The Economic Consequences of Luxon's Announcement of not wanting to govern with Te Pāti Māori
- rmacculloch
- May 10, 2023
- 2 min read
Today the Leader of the National Party ruled out coming to any arrangement with Te Pāti Māori in forming a National-led government after the 2023 election. Sir John Key did form a coalition with the Māori Party, together with ACT. This blog is focused mostly on economic matters - of course there are political reasons for Luxon's announcement linked to winning the next election - but our focus is on how it could affect our economic future.
Many pro-market beliefs & policies, like Charter Schools, are embraced by Māori, and have been strengthened by the rise of the Māori economy, yet are opposed by Labour / Greens. The PM has a personal dislike of Charters. More private provision, including of education & health-care, is of rising interest to Māori, who have more capability than ever to play key roles as competitive suppliers. Yet anything to do with privatization is opposed by Labour / Greens, which both promote State dependence & control. Both those parties are covering up how their fundamental economic ideologies will forever frustrate Māori aims.
So any marriage between Labour, Māori and Greens will always be dysfunctional. It's a pity when Māori long-term economic prosperity depends on beliefs & values inconsistent with present Labour / Green economic policy, but more in line with National / ACT, that arguments about issues like co-governance have gotten in the way. Te Pāti Māori must figure it has more to gain in the short-run being part of a Labour / Green coalition due to gains from redistributions of wealth & power than from reforms that would improve the efficiency of the Māori (and entire Kiwi) economy. For Election 2023, we now have three aligned parties sharing one thing in common - a burning desire for redistribution.
Should NZ vote for a Labour-Green-Te Pāti Māori coalition, here's just one example of the conflicts that will arise: Labour-Greens will want capital taxes, yet our Treasury states, were these to be implemented, "Specific consideration would need to be given to the treatment of Māori freehold land & iwi assets" (p. 76, NZ's Long Term Fiscal Position below). Which I guess means such assets would be exempt.
How can such issues ever be resolved?
Sources: