Need Money, not only is it a crude measurement, but if Chris Martenson's analysis, called Fuzzy Numbers, is to be believed, the US's official figures are now so manipulated as to be almost meaningless.

None of the market reforms worked....an indictment of Rogernomics if ever there was one...

steven

You don't sound old enough to remember pre RD how NZ was but i can tell you you would not be playing on your PS3 without him

Neven

I agree with Kohler and the OECD - the reforms genrally did not work.

Take the RMA 1991, a classic product of the reformist era - indeed according to Simon Upton, never in the history of government reform had so many other pieces of legislation been repealed, nor so much been analysed and written about the subsequent re-shaping of the new legislative and accountability environment.

The basic idea was to allow for an 'anything goes' approach to natural and physical resource management provided a development/resource use proposal could demonstrate its ability to avoid, remedy or mitigate adverse effects ('externalities') on the environment. In short - the objective was to get away from what was considered a prescriptive regime (the Town and Country Planning Act) and into one which rewarded entreprenurialism and innovation by private sector landowners.

What have been the results? Environmental degradation accellerated on most indicator accounts, infrastructure expenditure and maintance on 'core' service areas by local authorities declined, monitoring and enforcement took a back seat to "place shaping" strategic exercises, the cost and timeframe to development increased, biodiversity suffered serious blows as plant and animal pest control became fragmented. and the list goes on and on.

Then there is telecommunications reform - where BellSouth was held up for years in terms of establishing a second cellular network - and the total cockup with respect to number portability.

Then there were the electricity reforms .... need I go on?

About all that 'worked' from that period is that we were able to reduced our current account deficit through asset sales, albeit at fire sale prices, and to in many cases (Faye Richwhite for example) unscrupulus business interests.

Bullitt -only read what was reported of the OECD report. I didn't see any reference to specific legislative Acts. And the Kohler report states;

"The OECD report pitilessly reveals New Zealand's woes: apart from the vulnerability to external shocks because of the current account deficits, now at 8.9 per cent of GDP, the policy reforms of 1980s and 1990s have completely failed, leaving NZ productivity and standard of living near the bottom of the OECD tables."

All the legislative reforms I've mentioned above are from the 1980 and 1990s. (Although I think Shipley had rolled Bolger by the time Bradford had his way with the eletricity sector).

The reforms didn't work, that is a fact. Why is another matter and moving forward with some sensible 'how2s' is yet another. Some of you in this thread will have seen reasons I've shared elsewhere, for those that haven't have a look at this:

http://www.interest.co.nz/ratesblog/index.php/2009/04/15/opinion-how-tou...

and in particular have look at the book review I completed (and linked to) for John Kay's book, where he uses Argentina and NZ as examples of countries once rich, but now becoming poor. It's a shame it so obvious to external observers and yet our policy makers over a longer period of time, have not been able to deliver suitable solutions. In fact, don't skimp with just my review, read John Kay's book, it's well worth it. Plus try Bryan Gould's recent effort, "Rescuing the New Zealand Economy: What Went Wrong and What We Can Do to Fix It"

It's about grasping nettles, not kicking political footballs around continuously - and continuously getting no where.

The other book I refer to in that link above is The Origin of Wealth - Evolution, Complexity, and the Radical Remaking of Economics, by Eric Beinhocker, and regarding Bryan Goulds point:

"It is only the ideology* of the "free market" fanatics that prevents us from taking these sensible steps."

Beinhocker aires a balanced view having shown that the opposite; controlled, centrally planned markets are just as stifling, where he does a useful chapter called "˜Politics and Policy "“ The End of Left versus Right' that includes a very interesting section entitled "˜Left-wing Utopias and Free Market Fantasies'. [Repeating from elsewhere now] "It's not a promotion of Tony Blair's "˜The Third Way' and therefore not simply about profit fuelled socialism and gravitation toward centre politics in the first world. From a complexity point of view, the critique of the left is quite obvious "“ you cannot centrally plan evolution. (Unless your name is God perhaps!) For the right, free markets are not as free, fair and efficient as theory predicts and so dogmatic assertions of "˜leave it to the markets' are as flawed as central planning. Rather the role of the state is to create an institutional framework that supports the evolutionary mechanisms that underpin markets, striking a balance between cooperation and competition while best shaping their character to serve the needs of society."

The question is, how do we get politicians to recoginse that entrenchment in either idealogue* does not seem to be working? Not least of all in NZ. But then make policy that leads to sustainable growth - all while possibly hampered by the combined effects of a unicameral legislature with a seemingly less than effective select committee mechanism, a 3 three electoral cycle dominated by the need to maintain a status quo for the sake of coalition unity under MMP and where most significant debate only seems happen in the electoral campaign - which in the main tend to be 'tax break promise wars' - all while major structural issues with our economy continue to go unaddressed - at least that seems to be the evidence to date.

If it's not these issues, aggregated causes, what is it?

* I think it needs to be recognised if Roger Douglas had not done what he did when he did, NZ would have probably been a real basket case. Sure, there may have been a better way, but it seems to me speed was of the essence as much as functionality. However, once past the remedy stage and before the apparent collective traumatisation of NZ society - what was required?

What still is required - that might work in NZ's context, now?

Kate - point taken. To my mind, while speed may well have been required, it was the depth of change coupled with the degree of speed and lack of damping associated with say an effective bi-cameral legislature that has led to poor outcomes and trauma of the NZ pysche, which has then led to the introduction of MMP and pendulum swinging tinkering ever since.

Note 19 to chapter 5 in John Kay's book, page 59, where he comments on the reforms and demise of NZ's growth, did not escape my attention:

"There is extensive literature on the New Zealand reforms. Almost all of it congratulatory in tone; the congratulations refer to the fact that the reforms have happened. See for example Evans et al (1996), which is a careful survey of the program, but then derives lessons from the "success" of the reforms without substansive discussion of the effects. Douglas et al (2002) is similar. It is presumably self-evident that the results will be beneficial, and therefore there is no need to enquire into the consequences. This is a feature of much commentary on the American Busness Model."

But how far do we have to sink before the need for effective change in policy actually happens?

Kate : there is a school of thought that Helen Clark's social democracy was to have a permanent Labour government, ruling in conjunction with a plethora of minor allies. From one election to the next only small changes in the mix of minor parties would occur. Here may be where she feels so betrayed by us, the voters, because we could not see her grand design as a wholesome, egalitarian, and sustainable way forward.

A quick look at comparable political systems in Europe and Scandinavia reveals entrenched unemployment (permanently over 10%, prior to the credit crunch recession), massive government bureaucracies and heavy taxation, bolshie and powerful union movements, enemic GDP growth, and low entrepreneurship and capital investment.............Imagine that Queen Helen wished all of this for us !

Kate

Tony Blair had what Helen Clark didn't Oil, Its all very well being a feminist fist in a velvet glove with cohorts of guilt ridden effetes by your side but the rest of us live in the real world.

Having said that even with Oil it doesn't seem politicos can get it right, look to the crashes that will occur in the US, Mexico and UK in the next few years and the common theme....the oil runs out (local and empire)

Neven

Kate - correct, and thanks.

Input on - alternatives to the idealogies, defining the problem, recognition of the type/s of problem/s we have, limitations in terms of context, appreciation of what has and can work and most of all practical business focused 'how2' style policy suggestions - and without continually excusing ourselves for something better with the distance and size facts - it seems to be just a pacifier politicians are continually willing to rely on to dampen our ambitions and not question the status quo too thoughtfully.

However, I'm beginning to think this isn't the right kind of website for that and that it may just reflect what seems most important to most in New Zealand - maintenance of the status quo for the benefit of asset/property holders. It's been interesting from that point of view, sure, but experiencing many discussions gravitating to housing affordability, etc does says as much perhaps as the absence of more critical (and practical) input for ideas sustainable economic development.

Cheers, Les.

Les and PostD - you've got it right about maintenance of the status quo!

And you will both appreciate this quote from Thomas Kuhn, philosopher of science (PhD in physics) who brought the notion of "paradigm shift" into being with his thesis on "The Structure of Scientific Revolutions".

He noted that;

Paradigm change is closely aligned to perceptual change and "novelty emerges with difficulty, manifested by resistance, against a background provided by expectation".

The good news is that this economic crisis has indeed created that environment of tension which Kuhn speaks of - so I do have hope that as people's perceptions change (and this type of accessable public forum s a great conduit to precipitate changing perceptions), that we will see paradigmatic change in the way the world (and NZ) organises its affairs.

That chart doesn't really surprise me much, we just seem to be heading towards being more of a consumer country all the time, without the extra earnings to make up for it.
Shopping is becoming too much of a national pastime.

I wonder if GST was a bad thing, all it did was make the government want people to spend more on junk, so they could get more revenue, so any government isn't going to do anything to discourage consumerism with GST around.

I hate craigslist cause its so hard to find things, but I found this craigs list alternative: squibers.com that lets me view things by pictures its SO much easier to use and they have everything craigslist has plus more. craigslist alternative squibers