Hard News by Russell Brown

Gordy's Lament

Earlier this week NZPundit's Gordon King bashed out an angry lament for New Zealand, wondering why we can't be more like Australia. If we don't go and beg to be a state of Australia, we will, apparently, wind up "tribal, corrupt and poor, just like all the other pacific island micro-countries."

Uh … what? We're heading off to Australia to escape over-regulation and corruption? Is this some other country called Australia with which I'm not familiar?

I'm sure he was just having a bad day - anyone who loves his daughter so much can't really be that bitter - but I do periodically get emails along the same lines, from people convinced that we suffer under the worst government in our history, that the economy's poked, and the whole country is going down the gurgler. Helengrad is, for them, the very symbol of the end-times. I wonder how they get out of bed in the morning.

And still the right-wing reality generator chunters on: one frankly deranged guy from Western Australia posted a comment to Gordy's lament ("I'm really sorry about what's happening to your country. New Zealand is running the worst economic, race-relations, and foreign policies anywhere in the Western world … What is happening in New Zealand? Does New Zealand still exist? Is it a third world country? Irrelevant to the Anglosphere, have they joined the African Union?") and a pointer to his so-called essay, which is a cut-and-paste of Don Brash's last speech. He urges all right-thinking New Zealanders to relocate to Australia while the borders are still open.

Crikey. Curiously enough, it's not long since the Melbourne Age published this story, noting that for the first time in eight years New Zealand is not the number one source of immigrants to Australia. Indeed, only half as many New Zealanders are moving to Australia as two years ago.

The paper's economics editor suggested that new welfare eligibility rules had had an impact, but also cited "boom times" in New Zealand. He said New Zealand's unemployment rate, at its lowest in 14 years, was "well below" Australia's, and amongst the lowest in the western world; our GDP growth, at four per cent, was the highest in the OECD. Britons, meanwhile, were fleeing a stagnant economy, and twice as many Australians were leaving for "greener shores" than 10 years ago.

That same week, there was of course, a large and fawning cover feature in Time magazine, about how "hot" we "cool Kiwis" are these days, and how we increasingly find our destiny at home rather than elsewhere.

So has anything much changed in the ten weeks since? And what of Gordy's key point - that the latest business confidence survey doesn't really count? He says:

Look into the figures a bit though and you see that it is in fact the retail and construction sectors that account for all the increase in confidence. The manufacturing and agricultural sectors are through the floor. So once again NZ is in the grip of a mini boom driven by high inwards immigration and a weak US dollar lowering import costs. The sectors that actually earn foreign exchange, the new money to be introduced into the system, are looking really shaky.

True, robust domestic confidence is, at least in part, being driven by the housing boom:

The survey of 1500 consumers found that growing numbers of New Zealanders feel better off, expect to be even better off next year and, as a result, consider this a good time to buy a major household item.

That is a big turnaround from the start of this year, when consumer confidence was in the doldrums …

Building consents are at their highest in 25 years.

But there's also this: in the three months ended June, average hourly earnings for wage and salary workers rose by 6.9 per cent compared with the June 2002 quarter. Inflation is running steadily at 1.5 per cent. We have price stability and wage growth.

It is true that, after a dream run, the export sector, and agriculture in particular, is less optimistic than it was a year ago - in large part because our dollar is so strong. But as this story shows, the overall movement in the last few surveys - from net 44 per cent pessimism in May (when everyone was worried about Sars) to only 3 per cent this month - is startling. A net 30 per cent of companies are now optimistic about their own businesses.

And maybe the farmers aren't quite as distraught as they sometimes like to crack on. See Delight down on the farm, again from this week's Business Herald. It says most businesses serving the rural sector have had "a solid year". Furthermore:

Throughout the rural sector it was important not to lose sight of the fact that things were still in significantly better shape than they were in the 1990s, Weenink said.

"Despite the lower prices, the returns - in comparison to the 90s - are still extremely good."

Results of a bi-monthly rural confidence survey released yesterday show farmers are increasingly optimistic in their outlook for the coming year.

The RaboBank/ACNielsen rural confidence survey for July and August indicated farmers' investment intentions are on the rise and there is greater expectation of increased income.

This is despite 86 per cent of respondents saying the rise in the New Zealand dollar has had a negative impact on their business.

Optimism was strongest among sheep and beef farmers.

Nearly two-thirds (almost twice as many as the last survey) now expect the rural economy to improve.

And then there's the recent strong sharemarket performance. To quote:

"I think there's confidence about the direction of the New Zealand economy. Most companies here are doing well - there's a bit of pain in the export sector but those in the domestic scene are strong."

So what of Gordy's introductory complaint - that marine farming is being killed off here and moving to Australia? He says:

They were pioneers in New Zealand's green-lip mussel industry and had been trying to grow the business here. But, as anyone in aquaculture knows, there is a ban now on new consents while environmental and cultural issues (Maori treaty claims) are settled. And even if the ban is lifted there will be expensive resource hearings, insane regulatory charges, repressive health and safety regulations, expensive cyto-sanitary and bio-security charges, and oodles of interest groups to be paid off before the marine farmer can drop his first spat laden rope into the water.

It would be unusual if would-be marine farmers weren't complaining about regulation. But the government's job is not to hand-feed mussel farmers. There are public interests at stake in the use of the shoreline too, remember? It is true that a two-year moratorium on new marine farming consents is in place. It was put in place with the aim of providing breathing space so that the regulations could be clarified.

No one seems to seriously disagree with the intention of proposed new rules, but as this commentary notes, the industry is growing impatient with the speed of progress, even given the unexpected appearance of a major complication like the Appeal Court's finding on the foreshores. Some believe that the deadline for the end of the moratorium - March next year - will slip. But it's hardly the industry holocaust Gordy suggests. Waikato is among the regions to have already specified a marine farm zone as proposed under the revamped regulations. The area is expected to generate a mussel harvest worth $40 million a year.

I could go on. But, really, it comes down to this: even if you believe that the good run of the last four or five years is entirely dumb luck on the idiot government's part, New Zealand has been outperforming most developed countries. No, future performance is not guaranteed, and we face significant challenges, but the economy - and consumer confidence in particular - has been bucking gloomy predictions for quite a few quarters now.

And it's a great place to live; which is why all those expats are coming back and buying expensive houses. True, right now, as Chad so nicely put it, the country needs a holiday from itself, but that's a seasonal thing. Summer is coming, and I'm in some degree of excitement about any number of things - the forthcoming Scribe album, the White Stripes playing next week, a not-too-bad-at-all All Black team for the World Cup, the Nick and Waverly storyline on Shortland Street, C4 launching tonight, the fact that Chad's nearly finished his new novel, the frankly amazing Clearview Estate 2002 Unwooded Chardonnay, Return of the King, and, not least, the way Public Address is going. There is, as the rugby league commentators are wont to say, a lot to like - about the people and the place.

So all this wannabe-Australian cultural cringe is just embarrassing. I mean, face it, how would you rather wake up in the morning? With some sense of pride along the lines drawn by the Time feature?

New Zealand is in the vanguard of a dynamic world - its human diversity, open spaces, wit, flexibility and sheer tenacity have taken rugged, isolated country and positioned it on the cutting edge of adventure, knowledge and creativity.

Or with a whinge and a cringe?