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Hands Off

November 19, 2012 Leave a comment Go to comments

Many people object to government intervention, or interference if you want to give the process a more negative spin. We have all been encouraged to think that smaller government is better and that ideally we would all (especially business) be allowed to get on with doing productive things without any government bureaucracy getting in the way.

Of course I totally agree if you are simply talking about bureaucracy. I despise bureaucrats – they are the greatest hurdle to progress we all face today – and they exist at all levels, from the top of government all the way down to petty managers (is there any other type?)

But I don’t agree that government has no role in steering the country (and especially the economy) in the right direction. If that involves a certain amount of interference or even bureaucracy then I am prepared to accept it. After all, everything is about compromise, especially in politics, and the extreme views (no intervention at all versus total central control) are rarely the right ones.

The leader of the opposition, David Shearer, made a speech at the Labour Party conference in the weekend which I thought put it quite well. Here is the key part of the speech which I think summarises the main source of our current problems: “The problem is that in order to pull us out of this hole they’re turning to the very ideas that put us there in the first place. You know and I know: it’s not going to work. And that’s why we need big change.”

Exactly! We have relied on business and corporations to do the right thing – the thing that theory dictates they will do when left to operate without interference – and it hasn’t worked. The financial crisis was caused by banks being given free rein to do what they wanted. Well they did and almost brought down the whole global banking system. Suddenly the “hands off” approach was no longer appropriate and they had to be rescued through the government intervention they had previously rejected.

In New Zealand we relied on mining companies to ensure the safe operation of their mines and to become more productive as a result. What did we get? Third world levels of safety leading to the deaths of many miners and mines closing all around the country.

We relied on the market and the newly organised electricity industry to keep the aluminium smelter, a key industry, running efficiently in Southland. Now it looks like the whole process will fail resulting in disastrous loss of employment.

And I don’t even want to get started on the travesty which is the deliberate sabotage then shutdown of the railway workshops here in Dunedin.

Where are the successes? They seem to be rather thin on the ground compared with the endless stream of disasters we hear of every week.

This government’s policy of “hands off” is a failure. It always will be a failure because business in almost every case only acts for short term gain and to maximise their profit in the most simplistic terms. Our business leaders are almost uniformly a bunch of dishonest, cowardly, simple minded fools. Why would we ever trust them? It’s insanity.

There is hope in the horizon because the international acceptance of free market, laissez faire economics seems to have peaked. People are becoming disillusioned at its failure to deliver anything expect an increasing gap between the rich and the poor, increasing unemployment, and increasing emphasis on exactly the wrong things.

Bring on the next election where I am confident our current right-wing government will be unceremoniously thrown out. How much more damage can they do until then? A lot I think. They’ll sit around doing nothing, confident that their free market ideology will work. Well I guess that depends on what you mean by “work”, but I dont think it’s what most of us have in mind!

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