Winston Peters and the fish canning opportunity

In an interview on TV3’s The Nation,Winston Peters claimed that the fishing industry should be “New Zealandised”. He wants the government to intervene in the industry to make sure that “our fish is caught by New Zealand boats and New Zealand fishermen and is added value that is packaged here and sold here and sold offshore. I don't see how we can get any advantage from foreign crews sending the raw product to China, and have it tinned back to our supermarkets”.

The advantage you get from not doing something, such as putting fish in tins, is that it leaves you free to do other things. All the New Zealanders not working in fish canneries and all the capital not being invested in canneries can be deployed in other ventures.

The question is whether those alternative ventures are more rewarding than fish canning. Since investors prefer the alternatives to fish canning, it’s a good bet that they are indeed more rewarding. How can Mr Peters possibly know that investors are wrong about this?

Of course, investors sometimes miss opportunities. Perhaps fish canning really is a better investment than the alternatives. But if Mr Peters is so sure of this, why does he not start a fish cannery himself? Why instead use the coercive powers of the government to have New Zealand capital and labour directed to this business?

Those who favour centrally planned economies need to explain why investment decisions are better made by politicians in search of votes than by investors risking their own money in search of profits.
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