Diverting the Public's Attention
This government is stuffed. Taxidermists and sycophants will continue to put
a smiley face on it, and the National Opposition could yet resurrect it, but
Labour looks dead in the water. It's not just that the cabinet is shambolic
with weak ministers (including Michael Cullen) in trouble, and little
backbench talent to replace them. The election margin was so fine, and the
ultimate coalition outcome so unpredictable, that anything could happen, any
time. Behind it all is the mad MMP system, proving beyond doubt that when
election numbers are tight, the economy is receding, and decisive action is
required, it can't be done. Inevitably, the public is looking for someone to
blame. Ministers are determined the spotlight won't fall on them. Having
failed when they had the numbers to implement tax and regulatory reforms
that experts advised would grow the economy longer term, they are now
diverting attention from their mismanagement. As they trawl through reports
from focus groups and internal polling, they are looking for anything that
might sidetrack voters. No ministers put New Zealand first; just themselves.
Several recent circuses staged by the ministry illustrate the point.
Micro-chipping dogs won't even begin to deal with savage beasts owned by
ferals who don't register them. Tackling that problem would require a major
effort rounding up and putting down uncared-for dogs, and probably stir an
outcry. Instead, micro-chipping is designed to convey the impression of
action when sensible people know it will achieve nothing. The beat up on the
new sharemarket darling, Rakon, is another diversion. A shock-horror story
suggested that Rakon was hand in glove with American military might.
Ministers couldn't believe their luck. Time to trot out peace agendas, dust
off anti-nuclear credentials and sprinkle the media with a bit of
anti-Americanism, just as they had done a few weeks earlier in support of
some careless remarks from their hand-picked, and now largely invisible,
Minister of Foreign Affairs. Anything goes these days. No matter that Helen
Clark was telling us last year she wanted to progress a free trade deal with
the Americans. Given a chance to label Don Brash pro-American (a shocking
crime in this government's eyes) the country's trade prospects became
expendable. Labour's new line on Brash, that he is unpatriotic because he
points out that New Zealand's talents are bleeding to Australia at a faster
rate, is another distraction. It shifts attention from Cullen's lack-lustre
budget. Aren't journalists taught about political smoke screens?
The granddaddy of recent diversions is the unbundling of Telecom's lines.
Leave aside the leak, David Cunliffe's untoward remarks about dividends, and
Telecom's own clumsy handling of the issue. As economist Bryce Wilkinson
demonstrated in the National Business Review, ministers still haven't
produced any compelling case that unbundling will produce any net public
benefit. There may be such a case. But it hasn't surfaced, and it's clear
ministers didn't possess one when they decided to unbundle. Indeed, the
leaked cabinet paper makes it clear that no official cost-benefit analysis
was done. The government's hand-picked Telecommunications Commissioner
recommended against unbundling. All that ministers had to guide them when
they decided to go ahead was a hunch that it might expand Broadband
coverage. Has this country reached such a parlous state that a cabinet wipes
more than $2 billion off the value of our biggest company on mere guesswork?
Where they kill off a major slice of peoples' retirement funds or pension
investments on a whim? God help us!
As I say, we haven't yet seen the case for unbundling. The reasons advanced,
and the methods used, have been so unconvincing, even cack-handed, that they
beggar belief. One has to assume that the government had another agenda. I
suspect it's all about politics. It is designed to scythe off a corporate
tall poppy that has little support amongst Labour's focus groups. Attacking
Telecom appeals to the envious and the ignorant, and above all, diverts
attention from the things ministers now realise they should have done years
ago. Sadly, the worst consequence of all is that potential overseas
investors will look at New Zealand's economically illiterate cabinet
destroying property rights without adequate explanation, let alone
compensation, and invest elsewhere.
Regulation, alas, is like crime: once one gets away with it, there's a
temptation to try more. The private sector that creates 70% of all jobs
should now be very scared. An even less business friendly government than
Robert Muldoon's has blood in its nostrils.