You are subscribed as | Unsubscribe | View online version | Forward to a friend

Insights 41: 30 October 2020
NZ Herald: Oliver Hartwich on why we don't know how unlucky we are in NZ
Podcast: Matt Burgess on the RBNZís curious climate speech
Newsroom: Eric Crampton outlines why changes to 135 school zones are a big experiment

No time for treading water at the border
Roger Partridge | Chairman |
Voters rewarded the Coalition Government for saving lives as the Covid-19 pandemic swept the world. Now the new Government must save livelihoods.

The immediate priority is the border.

New Zealand may be an island nation, but our economy cannot get its head above water without international labour. From construction to banking, and from IT to horticulture, overseas workers are critical to Kiwi firms. Without them, projects will stall, crops will be left unpicked, businesses will fail, and jobs will be needlessly lost.

With so few spaces in its managed isolation and quarantine (MIQ) facilities, the Government has prioritised returning Kiwis. And rightly so.

The problem is that fewer than half the visa applications for critical overseas workers have been approved – despite MIQ occupancy rates tracking at about 70% of capacity for the last two months.

On election day (17 October), the Ministry of Business, Immigration and Employment reported that the “effective capacity” of MIQ was 7252 beds. “Occupancy” was only 4825 beds. “Vacancy” stood at 2427. Projected occupancy over the next 14 days showed a similar pattern.

The unused quarantine capacity in that fortnight alone would be enough to accommodate all the critical worker applications made by firms between June and September.

MBIE’s failure to allow these workers to enter when quarantine capacity is available suggests officials have the wrong priorities. The new Government must fix this.

It should then look at the shortage of overseas workers who do not currently qualify under MBIE’s “critical worker” criteria. It is not fair that Kiwi firms lacking political pull are unable to get critical staff into the country, when well-connected America’s Cup syndicates are able to bring in team members, their families and even nannies into the country.

The new Government must also solve the other big border issue: the Trans-Tasman bubble. The Australian states that have conquered Covid show that travel between the two countries is politically feasible.

The prize for getting border security right is Australia’s 25 million potential tourists. They are exactly what the Kiwi tourism and hospitality sectors need to stay afloat.

With summer holiday season fast approaching, the new Government should prioritise safely re-opening our borders with the Covid-free states in our Trans-Tasman neighbour.

In the event of a local outbreak – in either country – borders can be swiftly re-closed. And to reassure the Kiwi public, the Government should act on a call this week from Otago University epidemiologists for a systematic reassessment of border security to reduce the risk of future failures.

The economy will sink if the Government keeps treading water on the border.

OODA loops and media bias
Nathan Smith | Chief Editor |
As US military strategist John Boyd said about his “OODA loop” theory (observe, orient, decide, act), if one’s orientation is out by just a millimetre, the entire strategy fails.

A new site called measures the political bias of New Zealand news services and it shows those worried about media bias are worried about the wrong thing. Their OODA loop is off.

The site uses machine learning to find a name of a politician, check the nearby words, judge their meaning and then apply a number. It’s not perfect. But judging media bias has been notoriously difficult since it requires a neutral point, and there isn’t one.

The site’s creator James Diprose says his tool’s results are experimental and outlets like Stuff have more articles in the pot (13,826) than smaller sites like (683). But there are patterns.

For instance, blog sites The Standard and The Daily Blog lean heavily left. The BFD (a revamp of WhaleOil) and Kiwiblog are more right leaning. For the digital newspapers (as opposed to blogs), the NZ Herald is closest to the centre – although still leaning left – while Newshub is furthest to the left – but still relatively centre.

What does this tell us?

The first observation is that if 13 of the 15 major news sites are left-leaning, is it even proper to call that a bias anymore? Even with a clear left bias, those on the political left will still bemoan that media is too conservative. What gives? Something else is going on.

This tool proves that complaining about left bias in media is like being surprised that there are gamblers in a casino. Since journalists are the result of a cradle-to-grave progressive education system, their opinions will naturally be progressive.

After all, public opinion on every issue in 2020 is really, really far to the political left compared with 1920 which can only be a result of generations of education. This means public opinion on any subject slowly shifts towards the opinions of those who write and explain a subject to the public. It’s not rocket science.

In other words, media is left because those who teach journalists are left. Schools, academia and media are part of the same democratic machine to direct and control public opinion.

If this is a problem, then solving it with a good OODA loop requires locating the problem as in the education system, not the editorial pages.

I understand this just made the task enormously daunting. Much simpler to complain about media bias instead.

The New Zealand World Order
Dr Eric Crampton | Chief Economist |
It all finally started coming together in the 2021 Budget. The pieces existed before it, but nobody had put them together. When they did, Pax Zealandia followed.

Borrowing to invest in the New Zealand SuperFund was nothing new. But while money was cheap, the Government hadn’t seriously leveraged up to make stock market plays. Bernard Hickey screamed from the sidelines that the Government should borrow far more. But even his thinking was blinkered by prevailing orthodoxies.

And SuperFund investments were previously used, in limited ways, to advance Government objectives. During the Christchurch Call, the fund had coordinated with other investment vehicles. But ambitions remained too limited.

Once the Government realised that borrowing was effectively free, that debt-to-GDP ratios were passé and that it could exercise ownership rights through the SuperFund to advance state aims – well, things started getting interesting. The Government could print and borrow near-infinite money, put it into the SuperFund and buy all the things.

The world’s airlines were dirt cheap. A controlling interest in every publicly-traded international carrier was chump-change. It cost less than $40 billion, or about 12% of GDP. The Government’s high-value tourism policy was the end of economy-class tourist fares to New Zealand.

The US dairy compacts always lobbied against free trade deals. Buying them out simplified an agreement with President Biden. But the second American Civil War made the trade deal futile.

Gross debt-to-GDP really blew out on buying Google, but net debt-to-GDP was fine. A substantial asset offset the debt. Legions of Kiwi censors suppressed unkind search results, and the world was a happier place.

That led to a series of leveraged state takeovers ushering in the new and better global order we all now enjoy. The SuperFund bought whole countries. After installing Kiwi administrators and fixing the worst of those countries’ problems, it sold them back to the residents at a profit. Turkey was the first after its regime imploded. But others were snapped up, including the salvageable bits of the former United States.

The exact moment it started is a small ironic footnote in the history books. Some columnist teased the Government that if it was such a great idea to borrow more than half a percent of GDP in a pandemic to make leveraged plays on the stock markets, then borrowing 50% could be even better. And, for once, the Government listened.
On The Record
All Things Considered
Copyright © 2021 The New Zealand Initiative, All Rights Reserved

Unsubscribe me please

Brought to you by outreachcrm