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Why the Greens’ Charm Offensive Failed

Why the Greens’ Charm Offensive Failed

Last week the Green Party invited representatives of business to a briefing aimed at demonstrating that there was no reason to be frightened about its influence on the new government.

The so-called charm offensive did not succeed. Why? Some commentaries, such as a Dominion Post editorial, wrongly put the failure down to an uncompromising attitude on the part of business and an unwillingness to consider green views.

In fact Green policies are well understood by business groups and some of them line up, such as the party’s opposition to the Cullen superannuation fund.

However, the Greens do not have a monopoly on environmental concerns.

I have been a member of an environmental organisation, and no one I know in business is against sound environmental policies. All other parties have environmental policies: the issue is which are best.

While the initiative was welcome, Green Party policies need to be examined rigorously.

A common view of greens generally is that they are well-intentioned and at worst harmless, if somewhat utopian in their ideas.

There is no basis for complacent assumptions. Many green crusades have been responsible for human misery and environmental damage.

A classic example is the campaign against DDT. Despite massive evidence that DDT was not harmful to humans or wildlife, the ideological ban on its use in many countries led to a resurgence in malaria and an estimated 50 million deaths. South Africa has gone back to using DDT and deaths have fallen away.

Greenpeace’s infamous campaign against the disposal of the Brent Spar oil platform at sea led to its disposal on land at greater economic and environmental cost.

Greenpeace founder Patrick Moore has written that the environmentalists’ campaign against biotechnology in general, and genetic engineering – an environment-friendly technology in many respects – in particular, “has clearly exposed their intellectual and moral bankruptcy”.

GE is an example of green ideology at work in New Zealand in place of evidence-based policy. The Greens refused to accept the advice of a Royal Commission set up at their behest that New Zealand should avail itself – cautiously – of this new technology.

Other Green arguments are demonstrably wrong as a matter of simple economics.

One example I gave at the briefing is the proposition that a natural disaster, like Hurricane Katrina, adds to GDP because of the need to spend money on goods and services to repair the damage. A moment’s thought indicates why this is absurd – would several Katrinas be even better for GDP? Of course not – investment worth billions of dollars in houses, businesses and infrastructure was destroyed, and the resources being diverted to restoration would otherwise have been put to more highly valued uses.

Another is the proposition that reduced import protection is a cause of New Zealand’s large current account deficit, hence the Green’s policy of increasing tariffs and opposing free trade agreements. There is no empirical relationship between a country’s current account position and its level of tariffs, which are a tax on exports as well as imports because they raise domestic costs.

Other Green policies that would be economically damaging, especially to the poor, include ‘smart growth’ restrictions on land supply that push up the costs of housing, and a $12 minimum wage which would price many lowskilled workers out of jobs and make them dependent on welfare benefits that are set well below the present minimum wage.

Another iconic green policy, the Kyoto Protocol, would impose large economic costs for negligible environmental benefits, as even its supporters acknowledge. The Greens seem unwilling to accept that Kyoto is not going to happen – one country after another looks set to ignore its commitments – and that the US approach to global warming, based on research and technology, is likely to carry the day.

Too often greens were largely missing in action in debates that economic reformers also saw as having environmental benefits – the abolition of fertiliser subsidies, Think Big, the ITQ system for fisheries and producer board reform are examples.

Today they are not to the fore in pushing for economic pricing, markets and commercial operation in water and roading. The Greens have blocked sensible reforms to the RMA to give better protection to property rights and require compensation for takings. They seem unwilling to engage with well-documented criticisms of doom-mongering, such as the work of Julian Simon and Bjorn Lomborg.

Unfortunately, Green Party representatives at the briefing did not reveal a readiness to rethink flawed arguments. Greens elsewhere have shown more willingness to move on from outdated positions, recognise that economic growth and environmental improvement usually go hand in hand, and put more emphasis on market-based solutions to environmental problems instead of central planning and regulation.

Such an evolution in Green Party thinking here, better analysis and a sharper focus on New Zealand’s real environmental problems would make for a more productive dialogue with business.

Roger Kerr is the executive director of the New Zealand Business Roundtable.


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