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We are a country obsessed with its overseas image. As we declare ourselves a leader on ‘climate change’, ALAN TITCHALL recounts the number of times we have rushed to the frontline in world conflicts to do more than our fair share.
New Zealand has a magnificent history of forlorn hopes – of being the first to rush into the breach for glory and promotion . Or, is it just the tyranny of distance and island insecurity that makes us feel that we must do more than our share on the front line of the world’s conflicts? It began in the early 20th century protecting our trade and other interests with Great Britain by leaping into the breach with every fight the Motherland got itself into. Premier Richard Seddon committed our troops two weeks before hostilities actually broke out in South African War of 1899-1902. In1914 we declared war against Germany on the same day as Britain did – the first non-European country to get involved in a conflict that claimed 58,000 Kiwi causalities. In 1922, just three years after the horrors of that Great War, and the founding of Anzac day, we were ready to storm the Dardanelles again over the Chanak crisis. The Turkish forces, at war with Greece, had advanced towards the neutral zone guarding the Dardanelles Strait and the British government asked its dominions if they would join a stand against Turkey. Every dominion told them to bugger off except New Zealand. Within four days about 15,000 volunteers (including a lot of ex-soldiers) had heeded the call from our sabre rattling leaders. Fortunately, the crisis was over before it started. Again, in WWII we were first off the rank, declaring, through a time zone muddle, war on Germany from the other side of the world at exactly the same time (if not a little before) as Great Britain. After that war, we traded UK for the US as our ‘superpower’ buddy and put up our hand for any trouble in Asia, and you could always find us on the frontline – Korea, Malaysia, and Vietnam. And there were trade rewards. During the Korean war (1950-53) the Americans provided the biggest wool boom in our history. In the 1970s we sheathed our bayonets to impress the world with leading political ideology. In 1974 came the world’s first (and last) Accident Compensation Commission – a no-fault scheme originally designed for the workplace and mostly paid for by ‘earners’ who are not only taxed in advance for their own potential accidents, but for also those of non-contributors and almost 2.5 million visitors each year. Neither the scheme, or the concept, has ever been emulated. In 1987 we were the first country to ‘officially’ become a nuclear free zone, as in keeping out US nuclear armed and powered ships. A noble act with a cost – we are still trying to wangle a free-trade agreement with the US, five years after Australia secured one. Although, our chances improved with returning to the US frontline in Afghanistan. In the 1980s we became a world leader in economic reforms embracing the faith of privatisation and the benefits of a free (read unregulated) market – thinking straight out of the University of Chicago school of post-war economics. One of the first acts of this neo-laissez-faire-ism was to cut subsidies to the agricultural sector – the engine room of the economy. Two decades later and we still stand alone on this battlefield, with our primary industry sector competing with trading partners who haven’t followed us unto the breach. And is it such a bad idea to subsidise some economic activity for the greater public good, rather than rely entirely on subsidising unemployment (and social ennui) with welfare handouts? We also overtook the Thatcher administration in the UK (one of the first countries to flog off public assets in the 1980s) in asset sales and placing a number of ‘essential’ services in private market hands. PetroCorp was one of the first public assets to go, just as oil and gas sectors were becoming significant players, while the State-owned Enterprises Act (1986) paved the way for the Electricity Corporation (ECNZ) in 1987, set up to operate on a commercial basis. That in turn, paved the way for our ‘market’ electricity wholesaling and retailing reforms in the 1990s. Two decades on and we are still sorting out the mess. Those SOE generators that survived the asset sell-off are expected to return a ‘market’ profit while providing an essential service to the public at ‘socialistic prices’ (and be corporate eco-heroes at the same time to support a contrived ‘green’ international marketing brand). The downside with privatising services essential to economic health is the risk that maintenance and strategic infrastructural planning is neglected in the pursuit of short-term profit targets. Nor is there guarantee that any efficiency gains from privatisation are reinvested in plant, or automatically passed onto the end user (consumer) – they are usually swallowed up by company profits, share dividends and executive salaries. Ironically, it was because of the unwillingness of private companies to take on the risks associated with constructing capital-intensive infrastructure, that governments took state control of essential services around the world in the first place. In recent years we have seen governments taking direct control again of deregulated sectors that have gone feral, such as the US financial market. In New Zealand we realised you can’t operate an economy dependent on long-haul trade and tourism without a secure national airline (and bought it back), or transport bulk goods to sea ports without a well-maintained railway. New Zealand didn’t go down the deregulated/privatised path any further than numerous other countries, but few did it with the reckless speed, naïve enthusiasm and forlorn hope that we did. Others, such as neighbouring Australian states, took a more circumspect approach. Just compare Auckland’s deregulated private/public transport with the efficiencies of the publicly owned, not for profit, state transit operation in NSW, for instance. We are now the ‘leader’ in emissions trading schemes, with the first such scheme outside of Europe, and the only one that includes forestry and agriculture. The casualty list is a work in progress, but the resource cost of wholesale electricity alone is estimated to jump from 8.6 cents per kWh, to 10.1 cents in 2010 when the electricity sector is bound by a $25 per tonne carbon tax. I heard it from at least two cabinet ministers this year that it doesn’t matter what you and I actually think about the IPCC’s hypothesis on climate change (and it wouldn’t the first time the United Nations has got its predictions wrong), our ETS is essential to the ‘image and sustainability of trade and tourism’. This is a simplistic view of both economic sectors. Less than half of our 2.4 million visitors are actually ‘tourists’ strictly on holiday – the majority of them are here for the purposes of business, education and (a huge chunk) visiting friends and relations (VFR). A whopping 40 percent of our visitors make a short hop across the Tasman from Australia. Do they care if we thrash ourselves with an ETS or not? The same question can be asked of our major trading partners – the likes of Australia, China and the US – and of our (mostly), high-density and low-value exports produced from a low wage, low dollar economy. These partners are going to trade retaliate if we take the position of a follower and not a leader over gas emissions? Nonsense. Meantime, unto the breach once more – ours is not to reason why. And if the cause turns out false, or the battle lost through lack of support – will we be the first to retreat from the field?
Energy NZ No.10 Spring 2009 |
If you didn’t know already, a forlorn hope is a military term to describe an initial wave of assault troops attacking against vast odds with a high risk of casualties, but with the survivors guaranteed glory and promotion.