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Coronavirus Recovery & Politics

We don’t value people correctly or in fact adequately.

I was recently listening to an interview on television and it made me think that we are rapidly becoming a society that values wealth, intelligence and goods over the common personal values.

I believe that we need to go back to basic principles and value them properly first.

It seems that with the advent of the coronavirus worldwide it has meant that we have all had to prioritise personal welfare over and above income and profit margins as evidenced by the lockdown that has been deemed as the best way of controlling the spread of the disease and limit the resulting number of fatalities from it.

Now that we are looking as though we may be getting to the stage of being able to relax the emergency level 4 lockdown restrictions the government has stated that they can use infrastructure development as a method of boosting the economy by creating jobs and creating demand for goods and services from those developments.

I believe that we should prioritise expenditure on infrastructure with the starting point being for spending around fixing infrastructure in our cities, towns and country (an example of this need can be seen in Wellington where the waste water pipes are in such a state the they have failed and poured untreated water into the harbour).

If councils had done the basics properly like providing and maintaining roads, water, waste water, rubbish collection, parks and stuck to their core functions then things would have been in better condition.

One of the main causes of pressures on local government that has restricted their ability to focus on these basic functions has been the continued accumulation of tasks and responsibilities passed from central government, without adequate funding means. They are now required to undertake a huge range of social welfare functions that should rightly be the responsibility of central government.

Part of the problem is that for years those elected to Councils have had either a very limited idea of their responsibility (to provide basic essential services) to the whole community or taken a very narrow vested interest view. Council officers are often little better, either seeing theirs as ‘jobs for life’ or confusing their role of providing balanced professional advice with that of the elected representatives, and effectively becoming internal advocates for their own position without providing balanced professional advice.

If communities are to reach their potential then councils should be incentivised to improve their performances. The funding and financing framework for local government must incentivise good performance, and enable local authorities to deliver quality amenities and services that reflect the preferences and aspirations of their communities.

Another huge part of the problem is that there are many people who are focussed on protecting the environment to a standard that is unobtainable. Often the problem is that they only see what they believe is the desired result and the most important in their eyes. They often seem to have lost sight of the bigger picture and of how to achieve the desired result.

Most times by doing the basics right you can make the biggest changes to the environment and this comes about through having well designed and maintained infrastructure that is capable of providing the designed outcomes for the community whilst still maintaining the integrity of our natural environment.

Yes we need to have environmental rules to protect our natural habitats and resources but we also need to allow for the fact that if we are to function as a modern society, we must allow for independent thinking that encourages innovation not discourages individual actions.

We can do better but without taking man and all of his developments out of NZ we have to accept a balanced compromise.

When we have a society that values wealth, intelligence and goods over the basic personal principles, we have a society that is heading for failure. To keep the community safe and provided for we need go back to basic first principles and value the whole not the half.

So to achieve a society that all can live in and feel like valued members of that society then with we need to go back to first principles and also keep it simple. We saw that when they simplified the tax rules we didn’t need all the lawyers, accountants to try to find a way around paying tax. The tax system had become so complicated that it paid to have lawyers and accountants to save tax. Now after it has been simplified the need to have lawyers & accountants to prepare tax returns has been removed.

We need to let people to take control of their lives, (e.g. under the Health & Safety Act we are being told how to do each job) but do the bureaucrats who wrote the legislation know everything, hell no? This applies for everything we do and we see examples of this in the lock down for Covid 19 these people are telling us what is essential and what is not.

The problem is that they make mistakes because these bureaucrats can only rely on their personal experience and often this is moulded by a life time removed from reality, being employed in the public service which was evident in the need for changes to enable the re-entry to go ahead at the Pike River Mine.

This is not to say that they are not realistic in their views it is just that they are, by their employment in public service, often unaware of the realities of life particularly in the lower socio-economic brackets of society.

I believe that if we simplified a lot of the legislation that we have to work under then a lot more would get done and you would build a resilient work force that would be able to make their social/work life balances work?

In the current economic climate post the lockdown we are going to have a serious number of people in financial difficulties with initially, much higher levels of unemployment and the need for financial assistance from government.

It’s time the MP’s and bureaucrats who run the government and Councillors/local bodies realise that they should be putting in a balanced budget or a reduction in the rate takes and look at just doing the minimum works that they need to do to allow society to function.

We currently have Auckland City Council going out to ask their levy payers whether they want a 2.5% or 3.5% rate rise when given the current economic climate ACC should bite the bullet and declare a zero increase for at least the next twelve months. Local bodies should stand up and say we will reduce the rates so people have monies left to feed their families instead of having charities distributing food parcels so that people do not starve.

A recently published Bloomberg article written by: John Micklethwait and Adrian Wooldridge stated the following:-

The most misleading cliche about the coronavirus is that it treats us all the same. It doesn’t, neither medically, economically, socially or psychologically. In particular, Covid-19 exacerbates preexisting conditions of inequality wherever it arrives. Before long, this will cause social turmoil, up to and including uprisings and revolutions.

Social unrest had already been increasing around the world before SARS-CoV-2 began its journey. According to one count, there have been about 100 large anti-government protests since 2017, from the gilets jaunes riots in a rich country like France to demonstrations against strongmen in poor countries such as Sudan and Bolivia. About 20 of these uprisings toppled leaders, while several were suppressed by brutal crackdowns and many others went back to simmering until the next outbreak.

The immediate effect of Covid-19 is to dampen most forms of unrest, as both democratic and authoritarian governments force their populations into lockdowns, which keep people from taking to the streets or gathering in groups. But behind the doors of quarantined households, in the lengthening lines of soup kitchens, in prisons and slums and refugee camps — wherever people were hungry, sick and worried even before the outbreak — tragedy and trauma are building up. One way or another, these pressures will erupt.

1651, a gentleman scholar who readily admitted that “fear and I were born twins” published one of the great books on government. Thomas Hobbes had survived the notoriously bloody English Civil War by fleeing to France — and his great philosophical concern was personal safety. Life in a state of nature was, he observed, “solitary, poor, nasty, brutish and short” because people were always fighting. So, he argued, citizens should contractually give up their freedoms to a ruler who could offer them protection. The state’s legitimacy depended on it fulfilling that contract and keeping its citizens safe, a revolutionary idea at a time when kings, like his former pupil Charles II, claimed their position came by divine right. For Hobbes, who also managed to survive the Great Plague in 1665-66 and died in his bed at 91, our contract with “Leviathan,” as he called his book, depended on its ability to keep us safe.

If Hobbes were alive today, he would feel vindicated. Around the world, fear is on the march — and, in order to be protected from this terrible virus, we are willingly surrendering basic rights, even the freedom to leave our own homes, to Leviathan. The Covid-19 pandemic has made government important again. Not just powerful again (look at those once-mighty companies begging for help), but also vital again: It matters enormously whether your country has a good health service, competent bureaucrats and sound finances. Good government is the difference between living and dying.

Since Hobbes’s time, the world has come full circle. When he wrote “Leviathan,” China rather than Europe was the center of administrative excellence. China was the world’s most powerful country with the world’s biggest city (Beijing had more than a million inhabitants), the world’s mightiest navy and the world’s most sophisticated civil service, peopled by scholar-mandarins who were selected from across a vast empire by rigorous examinations.

Europe was a bloodstained battlefield ruled by rival feudal families, where government jobs were either allotted by birth or bought and sold like furniture. Gradually Europe’s new nation states overtook the Middle Kingdom because they underwent a series of revolutions unleashed by national rivalries and political ideas — not least those advanced by Hobbes. By mastering the art of government (even copying China’s “mandarins”) the West dominated the world for 400 years.

The West’s governmental advantage is now questionable: Simply ask yourself whether you would feel safer today in New York and London or in Singapore and Seoul? Asia is catching up with the West, and in some smaller countries has overtaken it, in large part because Confucian Asia in particular has taken government seriously over the past few decades while the West has allowed it to ossify.

The public sector in the West is decades behind its private sector in terms of efficiency and dynamism. Lenin once said that “there are decades where nothing happens, and there are weeks where decades happen.” The coronavirus crisis is exactly such a history-accelerating event. If Western governments respond creatively to the crisis, they will have a chance of reversing decades of decline; if they dither and delay while Asia continues to improve; the prospect of a new Eastern-dominated world order will surely increase.

Will the Covid-19 crisis be the spur for governments to improve?

At first glance, the omens are not good. Everywhere you look, you see bureaucracy’s in a sorry state — overstretched and inefficient, driven by panic rather than careful planning.

But if we look more closely there are more positive signs. Countries that have rethought government, like Denmark, or valued good government traditions, like Germany, are doing better at dealing with the virus.

If you look back through history, Western government has been through at least three big revolutions, driven in each case by new ideas, new technology and new threats.

The first which occurred around the time of Hobbes was the creation of the competitive nation states.

The second revolution occurred in the late 18th and early 19th centuries. Thinkers such as Adam Smith and John Stuart Mill in Britain and Thomas Jefferson and James Madison in America argued that corrupt monarchical privilege should give way to liberal efficiency. New technologies such as the railway and later the telegram allowed the state to do more with less. British liberals ruthlessly got rid of sinecures, sacking incompetents, opening the civil service to merit. Victorians believed that it was perfectly possible to make government more useful and smaller at the same time — an idea the West has sadly lost.

The third revolution began in the late 19th and early 20th centuries — and laid the foundations for the welfare states that all of us in the West now inhabit. The watchword was security once again, but this time it was security against maladies, misfortunes and inequalities, rather than civil war and the plague. As late as the 1960s, many people in the West still believed that government could secure ever more benefits. But after the debacle of Vietnam and the disaster of the energy crisis, faith in government began to pall.

Policy makers began to turn to libertarian thinkers, like F.A. Hayek and Milton Friedman, who trusted the market rather than enlightened bureaucrats to fix things, and who had long argued that people were handing over too many freedoms for only marginal gains in well-being.

Nowadays, the state consumes about 40% of gross domestic product in the West, compared with 10% at the beginning of the 20th century.

The Western state is a grumpy, unloved compromise. The people who pay for it think it gets too much; the people who use its services think it gives them too little. The more things the state promises to do, the more it overburdens itself; the more it overburdens itself, the more we all complain.

When it regulates something, we complain; when it stands pat and allows something to go wrong, we complain louder and the gulf between it and the more dynamic private sector yawns ever wider.

Behind the ideological squabbling, the main problem with Western governments is simple: They are out of date. If you want a symbol of this, look no further than of all the changes that the private sector has been through over the past century: vertical integration followed by contracting out; steep hierarchies followed by delayering; skyscraper headquarters followed by suburban campuses followed by a return to the city.

Think of all the companies that have been created and destroyed in a never-ending whirlwind of creative destruction. Now think of governments that have continually expanded even when the private sector has contracted due to economic disasters.

While Western government has atrophied, Asia has embraced the future. Singapore has been a leader. A city-state that was once an impoverished swamp which can now claim to be the best-governed small state in the world.

Singapore has achieved this not by spending large sums of money — it spends less than 20% of GDP on government — but by thinking more creatively and acting more decisively. Singapore also works creatively with the private sector. The government manoeuvres local businesses up the “value chain” — betting first on manufacturing then on services and now on the knowledge economy, particularly information technology and pharmaceuticals.

The relative performance of Asia and the West in coping with coronavirus should be a warning to the West. Many of the most impressive government responses have been in East and Southeast Asia. While the West dawdled, Japan, Hong Kong, South Korea and Singapore all developed their own tests for Covid-19, ramped up production of the materials needed for the tests and made money available so that people could pay for tests and treatment.

South Korea even installed booths in the streets in Seoul where you can get walk-by tests from masked health-care workers sitting behind protective glass. The fact that, having done everything right, Singapore was eventually forced to introduce a lockdown, or “circuit-breaker” as it calls it, on April 7 is testimony to the virulence of the virus. Fewer than 10 people have died there.

No one would describe the virus response as being a success for Western soft power. A few European countries have performed creditably. Germany, where trust in government runs at the same high levels that we see in South Korea and Singapore, has been successful at mass-producing tests and using them to slow the death rate. By the end of March, the country had tested a million people: In Bavaria, 11,000 of the 13,000 tests it does every day are in private labs.

So what should we learn from this? One theory being spoken is that government needs to be expanded permanently to deal with global crises. The argument being that, just as wars have greatly expanded the role of the state in the past, so the war against Covid 19 will greatly expand it from now on. Government-supported health systems will expand to deal with future threats. Governments will be stuck running big chunks of the economy.

This argument is unconvincing. The current list of government-expanding measures look pragmatic and temporary: a combination of Keynesian demand-management to boost the economy, time-limited intervention to prevent vulnerable industries from collapsing and a basic income for workers who are temporarily laid off. Rather than clear the way for an era of ambitious government programs, the crisis could well usher in yet another era of austerity, especially as already indebted governments try to bring their debt under control.

In relation to the New Zealand government’s response to the crisis I believe that the recent statement on facebook from the Hamilton East MP Hon David Bennett

(“Many years ago our forebears had the foresight to use large Gov’t funding and an able workforce to build projects that deliver to the Waikato’s region in 50 years time... let’s hope upcoming announcements from Gov’t on funding aren’t for short term nice to haves but deliver a long term and substantial changes that provide for a stronger economic base for the region for generations to come”.)

could be a guiding principle for government in their decisions about which infrastructure projects they are going to support in kick starting our economy post the Covid 19 lockdown, with the only change to that statement being a focus nationally rather than just on the Waikato region.

The most interesting lesson we should take from crisis concerns two things that are seldom discussed together: the efficiency of the government apparatus and the purpose of government in general.

One thing that links governments that have reacted well to the crisis is a taste for learning from one another, and from the past.

The single greatest failure in the West’s public sector has been its failure to copy success.

In the private sector “best practice” spreads rapidly because companies that learn from the best survive and those that refuse go under.

But in the public sector, thanks to a combination of jobs-for-life and risk aversion, institutions get stuck in their ways.

The pandemic may well finally spark a burst of modernization. Governments will be squeezed by two contradictory pressures.

The first is the pressure to improve many of their welfare provisions, most particularly their health-care and social care systems, so they can cope with any subsequent outbreaks. The other is to balance their books as public debt surges to unsustainable levels.

Indeed, this crisis should prompt all the democracies of the West to ask some hard questions. Should governments offer state employees jobs for life?

The West needs to tackle the great question that most countries have avoided since the 1980s: What is the state for?

The Covid 19 crisis has been a powerful reminder that the basic function of the state is the one that Hobbes defined: to offer its citizens protection.

In this case it means providing some kind of public health-care and welfare systems. The phrase “herd immunity” may be an ugly one but it gets to the heart of the matter when health is concerned: During a pandemic, the health of even the most privileged is dependent on the health of the least privileged. The fight against a virus is necessarily collective.

There is no doubt that the West faces as big a crisis as it has since the Second World War from the damage that is being inflicted by Covid-19. The great geopolitical question facing the world is whether the West can rise to the challenge as it has so many times before and rethink the theory and practice of government.

By Peter Buckley
Board Member
Primary Land Users Group

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