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Bryce Edwards’ Political Roundup: The illusionary Labour-Green alliance

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Political Roundup by Dr Bryce Edwards. The illusionary Labour-Green alliance

[caption id="attachment_4808" align="alignleft" width="150"]Dr Bryce Edwards. Dr Bryce Edwards.[/caption]

Is it a step forward or backwards? The newly announced Labour-Green alliance is being sold as an important milestone on the way towards the 2017 general election. But rather than creating certainty and clarity about voting options at the next election, the Memorandum of Understanding is rather deceptive. 

Do we really know anything more about what we are voting for if we choose Labour or Greens at the next election? The Memorandum of Understanding has been sold as a big new deal, and a major change in how Labour and the Greens will operate. But because it is actually incredibly limited in scope, with few real commitments for either party, it actually raises more questions than it answers. It could make the electoral landscape more confusing and misleading.

A deceptive MoU

Many commentators have pointed out that the new MoU doesn’t tell us anything new, and lacks any real substance. For instance, Patrick Gower says it’s “purely cosmetic.  It is all about image” – see: The Labour-Green fuzzy-waffle alliance. He points out the limited nature of the agreement, saying that “It means the Labour-Greens can’t say how a Cabinet would work”, and that in reality “the Memorandum of Understanding is designed to be torn up”, especially when Labour comes to negotiate with Winston Peters.

Similarly, Tim Watkin characterises the agreement as “mostly window-dressing” – see: The Opposition dating game

The extremely limited nature of the MoU is also emphasised by Vernon Small: “But the big contradiction inherent in the MOU is the agreement to change the Government and present a real alternative. Trouble is, the MOU expires at the election – not even a few weeks after, as the Mana-Internet party one did in 2014. So at the very point an alternative government is being formed, all bets are off. The certainty of that ‘real alternative’ expires as the votes are counted” – see: Labour-Green deal a tricky juggling act, but on balance a boost for Opposition chances

The New Zealand Herald is quite sceptical about the MoU achieving anything, with its editorial saying, “So what has been agreed, besides the decision to hold a joint press conference and photo opportunity? In the absence of anything more substantial from them, it can only be concluded the occasion was designed to show the two parties are getting along very well these days” – see: Agreement serves dose of reality.

The editorial makes the point that in 20 years of MMP the public has only seen one election that “presented the voters with a pre-conceived coalition”. And that’s a good point – surely voters are better served by political parties being clear about who they would work with after the election. But this agreement is quite the opposite. Labour is still saying that the Green might be cut out of their government, and the Greens are still saying that they might choose National over Labour. This is farcical stuff for voters who want more certainty about what a vote for Labour, the Greens or New Zealand First might mean. People won’t know what they are getting if they vote Labour or the Greens. Do they get a Labour-Green Government? Not necessarily. 

Arguments against pre-election coalitions

In arguing against a commitment to a full pre-election coalition, Labour and the Greens have essentially asserted the need to “let the people speak first”, arguing that it’s not the role of leaders to tell voters what they will do after the election results are in. This has always been Winston Peters’ line, too. 

It’s deeply anti-democratic. It allows voters to be misled and confused about what they are voting for. Democratic principles dictate that parties should be crystal clear about what they would do after an election. And to make matters worse, the parties – and Peters especially – dress up their anti-democratic position in a populist and nonsensical line about letting the “voters speak”. 

Such notions are propounded by Labour’s spin-doctor Rob Salmond, who says “Ultimately the voters deal the cards when they vote, and it’s tricky for a party to play its hand when there’s so much uncertainty over who’ll get which cards” – see his blog post explaining why his party has chosen against a full pre-electoral coalition – see: Labour and the Greens in a tree…

But without a clear pre-election coalition there is public confusion about what personnel and policies are likely to eventuate after election day. On the left, blogger No Right Turn is therefore frustrated that the two parties won’t be clear about spokespeople for the prospective new government: “The other problem is that it is difficult to present as a credible government-in-waiting when you are steadfastly unwilling to talk about who will be filling which Ministerial chair” – see: That alliance

He elaborates on why this is a problem: “We all know that Jonathan Coleman speaks for the government on health, and Hekia Parata on education, but who speaks for Labour-Greens on these issues? Annette King or Kevin Hague? Chris Hipkins or Catherine Delahunty? Who gets what jobs is the sort of thing people judge a potential government on.”

A bolder agreement?

So should Labour and the Greens come up with a bolder commitment to being in government together? Both parties could have gone for a more honest and useful coalition agreement whereby they promise to work in government together after the election. They could say that they are a “left bloc”, and will work to form a government together, along with any other parties that want to participate, including New Zealand First.

Labour and the Greens are obviously wary of the Winston Peters factor. He will want to negotiate without pre-existing agreements, and Labour and the Greens appear to have given into this type of electoral blackmail. 

The left parties would be smarter to establish their commitment to working together after the election, and invite Peters to join them. And he could like it or lump it. For their own sake, Labour and the Greens need to start this narrative at this early stage, saying that they won’t negotiate any notions of cutting the Greens out of government.

The Dominion Post’s verdict on the agreement stresses that the Labour-Greens MoU allows Peters to get his way: “He brags that he won’t be party to any backroom-deals before the election. What this means is that the voters who back him are buying a pig in a poke. Peters will decide the government after the election, presumably on the basis of sheer party-political self-interest, egotism and ambition and all the other unknowable preoccupations of this most exasperating politician” – see the editorial, A Labour-Greens deal is worth trying, but what about Winston?

Likewise, the Greens need to be unequivocal that they would not support or allow a National Government to continue after the next election. At the moment they won’t rule it out – a point made on RNZ by co-leader James Shaw. In fact the Greens co-leaders are reportedly at odds on whether the party might still align with National – see Dan Satherley’s news report and eight-minute video: Greens’ cracks exposed under Paul Henry onslaught

In lieu of Labour and the Greens being more specific and clear about possible post-election arrangements, there will be others who are willing to speculate. Patrick Gower has come up with a very interesting mock-up of the 20-person Labour-NZF-Greens Cabinet that could eventuate – see: The 2017 Labour-Green-NZ First Cabinet.

Enthusiasm for the “Grabour” MoU

Despite the very limited nature of the Labour-Green MoU, there’s been plenty of positivity about the logic of such a deal. Toby Manhire points out its goal of making the opposition less vulnerable to National’s accusations of being a wobbly and unstable vessel – see his column, All aboard the Laboureen. Manhire had, after all, been an original advocate of such an agreement, writing about it in his April column, Time to huddle for next election

He also covers some of the (amusing) social media reactions, and even includes a colourful mock-up logo of the new “Grabour” brand in his Spin-off column, Labour and the Greens get into bed, Winston prepares his pyjamas, and other bad metaphors

[EDITOR’S NOTE: Also, Toby Manhire, Selwyn Manning, and Kevin Milne took a favourable view on Radio New Zealand’s Panel with Jim Mora.

ALSO: on EveningReport.nz Selwyn Manning argued in his Across the Ditch bulletin on Australia radio FiveAA: “If at the 2017 General Election the Labour-Green bloc attracted a higher percentage of support than the National Party, then, Winston Peters may just consider the merits of a black-red-green government.”]

Martyn Bradbury has had some criticisms – suggesting, for example that the more colourful title of “The People’s Revolutionary Grand Alliance” should have been used – but mostly celebrates the major impact the MoU could have on how the media and public understand the electoral race. He also argues that the new alliance could have a vital impact in electorates such as Ohariu, Auckland Central, and Waiariki – see: How the Labour Green MoU wins the 2017 election

You can also watch Bradbury’s 27-minute discussion about the deal from last night with Laila Harre, Robert Reid, Wayne Hope, Keith Locke and myself – see his Waatea 5th Estate TV programme, Left Wing Jedi Council debate the Labour-Green MoU

Who wins from the new alliance?

There are plenty of different verdicts on which politicians and parties benefit or lose from the new MoU. Claire Trevett suggests that “Labour may also effectively have handed the 2017 election to National on a platter” – see: Labour-Green Party deal a historic agreement, but who wins?

The Greens – and the environment – are the losers according to Rachel Smalley, who argues that New Zealand needs a green party in the centre of the political spectrum – see: The Greens should be prepared to work with both the left and the right.

Others say that Labour loses from the agreement, and it represents Andrew Little’s desperation. For example, Chris Trotter lists his problems with the deal: “the Labour and Green parties have announced their new “Understanding” far too soon; without preparing the electorate or priming the news media; without securing real and valuable gains for both partners; without carefully gauging the reaction of both their members and their voters; and without having straightforward answers to journalists’ straightforward (and entirely predictable) questions” – see his blog post, Unconvinced: Why Chris Trotter Is So Sceptical About The Labour-Green “Understanding”

And Matthew Hooton, writing in the NBR today, says the MoU represents a major loss for Labour, with a boost for the Greens. In his paywalled column, Peters biggest winner from red-green pact, Hooton says that in making the deal, “Little was publicly acknowledging that there will never again be a Labour-dominated government in the mould of the Clark, Lange, Fraser or Savage regimes.” 

Hooton lays out the problems for Labour in the deal: “the pact has at least five likely electoral effects, all of them disadvantageous to Labour.  It licenses left-wing Labour voters to tick Green, drives centrist Labour voters to National, prevents centrist National voters from crossing over to Labour, sends a few Green-voting Remuera doctors’ wives back to National, yet solidifies the vast bulk of the Greens’ existing support by eliminating fears the Greens could coalesce with National. Labour is also now at risk of losing MPs from what could be called its Shane Jones faction to NZ First.  The Greens can anticipate a net increase in their polling, as can National, but the pact is all downside for Labour.”

There’s been a lot of speculation about how the MoU could lead to electoral deals that change the political landscape in key marginal seats, especially the Ohariu seat – see, for example, Dan Satherley’s Does the Labour-Greens alliance spell doom for Peter Dunne? But such a scenario seems unlikely, as David Farrar points out in his blog post, Will Labour not stand in Ohariu?

Finally, for satire on the strange agreement that didn’t really change anything, see Andrew Gunn’s The leaked Labour/Greens pre-nup

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Across the Ditch: Greens + Labour Announce Engagement But Can They Do It? + Dodgy Auckland House Sells For $1.1 million

Across the Ditch: Australian radio FiveAA.com.au’s Peter Godfrey and EveningReport.nz’s Selwyn Manning deliver this week’s Across the Ditch and discuss: Politics with the Labour and Green parties announcing a MOU that they will campaign as a pre-election coalition to kick the Nationals out of Government in 2017. Also discussed was how a dodgy Auckland house sold for $1.136 million, despite it having been tested for methamphetamine and with tests actually showing it had elevated levels of lead contamination. Recorded live on 2/06/16.

* Round up of the morning’s main headlines.

ITEM ONE

New Zealand Labour  and the Green parties have signed a memorandum of understanding that they will work as partners to get rid of the Nationals from Government at the 2017 general election. In essence it is New Zealand’s centre-left version of how Australia’s centre-right parties position themselves when campaigning to become the government.

In NZ, the centre-left is fragmented with NZ Labour attracting percentage support ranging from the mid 20s (at the 2014 General Election) to the low 30s as shown in this recent Newshub/Reid Poll. The Greens poll just above 11 percent. Together they attract a respectable vote, almost… just almost on par with the National Party, that the Newshub/Reid suggested hovered around 47 percent.

This Red-Green political de facto marriage presents a legitimate claim to develop policies under a Government-in-Waiting umbrella.

BUT… to become government in 2017, both… the Labour-Green bloc (and the incumbent National Party) need the support of the centrist and nationalistic New Zealand First party, and its leader Winston Peters.

So which way would Winston Peters swing?

If… if at the 2017 General Election the Labour-Green bloc attracted a higher percentage of support than the National Party… then, Winston Peters may just consider the merits of a black-red-green government.

But if the National Party maintains its supremacy (even if by just a percentage point of the popular vote/party vote), then Peters may insist that the people have spoken and assist John Key to enjoy the spoils of a fourth term in Government.

Interesting times.

ITEM TWO

Auckland’s average home sale price is on target to pass the $1 million ceiling within a year. And some fairly dilapidated houses are already selling for over $1 million… Like this train-wreck of a house, that has some walls missing and was tested for methamphetamine contamination, and discovered to have elevated lead levels.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11648953

Across the Ditch broadcasts live on Australia’s FiveAA.com.au and webcasts on EveningReport.nz, LiveNews.co.nz, and foreignaffairs.co.nz.

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Keith Rankin’s Chart for this Month: The World’s Most Prosperous Countries

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Analysis by Keith Rankin.

[caption id="attachment_10398" align="aligncenter" width="977"]Economic League Table. Economic League Table.[/caption]

The most common way to represent a country’s prosperity is through Gross Domestic Product (GDP) per capita. While this measure has its limitations – mostly arising from differences in inequality – it remains an important measure of comparative economics.

The $US measure of GDP (blue) tells us the value per person of marketed output priced in the world’s reserve currency. The $International measure (black) – using ‘purchasing power parities’ – tells us what that countries marketed output would buy, on an average per capita basis.

The countries where the $US measure is greater than the $Int measure are countries that travellers would regard as ‘expensive, such as Switzerland and Norway. On the other hand, countries for which the $Int is higher have relatively low domestic prices.

The table excludes four countries with populations below one million: Luxembourg, Macao, Iceland and San Marino. Being very small, these countries tend to have (or have had) specialisations relating to areas of international business and finance which, when divided by their low populations, artificially boost their GDP per capita statistics. The table also excludes some other countries ranked above New Zealand on the international dollar measure: Brunei (which has less than one million people), Saudi Arabia, Bahrain, Taiwan, Oman, Puerto Rico, and South Korea.

There are many points of interest in this chart, not least the dominance of Qatar and other small countries. On the international dollar rankings, the top seven countries are all small countries with specialisations in oil or business/financial services. The United States is 8th on the chart.

For European Union (EU) countries, those in the Euro Area (except Finland) have higher international dollar values whereas non-Euro EU countries have higher $US values. This reflects the substantial deflationary pressures in place in the Euro Area.

Of particular interest is Ireland, which (ignoring little Luxembourg), comes out top of the Euro Area, top of the EU on the purchasing power ($Int) measure, and second top (after Denmark) on the $US measure. This seems hardly credible as a measure of typical living standards in Ireland, a country with the same population as New Zealand, a large emigrant labour force, unemployment (albeit falling) at eight percent, and deflation. As my previous Chart for this Month suggested, Ireland’s national accounts reflect that country’s position as an overt facilitator of trans-national corporate tax avoidance.

By the purchasing power measure of living standards ($Int GDP pc), New Zealand comes in at 28th (33rd if you include the rich little countries included in the IMF statistics – many of the tax haven countries, including those in the British Isles such as Jersey, are not covered by the IMF), well below Australia at 14th. Arguably the most prosperous country in the world 150 years ago, and very much in the top ten 50 years ago, New Zealand hangs in there, with average living standards comparable to Pacific Rim neighbours Japan, Korea and Taiwan.

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NewsRoom_Digest for May 26 2016

NewsroomPlus.com image

For Budget Day we have a one-stop page for releases at http://newsroom.co.nz/categories/budget

Today’s edition of NewsRoom_Digest features 2 resourceful links of the day and the politics pulse from Thursday 26th of May. It is best viewed on a desktop screen.

NEWSROOM_MONITOR 

Noteworthy stories in the current news cycle include: the Finance Minister Bill English delivering his seventh Budget at Parliament; dairy giant Fonterra announcing an increased milk solid price of $4.25 per kg, slightly below the $4.50 – $4.80 analysts predicted for the upcoming season; and the country’s power grid operator, Transpower predicting a massive shake-up in the electricity sector, including the failure of some line companies. 

POLITICS PULSE

Government: Housing momentum to be maintained; Criminals hit by billion-dollar hole in pocket; Bowel screening programme roll-out; $36m for warmer, healthier homes;Health investment increases to a record $16.1b;$2.1b investment in public infrastructure; $652.1m Social Investment for vulnerable NZers;Govt books show rising surpluses, falling debt;Govt books show rising surpluses, falling debt;Budget 2016: Overview;Investing in a growing economy;Budget supports growing economy;ETS one-for-two subsidy to be phased out$882.5m investment in school property; $96m for legal aid and community law centres;Government invests in New Zealand’s security;$258m to boost social housing; $208m investment boost for Justice;$357.9m invested in key transport projects;Annual education investment to exceed $11b; Budget 2016: $32m extra for Bay of Plenty DHB; $100m boost to develop Auckland housing;Extra support for most at-risk students;New $100m fund to improve water quality; Financial help boosted for low-income earners; $111.5m to support NZers into employment; $347.8m for care and protection of young people; $299.2m in additional funding for Police; $16m new funding to tackle wilding conifers; Extra $19.7m for Crown prosecutions;Minister supporting Greater Christchurch Regeneration;$69.8m towards eliminating bovine TB;Defence Force receives $300.9m new funding;$761.4m for an Innovative New Zealand; Additional Budget support for Pacific peoples; Tobacco excise to rise 10 per cent per annum; $857m to deliver a modern tax system; $11.6m new funding for the arts; $49m to strengthen Whānau-centred services;Extra $6.2m to increase Civil Defence capability; Low-risk travellers streamlined at the border; SPEECH: Hekia Parata – Shifting the Levers of Education

ACT Party: The biggest thing that’s not in the Budget;Budget 2016 splashes out on fat corporate welfare cheques; Budget increases taxes on those in need

Greens: Will National’s eighth budget finally show some vision today?; Green Party Co-leader James Shaw’s 2016 Budget Speech: Time to change the Government; Budget cuts continue National’s miserly underfunding of DOC; Shock school funding freeze means parents pay more

Labour:Fall in Police investigations funding must be fixed; Minister won’t fess up on wrong figures; Labour Bill Would Back Kiwi Jobs;John Key fails middle New Zealand with no fix for housing crisis, more underfunding of health;Sticking Plaster Budget fails the test

Māori Party: $40m boost for Whānau Ora;$4m for extending micro-financing;$17.9m to support Māori landowners;$5m to promote Māori voter participation; Māori Party Continues To Support Housing Solutions; $34.6m to support te reo Māori revival; $4m to commemorate New Zealand Wars

New Zealand First:Bennett Resettles Homeless In Jobless Towns;Address in Reply: Budget 2016;National tells many NZers to ‘get stuffed’; Budget 2016: Bowel Screening Programme Far Too Little, Far Too Late

NZ National Party:Budget 2016 a big boost for Technology Valley

United Future Party:Dunne calls for 52 weeks of parental leave; More Funding For Intelligence Services Must Come At A Price; A Boring Budget That Identifies The Right Targets

LINKS OF THE DAY

BUDGET 2016: Budget for the Government of New Zealand was announced today.More details at:http://www.treasury.govt.nz/budget/2016

RBNZ LIQUIDITY MANAGEMENT: The Reserve Bank today published a Bulletin article that explains how the Bank manages liquidity in the banking system. Effective management of liquidity plays a crucial role in New Zealand’s banking system. Read more: http://www.rbnz.govt.nz/research-and-publications/reserve-bank-bulletin/2016/rbb2016-79-09

And that’s our sampling of “news you can use” for Thursday 26th of May.

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