OnPoint by Keith Ng

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OnPoint: Taskforce 2025: A Space Odyssey

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  • Craig Ranapia,

    Part of this is because of our national psyche and tall-poppy syndrome: we don’t do enough to encourage or celebrate business success, and are openly hostile to people with wealth. Our heroes are mostly sportspeople.

    Well, except for Peter Jackson -- who was colossally ambitious (and often told that he was crazy) in his naive little dream that Weta was not only viable, but could foot it with the big boys in L.A. I don't think the guy has an "enoughist" cell in his body, and that doesn't make him a bad Kiwi.

    North Shore, Auckland • Since Nov 2006 • 12370 posts Report Reply

  • Sam F,

    Scott beat me to it more or less, but here's part of the relevant section from the actual NZTE report:

    Satisficing is the technical term for what we often refer to as the bach, boat and BMW phenomena. It is probable that satisficing, that can be described as the struggle between applying effort to creating more wealth and spending time and effort in leisure pursuits, occurs in all cultures. However it appears that in New Zealand leisure wins out at a lower threshold of wealth accumulation than in most other cultures.

    While this is an important issue, and the national cultural origins are supported by our research, satisficing cannot readily be altered by changing management practices so the aim embodied in this report is to create additional wealth without compromising our lifestyle ambitions, thus negating any adverse impacts of the habit and allowing us to make the most of the Kiwi lifestyle. That is, to create additional wealth from the same amount of effort.

    Auckland • Since Nov 2006 • 1609 posts Report Reply

  • ScottY,

    Well, except for Peter Jackson

    Indeed. The report isn't saying we don't have any successful people. We just don't have enough businesses making an impact globally.

    West • Since Feb 2009 • 794 posts Report Reply

  • Stewart,

    I try not to measure my life or its worth in $-value terms. Money is just so arbitrary.

    Te Ika A Maui - Whakatane… • Since Oct 2008 • 577 posts Report Reply

  • Sacha,

    The taskforce's woeful understanding of productivity is highlighted by that scanty passage Keith highlighted about the people component of it.

    Part of this is because of our national psyche and tall-poppy syndrome: we don’t do enough to encourage or celebrate business success, and are openly hostile to people with wealth. Our heroes are mostly sportspeople.

    As a result, our businesspeople don’t generally create large companies, take risks, or invest hugely in infrastructure and capital. So productivity suffers.

    Business investment in smarter systems and better management skills is essential. I'm unconvinced our widespread failure to do so is down to lack of praise for businesspeople. Pride in being good at it is another thing, however.

    Capital depth is a problem that seems hard to separate from both our poorly governed and enforced investment markets and our distorted penchant for unproductive real estate that comes with untaxed gains and writeoffs. The Aussie super fund has to be a major difference too.

    Amidst her despair at Key's lack of resolute ambition to reimpose the glories of the 80s and 90s, Fran O'Sullivan again trots out the tired neolib mantra that somehow cutting government spending and taxes will single-handedly improve private sector performance, just like that.

    The Brash taskforce inevitably pinged out-of-control Government spending as the behemoth which must quickly be slaughtered so that competitive tax rates can be introduced to give incentive for businesses, entrepreneurs and wage and salary earners to invest here and strive hard to build a successful future.

    This is a no-brainer.

    Uh huh.

    Ak • Since May 2008 • 19728 posts Report Reply

  • Danielle,

    we don’t do enough to encourage or celebrate business success

    Aren't we one of the easiest countries, regulations-wise, to do business in in the whole wide wacky world?

    are openly hostile to people with wealth

    I don't agree, since a bunch of people seem to have swallowed a whole lot of Business Round Table Kool-Aid in NZ, but if there is hostility, that could be because:

    we work longer hours than people in most other countries and are poorly paid by comparison.

    You dig?

    ETA: Danyl speaks truth below me, too.

    Charo World. Cuchi-cuchi!… • Since Nov 2006 • 3828 posts Report Reply

  • Danyl Mclauchlan,

    we don’t do enough to encourage or celebrate business success, and are openly hostile to people with wealth.

    I don't think this is true; we're hostile towards a lot of our top business people, but that's because most of them are evil thieves. Self-made guys like Bob Jones, Sam Morgan, Steve Tindall and (yes) John Key are widely admired.

    Wellington • Since Nov 2006 • 927 posts Report Reply

  • Rich Lock,

    Part of this is because of our national psyche and tall-poppy syndrome: we don’t do enough to encourage or celebrate business success, and are openly hostile to people with wealth. Our heroes are mostly sportspeople.

    As a result, our businesspeople don’t generally create large companies, take risks, or invest hugely in infrastructure and capital. So productivity suffers.

    I'm not convinced that that conclusion logically follows your initial statement. Most sucessful businesspeople have large enough egos that they generally don't give enough of a rat's arse about what people think about them for it to effect their business.

    You said 'part of this is because..'. I'd speculate that larger parts of the problem are the geographic isolation of NZ, and the small population, which directly effects both your workforce/pool of talent, and your market size.

    I'd don't necessarily disagree that NZ is punching below it's potential weight. I'm just not convinced by the arguments and conclusions to explain this that I've heard so far.

    back in the mother countr… • Since Feb 2007 • 2728 posts Report Reply

  • Craig Ranapia,

    Amidst her despair at Key's lack of resolute ambition to reimpose the glories of the 80s and 90s...

    God, every time I hear that I want to finally head-butt my desk into oblivion. I don't know if Fran was paying any attention, but folks found Labour's "John Key = Ruth Richardson in drag" mantra unconvincing for a good reason. You may say that's a bad thing, but let's not pretend some con job was pulled on the electorate.

    North Shore, Auckland • Since Nov 2006 • 12370 posts Report Reply

  • Stephen Judd,

    In my defence, I'm thinking of the business journalist summaries of the report -- I've only skimmed the thing itself. The summaries I have read basically amounted to "local employers are lazy and their employees are jealous."

    For me hostility to "people of wealth" (great phrase, with its echoes of people of colour, oh those poor oppressed rich) is most intense where it's most deserved: inherited privilege (eg Doug Myers), and corporate shenanigans (Brierly and Fay and Richwhite et al). I think we are far more tolerant of people who have built up productive enterprises that employ others.

    [edit] yeah, what Danyl said.

    Skimming the report it seems that its brief is cultural factors, which excludes the very important scale issue. When just the barrier between us and Australia is so challenging, it's not surprising that people grow their businesses to city or NZ scale and then stop. A business in a country of 10s of millions of people has completely different growth options to a business here, no matter how hostile or friendly the populace are to wealthy people. This is always going to put the "satisficing" balance at a different point to where it might be for someone in a bigger market.

    Wellington • Since Nov 2006 • 3122 posts Report Reply

  • Sacha,

    Ooh, O'Sullivan's stablemate Rudman goes for the jugular.

    Have faith in this medicine, says Dr Brash, and the gap will close. Trying to explain why these drugs didn't work the first time round, the taskforce claims "the reforms of the 1980s and early 1990s represented a very significant step forward" but "the pattern of policymaking over the last decade defies the well-established international evidence about what works. So it is no real surprise that New Zealand is not doing better."

    But a comparative study of economic policy and outcomes in Australia and New Zealand since 1984, published in the June 2006 Australian Journal of Political Science suggests just the opposite. Auckland University Professor of Economics Tim Hazledine and Queensland University fellow in economics and political science John Quiggin say the medicine served up by task force member David Caygill as Labour Finance Minister in the late 1980s, and by his predecessor Roger Douglas, and successor, Ruth Richardson, is the cause of the wage gap, now standing at 35 per cent.

    Ak • Since May 2008 • 19728 posts Report Reply

  • ScottY,

    I don't think this is true; we're hostile towards a lot of our top business people, but that's because most of them are evil thieves.

    In saying that didn't you just prove my point?

    Aren't we one of the easiest countries, regulations-wise, to do business in in the whole wide wacky world?

    We are, but the regulatory framework is only one factor in the success of a business. There are plenty of countries with more regulation than our own and that do better than us. Like Australia.

    Business investment in smarter systems and better management skills is essential. I'm unconvinced our widespread failure to do so is down to lack of praise for businesspeople. Pride in being good at it is another thing, however.

    Capital depth is a problem that seems hard to separate from both our poorly governed and enforced investment markets and our distorted penchant for unproductive real estate that comes with untaxed gains and writeoffs. The Aussie super fund has to be a major difference too.

    Nobody is claiming we can magically transform our economy by suddenly treating our business leaders as heroes. But there's no question a widespread disdain for businesspeople (as evidenced by some of the comments in this thread) creates a disincentive for some people to try harder.

    No question the tax incentives to invest in real estate aren't helping.

    You said 'part of this is because..'. I'd speculate that larger parts of the problem are the geographic isolation of NZ, and the small population, which directly effects both your workforce/pool of talent, and your market size.

    Geographical isolation and distance to market are not the problems they used to be. Australia is also distant to most of its markets, but does better than us. And with the development of new communication technologies, we should be doing better. We aren't. And I'm not sure how relevant small population size is. Other countries with small populations do better than us. It may be a factor, but I'm not sure it is a large one.

    West • Since Feb 2009 • 794 posts Report Reply

  • Danyl Mclauchlan,

    Okay, someone explain this to me.

    Brash, Fran O'Sullivan et al are insisting that cutting spending back to 29% of GDP is no big deal, since that's what it was in 2005, and that this would allow the government to cut taxes to 20%.

    The thing is, all of our taxes were a lot higher in 2005 than they are today. I know we ran surpluses and that we have costs like WFF and interest free loans, but those numbers still don't quite add up to me. I suspect there's a scam or a bait and switch somewhere - but where?

    Wellington • Since Nov 2006 • 927 posts Report Reply

  • George Darroch,

    My suggestion: reinstate compulsory penal rates.

    If we want productivity, then it makes sense to have workplaces try and squeeze more of it out of less hours. If they can't do it in 40, then they're not trying hard enough.

    Of course, Brash's mob was the lot that got rid of them, and "Labour" showed no inclination to reinstate them in 9 long years.

    WLG • Since Nov 2006 • 2264 posts Report Reply

  • Danielle,

    But there's no question a widespread disdain for businesspeople (as evidenced by some of the comments in this thread) creates a disincentive for some people to try harder.

    OK, a) I don't think there is a widespread disdain for businesspeople, just asshole ones; and b) even if your assertion is true, why is it our responsibility as a nation to tend their fragile self-esteem? No one gives me a ticker-tape parade for doing my job, and somehow I manage to struggle on regardless. The motivation is in the job itself (sometimes) and the eventual financial reward (always), not how many people slap me on the back for it.

    Charo World. Cuchi-cuchi!… • Since Nov 2006 • 3828 posts Report Reply

  • George Darroch,

    My suggestion: reinstate compulsory penal rates.

    If we want productivity, then it makes sense to have workplaces try and squeeze more of it out of less hours. If they can't do it in 40, then they're not trying hard enough.

    Of course, Brash's mob was the lot that got rid of them, and "Labour" showed no inclination to reinstate them in 9 long years.

    WLG • Since Nov 2006 • 2264 posts Report Reply

  • giovanni tiso,

    But there's no question a widespread disdain for businesspeople (as evidenced by some of the comments in this thread) creates a disincentive for some people to try harder.

    And surely the problem is whether we are entreprenurial enough, not how we feel about businesspersons. Because so long as there's no dearth of people who want to be self-employed and employ others (I seem to recall that's documented to be the case), and the conditions for doing business are favourable (which they are), I have trouble picturing a businessperson being stifled by this supposed disdain.

    'I might as well just middle it... they're not going to like me anyway!"

    Wellington • Since Jun 2007 • 7473 posts Report Reply

  • ScottY,

    OK, a) I don't think there is a widespread disdain for businesspeople, just asshole ones;

    I read and hear a lot of unflattering stuff spoken about people with money. Some of it is deserved, but not all of it.

    Michael Cullen's "rich prick" comment about John Key is one of the more obvious examples.

    BTW, I'm not suggesting we get the hankies out and start weeping for the poor dears. But the widespread disdain goes some way to explaining why many business people "satisfice".

    To be fair, the idiotic 2025 report probably doesn't help, and probably convinces a few people there is some evil big-business agenda to eat our babies.

    West • Since Feb 2009 • 794 posts Report Reply

  • George Darroch,

    New Zealand is one of the most unequal of all developed nations. I think that a good number of poor people actually resent being told to celebrate rich people. I know I do.

    WLG • Since Nov 2006 • 2264 posts Report Reply

  • Craig Ranapia,

    Ooh, O'Sullivan's stablemate Rudman goes for the jugular.

    Wow -- if you're going to be at Emma's book launch tonight, you might like to ask my partner how much stock he puts in Rudder's analytical skills, at least when it comes to pontificating on rail and public transport. It won't take long.

    North Shore, Auckland • Since Nov 2006 • 12370 posts Report Reply

  • ScottY,

    I think that a good number of poor people actually resent being told to celebrate rich people. I know I do.

    But if someone has achieved wealth through creating a successful business, then chances are they're probably also creating jobs and income for the country.

    If they just inherited a bundle, or got rich playing the markets, then screw them :)

    West • Since Feb 2009 • 794 posts Report Reply

  • Kumara Republic,

    ScottY:

    BTW, I'm not suggesting we get the hankies out and start weeping for the poor dears. But the widespread disdain goes some way to explaining why many business people "satisfice".

    To be fair, the idiotic 2025 report probably doesn't help, and probably convinces a few people there is some evil big-business agenda to eat our babies.

    Geroge D:

    New Zealand is one of the most unequal of all developed nations. I think that a good number of poor people actually resent being told to celebrate rich people. I know I do.

    The venerable Brian Gaynor speaks for most if not all of us; for him, the disdain towards NZ business leaders seems to be a post-1987 thing. The article's from a few years back, but it still rings true today. (My emphases in boldface.)

    New Zealand's leading business people are held in low regard because of their poor performance over the past 15 years.

    The lack of respect is not due to envy or the tall-poppy syndrome. Respect has to be earned, and the top end of the business community has eroded its support over the past decade and a half.

    It was a very different story in the late 1970s. There was the occasional rogue businessman at the time but most - they were all males at the time - were highly respected.

    And around the same time as the above, Pete Hodgson hit the nail on the head when he effectively attributed the issue to anti-intellectualism.

    NZH - Let 'nerds' drive us all into future

    The southernmost capital … • Since Nov 2006 • 5433 posts Report Reply

  • BenWilson,

    I think our extreme remoteness is most of our problem in terms of pay equivalences. We are even more remote than Australia, which constantly complains of the same thing. It's nothing to do with resources and management, and just the fact what we're so damned far away from everyone.

    Any time I play any kind of strategic game that involves building up some kind of infrastructure, I notice that the cities or towns at the edge of the map always lag behind everything else. Stuff near the center flourishes because of the other stuff near the center, and because it's older, it's been developed earlier, for longer.

    It really is that simple, I think. I still like this place. Wealth isn't everything.

    Auckland • Since Nov 2006 • 10654 posts Report Reply

  • Gareth Ward,

    The thing is, all of our taxes were a lot higher in 2005 than they are today

    I've asked this question in a few places - but nobody's been able to answer it (or even begin to engage in it).

    Auckland, NZ • Since Mar 2007 • 1727 posts Report Reply

  • Stephen Judd,

    DeepRed, thank you for linking to that old Gaynor article -- it's a pearler.

    ScottY: I've read that report more closely now, and I don't find too much to disagree with in its prescriptions, quite honestly. If I were the author, I would be annoyed with the media coverage which devoted a lot of space to presenting our local culture as problematic, but very little to his recommendations about working with the culture.

    Wellington • Since Nov 2006 • 3122 posts Report Reply

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