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Future Lefts: All over the world. To change it.

Future Lefts

Thursday 5th October, 2000.

All over the world. To change it.



Editorial: International solidarity
CSM referendum at Auckland University
Common currency? Or no common currency?
Web Site Of The Week


Editorial: International solidarity

I was lucky enough to be chosen by the Young Labour executive to attend the Asia-Pacific Committee meeting of the International Union of Socialist Youth (www.iusy.org) in Mumbai (Bombay), India. The meeting was 23-26 September, and funding was arranged by a German political foundation. Michael Collins, Young Labour's secretary who is overseas in Nepal, also attended the meeting largely at his own expense. The theme was `Democratisaion and Equality in the Asia Pacific Region', so besides giving country reports and preparing resolutions on a number of areas, the bulk of the meeting was a seminar focusing on those areas.

I'm not going to go into details here on the theme of the meeting, but rather want to explain what IUSY is. It's a federation of the youth wings of most of the parties in the Socialist International (www.socialistinternational.org) and has 130+ member organisations in over 100 countries. It acts as a link between national organisations, running coordinated campaigns, bringing pressure to bear on various abuses of human rights, repressive regimes etc. Like the Socialist International, IUSY is an organisation for democratic parties only - it's not associated in any form with state socialism or communist regimes.

What I found most interesting about the meeting was the very useful amount of networking that goes on at these functions. I had the privilege of meeting Soe Myint, for example, who is one of the leaders of the youth wing of Aung San Suu Kyi's party in Burma, and Rajendra Chaudhry, son of the illegally-deposed Fijian Prime Minister, amongst a crowd of about fifty people from 22 national organisations.

What was most heartbreaking about the entire event was the realisation that when you lift your eyes from the local struggle for socialism, there are countries where freedom is an imaginary state, and poverty is a reality that we wouldn't have any idea of here. In India, more than 400 million people don't earn enough money to feed themselves properly. In Burma, Bhutan, Malaysia, Singapore, Fiji and other countries in the region, basic rights and freedoms are ignored at every turn.

While our own democratic rights are secure in this country, it is our obligation to do all we can to help those whose are not. Solidarity and justice demand nothing less.


You will have noticed the lack of Future Lefts for some time now - in fact, the last issue is dated August 8. For this you have my apologies. I am in the process of passing off the publication to another member of Young Labour's executive; when that is complete, he will take over and there'll be some format changes. Until that time, I will continue to publish at least fortnightly. Unlike previous issues, this one looks more broadly at how the Government has been doing over the past two months, instead of focusing on the week that was.

Anyhow, welcome back.

Till next week,



CSM referendum at Auckland University

The University of Auckland is in the early part of a month-long referendum on whether membership of Auckland University Students' Association (AUSA) should be voluntary or compulsory.

October 1 to November 1 is the period of the referendum which is being run by postal ballot. All enrolled students as of September 19th have been sent ballot papers. The timing of the referendum, coming as it does in the last three weeks of lectures for the year and the first week of the study break, has caused concern, but the late referendum was only triggered after a last minute scramble for sufficient signatures for the University's September Council meeting to authorise it.

Compared with last year's referendum, campaigning to date has been relaxed, with none of the extreme competition that led up to last year's paper thin majority for voluntary membership. While AUSA has survived under VSM, it has become apparent that the Association's ability to lobby directly with the University has been fatally undermined.

Latest evidence of this has come with the University continuing to encroach on Student Association buildings, and the proposed construction of a Student Amenities Complex on the city campus that was roundly rejected by students in the late 1990's. AUSA President Kane Stanford made comments last week to the effect that the University only listens to AUSA "when it wants to."

It is also striking the extent to which the views of many student political leaders have changed over the past year. In the 1999 campaign, the vast majority of what one might call the "political elite" on campus backed voluntary membership. This year's campaign has been marked by a convergence of views that the voluntary experiment has not lived up to expectations. This is reflected in the relative size of the activist cores backing each campaign, which has approximately reversed since the 1999 referendum.

While it is too early as yet to make any prediction as to the final outcome, Future Lefts speculates that the decision will be in the fickle hands of the students who are not members of AUSA today. Either they won't vote, or they will vote to keep the status quo, or the compulsory campaign will convince them that a voluntary association simply isn't working.

As the CSM slogan says, "it's Common Sense Mate."


Common currency? Or no common currency?

One of the debates that has been sparked by the recent weakness of the New Zealand Dollar (along with every other currency that isn't the US dollar!) is the notion of a common currency between New Zealand and Australia. Some commentators have presented it as a panacea for New Zealand's economic woes. This piece sets out to destroy that particular piece of myth-making.

First off, Reserve Bank Governor Don Brash summed up the range of contributing factors in an entirely convincing way in a speech he gave today to the American Chamber of Commerce in Auckland. Forgive the large quote but he sums it up rather well:

"I suspect that a whole range of factors explain the recent depreciation of the New Zealand dollar, including our large balance of payments deficit (and large accumulation of external liabilities as a result of running a balance of payments deficit for almost three decades); a perception that New Zealand (like Australia) is an "old economy" where things are made or grown, rather than a "new economy" of bright ideas and high productivity; the absence of any particular "reason" to buy New Zealand dollar assets now that our interest rates are closely comparable to those in major capital markets; and some nervousness on the part of financial markets (whether warranted or not) about the policy direction of the Government.

"In part at least, the "fall of the New Zealand dollar" is really a story about the rise of the US dollar. The US economy has been growing strongly, and the US equity market has risen very strongly over the past decade. This has attracted into the US savings from all over the world. Not surprisingly, the US dollar has risen as a result, not just against the New Zealand dollar but against a great many other currencies also. Between the beginning of 1999 and the end of September this year, for example, the Australian dollar and British pound depreciated by about 12 per cent against the US dollar, the Swedish and Norwegian currencies by about 16 per cent, the Swiss franc by about 21 per cent, the New Zealand dollar by about 23 per cent, and the euro by almost 25 per cent. Clearly, the fall in our currency is not just the result of the New Zealand dollar being the currency of a small economy: the currencies of much larger economies have also fallen significantly against the US dollar in recent times.

"And over and above all these fundamental factors, there is the possibility - indeed the probability - that some of the depreciation simply reflects the dynamics of the foreign exchange markets: various forms of "reef-fish" behaviour, to use former Prime Minister David Lange's expression, have almost certainly been at play.

"In short, the facts make it clear that there is no single, simple, explanation for the fall in the value of the New Zealand dollar over the last two or three years. It follows that exaggerated claims that the fall can be pinned on just one thing - whatever that one thing might be - are almost certainly wrong, and are unhelpful in improving our understanding of the implications. At this time, we need cool heads and rational thinking, not extravagant claims or counter-claims."

Brash clearly shows that no one single factor has driven the fall in the exchange rate.

Turning to arguments for a single currency, it is probably quite true to say that our exchange rate would be more stable were we to either adopt the Aussie dollar or create some sort of Anzac currency. It would certainly be more stable with respect to our main trading partner! Yet, there are major downsides which would have to be set against this advantage:

* if we link in with a common currency, we face the fact that we are by default adopting Australia's monetary policy. This could lead to problems. Take as a case study the Auckland housing price boom in the mid-1990's - back then, everyone complained that interest rates were being raised too high for the real economy, just to contain Auckland house prices (which was true). If you extend the scale, what would happen if the Aussie economy was booming and NZ's wasn't, yet we had high interest rates to contain inflation there? And the reverse?

* NZ and Australia have different exchange rate cycles because our economies produce different things. The Australian economy exports more manufactures and minerals than we do, with our economy still (unfortunately) being more dependent on pastoral commodities (i.e. exports of processed grass). The natural fluctuations in the exchange rates of the respective countries in response to trends in global commodity, mineral and manufactured goods prices would be hampered if both countries had the same currency.

* Finally there is a political question. Sovereignty over the money supply is one core plank of national economic policy. Any government which proposed to give such a policy lever up would be reduced solely to fiscal policy (varying tax and spending plans) as a means to affect the economy. Would we really want to be stuck in a situation where we had to increase taxes to head off inflation, instead of raising interest rates?

No doubt the debate over a common currency will wend on. My view is that there are more significant policy challenges facing the Government. Our dollar, up or down, is probably the least of our concerns. More important is seeing through Labour's plans to build the new economy we need to secure our future place in the developed world.


Website of the Week: http://www.freeburmacoalition.org

Free Burma Coalition

This site is a glimpse into the dirty little secrets that one of the nastiest regimes on the Asian Continent. You can sign a petition calling for the removal of Burma's voting rights in the General Assembly, find out about the resistance movement, and all sorts of details about the record of one of the worst regimes around. Have a look and lend them your support.


All submissions should be to the editor, Jordan Carter, at carters@ihug.co.nz, or the assistant editor, Michael Wood, at michael@semrits.co.nz.

While this newsletter is published in the name of Young Labour, the contents is entirely the responsibility of the editor and the views expressed here don't constitute any official position of Young Labour. All contents copyright (c) 2000. Subscribe at younglabour-subscribe@listbot.com

Te Wairua Hou - The New Spirit - http://www.younglabour.org.nz The Future Is With Labour - http://www.labour.org.nz

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