Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Insights Issue 23: US Election | NZ Internet | MMP

Insights
9 November 2012, Issue 23

In this issue:
America's real choice | Oliver Hartwich
Will we ever have a second internet cable? | Nick Phillips
The MMP review | Luke Malpass
All things considered ...
On the record

America's real choice
Dr Oliver Hartwich | Executive Director | oliver.hartwich@nzinitiative.org.nz
No one should ever compile a cost-benefit analysis of the United States elections. After a campaign that lasted about 18 months (and felt even longer), and having spent an estimated US$6 billion promoting both candidates, nothing has changed.

Barack Obama is still President, the Republicans still hold the House, and the political landscape is as polarised as before.

More importantly, the many problems of the United States haven’t moved an inch closer to a solution. That’s unsurprising since both candidates had focused their campaigns on rubbishing their opponents instead of developing credible policies of their own. America’s crisis is so severe that the outcome of the election barely matters as both sides of politics deny realities that do not fit their worldview.

The political left is unwilling to consider cuts in entitlements and discretionary spending despite a massive structural budget deficit. The political right is unwilling to discuss tax increases (and often even outrageous exemptions) to plug the fiscal gap despite the United States recording an even lower tax-to-GDP ratio (18.3%) than the notorious tax evaders of Greece (20.2%).

According to all plausible forecasts, the United States government will spend more than it receives in taxes for the indefinite future. However, indefinite overspending is not a realistic long-term option. As the former United States Presidential Adviser, Herbert Stein famously said, “If something cannot go on forever, it will stop.”

The choice for the nation did not end with this week’s elections. On the contrary, it is only after the elections that the real choice becomes clear.

Robert L. Bixby, Executive Director of bipartisan think tank The Concord Coalition, put it well:

“If the country is on an unsustainable fiscal path, which it is, and if continued partisan bickering will not solve this problem, which it won’t, and if divided government has been re-elected, which it has, then the only choices are calamity or compromise.”

To solve the United States’ economic challenges, President Obama and the Republican-led House must do what neither side wants: reform the tax system by broadening the tax base and reform all entitlement programmes to control spending.

What the United States can least afford is four more years of election campaign-style politics. Both camps must work together to avert fiscal disaster. But are Democrats and Republicans willing to cooperate for positive change?

The citizens have gone to the polls. Now the leaders must make their choice.
________________________________________

Will we ever have a second internet cable?
Nick Phillips | nick.phillips@nzinitiative.org.nz
New Zealand’s second internet cable is once again making headlines, this time courtesy of Internet entrepreneur Kim Dotcom.

German born Dotcom has hatched a plan to resurrect Pacific Fibre and build a second fibre cable to the United States.

Dotcom’s project funding plan is two-pronged: first, he will attempt to sue the United States government and some Hollywood studios over the alleged unlawful and political destruction of Megaupload. Second, he will start a new online storage company called Mega.

The New Zealand government is prepared to underwrite an undisclosed amount for the Pacific Fibre project, and Dotcom’s investment would provide Pacific Fibre with the remaining required capital.

In an interview with Fairfax Media, Prime Minister John Key said, “If Dotcom’s investment plan is genuine, then Dotcom would be putting his money where other investors wouldn't.”

Perhaps more kiwis need to be like Dotcom, because he realises that the benefits of the government’s ultrafast broadband network cannot be truly captured with the current external connection limitations.

As Rod Drury, Director of Pacific Fibre, said, “We still cannot see how the government’s investment in UFB makes sense until the price of international bandwidth is greatly reduced.”

A second cable to compete against the Southern Cross cable, costing approximately $400 million, would significantly drive down the price of broadband and double New Zealand's current bandwidth.

From a policy perspective, serious questions must hang over the efficacy of the UFB network without any extra external bandwidth. Creating extra bandwidth is a good idea, as a competing export orientated country it is our international bandwidth that needs to be enhanced, not New Zealand’s internal infrastructure.

So whether or not Dotcom’s proposal is legitimate, and whether or not he will ever be involved in Pacific Fibre (one suspects not), Dotcom makes a good point about the importance of a second cable.

And he is in good company – the Telecommunications Users Association of New Zealand agrees that the proposal would be a huge boost for New Zealand.
________________________________________

The MMP review

Luke Malpass | Research Fellow | luke.malpass@nzinitiative.org.nz
When the New Zealand Electoral Commission was asked to review how the Mixed Member Proportional (MMP) electoral system was operating, the outcome was pre-ordained: the report would extol the virtues of MMP, recommend a reduction in the 5% threshold, and scrap the one seat rule.

And so it has come to pass.

Introducing an absolute threshold without the one seat situation is good, but decreasing that threshold from 5% is not.

MMP was designed in post World War II Germany to prevent a Führer-like figure emerging. A parliament of coalitions would prevent concentration of power. New Zealand is not post World War II Germany, but a long-established democracy. But MMP in New Zealand has produced many small parties that have to be cobbled together and appeased or bought and paid for (like in Germany now).

This does not aid policymaking or accountability, and it makes coherent policy or reform agendas difficult to promise and almost impossible to execute.

Fortunately, New Zealand has had a relatively high threshold, keeping some of the more fringe parties out of parliament. For this reason alone, lowering the threshold to 4% is a mistake.

The report also wheeled out the article of faith that the MMP list ensures ‘diversity of representation’, which is ‘under threat’, so fixing a 60:40 ratio of local/list MPs should be considered.

The list does increase diversity but only at the margins, and the report’s arguments about MMP and diversity are dodgy. For example, the report argues that since 1996 only 24% of MPs in electorates have been women, compared to 43% from the list. Ipso facto, the list increases representation of women. This of course doesn’t consider that parties would behave differently if no list existed.

The same applies for Māori list representation: 21% of all list MPs have been identified as Māori, compared to 14% from electorates. This means electorate seat representation more closely reflects the Māori population than the list number! Of course higher Māori representation in Parliament than in the proportion of population is not a bad thing, but it does make the notion of the list ‘ensuring diversity’ a bit of a joke.

Perhaps the Electoral Commission has a ‘correct’ level of diversity in mind?

In short, the report is strongest in arguing what shouldn’t change rather than what should. The best recommendation is getting rid of the one seat threshold.


All things considered ...
Graph of the week, courtesy of BBC/GlobeScan/PIPA. Barack Obama is obviously better when you don’t live with him. The Americans supported him by a nose, but how much does the rest of the world support Obama?
• Kim Dotcom: Free internet for all! Or perhaps not.
• There are advantages to being in a far flung part of the British Empire (or the Commonwealth, as it tends to be known nowadays). For example, we could help the British invade Luxembourg!
• Speaking of Luxembourg, they recently had a royal wedding. It had the obligatory random European royals – the Greeks who are actually Danish, and the Germans who have incorporated their title into their surnames, and a prince of Saxony! It was like Will and Kate’s wedding, but the music was not as good.
• How is it that our Prime Minister has ended up in The Sun for calling a British star thick?
• How many times was ‘climate change’ or ‘global warming’ mentioned in the United States presidential debates? Not once. George Monbiot is right.
• The MMP review is finished, although what the government will do with the recommendations is anyone’s guess. The report is here.
• The best and the worst United States election campaign ads of 2012.
• Is she a politician or is she a sleb? Either way, the Tories have suspended MP for Mid Bedfordshire Nadine Dorries for starring in I’m a celebrity … get me out of here.
• America is in decline … literally. Der Spiegel reports on the crumbling American infrastructure.
• Shame has always been a powerful form of retributive justice. It might be out of fashion, but making someone wear an ‘idiot’ sign might just be a good idea.

On the record

Tipping towards Eurozone fragmentation, Oliver Hartwich, Business Spectator, 8 November 2012

Oliver Hartwich interviews Swedish economist Christian Sandström.
24 October 2012

Play video


Initiative@home with Adam Creighton.
24 September 2012


Play video


Government vs. Markets with Vito Tanzi.
21 August 2012

Play video

ENDS

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Parliament Today: State Opening Of Parliament

The House sits at 10.30am today before MPs are summoned to hear the Speech from the Throne in the Legislative Council Chamber.

The speech delivered by the Governor-General on the Government’s behalf outlines its priorities for this Parliament.

After this MPs will return to the House for the presentation of petitions and papers and the introduction of any bills.

The Government has five notices of motion on the Order Paper which can be debated. These relate to relating to the appointment of the Deputy Speaker, Assistant Speakers, the reinstatement of business in a carryover motion and one on “Entities to be deemed public organisations”. More>>

 

Tertiary Education: Students Doing It Tough As Fees Rise Again

The Government is making it increasingly difficult for Kiwis to gain tertiary education as fees continue to rise and access to student support becomes even more restricted, Labour’s Tertiary Education spokesperson Chris Hipkins says. More>>

ALSO:

Housing, Iraq: PM Press Conference – 20 October 2014

Prime Minister John Key met with press today to discuss:
• Housing prices and redevelopment in Auckland
• Discussions with Tony Abbott on the governmental response to ISIS, and New Zealand’s election to the UN Security Council More>>

ALSO:

Labour: Review Team Named, Leadership Campaign Starts

Labour’s New Zealand Council has appointed Bryan Gould as Convenor of its post-General Election Review. He will be joined on the Review Team by Hon Margaret Wilson, Stacey Morrison and Brian Corban.

ALSO:


Roy Morgan Poll: National Slips, Labour Hits Lows

The first New Zealand Roy Morgan Poll since the NZ Election shows National 43.5% (down 3.54% since the September 20 Election). This isn’t unusual, National support has dropped after each of John Key’s Election victories... However, support for the main opposition Labour Party has crashed to 22.5% (down 2.63% and the lowest support for Labour since the 1914 NZ Election as United Labour). More>>

ALSO:

In On First Round: New Zealand Wins Security Council Seat

Prime Minister John Key has welcomed New Zealand securing a place on the United Nations Security Council for the 2015-16 term. More>>

ALSO:

TPP Leak: Intellectual Property Text Confirms Risk - Jane Kelsey

The US is continuing its assault on generic medicines through numerous proposed changes to patent laws. ‘These are bound to impact on Pharmac if they are accepted’, according to Professor Kelsey... Copyright is another area of ongoing sensitivity... More>>

ALSO:

RMA: Smith Plans Reform To Ease Urban Development

Newly appointed Environment Minister Nick Smith has announced Resource Management Act reform to foster urban development, where high land prices and expensive resource consents are blocking efforts to provide affordable housing. More>>>

ALSO:

Gordon Campbell: On New Zealand getting involved (again) in other people's wars

Apparently, the Key government is still pondering how New Zealand will contribute to the fight against Islamic State. Long may it ponder, given the lack of consensus among our allies as to how to fight IS, where to fight it (Syria, Iraq, or both?) and with whose ground troops, pray tell? More>>

ALSO:

Gordon Campbell: On child poverty, and David Shearer’s latest outburst

The politicisation of (a) the public service and (b) the operations of the Official Information Act have been highlighted by the policy advice package on child poverty that RNZ’s resolute political editor Brent Edwards has finally prised out of the Ministry of Social Development. More>>

ALSO:

Gordon Campbell: On the government’s review of security laws

So the Key government is about to launch a four week review of the ability of our existing legislation to deal with “suspected and returning foreign terrorist fighters, and other violent extremists.”

According to its terms of reference, the review will consider whether the SIS, GCSB and Police are sufficiently able right now to (a) investigate and monitor suspected and returning foreign terrorist fighters… More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news