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Q+A: Panel Discussions 2 September 2012

Q+A: Panel Discussions 2 September 2012



A top panel with us today. Fran O’Sullivan, columnist with the New Zealand Herald; Dr Bryce Edwards, our political scientist from Otago University; and veteran political strategist, union boss and columnist, Matt McCarten. Good morning to you all. A bit of fireworks there, wasn’t there?

MATT McCARTEN - Unite Union
It’s a good thing you stopped it. I mean, another two minutes, you would have had a punch-up.

GREG Which way is the government going to go on this, Matt?

MATT It’s highly political. This is not actually about the economic argument. This is all coming apart. You know, who would have believed it? You know, the most popular prime minister, National’s significant election result, where it went out, told the people what it was going to do, they thought this was going to be plain sailing. There’s all sorts of complications. One thing’s not been mentioned. The tribunal, I don’t think it was planned. I think it was one of these things that happened. This challenge had been in for some time. I think it’s been mishandled, and I think it’s the inexperience of Key, and it’s self-created. But here’s the thing. Time is running out. Whatever decision they make tomorrow, they’re doomed if they do, and they’re doomed if they don’t.

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GREG You said this a couple of weeks ago, Bryce. You said this could be a game-changer, this could lose the election for the government. Really, really interesting point here: none of the people who are selling this, no one from the government, has come in to front for it. No one.

DR BRYCE EDWARDS - Political Scientist
Absolutely, and that shows how scared, on one hand, but careful they’re being. Because this is a defining issue for the government. It’s their defining issue of their second term, and, as Matt says, they are damned if they do, damned if they don’t. There’s risk either way. I mean, we can’t be sure what’s going to happen tomorrow, but I think there’s a 70, 80% chance that the government’s going to push through, say, ‘We’re going ahead. We’re going to sell them.’ They’ll stop talking about this idea of no one owns the water. John Key’s moved away from that. They’ll start talking about royalties, potential water fees to iwi, hapu.

GREG All of which ends up in court. It can’t end up anywhere else.

FRAN O’SULLIVAN - New Zealand Herald Columnist
It has to go to court.

GREG ‘Fiscal treachery’. That’s a good line. (FRAN LAUGHS)

FRAN It’s a great line. We’ve all been on the end of a treachery allegation from Winston, so we know what it’s like. It is an interesting line to put out there, but there is another fiscal treachery too, which would say that if the government caves to Maori on this and just makes heaps of shares available, everything one wants, without actually disputing the rights and finding out what those rights are hapu by hapu, river by river - the whole thing - that’s not good either. The Crown has a duty to, on behalf of all taxpayers and all New Zealanders, which includes Maori. The Crown also includes Maori. Everybody is part of that. And so there is, I think, a duty to go to court, clarify things. I think they can proceed with the Mighty River float. They’re going to have to put something in the prospectus which says, ‘Hello. There are issues which are going to be determined, and these may be determined by royalties.’

GREG What about the management side of it? Can that be done? The shares.

FRAN It’s not hard. That’s later.

GREG Would that smooth the waters now, because it’s not been talked about yet.

FRAN Well, how do you quantify it? How do you say how many shares until you actually have quantified what those rights actually are? So I think it does have to go through a process, and I see nothing wrong with actually privatising it with something in the prospectus which says, ‘Yes, there is an outstanding legal issue.’ And there are other issues. It won’t be the only one. There are other risks to these processes. So when, for instance, they come to do Meridian, there’s the Tiwai Point argument. There’s the fact that we are in the middle of a commodity slump, so a lot of our industry is not taking as much power. So, you know, it’s at the bottom end of the cycle again.

GREG The Maori Party - I want to talk to you about this. Hone Harawira was pretty strong on what they have to do and what he thinks they might do. Which way are they going to go? Because that is pivotal to all of this.

MATT Well, that’s the problem. I mean, they’ve got no choice. Now, they won’t walk, but they’re in an impossible position because they have to notice. That’s the problem they’ve got, and thus the government, and that’s why this is no longer an economic fight about the assets. This is about the stability and the credibility of the government. And they’ve put the Maori Party in an impossible position, you know, and there’s going to be a price for it at the next election and onwards. It’s extraordinary. A delay now for the government, though, is fatal. If they delay it, they’re in all sorts of trouble because people then smell it’s all going to fall over. Here’s another thing - the strongest argument from Key is, ‘I have a mandate.’ The problem is the people who are doing the referenda are now 50,000 away from hitting their target. They reckon they’ll have it in three weeks. Now, here’s the problem. Once it’s in, you know, how does Key have a mandate when there’s a referenda underway? And if the referenda is allowed to proceed before it’s paid, it will pass, and it’s all over. And this is the cornerstone of this government’s policy.

FRAN But there’s also a bigger issue of economic interest, because this issue over water- I mean, nobody’s given attention to the geothermal side of the equation, which is also part of that action, that scheme. So how they settle this in a political way is going to be integral to what happens with geothermal, everything.

GREG Set a road map. Is there a third option? Is there a middle ground on this that possibly could be taken to save some face, get it through, not alienate your Maori Party, for the government?

BRYCE I think the Maori Party’s going to be alienated whatever way they go, but, yes, John Key’s claim to fame is finding middle roads, and so he will be doing that tomorrow. He will be saying, ‘Yes, we’re going ahead, but there’s all these other things we’re negotiating in good faith.’

MATT They’ve got to buy the iwis off. They’ve got to give them a cut.

BRYCE Yes, and they will. We have iwis speaking out already saying, ‘We prefer to negotiate with the Crown.’

MATT That’s the only way out.

BRYCE So I think we’ll see progress moving ahead on this.

GREG I forget who actually said this, whether it was Winston or Hone who said Key was expecting court action and was reasonably relaxed about it. Is that true?

BRYCE Yes, I think so.

FRAN Yes, they are relaxed about it.

GREG That’s pretty naïve, isn’t it?

FRAN No, not necessarily, because I think if you have a construct that says- I mean, at the end of the day, the Crown’s got to be able to govern, the Crown’s got to be able to implement policy. And if the Crown can put up something which says that, yes, we will go ahead with this, but meanwhile we will, in good faith, have within the sale that we will attend via royalties or via some other way to deal with these issues which will proceed over years. And I don’t see anything wrong with that, and I would be surprised if, when it gets to the Supreme Court-

MATT That’s the logical thing to do. The problem is the delay.

FRAN Yeah, but maybe they can ask for it to go straight to the Supreme Court. I don’t know. Maybe they can. Maybe they can make it an issue

GREG Is there any way that the Maori Party can say, ‘Yes, we’re going to sell. We’re going to do this,’ and hop on that National boat and not look like they’ve completely bent every ideal they were founded on in the first place? Is there any way they can do that?

MATT Um, it will be difficult, but I think they have an argument and say, ‘We don’t have the numbers. So we’re now getting the best deal we can.’ And that’s why I think the government’s got to give some crumbs to the iwi in terms of royalties or buy some of them off. I think that’s the way for it.

BRYCE And so it’s the crumbs.

MATT And that’s probably enough for them to get through, because there’s still a willingness by the iwi heads that it’s better to have the Maori Party in the tent than out of the tent.

FRAN They have been seen pretty much the defacto political arm of the iwi leadership group, not necessarily the Maori Council, and seen to be in there to actually advocate for Maori commercial rights. And at some stage of the game, Parliament has to be a bit bigger than just that too.

GREG All right. We will leave that there.

In response to KATE WILKINSON interview

Let’s talk to our panel. Fran O’Sullivan, first of all. Just on consumer feedback, just on submissions - what do you make of that?

FRAN O’SULLIVAN - New Zealand Herald Columnist
Well, I think it’s a fair deal, to be perfectly honest, and I actually just see this to being no different to, for instance, buying milk fortified with calcium or not, buying salt with iodine or not, or having water fluoridated or not. It’s one of these big issues that actually does divide consumers about when you add something into it, and I think as long as there’s choice, it’s advertised and that there is that option available, I don’t think it’s a big deal.

GREG Bryce?

DR BRYCE EDWARDS - Political Scientist
I think the science is pretty strong on this - that there’s big benefits in having fortification in the bread, but science aside, I think this is the right decision by the government electorally, politically. Because the public is quite suspicious of this idea of mass medication, and that’s being pushed by the various industry groups. And they’ve won the day, I think, which is a bit unfortunate in some respects, because I don’t think we’ve had a thorough, informed debate on this. But nonetheless the government looks weak on this because it’s quite a pragmatic decision. It looks a bit weak. They haven’t really come out and said, ‘We think this is the right decision.’ Instead they’ve said, ‘Oh, choice.’ It looks like they’re kicking for touch, really. They could have just left this alone three years ago, because the government before them made this decision, but they’ve got themselves into all sorts of knots on this.

GREG You’re talking about mass medication, and yet we accept fluoride in over half our water, yet we’re not going this far. What do you make of what the minister had to say?

MATT McCARTEN - Unite Union
First, I think that whole interview was bizarre. I mean-

GREG I did my best, Matt.

MATT Well, one of the players was bizarre. Let’s put it that way. Um, she came on here three years ago, and it didn’t seem like she really had her finger on it, and that shows that she hasn’t learnt in three years. She’s been all over the place on it, and in the end, it’s an abdication. You make decisions on science. Is it or isn’t it? And then you make a decision on that. What she’s really saying is it’s the submissions. Well, you know, the government has another policy on things like cigarettes. You know, they want to regulate. There’s certain things about saving other people’s lives. The government’s job is to actually make thoughtful decisions based on science and on risk.

FRAN If you were going to do that, wouldn’t you give all-?

MATT She just goes, ‘Oh, well, I just made submissions. I just made it on that.’

FRAN Why wouldn’t you, when a woman is pregnant, just make a folic acid supplement available?

GREG It’s too late. They have to have taken this stuff before they get pregnant. I think that’s the argument for the mandatory side of it. Having said that, Fran, just listening submissions. Don’t always listen to submissions, yet you’ve got a fairly strong scientific arguments on both sides of the coin, and she’s just gone, ‘Ah, consumer choice.’

FRAN Well, it’s a very interesting thing. If you look at young women today, quite often they’re actually advised not to eat bread, because bread fattening, it’s carbohydrates and it’s all this stuff.

MATT Not allowed to eating anything. Drink nothing. Do nothing. Stay inside. Life’s dangerous.

FRAN I still don’t understand - why through bread? Why not part of whatever? I don’t know.

GREG Is there a fear this is the thin edge of the wedge? That next we’re going to start talking about taxing fat, taxing sugar? Is that the push the industry would have been making behind the scenes, you feel?

BRYCE The industry has won the day on this, and the industry will be trying to stop other government regulation intervention. And there is a public fear, I think, of the government saying too much, ‘You can’t do this. You can’t eat this. We’re going to make producers put everything into the food.’ I think that is quite a widespread-

MATT But things have got to go into the food because the nutrition is being pulled out of it because it’s mass produced.

BRYCE That’s why we need a debate about it, absolutely.

GREG All right, guys. We will leave it there.

In response to PACIFIC ISLAND FORUM item

Let’s talk to our panel. First of all, Fran. ‘We want, we want, we want. In it for the long haul. I think the Pacific is big enough for all of us.’ What do we make of what Hillary Clinton’s saying?

FRAN O’SULLIVAN - New Zealand Herald Columnist
Well, it’s very interesting, because if you hark back to when the forum was held here in I think around 2003, post-September 11, in fact, the Assistant Secretary of State for the East Asia Pacific Area from the US, he was sort of on the outskirts of the Donor Forum. Whereas the Chinese Vice Foreign Minister was very much at the table then. The US has to realise that China has filled the vacuum that they had basically left in the last 10 years. So, yes, it is big enough for both, but China, actually, has a bit of an edge at the moment.

GREG It seems also that one of the most bizarre parts that Hillary Clinton says is going to help is with bomb dismantling, because that’s been such a huge issue in the Pacific, and fish patrol, because they, again, have shown a huge interest in that lately. It’s all a bit late, isn’t it, Bryce?

DR BRYCE EDWARDS - Political Scientist
Exactly, and it shows that the US is really entering in and following China. So we do have a looming power struggle here. Lots of diplomacy going on from both China and the USA and New Zealand saying these aren’t big issues, but they are. And I think it’s good that we’re having a bit of a power struggle here, because these Pacific Islands really do need resources and money quickly. And it actually allows them a bit more independence from New Zealand and Australia, because they have been reliant on New Zealand aid and our good will. Whereas they need a bit more independence, they need these resources. So I think it’s good for them. And America hasn’t actually got a flash history in the Pacific, so I think they should be welcoming the Chinese.

GREG Is it a good thing, though, Matt? All of a sudden the big cool kids want to be our mates. Should we be pretty suspicious of this?

MATT McCARTEN - Unite Union
Yes, of course. China has, in Africa and South America, been quite deliberate in their approach. Both have been at. The Americans after the First World War put that influence, but it came with ideology, and they’re still doing it. When they get involved, it’s about regime change, it’s about the new democracy. It’s political. What China’s doing is building police stations, building roads, building new utilities, and they don’t interfere in the local thing, and that’s why they’re going to be more successful.

GREG Having said that, from the Chinese delegation: ‘We are here in this region not to seek any particular influence, still less dominance.’ Believe that, and I’ll sell you a bridge.

MATT But also it is driven by markets and by their need for food for their growing population. Because China is driven by stability, internal stability. They need the food. That’s why we have the Crafar farm thing. It’s all about economics.

BRYCE It’s more economics.

FRAN Essentially, and what we forget is to China, we are also seen as two Pacific islands. And we forget that. You go up to China Foreign Affairs in Beijing, we’re there. We’re part of Oceania. We’re not part of Asia. We are two islands. And the interesting thing is that I think, you know, Hillary Clinton and America, they changed their view to us when they saw this steady parade of Chinese politicians being welcomed here. We have been extraordinarily open to China in the last 10 years.

GREG Can we have a bob each way? Can we get in with the Americans and stay in with the Chinese?

BRYCE That’s what the government’s trying to do. They try to ride this Pacific pivot thing. And I think, for the moment, they can, but ultimately there’s going to have to be some sort of choice. It’s going to be hard.

FRAN No, no.

MATT But also it’s not going to be one superpower. The problem is for the States, China also holds their debt. That’s why they’re playing nice. This is about economics.

GREG They have no option.

FRAN One point I want to get across with the Pacific Islands is what has happened there is there has been, at times, huge local unrest towards Chinese who have come in and who have brought with them corruption, meth labs in Fiji, all of that. So there is an underbelly and triad culture and all of that which I think is not being exposed, but needs to be kept in mind.


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