July 24 2007

Time for NZ media to apologise to exporters, mortgage-holders

The Fourth Estate is a term given to the media in recognition of the fact that it is an active participant or branch in our democratic processes.

Just as the democratically-elected Parliament or the independent legal system impact on peoples' everyday lives, so do the media by their daily choices of what to report, what to highlight and what not to report.

For at least five or six years the media - TV and newspapers especially - have literally run a campaign demanding Finance Minister Michael Cullen "give back" the surplus.

The government's surplus, it needs to be equal to around 3%-of-GDP a year to fund contributions to the New Zealand Superannuation Fund, has been running higher than that - to the endless derision of the media.

When have we had a Budget in recent years in which the Dominion newspaper, the NZ Herald newspaper and the TV news "reporters" did not tell Kiwis that the Labour-Progressive government was hoarding surpluses and should give it back in big across-the-board income tax cuts?

Those surpluses represent the government taking more money out of the economy than it is putting back into it - because we are putting the money away for the future costs of NZ Super, in capital investments like rail, transport and energy or transfers targeted at working families - because they most need tax relief.

Yet now almost every economist in the country is predicting the Reserve Bank will put up interest rates again this week, and perhaps again in September, because the domestic economy remains too strong and because the rate of inflation in domestic sectors of the economy has been too strong for too long. There has been, in short, too much demand in the economy.

It is time for the partisan, historically illiterate mass media to apologise to New Zealanders for misleading them for years on an issue which is now of critical importance to the health of our exporting industries. The truth, it turns out, is that the government should in fact have been running bigger surpluses; it should have been taking even more heat out of the domestic economy than it has been.

At least media is giving coverage to some alternate views

At least some media have started to give some coverage to alternative viewpoints on how we can take some of the pressure off from those export sectors that are hurting under the high interest rate/high NZ dollar regime.

Radio New Zealand ran a feature on Professor Steve Hanke from Johns Hopkins University who believes that New Zealand should abandon its free-floating exchange rate and peg it to a key larger currency such as the US dollar, or a basket of currencies, in a manner similar to the approach of Hong Kong.

He said that the evidence after 20 years of Roger Douglas/Don Brash's regime of having monetary policy focused on inflation rate-targeting, combined with a free floating exchange rate, is that the theory simply does not work in practice.

We have been through similar inappropriate cycles over the last 20 years and the height of each cycle has done unnecessary damage to the productive capacity of our exporters.

For Progressives, this debate is painful.

Our original party, the NewLabour Party, broke away from Labour in 1989 not only over its strategic asset fire-sales programme and massive tax cuts for the rich, but also because we argued that having monetary policy solely or primarily focused on an annual rate of inflation (originally set at zero to 2%) was not practical, could cause unnecessarily wild swings in interest and exchange rates and do irreparable damage to manufacturing employment.

So Progressives welcome this national discussion which we must have. We firmly believe there is a strong positive role for a progressive government to intervene to take pressure off the domestic side of the economy:

One step would be to significantly increase the funding for the supply of house-building and renewable energy production, such as hydro and wind power. If the prices of housing and electricity are going through the roof, we believe progressive government acting for all New Zealanders should run big surpluses in order to fund more home building and electricity production.

That, of course, would mean that there would not be the slightest prospect of big income tax cuts - which would add to domestic demand. You have to vote for National and ACT for the policies which would mainly benefit the overseas lenders, but hurt most New Zealand families.

http://www.nzherald.co.nz/category/story.cfm?c_id=34&objectid=10452541

NZ media coverage of ACT Party

Because I have been overseas for the last month I have had to rely on the website versions of the newspapers and other outlets instead of turning on the TV or picking up the paper for NZ news.

And, you know, one thing that really struck me is how much media coverage the ACT Party gets.

"Act has every reason to be optimistic about the election next year," the NZ Herald website told me in a story on 8 July.

On 9 July, the NZ Herald had an article on members' views on the ACT Party's new co-operation agreement with the Labour Party.

On 10 July, the NZ Herald even had an Editorial dedicated to the ACT Party. It basically served to warn Mr. Hide that should he work with the government to advance Australasian regulations over so-called therapeutic products - then, well, then, "many National supporters must question whether Act is worth saving."

(I was surprised by that because for literally decades the NZ Herald has run literally thousands of stories on business leaders demanding Australasian-wide standards and regulations - because that reduces businesses' costs of doing business in both markets.)

"National's leaders, seeing Act willing to provide the final drops of oil to lubricate Labour policies, may feel far less inclined to entertain its policies when they hold power. If so, Act will cease to matter as a political influence," the editorial continued.

An interesting perspective. When did ACT matter as a political influence? I thought ACT had been in Opposition since the day it entered Parliament in 1996. It held neither influence in the National-led government of 1996, not the Labour-led governments since 1999.

On 20 July, the NZ Herald told us that Act won a "significant victory in Parliament" by somehow forcing a victims' rights amendment to be incorporated into the Criminal Justice Reform Bill.

I cannot understand this last story - it doesn't tell us how the vote went. But if it is true that the Criminal Justice Reform Bill is only being advanced with ACT support, then it is meaningful. But if what actually happened is that NZ First changed its position, then the story is just ACT propaganda i.e. ACT's "spin" on what actually happened and completely confusing to readers wanting to understand what is actually happening in their Parliament.

So how much support does ACT have again?

There is only one other big newspaper owner in the country, the Australian-owned group that produces papers like the Dominion in Wellington, the Press in Christchurch and the nationwide Independent business newspaper.

When I am in Auckland, I don't see these papers. But when overseas looking for news on New Zealand, I see them via the Web. The ACT Party gets equally strong coverage in those papers as well.

So how much support does ACT have? In the 2005 Election, ACT got 34,469 votes compared with the Progressive Party's 26,441 i.e. 1.5% of votes cast versus 1.2%.

In the latest Roy Morgan Poll (published on 11 July, 2007) ACT registered 1% support versus the Progressive Party's 1%. In the TVNZ July 5 poll, ACT registered 0.3% compared with 0.4% for Progressive. (In the electorate vote, Progressive was 0.8% versus ACT at 0.2%).

So given that there was just 0.3 of a percentage point in difference between ACT and Progressive's 2005 election result, and nothing in the polls between the two parties now, and that Progressive is represented in Cabinet and in key portfolios, and therefore actually contributes to government decisions, of course you would expect at least equal coverage in the media for Progressive, right? Yeah Right!

Auckland Progressive conference

The media have for as long as anyone can remember been a partial participant in the political process in New Zealand.

The nutty ideas of the extreme right wing ACT Party will always get a much better run on TV and in the newspaper than practical policies implemented by the Progressive Party which benefit working families.

It just means that we need to do what we did last election - get a percent point more than the polls put us at. We need 1.3% of the party vote to get 2 M.P.s and 2.5% for 3 MPs.

Auckland Regional Progressive Party Conference (Buddhist Centre, Eaglehurst Road, Saturday August 25) marks the start of our efforts to get the issues we want to draw public attention to, really try for the first time to seriously tackle a National-held seat by comparing the record of National in government to the Labour-Progressive government, and to get the systems to place to aim for more party votes next year.

ENDS

© Scoop Media