Kiwiblog

An interesting academic paper by Hilde Coffe:

This paper investigates gender differences in voting for the two major parties (Labour and National) and the two main small parties (Green and New Zealand First) at the 2011 New Zealand general election. In contrast to the gender gap found in many post-industrial societies with women being more likely to lean towards the left than men, this study reveals limited differences in party preferences among men and women in New Zealand.

The only substantial gender difference is found in relation to voting for New Zealand First, with women being substantially less supportive of the populist party than men. This gap is robust and remains substantial even when gender differences in socioeconomic characteristics and issue positions related to the role of government, the welfare state and the presence of immigrants are taken into account.

Interestingly, while no gender gap occurs at first sight in support for the mainstream right-wing party National, a gap does arise once gender differences in policy issue positions are controlled for, with women being more likely to support National than men.

As the author states, it is usual for women to vote more left than men. In NZ at the last election, this did not occur. In fact National arguably gets more support from women than men. Why? The obvious answer was the appeal of John Key, but the author included that as a variable – and there was still a difference.

David Fisher at HoS reports:

Leaked documents written by a political strategist who has trained National MPs set out a vision for taking the party to the right of the political spectrum, tripling donations to $6 million a year and using donations and government jobs as inducements to control MPs.

Written by political strategist Simon Lusk, the papers were leaked by a “senior National Party source” to theWeekend Herald, TV3′s The Nation and Fairfax.

I’d never seen the papers before this week.

The message was also important – “dominate the media by controlling the message through credible right wing blogs”. Mr Lusk also said there needed to be a focus on “taking over the public sector” to create a pool of fiscal conservatives who would work with politicians.

I’d  rather shrink the public sector than take it over

He urged those reading it to “stop donating to the current government”. “They have not listened and will not listen.”

Not surprisingly, a strategy of urging people not to donate to the party doesn’t meet universal popularity.

Incidentally National disclosed donations of $773,000 last year. That doesn’t include donations of under $1,500 which can also account for hundreds of thousands of dollars.

Mr Lusk’s briefing came at a time when he was organising training sessions for potential National Party candidates. Disgraced MP Aaron Gilmore was among those keen to attend but was rejected after he failed to meet the fees charged.

As far as I know, the training sessions were free to attend, but invite only.

Longtime National Party member David Farrar, who runs Kiwiblog, was listed as a speaker at a February 2012 session at the Kauri Glen Lodge in Puhoi, north of Auckland, where the session was held. He pulled out.

“I was asked not to,” he said, saying “party hierarchy” made the request. “It would look as if it were officially sanctioned,” he said. He stayed for the social aspect – Mr Slater posted on his Whaleoil blog a photograph of Mr Farrar’s rental car reversed over a wall – before leaving.

Whale loves posting that photo.

The National Party is a broad church, with many factions. They include:

Blue Greens

They’re National but they’re conservationists. Nick Smith is the greenest blue in the party.

Blue Liberals

National with a heart – Katherine Rich showed her liberal streak when she rejected Don Brash’s social welfare plans.

Fiscal Conservatives

Small government, big business. Former party leader Don Brash later ran Act.

Internats

The overseas wing of the party. Prime Minister John Key is the ultimate homecoming story.

Young Nats

The path to the party from an early age. Nikki Kaye is currently the youngest minister in the House.

SuperBlues

The superannuitant wing. Dr Paul Hutchison has just picked up his Gold Card.

I wouldn’t really call them factions. Most “factions” in National are personality based rather than policy based.

Also the Blue Liberals are not wets, they are classical liberals who tend to be “fiscal conservatives” and social liberals – ie people who think the Government should but out of both business and our private lives.

In a related story, David Fisher writes:

A political strategist who has trained National Party MPs says the Ports of Auckland colluded with right wing bloggers to undermine industrial action against the Ports of Auckland.

The claim is in a leaked document written by controversial strategist Simon Lusk – and hotly denied by the publicly-owned port company. …

“The case in point is the way the Maritime Union have received huge negative publicity about their salaries, based on POAL (Ports of Auckland Limited) working with certain bloggers to control the story. Financial support for these bloggers will enable them to build their credibility and readership.”

I was asked about this. I have never had any communication or contact with Ports of Auckland, or anyone acting on their behalf, with regards to this issue. Off memory the only time I’ve had contact with them if when I blogged they should be shifted to Manukau Harbour! They are not keen on my proposal!

Mr Slater said he covered the strike as other media outlets did. He said there was no arrangement with the port to do so and he had not discussed it with Mr Lusk.

He said yesterday he had never actually been paid although believed he should be. On the port, he said: “I hate unions pathologically. I’ve hated them since I was 15 years old and I would do it for free.

“I have never been paid for any posts about unions, ever.”

Some things are just a pleasure!

15 May 2013_Party Positions on MMP

A useful table showing the total lack of consensus on the MMP recommendations.

I’d be careful concluding that retaining the status quo is beneficial to National. Neither United Future or ACT got any List MPs via the one seat threshold in 2011, and frankly I am dubious they would so in 2014.

If anything the party most likely to bring in a List MP might be Mana.

Also lowering the threshold from 5% to 4% is most likely to benefit the Conservative Party, which is a potential coalition partner for National. So again retaining the status quo is not really of much benefit to them – in fact could disadvantage them.

The Herald editorial:

The public can only wonder how somebody like that can get into Parliament.

Nobody elected him. He came in on National’s list in 2008 but could not make it back to Parliament on the list in 2011 even though that election increased National’s proportional representation. The previous year this newspaper revealed he did not have a finance industry qualification claimed in his CV.

Now he is back filling a vacancy left by Speaker Lockwood Smith’s departure. This unfortunately is typical of the list system. People near the bottom of the list come and go without the public noticing or knowing much about them.

It is often claimed that the same could be said of many electorate MPs who are largely unknown outside the electorate. But they are well known within it. Before their election they have faced public meetings, attended local gatherings, made a point of meeting and talking to as many voters as possible.

List MPs may do the same but they do not face the same test. It is hard to believe someone who behaved as Mr Gilmore apparently did would win even a safe National electorate. Word gets around.

The fact he is in Parliament suggests National’s list exceeds its depth of presentable candidates.

Not quite, but it is true that most parties get some quality issues at the lower end of their lists. However this situation is partly of National’s own making.

In 2008, Aaron was ranked No 56 on National’s list, and he was the list person in on their list.

In his first term he didn’t endear himself universally. That’s now because he isn’t without skills – he’s got a good understanding of policy, and is a good debater in the House – but because he does some stupid things.

So in 2011 he was one of two MPs ranked at the bottom of the caucus on the party list, and they were not returned in the general election. Since then however two vacancies have occurred, and hence the two List MPs not re-elected were given opportunities to return.

But while they were ranked at the bottom of the caucus, they were not at the bottom of the list. They were both given places potentially winnable and this is because National has made a “policy” decision at the last three elections to rank existing List MPs above new candidates, except when the new candidates are deemed exceptionally talented or have special appeal.

In 2005 the only candidates ranked above current List MPs were Tim Groser and Chris Finlayson.

In 2008 the only candidates ranked above current List MPs were Steven Joyce, Hekia Parata, Bakshi Singh and Melissa Lee.

In 2011 the only candidates ranked above current List MPs were Jian Yang, Alfred Ngaro and Paul Goldsmith.

When you are in Government with small majorities, I understand the desire to not have incumbent MPs given unwinnable List places. However there is a price to pay when you do protect the caucus.

By this I don’t mean in any way that I believe incumbent MPs should be treated more harshly – far from it. I just think that when it comes to list ranking, MPs and candidates should compete fairly on their qualities as individuals – not dealt with collectively.

There are in fact a number of people lower down National’s List who would make solid MPs – Paul Foster-Bell (who is now there), Claudette Hauiti, Jo Hayes, Leonie Hapeta, Denise Krum, Viv Gurrey, Brett Hudson etc (not an exclusive list).

The problem is not that National won too many seats. The problem is that it protected its existing caucus and ranked them ahead all bar three new candidates. Now again, there are reasons why that can be politically desirable. But there are also reasons it is politically undesirable, as we have seen this week.

Stats NZ released Q1 2013 inflation data today. The CPI went up 0.4%, and only 0.2% if you exclude the increased excise tax on tobacco. This brings the annual inflation rate to 0.9% which is good.

I had a look at the electricity component of the CPI and power prices went up only 0.15% in the last quarter.

National has now been in Government for 17 quarters. The total increase in electricity prices over those 17 quarters has been 16.4%.

During the last 17 quarters of Labour, electricity prices increased 33.1%.

The moral of the story is it is very easy to promise things. But I think you need to judge those promises against their record.

Rodney Hide writes in the HoS:

The frightening part for Labour leader David Shearer forgetting to declare his $50,000-plus offshore bank account is National’s response: next to nothing. The Prime Minister said simply that Shearer’s memory lapse was “unfortunate”.

Unfortunate? That’s scary.

The usual political playbook is straightforward: 1. Make the account suspicious; 2. Keep the story alive; 3. Ensure a public inquiry; 4. Bust Shearer.

The political play is best run by an up-and-coming backbencher. Ministers must be seen as too busy running the country to be bothered.

The backbencher doesn’t allege any wrongdoing. That requires evidence. The only concern is perception.

The backbencher kicks off by asking why an MP and party leader would ever need an offshore bank account. “The political leaders who have secret offshore accounts aren’t the sort we usually have in New Zealand.”

The story is kept alive by pressing hard through the media with new questions every day. Day Two: “Mr Shearer must come clean with just how much he has in his secret account.” Of course, Shearer will refuse. Good.

Day Three: Allege it’s over a million dollars.

Journalists do the rest. They put the million-dollar figure to Shearer. If he doesn’t deny it, then a million dollars it is. If he denies it’s a million, the journalists won’t let go until he declares how much it’s below a million. The account’s dollar value is secured easily enough.

A new day, a new question. When did he last use the account? Who put the money in? When and why? Why hasn’t he closed the account? On and on it goes.

The public inquiry is achieved by making a Breach of Privilege complaint. It’s impossible for Parliament’s Speaker to refuse. If failing to declare $50,000-plus in a foreign bank account is not a breach then MPs are free to declare Mickey Mouse or whatever on their register of interests.

The resulting Privileges Committee is media gold. Shearer must front to a committee of senior MPs, most of whom are on the Government’s side. The questioning is in public, on camera. Week after week he must explain to incredulous MPs how he forgot about having tens of thousands of dollars in an offshore bank account but somehow remembered every year when he completed his tax return.

The whys and wherefores of his overseas banking would be dragged out of him. The committee would want his banking records. He would have little choice but to supply them.

I have absolutely no doubt that what Rodney describes is what would have happened if it was a National Party Leader who failed to disclose for four years in a row a foreign bank account.

Rodney has a theory about why:

But National has done none of this. That means only one thing. National want Shearer right where he is: leading the Labour Party into the next election.

Heh. I think that is reading too much into it. I think it is rather not wanting to appear to be too sanctimonious.

An interesting article by John Armstrong on why he thinks National was at 49% in their last poll. A summary of his 10 reasons is:

1. Key’s sky-high rating as most preferred Prime Minister
   
2.  Key’s moderate conservatism
3. Key is unashamedly pragmatic
4. Neutralising of troublesome issues rather than allowing them to linger and fester
5. A majority of voters view National as the better manager of the economy
6. Good at maintaining momentum
7. National is still largely defining what the arguments are about in most policy areas
8. Opposition parties are instead still devoting considerable time and effort to fighting battles they have lost
9. Public getting acclimatised to the rather chaotic nature of minority government
10. Few, if any, issues that are seriously divisive and on which National finds itself stranded on the wrong side of the argument for ideological reasons

I would also add on that the alternative looks chaotic and unconvincing.

In another article, three Herald staffers look at Key’s personal popularity. First Armstrong again:

Why is John Key still riding high in the polls? Put it down to several factors. First, an understanding of and empathy with the New Zealand character and what is acceptable and not acceptable. His moderate conservatism is straight out of Sir Keith Holyoake’s textbook.

Key’s second priceless asset is his finely-honed political instinct in which he has the sense to trust – even when receiving advice to the contrary. Few leaders who have spent six years in the job would have their feet still firmly planted on the ground. He is never aloof. Nor arrogant. He does not talk down to people. He can laugh at himself. …

Key’s affable nature is not a false front to be worn solely for public consumption.

Claire Trevett touches on that last point:

His show of a good-natured, even-tempered, self-deprecating personality is one of his most potent weapons. It makes him seem approachable, and that helps explain why his personal ranking is so high above his party’s popularity. It also blurs the fact that he is wealthier and more powerful than most voters. If his Government is having a hard time, the next time he gives a speech he’ll get in a self-mocking joke about it, a tactic that simultaneously acknowledges the headache it is causing him while getting across the message that it is not as major an issue as is being made out. …

His sense of humour is his most underestimated asset. Voters get bored of leaders – it is one of the most corrosive factors on their popularity. Only tyrants and comedians can slow the process of that boredom. Labour cannot abide it, and that alone shows how powerful Key’s persona is.

While Liam Dann says:

As the Bill Clinton campaign slogan said: it’s the economy, stupid.

People vote with their pockets even when they are complaining about myriad other issues.

And I don’t think voters think the economy will do better with a Labour-Green-NZ First-Mana Government.

John Key has announced:

Prime Minister John Key has announced the election of National’s new whips following the National Party Caucus this morning.

Mr Key says the new senior whip will be MP for Taupo, Louise Upston.

Louise Upston has been promoted to senior whip from junior whip after Mr Key announced last week that Michael Woodhouse will be a Minister outside Cabinet.

The new junior whip will be MP for Hamilton West, Tim Macindoe.

MP for Botany, Jami-Lee Ross, has also been appointed to the newly-created position of third whip.

The Remuneration Authority determined in its annual review last year that political parties with more than 45 MPs will have funding for a third whip.

Being a whip is pretty demanding job. A whip has to be in the House almost all the time, as they are the ones who have to make sure leave is not granted to any delaying tactic from the opposition (such as I seek leave for a 10 hour debate on the price of milk). If you don’t object within a few seconds, then bang the House has so resolved. They also allocate speakers to bills, grant leave to MPs who want to attend engagements during House sitting hours, and generally manage caucus discipline.

The senior whip almost invariably goes on to become a Minister in due course. I can’t recall the last time a National Senior Whip did not become a Minister.

Labour MP Chris Hipkins blogged yesterday:

Just before Christmas the Remuneration Authority released their determination regarding MPs pay. Naturally, all of the media focus was on the fact that MPs were getting a pay rise just before Christmas and it was to be back-dated. Personally I agree with the idea that MPs pay and entitlements should be set on a 3 yearly basis and changes should only come into force following each election, but that’s a discussion for another day.

Pleased to see Chris supports pay and entitlements being set that way. I’d advocated that position for a long time, and hopefully the Select Committee will recommend it when they report back on the MPs Remuneration Bill.

Hidden away in the determination was another interesting little change. Political parties with more than 45 MPs are now entitled to a second junior whip position. So with Michael Woodhouse taking on a ministerial role, and Louise Upston almost certain to step in the Chief Whip’s shoes tomorrow, National will now have to elect two new junior whips. The smart money seems to be on Tim McIndoe and my Breakfast TV sparring partner Jamie Lee-Ross.

Smart money indeed.

I agree with the decision to increase the number of whips big parties can have. It’s a big job and under MMP it’s getting even bigger. But it’s interesting the National government decided to implement the change now, rather than wait until after the next election, when it wouldn’t look quite so much like they were changing the rules to suit their own interests.

Chris is being a bit mischievous here. The Remuneration Authority decided, not the Government, that a party with over 45 MPs needs a third whip and will fund it. we’re not talking a huge amount of money by the way – a whip get $14,100 more than a normal MP.

Of course a party could appoint as many whips as they want. They just won’t get paid extra, unless the Remuneration Authority agrees there is a need. In fact in the early 1990s National had a third whip because their caucus was so large.

This is like that the Greens don’t get two leaders’ salaries. I presume they split the extra pay between the two of them. So it is up to each party to work out what they need, but the Remuneration Authority decides the level at which you get extra funding for such roles.  So the current rules are:

• 1 to 3 MPs: No whip
• 4 to 24 MPs: One whip
• 25 to 44 MPs: Two whips
• 45+ MPs: Three whips

David Shearer is going to give a speech next week and claim the Government is a hands off economic manager, and Labour will be a hands on economic manager and this is the big difference. It’s a speech that may have been true in the early 90s, but anyone who seriously claims the Key Government is hands off is letting ideology get in the way of reality.

Personally I think the Government should be more hands off. I think many economic interventions are well intentioned but often have unforeseen consequences.

The Press reports:

A large Canterbury irrigation scheme may be among the first considered by a new Crown company that will act as a bridging investor.

Minister of Primary Industries David Carter said yesterday that the Government was setting up a company that would invest in feasible, affordable and profitable irrigation schemes.

The Cabinet decided late last year that a company was needed to run the Government’s $400 million irrigation fund. It would receive $80m in this year’s Budget for its first year of operation, he said.

It was appropriate the Government took the investment role to ensure the right projects got under way, Carter said.

“The Crown-owned company will be a minority investor in any development project and it will also plan to be a relatively short-term investor,” he said. “A number of groups are developing proposals for these larger, regional-level schemes, and the Government expects to consider at least one proposal in the next 12 months.”

Irrigation New Zealand called the move “well deserved”.

Chairman John Donkers said irrigation schemes were a huge financial pressure for farmers and farming communities.

“For many years farmers have personally carried the cost of water infrastructure, which can run into the millions of dollars yet benefits regional economies enormously,” he said.

“Having a government-owned company invest in the initial stages takes the pressure off small communities to find that kind of capital upfront. The benefits for regional New Zealand can’t be underestimated.”

It was important to realise the Government was not giving away money. “This is equity funding. The Government is going to want it paid back over time,” he said.

So when David Shearer claims the Government is ideologically averse to hands on involvement in the economy, I hope someone asks him about the $400 million irrigation fund, the $1.5 billion for ultra-fast broadband, $100m for export assistance, $15m for business capability, $30m for sector and special events, $30m for international growth opportunities, $50m for large budget screen productions, $10m for major events, $12m for venture capital, $10m for primary industry grants, $9m for sustainable farming, $70m for primary growth partnerships, $220m for CRI funding, $178m for high value manufacturing and services research, $106m for biological industries research, $84m for health and society research, $47m for Marsden Fund and so on.

Anyone who thinks John Key, Bill English and Steven Joyce are neo-liberal hands-off ideologues is somewhat demented. Personally I wish they were a bit more hands off.

This is not to say there are no differences betwee National and Labour in terms of how involved the Government should be in the economy. There are differences, and reasonably important ones. Labour thinks the Government must own 100% of certain assets, for example. But the current differences between National and Labour in terms of involvement in the economy tend to be around the details, not a fundamental disagreement that the Government has a role in economic development. ACT has that view. Ruth Richardson (God bless her) has that view.

Shearer knows there are few votes to be won in claiming “our interventions in the economy will be better than National’s”. So what he will try and do is say National doesn’t intervene at all, and we will. He hopes enough people will believe that. The truth is far more mundane.

Well John Key managed to surprise me and most other people, and has done a quite significant reshuffle, with a substantial rejuvenation of the Ministry.

Those leaving the Ministry are:

• David Carter to become Speaker
• Kate Wilkinson
• Phil Heatley

Kate and Phil have performed well in their portfolios, and their departures are not sackings. It is simply the reality I talked about this morning that you need rejuvenation.

Promoted direct into Cabinet is Auckland Central MP Nikki Kaye who has become Minister of Food Safety, Civil Defence and Youth Affairs and Associate Minister of Education and Immigration. She will be the youngest female Minister in National’s history.

Senior Whip Michael Woodhouse becomes a Minister outside Cabinet as Minister of Immigration, Veterans’ Affairs and Associate Transport.

Simon Bridges moves into Cabinet from outside and gets more grunty portfolios of Labour and Energy.

Oh and as expected Nick Smith moves back into Cabinet as Housing and Conservation Minister. Paula Bennett is made Associate Housing.

Nathan Guy as expected gets Primary Industries and Jo Goodhew Associate.

Chris Tremain pciks up Local Government Minister.

And in a very good move Steven Joyce is put in charge of Novopay, and fixing the problems there.

The caucus will need to elect a new senior whip, but I can’t imagine any reason whu junior whip Louise Upston won’t succeed to that – so the focus is probably more on who from 2011 may step up to become junior whip.

I’m delighted that the PM has been bolder than expected, and effectively brought forward what I thought would be a year end reshuffle. And I’m looking forward to the new Ministers making a difference in their new portfolios.

Big thanks to Phil and Kate also for their service.

As an centre-right person it is no surprise I have supported most of what the Government has done. But that doesn’t mean there have not been issues where I disagree with them, or support something from other parties, or give an opinion that isn’t helpful to the Government. I’ve had a quick look through the archives, and below are a surprising large number of links:

• I say National is the under-dog for 2014
• I call for Cabinet to be reduced from 20 to 12
• I call for significant caucus rejuvenation for 2014
• I labelled the National MPs blog “the greatest cure for insomnia ever invented” and a typical post as “so mind numbingly boring, that I only subject my eyeballs to them around twice a year, as they start bleeding as I read about some organic carrot farm they have opened“
• I blog in favour of Labour MP David Clark’s Mondayisation bill
• I praise Winston for his scrutiny of Whanua Ora
• I call for more funding of the Ombudsmen
• I blog in favour of removing the one seat threshold for MMP
• I say we should be ashamed of the slavery on our seas, and blog on this several times calling for the Govt to take action
• I support Trevor Mallard’s call for significant SOPs to be provided in advance to the opposition
• I supported the call for a full independent inquiry into the ACC Pullar issue
• I expose Vic Uni’s attempts to scam the PBRF system
• I said that taxpayer funding should not be used for Judith Collins lawsuit (it wasn’t)
• I label the first three months of 2012 as National’s Quartus Horribillis
• I mock the claim Murray McCully is not a micro-manager, saying “If Murray isn’t a micro-manager, then Grace Quek is a virgin“
• I submit to the MMP review for lowering the 5% threshold to 4%. My submission disagrees with National’s submission on almost every issue.
• I give Green MP Julie-Anne Genter a guest post on Roads of National Significance
• I support Charles Chauvel and Law Commission on a three warning approach to cannabis
• I pronounce the ACT Party dead
• I criticise John Banks for his lobbying on behalf of Kim Dotcom, knowing he was a likely donor.
• I blog in support of the Meatworkers Union over a proposed employment contract from Talleys
• I support Labour MP Su’a William Sio over comments he made
• I support David Shearer’s call for cross-party talks on superannuation and lifting the age to 67.
• I actively campaign against the Government’s proposal to raise the alcohol purchase age for off licenses.
• I call National’s stance on superannuation as fiscally not credible, and could damage them in 2014
• I criticise the handling of the Budget announcement on class sizes
• I support Labour’s criticism of the Housing NZ call centre
• I profile the 7th Labour Government and predict Jacinda Ardern will be the Prime Minister of it
• I call on the Govt to set up a royal commission on retirement savings
• I support some of Labour MP Iain Lees-Galloway’s alcohol law amendments on advertising
• I blog support for Labour MP Maryan Street’s euthansia bill
• I say the proposed constitutional reforms for Labour should result in a stronger party for them.
• I praise the appointment of Tim Barnett as Labour Party General Secretary
• I say it is not good that John Banks signed a donation return saying he did not know who his donors were, when he was involved in personally receiving two of the donations.
• I blog on how opposition MPs have made a positive difference with their private members bills
• I support the partial opening of Parliament up to the OIA
• I again say National should support David Clark’s Mondayisation bill
• I called on the Govt to delay the partial asset sales, to wait for the Waitangi Tribunal Report
• I criticise National for not getting more members bills into the ballot
• I blog several times in favour of Labour MP Louisa Wall’s marriage bill
• I slam the decision to delay the Ecan elections as “wrong”
• I praise Winston for his motion recognising Nancy Wake’s 100th birthday
• I praise Labour’s policy on reading recovery
• I say there is “no excuse for a mistake of this magnitude” on the incorrect info re a possible merger of Shirley and Chch Boys High Schools
• I criticise the Government for not supporting greater protection of the Ross Sea
• I support introducing a PMs question time to Parliament, to allow greater questioning of the PM
• I say there should be an inquiry into how NZ authorities deal with extradition requests
• In relation to the Chch schools announcement I say “I’m staggered by that degree of insensitivity and stupidity” and that “almost everything about the announcement was flawed”
• I publish staff numbers for ministerial offices
• I say the Govt should repeal Section 6A, not amend it
• I again label the Ecan decision inexplicable and “ wrong in principle and it’s wrong politically”
• I blog in support of Clare Curran’s amendment to the Patents Act, and against the Govt SOP, saying I hope ACT and United Future vote against National on this issue
• I say there must be a full inquiry into the MSD data breach and encourage donations to Keith Ng for his work
• I support Kevin Hague’s adoption reform bill
• I agree with Phil Goff on the pay rise for the MFAT CEO
• I support Gareth Hughes’ copyright bill to allow parody and satire as fair use
• I call for the Govt to hold an inquiry into the GCSB, modify the Chch schools proposal and change their stance on ECan elections
• I support Sue Moroney’s amendment to have calorie information on alcohol
• I say heads must roll over the MSD data breach
• I criticise National for the bill which would ban drug sniffer dogs from schools
• I blog Audrey Young’s ratings of National Ministers and comment they “have been a bit generous to a couple of Ministers”
• I blog against a National MPs members bill
• I criticise the Govt’s cellphone in car ban
• I credit Winston for his handling of the Horan allegations
• I say the Govt should not subsidise fibre with copper
• I praise aspects of the Greens ICT discussion paper
• I later say “I’m quite dismayed [with] the Government’s response to the Commerce Commission’s draft copper pricing determination” and “To be blunt the Government should shut the hell up on the Commerce Commission’s draft determination.”

I will use this post as a reference point for the next idiot who states that I always agree with National and never criticize them.

Tracy Watkins compiles some of the challenges ahead for National:

• A November High Court hearing on the Waitangi Tribunal water ruling, which could spark fresh division if it goes down the path of ownership;
• A constitutional review, which could also stray into potentially divisive race issues.
• A string of inquiries and investigations including the Paula Rebstock-led probe into leaks at the Foreign Affairs and Trade Ministry, which has the potential to shatter reputations and snare senior public servants in its net.
• An auditor-general’s inquiry into the horse-trading over a national convention centre built by SkyCity in return for a quid pro quo promise to allow more pokie machines.
• Ongoing inquiries into ACC privacy breaches.
• The never-ending Dotcom saga, which still has a long way to play out in the courts and includes the investigation into the GCSB.
• A housing affordability study next week, which has impossibly high expectations of an enduring solution to meet;
• And a report to State Services Minister Jonathan Coleman on the air force Anzac Day crash, which killed three servicemen. One report has already damned the safety culture at RNZAF. The Labour Department (now part of the Business, Innovation and Employment Ministry), responsible for workplace safety, may also come in for heavy criticism.

I’d say the two big ones are the High Court ruling on the Waitangi Trinual ruling and the AG inquiry into the convention centre proposal. The former because an adverse ruling would derail a major policy plank of the Government’s. The latter because it involves the PM.

The MFAT leak inquiry may be interesting but not likely to impact the Govt itself. The ACC reports are unlikely to turn up anything not already known, and may in fact leads to problems for Labour with the defamation suit against Mallard and Little.

There could still be some stuff to come out with the Dotcom issue and GCSB. This could still get quite big – but there is little the Govt can now do but let the legal system flow.

Housing affordability I will cover later, and the RNZAF crash while tragic – is not likely to be a major issue for the Government itself.

The end of the year is not without a potential landmine for Mr Shearer either; the auditor-general could release her report into former minister Shane Jones’ handling of an immigration case involving Chinese national Bill Liu. Mr Liu, who goes by several names, was earlier this year found not guilty of making false declarations related to his immigration and citizenship application, despite a High Court judge declaring the case to be highly suspicious.

Mr Jones was stood down by Mr Shearer when the auditor-general launched her inquiry. Mr Liu was a substantial donor to the Labour Party. A damning report would sink Mr Jones’ political career. But a less-than-damning report that also falls short of completely exonerating Mr Jones would be an even bigger headache for Mr Shearer.

Overshadowing all else are the Canterbury earthquake and Pike River inquires, both due by the end of November. Both will require a political response from the Government that gives comfort to the families of the victims of both disasters that lessons have been learnt.

The two Royal Commissions are opportunities and threats. The Government basically needs to adopt pretty much everything they recommend, unless there is a very very strong reason not to.

And the Shane Jones and Bill Liu case is eagerly awaited. It may not reveal anything new, but even what has been revealed so far is damning.

The latest Roy Morgan poll is sober news for National. They are still 8% ahead of Labour, but 5.5% behind Labour and Greens combined. On this poll the seats would be:

• National 51
• Labour 41
• Greens 17
• NZF 8
• Maori 3
• United 1
• Mana 1

You need 62 seats to govern, so either Lab/Gre/NZF or Nat/NZF/Maori. United Future and Mana might be there but wouldn’t make the difference.

The Roy Morgan poll can be quite variable but they have shown a 5% drop for National in the last month, and with the constant bad headlines this is not surprising. The Government is still progressing some very good policies, and making progress on the economic front (despite the high profile job losses).

I think the Govt needs to do a number of things to regain momentum. They include:

• A commission of inquiry into the GCSB. The fact three other cases have been disclosed as being of uncertain legality gives the Govt grounds for this. Without an inquiry, the issue will drag on for the next six months or longer. The GCSB, with all respect, has displayed signs of incompetence.  It is almost unforgiveable that they took two weeks to recall that Kim Dotcom had been mentioned to the PM at a general briefing. They should have located that within hours, not weeks. I personally don’t believe there has been any ill intent, but there has been enough errors made, that it is difficult to see public confidence being restored without a more rigorous inquiry – not just into Dotcom. Such an inquiry could also review the legal framework around the GCSB, so it is future looking also.
• Significant change to the Christchurch schools debacle. It could well be that all the changes are justified, and sensible in the long-term. But the why it was done has resulted in such ill feeling, that the Government needs to go for less change there. People know some stuff has to change, but go for the essential, not the “ideal” in terms of efficiency.
• Amend the ECan legislation to make it a hybrid body as the Commissioners recommended. When not even the Commissioners are wanting to stay on as a purely appointed body, you have to ask why would the Govt do this?
• Deal with the child poverty campaign (which is in fact a campaign for higher taxes and more welfare). National’s policies around welfare reform, national standards, reducing child abuse, better domestic violence laws are in fact all about reducing real child poverty, and giving more kids a better start in life. The left’s only answer to these issues is tax and spend. They won’t confront the much tougher issues of welfare dependency, the bottom 20% of students etc. National will. But National is not making the case well enough, and allowing the left to define child poverty as being just about “relative poverty” which in fact is just another name for income inequality.
• Position the left as the party of higher costs for struggling households. People forget they want to ramp up the ETS so petrol and electricity prices increase. They want more inflation, which will hit struggling families. They want more taxes.

All Governments have had spells when they struggle in the polls. It happened to Labour six months into their first term (the winter of discontent). It seems to be happening to National six months into their second term. The challenge is to respond to it, and respond to it well.

The Government has announced:

Commissioners will continue to govern Environment Canterbury after the 2013 local authority elections, Local Government Minister David Carter and Environment Minister Amy Adams announced today.

“In the interests of Canterbury’s progress, and to protect the gains the Commissioners have made, the Government has decided the best option is to continue with the current governance arrangement,” Mr Carter said.

A Bill amending the Environment Canterbury (Temporary Commissioners and Improved Water Management) Act 2010, to extend Commissioner governance until the 2016 local authority elections, with a ministerial review in 2014, will be tabled in Parliament today.

This is the wrong decision, in my opinion. I do not believe “They are doing a good job” is adequate justification for treating Canterbury different to the rest of NZ, and carrying on with appointed Commissioners.

My views are:

• The original decision to sack the Environment Canterbury Council was absolutely justified, and necessary. The Council had proven incompetent over many years, and it is to the Govt’s credit they had the balls to step in. A very unhealthy culture had led to a dysfunctional Council with both governance and staff issues.
• The Commissioners have done a very good job. They have made more progress in a couple of years than the elected Council had in a decade. They have worked really well at balancing the interests of competing stakeholders in a fair way.
• However that is not a good enough reason to not have the elections, as originally promised in late 2013. The Commissioners work in changing the culture and the processes should allow a new elected Council to carry on their work.
• If the Government was looking at a restructure of regional and district councils, then that would be an acceptable reason not to have elections for a body which might disappear or be merged in the near future. But this has not been cited as a reason.
• The Canterbury earthquakes do absolutely mean that you have had to make some decisions more centrally. CERA and the CCDU have done overall very good jobs in restoring Christchurch. There is no way the Christchurch City Council could possibly have done it by themselves.
• However ECan was sacked because they were incompetent, not because of the earthquake. And their responsibilities do not have, as far as I can see, much bearing on the rebuilding of Christchurch.

Ultimately the decision made by Government seems to be based on “The Commissioners are doing a better job than what a new elected Council may do”. Now this may be right, but it is not a reason to not have elections. If you appointed me Commissioner of Wellington City Council, I reckon I’d do a better job than the elected Council. But that is not a reason to not have WCC elections.

If the Government wants to propose no regional council elections at all, and that all regional councils should be appointed (either by Government or territorial authorities), then that is a debate you can have. For example, I do not believe DHBs should be elected as they dilute accountability of central Government.

But I do not see any principled reason to continue with appointed Commissioners in Canterbury. The earthquake is a red herring when it comes to the regional council.

The Government did the right thing in sacking the Council and appointing Commissioners. They have done a very good job. But they made a pledge to bring back an elected Council by end of 2013, and they should honour that pledge. The case for change has not been made.

Incidentally I wonder if National has the numbers to pass their proposed bill in the House. I would not take for granted that ACT and United Future would vote for it.

I missed 10,000 Green votes in 2011 when calculating the election outcomes based on the Electoral Commission recommendations. In fact it is National, not Greens, who would lose one seat.

Putting aside the principled issues, this makes the changes politically very scary for National. Without being too dramatic, it is quite possible that National would never have formed a Government since 1993, under the proposed law changes.

• In 1996 a major reasons why NZ First went with National was that National and NZ First could govern with 61 votes, while Labour and NZ First would also need the Alliance and Peters did not want the Alliance having a veto. If National lost that advantage of being able to  solely with NZ First, Peters could well have chosen Labour.
• In 2008, the CR parties would drop from 64 to 58 seats. The Maori Party and NZ First would hold the balance of power. People forget the Maori Party has never ever chosen National over Labour. They have only gone with National in a situation where a Labour-led Government was not possible. In 2008, Helen Clark would have offered a lot to the Maori Party to retain office – arguably more than National could.
• In 2011, it would be like 2008, with the Maori Party holding the balance of power, and they could well choose Labour over National considering they vote with them more often in the House.

So looking backwards, National MPs will be wondering why the hell would they vote for a law change which might have seen 18 years of Labour-led Government. I suspect they see it as a long suicide note.

However they should be careful not to assume the past is the future.

Removing the one electorate threshold only has an impact is a political party can get 1.2% party vote or higher. I have doubts that ACT or United Future can do so, in a sustainable fashion. Mana though is more likely to make 1.2% with non green disaffected lefties defect from Labour. So removing the one electorate threshold may impact the left more.

Likewise on lowering the party vote threshold from 5% to 4%. On the left the Greens look set to stay well above 5% and Mana unlikely to make 4% or 5%. A 4% threshold does make it easier for NZ First to stay on, but they are unlikely to survive long-term once Peters retires or dies. So not that much benefit for the left in 4%.

On the right, National faces an existence without ACT or United Future. The Conservatives got 2.7%. Them making 5% is a hard call, but 4% is more achievable. I hope ACT survives, but if it does not that will leave room on the political spectrum for a new “liberal” party. They would struggle to make 5% but again 4% could be more achievable for them.

So while on past election results the changes would be a disaster for National, they might be beneficial in the future. From a pure self-interest point of view, National should very carefully consider the future as well as the past.

Now personally I support the three recommended changes on the basis of improving MMP, by reducing tactical game playing. But all political parties in Parliament will be looking at them from a viewpoint of “Does it make it more or less likely this will help us form Government”. That is to be expected as you can’t implement the policies that you think are good for New Zealand unless you actually get into Government.

It is clear that the changes would not have been good for National in the past. However in the future I think on balance of probabilities they would be – in the long term.

In the last ballot for members’ bills, Labour had four of the five bills drawn, Greens one and National none. The outcome was rather toxic for National.

National has 35 MPs who are not Ministers (I am assuming even the Speaker could do a members’ bill if he wanted to do so). This is one more than Labour’s 34MPs, so they should have near equal numbers in the ballot.

However in the last ballot just 63 out of 93 eligible MPs had a bill in the ballot. The breakdown is:

• Greens – 14/14 – 100%
• Maori – 1/1 – 100%
• Labour – 33/34 – 97%
• NZ First – 5/8 63%
• National – 10/35 – 29%
• Mana 0/1 – 0%

So you see why Labour is winning the ballot so much – they have more than three times as many bills in the ballot as National, despite one fewer eligible MP.

Interesting that Hone Harawira has no bill in the ballot. This reinforces my view that Hone is a very good politician, but somewhat inept parliamentarian.

Also I wonder who is the sole Labour MP with no bill in the ballot. Did not have time to work it out.

Anyway what can National do to improve its chances in the ballot, and hence reduce the number of bills getting drawn which are Labour and Greens? The simple solution is they need to make it easier for MPs to have their bills approved.

Pretty much all the parties require a caucus to agree to a bill, for it to be submitted by a member of that caucus. So National is not alone in requiring this. However National it seems is extremely risk averse with what it will approve. They think some bills may rouse opposition etc. The problem with such an approach is you have so few bills approved that Labour and Greens win all the ballots, which cause far greater problems for the Government.

National, in my opinion, should be far more permissive in authorising members’ bills by its MPs. There should be a simple ideological test that what is proposed is not inconsistent with National’s principles, and beyond that a fairly liberal approval regime. Backbenchers should be allowed to propose things the Government wouldn’t necessarily want to do (as opposed as be against). You can always water them down at select committee, rather than deny them the light of day at all.

If National doesn’t get more bills into the ballot, the problem will get worse for them. Many opposition bills get rejected at first reading. That means there are few bills needing second and third readings, which means you have ballots more often as more first readings get done. You need some members’ bills which get past first reading, as they slow the overall number of ballots down.

Jane Clifton writes:

Also off-limits to the media was the Saturday night dinner – a great pity, as this saw senior party figures giving what delegates could not stop gushing about as very superior comedy in the course of a fun debate.

The waspish observational humour of Attorney-General Chris Finlayson was the top crowd-pleaser, though delegates were also charmed by a taste of the habitual faux-one-up-manship English and Prime Minister John Key go in for. A senior Young Nat also ventured a killer impersonation of Key. The party members spent the evening happily lampooning one another, more traditional foes like Winston, Labour and the Greens all but forgotten for the evening.

The debate was great fun. The Attorney-General did win the prize for best speaker – for his right of reply speech. What was funny is only half way through the debate did he realise he had to do one! Chris is an incredible debater.

The mimicking of the PM was spot on. That particular Young Nat is very good at doing it.  He gets the mannerisms and tone so well.

The PM and Deputy PM were two of the three Judges, and both made their judging comments at the end. I have to say they were brilliant - arguably funnier than the teams themselves.  It made me wish the debate was being recorded, so they could be on You Tube. It would probably put National up 10% in the polls.

The Westminster Shield is the traditional inter-region debating shield for the National Party. It got revitalized this year after a 20 year or so break, with a North Island and South Island team. The moot was that the South Island should become an independent state – with the North Island team having to argue in favour and the South Island team against.

Many many funny points made – mainly against the rival teams, or in the case of one team – against their own team members. I’d love to blog some of the lines, but its unfair to take them out of the context of a humourous debate and have them on the record.

The contest was very close, but by half a point the South Island team of Nick Smith, Amy Adams and Neil Miller won the 2012 Westminster Shield.

With a degree of regret I can advise that the line which probably got the biggest laugh from the audience was from the Prime Minister when he asked if it was only him, but didn’t David Farrar look like a hobbit size version of Kim Dotcom. Even I had tears of laughter at that one.

The second funniest line of the night involved a reference to “50 shades of grey”. I can’t say more than that, but it was very well chosen (and no this one did not refer to me).

I commented on Twitter yesterday how Sue Bradford complained there were more Police at the National Party conference than protesters. I remarked that I thought this was more a reflection on the protesters than the Police, as not the fault of the Police there were so few protesters.

John Armstrong writes in the NZ Herald:

National’s annual conference was not short of protests. But the protests were embarrassingly short of protesters.

Contrary to the impression given by some accounts, the 400 or so party faithful did not spend their weekend cowering inside Auckland’s SkyCity Convention Centre behind a not-so-thin blue line of police.

The police showed up in significant number; the protesters did not. Yesterday morning’s all-comers rally against everything National stands for drew a total of 79 people – it may well have been counter-productive.

Must have been the weather!

Danyl at Dim Post blogs:

The question is: is this a real ad, or a satire? Seems too extreme to be real – although dawn-raids era National was an overtly racist party. But were they this overt? If this was real wouldn’t it have entered into notoriety, along with the dancing cossacks ad? Wouldn’t we have heard about it before?

On the other hand, the nation was a lot more regional back then. It’s not impossible that this was an ad in a regional publication put out by a rural MP that nobody ever noticed until now.

Anyone who thinks this ever could have been a real National advertisement is somewhat detached from reality. I think it says more about them, and how desperately they’d want it to be true.

Jack Marshall was National Leader in 1972. He was known as Gentleman Jack for a reason – well known for his being non-confrontational and not liking aggressive politics. Marshall also was an opponent of the Springbok Tour, so this little smear campaign poster is very misplaced.

This is very funny. Hat Tip: Dim Post

I’ve blogged before on the Government setting five year targets in a number of areas for both itself and the public service. Not only is this a fairly radical refocusing of the public service from outputs to outcomes, it is politically a brave thing for a Government to do. I can not recall any past Government actually setting concrete targets it wants to be measured against.

Hopefully it will lead to alternate Governments going into an election with not just policies about what they want to do, but actual outcomes they want their Government to achieve if elected. And I don’t mean general ones like “close the gaps” but specific such as “reduce the unemployment rate by 25% in three years”.

The National-led Government has now released specific targets, for its ten five-year goals. The targets are:

1. Reduce the number of people who have been on a working-age benefit for more than 12 months
   1. Reduce those on Jobseeker Support for more than 12 months by 30%, from 78,000 to 55,000
2. Increase participation in early childhood education
   1. By 2016, have 98% of school entrants having participated in early childhood education, up from 95%
3. Increase infant immunisation rates and reduce the incidence of rheumatic fever
   1. 95% of eight months olds to be immunised, up from 83%
   2. reduce the incidence of rheumatic fever by two thirds to 1.4 cases per 100,000
4. Reduce the number of assaults on children
   1. Halt the 10-year increase in child abuse, and reduce the current numbers by 5%
5. Increase the proportion of 18 year olds with NCEA Level 2 or equivalent
   1. Increase the proportion achieving NCEA Level 2 from 67% to 85%
6. Increase the proportion of 25-34 year olds with advanced trade qualifications, diplomas and degrees
   1. Increase the proportion of 25 to 34 year olds having advanced qualifications from 52% to 55%
7. Reduce the rates of total crime, violent crime and youth crime
   1. Reduce the crime rate by 15% – 45,000 fewer crimes a year
   2. Reduce the violent crime rate by 20% – 7,500 fewer violent crimes a year
   3. Reduce the youth crime rate by 5% – 600 fewer young people appearing in court
8. Reduce reoffending
   1. Reduce the reoffending rate by 25%, meaning 600 fewer prisoners and 18,500 fewer victims of crime
9. NZ businesses have a one-stop online shop for all government advice and support
   1. Business costs of dealing with government reduce 25%
   2. KPIs for Government services to be developed
10. NZers can complete transactions with government easily in a digital environment
    1. 70% of transactions with government can be done online, up from 24% currently

Now I don’t think anyone should expect all 14 specific targets to be achieved. That would be a near miracle. But what NZers will be looking for is at least some of them being achieved fully, and all of them to have progress and move in the right direction. The 2014 election will provide an opportunity for people to judge if they think the achievement to date has been satisfactory.

As I said above, I hope these specific outcomes and targets will become a feature of all future governments.

Based on a release from Tony Ryall, a useful guide as to how National and Labour did asset sales. And recall Phil Goff, Annette King and Trevor Mallard vote for the Labour asset sales.

Labour sold a total of 15 assets, so some answers vary by asset sold.

What this shows is that National have acted entirely properly with their partial asset sales, and in fact it was Labour that did everything they accuse National of doing.

Whale Oil blogs that a remit was put to the National Party’s Northern Regional Conference by the Young Nationals:

That the National Party legalise adoption for those who have entered into a civil union partnership.

The remit was passed by the conference and will now be considered for debate at the overall party conference in July.

I’m really pleased that the delegates at the Northern Conference voted in favour of the remit. The outcome reflects well on them and the party.

Trevor Mallard blogs:

Every now and again infighting gets so bad in the Nats that some gems are delivered to me. In this case it is a set of their Board and Board committee minutes.

Except they were “leaked” to numerous people, not just Trevor.  As I understand it they were posted to numerous journalists, and a few MPs.

And as I understand it, there was no leak. Just a theft. One board member never received his board documents in the mail, and it was his copy that got posted to various people. So it looks like someone took them from his letterbox. This is very plausible as his name was on them, and you would never leak documents with your own name on them. So no, there isn’t someone leaking to Trevor. Just a politically motivated theft.

Trevor is very excited by the negative references to Simon Lusk. This is amusing as just a year ago Trevor was insisting that Simon was actually working for Campaign Chair Steven Joyce, and was a loyal National Party servant. Trevor’s theories never seem to worry about consistency.

One item in the leaked minutes which I found interesting was that the Young Nats signed up 715 members on Auckland tertiary campuses over Orientation weeks. That’s a huge achievement.

I’ve blogged previously on the outrageously dishonest spin from Labour that tax revenues are down 4% of GDP over four years, and trying to assert it is all due to the one set of changes in 2010. Even some journalists who should know better have repeated such absurdities.

I’m going to blog in two parts on this issue. The first part will be today looking at what the Treasury macro-economic advice was for the impact of the tax and spending changes, and tomorrow (if I have time otherwise later in the week), I’m actually going to analyse the actual changes in tax revenues through the 2008 BEFU, the 2008 PREFU, 2008 DEFU, 2009 BEFU, 2009 HYEFU, 2010 BEFU, 2010 HYEFU, 2011 BEFU, and finally the 2011 PREFU. This looks at the changes in overall tax revenues, individual tax revenues, corporate tax revenues and GST.

It is important to understand you need both the forecasts of what a change will do, and what actually happened. Neither are the total picture, but together they give us a reasonable picture.

You see the reality is that if Treasury says (for example) hiking the top tax rate from 33c to 39c will bring in $900m/year of extra revenue, and a Government does it, and revenue only goes up $700m, then no-one really knows why the revenue gain was less than projected. It might be that it did increase revenue by $900m, but that economic growth was flatter and so taxable income was lower. Or it could be that the increase lead to greater tax avoidance, and the increase did not achieve as much extra revenue as projected.

It is easy to diss Treasury projections – even I have done so. But it is worth noting how massively complicated it is to forecast tax tax over an entire economy. Many individual companies have problems forecasting income just for that company. Now imagine having to forecast income for the aggregate of every company and person in New Zealand, without having the knowledge of what is happening in individual companies.

What we have below is the official net fiscal impact as forecast by Treasury for National’s tax and spending changes. As you will see the total effect of these tax changes is negative during the 2008 – 2010 period, which is when there was a fiscal stimulus policy to help cushion the recession, and in the first two years, providing support to the economy during the recession, and have been net positive from 2010 onwards.

Net fiscal impact of the Government’s tax changes ($million increase (decrease) in the operating balance)

 1. fiscal impact = revenue (2/3*removal of R&D tax credit + KiwiSaver changes + cancelling remaining tranches of Labour’s tax cuts) minus costs (personal tax + IETC). Source: Cabinet Paper CAB(08)585.

2. cancellation of the 2010 and 2011 tax cuts as announced in the 2009 Budget. Source: Treasury Report T2009/418.

3. SME tax package as announced in February 2009. Source: BEFU 2009, Table 1.7.

4. fiscal impact = revenue (GST increase + depreciation + LAQC + thin cap + WFF + GST base + tobacco + increased audit) minus costs (personal tax + company + PIE and savings vehicles + GST compensation). Source: Budget 2010 Executive Summary, Table 1.

5. savings from changes to KiwiSaver and WFF tax credits. Source: Budget 2011 Executive Summary, Table 2.

It is worth recalling that during this period Labour opposed every single spending cut made by National.

Over the six years of National’s first two terms, the total projected impact of National’s tax changes (and cancellation of spending commitments) has been a net improvement of $4.9b. In other words compared to the policies put in place by Labour in 2008, National’s changes were projected by Treasury to result in $4.9b more revenue over two terms.

It is worth noting these are only the direct tax (and cancelled spending commitments) changes. This is not taking into account National slashing to the contingency for new spending from over $2b a year to $800m and eventually zero. That has also had am impact in the billions.

Now as I said, we will also look tomorrow at what actually happened to tax revenues, but many factors impact tax revenues as well as policy changes. These figures for now show how preposterous Labour’s deception is about how the 2010 tax package is somehow primarily or totally responsible for a decline in tax revenue of 4% of GDP or $7b/year.