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Insights 26: 20 July 2018
LGNZ and The New Zealand Initiative start Project Localism
Upcoming Wellington event: Philippe Legrain on how our open world is under threat
Latest interview: Dr Oliver Hartwich on Trump shocking European allies

Project Localism
Dr Oliver Hartwich | Executive Director |
For six years, the Initiative has been arguing the case for localism. Pointing out that New Zealand is one of the most centralised countries in the world, we have called for a radical shift of political and fiscal power from the centre to communities.

When we started our campaign for localism, it was a fringe idea. At best, people thought it was unrealistic. At worst, they thought we were crazy to propose giving more power and money to councils.

But the more we have explained our case, the more people understood this is not what it is about. Localism is not about having a bigger or a more taxing government. It is all about shifting government decision-making closer to the people affected by it – to make it local. Hence the name.

On Sunday, we reached a milestone. With Local Government New Zealand, the Initiative launched Project Localism. Over the next eighteen months, LGNZ and the Initiative will investigate how a recalibration of government can be achieved.

We will consult with experts and stakeholders from government, business and academia. We will hold public events and ask for submissions. We will engage widely to get the best ideas for better government.

We are pleased that the Government has also announced an inquiry which will happen in parallel to ours. Minister of Finance Grant Robertson has tasked the Productivity Commission with a comprehensive study into the operations, finance and funding of local government.

The two inquiries have the potential to cross-fertilise each other. From the Minister’s announcement we can already see a good degree of common ground and overlap. This is positive because New Zealand’s broken centralism will require a lot of work to sort out.

The political feedback on our inquiry has been encouraging. Acting Prime Minister Winston Peters said that he understood the problems facing local government and was open to ideas.

Opposition leader Simon Bridges also welcomed our initiative by pointing out that better incentives for a more competitive local government sector would be a positive development.

With such cross-party openness to our Project Localism, and with the Productivity Commission also on the case, we hope that we will make progress on moving towards better local government over the coming years. The chances for decentralisation have never been better.

European time warps
Dr Eric Crampton | Chief Economist |
It’s astounding. Time seems to be repeating. European madness takes its toll.

Two decades ago, the European Commission (EC) worried that Microsoft was abusing its dominant position. Microsoft’s operating system was the way most people interacted with computers, and the operating system came bundled with a media player and an internet browser. The EC reckoned that Microsoft was exploiting its dominant position in the operating system market to lock up other markets.

And so, late in 2004, it required Microsoft to offer European versions of Windows that did not include a media player. Five years later, it required Microsoft to offer users choices among internet browsers when installing Windows so Internet Explorer would not be privileged by Windows’ dominant position.

It was always ludicrous. Installing alternative media players, or browsers, was and is trivially easy. Microsoft’s dominance was driven by its superior products. In areas where Microsoft’s products lagged, Windows’ dominance provided it with no advantage. A typo in Internet Explorer’s URL bar would lead the user to an MSN Search window, but Google provided the better search engine and users chose it despite the Commission’s contrived arguments about consumer lock-in.

Early last year, Google’s Android overtook Microsoft Windows as the most popular way of getting to the internet. The EC decided this week, in a bit of a mind flip back into the 2000s, that it should be harder for Android users to access Google services like Google search. It fined Google €4.34 billion, or just under NZD$7.5 billion.

The EC’s complaint is at least as ludicrous as its 2000s worries about Internet Explorer. It was as simple for me to install Firefox in the early 2000s on my Windows machine as it is for me to install DuckDuckGo on my Android phone today. Google’s search dominance depends on keeping ahead of its competitors.

And while the EC sees anticompetitive purpose in Google requiring that manufacturers build from its version of Android, the better explanation is that apps available in Google’s Play store might not work well on alternative versions.

New Zealand is on the sidelines of this dispute but does have a stake. Kiwi app developers may have to look forward to coding for compatibility with a bevy of Android variants. And if Google has to fund Android development through licensing fees rather than bundled search tools, we can expect higher phone prices.

I hate doing this time warp again.

Creatures of habit
Joel Hernandez | Policy Analyst |
People have always said, we are creatures of habit.

Every day we wake up at the same time, have the same breakfast, go to the same workplace, eat out at the same restaurants and order the same meals.

We are so predictable that our smartphones can even alert us when to leave for work and when to head to the restaurant for dinner without us setting any notifications. Thanks Google.

This predictability has recently been studied by researchers from the Technical University of Denmark. The authors’ key findings are that the average individual only travels to a maximum of 25 locations regularly over several months and years.

That is, once an individual finds new locations to regularly visit (i.e. your 24th and 25th locations), other previously frequented locations drop off. Think of a new bar or restaurant that becomes your new ‘go to’ for catch-ups with friends.

This got me thinking about the 25 places I and other Wellingtonians like to visit on a regular basis.

The top 5 locations are easy. I start my day at home, catch the same train to Wellington Station, take the same elevator up to the Initiative’s office in the Bayleys building, walk the same path to the Stats NZ data lab, and go to the same nearby Mojo café to start my day with a flat white.

Lunch locations are easy too. Tommy Millions, New World and Lambton Square Eatery are always a top pick for me and local civil servants working in the CBD.  

Evenings are predictable for most Wellingtonians too, me included. Gym classes at 5:30 are always packed, so are local bars and restaurants at 7. I can count all my favourite restaurants on one hand quite easily, can you?

Like many other Wellington young professionals, I like to start my weekend with brunch. Cuba Street cafés are great for coffee and chit chat after a ride or run around the bays. While Maranui Café and Spruce Goose are perfect for family lunch or dinner.

If you’re anything like me you love the 25 places you go to for food, friends and family.

What are my recommendations?

My only recommendation is that you don’t try and take a Wellington bus, because you may never reach any of your top 25 destinations in the first place!

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