The Sunday Long Read- Growth For What?

Willis and Wonderland

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So, Nicola Willis has been appointed as the new Minister for Economic Growth and her number one solution is to encourage more tourism.

One question I was waiting for a journalist to ask her at the announcement was :

“Minister, what kind of increased Ferry capacity are you planning to deal with the flood of tourists you would like to see travelling between our islands?”

Or perhaps,

“ Given that you want to increase tourism throughout our country Minister, many of whom want to travel by car and campervan, do you still think it was a wise decision to cancel the two large ferries?”

But if those questions were asked at the media conference, I haven’t spotted the answers anywhere.

Willis’ new title, and indeed in the way Willis glibly talks about Economic Growth, makes it sound as if Growth is a no brainer, something to which we should all aspire. And achieving it, Willis would have us believe, is easy peasy. Just lower Visa restrictions, get more tourists coming to our country, flog off some bits of land or assets that are either highly desirable or might have stuff such as gold underneath it, make New Zealand a low wage low tax country in which rich foreigners can come to and set up exploitative businesses, and bingo! Growth! Success! GDP will increase and bring prosperity to everyone. Yay!!

Except ….we know that GDP ( Gross domestic product which is a monetary measure of the market value of all the final goods and services produced and rendered in a specific time period by a country) is not a good measure of economic success.

For example, if a burglar enters my house when I’m away, steals a lot of my possessions that I have to spend money to replace them , then the burglar and I have added to GDP. If I crash my car and it has to be repaired, or I have to buy a new one, I have added to GDP. If I get injured in that accident and require weeks of medical care and months of physiotherapy, I have added to GDP because of the money these professionals charge to fix me up.

So, in recent years, some economists have been searching for another way to measure the success of an economy.

There is, for example, the Human Development Index (HDI) or happiness indexes, which might offer a more holistic view of prosperity. These indicators take into account factors such as health, education, and environmental sustainability, emphasizing that true progress is not just about economic output but also about the well-being of individuals and communities.

When I was a kid the shops were closed on Saturday and Sunday, lots of people played sport, there was more family time and while you had less choice in the stuff you could buy, the 40 hour working week spoke of a quality of life many of us wish we had today.

So we need to talk more about what we mean by “quality of life” in our country and the kind of Growth we want.

Ask yourself – is foreign ownership of our homes and businesses really a good recipe for happiness?

Higher incomes do not necessarily lead to better health outcomes, greater happiness, or increased social well-being. Citizens of rapidly growing economies can experience longer working hours, higher levels of stress, and diminished leisure time, which can negatively affect their overall quality of life.

Growth can foster a culture of consumerism, where individuals define their success and happiness based on material wealth rather than non-material factors such as relationships, mental well-being, or personal fulfilment. In these instances, the focus on increasing GDP may actually detract from other aspects of social development, such as creativity, education, and community.

No Nicola. We need to push the pause button and think - What kind of Growth do we want? And why?

Then there’s the whole trickle-down neoliberal theory thing, ie. that if we allow wealthy people to make more (untaxed) money, we will all be better off. Well, we know that’s a crock. The gap between the haves and the have nots has been growing exponentially since the introduction of neoliberal economics into New Zealand in 1984. Inviting Big Money into our country to exploit more of our resources and keep more of our people on low wages, isn’t going to benefit the vast majority of us.

Foreign “investment” also comes at a cost to our environment. Historically, Growth has often been linked to increased industrialization, higher energy consumption, and greater use of natural resources.

In the pursuit of growth, many countries ,including our own, have sacrificed environmental preservation for short-term economic gains, leading to pollution, deforestation, and climate change.

What good is the type of Growth that triggers global warming to the point where you lose your home, your business or your family in a catasgtrophic flood or fire?

I don’t hear any talk of sustainable growth from Willis or the Coalition. Quite the opposite.

Dig a 7 kilometre long motorway sized tunnel under a Coromandel Kauri forest to mine for gold and make the investors of a Canadian mining company rich? No problem says Resource Minister Shane Jones. Go for it! And while you’re at it mine the sea bed for oil and keep polluting the planet!

Invest in Green energy solutions, encourage eco- tourism or set up a business recycling the gold and precious metals from old cell phones and electronic equipment ? Call them a bunch of ‘woke’ ideas and dismiss them.

Then there’s the new AI buzz word politicians like Judith Collins are throwing around as something to embrace as a pathway to economic growth. But rarely, if ever, do we hear them talk of the potential social impact AI will have in the coming years that need to be managed if productivity is not only to be maintained, but improved. Little things like job displacement due to automation and offshoring. Growing inequality, as we already are too well aware, can have serious social and political ramifications, leading to unrest, political polarisation, crime and a breakdown in social cohesion.

Let’s not worry about all that. Growth is good! Greed is Good! Who needs a Productivity Commission think tank? Fire the lot of them! Full steam ahead, to hell with the consequences and let the devil take the hindmost!

That, my friends, is my take on what Willis and the National/Act/NZ First Coalition believe.

I doubt they have asked themselves - Growth for what?

But this is a question we all need to ponder.

Do you want New Zealand to be a place where collecting stuff comes first, or where the well-being of people come first?

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If you want to consider viable alternatives to the exploitative Growth model Nicola Willis promotes, take a listen to Head2Head podcast number 31 that I recently recorded with the engaging political economist Dr Katherine Trebeck .You can find it by going to the Nativation bar at the top of this web page and clicking on Head2head

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