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Self-Evident Truths And Black Swans

Self-Evident Truths And Black Swans

Hon Heather Roy, ACT Deputy Leader
Saturday, February 27 2010

Hon Heather Roy speech to the ACT New Zealand National Conference 2010; Wellington College, Dufferin Street, Wellington; Saturday, February 27 2010.

ACT President Michael Crozier, Board members, Parliamentary colleagues, ladies and gentlemen.

One of the best-known quotes in the English language is that found in the US Declaration of Independence, which says: "We hold these truths to be self-evident." The document goes on to say that all people are created equal and possess certain inalienable rights including life, liberty and the pursuit of happiness. Without doubt, this could be the ethos of the ACT Party and reminds us that we embrace a tradition that is more than 200 years old.

Discussions about vision, strategy, goals and brand have dominated the ACT Party for as long as we have existed. They are all important debates to be had but, at the mid-point in this electoral cycle, it is far more important - in order to prepare ourselves for the 2011 election and beyond - to go back to first principles; to self-evident truths.

Today I intend to do just that, with the intent that this will provoke wide and healthy debate and form the basis for a constructive campaign separation strategy from the other Parties in Government. I wish to start with three fundamental questions - who are we? Why do we do what we do? Where are we headed?

To many of you, these may seem like rhetorical questions and as self-evident as my earlier quote from the US Declaration of Independence. However, being part of Government for the first time has brought about many compromises; some pragmatic and some profound, but all inclined to obscure our unique role in the political landscape.

Who are we? What is our identity as a group?

It is usual for commentators and the public alike to cite the formation in 1993 of the Association of Consumers and Taxpayers, or the opportunity provided in 1996 by MMP as the answer to these questions. Our early by-line 'freedom, choice and personal responsibility' would be the response of many. Some will quote the doyens of classical liberalism in the 19th and 20th Centuries to explain what ACT stands for. However, our whakapapa can be traced back many more centuries. In understanding ACT's identity - in understanding ourselves - we must recognise that we represent, politically, the fundamental and constitutional principles established in documents that transformed the world, such as the Magna Carta - The Great Charter of Freedoms - in the 13th Century.
Why do we do what we do? The answer to this can be found in those same founding documents. Our political ethos is based on the passionate defence of economic and social freedoms. In the case of the Magna Carta these include personal freedom and safety, due legal process, property rights, fair trade and protection from corruption.

Where are we headed? There is no doubt in my mind that being part of the Government has benefited us. We have transitioned from being simply a 'Party of Ideas' to seeing many of our political aspirations either implemented or in train. However, this has not come without cost. Our poll ratings remain low at a time when our media profile is high. Minor parties traditionally bear the electoral consequences of unpopular decisions by Government and their achievements are often claimed by the major Party. We can be - and have been - caught up in negative public sentiment over the actions of other MPs and other Parties. As Owen McShane says, New Zealanders love government but also hate politicians and political Parties.

As part of a conservative-led Government, we in ACT want to see bolder economic reform. Of equal or greater concern, however, is the difficulty of maintaining our socially liberal perspective under a supply and confidence agreement with the National Party. We risk being portrayed, to amend the American journalistic acronym, as L.I.N.O. - 'Liberal in Name Only'. Each and every one of us has to face the challenge daily of ensuring that we are not cast as representing something other than the founding principles on which ACT was formed.

I am pleased to have entered Parliament eight years ago as an Opposition MP. It was a hard apprenticeship, but one that prepared me well for my time as a Government Minister. I acknowledge, as I did at last October's Auckland South Regional Conference, that some of you may feel frustrated that you have not seen as much of your Parliamentary team as you have in the past. However, I also know that you appreciate seeing implementation of, or progress on, many of the initiatives that we have campaigned tirelessly for over the years. These include the Aspire Scholarships for Independent Schools, an Inter-Party Working Group Report for School Choice, a Special Education Review, a Defence Review and a consolidation of consumer law to mention just those within my portfolio areas. I am confident that these initiatives will result in improvements in efficiency and productivity.

Given the increased Ministerial workload, I was delighted when David Garrett accepted the vital but time-consuming role of Party Whip late last year. It is a core role of leadership to ensure that a succession plan is put in place and I'm sure that he has the ability to serve the Party effectively in this job.
I am particularly proud of belonging to the ACT Caucus. Roger, John and David have borne the brunt of House duty when Ministerial and other duties have resulted in Rodney and I being away from Parliament.

Roger has kept the pressure on the Government regarding economic reform and willingly took on my Voluntary Student Membership Private Member's Bill. He now also has his Bill on Minimum Youth Wages drawn for consideration.
John has been the stalwart of ACT's position on the electoral finance, anti-smacking and emissions trading legislations.

David has been the Party's voice for the 'Three Strikes' legislation, which we know will make a huge difference to the safety of all Kiwis.
Rodney's work in local Government - the subject of much current and, no doubt, future scrutiny - is an essential but time-consuming undertaking that will benefit all New Zealanders for generations to come.

But no matter how much patient hard work we put in, ACT remains vulnerable to unexpected events beyond our control. These are sometimes called 'black swans' after Nassim Taleb's bestseller 'The Black Swan': The Impact of the Highly Improbable.

A 'Black Swan' is the occurrence of high-impact, hard-to-predict and rare events that are beyond the realm of normal expectations. Despite our hard work and successes, we have already seen the black swans overhead. We will see them again before the next election.

Now, I'm sure that Lech Beltowski won't mind me pointing out that - as appealing as it seems - a 12-gauge shotgun is not going to help with this type of black swan. Taleb offers 10 principles for building resilience to black swan events. My favourite is "People who were driving a school bus blindfolded (and crashed it) should never be given a new bus."

What does that mean in practical terms? Holding an electorate seat and a couple of percentage points of Party Vote is not good enough. If all that our message is worth, in electoral terms, is drifting around between one and four percent and that - in order to achieve our aims - we are reliant on Rodney holding Epsom, then we are not free to choose very much at all! No company would base its future on such a premise. We must stamp out our electoral space in the same way that the Greens have on the other side of the political spectrum. That means at least eight percent of the vote. If we can hold one or more electorates, that should be a bonus - not a raison d'être.

So what is our way forward?

If we consider recent political history, then New Zealand voters are most unkind to the minority Parties in government. Since the beginning of MMP they have suffered disproportionately from any discontent with the governing coalition. Winston Peters and the Alliance both suffered this fate. Jim Anderton then invented the Progressive Party, which has now been quietly put to sleep.

So how can ACT escape the same? We start with some advantages.
Firstly, we are an ideological Party. The Alliance, United Future and most especially New Zealand First were simply vehicles for their Leaders' ambition. None of them could survive a change in leadership. The Greens and ACT are a different species. We agree on very little, but we are both ideological and are founded on principles.

Our second advantage is that there are now fewer third Parties around. The Alliance and New Zealand First have gone, and Peter Dunne holds his seat at National's pleasure. The Maori Party has recently emerged, but I can safely say that it does not hunt in our territory. Furthermore, the Maori Party is surprisingly often our ally. Past experience has told us that the New Zealand voter loves to split their vote and that is to our advantage.
Thirdly, there is a slow but profound change in how people get their news. The 'old media' of newspapers and television face increasing competition from the internet. The impact is greatest on the young. In online polls ACT does surprisingly well.

There are also, of course, many challenges. Many people cannot see the difference between the National Party and ACT. The differences are large because ACT is alone in thinking that people do better when they are largely in control of their own lives. Virtually every other Party feels that they have greater wisdom than the general populace, but differ as to what direction they should be pushed.

Most governments try to organise tax to maximise the tax take, although the last Labour Government organised the tax regime to maximise the Labour vote.

Only ACT wants a tax rate that would maximise economic growth.
But our problem of being seen as an adjunct to National isn't going to go away easily.

We have, of course, reserved he right to criticise the Government by taking posts outside of Cabinet. This allows us to criticise policy outside of our portfolio areas. So our problem becomes one of differentiating ourselves from National without destabilising government - back to my constructive campaign separation strategy.

But the National Party is naturally cautious and reform tends to be slow. The political problem with this is that the Government doesn't dictate the agenda. In this vacuum, credit card indiscretions by National Ministers dominate the headlines whilst Government spending spirals out of control to the tune of billions of dollars.

My own feeling is that we should stick to our principled policy positions and shout about them when all other Parties have lost sight of New Zealanders' core values. The anti-smacking and emission trading policies are examples of where this has happened already.

ACT has a number of policy positions that are unique, and we will continue to articulate them. But that doesn't mean the Government will fall. It won't be ACT versus National, but ACT versus all other Parties. If that equates to being seen as radical then, yes, I guess we are. To mean that simply means principled.

ENDS

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