Polity by Rob Salmond


Home-spun non-truths

This post is about where “the things we think we know” come from, and what happens when they’re misused.

 The “$38 billion” man

Readers may have seen Labour is investigating the merits of changing New Zealand’s tax and welfare policy to incorporate a Universal Basic Income. A change like that is hugely complex, and I know Labour is far from decided.

Enter David Farrar. Yesterday he decided he can put a cost figure on this policy, despite nobody having said what the policy is. Here’s his headline:

Labour’s $38 billion bribe!

 Ohmigod! $38 billion! That headline sounds massively expensive. But it’s also utterly, hopelessly dishonest.

UBI policies are based on providing everyone a basic income, but reducing welfare entitlement and increasing tax rates on added income to compensate. David Farrar’s $38 billion figure is only true if you provide everyone with a basic income but you make absolutely no changes to either welfare entitlements or tax rates.

That’s like calculating National’s tax switch policy in 2010 was a “four year, $18 billion bribe,” by just excluding the GST rise from the calculations. Ludicrous. Imagine the gnashing of teeth and proclamations of economic illiteracy that would follow if I did that, including from a certain David Farrar.

Later in the article, Farrar does concede the cost would cut in half if you altered welfare entitlements as part of the package. But that didn’t stop him sticking the much bigger figure in the headline. Once you also factor in tax change (beyond the cartoonish example Farrar uses), the cost can be near zero, with many wage-earning taxpayers coming out ahead, only a few coming out behind, and massive efficiency savings in the public sector because you don’t have to spent so much time and effort enforcing labyrinthine benefit rules.

Now, David’s a smart guy, and he’s completely aware how UBI works. He was just more interested in generating a large-sounding number than in telling the truth.

Somehow the editorial staff at the NBR missed this obvious dishonesty, and reposted Farrar’s article on its website, screaming headline and all. That’s shoddy journalism.

Labour’s Asians lost?

So what happens when one of these not-true-home-truths becomes ingrained? Well, a small corner of Tracy Watkins’ weekend column provides a clue. In this post I’m not taking any particular issue with Tracy’s assessment of Labour’s performance last week – certainly it was a tricky wee period. I’m taking issue an important, but false, asserted fact:

Labour used to have a stranglehold on the ethnic vote. No more.  

(By “ethnic” here, by the way, Watkins means “Asian.”)

Both elements of that statement are false, and one of the country’s leading political journalists should know her history better than this.

Did Labour used to have a “stranglehold on the ethnic vote?”  No.

When Labour last won an election, in 2005, it got 41% of the vote overall. It’s vote in the Asian community was 44%. There’s almost no difference.

How about more recently? In 2014 Labour got 25% overall, and 29% of the Asian vote. Again, there’s almost no difference between overall performance and performance in the so-called “ethnic sector” Again, Labour’s performance is better in the Asian community than elsewhere.

Very little has changed in this dynamic: Labour’s a bit – and only a bit – more popular in the Asian community than elsewhere. Labour’s long-term problem since 2005 has been a fall in popularity generally, not a particular problem among Asians.

Once these tropes get hold, they can lead to poor decisions. “You can’t think about UBI – it costs $38 billion!” leads to people ruling out a potentially helpful policy innovation based on malevonent lies about how policies work.

Similarly, “we’ve been disproportionately bleeding votes from this particular ethnic group” leads to overly-narrow political strategy, based on benevolent ignorance about vote history.

I’ve learned to expect this kind of manufactured-made-up-trope from David Farrar and Cam Slater and other tools of National’s publicity machine. But it shouldn’t take someone like me to point out when its been making it up. That’s the fourth estate’s job, too, yeah?

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