Progress Newsletter 13/09/2017

Could Greens decide the election?


Newshub's poll that showed the government being re-elected is a dilemma for Greens. 0.1% more support and they are back in government - and if Labour is averaging a bit higher than the Newshub poll then a Labour-Green government is still in prospect. But if they don’t get that last 0.1%, then a National government is re-elected even if the Newshub poll is overenthusiastic.  And the Greens usually underperform their pre-election polls, suggesting Green votes will be wasted.


National continues to run a tin-eared and leaden footed campaign, with eruptions such as the off-message outburst from a conservative back bencher who equated euthanasia and suicide. We are sceptical that Steven Joyce’s claims of a phantom hole in Labour’s budget have worked, but other hits are sticking - including a scare that an inheritance tax could be on the table. 



Bashing foreigners is not progressive


Meanwhile, we would like Labour to clarify a few couple of elements of its trade policy and proposal to ban foreign speculators.


Labour has promised to renegotiate not only the TPP, but more recently the existing South Korean trade agreement. Putting aside that lengthy trade renegotiations on an existing agreement is surely the last thing our Korean friends want to deal with right now, Labour’s opposition is based purely on a technicality. To both, it promises to withdraw unless it can gain an exemption to ban foreign house buyers. This poses risks: under our CER agreement with Australia, we cannot restrict their sales of houses, yet exempting them may violate most-favoured-nation clauses with China and South Korea.


As for the ban on foreign speculators buying houses, we’re not clear if its a ban on speculators - in which case, why mention foreigners? Labour intend to extend to 5 years the period when you can be taxed if you flip a house that’s not the one you’re living in. That’s fine policy, but it applies to all speculators, not just foreigners.


Or is the policy to ban foreigners from buying homes? In which case why call all foreigners ‘speculators’ - its not the speculation they are targeting, it is the foreigners. And which foreigners? We can’t ban Australians, who almost certainly buy far more of New Zealand than anyone else. 


Labour doesn’t have evidence that ‘foreign speculators’ are driving up Auckland house prices - that’s why it ran the horrifying racial profiling of Chinese sounding names. The point was to demonstrate that Chinese buyers are the problem, and the list of Chinese sounding names was complied because it couldn’t find any substantive evidence to back up the claim. The ongoing attacks on ‘foreign speculators’ are a pus oozing from the same festering wound.



The future, not the past


Josie Pagani in State of the Left:

To understand Labour’s stunning turnabout in fortunes we should study closely the trilogy of messages UK Labour ran in 1997: the future not the past, leadership not drift, and the many not the few.


In New Zealand today, the government is asking for support on the basis of its management in office. Its strategy focuses on the past, while the fresh, charismatic 37-year-old Labour leader looks like the future.


The government is drifting, unable to outline a vision for the country while Labour has campaigned on the slogan ‘Let’s Do This’, harnessing a sense of purpose and momentum.


And Labour has campaigned against a house price bubble that has made home ownership unaffordable for the many, on the costs of tertiary education that have confronted students with debt, and on whether a few companies should get all the benefit from commercial sales of our pure water for themselves.


The policy menu is a bit sketchy. If Labour fails to win from here it will be because it has failed to do enough policy work in the last nine years to have a credible tax plan today.





How to create middle class jobs

Many of the ideas for the US from these world class economists are importable, some are not, some are ghastly - but the list is worth a read.


We like:


Building infrastructure.

Bridges, roads, public transportation—all this stuff is old relative to the infrastructure in most other developed countries. Infrastructure investment could create a lot of employment, and having better infrastructure could create more attractive places for businesses to open up. It could reduce commute times and increase productivity in a lot of ways. It could also help generate demand for the kinds of jobs that the middle class has been losing. 




There’s a good argument that we would increase productivity growth if we invested intelligently in infrastructure. There are political considerations that sometimes mean infrastructure decisions aren’t necessarily allocated as well as you’d like them to be. But if carefully considered and thought out, infrastructure investment could raise productivity.



Training more skilled workers

When you increase the number of skilled people, you do two things: you move people from low-skilled to high-skilled work, which has a direct effect on their earnings, and you make skilled people a little bit less scarce and less-skilled people a little bit more scarce. At the same time, that’s going to raise the wages of all the people that got left behind.



Upgrading some low paid jobs like rest home care.

Anytime elder-care patients need an IV or catheterization or another simple medical procedure, they have to get someone other than their home-care worker to do it. If these home-health-care workers completed a training program and became certified to do minor skilled procedures, their wages would increase. It would lift the prospects of a large number of providers, be a benefit to patients, and save resources in the health-care system.



Blair comes out for immigration controls

Tony Blair has been wrestling with Brexit - the reasons people voted for it, how to avoid the most damaging impacts, and how to grow support for Europe. His answer will trouble a lot of his fans: Immigration has to be managed better.

“We recommend that the government seek to negotiate a strengthened ‘emergency brake’ to implement temporary controls on free movement in particular sectors during periods of high EU inflows. 


This would enable the UK to exercise greater control over immigration, whilst leaving open the option of the UK remaining within the EU, or failing that, as members of the Single Market. 


We also argue that reforming free movement is not enough: dealing with anxiety about immigration must involve a wider set of changes, covering labour market reform, social integration, enforcement against illegal migration and the strengthening of democratic accountability. 


Finally, should Brexit happen, the least damaging outcome for Britain would be to establish a preferential work permit system, whereby free movement continues for certain categories of people, for instance, highly skilled professionals and students, but is restricted for others, for example, low skilled workers.




Maybe Jeremy Corbyn really is good at politics

While everyone else is preoccupied with Brexit, Corbyn was talking about the boss of McDonald’s, who earned £11.8m last year while some of his staff are paid as little as £4.75 per hour.



The intern

The 48 year old mum of 3 from Yorkshire whose success should be making employers think about hiring practice.

We’re not fans of unpaid internships - people should be paid for working. But here’s a great success story.



The police state

“I was an idiot.” An obit for the secret police chief of a totalitarian state.


Election watch

Angela Merkel continues to cruise towards re-election the day after we vote.

As in previous elections, Ms Merkel has concentrated on vaguely defined but important positives: economic wellbeing, low unemployment, social stability and EU co-operation. The CDU’s main slogan is: “For a Germany in which we live well and happily.”



See also: The three pillars of Merkelism:

1: She thinks ethically, not ideologically. 

2: She is reactive, not programmatic. She manages events as they arise rather than hatching long-term plans. 

3: Detachment, not engagement. Mrs Merkel keeps her options open and strives never to rile or polarise. 


State of the Left argues SPD leader Martin Schulz has struggled to make an issue out of traditional social democratic topics - social justice, pensions, and unemployment reforms


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