David Clendon
Productivity gains or party politics?

This week the Productivity Commission has been given its first task.  The Commission came into being late one Saturday night last December, with the house under urgency, and the Greens the only party in opposition to it.

In the first reading speech I said of the proposed Commission :

“It could reinforce outmoded, destructive, and well-discredited neo-liberal approaches to economic growth… a new bureaucracy… that could become little more than a publicly funded think tank for ACT Party policy and the advancement of that policy.”

The Labour party, which supported the Commision’s establishment, has rather belatedly realised the error of its ways.

There’s not a lot of satisfaction (in this case anyway) of being proved right!  The appointment of former Act candidate Graham Scott to the commission, and the terms of reference for the first enquiry, speak volumes about the agenda playing out here.

The conclusion the Commission is clearly being encouraged to come to is that getting cheaper housing depends on us opening up the way to more urban sprawl, with the new outlying developments ‘served’ by motorways. The cabinet papers released by Rodney Hide last month spell out very clearly his  analysis of housing  unaffordability, so why go through the expensive farce of asking the Commission for advice?

I asked a panel of business people at  SBN’s  ‘Sustainability is Mainstream’ forum this week for their thoughts on improving productivity in the New Zealand economy.  The responses included more  investment and commitment to science, research and technology; staff engagement programmes  that create a positive company culture where employees know they are valued and listened to; encouraging health and fitness through good nutrition and exercise, so people not only live better lives but also become more productive.

Pretty sensible ideas, already proven in practice by successful companies.  No bogus research projects by a politically influenced commission required.

15 thoughts on “Productivity gains or party politics?

  1. Naturally, Adam Bennett, reporting on the announcement in the NZ Herald of April 1st, 201, advises that the Commission is already under fire for advancing the interests of developers and the political right.

    We live in a strange world when affordable housing is deemed to be of no interest to the working class. Indeed I well remember when affordable housing was a key policy of the Labour Party – and its financing and land development policies, and the capitalized family benefit, were highly successful policies and ensured generations of New Zealanders had access to affordable and high quality housing. Indeed, shortly after I joined the Oakland Project of UC Berkeley, a brief paper I wrote on these “leveraging” policies (as opposed to direct interventions in construction) ended up on the desk of President Nixon.

    Labour’s policies were attractive to the right at the time because the capitalised family benefit was one of the earliest, and most effective, applications of the Voucher System of providing Government services.

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  2. Yep, another waste of space that will be paid heaps of money to copy and paste stuff from the Act Party’s manifesto – just like Don Brash’s 2025 Taskforce.

    Like or Dislike: Thumb up 2 Thumb down 2 (0)

  3. Another group that Rod Oram, Mike Lee and other advocates of unaffordable land are determined to ignore are the many minorities who are entrepreneurial and want to contribute to economic growth and development.

    Joel Kotkin has just posted a fascinating essay on the New Geography Website. “The Best Cities for Minority Entrepreneurs” explains:

    “With the exception of Baltimore and Washington — whose growth is tied to the expansion of the federal government — the cities on our list enjoy relatively low housing costs. Minorities’ “American dream” generally does not revolve around an apartment in dense, expensive urban areas, but want an affordable single-family house.
    Land use and other regulations also play a role here, not only for housing prices but for entrepreneur opportunities. Again, with exception of the Washington and Baltimore areas, the fast-growing minority regions, and rapidly growing self-employed populations, are regions with diffuse, multi-polar and heavily suburbanized land patterns.

    The strip mall, much detested among urban aesthetes and planners often serves as “the immigrants’ friend,” says Houston architect Tim Cisneros. In places like Houston, Cisneros points out, Columbians, Nigerians, Mexicans , Indian and Vietnamese businesses usually cluster not in downtown centers or fancy high-end malls, but in makeshift auto-oriented strip centers, where prices are low, parking ample and the location within easy driving distance of various ethnic populations. You want a good Indian meal in Houston, you don’t need to head downtown, but to the outer suburbs of Fort Bend County.”

    When did the Greens become so elitist?

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  4. @Owen McShane 12:35 PM

    We live in a strange world when affordable housing is deemed to be of no interest to the working class

    Who is suggesting that? I don’t see that in the post at all. The Greens have policies to make housing more affordable. But urban sprawl isn’t one of them. What is the point in a policy that makes housing more affordable if it makes transport completely unaffordable?

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  5. Cheaper housing is now nothing more than a corrupt predetermined outcome in a right wing conspiracy ?

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  6. owen..do you have any financial interests in fringe-city land…?

    ‘suitable for development’…?

    (just asking..!..)

    (and you never did answer that question … if you were part of that climate-change-denialist-tobacco-apologist-arc..?

    ..so many of you climate-denialists also worked for big-tobacco…eh..?

    ..that is well-documented…

    ..were you one..?

    phil(whoar.co.nz)

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  7. People are not stupid and they make choices that optimise their costs and benefits.
    I could equally well ask what is the point of making transport affordable if it makes housing unaffordable.

    And of course we find that lightly regulated land markets make both transport and housing more affordable.
    This is because in such markets people can follow jobs and jobs can follow people – and of course there are normally more than one person per household and they may travel in opposite directions.
    Remember, transport is only about 10% of total household expenditure. The mortgage is much more.
    Where do you get your data from and how do you explain the behaviour of those minority entrepreneurs – or do you presume they are too stupid to know any better?

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  8. Phil U sorry about your dependence on conspiracy theories. I live on a two acre lot west of Kaiwaka. That is well beyond Auckland’s peripheral land.
    Your fixation on tobacco and related products is equally tiresome. However, I used to smoke lightly as a student but gave it up when I read the surgeon generals report which was a solid research paper generating solid recommendations. Anyone who believes smoking is safe is a fool or illiterate or both.

    However, as in all cases linking pollution to ill-health there have been ongoing debates about the effects of second hand smoke. I had to research the arguments when I was working with the Auckland Cancer Labs.
    Now I hate people blowing smoke into my face at a restaurant or party so I would the research to show a convincing link but at the time (and times change and I do not follow every issue) there was no evidence linking second hand smoke to lung cancer. Certainly, babies exposed to second hand smoke in the nursery of motor car had a high risk of respiratory disease and mothers who puff smoke into their infants’ faces are irresponsible to say the least.
    There is a tendency for one clear connection between a pollutant and disease to generate a whole lot of second rate research trying to build on the solid case.
    Similarly when I was researching the danger of asbestos saws just about everyone was convinced that any and all asbestos was highly toxic. This is not true. The asbestos fibres have to be certain length, and probably more important, those fibres are only dangerous to smokers because they lose the ability to clear out their tubes.
    The most famous example of exaggerated claims was the corruption of Rachel Carson’s excellent work on the danger of using DDT as a soil sterilizer to use these fears as an anti trade weapon against the use of DDT as an insecticide in Africa – thus killing about 50 million children who need not have died.
    One of Nelson Mandella’s great achievements was to tell the Europeans and Americans to get stuffed because he was not about to allow bad science to do such damage to African populations.

    Then there is the paper I wrote showing up the ARC’s corrupt classification of contaminated soils.
    I try to be on the side of the truth and try not to encourage poor journalism to keep crying wolf.

    So there you have it. I would like to think this will bring your ill informed smear campaigns to an end – but I suspect my claims will be to no avail.

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  9. so..owen…that’s a yes…you are an arc-ist…

    “..However, as in all cases linking pollution to ill-health there have been ongoing debates about the effects of second hand smoke. I had to research the arguments when I was working with the Auckland Cancer Labs.
    Now I hate people blowing smoke into my face at a restaurant or party so I would the research to show a convincing link but at the time (and times change and I do not follow every issue) there was no evidence linking second hand smoke to lung cancer…”

    ..i see you were in the second-hand-smoke-denial division…

    ..had a revisionist-upgrade on that claim…?…at all..?

    ..or is secondhand smoke for kids..in say cars…

    ..still aok in yr book..?..

    ..eh..?

    (..and all in yr own words…eh..?)

    phil(whoar.co.nz)

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  10. btw owen…i never asked where you live..

    i asked if you had any financial interests in any city-fringe land…?

    ..as so many pushing the keep-sprawling-barrow do…

    ..and what exactly was the auckland cancer lab…?

    ..was it a prototype denialist-scam..?

    ..’researching’..making the case…?

    ..did the tobacco industry fund it/yr research…?

    ..and the stories/links in this clutch leave you fairly naked..

    …eh..?

    http://whoar.co.nz/?s=denialist

    all yr tricks are there for all to see…

    ..eh..?

    (and hey..!..points for the chutzpah for calling me a conspiracy-theorist…

    ..and then admitting you scammed for the tobacco-industry…eh..?..

    ..not many would try that one on..eh..?

    ..would you like to try on a new nickname for size..?

    ..how about owen ‘second-hand-smoke’ mcshane…?

    ..does it fit…?

    ..or maybe just ‘smokey’..?..or ‘smokin’..’..?

    ..that’s more pithy…eh..?

    phil(whoar.co.nz)

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  11. Just to get back on track – my point in this post is to highlight that we know a lot about the causes of and solutions to low productivity, and don’t need a new publicly funded bureaucracy to find these things out.

    English draws a longish bow, between the Commission’s investigation and availability of capital, to ‘justify’ the proposal. But we already know that housing affordability would be much improved if we drove the speculation out of housing, using a capital gains tax (excluding the family home), and taking all the sweetheart tax breaks away from residential property investment in favour of encouraging investment in the productive sectors. Also a wider range of funding models for home buyers, especially first timers – shared equity, ‘sweat’ equity, more involvement for the community / voluntary sector.

    We don’t need to reinvent or rediscover solutions, just need a government with the political will to implement them!

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  12. I give up on trying to have a reasoned discussion with Phoolu.
    But I cannot let his smears of one of the leading anti cancer labs in the world go unchallenged.
    They were one of the world’s first true biotechnology companies in this field in that they designed drugs to bind to the DNA of cancer cells. Until that time we just screened natural products for anti cancer activity.
    The end result is that childhood leukemia is not a curable disease.
    Here is an extract from their latest annual report. I do not see any tobacco companies listed among their joint venture partners etc.

    After I joined the DFC in the late seventies my first successful license negotiation was between the Cancer Laboratory and Warner Lambert, and this joint venture continues to be fruitful to this day.
    Twenty years after the final signing of the Warner Lambert agreement the Society’s Annual Report for 2000 opens with the following:
    DIRECTORS’ REPORT
    The year 2000 brought much to celebrate for the Auckland Cancer Society Research Centre. Major contracts were received in late 1999/early 2000 from the US National Cancer Institute (development of tirapazamine analogues, in conjunction with Stanford University), the New Enterprise Research Fund of the NZ Ministry of Science & Technology (development of radiation-activated cytotoxins) and Pfizer Global Research & Development (development of antibacterials). This and success with other grants resulted in a significant increase in staff in 2000.
    We noted last year the 20th anniversary of the Centre’s research agreement with the Parke-Davis Division of the US pharmaceutical company Warner-Lambert. During 2000 Warner-Lambert became part of Pfizer Global Research & Development, and we look forward to continuing our relationship with them under this new arrangement.

    We are also continuing work on other topoisomerase inhibitors in collaboration with Dr Les Deady and his colleagues at La Trobe University, Australia.
    The joint venture company EPTTCO, established by Auckland Uniservices, the Institute of Cancer Research in London, and UK Cancer Research Campaign Technology and headed by UK-based Chief Executive Dr Trevor Twose, has continued to develop protocols for gene-directed enzymeprodrug therapy, in collaboration with Vion Pharmaceuticals (New Haven, US) and Onyx Pharmaceuticals (Richmond, US). Research on another class of prodrugs, radiation-activated cytotoxins, has also proceeded well in 2000, with two patents filed recently.
    At the end of 2000 the Centre had 64 staff, with skills covering chemistry, pharmacology, cell, molecular and radiation biology and genetics, and all have enthusiastically contributed to the year’s achievements. In addition to research work, staff members continue to provide substantial teaching input in the Faculty of Medicine and Health Sciences and the Faculty of Science.
    In particular, Associate-Professor Lynn Ferguson was appointed by the University to a half-time position as Head of the new Division of Nutrition in the Faculty, and Dr Graeme Finlay took up a full-time position as a Senior Lecturer in the Department of Pathology.
    As noted above, the Centre obtained major new contracts in 2000 from the US National Cancer Institute, the NZ New Enterprise Research Fund, and Pfizer Global Research & Development. Other new grants were received from the Health Research Council of NZ, the Auckland Medical Research Foundation, the UK Cancer Research Campaign, Onyx Pharmaceuticals and the University of Auckland Infrastructure Fund. Substantial core funding for the Centre continues to be provided by the Auckland Division of the Cancer Society. It is this sustained and generous support from the people of Auckland that makes the Centre’s work possible.
    William A Denny
    Bruce C Baguley
    This is a long entry for a report of this kind but it makes several points worth noting.

    These people deserve our support and respect not the cheap shots from Phil U who seems to regard any debate about scientific theory and outcomes as a clash between the wise and the denialists.
    He would have had a field day during the debates between Einstein and the Quantum theorists.
    I cannot quite figure out which side he would have decided to pillory.

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  13. so owen..are you denying that you were a tobacco-denialist..(second-hand smoke division..)

    ..who then moved on to be a climate-change denialist..?

    whoar..!..that’s denial upon denial upon denial…(you de man..!..)

    and are you telling us you never received any financial-support/trips-financed/w.h.y. from first the tobacco industry front-groups…

    ..and later the climate-change denialist front groups..?

    ..has peddling false-science always leavened your career..?

    …is it lucrative..?

    oh..!..and you never answered that ‘do you have any financial-interest in fringe city-land..?…eh..?

    simple questions…eh..?

    and btw…just what a self-congratulatory opening spiel for a company report has to do with anything..and from 2000…even..

    um..!..it’s 2011..there..owen..

    phil(whoar.co.nz)

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  14. David
    I wish it were true that Government knew the reasons for our low gains in productivity.
    But sadly, while they may know what is wrong at central government level they appear to be completely unaware of the loss of productivity and the loss of savings at local government level.

    Every day some family or company sees large amounts of their savings or capital wiped out by poor decisions or excessive extractions. I know of a family developer who has just abandoned a perfectly reasonable medium density housing project because, although they had been encouraged to apply, they found they had spent $300,000 trying to get to an operational consent and there seemed to be no end in sight.
    SO they walked away. We hear about families who have lost their savings by investing in finance companies but do not hear about the lost saving from corruption at local body level.
    My files are full of these stories and I have experienced similar examples myself – but when I threaten to seek a declaration from the Court the officials normally back down.
    Innovation is the kiss of death to your bank balance.
    This is why I am starting a campaign to let neighbourhood associations administer their own RMA affairs. Then we would be able to accommodate transition towns, and eco villages, and heritage precincts because power would lie with the people. Council would only have power over issues involving pollution of soil air and water.
    This is called sub local governance. I would have thought the Green Party would be all for it.
    And by the way it is the anti sprawl campaigners who line the pockets of speculators and land bankers.
    Land banking makes sense only if the land gains value faster than interest costs. And Smart Growth actually encourages what I call carpet sprawl. Lighter regulation allows small towns and settlements to develop where it suits the potential residents and they can be surrounded by open space and natural heritage. But the inevitable easing out of MULs as the land fills up behind them creates a creeping carpet.
    One reason Auckland has such a high density urban area is the lack of open space. IT becomes too valuable to be left as open space and is developed for residential, commercial or industrial use.
    And Phil I don’t own peripheral urban land. We own are family home and that is up for sale to get rid of the debt. But I do know the dynamics of urban development economics.
    AS I have said, we now live in a strange world where promoting housing is reported as a right wing plot.
    I remember when affordable housing and high home ownership was the key platform of the Labour government. Now seem think the working class families do not care if they cannot afford to own a home.
    And urban sprawl and commuter transport is hardly a worry for them. How many blue collar workers are employed in the CBD?

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  15. PhilU
    CAn you not telp the difference between a company report and the report of a lab funded by a Charitable Trust – the Auckland Cancer Society?

    I have never been funded by the tobacco industry for anything.
    Get over your fixations and make some effort to read what people actually write.

    I have never been directly involved in the second hand smoke issue. I simply recall the debate at the time and how at that time the evidence was week – except for young children in cars etc but they were not at additional cancer risk but WERE at risk of respiratory diseases, which in those days could easily prove fatal.

    I do not know the current state of the debate. I am no longer involved with cancer research but I do maintain contact with my past colleagues like Dr Bruce Baguley.

    But I waste my breath. I currently live on the pension and what I earn from my writings – Business columns here and children’s books in the US. While I am a pensioner I am determined not to retire because it is such a deadly disease. Much more deadly than second hand smoke.

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