Posted on Aug 01, 2020
Recently the Greens announced a Robin Hood election policy that is interesting in more ways than one. Taking from the hard-working to channel it to those who have made different choices in life is obviously a blatant attempt to shore up their fading electoral base. But behind the obvious, it illustrates a major problem in government in New Zealand. There is no argument that inequality is a major problem. And that as inequality increases so does the potential for social unrest. One of the attractive aspects of New Zealand society over the years has been the relative homogeneity of our population. We just need to look at the United States to understand the way social fabric disintegrates as inequality increases. If we don’t address inequality, not just of wealth, but of opportunity, resources and education, then New Zealand will inevitably become a less attractive place to live.
We don’t disagree with the sentiment behind the Greens’ policy - an attempt to address the growing inequality problem. But all the policy really does is demonstrate that while their goal may be admirable, they actually have no plan. Because taking from the wealthy and giving to those without , is akin to giving a hungry person a sandwich. It makes them less hungry for the moment, and possibly grateful to the giver (although it could also be argued resentful of the donor that they have a sandwich they can afford to give away) but doesn’t solve the problem past lunchtime. The reality is that their policy would actually encourage intergenerational welfare dependence.
Unfortunately this thinking is symptomatic of too much of our political thinking – which spills over to commercial and consumer life. Let’s apply a band-aid to the problem, and kick it down the road for someone else to deal with it. We put a bunch of orange road cones out, as if that fixes the pothole. Instead of addressing the real underlying problem, and finding a solution to the problem, too often both the media and the electorate encourage politicians to apply a patch to the symptoms. We vote for personalities, rather than people who know how to get stuff done.
But back to the plan – or lack of it. There have been calls recently from several high profile, and probably well meaning, New Zealanders to tax the rich to a greater extent. There are many who are already accepting of the fact that increased taxes will probably be necessary. But again, raising more taxes does not address the problem. The problem is what is done with those taxes. The Auckland Council knows how to raise taxes (in their case called rates ), even though most ratepayers expressed the view that they should not. But in Auckland Council’s case we have to give them their due. They have a plan ! Their plan is to continue to reward a multitude of over-paid and under-performing employees with the largesse to which they have become accustomed.
Until we have a comprehensive plan as to what we will do with those taxes, it is simply showboating to exclaim “the rich should pay more tax”. We know from the evidence of giving to charities that New Zealanders are very prepared to contribute – if they believe their money is being used well. At every level there is too little thought given to the reasons for problems, and fixing the cause, rather than just band-aiding the symptoms. Perhaps understanding why type 2 diabetes is so common, and exerting some energy into eliminating the causes, would mean we wouldn’t need to spend so much of our health budget on the end result. Perhaps spending a little on increasing financial literacy in our school system would pay dividends in reducing poverty. We need to pay living wages – but at the same time enable people with the tools and knowledge to be able to make choices as to what they do with what they do have.
And rather than saying that the government needs to build one hundred thousand new houses , perhaps there is a case for establishing where the mis-match in size , configuration and location exists in the current housing market. Too often the answer to the problem is to throw more (Taxpayer) money at the problem, rather than understanding what the real problem is, and applying thought and planning to fix.
The problem is not confined to government. In our own sector we constantly see encouragement for short term thinking. Take a standard commercial lease. Preventative maintenance is to the tenant’s account.
Many tenants don’t want to pay for preventative maintenance. Then actual maintenance is to the tenant’s account also. Many tenants don’t want to pay for actual maintenance. Replacement of faulty building elements (such as a leaky roof) is to the landlord’s account. So rather than replacing, the landlord will often push back to the tenant to pay for patching.
Isn’t it time , in both the private and public sector, that we realised that having a long term plan, and executing it actually produces a better result, and ultimately costs less. But I suspect we are really just whistling in the wind.