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Insights 34: 11 September 2020
TVNZ Breakfast: Civics knowledge in New Zealand is poor says Eric Crampton
 
Podcast: Eric Crampton on the paradox of democracy
 
Report: Democracy in the Dark

Letís keep hoping
Dr Oliver Hartwich | Executive Director | oliver.hartwich@nzinitiative.org.nz
Labour finally announced some election policies this week: a new public holiday, a cap on bank fees and a new top rate of income tax.

It is easy to point out what all these measures have in common. They are popular with the wider public. They do not cost the government anything – and one will even create a bit of extra revenue. And they are small fry.

Agree with these measures or not, no one would call them ambitious, visionary or transformational. People do not go into politics to abolish PayWave fees, and voters would not rally for such causes either.

The contrast between these gimmicks and Labour’s 2017 campaign is stark. When Labour then said “Let’s do this,” it talked about big-ticket items. It promised 100,000 new affordable homes. It wanted to connect Auckland Airport to the CBD with light rail. It also pledged to abolish child poverty and make rivers swimmable.

The Government sworn in three years ago did not just aspire to do a decent job. It wanted to be “transformational” and “the most open and transparent Government.”

Fast forward to today and some of those key promises remain unfulfilled. KiwiBuild is now synonymous with a policy disaster. Most child poverty measures have deteriorated. And the Auckland Airport connection was abandoned.

To avoid reminding voters of such failures, Labour’s 2020 election campaign is emphatically modest in its promises. Even the announcement to bring the 100% renewable electricity target forward by five years contains an opt-out clause via an interim review date. Not that it made economic or environmental sense in the first place.

Labour can afford to be vague. Its polling is so high, it need not promise much to be re-elected – potentially even with an outright majority.

However, Kiwis need a clear vision for their future.

Even before the Covid-19 crisis, the country faced severe challenges. New Zealand’s education system is mediocre by OECD standards and falling in every international ranking of student success. The country has a terribly unaffordable housing market and its productivity is in the doldrums.

Covid-19 made all this much worse. New Zealand’s monetary policy has joined the global madness of zero interest rates and money printing. Public debt is rising at an alarming rate. And the only reason many are still working is thanks to the wage subsidy scheme.

To deal with these boiling problems requires a different approach to policymaking – one based on sound economics, not just opinion polls.

New Zealand needs a transformational Government. Let’s keep hoping.

Shedding some light on democracy
Nathan Smith | Chief Editor | nathan.smith@nzinitiative.org.nz
Back in April, the Government promised $50 million to support a flagging media sector. It’s hard to make a buck online, but the real problem was getting people to pay attention to news.

It turns out New Zealand’s entire democratic system faces the same problem. The good news is that fixing both the media and upping the level of civics knowledge can be solved with one policy change.

As The New Zealand Initiative shows in its new report, Democracy in the Dark, Kiwis struggle to answer basic civics questions. With a general election around the corner, it is sobering to read how little is known about the country’s cherished institutions.

But with a bit of perpendicular thinking, voters could be incentivised to follow what goes on in Wellington.

The report is sceptical of whether more civics education at school would help. After all, how much of third form calculus does an adult remember? But $50m is a hefty sum no matter how good one is at maths. It’s an arbitrary figure, of course, but it helps frame the real problem: incentives.

What if Elections New Zealand paired $50m with a randomly dialled call to a New Zealand phone number? It would ask one or two questions to the person on the other end of the line about the week’s news headlines or queries from a set of basic civics questions.

The agency would continue dialling numbers until someone answers correctly. That person would win $10,000, immediately.

Now we have your attention.

The base annual cost of this scheme would be about $3.65m. Of course, a team would need to be hired as well, among other administrative costs. But even if the scheme reaches $4m per annum, the Government could run it for 12 years on a stipend of $50m. A bargain!

Little else would need to change because the media already covers key political and civic stories as part of its role. And if the potential prize for following the latest news could buy a diligent Kiwi a second car, they might calculate that a subscription to the NZ Herald or the NBR is worth it.

And just like that, fresh thinking solves two critical problems: boosting civics knowledge and return people’s attention to important journalism. Chances are it would also encourage newspapers to stop writing cat stories, too.

That’s the thing about incentives: you just have to ask the right question.

You can read Democracy in the Dark here.

The twelve days of election bribes
Luke Redward | Research Intern | luke.redward@nzinitiative.org.nz
On the first day of election bribes, Jacinda gave to me: a holiday on Matariki.
 
On the second day of election bribes, Judith gave to me: two four-lane highways and a holiday on Matariki.
 
On the third day of election bribes, Shane gave to me: three billion trees, two four-lane highways, and a holiday on Matariki.
 
On the fourth day of election bribes, David gave to me: four semi-auto rifles, three billion trees, two four-lane highways, and a holiday on Matariki.
 
On the fifth day of election bribes, Marama gave to me: reforming ACC, four semi-auto rifles, three billion trees, two four-lane highways and a holiday on Matariki.
 
On the sixth day of election bribes, Grant gave to me: six nationalised SOEs, reforming ACC, four semi-auto rifles, three billion trees, two four-lane highways and a holiday on Matariki.
 
On the seventh day of election bribes, Paul Goldsmith gave to me: seven baby bonuses, six nationalised SOEs, reforming ACC, four semi-auto rifles, three billion trees, two four-lane highways and a holiday on Matariki.
 
On the eighth day of election bribes, James gave to me: eight private school handouts, seven baby bonuses, six nationalised SOEs, reforming ACC, four semi-auto rifles, three billion trees, two four-lane highways, and a holiday on Matariki.
 
On the ninth day of election bribes, Jami-Lee gave to me: nine screaming conspiracists, eight private school handouts, seven baby bonuses, six nationalised SOEs, reforming ACC, four semi-auto rifles, three billion trees, two four-lane highways and a holiday on Matariki.
 
On the tenth day of election bribes, Geoff Simmons gave to me: ten pothead candidates, nine screaming conspiracists, eight private school handouts, seven baby bonuses, six nationalised SOEs, reforming ACC, four semi-autos, three billion trees, two four-lane highways and a holiday on Matariki.
 
On the eleventh day of election bribes, Winston gave to me: eleven amateur interviewers, ten pothead candidates, nine screaming conspiracists, eight private school handouts, seven baby bonuses, six nationalised SOEs, reforming ACC, four semi-autos, three billion trees, two four-lane highways and a holiday on Matariki.
 
On the twelfth day of election bribes, Brooke gave to me: twelve sets of tax cuts, eleven amateur interviewers, ten pothead candidates, nine screaming conspiracists, eight private school handouts, seven baby bonuses, six nationalised SOEs, reforming ACC, four semi-autos, three billion trees, two four-lane highways and a holiday on Matariki.
 
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