in disguise.

Labour’s effective endorsement of Peters, if it works, may turn out to be one of their bigger strategic blunders.

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Labour’s intolerance of dissent

March 13th, 2015 at 12:00 pm by David Farrar

Phil Quin writes in the NZ Herald:

Others say I should take these criticisms inside the tent. In principle, this is correct – but there is a problem. The Labour Party does not tolerate dissent, not just in a cultural or attitudinal sense, but in its rules. Its governing bodies are elected en masse via first past the post. Sector Councils ensure minority groups have a place at the table, but there is tno space whatsoever for minority opinions.

Let’s take Labour’s stance on our contribution to the fight against Isis (Islamic State). I am one of a small number of members who disagree in principle with the party’s stand. This is a legitimate point of view, one shared by centre-left governments and political parties the world over. And yet, in New Zealand Labour, holding such an opinion renders you a sell-out, a secret Tory, an apostate.

What recourse do we have? Because members of the New Zealand Council are elected, clone-like, from the same plurality of members, there is no one capable of advocating on behalf of minority views or looking out for the rights of dissenters. This flows through all the party processes, including candidate selection.

If you are a social conservative or an economic liberal in Labour, you are baasically told you are in the wrong party.

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Does anyone think Labour would have made a different decision?

February 25th, 2015 at 9:00 am by David Farrar

I’d be interested to hear if anyone seriously seriously thinks that if Labour was in Government, they would have made a different decision about contributing to the coalition against the Islamic State?

I totally believe that the Greens would have. They absolutely and passionately believe that the way to defeat the Islamic State is to do something like employ more community facilitators in under privileged communities, and all will be right with the world. It’s a bonkers view, but a sincerely held one.

But not for one second do I think a Labour Government would have said “No, we will be the only country in Western World not to contribute in a military sense to defeating ISIL”. Which means that their rhetoric this week is just opposition, because they don’t actually have the responsibility to make a decision.

Bear in mind that the last Labour Government sent the SAS to Afghanistan, and military engineers to Iraq.

But I’d be interested to hear a rational argument by anyone that Labour would actually have made a different decision, if they were in Government.

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Labour’s new chief press secretary

February 23rd, 2015 at 1:00 pm by David Farrar

Labour have announced Sarah Stuart as their new head of media and communications.

Sarah is a former Deputy Editor of the Herald on Sunday, during its start up phase when it went from no customers to winning many awards. Since then she went on to be managing editor of the APN regional and community papers and then two years editing NZ Woman’s Weekly. She has a formidable media background, as both a journalist and an editor.

I think this is a strong appointment for Labour. Her background in both hard and soft news will be useful as they try to get Little’s brand set as a positive one. She should also be able to manage relations well with the press gallery. I’ve not had any dealings with Sarah for many years, but all my experiences has been she is very pleasant and likeable (which helps in dealing with a diverse caucus).

Social media may be a challenge for her, but that is what you have staff for.

Little has also confirmed former EPMU staffer Neale Jones as the party’s political director in Parliament and Martin Taylor as their research director. A good staff team don’t win you an election (the leader does that), but a non performing team can stop you winning. Little’s picks are looking quite sound.

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Crone on small business and Labour

February 13th, 2015 at 7:00 am by David Farrar

Xero’s Victoria Crone writes:

I recently attended Labour and Opposition Leader Andrew Little’s State of the Nation speech and heard first hand how the Labour Party is throwing its weight behind small business by placing a big emphasis on the small business agenda. …

There are a few areas where I think that they’re barking up the wrong tree, one being around starting a business. The World Bank Group already ranks New Zealand as the easiest place to start a business.

However, with small business firmly on Labour’s agenda, this bodes well for a great policy debate around small business for the next election.

I agree. I hope they come up with some innovative policy.

I see a few challenges for Labour’s small business policy:  

– Labour has a dilemma as it tries to encourage small business to create jobs. The first is the dilemma between what is essentially a nation of very small and often fragile businesses (remember 92 per cent of our small businesses employ less than five people and these businesses have the highest death rates), who will be taking on additional jobs which represents massive risk for them. A small business has to be able to sustain the extra cost of an additional employee over the long run. The average business owner is already wearing 20 hats. Adding managerial and employment policy to their already long list of day to day tasks will provide extra pressure.  Labour’s policy on encouraging job growth while minimising business risk could be challenging philosophically for the Party.

Most of Labour’s current policies are bad for small businesses. Their policy to scrap 90 day trials especially. But also their policy to massively hike the minimum wage, and make it illegal for a small business to gain Government work unless they pay a “living” wage.

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Du Fresne on Islamic State

February 12th, 2015 at 3:00 pm by David Farrar

Karl du Fresne writes:

It’s hard to think of a more challenging conundrum than the one posed by the Islamic State of Iraq and Syria (Isis).

Labour leader Andrew Little was right last week to describe Isis as evil. It’s a word seldom heard these days because it implies a moral judgment, and moral judgments are unfashionable. But “evil” is the only way to describe men who coldly behead their captives, and then amp up the shock factor by burning one alive.

There is an element of gleeful sadism in their barbarism. Last week they pushed a gay man from the top of a tall building – reportedly the fourth such execution for homosexuality.

Sadistic is a good work for it. It is not just that they revel in killing people, but they revel in killing them in such sadistic ways. Being thrown off a building or burnt alive as examples.

Almost unnoticed in the background, Isis is proceeding with its grand plan to establish an Islamic caliphate, which means systematically slaughtering or enslaving anyone who stands in its way. No-one, then, can dispute that Isis is evil. The conundrum is what the rest of the world should do about it.

This is why it is not a fight one can ignore. This is not just a localised civil war in Iraq and Syria. They literally wanted to expand to as many countries as possible. Anyone who thinks they will be content with what they have is detached from reality.

Yet doing nothing is not an option. Either we believe civilised values are worth defending and that vulnerable people deserve protection from mass murderers, or we don’t. And if we do, we can’t just whistle nonchalantly while looking the other way and pretending it isn’t happening. …

This is not like the wars in Iraq and Afghanistan, where the objectives were hazy (or in the case of Iraq, tragically misconceived). Isis is not some shadowy terrorist entity; it’s a functioning army, operating in plain sight.

That doesn’t make it easy to defeat, but neither is it an excuse to do nothing.

Unfortunately Andrew Little, while condemning Isis as evil, doesn’t think it’s our business to stop them.

It’s interesting that where Isis is concerned, the Left sharply deviates from its tradition of siding with the weak and vulnerable.

The Islamic State, it insists, is not our problem, no matter how many innocents die.

Labour’s policy is to do nothing but send out press releases.

I suspect the Left is unable to see past its antipathy towards America and can’t bring itself to support any initiative in which America plays a leading role. Its ideological blinkers blind it to the fact that on this occasion, America is on the side of the angels.

Most reprehensible of all is the craven argument that we should avoid antagonising Isis for fear that some deranged jihadist will strike at us in revenge.

That’s moral cowardice of the lowest order.

Prime Minister John Key is right to highlight the inconsistency in the Left’s stance, and I applaud him for saying that New Zealand will not look the other way.

It’s rare for Key to commit himself so emphatically, and commendable for him to do so on one of the pressing moral issues of our time.

Imagine if the 1st Labour Government was led by modern day Labour. Michael Joseph Savage and Peter Fraser committed NZ to fight against the Nazis. The Little led Labour would be insisting that we do nothing without the League of Nations okay.

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So what does Little mean by shared sovereignty?

February 10th, 2015 at 10:00 am by David Farrar

The Herald reports:

Prime Minister John Key says Andrew Little’s comments at Waitangi on Maori sovereignty were advancing “separatism.”

“I reckon he would be leading New Zealand completely down the wrong path,” Mr Key said at his post cabinet press conference today.

Mr Little told reporters the Waitangi Tribunal finding that Nga Puhi did not cede sovereignty should not be dismissed and that models of indigenous self-governance and law-making around the world should be explored.

“In 1840 when we singed the treaty, it strikes me we signed it for modern New Zealand, and that was a New Zealand where we co-habitated and ran the country together. It wasn’t about separatism. It was actually about community and Andrew Little is basically suggesting that we had down a path of separatism.”

He said he could not see New Zealanders supporting that.

As I said earlier, I look forward to Labour explaining what particular models of shared sovereignty they are thinking of.

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Robertson on Future of Work

February 10th, 2015 at 7:00 am by David Farrar

A thoughtful speech by Grant Robertson to Labour’s Future of Work conference. A part that struck me was:

In November received a visit from the joint winners of a prize I give to a local secondary school.  They had won the prize in 2013 and arrived at the end of 2014 to thank me and tell me how their year at university had gone.

It had gone well each in their respective disciplines of marketing and design. I asked them about their plans for the summer and holiday work. Thinking back to my glory days as an assistant in the fruit and veggie section of the local New World I expected to hear tales of bar work and retail.  Instead I was presented with two business cards, and a link to their design business that they had established during the year.  The summer was shaping up well with a client found through their on-line presence, and a sideline in stunning digital depictions of Wellington icons for sale at various market stalls.  

These two very capable young women did not see any boundaries between their study, commencing work, pursuing their interests or passions. They had the attitude, the skills and the security to do just exactly what they found interesting.  The future of work is bright, flexible, diverse and stimulating for them- and they will be a complete handful for anyone here trying to teach them.

I love this story. It is one of the things I love about the digital age, that so many young people are embracing the opportunities to do what they are passionate about, and are not dependent on an employer, or a degree. Such a story would have been near unthinkable 15 years ago.

The Commission’s mandate is to undertake a two year programme to develop a comprehensive understanding of the changing nature and experience of work and its impact on the economy, and to develop the policy responses required to meet the challenges and grasp the opportunities presented by these changes.

We believe that in order to be responsible leaders we must look to the future and prepare now. We owe to the next generation of New Zealanders that we are giving them the best possible chance to succeed.  We owe to a current generation of workers who feel insecure about their future and income that they can make transitions to new and fulfilling types of work.  We owe to businesses, small, medium and large that we have a plan for sustainable diversified, economic growth.

There is no room for complacency in such a period of rapid change, and by 2017 we must be in a position to tell New Zealanders what we are doing to face the future of work with confidence.  The Commission will be open to new and different ideas, to challenge our assumptions and policies. We will be prepared to change.  Our commitment is that with our core values firmly in mind, we are open to each and every idea that is put forward.

I will admit to a degree of scepticism that Labour will come up with anything more than their normal policies of payoffs for unions, extra costs on employers and less flexibility and choice in the workplace. But I hope to be wrong.

What Labour is doing with this two year programme of consultation and development on this issue is exactly what a good opposition should do. If they do it well, they’ll build credibility with stakeholders, show they understand the environment and issues, and come up with some genuinely new policies and solutions.

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Little wants to look at giving Iwi law making powers

February 7th, 2015 at 4:00 pm by David Farrar

The Herald reports:

Labour leader Andrew Little has proposed looking at giving Maori greater self-governance, possibly including the ability to make some of their own laws. …

He said it was time to look at what would happen after the settlements were completed.

He said some Native American tribes had law-making powers over their territories in the United States where recognised tribes were exempt from some laws – including taxation – and could create their own laws in many areas. Mr Little said allowing separate law-making was “highly problematic”.

“But we shouldn’t be so dismissive of any claim by iwi over what they do. We do have to function as a nation-state and we don’t want to compromise that. But let’s have a look at it.”

I encourage Labour to clarify their thinking and be very specific in their 2017 manifesto as to what law making powers they think Iwi should be given.

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Two nominees for Labour President

January 27th, 2015 at 1:00 pm by David Farrar

The Herald reports:

An Auckland University lecturer Nigel Haworth and City Vision chair Robert Gallagher have put themselves forward to be the Labour Party’s next President.

Professor Haworth lamented in 2012 that China, India and Russia joining the global economy in the last few decades, as it has been bad for ordinary working people. Never mind the fact that it lifted hundreds of millions in those countries out of poverty and starvation.

Gallagher is an experienced campaigner and I’d say the favourite. He has strong support in Auckland. I think both will struggle to boost fundraising though, which is a real weakness for Labour currently.

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Labour’s media targets

January 15th, 2015 at 2:00 pm by David Farrar

Stuff reports:

Expect to see Labour leader Andrew Little in a good light on the 6pm television news – or questions to be asked at the top of his media unit.

Little is advertising for a new chief press secretary to head the party’s media and communications strategy, and the successful applicant is expected to ensure Little appears “in a positive story on the 6pm news at least twice a week”.

Have TVNZ and TV3 signed up to this?

Other key targets put emphasis on social media, including 100,000 “likes” for the party’s Facebook page, up from about 38,000 now, and 40,000 “likes” for Little’s Facebook page by the 2017 election. It currently boasts 10,422 “likes”.

Will buying likes and followers count?

The advertisement has already prompted senior press gallery reporters to plot creative ways to thwart another expected result – weekly meetings with key press gallery journalists.

And who is defined as key?

Little’s chief of staff, Matt McCarten, said the targets were guidelines and the reference to the 6pm news was a “throwaway comment” designed to show the aim was to be proactive, not just reactive, in the news.

A throwaway comment in a formal job description?

A source said the Facebook page was fed by the parliamentary party as well as the party’s head office, so setting targets for the new media boss, who will report to McCarten but is employed by Parliamentary Service, did not breach Parliament’s funding rules. 

I wouldn’t be so sure about that.

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