SPEECH ALERT

18 November 2009

Getting things right for farmers and New Zealand

President’s opening speech to the 2009 Federated Farmers National Council.  Speech calls on the Government to repeal the Climate Change Response (Emissions Trading) Amendment Act.

Good morning fellow farmers and members of Federated Farmers National Council.

I think we all need to take a moment to thank Westpac New Zealand for the use of this magnificent stadium.  To Westpac, I say thank you.

And what scenes has this stadium seen.  Last week’s tour de force by the All-Whites shows that we are world beaters if we put our heart and soul into it.

Farmers know anything is possible.  Farmers prove it every minute of the day.

With our colleagues in fishing and in tourism, the land and the sea generate 70 percent of our country’s revenue and deliver 100 percent of the view.

But they say a week is a long time in politics.

New Zealand’s farmers, to some members of our society, seem to resemble latter-day versions of the Shakespearean character, Shylock. 

The Merchant of Venice is a controversial play.  Shylock, the money lender is embittered and angry - a victim of anti-Semitic taunts, sleights and betrayal. 

Shylock is shaped is a product of his surroundings and his treatment by others, so I ask:

“I am a farmer. Hath not a farmer eyes?

Hath not a farmer hands, organs, dimensions, senses, affections, passions? Fed with the same food, hurt with the same weapons, subject to the same diseases, healed by the same means, warmed and cooled by the same winter and summer as townies?

If you prick us, do we not bleed? If you tickle us, do we not laugh? If you poison us, do we not die?”

The poison comes in many forms and we face a battle for the hearts and minds of urban New Zealand on water.  We are up against lobby groups and councils who frankly lie.

To the media assembled here, I am glad to show you a classic example of this on page 53 of the latest Forest and Bird magazine.  What looks like a creek, isn’t. What purports to be ‘dirty dairying’, isn’t.

The poison is also the New Zealand dollar spiked ever higher by Government spending which, in real terms, is some $30 billion higher today than it was in 1999.

It is testament to the grit of you, the elected office holders and to our staff that we punch massively above our weight. Without your work, farming in New Zealand would be extremely difficult.

Yet the Select Committee Report on amending the toxic Emissions Trading Scheme is, increasingly, a Shakespearean tragedy. 

All Kiwi farmers want is to be treated the same on emissions as our cousins in Australia.  The fact is we’re not.

The rehearsed counter argument is that food is to us what coal is to Australia. If that’s the case then, why are coal exports and the oil we export to Australia, totally exempt from emissions liabilities?

You can’t eat coal or oil but it highlights how woolly the thinking is.

Two weeks ago I predicted an ‘escape hatch’ for Australia’s farmers would be opened.  Sure enough it has been.

While the Rudd Government controls the lower house, the Coalition with the Independent Senator, Nick Xenophon, has the numbers in the Senate.
Australia’s ETS forces the Government and Opposition to work with one another.

That spirit is non-existent in New Zealand.

Labour commits itself to the wilderness by backing ‘its’ ETS with messianic zeal.  The Government, for unfathomable reasons, is attempting to squeeze new wine into old bottles by re-engineering Labour’s ETS.

The mess, no the shambles we are in, is totally unique.  No other country on earth is as fixated with emissions trading as we are.  It’s obsessional.

The result has National grasping desperately for solutions.  Its offer of privilege is a solution to the political impasse.  But it’s a solution for what?

I will speak frankly. 

I’ve had a gut’s full, an absolute gut’s full, of having our efforts thrown back in our face.

We are ‘blamed’ for generating half of New Zealand’s emissions.  Dr. Jan Wright, the Parliamentary Commissioner for the Environment and someone I respect, has got it crushingly wrong in saying farm emissions would be ‘subsidised’ under the ETS.

If there’s a notion of ‘subsidy’, then who exactly is subsidising whom? 

Real New Zealand are the farmers, manufacturers and tourism operators who earn 100 percent of the currency that pays for teachers, doctors, medicines and services.  100 percent of New Zealanders depend on what we do. 

That by the way is 100 percent pure, fact.

New Zealand’s taxpayers are yet to wake up to the fact the ETS is a three lettered word for tax.  They are yet to wake up to the global and local jobs scheme it really is.

You have to seriously question any supposed ‘market’ which needs legislation to force participation. That’s what the ETS is. It’s an artificially created market totally dependent on international treaties and domestic legislation to operate.

The international treaties ascribe vast sums of value to the intangible products which comprise ‘climate changing gases’. 
                         

Why is it, after the sub-prime alchemy, that so many on the right and the left are buying into emissions trading?  It resembles some latter day Tulip crisis – the mother of all financial bubbles.

I ask how, as one commentator put it, ‘could a mere tulip bulb be worth US$76,000?’ 

Could carbon be worth the paper it’s written on?  The answer is yes, if people are either willing or forced to pay for it.

It may sound preposterous, but this did happen in Holland in the 1630s. 

Tulip bulbs, introduced from the near-east, were initially bought by enthusiasts.  Demand soon outstripped supply and rising prices attracted speculators. Soon ‘local market exchanges’ were established to trade tulip bulbs. Incredible.

The prospect of a quick-return infected first the Dutch middle then lower classes.  This coincided with contract trading so that ‘virtual bulbs’ could be traded as paper.  Everyone got into it.

 nd while prices soared, people made money but by 1637, the market ran out of steam and imploded.

The more I hear about carbon markets, the more I see tulips. Except this is not based on a perception of scarcity but a belief in over-supply.

It’s incredibly ironic that those who love and loathe market economics totally embrace carbon trading. 

I’ve met the epitome of the ‘sandal wearing lentil eating hippy’ at debates hosted by Victoria and Otago universities. 

They look down at you as a despised capitalist, but then wax lyrical about how great carbon trading is.
 I just see tulips.

What we do as farmers is real.  We trade carbon every day of the year in the food we produce. 

In 1985, New Zealand did adopt an ETS except it was an efficiency trading scheme whereby farmers traded poor practice for good by kicking the subsidy habit. 

The Emissions Trading Scheme on the statute books right now is an efficiency transfer scheme and that’s why we are angry.

New Zealand produces massively more food over the emissions generated.  Yes, we are told there was a 12 percent growth in agriculture emissions between 1990 and 2007.  But that was half that of the general economy’s 24 percent.

I repeat, agriculture emissions growth was half that of the general economy.

Yes we did grow emissions but we grew productivity and value to the economy too.  Meanwhile emissions and population growth are intertwined as the economy’s growth shows. 

Our growth was substantially less than the 74 percent for transport and the 120 percent for electricity.
percent of our food is exported so the prospect of us being forced to produce less, so inefficient producers can produce more, is frankly bonkers. As farmers we are being told that we got too good, too soon!

So what’s the alternative?
First, let’s scrap the ETS and start with a blank piece of paper. 

Trying to amend it is a growing disaster.  The MMP horse trading is absolute nonsense and the National Government is being bent out of shape over it.

The original ambition was to change people’s behaviour, to use resources efficiently. 

That has now turned into a complex accounting exercise, actually an accounting nightmare, whereby even the accountants can’t agree on the figures.

Do we have a $500 million deficit under Labour, or is it the break-even position Minister Smith announced earlier in the year, or is it this $105 billion blow-out by 2050? 

Will the real figure please stand up!

If we do secure the ETS’ scrapping then we, as a Federation, must be prepared to revisit past positions. 

Federated Farmers must revisit things we previously opposed.

But my message to the Government is that we cannot do that with the current scheme or the bizarre lengths being taken to get amendments over the line.

So let’s repeal it and start anew.

Then again, the ETS is all about doom and you can make a quick-buck from doom. 

Al Gore’s An Inconvenient Truth cost him around $1.3 million to make but made the millionaire a cool $66 million at the box office.  It also helped him win an Oscar and a Nobel Peace Prize, worth some $2 million more

Did I say millionaire?

Al Gore not only created the popular uplift in a fear of tomorrow, but then launched a fund that would commercialise climate reducing technologies.  Neat.

Mr Gore could well become the first climate variation billionaire.
On one hand, an astrophysicist is giving us a 50/50 chance of surviving the next century.  On the other, vulcanologists are saying Yellowstone, the big daddy of super-volcanoes, is overdue to pop and if it did, some 80 percent of life would be wiped out.

There’s even a movie coming out called 2012.   It’s about the Mayan prediction the world will end on 21 December 2012. 

History is littered with messianic predictions of doom.  In fact, there have been no less than 220 dates predicting the world’s end.

The Green movement tells us unless we do something dramatic about climate variation, then, in ten years time, there will be ‘catastrophic runaway climate change’. Make that date number 221.

I am truly concerned about our young.  Impressionable and easily influenced, they hear these predictions of doom and ask why bother?

Why save for the future, why study hard, why do the right thing?

We have problems with Gen-Y but that may reflect the apocalyptic future being extolled by green lobbyists.

Psychologically, these dire predictions are sucking aspiration and realism from our young.

There is so much negativity in this world so let us look to solutions.

Farmers are reducing emissions per unit of output in spite of policy not because of it.  

We are proud to feed the world and cannot understand why our Government and sections of society wish us not to. 

We farm globally, locally.

We embrace technology and solutions.  We get up, don those gumboots and get cracking in rain, hail, sleet and snow. Our stock and crops work 24/7 - they never go on strike and neither do their masters.

The genesis of our economy is food production from the land and sea. I have four words of realism - no emissions, no economy!

We believe tomorrow will be better than yesterday.  But since I started with Shakespeare, I will end with Shakespeare. 

Farmers, "be not afraid of greatness. Some are born great, some achieve greatness, and some have greatness thrust upon 'em."

ends