24 August 2022

Supermarket competition - the morons are trying to fix a problem their friends create

I'm fairly convinced that the Cabinet of the Ardern Government is dominated by complete morons when it comes to economics.  It is akin to a selection of the candidates that Jim Anderton's New Labour Party/Alliance put forward in the 1990s, a team of well-meaning, earnest, but limited people who had supreme confidence in their ability to play the public and businesses as pieces on a chessboard, without much of a clue as to unintended consequences.  The key being they "mean-well", they think they are doing good for "ordinary" people (for they are not far removed from being ordinary themselves), by their wielding of heavy handed control over businesses and people who put their money and time on the line to be productive.

The announcement that the two dominant supermarket chains will have to provide access to their wholesale supplies is exactly of that ilk. To those who don't invest their own money or are directly responsible for investing other people's money (in that they lose money if they fail), this seems like a great idea to enable new supermarkets to be able to access supply chains, but it smacks of naive student politicians who have no sense of the consequences of their clunking fist.

The barriers to competition in supermarkets are not in accessing groceries from suppliers, but in obtaining sites where supermarkets could be built and resource consent to actually build them.  However, the ideological allies of the Ardern Government, in the form of the majority of local politicians across the country, have done all they could to make this difficult.

The Resource Management Act has enabled the supermarket duopoly by empowering local government to not enable zoning of more supermarket sites, and to require local government to pay regard to the supermarket duopoly when any business wants to build another supermarket.

It's got so silly that in Havelock North, with a new New World supermarket being built to replace the existing one on a constrained site, that Hastings District Council thinks it is optimum value for the community to buy the old supermarket so that it can demolish it and expand the local car park.  This is ridiculous.  Hastings ratepayers shouldn't be destroying a supermarket building so that a surface car park can be expanded, it should be up to investors to decide whether another supermarket might be opened, or a different large retail outlet.

Dr Eric Crampton of the New Zealand Initiative amply described the restrictions that well-meaning, earnest, but limited people with supreme confidence in their abilities impose on supermarket development in local government:

very little land is zoned for larger footprint grocery. And land with the right zoning is often tied up by restrictive land covenants forbidding their use in grocery retail...

If the would-be entrant managed to find the right set of sites, there’s another problem. Council consenting can take anywhere from months to years – or even a decade in some cases. And councils too often decide that a new retailer should be blocked if it would hurt the amenity provided by other retail centres

Then there is the Overseas Investment Office, applying its xenophobic approach to investment from foreign supermarket chains, with the full consent of the Ardern Government, along with liquor licensing laws (which are highly restrictive, and still absurdly prohibit sales of spirits in supermarkets). 

Instead of liberalising foreign investment rules on supermarkets, liberalising liquor licensing for supermarkets and forcing local government to remove barriers to building supermarkets, the morons have decided to take the approach that any anti-capitalist, socialist student politician would prefer - forcing supermarkets (retail outlets) to WHOLESALE the goods they buy from other wholesalers and suppliers, to rivals.

How would that work? (The morons in Cabinet would just assume some public servants can work that out, because they are clever people, like them)

Where on the planet do ANY supermarkets acquire their goods from their rivals on any meaningful scale? (Aotearoa's "special" so don't ask such a ridiculous question)

What incentives are there on an encumbent to not provide goods near expiry, or not supply only the goods that sell the worst to rivals? (Oh more public servants can fix that right?)

What's the deadweight cost of employing an army of inspectors to check whether each supermarket is appropriately supplying the right goods at the right price and quality to rivals? (JOBS JOBS JOBS.. with a fair pay agreement underlying them, WHY DO YOU NOT WANT WELL PAID JOBS THAT HELP THE POOR?)

Who is going to pay for the cost of administration of supermarkets wholesaling goods to rivals and who is going to pay for the regulators? (You, but you'll be grateful for how much less you're paying, eventually).

It's mind numbingly stupid. If you think the Greens are the dominant provider of stupid hard-left economics, then don't worry, they wholesale ideas to Labour, and Labour is now Labour of old. 

Labour that absolutely disowns the lessons it learned in 1984-1990, that even disowns how much Labour of 1999-2008 was aware that it couldn't turn its back on those lessons.

We can only hope that National WILL disown 1975-1984, because Jacinda Muldoon and her Cabinet of Muldoons are hell bent on policies driven by short-term populism and an overinflated sense of their own ability to change the world to fit what they want.

04 August 2022

What does the future of co-governance look like?

Power without being elected

With the impending passage of the Canterbury Regional Council (Ngāi Tahu Representation) Bill, New Zealand will have taken a giant leap in the direction of reducing democracy in local government. It's important to be very clear about what this means:

  1. Ngai Tahu will appoint two members of the Canterbury Regional Council (known as Environment Canterbury), they will sit alongside and have identical powers to elected members
  2. Ngai Tahu members will be selected by Ngai Tahu by whatever means Ngai Tahu deems appropriate
  3. Those councillors will have full powers to vote on spending, on taxes (rates), on buying and selling assets and on bylaws.
  4. No electors in Canterbury region will be able to remove Ngai Tahu representatives (except of course, those with authority in Ngai Tahu), includes those affiliated with Ngai Tahu who do not have influence with the iwi.
It's very important to recognise what government, including local government actually is. 

Government is an institution with the monopoly of legalised use of initiated force against people and their property, and it devolves some of that power to local government. 

Environment Canterbury has such powers, powers to forcibly take money in the form of rates and to levy the public for services, it has powers to make bylaws and has powers to constrain the use of property. 

In a liberal democracy the constraints on that power come in two forms:
  • Legislative constraints (as local government is constrained by legislation and regulation);
  • Local democracy (the ability to vote out and replace Councillors who exercise these powers).
Parliament has chosen to weaken the ability of Canterbury electors to do the latter.  The key element in a free liberal democracy is more the ability to peacefully remove people from power than to select those that exercise power, but this legislation removes the right of Canterbury electors to remove two councillors.  Indeed, those councillors are only accountable to those with power in Ngai Tahu, not electors at large.

This is literal corporatism, in which a corporate private entity exercises direct political power, with there being no effective means of removing them (except of course if Parliament changes the law to abolish their position).

Bear in mind there is nothing stopping Ngai Tahu proposing candidates for election now, or funding and supporting the campaign of candidates it approves of, but it doesn't believe that would be successful.  

Bear in mind also that members of Ngai Tahu who are Canterbury electors retain the power to vote for Councillors, they have that power now, but they will also have some influence (it could be a lot or it could be negligible) in the selection of unelected councillors.  Members of Ngai Tahu who are Canterbury electors get two chances at selecting councillors.

Some may say sure but non-resident ratepayers get a vote too. Yes they do, but it is a vote and if they were residents as well, there would still only be one vote. There are sound arguments either way about non-resident ratepayer voting rights, but that is a separate issue.  Note that there are plenty of people affiliated to Ngai Tahu who are not electors in Canterbury too.

Where next?

There are  other examples that have parallels to Canterbury.  The Rotorua District Council (Representation Arrangements) Bill, would have generated higher Maori representation on that Council than their proportion of the population.  David Farrar ably demonstrated how unjust that would have been, as each Maori ward councillor would have represented far fewer people than a non-Maori ward councillor.  The Bill was dropped  in part because the Bill of Rights assessment said Maori wards would have disproportionately higher representation. 

Wellington City Council took it upon itself to include two mana whenua representatives on Council Committees (not full Council). One each from Taranaki Whānui ki Te Upoko o Te Ika and Ngāti Toa Rangatira sit on all Council Committee with FULL voting rights. It justified the idea as contributing towards decision making, but this is frankly absurd.  Having voting rights for unelected councillors (which is effectively what it is) is more than "contributing" it is exercising power.  The representatives also get reimbursed by ratepayers, "by paying each iwi an annual fee, equivalent to the remuneration of a full time elected member, which is currently $111,225".  So ratepayers get to pay for representatives they cannot vote for or against, that exercise power over them.  6 Councillors voted against this nonsense, namely Mayor Foster, Councillor Calvert, Councillor Rush, Councillor Sparrow, Councillor Woolf, and Councillor Young. However, the majority prevailed (Councillor Condie, Councillor Day, Councillor Fitzsimons, Councillor Foon, Councillor Matthews, Councillor O'Neill, Councillor Pannett, and Councillor Paul).

Noting this already happens for Rotorua Lakes District Council, it has iwi representatives with voting rights on Council Committees.

What would need legislation is to enable full Councillors to be appointed by iwi rather than be elected by electors. 

It seems highly likely that the Labour Government, with full support from the Greens and Te Pati Maori, would endorse local government having appointed (not elected) City, District and Regional Councillors, with the rights to vote on your rates, bylaws, spending, sale and purchase of assets and planning rules.

Let's be clear this is NOT the same as Maori wards. In principle, if a Council wants those on the Maori electoral roll to have Maori ward councillors, as it is for Parliament, it does not undermine democratic accountability. Maori electors shifting from general wards to Maori wards changes their representation, but they are still elected and accountable to electors.

Having iwi choose representatives is the same as having any large private interest choose representatives on Council. Councils exist to provide certain public goods and services, but also to regulate activity including planning activity.  Iwi themselves have substantial commercial and property interests.  Consider if Councillors (as some do) have large property or business interests in a district, they are at least accountable to electors, but the iwi representatives are not.  

So could Labour, the Greens and Te Pati Maori require all Councils to have unelected Mana Whenua councillors? Of course.... but could it go beyond that?

Iwi selected MPs?

Te Pati Maori Co-Leader Rawiri Waititi has already expressed his contempt for democracy as being the tyranny of the majority. Now I SHARE this concern, which is why I want the power of government limited, but I don't share his objectives or solution, or his perception of the problem. He wants a separate Maori Parliament which would decide on matters for Maori, although does not explain how that would work in practice.  

Applying the principles of the Canterbury Regional Council (Ngāi Tahu Representation) Bill to Parliament would mean that all iwi would be able to appoint MPs to Parliament (perhaps with some proportionality? or perhaps each being equal?) to have the same voting rights as elected MPs (which Maori would continue to be able to vote for).  

That would make Aotearoa/New Zealand far from being a liberal democracy, as Parliament would be dominated by entities that themselves determine how to select people to exercise legislative power over people and their property. 

This isn't about race, this is about the exercise of powers of coercion and the primary means of constraining that, which is the ability of the subjects of that coercion to exercise a vote to change those exercising that power.

If Iwi Representation were required to enlist electors that are iwi affiliated, removing them from being able to vote for other Councillors (and indeed with numbers of Iwi Representatives proportionate to population of iwi affiliated electors), it would be completely different. It would simply be redesigning Maori wards to fit that model. The same in Parliament. 

If Maori seats were simply redesigned to be selected by Maori voters voting for representatives by iwi (and then there being some system to elect the appropriate representatives across multiple smaller iwi), it would also not be a problematic in applying liberal democracy.  However, if some MPs were just appointed, it would be undemocratic. 

Consider that Myanmar adopts this model, except it is the army that appoints MPs. 

Why do this?

Supporters of the legislation see it as implementing the Treaty of Waitangi, under the interpretation that the Treaty is not just about granting sovereignty over taonga and governorship to the Crown, but about a power-sharing relationship between the Crown and iwi (an interpretation that was largely confined to academic and radical political circles until the 2000s). 

If the Crown, represented by the liberal democracy of the New Zealand Parliament were separate and excluded Maori (as repulsive and Rhodesia like that would be) then this interpretation may have merit. Yet it does not exclude Maori, Maori have the same voting rights as everyone else, and both Maori and non-Maori vote for MPs who are Maori (and non-Maori).  In other words, Maori are represented in Parliament, their views are heard, and communicated by the MPs they elect, both from the Maori roll and the General roll. They are equal in their exercise of power to everyone else. 

Beyond that, consultation and engagement over public policy is extensive and is entirely within the role of a liberal democracy and for consultation with iwi to be treated as being part of implementing the Treaty.  Consulting Mana Whenua is entirely right and correct for local and central government, but when it comes to choosing who gets to exercise the monopoly of the use of legitimised force - through government- it should NOT be determined by unelected people.

For better or for worse, every single MP in Parliament, and up till now, every single Councillor in regional councils, territorial authorities and unitary authorities (et al) have their authority through public endorsement at the ballot box. The worst form of government every devised, except for all of the others tried throughout history, as Churchill was purported to have said.

Sure, I think most central and local politicians are utterly hopeless at defending the rights and freedoms of the public and private property rights, but their power is constrained by the ability of sufficiently outraged electors to throw them out of office.

Unelected politicians do not have such constraints. Be suspicious of anyone who is appointed to exercise legislative and tax raising powers.  

Environment Canterbury disgraces itself by actively seeking to weaken the power of its elected Councillors in this way, and Labour, the Greens and Te Pati Maori have all shown themselves to be parties in enabling this to come to pass. Imagine if Federated Farmers had appointed representatives on rural councils, or Chambers of Commerce on urban councils etc. 

Any future government should explicitly prohibit any local authority from appointing anyone to have voting rights in Councils or Council Committees without having been elected in local body elections, at a bare minimum.  

What's the alternative?

The role of liberal democracy in New Zealand needs to be able to be debated without the kneejerk reaction of "racist" from unreconstructed leftists and ethno-nationalists who want to shut down debate using pejoratives. 

Those who think mana whenua do not have a role in being consulted on local and central government matters are not helpful, because if the Treaty is to work in the context of a liberal democracy, then engagement and consultation is essential. However, mana whenua should not expect to exercise direct political power to erode or undermine the wishes of directly elected representatives of all electors in New Zealand (especially since they too get to choose those representatives).

Those on the radical left who think this is "white supremacy" and "neo-colonialism" ought to put up their models for a form of government, and have them subjected to scrutiny as to whether or not they can protect the rights of all individuals from unbridled power and the corruption of power which is much more likely under systems of those appointing people with power.  After all, the UK retains the House of Lords, with appointed politicians, who scrutinise and delay legislation (although they cannot stop it), as a hangover from a very much class supremacist view of government.  New Zealand should not replicate this sort of political structure.

After all, liberal democracy is now the dominant form of government in most of Asia, Africa and the Americas, and frankly it is only autocracies like the People's Republic of China, the Islamic Republic of Iran and Turkmenistan that question the validity of governments that are constrained by secret ballots and the essential, concurrent freedom of speech and the press. 

Have mana whenua consulted, include them on informal committees and boards used to advise Councils and Government.  Government and Councils can also include them in co-governance of assets or systems if they wish - the whole debate on Three Waters co-governance is entirely legitimate (sure I don't agree with the proposal, but everything local government does is entirely at the behest of Parliament, which grants local government its power, it is still fundamentally accountable to electors).

The co-governance of Urewera National Park and the Waikato River are enshrined in Treaty settlements, and there is no conflict between any of this and a liberal democracy, because elected MPs agreed to it.  

In liberal democracy power IS shared, between representatives by geography and representatives by political ideology and philosophy, and when enough electors tire of one lot, they replace them with a new bunch. Does it achieve much? Often it doesn't, but it does achieve one thing - it means that all of them fear causing so much disenchantment that they lose government or worse of all, lose their seat in power.  Ngai Tahu and all Iwi ought to value that, and ought not to be immune from it.

UPDATE: So Tamati Coffey is inviting other iwi to consider "this path" to better representation.  He introduced the Rotorua rorting local elections District Council (Representation Arrangements) Bill, so he's showing his colours around corporatist government. Maybe it would be better if the former TV presenter simply abandoned representative democracy altogether if he doesn't believe in it?