The Post: Time to hold the Government to account for the social costs of its spending decisions

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The problem with left-wing governments, Margaret Thatcher once said, is that they always run out of other people’s money.

What the Iron Lady wouldn’t admit, of course, is that if Labour parties’ budgets get stretched, it’s generally because they’re cleaning up the social and environmental messes left by their conservative predecessors. And that’s something to watch when our new Finance Minister, Nicola Willis, delivers her mini-Budget next week.

One of the most profound problems in New Zealand politics, and one that retards our national progress, is that financial deficits are eminently visible but social and environmental ones are not. If the government spends more than it earns, the result is unambiguous: a single number, universally relevant, written in black and white (and red). It’s easily grasped, as is the consequence of running one such deficit after another. So that’s what we talk about.

Inside government, the same problems apply. To borrow an example from Craig Renney, Grant Robertson’s former right-hand man, the Treasury can tell you, just about down to the last brick, how much it is costing us to build Dunedin Hospital – but not what it cost the city’s health all those years we delayed construction, services worsened, and people sickened and died.

Some social – and environmental – deficits can of course be defined, and have numbers attached to them. But there are thousands of these issues, they are poorly measured, people disagree about which ones matter most, and often – because they affect the most vulnerable – they remain invisible to the median voter.

So they don’t receive the same obssessive attention, inside or outside government, as the need to turn red ink to black. Labour tried, tentatively, to fix this with its wellbeing approach, but got stuck with 100-plus measures of social and environmental failure – too many to ever be tractable.

All this has a troubling consequence: it lets conservative parties off the hook. The last National government ran a tight financial ship, but was permitted to pile up appalling social deficits.

State houses were sold off, allowing the shortfall to rise by another 14,000 homes. Middlemore Hospital had sewage running down the walls. Dirty dairying left the country with sick, algae-ridden rivers and lakes, some of the most polluted waterways in the developed world.

Cold, damp housing filled children’s lungs with respiratory illnesses. Countless social services went unfunded. National’s books were balanced – but on the backs of the poor. And because social and environmental deficits always become financial ones – sick children need costly hospital care, polluted lakes require multi-million-dollar clean-ups – it also bequeathed us a long-term budgetary hole.

That’s not to say that Labour came in and spent every cent wisely. It didn’t. Funding for health and education has doubled, or nearly so, sometimes with little to show for it. Hence a core dilemma of New Zealand politics: the unpalatable choice between a National Party willing to run up social and environmental deficits and a Labour Party with no clear idea how to close them.

But, in Labour’s defence, it did wipe $1.8 billion of district health board deficits. It settled billion-dollar pay-equity claims for health and education workers, and built or bought 13,000 public homes. It doubled capital spending, helping close New Zealand’s colossal infrastructure deficit, and raised beneficiaries’ incomes. Yes, it ran financial deficits post-Covid – but so did National post-GFC.

Next week, Willis will emphasise Labour’s alleged financial woes, but our attention should be on any social and environmental shortfalls she sets in train. To rework Thatcher’s famous line, the problem with conservative governments is that they always run into other people’s misery.

To hold National to account, we will need to continue the project of measuring the wellbeing impacts of every decision – and, as with Dunedin Hospital, non-decision.

Beyond that, we may need to choose, collectively, 10 indicators that matter to us most profoundly – issues where failure cuts deepest and success is most precious – and, by reporting on them repeatedly, give them the same weight as the budgetary numbers.

These 10 targets, spanning – for instance – employment, life expectancy and river quality, could be enshrined in legislation, just like their financial counterparts.

Why 10, specifically? When I posed this question last year to Nobel laureate Joseph Stiglitz, a godfather of wellbeing economics, he said we should pick a handful of measures “that are at the centre of societal debate”.

These issues could be selected via opinion polling, but to get the public’s considered view – what they think after hearing others’ arguments, reflecting, and shifting their position – the task might be best handed to a citizens’ assembly.

A randomly selected group of 100 demographically representative Kiwis – the nation in a room, as it were – could decide on the 10 measures, their work getting updated every few years. And maybe then the shortfalls facing people and planet might get the same attention as the dollar signs.

The Guardian: Labour failed but New Zealand can’t put a wealth tax ‘back in the bottle’

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Licking its wounds from October’s election defeat, the New Zealand Labour party faces an internal struggle over a question that could define its recent past and its future electoral prospects: whether to campaign for a tax on the assets of the country’s wealthiest individuals.

Insiders say party members still feel “anger and disappointment” about the “captain’s call” by leader Chris Hipkins to rule out running on a wealth tax in this year’s election.

At the urging of key Labour ministers, officials had spent nearly a year working on plans for wealth taxes, a policy whose re-emergence on the global scene symbolises a newfound radicalism among leftwing parties.

Until recently, most developed nations have relied on taxing income, including wages, salaries and more irregular forms like capital gains (the profits made on selling assets). But concern about soaring wealth inequalities, and the work of French economist Thomas Piketty, has reignited interest in taxing assets like property and investments.

In the 1980s a dozen European countries had wealth taxes – a small annual levy on the largest fortunes. Today, only Switzerland, Norway and Spain do, alongside a handful of South American nations. France dropped its equivalent several years ago, in favour of a tax on high-value property.

But the idea is attracting renewed interest even in places like the US and Britain. “Wealth taxes have moved from the fringes,” says New Zealand-based tax consultant Terry Baucher. “Piketty has given them a boost … They have come back into vogue.”

The wealth tax contemplated by New Zealand Labour would have required couples to pay an annual levy of 1.5% on any assets they held over a $10m threshold. The estimated $3.8bn in revenue would have funded income-tax cuts for the vast majority of Kiwis. Labour’s potential coalition partners, the Greens and the indigenous-led Te Pāti Māori, ran on similar platforms.

But for Hipkins, known within the party as “Chippy”, the tax lacked popular appeal – “Chippy just didn’t think he could sell it,” one party source says – and he ruled it out in April this year.

This came as a blow to many in the party, including MPs who said on the campaign trail they had “not given up” on a wealth tax.

Nor have party members. Pro-tax reformers are now running for key positions on Labour’s policy council, and seeking to put pressure on the leadership. As one Labour MP puts it: “I think we’ve uncorked something here that can’t be put back in the bottle.”

For them, the policy seems like a slam-dunk. Though hardly anyone would pay the tax, it would generate billions of dollars a year. And in contrast to a capital gains tax (CGT) – something New Zealand also lacks – it would raise revenue instantly, whereas a CGT could take as much as a decade to generate similar sums.

Polls earlier this year showed a majority of Kiwis back a wealth tax. But at the same time, Labour’s pollsters were warning that, in focus group after focus group, support had crumbled because people found the policy hard to grasp and the counter-arguments persuasive.

One person familiar with the findings says: “Leaving aside common mistakes about the way the current tax system works, the moment someone said, ‘What about a farm on the East Coast, what about a tech start-up?’ – or any other scenario they could think of where someone was asset-rich but cash-poor, they started to unload on it [the wealth tax] in a way that was very hard to get them to pedal back from.” By the end of these discussions, very few would support a wealth tax.

An unreleased post-election poll, meanwhile, suggests a wealth tax would have cost the left slightly more votes than it gained. It is, nonetheless, an issue that won’t go away, as Labour – like its global counterparts – seeks to raise revenue for spending pledges without over-burdening standard income taxes.

As one Labour source says: “I can’t see how the party can go to another election without something [on taxing wealth].”

The Post: Watch out for the rise of conservative conspiracy theories

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For a government ostensibly opposed to “cancel culture”, our new political masters sure like cancelling things, don’t they?

Policies to prevent smoking; discounts for cleaner cars; rules to stop renters being arbitrarily evicted: they’re all on National’s chopping block.

The real descent into the culture wars, though, comes with the rapid embrace – by National’s coalition partners and political outriders – of populist conspiracy theories.

The deputy prime minister, Winston Peters, fired the first salvo, claiming media were “bribed” by Labour’s $55 million Public Interest Journalism Fund. In the absence of any shred of evidence that the funding biased reporters, this is clearly a conspiracy theory of the most repellent kind.

Which makes it all the more disappointing that our new prime minister, Christopher Luxon, not only failed to refute the allegations but tacitly encouraged them, saying the funding “leads to perceptions of bias” and that it “doesn't really matter” whether the perception is real or not. When your deputy is pushing conspiracy theories, Mr Luxon, the truth does matter.

To make matters worse, Peters is emboldening his conspiratorial base by implying that revised World Health Organisation rules are some kind of threat to New Zealand’s sovereignty. In fact they just streamline action against future pandemics, and are already subject to the “national interest” test he’s blustering about.

But it’s not just Winston. In Wellington, vague claims circulate that all kinds of budgetary problems, hidden by Labour, will come to light with this month’s fiscal update.

By law, though, everything that could have been disclosed was disclosed in September’s pre-election financial statement.

Some items – known technically as fiscal risks – didn’t have specific numbers attached to them, as their costs were either uncertain or commercially sensitive. But these are known unknowns, of the kind declared and bequeathed by every government to its successor, rather than deliberately concealed time-bombs.

More worrying still is the importation of foreign scare stories. Writing in alarmist tones, the right-wing Taxpayers’ Union this week warned supporters that “media and bureaucratic forces” were “already working to undermine the new government”.

The lobby group also suggested that Luxon and co were about to be “ground down” by the “Wellington blob”. A daft but innocuous term, one might think – until one realises it comes straight from the playbook of the UK’s Conservative Party, for whom it denotes a vast, sprawling conspiracy.

In Conservative fantasy-land, every one of their policy disasters – most notably Brexit – is caused not by their own incompetence but by a “Blob” of obstructive public servants who, alongside their media allies, conspire to undermine right-wing plans. The “Blob” is also blamed for somehow terminating the careers of various Conservative politicians.

The name is silly, but its implication serious. This is yet another sally in the populist culture war that paints public servants, academics and journalists as enemies of the people. And it leads to ugly places: the vilification of the judiciary, assaults on human rights law, and, above all, an entirely unfounded impression of some vast and elitist conspiracy thwarting the people’s will.

In the US, predictably, this theory takes ever-more insane forms. Leading right-wingers – among them the Trumpian Congressman J D Vance, author of the bestselling Hillbilly Elegy– claim that American life is controlled by an imaginary nexus of media, academia and bureaucracy known as “the Cathedral”.

In New Zealand such narratives are, thankfully, marginal. But they must be confronted early on, lest they take hold.

Ditto certain policy ideas. Right-wingers have recently begun to suggest that new ministers should be able to immediately dismiss government agencies’ chief executives, lest the latter act as a handbrake on reform.

The fact that this idea is warmly endorsed by New Zealand First’s Shane Jones, a man who dislikes close scrutiny, should be warning enough. Even leaving aside the absence of evidence that chief executives are causing such problems, this plan would be a recipe for politicising the public service and creating a cadre of yes-men and women unwilling to point out flaws in ministers’ plans. Which, ultimately, would lead to weakened policies, money wasted and lives damaged.

The public service is not, of course, perfect, and agencies can certainly go slow on ministerial projects they dislike, repeatedly and spuriously raising the need for “further research”. But these delays affect left-wing ministers as well as right-wing ones.

Focused politicians, in any case, have always been able to push through these minor thickets. If this Government fails, it will do so on its own terms, not because of a vast bureaucratic conspiracy.

Our public sector should undoubtedly become more transparent, and rebuild its hollowed-out capacity, as it seeks to restore public trust. But that is part of a natural process of evolution in the agencies of the state. There is nothing deeply rotten underneath them, no malignant conspiracy, and we should not indulge anyone who suggests there is.

The Spinoff: 12 graphs that show New Zealand isn’t doing as badly as you think

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How would you describe New Zealand right now? According to recent analysis, the nation is either “wet, whiny and inward-looking”  (new prime minister Christopher Luxon), “beautiful but mediocre” (think-tank head Oliver Hartwich), caught in “the Great Centrist Drift” (political writer Danyl Mclauchlan), or, quite simply, “broken” (all commentators everywhere). Welcome to New Zealand in late 2023, political mood: depressed.

It’s not just the commentators: most Kiwis think the country is on the wrong track. Even centre-right voters seem unenthused by a new government that – in essence – won power as the lesser of two evils. On the left, meanwhile, the coolest or most credible political stance has long been one of despair. Savvy-seeming people compete for the most extreme take: inequality “skyrocketing”, the planet “on fire”, the whole situation “f**ked”.

There are many reasons not to be cheerful, especially where the climate is concerned. Yet this attitude can blind us to all the things that are getting better. And when we fail to celebrate our wins, that defective self-knowledge diminishes our sense of our own capacity, shrinks our horizons, inspires defeatism.

Let us consider, then, what might be termed the Upturn: the trends already heading in the right direction, or about to do so.

Greenhouse gas emissions

New Zealand’s carbon emissions are, at long last, falling. We should have celebrated this news, shouted it from the rooftops. Yet it was received with no fanfare – barely even a solitary bugle. So it bears repeating: New Zealand’s carbon emissions are falling.

This is due in part to forces outside our control – full hydro lakes and high petrol prices spring to mind – but also to policies like the clean car discount and the rising carbon price in the Emissions Trading Scheme, as well as renewables generating 90% of electricity for the first time in four decades. The Zero Carbon Act has, more broadly, reframed the debate from “should we do anything about climate change?” to “what should we do about climate change”?

In short, Jacinda Ardern, James Shaw and others have, under pressure from activists, bent the curve. New Zealand has finally begun reducing its contribution to the planet’s over-heating.

Emissions, of course, are still not falling fast enough, farmers seem determined never to pay for their carbon pollution – and any progress could reverse under National. But the EV market, which Labour invigorated, may now have enough momentum to keep growing even without the clean car discount; renewable energy schemes will keep coming online; and the public demand for National to “do something” may be just about sufficient. There is, at least, a base on which campaigners can build.

Child poverty

Next to climate change, economic inequality is one of New Zealand’s gravest challenges. Again, the mood is sombre: just look at the foodbank queues. But while there is undeniable hardship, especially among the very poorest, over the last decade the rates of deprivation have on some measures halved. This is one of the great unacknowledged success stories of New Zealand life, the result of a growing economy and increased employment (under National) and all of the above plus sweeping benefit increases (under Labour).

Will these achievements continue? Again, possibly not, given the new government’s intention to increase benefits much more slowly than the last one did. But Christopher Luxon is rhetorically committed to meeting 2028 targets that would require us to halve child poverty again, reducing it to one of the lowest levels in the world. There is bipartisan support for the goal – and something against which to hold National accountable.

Race relations

The election saw a distasteful rise in anti-Māori rhetoric. But does that reflect a large or permanent tide of hatred? Not necessarily. Two points of data from the New Zealand Election Survey, taken in 2002 and 2020, show that not only is each age cohort becoming more comfortable with the Treaty of Waitangi’s prominence over time, every new cohort starts from a more accepting position than the previous one. Bigotry and an anti-Māori backlash are undeniably present, in the form of Julian Batchelor and others. But such sentiments may not rest on a solid foundation: in the long run, New Zealand appears to be getting less racist.

Smoking rates

In the last decade, smoking rates have halved for nearly every ethnicity: a stunning endorsement of health campaigners’ successes. On the other hand, Māori and Pacific Peoples’ rates remain far higher than those of Pākehā. The rise in vaping, especially among young people, is also troubling. But there is, overall, progress on which the likely new health minister, Shane Reti, can build – and he’s signalled he won’t junk everything in the last government’s plan for a “smoke-free generation”.

Ram raids

Short-term problems are also solvable. At times in the last 12 months ram raids have felt like a never-ending nightmare, the result of a deeply ingrained dysfunction with no apparent fix. But in fact the raids are already well down, thanks in part to “circuit breaker” programmes that give perpetrators same-day, wrap-around social support and boast an 80% success rate in preventing re-offending. It turns out the government can tackle complex issues. It could even learn a lesson here and make these circuit breakers – and programmes like Kotahi te Whakaaro – part of standard practice.

Justice reform

Nor is progress in the criminal justice system limited to the short term. The over-representation of Māori in prisons has long been a stain on the nation’s conscience, and is far from being resolved. But previously unpublished figures, compiled by the statistician Len Cook, show that a young Māori man’s chances of being sentenced to prison have fallen to their lowest level since WWII. This is thanks in part to the gradual turn towards a less punitive system, spurred by the advocacy of reformers like Moana Jackson, and the abolition of things like borstals and boys’ homes, notably cruel forms of detention that once loomed large in the lives of young Māori men.

School attendance

Another issue that bedevilled the last government may finally be turning a corner. Educational attendance plummeted in Covid’s aftermath, as schooling patterns were disrupted and the cost-of-living crisis forced young people into work. Last year, regular student attendance – defined by the Ministry of Education as students being at school at least 90% of the time – fell to just 39.8% in term two, the period when children are most absent due to winter illness.

In term two this year, the rate was 47% – hardly great, but an improvement nonetheless. And the definition of “regular” is stringent: any child who misses six days with a cold fails to make the cut. Including those kids, the attendance rate is three-quarters: again, nowhere near good enough, but less disastrous than sometimes suggested. And National’s intense focus on this issue will, presumably, help get the figures back to something acceptable.

Emergency housing

The families forced by the housing crisis into government-funded motels have seemed a permanent fixture in the nation’s polyvalent woes. But as more social housing has come on stream – some 13,000 places were built or bought under Labour – the numbers have begun to drop. From a peak of 4,911 families in emergency accommodation in December 2021, the tally has fallen to 3,396 in August this year. That is still 3,396 too many – but a reduction of 1,515, or nearly one-third.

Public transport use

The Covid lockdowns piled woe onto public transport systems already seen by some as terminally inadequate. But as the Auckland and Wellington figures demonstrate, patronage is returning to pre-lockdown peaks, and for some modes of transport – the capital’s buses, for instance – has even exceeded its 2020 levels. Both regions have ambitious plans to boost patronage still further. How well that survives the new government’s pro-car orientation remains to be seen. Still: public transport, like nature, seems to be healing itself.

In short

What does this data tell us? Not that all is well. Another story could easily be compiled from graphs that point the other way: school results slipping, vaccination rates declining, suicides remaining stubbornly high. Nor has progress, such as it is, occurred at a speed commensurate with the challenges we confront. In some cases the green shoots, barely above the surface, are tentative, tender, easily harmed.

But if – to use a different metaphor – so many problems have turned, or are turning, a corner, others can too. And these are not minor, over-hyped instances of progress: carbon emissions, child poverty and smoking rates are among the most important issues we face. Other positive trends could also be cited: the predator-free-inspired revival of birdlife, for instance, or the thousands of new nurses recruited to ease the health crisis. The Upturn is far from comprehensive, but it is real.

Nor has social and environmental progress come about through chance or natural forces. It has been won by those who have agitated, argued and fought for a better world. Activists, business leaders, politicians and public servants have shifted the terms of debate, and progress has followed, though more hesitantly and erratically than is ideal. Much good has been achieved in the last decade, across multiple governments. Much more may lie ahead.

The Post: Higher rates for the rich, and other ideas for local govt’s funding crisis

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If our local councils are to repair water pipes, mitigate and adapt to climate change, and generally improve their communities’ quality of life, should that extra cost fall on Remuera or Otara? Khandallah or Kilbirnie? Merivale or Riccarton?

This urgent question confronts a handful of “high-growth” councils, notably those in urban centres facing both increased demands on their infrastructure and a looming financial crisis.

Auckland has just been through a painful round of cuts, Wellington proposes to slash infrastructure spending while hiking rates, and Hutt City warns of budget blowouts. Pressures are acute elsewhere, too.

Conservatives argue they all need to rein in their spending. But although any organisation can trim costs, and learn to avoid white-elephant projects, the problems are not really on the expenses side.

The much-abused cycleways, for instance, actually deliver benefits – lower emissions, healthier people – far in excess of their costs – potentially by a factor of 10, researchers argue.

Blow-outs on big infrastructure projects like Wellington’s Town Hall remain a concern. Better project management is urgently needed – but that, in fairness, is a New Zealand-wide problem.

The real issue is that local councils don’t have the revenue they need to upgrade pipes – forecast to cost $1 billion a year in Wellington alone – and generally support their communities. Under fiscal pressure, Wellington has just ditched a $25 million plan to switch swimming pools to low-emission heating, robbing the future to make ends meet in the present.

The standard local-council solution to these problems is to demand more from the Beehive: a share of GST proceeds, rates paid on central-government buildings, funding for new pipes.

But while these requests are understandable, they really just shuffle revenue from one part of the state to the other, without expanding its ability to provide the public goods on which our shared prosperity rests.

In my view, councils have a democratic mandate to seek innovative revenue-raising powers. In Wellington’s recent citizens’ assembly, for instance, a representative group of 40 ordinary residents urged the council to petition the Beehive for new funding tools.

After all, local councils, according to Statistics New Zealand, generate a tiny amount of revenue – just 2% of GDP, the same figure as in 1920. And rates make up a higher proportion of their income than in any comparable country, Local Government New Zealand says.

This could be augmented with tools like a “value uplift” levy, effectively an extra tax on residents when new infrastructure – better roads, parks, other amenities – boosts the worth of their property. Councils could, as Wellington is currently considering, also tax unused land at higher rates, discouraging land-banking.

I would propose two further ideas that challenge the current financial orthodoxy.

The first would be to levy rates at a higher percentage on wealthier properties. This would imitate income taxes, where there is widespread support for a “progressive” approach: as someone earns more, the amount they pay on each extra dollar rises from 10.5% to as high as 39%.

A core concept here is ability to pay. Flat-rate income taxes don’t work: a 25% levy, say, would leave someone on $60,000 with a miserly $45,000 for expenses, whereas someone on $600,000 would still have $450,000 left. The former should (and do) pay less, while only the latter can afford to pay taxes at 39% – or indeed more – to fund public goods.

Yet we do not extend this widely accepted principle to local council rates, which are levied at a flat rate either in dollar terms (a $500 charge for every resident) or in percentage terms (everyone pays 1% of the value of their property).

So my first proposal would be to change the law to allow councils to levy progressive rates, so that those living in Remuera villas and Karori mansions contribute more to the cost of repairing water pipes and fighting climate change. Asset-rich but cash-poor residents could defer paying the rates until they are in a position to do so, as many councils already allow.

My second proposal is that, except in rare circumstances, we stop building new houses by concreting over nature. Not only is greenfield development environmentally damaging, it is for most councils an economic disaster.

While local authorities do get financial “contributions” from developers, this never fully recoups the immense cost of providing new roads, pipes and wiring to greenfield sites. According to economists Sense Partners, each new greenfield dwelling could cost a council thousands of dollars.

By contrast, densification – more homes in city centres – requires very little investment in infrastructure already built to service the massive daytime demands of workers, while vastly expanding the revenue base. The likely several-thousand-dollar net benefit to councils from each high-density dwelling is the exact inverse of the typical greenfield house’s net cost.

Turns out that the smart thing to do socially and environmentally is also the right financial move. Who’d have thought?

The Post: To overcome our divisions, we must first learn to see each other

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Some years back, academics discovered that well-off Kiwis don’t support the redistribution of wealth. Surprise, surprise, you might say. Someone give those boffins an IgNobel award for research into the bleeding obvious.

The reason for this wealthy reluctance, though, was telling. In socially segregated New Zealand, the rich live surrounded by the equally rich and, assessing the nation’s health by gazing over the back fence, fail to grasp how poor the other half are and how much help they need.

Recent polls, in which three-quarters of New Zealanders say the country is becoming more divided, have been interpreted as a backlash against vaccine mandates or co-governance. But they may also reflect our sharp rise in economic disparities three decades ago, which continues to reverberate long past its origin.

Clearly, at any rate, some New Zealanders can barely see each other, in a moral or social sense – except perhaps as an enemy or a distant “other”. Nor should we expect this to change any time soon.

Major crises can catalyse solidarity: a century ago, two world wars – plus an influenza epidemic and a prostrating economic depression – generated a sense of shared suffering that paved the way for the welfare state’s creation.

But because modern governments are far better at emergency management than their predecessors, the social and economic shocks from our own crises – the GFC and the pandemic – have been blessedly shallow, in historical terms.

Absent that unified suffering, some face instead the slow, isolating grind of a cost-of-living crisis. Many families have hunkered down, too focused on survival to worry much about others. And the economy’s poor outlook augurs no quick change to this dynamic.

How, then, do we stop the drift into discord and dysfunction? One urgent task is to repair and renew the social safety net.

Economic insecurity turns people inward, and renders them defensive and suspicious of others. Overseas research shows a clear link between insecurity and reactionary populism.

Imagine, conversely, a world in which we manage big shocks collectively, providing beautiful public housing at scale, social insurance for the newly laid-off, and protection against precarious work. Schemes for emissions reduction and managed retreat could counteract the insecurity that climate change creates.

Support for such measures, though, will be sustained only if people of different status see each other as inherently deserving. For it is this mutual recognition that, although strained by disparities, preserves our social fabric.

On my regular late-evening walks around town, I am struck by how clearly I can see the lights of far-off houses, despite the dark suburbs of distance between us. Equally miraculous, in political terms, is the existence of the welfare state, which relies on people in Bluff paying taxes to support beneficiaries in Kaitaia whom they will never, in the ordinary course of events, get to meet.

Like pin-points of light in the dark, the lives of others remain visible to us, if only just. And we can enhance this visibility by creating sites – and sights – of social encounter.

In practical terms, that requires, among other things, a continued pushback against the schools who redraw their zones to hive off the richer suburbs. Social mixing at an early age, such as I experienced, is vital. But we also need to better fund, and reform, the poorer schools, so that no parent resents having to send their kids there.

We should also consider more unorthodox measures. Wealthier kids have always done gap years offshore, to see more of the world. What about a kind of internal gap year scheme, in which young adults are funded to spend at least a few months working in communities different to their own? I know of young doctors whose privileged worldviews were transformed by a short placement in Porirua East.

And because the lives of those who struggle can be invisible to those who do not, we may need a concerted effort to better tell the stories of poverty, in compelling images, video and prose.

Some may doubt that exposure to such stories would shift the opinions of the well-off. “It is difficult to get a man to understand something,” the writer Upton Sinclair once commented, “when his salary depends on his not understanding it.”

I favour, though, the less cynical view of the Victorian art critic, social reformer and all-round genius John Ruskin, a passionate advocate of the power of sight. Teaching people to read, speak or think was, he believed, of little use if they didn’t know what they were reading, saying or thinking.

The foundation of understanding – its raw material, if you will – was gained by seeing the world around us, with full clarity, observing the bad alongside the good and paying attention to the things we might rather ignore. “To be taught to see,” Ruskin argued, “is to gain word and thought at once, and both true.”

The Spinoff: Labour’s next big task is finding its policy again

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“In politics the middle way is none at all.” John Adams, the second president of the United States, made this argument all the way back in 1776, and the New Zealand Labour Party has recently given it proof. Having, at the election, shorn its platform of most of its distinctively progressive elements, the party was left with a middle-of-the-road manifesto that convinced neither core supporters nor swing voters.

Labour’s woes are, though, just one example of a wider malaise facing political parties the world over, especially on the left. It is almost a cliché in some circles to talk of the “interregnum”, but that is where political parties find themselves: in a world where neoliberalism, however defined, is near-dead, but no coherent political platform has emerged to replace it. 

Nor is there a new intellectual figurehead. The Marxists, famously, had Marx, the Keynesians had Keynes, and the post-1960s “New Right” had Milton Friedman and Friedrich von Hayek. Today there is no one thinker to whom politicians can turn for easy answers or a pre-packaged manifesto. Not that this is necessarily a bad thing: a single source of inspiration can very easily become a single point of failure, an intellectual monoculture. But its absence makes the task of political manifesto-building even harder.

But ideas aren’t all that matter in politics. Just as athletes overvalue strength, and economists over-emphasise financial incentives, political commentators probably exaggerate ideology’s impact. Plenty of good deeds can be driven by basic motives such as a desire to help the vulnerable. But without a clear compass, political parties struggle to understand the exact difficulties a nation faces, select the most promising solutions and, above all, communicate to the public a coherent vision of the path ahead.

Past Labour administrations have generally done just that. Even Helen Clark’s fifth Labour government, modest in its ambitions compared to some of its predecessors, was clear about its plans. Indeed it printed those plans on a piece of paper – 1999’s famous “pledge card” – and distributed them to every household in the land.

Behind those detailed pledges was a concrete programme of political change. Following the “Third Way”, as it was internationally known, Clark pledged to retain a largely “free market” approach but soften its edges. Working for Family tax credits, for instance, would smooth out some income disparities – but the economic power of businesses would not really be challenged.

Clark’s National successors – John Key, Bill English and now Christopher Luxon – have taken a similar line, arguing with remorseless clarity that we first need to grow the economy and then we can all enjoy the health and education services we desire. Discerning an Ardernist or Hipkinite credo would, however, be hard work. The much-touted “kindness” was a worthwhile value but hardly a political programme. Laudable but scattered initiatives like extending sick leave similarly failed to add up to anything coherent. The latest pledge card was overly long, unmemorable, and little-noticed by the public.

The size of Labour’s 2020 victory has almost erased from our collective memory the fact that, in the last poll before Covid arrived, National was ahead and, in conjunction with Act, set to win the election. There was never a strong majority for Labour’s programme – even assuming one could make it out.

Economists like to talk about revealed preferences: the things that, by our actions and purchases, we show we value, as opposed to the things that, in conversations and surveys, we say we value. The last Labour government was very much a revealed-preference government. Ahead of time, its priorities were hard to discern, and it was only when it really dug in on something, such as Three Waters, that people could say, “Oh, so that is a priority. Who knew?”

Speaking of preferences: for the last three years, the left has constantly bewailed Labour’s failure to make use of its extraordinary and absolute majority, claiming that the party squandered a “mandate” for sweeping change. But for what, precisely, did Labour have a mandate? Its 2020 manifesto, presumably – but that document is notably banal. Thrown together amid the Covid chaos, its contents were – I was once told by someone at the heart of that process – essentially just the policies that were so uncontentious within the party that they could be put down on the page without fuss.

Some commentators have claimed that, following the triumph of the initial pandemic response, Labour had a mandate for a kind of activist government not seen since the 1970s. I once argued something of the sort; even National’s pollster, David Farrar, felt New Zealanders had rediscovered their love of the active state. I now wonder if Labour had a mandate for something rather different: competence. 

The initial pandemic response was nothing if not impressively competent: comparatively few people died, and the post-lockdown economy rebounded at pace. The public liked that, and wanted more competent delivery of policies, whatever they might be. (This, as I have noted, is sometimes called valence voting.) The less successful sequel to those events, as is now well-hashed out, saw Labour’s reputation for competence erode rapidly, owing some to the much-discussed slowness of the vaccine rollout and, of course, its failure to deliver on key promises, especially anything complex and infrastructure-related like Auckland light rail.

A favourite saying of Warren Buffett, one of the world’s richest men, is this: “Only when the tide goes out do you learn who has been swimming naked.” Labour’s 2020 Covid-inspired victory was like an immense tide running in, and as it has swept out, the bare backside of the party’s intellectual platform has been cruelly exposed.

In fairness to Labour, leftwing parties all around the world are – as above – struggling in the vacuum of the interregnum. Its British counterpart, for instance, is soaring in the polls, but hews ever-closer to the centre. Its “small target” strategy speaks to a desire to neutralise Conservative attacks rather than any great confidence in a bold new political vision. 

Across the Atlantic, “Bidenomics” is reinvigorating industrial policy, lifting working-class incomes and driving action on climate change – but could well be unseated by a second Trump presidency and has not shifted the dial on ingrained issues like shortfalls in healthcare coverage, police brutality and child poverty. In Australia, Anthony Albanese won power for Labor by explicitly running on a less ambitious programme than his predecessor, Bill Shorten. In Europe, many (though not all) left-wing political parties face similar struggles. (The left is, admittedly, triumphant in much of Latin America, but in situations and political set-ups very different to those which operate in New Zealand.)

None of which is to say that Labour’s time in office has been fruitless. The Zero Carbon Act, albeit largely the work of Greens co-leader James Shaw, has shifted the climate debate forever. But many successes have been achieved sotto voce. Labour put $16bn extra into the welfare system, sharply reducing the number of children going hungry and restoring dignity to beneficiaries’ lives. But it hardly trumpeted this policy, perhaps fearing what would happen if the middle classes found out how much extra money the poor were getting. (In contrast, Bill English raised benefits exactly once, in 2015, and you never heard the end of it.) And although the strategy of incremental, under-the-radar change worked well enough in the benefits system, it abruptly hit a brick wall when it came to co-governance, another policy that Labour didn’t particularly want to defend.

On election night I stopped by the Labour function in Lower Hutt – “party” would be entirely the wrong word, given the generally graveyard-like mood – to hear the immediate postmortems. Perhaps the most perspicacious comment was that although the “policy bonfire” had been a smart move, a sloughing-off of controversial policies often tangential to the party’s mission, the subsequent problem was the failure to replace the torched plans with something better, or indeed anything much at all.

Figuring out what fills the void is the task now facing Labour. As the philosopher G. A. Cohen once said, the job of political parties is to constantly return to their eternal values, and apply them to the present moment. Deceptively simple in theory, but hard in practice. For Labour, those values must surely include old standbys of economic security, solidarity, egalitarianism, and positive liberty – that is, the freedom to achieve one’s goals with the support of others – as well as the newer commitment to respecting the environment.

The nature and value of work will likely be central, too, given that it is literally in the party’s name. That might imply meaningful policy on the colossal modern issue of insecure work, and a greater emphasis on just transitions, as a way to ensure that climate-change-induced economic restructuring does not harm the most vulnerable. But whatever happens, any inquest into Labour’s failure will need to go further than National’s own post-2020 equivalent, which improved matters tactically but also produced “Labour Lite” as far as policy is concerned.

The political analyst Colin James likes to point out that big change in New Zealand comes every 40-50 years: the Liberals creating a skeleton welfare state in the 1890s, the first Labour government fleshing that out in the 1930s and 40s, and the fourth Labour government undoing much of that in the 1980s. On that view, 2017 might have been too soon for radical change; the seismic policy shifts may lie ahead. But if Labour is to lead that charge, it will need, like any successful party, to re-establish its core programme – and stick to it. And that is no small task.

The Post: After the defeat a reckoning must follow

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People of all stripes should feel at least some compassion for the Labour caucus right now: whatever one’s political views, it is not hard to see that such a stinging rejection from the electorate, and the loss of so many colleagues, will hurt people who are, after all, humans like the rest of us.

But Labour must also work to earn that sympathy. That, in turn, requires an honest account of its mistakes in government and how to avoid them next time.

This matters not just ethically but politically, because impressions are quick to set. After Labour’s 2008 loss, National convinced voters that Michael Cullen and Helen Clark had “spent all the money”, even though the pair’s fiscal record was almost immaculate.

It is, admittedly, understandable that ex-ministers are in a foul mood and, in the case of Damien O’Connor, telling a reporter to “f... off”. But not only are such remarks wrong, they risk cementing a perception that Labour is angrier with the world at large than with itself.

The party is of course allowed to point to past victories. The Zero Carbon Act – albeit in large part the work of the Greens’ James Shaw – is an era-defining piece of legislation. Emissions, finally, are falling.

Meanwile some 77,000 children were lifted out of poverty, on one measure, and 13,000 places added to the social housing stock, after years of National neglect. The initial pandemic response was a triumph.

Moreover, and counter to the narrative National spreads, many economic fundamentals are sound. Debt is low (arguably too low), jobs are plentiful, and our GDP growth since Covid arrived has, at 9%, outpaced that of most countries.

Our remaining economic woes have been either, like inflation, largely beyond Labour’s control or, in the case of the trade deficit and poor productivity, problems that long predate its time in government.

Labour can – indeed must – spruik its successes. But it must also own its failures.

The temptation, on losing power, is always to insist that one’s record was spotless. But tread that path and Labour will not be allowed back in office any time soon.

The biggest rat to swallow, but a necessary one, will be to admit that, yes, there was wasteful spending. Consultancy fees spiralled out of control; millions were spent on projects that went nowhere; centralisation – of polytechs and health services, notably – was excessive.

This admission could help regain the trust of voters, who generally accept that mistakes get made and will forgive those who committed them, provided there is honesty – and a clear plan for how to do better next time round.

Labour will need to explain how government can work more efficiently and more effectively. That might involve being both bolder – by setting the “missions” that economist Marianna Mazzucato touts – and humbler, by working more closely with communities, and doing things with them, not to them.

Chris Hipkins and colleagues will also need to do more, and better, policy work in opposition. So much of the drift and vagueness of Labour in government stemmed from its failures out of government. Whence came the almost comical reliance on working groups, taskforces and reviews that marred its early days.

Personnel will be another issue. Does Labour, a party overly staffed with former student politicians and ministerial advisers, still have the connections with the working-class voters it is supposed to represent?

That, in turn, points to perhaps the greatest challenge. Beyond “kindness”, Labour never had much of a governing philosophy, and while the importance of ideology can be overstated in an era where few people follow policies closely, such a lack of clarity ends up costing parties politically.

National’s own message is clear, and has been for years: grow the economy, then you can have the health and education services you desire. John Key and Bill English repeated it like a mantra; so do Christopher Luxon and Nicola Willis.

Labour needs a message that unites the coalition that, at its best, it speaks to and persuades – the working and middle classes combined. It also needs a clear theory of how wealth is generated as well as distributed: what, in other words, a vibrant and flourishing economy looks like.

One part of the puzzle may lie in an idea that Labour has superficially endorsed but never made real: the Just Transition. While climate change renders economic disturbance – and the disappearance of some industries – inevitable, states must – in this worldview – ensure the transition to a new economy doesn’t harm the most vulnerable.

Combining middle-class environmental sensibilities with working-class employment concerns, the Just Transition points parties towards tough climate action but also massive investment in skills and retraining programmes for the newly unemployed. It charts a course towards high-skill, high-wage, climate-friendly incomes.

The phrase “good green jobs” is, of course, a Green Party coinage. But so what? Sometimes something borrowed can become something new

The Post: Action on water use is urgently needed, but what system is fairest?

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Water corrodes, as with rust: but what if putting a price on water is also corrosive? This question lies at the heart of a debate on metering and charging that has taken on renewed force as a hot, dry summer approaches.

Over half of New Zealand households have user-pays water systems: usage is tracked by meters and charged via volume-based bills. Proponents of such systems insist they’re the only viable way to reduce both leaks and excessive water usage. But many areas, including much of my native Wellington, hold out against this trend.

The objections to user-pays typically take two forms. The first concerns economic disparities: when some people have far less money than others, they may be locked out of anything that comes with a price tag.

The other objection centres on “the corrosive tendency of markets”, to quote the philosopher Michael Sandel’s superb book What Money Can’t Buy. “Putting a price on the good things in life,” he warns, “can corrupt them.”

We don’t allow trade in human beings, or body parts, or votes, because we don’t want to treat them as commodities, as instruments of profit and use. People should instead be treated as persons worthy of dignity and respect, voting as a civic responsibility.

So too, arguably, with water. A natural resource, and essential to life, it is something we want everyone to have, as a mark of their citizenship, their basic humanity. User-pays can cut against that.

Some argue everyone already pays for water: if not through user-pays, then through fixed charges. But that’s facile.

Fixed charges embody an entirely different value system. Like taxes, they ensure (or should ensure) that the provision of water is funded collectively, according to what each household can afford to contribute; and from that (literal) pool of collective resources, each takes what they need.

This system, alas, has practical flaws. Most troublingly, it seems unable to fix leaks or restrain water use.

Councils can, and do, send out staff with leak-sensing devices. But it is vastly quicker and more effective, experts say, to have meters placed by tobies, where they can instantly detect leaks both on private properties and in a council’s wider network.

This is an unignorable message in Wellington, where a staggering 40 out of every 100 litres is wasted. Wellington Water could, of course, do a better job of fixing the obvious, surface-level leaks, but many of the biggest are deep underground and – in the absence of meters – likely to remain undetected.

Meters, however, lead inevitably to volume-based charges. That move can be defended, though some of the arguments deployed are – again – of the facile kind.

People only value what they pay for, the reasoning goes. But that would be news to the millions of men who died for their countries in war, or to anyone who loves spending time with their family.

In truth we value all kinds of things that have no monetary charge attached. I know countless Wellingtonians who lovingly conserve water – taking quick showers, putting their washing machine on a short cycle, not running the tap while toothbrushing – even when no fees apply.

The problem, sadly, is that many of their fellow residents remain profligate water users, and seemingly unrepentant: exhortations on billboards don’t stop them washing their car with a hose, or constantly refilling their pool, or running their sprinklers 24/7.

User-pays, though, might well work. The proof? Metered residents of Auckland and Tauranga use an average of 160 and 174 litres per day, respectively; the figures for unmetered Dunedin, Hamilton and Wellington are 212, 224 and 229 litres.

In Kāpiti, usage fell by one-fifth when the council introduced metering; hundreds of leaks were located. Expensive investment in new infrastructure suddenly became unnecessary, and high-volume users paid a greater share of the remaining cost. Charges fell for three-quarters of residents.

I still feel uneasy about user-pays, though, for the reasons Sandel outlines. So I’d only support its extension under certain conditions.

First, there should be exemptions from charges on hardship grounds, no-one should ever have their water supply cut off for non-payment, and larger families – typical in both poorer and multigenerational households – should be eligible for discounts.

Second, I prefer the Christchurch system, where there is a free allocation of water and residents are charged only for use over that amount, to the Kāpiti one, where every drop of water has a dollar sign attached. A free allocation acknowledges the human right to water, the desire not to marketise certain things, while retaining the metering that detects leaks and the charging that catches the biggest users.

Some people would still lose out, perhaps. But there’s no perfect system. And as four-tenths of Wellington’s water continues to be wasted, summer restrictions loom, and even the prospect of long-term shortages hoves into view, the need for action becomes ever more urgent.

The Spinoff: Feeling fatigued and confused by this election? Here’s why

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“Everything must change, so that everything can stay the same.” This line, from Giuseppe Tomasi di Lampedusa’s celebrated novel The Leopard, concerns Italian aristocrats confronting nineteenth-century democracy, but could equally be applied to New Zealand politics in 2023. The stakes seem extra high, and the debates extra ugly, yet the space for meaningful political reform is as small as ever. Feeling confused? Then join us as we psychoanalyse the nation in an attempt to explain why this election feels even more bonkers than usual.

Voters are cross, right?

Yes. For many years, the New Zealand electorate was – in global terms – a sunny outlier, like the one picnicker who hasn’t seen the horde of wolves emerging from the wood. Across several governments since the turn of the century, two-thirds of Kiwis said the country was on the right track, even while such confidence measures collapsed overseas. Now, we have joined the pack. Just one-fifth of us think we’re heading in the right direction. Which makes for some very grumpy voters.

Are they wrong to be grumpy? Everything seems rubbish right now.

When it feels like it costs as much to buy a cauliflower as a house deposit cost your parents in the 1970s, it’s no wonder people feel something is wrong with the world. Especially when large parts of that world are on fire.

We did quite well at Covid, though.

Though certainly not flawless, our Covid-19 response was indeed a global success story: we have had fewer people dying than was expected from pre-2020 mortality trends, and employment and economic growth have rebounded more quickly here than in most comparable countries. Inflation, meanwhile, is a global phenomenon. So it does seem an odd time for the national mood to sour.

The electorate, on the other hand, is notoriously fickle. People may keep voting Labour for decades just because of something Helen Clark once did for their family. Conversely, as one minister recently put it to The Spinoff, they sometimes just “bank” political achievements, as if any party would have handled Covid the same way and the government doesn’t deserve particular credit. See also: the dismal Covid aftermath of rising crime and falling school attendance.

OK, so voters are very cross. Presumably they also want very large change.

You’d think so. But there’s no discernible or consistent groundswell. (Except among farmers. Hah!) Some people obviously do want a shake-up: based on the average of the last seven polls, the two main parties’ vote share is just 64%. Over a quarter of the electorate are voting for Act, Te Pāti Māori or the Greens, all of whom offer visions of substantial change.

As far as the collective mood goes, though, these voting blocs cancel each other out. And Labour and National, far from being lured left or right by their minor allies’ success, are tightly hugging the centre line. Sure, there are sizeable differences between the two – on co-governance and renters’ rights, for instance – but when it comes to big-picture questions about the tax take, the role of government or the delivery of services like health and education, their pitches are pretty similar. Labour now spends $27.8bn more each year than it did in 2017, adjusted for inflation; National wants to pare that back by just $2bn.

Are the main parties missing something about the country’s mood?

Probably not. National, in particular, has a huge war chest (thanks, Rich List donors!), much of which it is spending on focus groups and polls. The big parties know pretty well exactly where median voters are, and that group has not – it seems – shifted decisively on the political spectrum.

So the public wants change … but not necessarily from the left or right. No wonder I find this election confusing.

One possible explanation is that many people are so-called valence voters: the questions that determine their political choices aren’t policy-based (whether, for instance, the private sector play a bigger role in delivering public services) but competence-based (whether, for instance, a politician delivers on their promises, whatever those promises may be). Such voters emphasise qualities like honesty, consistency and accountability over more classically ‘ideological’ values such as liberty or solidarity.

While local research on the subject is scarce, there is strong evidence that many Britons, for instance, are now valence voters. And given the received wisdom about this government’s failure to deliver, and the fact that post-Covid everything feels a bit broken, it would hardly be surprising if New Zealanders simply wanted someone who could – to paraphrase Wayne Brown – get things fixed. Hence the political obsession with either burnishing personal credentials or undermining them: recall Christopher Luxon’s endless references to his CEO background, or the CTU’s attacks on him as being “out of touch”.

There is a circularity to all this: the narrower politics gets ideologically, the more people are left with little other than valence votes. Of course, for those who still see politics as a titanic struggle to realise ideals like freedom and equality, the valence voter, relatively unmoved by such battles, is an unfamiliar beast. Nonetheless it exists. (A quick way to tell if you fit into this category: are you reading this on the policy-heavy, politically committed Spinoff? Then you’re not a valence voter.)

OK, fine. It’s a competence-based election.

Absolutely – at least, that is, until you consider that the person most likely to be holding the balance of power, Winston Peters, is not exactly synonymous with competent government, nor indeed the keeping of promises. His king-making ability is also somewhat baffling to the 94% of people who are not New Zealand First voters.

So we’re back at nothing making sense right now. Maybe it will in future, though.

Maybe. Except that if – as seems likely – National does win, Luxon will probably benefit from an upturn in sentiment based on things he did nothing to deserve. The construction pipeline for state houses is already in the thousands, carbon emissions will likely continue their slight falls of recent years, and the economy is – barring a major world meltdown – set to recover in coming months. All of which are achievements Luxon would happily claim. Fair? Not really. But that’s politics. Don’t you love it?