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ACT's The Letter - Monday, 24 November 2003

The Letter

Monday, 24 November 2003

Last week ACT Leader Richard Prebble gave three lectures in Canada.


Fifteen years ago, Canada was running huge deficits and debt had reached 100 percent of GDP. Canada signed a trade agreement with the US (their CER), deregulated state trading institutions, introduced GST and cut tax - a mild Rogernomics. The result: deficits have become surpluses; Canada is one of the OECD’s star performers.


A Liberal government that campaigned to roll back these reforms defeated Brian Mulroney’s Conservative government, then kept them. The Conservatives have not known how to respond, and then split. French-speaking Quebec complicates Canadian politics – as Maori seats, to an extent, complicate ours. Former Finance Minister Paul Martin, who insisted the Liberals continue with fiscal prudence, will succeed PM Jean Chrétien in December (the two don’t like each other).


Parallels with New Zealand continue. Chrétien made anti-Bush statements and refused to support the Iraq war. Canada is now without influence with its most important trading partner. Like New Zealand, Canada is contributing to Afghanistan and Iraq, but without the reward of having been there early. Failure of the World Trade and NAFTA talks means Canada has little influence in the world.


The Economic Freedom of the World 2003 report (measuring 2001) puts Canada at number 6, New Zealand at 4, but the US is at no 3. The Fraser Institute surveys every US state and Canadian province economic freedoms and shows a remarkable relationship between freedom and business growth. Every US state is economically freer than every Canadian province and is growing faster; the exception is Alberta, which is the freest Canadian province and fastest growing.


Canadian healthcare is a huge issue. There are no private hospitals or health insurance. Waiting lists, like in New Zealand, are growing. Like New Zealand, the Government response was to lie, publishing waiting lists understating the real delays. For 13 years, the Fraser Institute has surveyed doctors and published the real waiting lists, making health the top issue. This years survey concludes: “that waiting times for treatment in Canada continues to grow... Even more discouraging is evidence that provinces that spend more on healthcare are not rewarded with shorter waiting lists. Only substantial reform of the regime will alleviate the medical system’s most curable disease – longer and longer waiting lists”.


Faced with a Liberal Party that has moved to the Centre (as the Clark Government has done in New Zealand), how does the Centre-Right respond? The Progressive Conservatives tried Bill English’s approach, with even less success. A new pro-free enterprise party, called the ‘Alliance’ (ironic) advocates more freedom, and has been more successful, but under a two-party system, the Centre-Right split has been disastrous. The Conservative and Alliance Parties have just agreed to merge.


The belief in the individual, in private property rights, free enterprise, the rule of law and democracy – is winning. The Left can only win by adopting liberal policies.

The US economy’s success is such that the US share of the world’s GDP has increased to 30%. The 7% increase in the US economy in the last quarter is going to have a positive effect on the world economy and New Zealand, as a trading nation, will also benefit.


The Letter was not surprised by a Herald/Auckland Chamber of Commerce survey of 500 businesses that showed ACT had the best understanding of business needs. ACT and National were the only parties to receive a positive rating.


Following a spate of dog attacks, Labour tripped over itself to bring in more dog control regulations. It proposed access fencing from the street to everyone’s door so the family pet could not savage burglars. They proposed micro-chipping all dogs, starting in 2006, and it seems they even wanted leashes on sheep dogs working a mob of sheep along a country road. These more ridiculous provisions were dropped by Select Committee. In passing legislation, however, Labour over-ruled the Committee’s recommendations. It is insisting on universal micro-chipping and the breed-specific bans, against all expert advice. New Zealand has 500,000 dogs – at $25 for chip and insertion, we have some $13.5 million of unproductive cost, excluding the considerable ongoing administration costs that will be involved. Labour over-reacted, and we all face extra costs and more regulation.


United Future can now add another to its list of 'coalition' partners. There's been the Ethnic Minority party, Future New Zealand, Advance New Zealand, the Conservatives and now he's jumped in with the Outdoor Recreation Party. Rumours abound that United Future is struggling to attract the 500 members it needs to remain a registered political party.


The Letter is fixated by the All Blacks like the rest of the country. Should John Mitchell go? To vote, go to We will send the results to the New Zealand Rugby Union.


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