Ashley Bloomfield's no-evidence-of-left-or-right-in-our-civil-service doesn't apply to economics

Former Director-General of Health, Ashley Bloomfield, said today, regards Rob Campbell's partisan comments about the National Party's position on "Three Waters", that:

"I spent much of the last 25 years in NZ’s excellent public service & saw no evidence of either left or right ‘leaning’. I have no idea how any of my former Crown Entity colleagues voted, we just didn’t talk about it. Rob Campbell’s comments are a big story because it’s a very rare event".

Gosh, he can't be referring to that part of the public service engaged in implementing economic policies. It's hard to know where to start regards the politically charged appointments that Labour has influenced throughout our civil service these past years, including ones who have made overtly partisan comments even when in office. It's not big news in my circles since it's so common.

Let's start with the Chair of the Board of the Productivity Commission, economist Ganesh Nana, who works in similar fields to me. Here is the headline that Stuff ran in June of last year during an interview after Nana was appointed:

"Rogernomics? Not on the watch of Ganesh Nana, new head of the Productivity Commission". On Rogernomics, “we got sold a lemon”, Nana declared.

Is the Productivity Commission Chair's line about Sir Roger Douglas, Minister of Finance 1984-88, being a used-car-salesman-trickster who sold unsuspecting Kiwis a "lemon" (the name for a dud car) before starting the ACT Party with fellow lemon-seller Richard Prebble, "evidence" of his "leaning"? Well, at least one thing is sure, he ain't voting ACT.

Does the fact PM Hipkins also slammed Rogernomics in his maiden speech in Parliament make it ok for the Productivity Commission Chair to have violated political neutrality in this particular way? Is there one rule for Chairs of some Crown Entities and another for others?

The NZ Productivity Commission - Te Kōmihana Whai Hua o Aotearoa describes itself as an "independent Crown Entity". Independent my foot.

Sources:

https://www.nzherald.co.nz/nz/politics/ashley-bloomfield-weighs-in-on-rob-campbell-sacking/2HN2IXMJKFHEDBSOTIS2JEYPCA/

https://www.stuff.co.nz/business/300333582/rogernomics-not-on-the-watch-of-ganesh-nana-new-head-of-the-productivity-commission

Our Great Economic Blame Game

The Herald ran my critique of National's Five Point Plan for our economy - and then turned around and rejected the one I wrote about Labour to balance the debate. Here's a slightly condensed version of the rejected one for the Blog:

Prime Minister Chris Hipkins blames those in power 40 years ago for NZ's more recent woes. It was the Rogernomics reforms of the 1980s that saw the creation of "huge divides", he said in his maiden speech in Parliament.

“We live with the legacy of that action today”, he proclaimed. “As a society, we became indifferent to the lives of those around us. We see that indifference to others in the terrible growth in violent crime …”

Facts speak otherwise. In 2017, before Ardern became PM and Hipkins Education Minister, our nation ranked second in the world in terms of “social capital”, using the respected Legatum Prosperity Index. It measures how much people “trust and support each other”.

During Hipkins’ own time in power the past five years, our social capital ranking fell. It seems that people only became indifferent once he came to power.

Can we instead find reasons for our eroding living standards without blaming current and previous governments?

The answer looks like a “yes” once we consider the three drivers of long-term economic growth: institutions, trade and geography. Let's look at each in turn.

One of the most important drivers of prosperity over time is the quality of rules related to ownership, control and governance. Yet our institutions are now beset with uncertainty, much of it due to disputes regarding the nature of property rights over strategic national assets, like water.

Wherever in the world this has occurred, sustained prosperity for all citizens has evaporated.

The second driver of long-term prosperity is trade. However, protectionism is on the rise. US steel workers led it, hurt by cheap imports. Immigration fears also abound. They stoked Britain's exit from the European Union.

In this country, the carbon footprint of farmers, as well as tourists, many of whom arrive on long-haul flights and cruise ships, is now scorned. Those two groups make up our two biggest export earners. Meanwhile, health experts say there’s potential for dangerous new virus strains to emerge, which could require border closures again.

One may argue that the loss of support for freer flows of goods, people and capital between nations affects everyone in the world, but we've been particularly dependent on these flows.

The third driver of long-run prosperity is geography. Yet most of our top school leavers now prefer to continue their studies abroad. This has never happened before at such young ages and in such large numbers. The ones I know say they're not leaving to one day return and save our country, but because they're giving up on it. They're voting not at the ballot box, but with their feet.

Where does this leave us? Our institutions, trade and geography, the three drivers of long-run growth, are wobbling from seismic tremors. The causes have nothing to do with the legacy of Rogernomics, which Chris Hipkins blames.

The reforms back in the 1980s addressed this nation’s low productivity, which had put up our cost of living, meaning “higher prices for everyday items” and “a larger burden on those with low incomes”, to quote the Productivity Commission.

Our PM has had 25 years, ever since he was a student at Victoria University, to devise his own solution to fix this very same problem that has come back to haunt us today. We're still waiting for an answer.