Saturday, May 18, 2013

Karl du Fresne: The elimination of poverty will just have to wait

The team of Key and English may go down as one of the more effective political partnerships of modern times. John Key is the schmoozer, the salesman. His incorrigibly sunny disposition infuriates a lot of people, who see it as smarmy and ingratiating. But it’s hard to argue with his poll ratings, which have held up extraordinarily well after one and a half terms during which the government has had to grapple with one crisis after another.
With the passage of time, Mr Key has also demonstrated an increasing command of policy detail, something that eluded him in the early days of his prime ministership.

Bill English is the dour Southlander doing the hard graft behind the scenes. While Captain Key is up on the bridge waving reassuringly to the passengers, chief engineer English is down below shovelling coal into the boilers.

He’s not as relaxed in the public eye and lacks his boss’s charisma. He had an unhappy time as National leader (the party suffered its worst-ever electoral defeat on his watch), but seems to have found his niche as Minister of Finance.

History may view him as a safe pair of hands – to use a classically understated New Zealand compliment – during a turbulent period that called for steady nerves.

While media attention was focused on political scrub fires – the Dotcom saga, the GCSB, Novopay, the whiffy Sky City deal, Mighty River Power – New Zealand has quietly been winning international regard for the way it has weathered the global financial crisis.

Only this week, both the International Monetary Fund and credit ratings agency Standard and Poor’s endorsed the government’s economic approach. S and P places us among the world’s 10 least risky economies.

There’s definitely a sense that we’ve turned the corner. Economic growth is gathering speed and unemployment is starting to fall. It seems ironic that this should happen just as Australia, which seemed to sail through the GFC almost unscathed, is being battered by severe head winds.

The great migration across the ditch (which National promised to halt, but didn’t) may soon start to reverse itself as the Lucky Country battens down the hatches.

* * *

Of course the economic purists will find much to complain about in the Budget. Voter bribes such as interest-free student loans and Working for Families, introduced by Labour, remain in place.

These are a continuing affront to people who insist that a centre-right party should have no truck with such policies. The arguments here are uncannily similar to those in Britain, where the Conservative Party is locked into a coalition government with the Liberal Democrats and finds itself shackled by policies that run counter to classic principles of economic liberalism.

National abandoned ideological purity decades ago, recognising that it was no way to win elections. Keith Holyoake created the pragmatist legacy of which Mr Key is the perfect inheritor. The Key formula is to do whatever works and whatever wins elections.

It’s a style of politics that the late Margaret Thatcher, the ultimate conviction politician, had no time for. But in the MMP era, when compromise and deal-making are the keys to political survival, the purists just have to learn to live with it.

* * *

As always in the days leading up to the Budget, a parade of professional supplicants shuffled forward this week with begging bowls extended.

All the usual suspects lined up in the media, demanding that the government throw more money at the worthy causes du jour. One modest goal urged on the government was the elimination of poverty – surely something any finance minister with a social conscience should be able to achieve at a stroke.

Other items on the wish list included thousands more state houses, breakfasts for starving schoolchildren and free bariatric surgery, which the medical profession tells us is essential if we’re to avoid a “tsunami” of obesity-induced diabetes.

On Radio New Zealand’s Morning Report, I heard one advocate for the poor saying it wasn’t enough to provide free breakfasts for kids from decile 1 and 2 schools. The government had a responsibility, he pronounced, to feed all schoolchildren.

On the same programme a housing activist, while grudgingly conceding that the government was on the right track by increasing housing capacity, made it clear that whatever was announced in the Budget would be hopelessly inadequate.

Most striking, as usual, was what went unmentioned.

No one thought to say where the money would come from. Too difficult. Perhaps they think it’s magically conjured out of the air rather than generated by taxpayers, which first requires a prosperous economy.

And no one made any reference to where individual responsibility – as in making sure children are fed before going to school, or saying no to that extra litre of ice cream – sits in their view of the perfect world.  

Karl blogs at This article was first published in The Dominion Post, May 17.

1 comment:

Anonymous said...

I guess English's assertion that freeing up land would close the inequality gap got past your nose Karl?