Keith Rankin, 21 May 2026 – In 2026, a number of countries desperately need one or two circuit-breakers to trigger an increase in aggregate demand; an increase in spending which can induce both consumer spending and business confidence.

Keynesian economics tells us that the most reliable circuit-breakers are exports and government spending. New Zealand’s exports are booming, and have been for a while. But for New Zealand that’s still far from enough; New Zealand needs a government spending circuit breaker as well.

The United States last year sought to bully the world into buying more American goods. But that hasn’t been a circuit breaker for the United States (but it really boosted China’s trade with other countries), just as Roosevelt’s ‘New Deal’ of the mid-late-1930s was not enough. In that era, the final and successful circuit-breaker was American armament, in 1940 and 1941; armament in support of the United Kingdom in its war against Nazi Germany and also to prepare itself for a possible entry into war against Germany and/or Japan.

From 2023 to 2026, the United States economy is back into a growth phase, dramatically so this year; it’s Keynesian circuit-breaker has – once again – been armament for war. War production in support of others – including Ukraine and Israel – and war production in support of its own foreign adventures. Further, war has proved, literally, to be the killer application which makes AI (artificial intelligence) profitable.

The New Zealand Government this week, seemingly far from producing a circuit-breaking stimulus, has just announced a policy to retrench the public service. (Refer Scoop, Government plans to cut 8700 public service jobs over three years, 19 May 2026.) At first sight, it looks like Déjà vu, all over again; a quick exit to political ignominy for a failed government determined to not learn from the past.

Retrenchment in New Zealand’s past

What in the past was generally called ‘retrenchment’ is today, euphemistically, called ‘fiscal consolidation’. The worst two retrenching Ministers of Finance have been William Downie Stewart Jr., and Ruth Richardson. (Roger Douglas converted to that doctrine, but didn’t practice it to anything like the extent that Ruth Richardson did. Douglas and Richardson subsequently became principals of the ACT Party.)

During the second half of the twentieth century, it was well understood by most bureaucrats and relevant academics that the core political misdemeanour which converted the 1929 global financial crisis into a global Great Depression was government retrenchment.

Retrenchment was a ‘race-to-the-bottom’ policy whereby governments would undermine their own revenue bases in a misframed and impossible quest to ‘balance the Budget’. Undermining the revenue base through spending reductions at a time of already-low consumer and business confidence and already-growing unemployment could only be the height of fiscal folly. In the years from 1926 to 1933, New Zealand had a Minister of Finance who twice brought New Zealand to its economic knees through his ardent and ideological commitment to retrenchment; to a policy supposedly about reducing the size of government, but which actually achieved bigger size reductions to the private sector.

The global crisis around 1931 and 1932 was particularly bad, because the simultaneous retrenchment of almost all capitalist governments had the particularly discouraging effect of collapsing world trade. Government retrenchments and reduced spending on traded goods reinforced each other, creating a particularly problematic downward spiral.

William Downie Stewart Jr was Finance Minister from 24 May 1926 to 10 December 1928, and again from 22 September 1931 to 28 January 1933. During both of those comparatively short tenures, Stewart effectively waged fiscal war on the country. His first tenure as finance minister ended with an ignominious ousting of the Government which indulged his constipatory policies. The second stint ended with an internal putsch of sorts in January 1933 (a dispute around the issue of currency devaluation); a coup driven, ironically, by the man (Gordon Coates) who had been Prime Minister in the 1925 to 1928 government. (In both cases, the economy ‘turned the corner’ after the riddance of Stewart; though it took several years after 1933 to fully recover, meaning that the then proto-National government – led by the hapless George Forbes – was unceremoniously dumped in the 1935 election.)

In like vein, I think we can say that Ruth Richardson was the deserved victim of an internal putsch – a removal that was too slow, though, given that she was still able to do damage in 1994 – instigated by Bill Birch and Jim Bolger. In terms of the popular vote, in the 1993 election, the Left (deservedly trounced in 1990) thumped the Right. If that election had been held under MMP, the result would have been a landslide defeat for a one-term National Government.

Back to the Future

2026 is the future, as seen from 1933 and 1993. Indeed, the framed retrenchment undertaken this week by Willis and Luxon has optics similar to those of 1927, 1932, and 1991. But the then ‘future’ – ie today’s present – is different; subtly but importantly different.

Politically, Ms Willis and Mr Luxon are under pressure from the Treasury, from the New York credit-rating agencies, from David Seymour of the coalition’s Act Party, and from the whiney (but economically sub-literate) journalists whose first question is inevitably “where’s the money coming from?”.

Sending public servants down the road – and replacing them with bots – may be good optics for this kind of staunch masculine fiscal politics. But, to get re-elected, the government needs the circuit-breaker mentioned above. In economies, as in prostate science, flow works better than constriction.

So, what has the Government announced? Ahead of next week’s Budget, they have committed to more than a billion dollars of extra spending. That may be the circuit breaker. Here’s the crux of Nicola Willis’ announcement: “Over the next four years these initiatives will deliver savings of $2.4b which will be re-deployed“. Re-deployed when? In 2026, of course! (That is, predeployed rather than redeployed.)

Where will the money come from? From the public service retrenchment promised for 2027 to 2029. The promised retrenchment is in effect collateral for a loan to be drawn down this year, indeed this month. Based upon my reading, the announced public service disemployment probably won’t even happen; it’s like unmined gold used as collateral – alleged gold that will probably remain in the ground.

Labour, if returned to power in November, will almost certainly cancel National’s public servant retrenchment ‘plan’. And National, if returned to power, may simply move on to other policies and conjuring tricks; journalists are so easily distracted by political sleight-of-hand. Money, as always, is an illusion; a set of circulating promises.

Here’s hoping I’m correct; that this fiscal predeployment does represent a long-awaited expenditure stimulus.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 20 May 2026 – Recently, the New Zealand First Party released its KiwiSaver policy, promising to make this retirement savings scheme compulsory for New Zealand born citizens, and setting them up with a $1,000 startup deposit at birth. (See Winston Peters unveils KiwiSaver-from-birth NZ First policy, bank takeover plan, Scoop, 18 May 2016.)

The New Zealand First Party also promised that no government which they are a part of will be allowed to raise (from 65) the age of entitlement to New Zealand Superannuation, which is New Zealand’s universal pension. The National Party, on the other hand, plans to campaign on a promise to raise that age of entitlement. What National did not confirm or deny, is whether it will raise the age of entitlement for KiwiSaver.

I cannot imagine the age for KiwiSaver entitlement staying at 65 – what today is loosely called the ‘retirement age’ – while the age of pension entitlement is raised to 67 or higher. Requiring people to wait until they are 67 before they can access their retirement savings may prove to be even more unpopular than raising the pension-entitlement age.

But, back to Peters’ KiwiSaver startup plan.

In the last 24 hours I have heard references on RNZ (publicity excerpt from The Panel) and on Stuff News (TV3) to such start-up retirement savings. And how we can all become retirement millionaires on the basis of ‘the miracle of compound interest’.

The RNZ item considered a savings plan – at five percent interest – commencing at age 18, which would result in a lump-sum at 65 of well over a million dollars.

The TV3 item (This KiwiSaver change could give Kiwis a $53,000 retirement boost. It’s gaining high-profile support across the political divide, Damien Venuto, 19 May 2026) goes like this: “If $1000 was invested into an aggressive account for a New Zealander from birth that would compound to $53,000 by the age of 65 even if nothing else was invested. The one disclaimer here is that inflation will eat into that over time, making the buying power of that $53,000 far lower than what it would be in today’s terms.”

Two Examples of ‘Miracle’ KiwiSaver savings

In my first example, I start with $1,000, and put that aside in a ‘conservative account’ which we expect to yield five percent interest per annum. The result, after 65 years (daily compounding), is $20,081. That’s assuming tax-free interest. To get to $20,000 while paying withholding taxes, a gross interest rate – gross yield – of about seven percent would be required.

In the second example, I go for Damien Venuto’s target: $53,000. You would need a net annual yield of 6.62 percent. Venuto claims that this is possible in an “aggressive account”. We note Venuto’s inflation proviso, though clearly Venuto presumes that average inflation over the next 65 years will be well under 6.62 percent.

(Given that inflation compounds in the same way as savings’ deposits do, we can say that, if inflation averages five percent over those 65 years, our savers at birth would end up multiplying their birth ‘investments’ by a factor of 2.65; meaning that, after correcting for inflation, their $1,000 seed deposit becomes $2,650. However, if inflation averages 2.95 percent, the $1,000 starter rises to $9,000 after adjusting for inflation. My best guess is that inflation over the next 65 years will average over ten percent, given both the present state of the world and the demands on goods and services which will arise from baby boomers and Gen-Xers eventually cashing in their private pensions. At ten percent average inflation, the initial $1,000 would be worth just $132 in 65 years’ time.)

Risk and Uncertainty.

If you are looking for a risk-free Saver account, you should be expecting a gross interest rate of about the rate of inflation; that means a net interest rate below the rate of inflation. Otherwise, you have to accept risk (estimable) and uncertainty (unknown unknowns can be predicted, at best, with intelligent guesswork).

If you transport yourself back to 1961 (New Zealand’s year of maximum births, 65 years ago) and try to guess your way to the year 2026, what inflation, yields, and risks would you have predicted?

(Inflation has compounded since then at an annual average rate of 5.3%. $1000 saved in 1961 would have to have compounded to $29,400 in 2026 just to break even. Money passively – yet ‘aggressively’, in Damien Venuto’s sense – ‘invested’ in shares or property would have achieved an excellent long-run return, however. Money in a savings account would have fallen well short of break-even. It’s highly unlikely that the next 65 years will be as favourable as the last 65 years were. What actually happened in the last 65 years was not necessarily the best prediction; you might win a game of roulette, but the best prediction is that you will lose. In 1961, most people would have predicted some kind of nuclear war by 2026; indeed, with hindsight, the chances of such a war in 1962 may have been as high as 50:50.)

In an ‘aggressive account’, there are many associated risks. The essential difficulty relates to the fact that the returns are principally capital gains, which may or may not occur, and may or may not be taxed.

Capital gains are largely self-fulfilling in economies with a high degree of inequality, because those people with lots of money tend to use it to buy and sell financial assets from and to each other, boosting the prices of those assets in a financial merry-go-round. This situation can go on for a long time, though never forever. The break happens when more than a few people want to cash in their inflated financial assets at the same time; and such ‘corrections’ are almost certain to happen with rapidly aging (‘first world’) populations in the ‘global north’. After all, much of this money is in pension funds and sovereign wealth funds, which are both going to come under extreme pressure when those older persons seek to spend their savings (and require more services); savings which individual savers cannot take to the grave. And, while sovereign nations may not have an imminent grave, their Treasuries have certain expenditure obligations towards their aging populations, and towards the younger people struggling to support the older people.

While investment yields can be real, capital gains by their very nature are largely illusory, dependent on most of the ‘invested’ funds not being withdrawn. These financial assets will largely disappear in the event of another ‘levelling event’, such as the Great World War of 1914 to 1945; noting that that event included the Great Depression, part of the levelling process.

Who Pays the Interest?

Whenever we hear about the magic of compound interest, we hear very little about who pays that interest. Let’s start with a static, non-growing economy. This may be called the ‘zero-sum’ case.

In such an economy, interest (unless the interest rate is negative) represents an unrequited flow of money from debtors to creditors. In the twentieth century world, when it wasn’t at war, that largely meant from private businesses investing in growth to private savers ‘investing’ in financial assets. Governments tended towards balanced budgets from 1950 to 2000, so were more on the financial sidelines than they are today.

In the twenty-first century world, the debtors are mainly small businesses, relatively poor households, and governments. (In some but not all cases, the same governments which have trillion-dollar sovereign wealth funds.) There are other situations, especially around large leveraged ‘investments’, where interest is paid by the very rich to the very rich; these situations ‘net out’, so can be ignored when looking for the big picture around systemic interest flows.

Once netted out, the main flows of interest today are from small and medium size businesses and relatively poor households to the richest ten to fifteen percent of households. Interest flows from poorer households to richer households. And from younger households to older households. Further, dwelling rents constitute a form of interest; they represent a yield paid to landlords by tenants. The words ‘interest’ and ‘yield’ are close synonyms.

What this tells us is that it’s impossible for all of us to benefit from the ‘miracle of compound interest’. Every dollar of interest received must be paid by someone. It also tells us that one of the risks associated with the miracle is the possible default – or bankruptcy – of a smaller or larger proportion of interest payers.

An interesting finding in New Zealand in the late-2000s, when finance companies were going broke, was that there were actually two types of finance company. One was mainly financing property investments, and the interest payers were relatively affluent people. This type of finance company – eg Hanover – failed during or prior to the global financial crisis (GFC) of 2008 to 2009. The second type of finance company were funding distress loans to the poor; they continued to thrive through the GFC. The poor struggle on, conscientiously.

Looking at this second type of finance company, we can see the emergence of a new ‘lower working class’ – many of them denizens rather than citizens of the countries they live and work in – who may be considered to be ‘debt slaves’ or something close to it. In that sense, the lucky Kiwi Savers are enjoying their credit miracle (in the cases when that miracle is not a mirage) at the expense of a global proletariat of debt slaves.

Now consider economic growth, real and nominal. Real economic growth is the ‘positive-sum’ case.

The standard growth story about ‘who pays the interest’, is that the savings are’invested’ in businesses that are creating economic growth. In this story the creditor ‘passive investors’ – the Kiwi Savers – and the debtor ‘active investors’ (small, medium and large businesses) are both receiving the yields arising from the societal process of economic growth. The yields are the increased amounts of goods and services made available through the growth process.

That’s real growth; indeed, exponential real growth. However, high-paced real growth can never go on forever. Eventually – later or sooner – it must crush the planet through depletion, waste, and (probably) the ‘laying waste’ of warfare.

If we don’t have indefinite real growth, we return to the ‘zero-sum’ case discussed above.

Now consider the forms of the nominal economic growth case. This is when apparent economic growth turns out to be inflation. This is benign compared to the zero-sum case outlined above, because inflation erodes both debts and savings. So, it means that the flows of interest from the poorer debtor community to the richer creditor community become sustainable, because these flows are always being ameliorated by inflation.

In the extreme form, the nominal economic growth case is a zero-sum case, because there is no real economic growth. In a less extreme form, there is a mix of some real growth and some inflation. This is probably the optimum. Modest real economic growth is sustainable if it does not intensely use non-renewable resources. And some inflation addresses the debtor-creditor inequity that the miracle of compound interest is predicated on.

In this relatively optimal case, interest rates will on average be approximately equal to the inflation rate. So the miracle of compound interest disappears. If interest approximately equals inflation, then $1,000 today will buy approximately the same amount of stuff in 65 years’ time. And that’s what should happen; we should save when we have a relatively high income, and withdraw our savings when we have a relatively low income. No interest, on balance. We should not kid ourselves that simply sitting on a nest-egg of magic money is going to make us fabulously rich!

Finally

There is another case where the debtor-creditor relationship becomes too exploitative, and when that broken relationship induces socio-economic breakdown. The result is a negative-sum game, whereby everyone – or just about everyone – loses.

Anyone trying to play the compound interest miracle game should understand that they are trying to get something for nothing; that they are playing the role of ‘exploiter’. Capitalism as we know it is a game of exploitation; indeed, low levels of ongoing exploitation can be sustainable.

Under our present order, of liberal private capitalism, the best possible option is a mix of low inflation and low sustainable growth based on renewable resources and accumulation of benign knowledge. Keeping this balance is a bit of a tight-rope walk. Today too many of us have slipped on the rope, and are hanging by our fingers. The more people who slip, the more the tight-rope wobbles, leading ever more people to slip in their wake.

There is a better capitalist order; a more democratic more sustainable form of capitalism which fully incorporates public equity – public property rights alongside private property rights – with appropriate public equity dividends to stem the growth of income inequality. This is consistent with a balanced mix of sustainable growth and sustainable inflation. It is not consistent with interest-rate exploitation.

In the meantime, why do we look kindly upon compound interest alchemists while lampooning conspiracy theorists? The worst offenders in both groups are equally bogus.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

The eighth floor of the Tempo building in Jakarta became the setting for a gathering rich with meaning.

What brought together community leaders, politicians, academics, religious figures, journalists, and the family of the late Thom Beanal was not merely a book launch. It was an earnest attempt to revisit the essence of struggle, leadership, and hope for the land of Papua.

The event, which took the form of a discussion and review of a three-volume book series on Thom Beanal, opened with greetings in multiple traditions — from an Amungme war cry to salutations representing all major tribes in Papua.

That gesture alone reflected the very spirit of the man being honoured: a leader who embraced diversity and respected every single man and woman.

The gathering coincided with three historic moments, making it even more significant.

First, it marked exactly 27 years since Thom Beanal, standing before President B. J. Habibie, boldly expressed the heartfelt desire of his people. With courage and clarity, he called for recognition as a nation that wanted to cooperate honestly, peacefully, and democratically.

Second, the event served as a memorial, three years after Beanal’s passing — a man who left a deep imprint on the struggle of Indigenous Papuans.

Third, it celebrated the culmination of two years of work by a writing team, resulting in a trilogy that chronicles the journey of a lay pastor, a tribal chief, and what many now call a “father” to the indigenous Papuan.

From lay pastor to Indigenous defender
Thom Beanal was no ordinary leader. Born on 11 July 1947 into the Amungme tribe in Timika, he completed his education from primary school to a Catholic theological academy, then served as a catechist teacher in Wamena and Paniai and as a lay pastor in several parishes.

Yet behind his calming smile and disciplined demeanour lay a profoundly thoughtful mind.

Witnessing firsthand the human rights abuses and ecological destruction caused by PT Freeport Indonesia, Beanal resigned from his pastoral duties. He felt a more urgent calling: to defend indigenous communities whose lands and lives were being uprooted.

In 1994, he founded LEMASA, the Amungme Traditional Deliberative Council, as a vehicle for indigenous advocacy. Two years later, he took an audacious step — suing Freeport in a New Orleans court. That legal action set a precedent: for the first time, a Papuan had dared to take on a multinational giant on foreign soil.

His fight did not stop there. Beanal went on to push for a one percent allocation of mining revenue for affected communities. Although limited in scope, that achievement brought a measure of justice to people who, for decades, had borne the negative impacts of mining without enjoying the wealth of their own land.

Reform era and a unique role
Entering the reform era, Beanal’s role expanded. Together with other Papuan figures and students, he helped establish FORERI, a forum that channelled Papuan aspirations during the early wave of reform.

When the Papuan Council (Dewan Papua) was formed in 2000, he served as its vice chairman. He later became chairman of the Papuan Traditional Council from 2002 to 2007. Remarkably, President Abdurrahman Wahid — known as Gus Dur, a leader with genuine concern for justice in Papua — appointed Beanal as a commissioner of PT Freeport Indonesia.

Serving until 2018, Beanal found himself in a unique position: an indigenous rights fighter sitting on the board of the very company he had long opposed.

Yet despite those strategic roles, speakers at the book launch event described Thom Beanal as a humble man, disciplined and rich in metaphor. He never offered instant answers.

Instead, he opened spaces for collective reason to search for truth. In every balance of history, he arrived precisely when the Papuan people were not in a good state. And sadly, three years after his passing, the reality facing Papua remains far from encouraging.

A grim reality for Papua today
The presentations at the Tempo building painted a grim picture. Terms like genocide, ecocide, and ethnocide were mentioned as ongoing threats to Indigenous life. Papua’s gold and other natural resources, it was argued, remain mortgaged until 2061 under a contract deemed uncivilised because it ignores the basic rights of the customary landowners.

Suffering, the speakers said, is still the daily bread of Papuans. It is against this backdrop that the three books on Thom Beanal were written — not to lament the past, but to read the present clearly and to weave solutions for the future.

The 47 contributors to the third volume, divided into six sections, provided reflections and testimonies that enrich the books. They came from diverse backgrounds: family members, prominent figures of the Amungme tribe, academics, activists, and religious leaders.

The head of the writing team, Markus Haluk, expressed his highest appreciation to everyone who supported the two year process. Moral support and advice from religious, traditional, and political leaders were cited as a key source of strength.

Special thanks were directed to the book’s reviewers, including Dr Budi Hernawan, Dr Suraya Afiff, Yorrys Raweyai, Inayah Wahid, and Emanuel Gobay, for their critical engagement with the content.

Six strategic demands for the future
More than a launch, the event became a platform for six strategic recommendations and hopes. First, the books should serve as historical source material and references for young Papuans and the wider public. The concern that the struggles of national figures might vanish with time underscores why documentation and dissemination are so urgent.

Without conscious efforts to write and spread the stories of past heroes, dark chapters could repeat, and the sacrifices of predecessors might become meaningless.

Second, the book launch was not meant to be a time for complaining or blaming one another. Instead, it is time to speak honestly about Papua’s current realities and then collectively formulate comprehensive, strategic solutions.

This constructive mindset is a legacy of Beanal’s way of thinking — seeing problems as challenges to be solved, not excuses for despair.

Third, participants were called to continue the prophetic voice exemplified by several great figures. Mentioned were bishops such as Monsignor Staverman, Monsignor Monninghoff, Monsignor Laba Ladjar, Monsignor John Philip Saklil, Father Neles Tebay, Monsignor Yanuarius You, and Monsignor Bernardus Baru OSA.

Among executive leaders, two presidents known for their deep concern for Papua — B. J. Habibie and Gus Dur — were hailed as models of dignified, peaceful struggle. The goal is noble: to save the people, culture, and natural world of Papua, which remains the last remaining lung of the Asia Pacific region. Achieving this requires genuine solidarity across sectors and religions.

Fourth, a firm call was directed at the Indonesian government, especially President Prabowo Subianto and relevant ministers: stop the mortgaging of Papua’s natural wealth, stop the gold theft, and stop the destruction of the universe that is the Papuan people’s home.

The contract binding Papua until 2061 is seen as a form of structural injustice that must be corrected. Rejection of all forms of natural resource pledging for the benefit of a few — especially to foreign parties — was voiced loudly before dozens of attendees.

Fifth, recognition of and respect for the rights of the Papuan people over politics, land, natural resources, and human dignity are non negotiable demands. The threats of genocide, ethnocide, and structural violence must be halted immediately. The absence of genuine recognition of these basic rights has been the root of decades of conflict and suffering in the land of Papua.

Sixth, and perhaps most fundamental, is the call to build honest, peaceful, and democratic negotiations between the Papuan people and the Indonesian government. This is not a new idea. It is precisely what Thom Beanal himself voiced when he stood at the State Palace on 26 February 1999.

He laid before the president the sincere desire of his people, offering equal dialogue based on honesty and peace. Twenty seven years later, the same call must be repeated — proof that a massive homework assignment still lies before the Indonesian government.

Continuing the struggle, not grieving
The subsequent discussion session opened the floor for strategic ideas from participants. The emphasis was that this gathering was not for grieving or lamenting fate, but for continuing the struggle. Attendees were encouraged to step out of their comfort zones and contribute according to their capacities.

An academic might contribute through critical research, a journalist through balanced and in-depth reporting, a politician through pro-people policy advocacy, a religious leader through moral and spiritual reinforcement, and an artist through works that raise awareness.

The event closed with a beautiful, touching metaphor drawn from Thom Beanal himself. He once reflected on the rain that welcomed his funeral in Timika. In his poetic logic, he hoped that the words spoken by those who continue his struggle would water the still thirsty soil of the fight.

The land of Papua, with all its natural wealth and cultural diversity, has long been like an arid field waiting for the rain of justice, recognition, and respect from the wider Indonesians.

A test of national commitment
The gathering at the Tempo building ultimately served as a test of Indonesia’s national commitment. Do we truly want to learn from a figure like Thom Beanal? Can we draw wisdom from the journey of a lay pastor who left his religious duties to pursue social justice? Do we have the courage to admit that for decades, systematic structural injustice has occurred in Papua?

And most importantly, do we possess the political will to stop all forms of exploitation and violence, and to build equal, dignified dialogue?

The trilogy on Thom Beanal, launched that day, is not merely a collection of stories from the past. It is a mirror for understanding today’s reality, and a compass for stepping into the future. It is a document of courage from a child of the nation who chose not to remain silent, despite great risks.

It is a legacy for young Papuans so they do not lose their historical roots, and for young Indonesians outside Papua, so they do not lose empathy and a sense of justice.

In the end, the gathering affirmed that Thom Beanal’s struggle is unfinished. His legacy still needs many hands to carry it forward. Amid threats of genocide, ecocide, and various forms of structural violence, prophetic voices like those modelled by the bishops, priests, and presidents who dared to side with justice are still desperately needed.

Will the Indonesian government listen? Will today’s leaders — including President Prabowo Subianto and his ministers — respond to the call to stop mortgaging natural wealth and to start honest, democratic negotiations? These questions still hang in Jakarta’s hot air, while in Timika, the rain may continue to fall, waiting for the words that can water the still thirsty land.

Laurens Ikinia is a Papuan lecturer and researcher at the Institute of Pacific Studies, Indonesian Christian University, Jakarta. He is also an honorary member of the Asia Pacific Media Network (APMN) in Aotearoa New Zealand, and a contributor to Asia Pacific Report.

Article by AsiaPacificReport.nz

The Solomon Islands has entered a new political era. In a historic morning at Parliament House yesterday, Matthew Cooper Wale was elected as the nation’s new Prime Minister.

His victory marks the culmination of a dramatic week in Honiara and signals a potential shift in both the country’s internal management and its place on the global stage.

Wale, the longtime Leader of the Opposition, defeated former Foreign Minister Peter Shanel Agovaka in a secret ballot, winning 26 votes to 22.

The result was greeted with cheers from supporters gathered outside Parliament, Honiara and around the country, as the 57-year-old leader prepared to take the oath of office before Governor-General Sir David Tiva Kapu.

The road to victory
The path to the premiership was anything but simple. Just eight days ago, the previous government led by Jeremiah Manele collapsed after losing a motion of no-confidence.

For years, Matthew Wale has been the most prominent voice of dissent in the Solomon Islands, often coming close to the top job but never quite reaching it. After falling short in the 2019 and 2024 leadership votes, many viewed Wale as the perpetual runner-up.

However, today’s result proves that his persistence and his message of “breaking the shackles” finally resonated with a majority of his fellow Members of Parliament.

In his first address following the announcement, Prime Minister-elect Wale was humble but realistic.

“We take the government at a difficult time,” Wale told the press. “Change is coming. These changes are necessary, and they may be painful. I ask that you join your government in putting your hand to the plough.”

Profile of a leader
Who is Matthew Wale? Born on 13 June 1968, in Ambu Village, Malaita Province, Matthew Cooper Wale is a seasoned veteran of the Pacific political landscape. Before entering the world of policy and Parliament, he was an accountant — a background that many believe informs his disciplined approach to the national budget.

Wale first entered Parliament in 2008 during a byelection for the Aoke/Langalanga constituency. He quickly made a name for himself as a fiery and articulate speaker. Unlike many politicians who stay in the background, Wale has never been afraid of a verbal scrap on the floor of Parliament.

Over the past 18 years, he has served in various roles, but he is best known for leading the Solomon Islands Democratic Party (SIDP) and acting as the primary check on the power of former Prime Ministers Manasseh Sogavare and Jeremiah Manele.

In late 2024, he was even awarded a CBE (Commander of the Order of the British Empire) for his long service to the public and political life of the country, a testament to his standing both at home and within the Commonwealth.

A vision of ‘economic liberation’
What does a Matthew Wale government look like? Throughout his career, Wale has championed a few core beliefs that he calls his “pillars of change”, “anti-corruption and “elite capture”.

Wale’s most frequent target is what he calls “elite capture” — the idea that a small group of powerful people in Honiara control most of the country’s wealth. He has promised to dismantle these systems to ensure resources reach the rural provinces.

Education and health: A vocal advocate for the “ordinary family”, Wale has consistently pushed for increased funding for hospitals and free, high-quality education. He believes that a nation cannot flourish if its citizens are not healthy and skilled.

Political stability: To end the cycle of “grasshopping” (where MPs switch parties for personal gain), Wale has signaled he will seek to strengthen laws that keep political parties disciplined and accountable.

The ‘China question’ and global relations: Perhaps the most watched aspect of Wale’s new leadership will be his foreign policy. For years, Wale was a staunch critic of the 2022 security pact signed with China, warning that it could “jeopardise” relationships with traditional partners like Australia and the United States.

Tone has evolved
However, as a pragmatist, Wale’s tone has evolved. While he is expected to rebalance the nation’s relationships — likely warming ties with Canberra and Washington — he has acknowledged that Chinese infrastructure is now a reality in the Solomon Islands.

He is unlikely to tear up existing agreements overnight, but observers expect a more “balanced” approach that prioritises Solomon Islands’ sovereignty above all else.

As the sun sets on the nation today, the atmosphere is one of cautious optimism. The challenges facing Prime Minister Wale are immense: a struggling economy, high cost of living, and a deeply divided Parliament.

But for today, the man who spent nearly two decades in the wings finally has the chance to lead. Matthew Wale’s message to the people is clear: the road ahead will be hard, but the destination — a fairer, more transparent Solomon Islands — is worth the effort.

The “Hapi Isles” are watching, and the world is, too.

Campion Ohasio is a Solomon Islands-based self-taught visual artist, graphic designer, and prominent political cartoonist known for capturing South Pacific social issues. He gained early recognition in the 1990s for his work on Uni Tavur at the University of Papua New Guinea and later as a editor for the Solomons Voice. This commentary is republished with the author’s permission.

Article by AsiaPacificReport.nz

Keith Rankin, 14 May 2026 – Since the latest Household Labour Force data was released on 6 May, there has been quite a lot of unfocussed chatter about NEETs; young people not in employment, education or training. The standard narrative about NEETs is that they are disengaged young people, especially teenagers, not sufficiently motivated to undertake tertiary education or vocational training in order to find a job.

The latest overall statistic is that 14.4% of New Zealand resident people aged 15-24 are NEETs. In addition, there is an even higher ‘underutilisation rate’. These data are published in an awkward way which makes it hard to mesh them together. And there is a further unmeshed measure; persons aged 15-24 – especially 20 to 24 – who have emigrated.

The real story this year is about young adults aged 20 to 24, not disengaged teenagers. “Women aged 20 to 24 continue to have the highest NEET rate, rising 1.9 percentage points to 20.3 percent in the March 2026 quarter”. This 20.3% is well above the overall rate of 14.4%. The female adult NEET rate has jumped significantly, whereas the male adult rate is lower and has not jumped much this year.

NEETs can be separated into four groups: teenage males and females, and young adult males and females (‘adult’ here being defined as aged over 20). Of these groups, we would expect adult females to be least disengaged. The story that appears to be true is that many if not most NEETS aged 20-24 are young adults who have completed their education or training; rather than being disengaged, these NEETs are educated, trained, often graduated, and raring to commence their careers.

The problem, then, is that we have created an economy which is barely interested in employing our educated youth. This is especially ironic when we keep hearing superannuation scare-stories about how this group of young people will be required to ‘support’ in retirement their huge parental (Gen-X) and grand-parental (Boomer) generations. The statistics clearly show that we are not nurturing this very special cohort, born in the early 2000s.

(Re the underutilisation rates, males aged 20-24 have gone from 11.6% in early 2023 to 18.7% in early 2024 to 19.0% in early 2025 to 21.8% in early 2026. Females aged 20-24 have gone from 17.0% in early 2023 to 23.0% in early 2024 to 22.2% in early 2025 to 25.0% in early 2026. These worsening statistics cannot be blamed on the Israel-USA-Iran war.)

Why Females?

The latest data suggests that tertiary-educated young women are having more difficulty gaining employment than their male peers. Employment outcomes for this age group are very much about employers’ hiring practices.

Economists understand that the perceived labour-cost associated with new hires is all important. This is an age group with minimal work experience, so it means that demographic and educational attributes will be particularly used when making hiring decisions. Statistical profiling – something all employers (including female employers) do, even if they do so with a degree of distaste – is particularly relevant to this age group.

Is the expected cost – a statistical concept meaning the average perceived cost – of hiring young females greater than the expected cost of hiring young males? Especially in the context of very tight business profit margins.

(Differences in expected cost played a huge role in hiring decisions during the Great Depression of the 1930s. Teenage females were cheapest, then teenage males, and then adult females. Adult male joblessness was particularly high in the early 1930s because adult males were the most costly demographic to hire.)

Reasons why young females might be perceived as more costly to employ

Such reasons arise from both statistics and politics.

Individual employers will have access to their own company data. If females in the past decade or so have had a record of leaving their jobs sooner than males, or if they have had a record of taking more sick leave than males, then those records would influence the perceived cost of employing any given female job applicant. Willingness to work overtime – including unpaid overtime – is also something that employers have records of; such willingness, on average, may be different for males than for females.

In the realm of politics, there may be areas of actual positive discrimination – for example, menstrual leave, which exists in a few countries. (See What working women really want: Paid menstrual leave? Stuff 15 August 2023. And of course there are definite examples around maternity leave.) Or perceived positive discrimination; perceived, for example, because pay equity is widely confused with equal pay.

In relation to options like maternity leave and menstrual leave, one way to politically manage these is to offer men similar discretionary leave provisions as those offered to women, to the point that employers perceive the likelihood that a man will take discretionary leave is the same as the likelihood that a woman will take such leave. This, I understand, is the Swedish way. In order to maximise employment of both sexes, the Swedish authorities offer discretionary leave provisions to females and males in equal measure.

Another issue is the sensitivity around the ‘gender pay gap’. (For society as a whole, the ‘pay equity’ argument is that gender-based pay inequity is between occupations, not within occupations or within workplaces.) Such sensitivity is heightened if employers are required to report to some government ministry their firms’ gender pay ratios.

There is one relatively quick way through which employers can make their gender pay ratios more equal. It is to hire fewer young females, giving preference to males. Given that new hires are towards the bottom of employers’ pay scales, having more junior males and fewer junior females will have a significant impact on a firm’s reported gender pay ratio.

Unintended Consequences

The hiring practices mentioned above can all have unintended consequences. Very few employers nowadays – whether male of female employers – believe that it is a good thing to have a gender pay gap. All employers practice ‘equal pay’, as they have been mandated to do since 1972. But employers – under the pressure of legal or moral compliance to achieve one or two key statistics – can end up achieving problematic outcomes for other important statistics.

Is it possible that an unintended consequence of moral compliance in relation to pay equity – of attempts to equalise pay by gender, within firms and other employing organisations – has been to create more young adult female NEETs? It’s a hypothesis that at least deserves to be investigated further.

Of course, there is a wider problem than this female-adverse NEET outcome. There are far too many adult NEETs of both sexes. Our recent governments, through stifling fiscal policies which undermine their own revenue base, have been playing an unnecessary and brutal game of musical chairs; a game in which the odds are stacked against New Zealand’s young adults.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 13 May 2026 – On 7 May, Al Jazeera ran this alarmist programme about the ‘national debt’ of the United States: US borrowing exceeds GDP: What does it mean for the economy? (And here on YouTube.)

A topic surrounded by so much confusion. (Sigh!) The first problem is that what is commonly called the ‘national debt’ is actually the ‘government debt’. Second, we have the issue of which debt measure to use. By one measure the United States government debt has become equal to the United States gross domestic product (GDP). By another measure, that milestone or millstone was achieved long ago, and is now 123% of GDP. The Al Jazeera programme uses both measures interchangeably.

The programme host – Cryil Vanier, who I usually respect as one of the best news anchors in the world’s television media – commenced his contribution with an easily verified untruth; that is, untrue if using the usual measure of debt as a percent of GDP. He said: “The United States is the most indebted country in the world. Almost every year the United States Government has chosen to spend more than it collects. … The national debt now stands at $39 trillion dollars, exceeding the United States economy … for the first time since World War Two.”

($39 trillion dollars is 123% of the United States’ GDP! That 123% of GDP measure is exceeded by Venezuela, Japan [237%], Sudan, Singapore, Eritrea, Bahrain, Greece [146%], Lebanon and Italy [137%]. Government debt is not an indicator of a government’s economic performance, let alone a cause of poor ‘performance’; noting that the concept ‘performance’ itself is about optics – about theatre – rather than substance.)

Debt is owed by debtors, and owned by creditors. The Al Jazeera programme noted that ‘Japan’ is one of the big three foreign owners of the United States [government] debt. But note, above, that Japan is – among first-world countries – listed as the (proportionately) biggest ‘ower’ of debt. Indeed, Japan sees neither its large ownership of debt nor its large owership of debt as being a major problem; the Japanese economy is a sea of tranquillity compared to many other countries’ economies.

There is a problem though; the one trillion dollar interest bill. That’s unnecessarily large; indeed, that’s a much bigger problem for the United States’ government than for Japan’s government, due to very different monetary policies in the two countries.

The key question to ask about the interest is: ‘Where does the money go?’. It goes from the owers to the owners, of course; but who are the debt-owners who receive most of that interest, and to what extent do they represent the real problem (assuming there is a real problem)? For the most part, the interest-recipient owners – not exactly clamouring for repayment – are more than happy to return the interest to the owers, just so long as it is accounted for as additional debt.

The Al Jazeera programme, using one of the more egregious chart graphics that I’ve seen, shows that “debt has ballooned since the eighties”. Correct, though the chart (commencing around 1800) – not using the correct (logarithmic scale) fails to show earlier balloonings. The chart shows a tenfold increase in the dollar-debt – not the percent of GDP – from 1976 to 1996, and a just a 6½-fold increase from 2002 to 2026; yet the latter smaller jump looks dramatic. At the end of the chart-viewing, we are told that there’s “no plan to actively pay it back”.

Putting aside the one-third foreign ownership of the United States government debt, we can think of the remaining two-thirds – the domestically-held debt – as being owned by the ‘US banking system’ (the banks being a short-cut for what is a rather complex financial system). So, the United States domestic government debt – a liability of the Government – is an asset of the United States’ banking system. As is normal for asset-holders, the banks would rather retain and expand their assets; they would rather not liquidate their assets.

On the other side of the banking systems’ ledger lies the liabilities of the United States’ banks. These are the deposits of American households and businesses. The domestic debt is owned by Americans and owed by the American Government. Bank deposits are assets to depositors, and liabilities (ie debt) to banks. Banks hardly see this debt as ‘bad’ in any sense.

People would rather lend their governments than pay taxes, though most citizens realise that a substantial part of government spending should be funded by taxes rather than debt. A mix of taxes and debt works; it always has. Households and businesses prefer to own some government debt than to fund their governments entirely from taxes. It’s not a problem. Debt’s a solution.

The people own the debt that the government owes (albeit through the intermediation of the baking system). The people do not want the government to repay that debt. They just want the government to pay the interest. The people – the creditors, the debt owners – like it just as it is. The government debt is not a problem for them; rather it’s an income for them, and insurance for them.

What would ‘paying it back mean’?

So, if the government repaid its debt to the banks, the banks would either have to force the people to accept back their deposits, or would have to find other borrowers. In the latter case, some parts of the private sector would have to become substitute debtors, thereby adding much to the financial risk of the citizenry. In the former case, the people would have to accept banknotes – paper money – from the drastically shrinking banks; banknotes that could stand to become worthless.

In other words, if governments tried to pay back their debt, there would be a financial collapse on a scale which would make the global financial crisis seem like a non-event. (There was such a collapse in Romania in the 1980s.)

Looking at it from the point of view of the people, the banks’ creditors – especially consider the Mum and Dad savers. They, and ordinary people like them, are the government’s creditors. The government’s debt is an important part of their savings; indeed, of their retirement savings. Who would like their bank coming to them, saying that the bank’s main debtor (the government, as the banks’ biggest debtor) wants to ‘repay the debt’? So, they would have to take back their deposits; they would have to withdraw their funds; say, half their savings. And, at the same time, each other bank would be saying the same thing to its customers.

There is no clamour from the owners of the United States government debt to have that debt repaid. If anything, there is a clamour from would-be owners of United States government debt for the Government to take on more debt; not less. (In Japan, owning government debt is understood as ‘financial security’.)

Global Financial Balances

We can understand the world’s financial balance sheet, showing the net financial relationship between the two big sectors; the private sector (households and businesses), and the public sector (central and local governments).

Throughout the history of the world, the private sector has been the net creditor, and the public sector the net debtor. A financial balance sheet must add to zero; the net debt owed must be exactly equal to the net debt owned. It is not conceivable that the global balance sheet would have the worlds’ governments – taken together – owning the world’s debt, with the global private sector owing it; except possibly under a global soviet-style communist state, where we could imagine most people being in debt to the government.

The global balance sheet has two (net) components. The first component is financial stocks: assets (owning) set against liabilities (owing); these liabilities represent the global public debt. The second component is about financial flows: surpluses (credits) set against deficits (debits). Both components are, by definition, zero-sum games. Total assets minus total liabilities must equal zero. Total surpluses plus total deficits also must equal zero.

For the world as a whole, the public sector (the fisc) runs the deficits, and the private sector runs the surpluses. It is almost inconceivable that, in any year, there could be a global fiscal surplus, meaning a global private deficit. (In most years there are some countries’ governments which run fiscal surpluses.) This state of affairs is driven by the fundamental drive of private citizens to save parts of their income; if successful on balance, by definition a private sector surplus means a public sector deficit. Basic human nature dictates that there will be a global fiscal deficit, every year.

Public Debt management, in practice

The size of the global public debt, measured (appropriately) as a percent of the size of the global economy, goes up and down over time. This is because there are a numerator (the global fiscal deficit) and a denominator (nominal gross world product, the measure of the size of the world economy, the sum of all countries’ GDPs).

We note that the denominator is a nominal measure, meaning that we are referring to the monetary measure of the size of the world economy, not the production measure. Nominal GWP (gross world product) increases either if world production – global output – increases or if world prices increase. A major reason – but not the only possible reason – for increasing world prices is world inflation.

World public debt increases next year if the world’s fiscal deficit is greater than the increase in gross world product (GWP). Essentially, there are three possible reasons for an increase in world public debt: a big global fiscal deficit, a small (or negative) increase in global output, or low (or negative) world inflation. Commonly, then, rising public debt – as appropriately measured – is a result of slow economic growth and/or low inflation.

Conversely, world public debt decreases next year if the world’s fiscal deficit is smaller than the increase in GWP. Essentially, there are three possible reasons for a decrease in global public debt (expressed as a percentage of GWP): a smallish global fiscal deficit, a largish increase in global output, or highish world inflation. Commonly, then, falling public debt is a result of economic growth and/or inflation.

The most painless route to ‘acceptable’ public debt – what is acceptable is in the eye of each beholder – is through inflation. Far from being ‘economic public enemy number one’, inflation is the market’s method – capitalism’s method – of maintaining healthy and sustainable financial relationships within society. The more that financial relationships are ‘out of whack’, the more inflation is needed to put things right.

(We note that policies to raise the inflation rate are not easy to achieve; in the two decades most famous for such policies – the 1930s and the 2010s – it actually proved extraordinarily difficult to use monetary or fiscal policy to bring about reflation. Cutting interest rates did not achieve the inflation sought. Wars, on the other hand, did achieve inflation in the 1940s and 2020s.)

Of course, an ‘out of whack’ financial community is one with relative losers and perceived winners. A healthy correction restores over-indebted losers to a degree of financial health, and reduces the winners’ excessive winnings. That’s why we are in a battle today between the elite classes (including left [Bidenite/Starmerite] elites and right [Luxonite] elites) and the working classes (including most small and medium businesses).

Class conflict is real. Our political elites – left and right – have a policy bias towards high interest rates and low inflation. Our elites favour an ever-expanding flow of financial incomes from the poorer people to themselves. As debt-owners, they do not want inflation to make prevailing debt relationships more sustainable. (Smart elites might have more foresight than regular elites. Though ‘smart elites’ may be an oxymoron.)

Fiscal probity, its obsession and its distraction

Public debt is presented as a monster; public debt is posed as a fundamental cause of inflation. And inflation is posited as the problem which must be fixed before other problems are addressed.

When in the throes of (usually ineffective) inflation-fighting in the name of fiscal probity, the only thing that the established authorities allow as a distraction is the call to war. For some reason deep in the elite human psyche, financial probity has generally taken second place to the excitement of wars in which the elites become the generals and planners, and the working-classes become the planned.

We can easily see that the United States ‘national’ debt is on an upwards, not a downwards, trajectory; the Department of War can loosen Treasury’s guard-rails more easily than the Department of Health. (This is true in Germany too, with last-year’s partial removal of that country’s debt-brake.)

Wars have always been drivers of public debt; they are inevitably financed by huge fiscal deficits. Intractable wars have also been levelling events, wealth-collapsing events – accompanied by inflation – eventuating in relatively good times for working class survivors.

Elites start wars. Wars finish or diminish elites. Elites are poor learners.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 12 May 2026 – The outbreak of (Andean) Hantavirus on board the Dutch eco-adventure ship Hondius clearly is a matter of concern; and is not being played well by the experts who tell us one rather soothing thing about it only being transmitted through intimate contact, but then show up in the highest grade of Hazmat suit when evacuating people from the ship.

See this story Where did the hantavirus outbreak start, and where has it spread? from Al Jazeera (11 May 2026) and this Inside Story episode: Should we be worried about the hantavirus outbreak? (Al Jazeera 9 May 2026, and here on YouTube).

We keep hearing about the established history of the virus in southern South America, whereas we need to get a handle on the possibly quite different future of the hantavirus. This zoonotic virus has probably already changed; or it may have found an environment in which it is possible (or even necessary) to behave differently from the way it behaves in its endemic South American setting.

Around 16 minutes into the program, interviewer James Bayes asks: “This particular ship … is not your typical cruise ship. They describe it as an ‘expedition ship, often with scientific, wildlife or geopolitics lecturers on board’. … I am told that the experience of previous passengers is that they have very strict safety protocols because of the places they visit, mainly for biodiversity reasons. Previous passengers have recalled sniffer dogs and having to wear sanitised boots. If it can happen on a ship like that, do you have concerns in general? … Are cruises incubators for disease? Would you go on a cruise holiday?”  (The subsequent answers, by experts, trivialised this important question.)

The Hondius was as sterile as any ship could possibly be. Could the human-human transmission on board that ship be because of that sterility, rather than despite the sterile shipboard environment? In a sterile environment, a virus which has already infected an embarking passenger has no soil or other muck that it can transmit to; rather, the least sterile life-forms available are the other people on board. Hence an unusually sterile environment may be the counterintuitive cause of human-human transmission of a virus which ‘prefers’ other options.

Evolutionary variation of any life-form can arise in three ways: because of selection in favour of one existing variant over another; because of a mutation creating a favourable new variant; or because of a hybridisation of two quite different variants creating a genuinely novel form. The first of these three mechanisms of variation may have been enough to create a humanly-transmissible form of the Andean hantavirus. (We note that Covid19 was significant because it was transmitted by a novel virus; transmission of coronaviruses has been widespread throughout our lifetimes.)

This would be a nightmare scenario. Such a new-variant virus – maybe a novel virus – would still be lethal, would still have a long incubation period, would have an unknown duration of infectiousness before symptoms emerge, and an unknown rate of transmission.

The Black Death in Europe: 1346 to 1353

This historically famous pandemic reduced the population of Europe by about forty percent. It is generally attributed to a disease called Plague (aka Yersinia pestis), which comes in several forms, the best known being bubonic plague. The Plague pathogen – Yersinia pestis bacteria – was identified by Alexandre Yersin and Kitasato Shibasaburō during a much more recent pandemic; a pandemic which impacted seaports all around the world in the decade after 1894 (including Sydney and Auckland in 1900).

This disease – linked to rats and fleas – looked like a good fit for the Black Death; the descriptions of the symptoms were a good match. So, the Black Death narrative came to incorporate Yersinia pestis as the culprit. This pathogen is endemic today in some parts of the world, including the southwest of the United States, but generally confines its lethal mayhem to rodents. People die of it most years. The good news for later twentieth century human populations was that bubonic plague is treatable with antibiotics.

However, especially around the early twenty-first century, the ‘Yersinia pestis as the culprit’ thesis was substantially questioned. (See A plague on all your houses, The Guardian, 14 Aug 2004; I have read Return of the Black Death: The World’s Greatest Serial Killer by Susan Scott and Christopher Duncan.) This questioning has subsided of late, because of the discovery of Yersinia pestis DNA in the bodies of known victims of the Black Death. James Belich, author in 2022 of The World the Plague Made: The Black Death and the Rise of Europe, argues that those sceptical narratives were an important part of the scientific process, but settles on Yersinia pestis, based on subsequent DNA evidence.

Nevertheless, I was persuaded by aspects of Susan Scott’s argument. She agrees that bubonic plague was significantly present in Europe – especially in Mediterranean ports – in the late 1340s. Essentially, her argument is that there was another disease present at that time in Europe, and that this other disease played a greater role than bubonic plague in the lived experience of pandemic plague in the period from the 1340s to the 1590s. Scott made her argument using village studies which suggested that the three main epidemic parameters – transmissibility (especially from humans to humans), incubation, and duration of infectiousness – were a poor fit for the known information about Yersinia pestis. (We may also note that there is a variation of bubonic plague known as pneumonic plague, which is human-human transmitted, looks a more plausible fit for the 1340s to the 1590s than rat-flea transmission. But the parameters of pneumonic plague don’t fit, either.)

In Scott’s thesis the principal agent of the Black Death was what she calls Haemorrhagic Plague. It is well known today that there is a family group of lethal zoonotic viruses which cause haemorrhagic fevers in humans; these include ebola and hantavirus. For the vast majority of human cases, they are transmitted to humans from animal incubators. Her argument is that the majority of Black Death deaths were caused by one of these viruses, not by Yersinia pestisbacteria. The parameters she calculated from the historical data match haemorrhagic fevers rather well.

The pneumonic symptoms of the two diseases could be similar (albeit more blue than black). Indeed the 1918 influenza pandemic was known, at least in New Zealand, as the Black Flu. Plague is bacterial, treatable by antibiotics. Haemorrhagic fever is not treatable, except at the margins; it’s a viral illness.

We may also note that it’s rare to have two simultaneous epidemics. One epidemic of a viral disease tends to pre-empt another viral pathogen. However, simultaneous epidemics – even pandemics – of bubonic plague and haemorrhagic fever seem entirely plausible. Because the pathogens are so different, even if the end states of both diseases are quite similar. And we note that the stresses arising from one lethal illness may create malnutrition and other states of being likely to make us more vulnerable to a second quite different pathogen doing the rounds.

We should also note that, after much trial and error, the Black Plague could be contained by quarantine; isolation for forty days. Quarantines are particularly effective for human-human transmissible diseases. Presumably less effective at containing burrowing rodents (or mosquito-borne diseases for that matter). Rats don’t carry passports.

Warning

Susan Scott was particularly concerned about modern complacency towards the Black Death. The widespread perception in modern infectious diseases studies is that bubonic plague is treatable, and that the rodent-flea transmission mechanism is less plausible in modern more-sterile environments, reflecting the perception that modern cleanliness and bubonic plage are incompatible. (And noting James Bayes’ presumption that if hantavirus can transmit human-to-human on a sterile ship, then it must be able to so transmit anywhere.)

There is no complacency towards haemorrhagic fevers such as ebola (hence the PPE); although it’s still widely understood to be – in a sense, dismissed as – a ‘third world’ disease. Susan Scott was concerned that complacent modern public health systems would leave us completely unprepared for a pandemic involving a haemorrhagic virus, such as hantavirus; indeed, I did not sense sufficient concern among the panel of interviewees on Inside Story.

Even if it can be proved that Scott’s thesis about the Black Death is completely wrong, then nevertheless her research still represented an important warning to the world about what the next really lethal pandemic might look like. At the very least, the present hantavirus scare should be understood as an important wake-up call.

If we had learned much more about the history of coronaviruses – viruses which were known to have been long-circulating as ‘common cold’ viruses – after the 2003 SARS1 panic, we might have been much more prepared for the SARS2 Covid19 pandemic in 2020. Scientists should not be too quick to dismiss Susan Scott’s hypothesis about the causes of the ‘great levelling’ event which came to be called the Black Death.

A lethal transmissible disease which is asymptomatic for six weeks, and which is infectious before symptoms occur, is one of our worst public health nightmares. The present scare should remind us of that.

How can we cooperate through pandemics when we are too busy waging hot and cold wars? The 1918 novel influenza virus was forged on the battlefields of France; a hybrid of influenza strains from Asia and America. In the end, it killed as least as many people as were killed on the 1918 battlefields.

We should learn to question prevailing narratives. Experts – whether epidemiologists, economists, or geopoliticians – don’t have all the answers; too often they pontificate from professional scripts while ignoring inconvenient evidence. People, especially those with a modicum of power, should exercise their influence with more humility and less sureness.

The world is becoming more vulnerable; too vulnerable for badheads and hotheads and sureheads (such as Christopher Luxon) and bombastic appeasers (such as Keir Starmer) who cannot broach alternative explanations or strategies. These people simply ‘double-down’ when the evidence is that what they are doing is harmful or counter to their stated objectives.

Pestilence follows deprivation, closed-mindedness, and stupidity. These qualities are not confined to the uncivilised. Our environments fight back, often in ways that we least expect, often in places where we do not look.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Keith Rankin, 11 May 2026 – At the end of this month, the Russia-Ukraine War will have dragged out for as long as World War One, conventionally dated. It’s already much longer than World War One using Russian dating, given Russia’s early exit from that war.

World War One, especially in the East

Despite its minimal emphasis in the anglophile understanding of WWI, the central conflict of that war was between the German Second Reich (the Prussian Empire) and Russia (the Russian Empire). The war was started, with full intent, by the German military who were able to play the emotionally volatile Prussian Kaiser, Wilhelm II. Germany started the war because the Prussians had convinced themselves that Russia was becoming too strong and would inevitably – probably sooner rather than later – invade (and try to overrun) Germany and then the rest of Western Europe.

There was no evidence of such Russian intent. The German Prussians interpreted ‘could’ as ‘would’. So, they decided to attack Russia at a propitious moment, should such a moment arise. Germany had its opportunity in 1914 when Austria-Hungary deemed it necessary to start a Third Balkan War, against Serbia. The Germans adroitly manoeuvred the Austrians into pivoting away from the war the Austrians wanted, and to provide Eastern cover for the war against Russia which Germany wanted.

The reason Germany required Eastern cover was that they feared an attack from Russia’s ally, France. So, the Prussians decided to quickly deal to France, while Austria held back Russia to Germany’s east. Of course, the rest is history; the German army got bogged down in France and Flanders. Austria got exposed in the East. But Germany was able to fight on both fronts simultaneously, and eventually defeated Russia despite having to hold the Western Front.

Russia ratified its surrender in March 1918, when Leon Trotsky signed the Brest-Litovsk Treaty. In that 1918 Treaty, Russia – having just become the Soviet Union – surrendered Ukraine (though not Crimea) to Germany.

Luckily for the new Soviet ‘Bolshevik’ regime – in 1918, while running a substantially reduced Russian Empire – the forces of France, United Kingdom, USA, and influenza prevailed over the forces of the German Second Reich. (By giving Lenin free passage from Switzerland – the German military indirectly plotted the Russian counter-revolution that brought Lenin and his Bolsheviks to power in October 1917, nine months after Tsar Nicholas II was deposed in a popular uprising. Russia experienced regime-change twice that year.)

In the first half of 1918, Germany broke through in the West, bolstered by soldiers transferring from the East. But Germany’s supply lines were too stretched, and soldiers on both sides of the Western Front got very sick from the influenza which was the Americans’ principal contribution. It was only in July 1918 that France gained the upper hand over Germany on the Western Front; Germany quickly folded after that.

The result was the Armistice of November 1918, and the 1919 Treaty of Versailles. The 1919 Treaty stripped Germany of its March 1918 victory spoils; the principal of those spoils being Ukraine. The 1919 Treaty also humiliated Prussia, by separating Prussia’s eastern homeland (now Russia’s Kaliningrad) from the rest of Germany.

In 1919, Germany was not pleased about many things. Foremost among those things was the loss of its prize Eastern conquest. This humiliation formed a key part of reactionary Germany’s ‘stab in the back’ hypothesis; the hypothesis which galvanised the subsequent rise of Adolf Hitler and the Nazi (National Socialist) Party.

The Present War – which in an important sense is again Germany versus Russia

In normal ahistorical ‘rules-based’ discourse – the present war looks like an open and shut case. Bad Country A (Russia) invaded Good Country B (Ukraine). Naughty Vladimir. Solution: tell Vlad to take his war toys back home, and behave himself. (This narrative is hard to sustain now, though, given the 2020s’ behaviour of Israel and the subsequent suspension of the rules-based order.)

Seen through a geopolitical (and appropriately historical) lens, the Ukraine quagmire looks very different from the story that the anglophone world still clings to. A Nato/EU project of eastward expansionism – a ‘Greater Europe’, like a ‘Greater Israel’ but without the overt ethnic cleansing – threatens to return German troops to the heartland of what had been for centuries the economic core of the Russian Empire; namely the territory of Eastern Ukraine.

World War Two

From the Russian point of view, Germany has long coveted the entire territory of Ukraine; not just the bits of West Ukraine which once belonged to the Austro-Hungarian Empire of Franz Josef of Hapsburg (who gifted Aotearoa New Zealand the name of a glacier).

Adolf Hitler’s principal aim was to reverse the humiliations of 1918 and 1919. Thus, once in power, and once Germany had restored its manpower and its gun-power, Hitler struck back into France, forcing the French to sign their surrender at the same place and in the same railway carriage which was used for the 1918 Armistice signing. This time, there was no Austrian Empire to attend to Russia in the meantime. So, Hitler, in 1939, did a deal with Stalin, so that Hitler could deal to France without too much simultaneous aggro in the East.

Once France had been pacified, Hitler turned back to what was really the whole purpose of World War Two in Europe; to win back the territories that had been won in 1918, but had been lost through alleged ‘backstabbing’ in late 1918 and early 1919. (For the 1920s’ ‘make Germany Great Again’ project, the events of late 1918 and early 1919 were the first ‘great steal’.)

The reason for Hitler’s war was lebensraum; it was Hitler’s expansionist project. The principal aim was to re-acquire Ukraine. Having done so – for example, in the First Battle of Kiev (1941) – Hitler’s main goal for the Third Reich was to match the ambition for the Second Reich in WWI, and proceed to take control of the Russian oilfields to the east of Eastern Ukraine.

The Reich held Ukraine for more than two years, until the second Battle of Kiev late in 1943. This time the Russians of the Soviet Union had to defeat Germany on the battlefield; which they did at a huge blood cost.

Just this last weekend, Russia commemorated its military defeat of Nazi Germany.

Finally

From Russia’s point of view, today, the Ukrainian battlefield represents a field in which Nato’s proxy – the Zelenskyy regime of Ukraine – is bringing a Fourth Reich (the European Union; understood to be German dominated, even if Germany’s strength in the European Union temporarily waned after Angela Merkel stepped down) to finally achieve the conquest of Ukraine; the conquest which, from a German perspective, twice in the twentieth century fell agonisingly short.

So, as I read it, no Russian regime – whether led by Putin or somebody else – will ever let Nato (meaning, from a Russian viewpoint, Germany) into Eastern Ukraine.

Militarily, after years of stalemate, Russia has had enough; it is now looking for an offramp by trying to do a deal brokered through former German Chancellor Gerhard Schröder. Other than achieving an acceptable deal, Russia can only play for time; it cannot accept a ‘cease-fire’ involving ‘coalition of the willing’ ‘peacekeepers’. Western Europe – especially ‘Old Europe’ – is politically imploding at present; to sustain military ventures, it is dependent on an increasingly unwilling United States.

As I see it, the present war can end easily. But only under a Treaty which prevents Ukraine – or at least Ukraine east of the Dnieper River – from ever hosting German soldiers. The Russian history of World War One and World War Two is too recent for that. The American President, to his credit, has tried to broker a peace in Ukraine. But ‘Old Europe’ will not allow such a peace, as we have seen whenever such a peace deal seemed close.

The main reason Germany folded to the West in 1918 was the Royal Navy’s blockade of German ports; hence an important reason in the 1940s for Hitler’s emphasis on regaining Ukraine. Old Europe wanted, and still wants, Ukraine in its geopolitical orbit. Lebensraum, in the form of a greater western European geopolitical territory, is still at play.

This time Ukraine, Europe’s breadbasket, may be less required for the purposes of food security; though that may be changing with the protracted American and Iranian double-blockade of the Persian Gulf. My deeper sense is that the populist political right in Europe – which is slowly regaining ascendency – has demographic designs on Ukraine. Ukraine is a land with many white women; whereas Old Europe is much less white than it once was, and white women in Old Europe in the 2020s are having very few babies.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

Vanuatu’s government has urged the French ambassador in Port Vila to use established diplomatic channels rather than social media to communicate his concerns about state-to-state relations.

It is the latest development in a diplomatic spat that emerged this week when New Caledonia’s territorial government took umbrage at Vanuatu for hosting the leadership of the pro-independence Kanak and Socialist National Liberation Front (FLNKS) group as part of a trade forum earlier this week in Port Vila.

The ambassador, Jean-Baptiste Jeangène Vilmer, has made multiple Facebook posts in the past few days explaining his concerns. But he also found time to hit out at Vanuatu’s main daily newspaper Daily Post over its reporting of the dispute between the Melanesian country and France over the Matthew and Hunter (Umaenupne and Umaeneag/Leka) islets.

In a statement, Vanuatu’s government noted “with unreserved interest”, the ambassador’s “extraordinary decision” to go public through social media.

Vanuatu hosted a series of talks under the theme “VOICE 2030” (Vanuatu Opportunities for Investment and Caledonian Enterprises) dedicated to exploring the strengthening of trade relations with the neighbouring French Pacific territory of New Caledonia.

The FLNKS delegation attending was led by its president Christian Téin — who until recently was held in pre-trial custody in France on charges relating to independence unrest in New Caledonia in 2024.

The delegation also included government minister, Mickaël Forrest, who holds the Youth and Sports portfolio, but is not in charge of trade.

New Caledonia’s government issued a statement on Monday, May 5 — before the Ambassador’s comments on social media — stating that the delegation in Port Vila could not be regarded as an official delegation of the government and that those attending were not acting in any official governmental capacity.

That same day, Christopher Gygès, the member of New Caledonia’s government who is responsible for trade, announced that he was suspending work relating to the proposed trade cooperation agreement currently under negotiation between New Caledonia and Vanuatu.

The ambassador then made a series of posts on Facebook attempting to explain the crux of the problem from the French viewpoint.

“It was the president of the FLNKS — an opposition political party with no jurisdiction in this matter — who was presented as head of the delegation and officially welcomed at the airport by the head of protocol at the Ministry of Foreign Affairs and the chief-of-staff to the Minister of Trade,” Vilmer said.

In another post he explained he had met with Vanuatu’s Foreign Minister Marc Ati to give him a better understanding of France’s position “so that it is properly understood”.

‘Extremely unfortunate’
However, Vanuatu’s government said the delegation from New Caledonia “participated with the full approval of the Government of New Caledonia to engage with the Government of Vanuatu on opportunities relating to trade, investment, and broader economic cooperation”.

“It is therefore extremely unfortunate that the Ambassador’s posts on social media have unnecessarily provoked public misunderstanding and divided national opinions on the actual state of play.”

In its statement, the government of Prime Minister Jotham Napat also explained that the FLNKS’ attendance was part of Vanuatu’s “longstanding engagement with stakeholders involved in the New Caledonia decolonization process”, consistent with established foreign policy principles as well as the deep links between ni-Vanuatu and the indigenous Kanak people of New Caledonia.

The government said this did not diminish the importance Vanuatu placed on its “longstanding and constructive relationship” with France.

While Vilmer has insisted he was attempting “constructive dialogue”, his social media posts have been anything but that in the eyes of Vanuatu’s government.

Matthew and Hunter
The relations between the ambassador and Vanuatu further deteriorated today with a Facebook post indicating that the Vanuatu Daily Post had quoted him out of context in a recent article on the Kanak position regarding Matthew and Hunter.

Vilmer’s post noted that he had not made any “press statement” about this issue, as claimed in the article.

In a subsequent Daily Post piece today, encompassing the ambassador’s claim, Vilmer is further quoted as suggesting changes of leadership in Vanuatu’s government in recent years coincided with a stalling of negotiations on the disputed islets, suggesting it was not a priority for Vanuatu.

This drew a stern rebuke from former prime minister, Charlot Salwai, who is the leader of the Reunification of Movements for Change party, one of the parties in Vanuatu’s coalition government.

Salwai described Vilmer’s remark as misleading, and said Vanuatu always discussed Matthew and Hunter at every bilateral meeting with France or New Caledonia.

The next meeting between French and Vanuatu officials in which the dispute would be discussed is expected in the next couple of months.

Meanwhile, the disagreements this week have not prevented the broader economic relationship continuing, nor the ambassador continuing to work constructively on other matters with the government in Vila.

Yesterday, Vilmer joined the Deputy Prime Minister, Johnny Koanapo, to inaugurate a new maritime freight service linking Nouméa, Port Vila and Luganville, operated by the Compagnie Maritime des Îles’ vessel Karaka, with a capacity of 1700 tonnes of cargo and 80 containers — the first such maritime freight link in about 15 years.

This article is republished under a community partnership agreement with RNZ.

Article by AsiaPacificReport.nz

Note the following from An Economic Model for Securing Hormuz, 30 April 2026 for Project Syndicate, by three British-based emeritus professors of economics. Or see The Strait of Hormuz, Towards a Long-Lasting Solution 18 April 2026, CESifo Working Papers.

The authors say: “The need for solutions that rely less on coercion and more on aligning economic incentives with America and Iran’s shared interest in keeping the Strait open. That may mean institutionalizing today’s emerging arrangement, by which Iran, in coordination with the Gulf states, guarantees safe transit for a fee. Such a system would resemble the agreement under the Montreux Convention that governs passage through the Turkish-controlled Bosphorus and Dardanelles Straits. An Iranian toll based on Turkey’s current transit fee of $5.83 per net ton would be about $0.58 per oil barrel—small enough, relative to the value of the goods, that shipping firms would not balk at the expense or seek alternative routes. … such a toll would generate $4.3 billion annually, an amount large enough to create significant incentives for Iran to facilitate and ensure safe passage.”

Such an arrangement is described as a “service-based toll system”, and is arguably more efficient and stable than any alternative arrangements.

Clearly such ‘service-based’ systems are used in the Panama and Suez Canals. The service component of canal maintenance is obvious, and of course in the Panama case there is a substantial resource cost in terms of water required to run the locks. Yet in both cases the fees charged include substantial ‘rent’ or ‘royalty’ components. And for the Strait of Hormuz – along with the other examples – a significant service would be that of ‘protection’ or ‘security’.

Such a protection-fee may have the look of ‘extortion’ about it; but it also has the look of a regular ‘property right’; noting that property rights – and fees arising – form the centrepiece of liberal economics. Indeed, as it was, the world economy – and ecology – has been blighted by ‘cheap oil’. Every little bit to raise the price of oil – and oil-based products – towards their long-run opportunity costs can only be a good thing.

Under such a commercial regime, we could call the Iranians and Omanis (and whoever else becomes part of the service-consortium) Strait Lords or straitlords (like landlords). Indeed Egypt and Panama are – among other things – Canal Lords.

What would happen if the Strait of Hormuz was blocked by a giant earthquake? Then a pipe, tunnel, road or canal would have to be built. There would be no argument then about a portage fee being charged.

Indeed, there are many landlocked countries in the world. They expect to have to pay something to foreign authorities to access the international marketplace for goods. Ethiopia, with well over 100 million people, depends substantially on the port of Djibouti. Kazakhstan depends on China and Russia. Paraguay depends on access to the Paraná River. Switzerland depends on the Rhine and Rhone. Austria depends on the Danube. These passages all have associated commercial costs.

War and Sport

In the event of wars, Straits are typically the first passages to be blocked. Just think of the Strait of Dover, which connects the English Channel to the North Sea, in World War One and World War Two. The British used mines and submarine nets and guns to keep unauthorised traffic out. The best solution to wartime privations is to not start wars in the first place; and – if they happen anyway – to quickly find a pragmatic economic solution to end the war without creating ‘losers’; to end the war through negotiations rather than belligerent ‘demands’.

There is only one unreasonably belligerent nation-state in Southwest Asia, and it doesn’t have a coastline on the Persian Gulf. The rest of the states in a region – or in the world, especially when a Strait or a Gulf has global significance – can corral such a rogue state, if they choose to do so.

It is to the dismay of the vast majority of the world’s population that the rogue state of Israel has been allowed to operate uncorralled, and for so long; Israel with the thoughtless support – the uncritical loyalty – of its distant champion, its Goliath. Principles-based economic pragmatism can rule when rogues are constrained or reformed.

Iran is a proud nation that will play a fair game; it will, if allowed to, play fair and play hard. That’s the sporting mantra which reflects, for example, the New Zealand All Blacks.

Conclusion

The emeritus economists conclude: “The Strait of Hormuz is a cornerstone of the global energy system. For many years, the United States effectively managed its security; but this arrangement has become economically inefficient and politically asymmetrical in terms of responsibilities and burden-sharing. A cooperative regional security regime funded by transit charges [my emphasis] offers a promising alternative that would benefit oil exporters, shippers, and consumers.”

Yes, such a regime could contain a royalty component as well as a service component; ‘clipping the ticket’. Capitalism runs best with rents, but not excess rents, not Goliath rents.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

7 May 2026 – In Aotearoa New Zealand, citizenship functions as an exit permit. An adult New Zealand citizen is free to choose to become a foreign denizen.

A denizen (of New Zealand) is a person living and working in New Zealand, but who doesn’t qualify for a New Zealand passport. New Zealand has three tiers of denizenship, although the first tier are actually citizens who are perceived as immigrants. Too many New Zealanders – probably increasing numbers of New Zealanders – tend to regard all New Zealand residents who don’t look or sound Pakeha, Māori, Pasifika, white South African, or Australian as non-citizens; as not real New Zealanders.

New Zealand is increasingly becoming a country with a high denizen-to-citizen ratio. New rules intended to make it more difficult for New Zealand permanent residents to become citizens of Aotearoa New Zealand can be expected to keep more immigrants here. That may be the intention.

Probably the countries with the world’s highest denizen to citizen ratios are the United Arab Emirates and Qatar.

First-tier denizens don’t count as denizens, because they are actually citizens; they are just casually perceived by many to be denizens. Citizens of Indian or Chinese heritage whose presence in New Zealand dates back to the nineteenth century may be perceived as denizens now, whereas they were once perceived as citizens.

Second-tier denizens are those people living in New Zealand with ‘permanent residence’ status. Except that we would regard New Zealand resident Australians as citizens, even if most of them are not, technically.

Third-tier denizens are any ‘visa-holders’ living in New Zealand with some ‘right to paid work’ provision in their permits. This does include many international backpackers and many international students.

The denizen to citizen ratio is the number of resident adult second- and third-tier denizens divided by the number of resident adult citizens. I don’t know what it is, but am guessing that it is about one-to-three, and growing. (In the United Arab Emirates the denizen to citizen ratio is about nine-to-one.)

Is the new policy essentially an immigrant-retention scheme? We need our immigrants to stay, so in that sense it may be good policy. And, as the financial literati keep telling us, we are going to need many workers in the 2030s and 2040s to sell or otherwise provide services to our seniors. It’s just a shame that New Zealand has so many jobless young people, including many NEETs – over 20% of women aged 20 to 24 counted as NEETs in early 2026 – who have finished their tertiary education yet are not able to secure employment.

Young and Old

Just a note, if a decision is ever made to income-test New Zealand Superannuation, then many New Zealanders aged over 65 will choose retirement over employment, aggravating the pensioner to worker ratio. New Zealand has one of the world’s highest pensioner employment rates, thanks to its universal system of retirement income which enables people to delay retirement. Statistics New Zealand should keep more granular data about the employment attributes of people aged over 65.

And they should keep statistics of the numbers of qualifying people aged over 65 who choose to not opt-in to New Zealand Superannuation. The fiscal cost of qualifying older cash millionaires signing up for a superannuation income which they don’t need – all citizens and denizens with permanent residence – may be smaller than is widely presumed. We should find out.

The cost of income-testing seniors may be less than the actual savings. Further, given that the universal model works best for seniors, it most likely works best for juniors, too. Too many NEETs are trapped into the targeted benefit system. New Zealand is too poor to sideline its young citizens; too many respond by using their citizenship as an exit certificate; exit from Aotearoa New Zealand.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

6 May 2026 – While I have been aware for some time about Sweden’s difficulty in adjusting to its large inflow of refugees in the 2010s – especially African and Muslim refugees – I was nevertheless shocked by what I saw in the 2025 alternative travel documentary series Scandinavia with Simon Reeve, broadcast in New Zealand by SkyGo. The particular episode which compares and contrasts refugee ‘integration’ in Sweden and Denmark is here on DailyMotion, with a full transcript.

Before mentioning crime, cocaine and apartheid, we should note that Sweden is a large-scale military systems exporter. For Sweden, the ‘big gun’ industry is equivalent to the dairy industry in New Zealand as a source of foreign exchange revenue. Reeve notes: “There is really no other country of comparable size, of comparable population that can produce its own fighter jets and submarines. … The Swedes make some of the most advanced weapon systems in the world.”

In still-mainly-white and privileged central Stockholm, a quasi-progressive economist who appears to have a Jesus-complex notes among other things that Sweden’s much vaunted (though targeted) tax-subsidy system is “ensuring that women not just continue to provide economically for the family, but also for the state as well.” He notes “they contribute so much to our economy and welfare”. Sweden is the archetypal liberal mercantilist state that insists on running huge current account surpluses, and interprets national success as making vast amounts of money; it’s a corporate society which engineers people into making choices which reflect the ‘rainy day’ values of its state system.

In six out of seven years, Sweden ran current account surpluses in excess of five percent of GDP. Sweden has always run such surpluses for more than thirty years; as a country, it keeps putting ‘money in the bank’ and not spending it. It could be said that its foreign ‘investments’ support New Zealand’s inflated standard of living. New Zealand hasn’t had a current account surplus since 1973, and typically has a current account balance of minus five percent of GDP; mirror image of Sweden.

Despite (or because of) its liberal and mercantilist credentials, Sweden is a failing state. Reeve visits the police bomb squad. We learn that: “Deadly shootings among drug gangs, largely run by people from immigrant backgrounds, have more than tripled. The gun murder rate in Stockholm is now roughly 30 times that of London. Sweden has the highest gun crime death rate in Europe, after Montenegro and Albania. And it’s not just guns. … Somewhere around 2018, [Sweden] experienced rapidly increasing numbers of homemade bombs, hand grenades and so on. … Most of the hand grenades being thrown are being thrown by very young boys and girls. … Bomb units can get four callouts a day.”

He goes on to note: “Gang warfare has exploded here, fuelled by the rise in cocaine use in Sweden and across Europe. Gangs have taken advantage of liberal policies that children shouldn’t be arrested and actively recruited them. … Most of the perpetrators, as well as the victims, come from immigrant communities. … In recent decades, Swedes welcomed refugees from world conflicts, more than 100,000 from the wars in the Balkans, and hundreds of thousands from Syria, Iraq, Afghanistan. … Housing’s been provided, but often far from city centres, in estates where up to 90% of residents are now from immigrant backgrounds. … Two areas of suburban Stockholm … estates are cut off, hemmed in by motorways.”

The main problem growing up in those estates, mentioned by a Swedish-born woman of Somali descent, is “poverty”. “When I was 15 years old, I lost my best friend at this gang war that has been happening for 10 years, for decades. … The first thing is they need to see us as humans.” Yes, in Sweden, with its much-vaunted welfare state. (The Somali refugees came in the early 1990s, as a result of one of the United States’s failed foreign adventures.)

Reeve concludes: “We can debate whether there’s been a failure to integrate, but there has definitely been a failure of integration. The consequences are now being felt.”

The present government – in office since 2022 – is, more than most governments in Sweden’s history, heavily into New Zealand’s Luxon/Willis style of fiscal consolidation. Albeit with higher taxes and targeted subsidies.

We may note the following recent stories hosted by Al Jazeera: ‘Ready to murder?’ How criminal networks in Sweden are recruiting children to kill (15 Dec 2025), and Gangland wars killing dozens of bystanders, report Swedish police (4 May 2026). The former states that “What began as a utopian welfare project [of public housing in the 1960s and 1970s] gradually evolved into the physical framework of today’s segregated suburbs.” (Is this a portent of the fate which will befall the Unitec housing project, Te Kukūnga Waka, still very much in its early days? See my Carrington Precinct, Aka Unitec, 5 February 2026, Scoop) The latter story notes that “the minority right-wing government, propped up by the far-right Sweden Democrats, has been pushing through proposals to crack down on crime and immigration ahead of a general election on September 13.”

Sweden, reflecting its exceptionalist image as a warmly welcoming country, rejected any attempts to ‘assimilate’ its refugee immigrants; supposedly leaving them to retain their cultures of origin while being supported in deep poverty traps, in a suffocating welfare state of targeted housing and tightly means-tested hand-outs.

Denmark

Denmark, in recent years has gone the other way, heavily restricting refugee immigration and forcibly removing people from their immigrant silos into ‘mixed communities’. They have done much as what ACT in New Zealand wants to do here; mix them up, and sign them up to traditional national values.

Simon Reeve notes: “It would be wrong to think there are no problems in Denmark. All this social cohesion means outsiders can sometimes feel unwelcome. If you don’t conform here, it can feel uncomfortable.”

“The government even introduced what was called a ghetto law, aimed at preventing neighbourhoods being dominated by so-called non-Western immigrants. … One designated ghetto was the multicultural neighbourhood Mjolnaparkin. … Some families were actually forced to relocate. … It’s been described as the social experiment of the century. It’s also being described as social policy with a bulldozer. … Non-western parents in ghetto areas are now required to send their one-year-olds to preschools to ensure they learn Danish and traditions and values, or they lose government welfare benefits. Ghettos have since been renamed parallel societies …  an attempt to enforce and impose fundamental Danish values.”

Current policies; and multiculturalism in Aotearoa New Zealand

“Sweden’s reduced overall net immigration to zero. Denmark has the same target … they’ll offer up to £26,000 for immigrants to return home.” And “even in liberal Sweden, I met indigenous people who feel forgotten and excluded.” Shame, shame, shame. Sweden functions now too much like an apartheid state. And Denmark too, in its own less violent and less overt way.

In my view, genuine multiculturalism – cultural fusion – works best. In Aotearoa New Zealand that’s an absolute requirement, given the extent of demographic turnover, losing so many New Zealand citizens as well as welcoming immigrants. New Zealand will progress best without particular immigrant cultures becoming too dominant in any suburbs.

The word I like is ‘fusion’. Certainly not ‘assimilation’! Think of it like a ‘fusion restaurant’. We like immigrants to become fully integrated New Zealanders. But, in that process, New Zealand and ‘New Zealand values’ change; they adapt in a progressive way. In New Zealand we are doing this so much better than in Scandinavia. Especially in my own community of West Auckland which is financially poor but culturally rich, and has no ethnic or cultural silos or ghettos.

New Zealand of course could do much better. But it’s so important that neither overt nor covert racism creep further into the mainstream political discourse here. In New Zealand, relatively recent immigrants and their descendants supply so many of the goods and services which sustain us. Thankyou.

About the writer:

Keith Rankin (keith at rankin dot nz), trained as an economic historian, is a retired lecturer in Economics and Statistics. He lives in Auckland, New Zealand.

The declaration was made by the leaders of the Solomon Islands, Tonga and Palau following discussions in Nadi, Fiji, on Friday in light of the looming energy crisis as a result of the illegal US-Israel war on Iran.

The meeting brought together the incoming Chair, President Surangel Whipps of Palau, and outgoing Chair, the Prime Minister of Tonga, Lord Fakafanua.

On a social media post, Solomon Islands Prime Minister Jeremiah Manele noted that Solomon Islands continued to experience the impact of global fuel price volatility and highlighted the importance of practical regional solutions to support vulnerable Pacific economies.

Leaders noted that Tuvalu and the Marshall Islands had declared energy emergencies, while Solomon Islands, Fiji, Nauru, Vanuatu, the Cook Islands, and the Federated States of Micronesia were implementing national mitigation measures.

Other Forum members remain on a regional watch phase, with ongoing monitoring by the Pacific Islands Forum Secretariat.

New Zealand’s Ministry of Foreign Affairs and Trade is aware the Forum Troika has invoked the Biketawa Declaration to respond to the current global fuel and energy challenges.

A spokesperson for MFAT said they are supportive of regional efforts to respond to regional crises, including through the Biketawa Declaration.

They said they are working closely with Pacific Islands Forum partners to understand the fuel supply situation, and potential needs, across the region and how they could assist.

This article is republished under a community partnership agreement with RNZ.

Article by AsiaPacificReport.nz

It is the people of the Global South, not governments, who must resist this subversion of the concepts of the “nation’ and of non-alignment.

The Indian government’s position on the US-Israeli war against Iran shows an unbelievable degree of pusillanimity.

India attended the recent meeting of about 50 countries called by the United Kingdom where Iran was strongly criticised for closing the Strait of Hormuz, but not a word was uttered against the US-Israeli aggression on Iran.

Likewise, India was one of the sponsors of a resolution at the UN General Assembly which criticised Iran for attacking other countries in the Gulf (though Iran was attacking only the American military bases located in those countries). Yet again, not a word was uttered in that resolution condemning the US-Israeli aggression on Iran.

It is also noteworthy that India took several days before expressing any grief over the assassination Iran’s supreme leader Ayatollah Ali Khamenei, and several weeks before expressing any shock over the brutal killing of 175 innocent schoolgirls in Minab.

Such pusillanimity, however, is not confined to India: as many as 135 countries were co-sponsors of the dishonest and duplicitous UNGA resolution mentioned above, afraid that they would otherwise offend the Americans.

In fact, apart from a handful of countries in the entire world, none has had the gumption to condemn unambiguously the blatantly illegal and immoral war unleashed by the US-Israeli combine against Iran.

Extreme concern
This is a matter for extreme concern, for the attack on Iran abrogates the concept of sovereignty of nations that had been the core concept in the struggle for decolonisation and had underlain the entire post-colonial order. It destroys, in other words, the very rationale for decolonisation.

This pusillanimity on the part of Third World countries is also a matter of great puzzlement. After all, these are countries that have had long and arduous anti-colonial struggles to achieve the status of independent and sovereign states; how can they remain silent when this very sovereignty is being violated in the case of a fellow Third World state by the armed might of US imperialism?

The answer to this question, no doubt complex, must nonetheless incorporate recognition of at least two fractures that neoliberalism has introduced into our world. One is the fracturing of the concept of the “nation” whose coming into being had been accomplished by the anti-colonial struggle.

This concept of the “nation” had differed fundamentally from the European concept that had developed in the wake of the Westphalian Peace Treaties in at least three ways: first, it was inclusive and did not identify any “enemy within”; second, unlike European nationalism it shunned any imperial ambitions of its own, in the sense of having designs over the resources of distant lands; and third, it did not apotheosise the nation as standing above the people whose “duty” supposedly was to serve it.

The coming into being of this inclusive concept of the “nation” was in turn a reflection of the fact that the anti-colonial struggle was a multi-class struggle; and the dirigiste economic regime that was erected after independence, though it promoted capitalist development, also sought to put curbs on rampant capitalism in the name of achieving “national” development.

This was in the interests of preserving its multi-class support base, which even the monopoly capitalists were not averse to at that time, since they had wanted a trajectory of development where the state exercised relative autonomy vis-a-vis imperialism. The existence of a large public sector was a part of this trajectory.

Further, the policy of non-alignment pursued by these dirigiste regimes had complemented this quest for development in relative autonomy from imperialism. Michal Kalecki, the Polish Marxist economist, had erred in calling such regimes “intermediate regimes” and suggesting that the middle classes held decisive power in such regimes; but he had been right in identifying state capitalism (public sector) and non-alignment as the two most distinctive features of these regimes.

Monopoly bourgeoisie
With globalisation of capital, however, things changed. The domestic monopoly bourgeoisie integrated itself with globalised capital and abandoned its agenda of pursuing a development trajectory that was relatively autonomous of the metropolis.

Sections of the upper professional and bureaucratic segments of society, keen to send their children to study and settle down in the metropolis, joined in as supporters of the neoliberal regime that emerged under the aegis of this globalised capital.

The landed rich too sought their fortunes within this new neoliberal order, which not only promoted rampant unrestrained capitalism, but came down heavily against workers, peasants, agricultural labourers, petty producers and the lower salariat. A schism was effected within the class alliance that had been forged in the course of the anti-colonial struggle.

It was no longer the “nation” against the metropolis that was in focus, but big capital including multinational capital against those social groups which stood in the way of instituting rapid “development” defined exclusively in terms of GDP growth-rates.

The interest of big capital was, by a sleight of hand, identified as “national interest”, and the duty of all classes was to promote it.

This shift in the meaning of the term “nation” meant in effect a fracturing of the “nation” whose coming into being was the desideratum of the anti-colonial struggle. Freedom of the “nation” from imperialist domination, far from being the over-riding objective, was no longer even a desired or a relevant objective for the government within a neoliberal setting.

This is the first instance of “fracturing” referred to above. Because of this fracturing, the criterion on the basis of which the government of a neoliberal regime takes decisions is not whether a particular stance defends national sovereignty, but whether it promotes the material interests of big capital which are considered identical with those of the “nation” in its new meaning.

Deafening silences
Siding with the US-Israeli alliance appears, on balance, more advantageous than standing with Iran, the victim of aggression, from the point of view of the interests of big capital in countries of the Global South. This would go some way to explain the deafening silences, mentioned earlier, in the UNGA and other resolutions.

There is also a second “fracture” brought about by the neoliberal regime. While the neoliberal regime is “sold” to the Global South as ushering in export-led growth that would bring about a higher GDP growth-rate for all countries compared with the earlier dirigiste regime, this claim is completely false.

Since the growth rate of aggregate world demand does not increase when more countries pursue an export-led growth strategy, the neoliberal regime that generalises this strategy among all countries is, in effect, forcing them to engage in Darwinian competition against one another, that is, to pursue a “beggar-thy-neighbour” strategy.

Some countries’ higher growth-rate than before under the export-led growth strategy, it follows, must be at the expense of other countries that now experience lower growth-rate than before.

Countries engaged in a race to outdo one another can scarcely be said to be “co-operating” with one another. The effect of a general pursuit of the neoliberal strategy, therefore, is a de facto abandonment of non-alignment, of a trajectory where countries of the Global South stood with one another to face up to imperialism.

Now, countries of the Global South, each obsessed with achieving higher GDP growth and hence, within the neoliberal paradigm, obsessed with drawing in larger metropolitan investment for this purpose, would rather curry favour with imperialism in order to outdo their neighbours.

This leads to a fracturing of the non-aligned movement, which is the second fracturing we mentioned earlier.

The silence of most countries of the Global South in the face of the US-Israeli aggression on Iran, which may appear puzzling at first sight, is not so puzzling after all.

Subverting both ‘nation’, ‘non-alignment’
Neoliberalism has been at work for quite some time in subverting both the concept of the nation and the concept of non-alignment, abandoning the anti-imperialist core that characterised these concepts, and substituting in their place alternative concepts that prioritise the task of currying favour with imperialism over everything else.

The outcome of this process is what we see today.

Capitalism is invariably hostile to any collective praxis against it, even if this collective praxis takes the form of just trade union action. It believes in atomising economic agents.

Neoliberal capitalism, which represents a return to unrestrained and uncontrolled capitalism once more, brings to the fore this tendency toward the atomisation of economic agents, through a break-up of the class alliance that had participated in the anti-colonial struggle, and through a subversion of the non-aligned movement that had stood for collective opposition by countries of the Global South to imperialist hegemony.

It is for the people of the Global South, not the governments currently promoting the interests of the ruling big bourgeoisie, to extend solidarity to the people of Iran. The struggle of Iran against the US-Israeli alliance is of crucial importance for recovering the sovereignty of the Global South.

Dr Prabhat Patnaik is professor emeritus, Centre for Economic Studies and Planning, Jawaharlal Nehru University, New Delhi. The views are personal. This article is republished from Newsclick.

Article by AsiaPacificReport.nz

Most government offices in the Marshall Islands began enforcing a new policy this week of closing by 3pm daily as a way to conserve fuel given uncertainties of fuel supply globally.

The move is to save energy and reduce the strain on the Marshalls Energy Company’s diesel fuel resources with both fuel shortages and skyrocketing prices seen on world markets due to the US and Israel’s attacks on Iran and its retaliation by closing the Strait of Hormuz to global shipping.

The 3pm daily closure directive for all non-essential government services was issued by the government’s cabinet on April 10 as an Emergency Electricity Savings Policy.

Aside from the government office closure to reduce energy use, the emergency directive is expected to help the private sector through the mandate of government contracts for air conditioning maintenance and repair.

Government offices are expected to remain open during the lunch hour, allowing workers to operate seven hours daily instead of the usual eight.

A key provision about the shutdown of government offices by 3pm daily is that they are required to shut off air conditioners, lights and any other equipment drawing power. The aim is to reduce energy use by 30 percent over the 90 days of the emergency decree.

The 90-day emergency order mandates the Marshalls Energy Company, the government’s power utility company, to provide detailed monthly electricity bills to every government ministry, state-owned enterprise, and subsidised agency that detail each government offices power consumption compared to the 30-day period immediately prior to the emergency declaration.

Compliance ‘mandatory’
“Compliance with the 90-Day Emergency Electricity Savings Policy is mandatory,” the declaration said.

“The National Energy Authority will monitor the monthly MEC baseline reports to verify progress toward the 30 percent reduction goal.”

Various exemptions are made to the requirement of shutting down by 3pm daily. All essential services are exempted from the closure order, including public schools, the College of the Marshall Islands and Majuro and Ebeye hospitals.

Secretary of Health Francyne Wase-Jacklick said the ministry was specifically exempted so there would not be disruptions.

“So essential services remain ongoing,” she said. “Outpatient, maternal child health, immunization, public health programs, and rehab services will continue as usual, with only internal adjustments to reduce energy use where possible.”

As a consequence of the 3pm daily closure of all non-essential government/agency/state owned enterprise offices, government workers will be working only 30 hours each week. They will, however, continue to be paid for a full week of work.

The 90-day Emergency Electricity Savings Policy would accomplish two things, Finance Minister David Paul said this week

‘Skyrocketing’ fuel costs
It was “an opportunity to cut down on energy usage” (while it) ⁠⁠allows people to maintain their purchasing power,” he said.

Paul said the situation with skyrocketing fuel costs had caused “an affordability crisis — so it will be counterproductive if we are trying to address a problem while creating another one.”

This is why workers will still get their full paychecks, he said.

The new 90-day Emergency Electricity Savings Policy is likely to have a positive impact on the private sector.

The new policy directs the Ministry of Public Works, Infrastructure, and Utilities to implement an “immediate transition” to contracting out air conditioning cleaning and repair services to the private sector.

“Air conditioning constitutes the largest draw on the public power grid,” said the new government emergency policy. Performance and quality of air conditioners, therefore, had a big impact on their cost of power to operate.

Public Works “currently lacks the capacity to service all government units”, the policy said.

Transition maintenance
To resolve this, the ministry is directed to coordinate with the Ministry of Finance to immediately transition maintenance responsibilities and facilitate the contracting of air conditioning cleaning and repair services to the private sector.

Further, the policy directs that “every government ministry, state-owned enterprise, and subsidized agency must allocate funds from their current budgets to hire private contractors for air conditioning repairs, maintenance, and cleaning.

While agencies are directed to transition maintenance to the private sector, they are also encouraged to explore all available avenues — including internal staffing or collaborative partnership with other agencies — to ensure units are serviced.”

A part of the emergency order requires that within the 90-day period of the order, “every agency must compile a complete inventory of their air conditioning units”.

They must also secure a maintenance contract and schedule to ensure filters are cleaned every two-to-four weeks. While physical cleaning of all units may extend beyond this 90-day window, the finalised contracts and schedules must be in place.”

This article is republished under a community partnership agreement with RNZ.

Article by AsiaPacificReport.nz