This year's National-ACT supply and confidence deal goes futher than the previous one, prompting a lot of indignant questions about ideology, economic management and choice... and a few examples of hypocrisy
Is that the whiff of ideology in the wind? The National-ACT supply and confidence deal will lead John Key's second term government off the first term's more pragmatic road and down some very rocky by-ways indeed.
The plan to trial Charter Schools and pass spending cap legislation ties the government to action and moves this government two steps to the right. I'm intrigued that these are the battlegrounds John key has chosen to fight on.
ACT and National signed their supply and confidence deal yesterday, and in doing so fired the first shots of the 2014 election campaign. I say that so baldly because the agreement shows much more intent than the 2008 equivalent. The deal with Rodney Hide was full of taskforces, working groups and promises of supporting legislation to its first reading; National had wiggle-room. ACT seems to have learnt from that -- or National has proved more willing -- as yesterday's document is more prescriptive.
On the two most significant policies, National promises to trial Charter Schools and "legislate within the next two years" a spending cap on future governments. Now, trials can be found wanting and abandoned; two years is a long time in politics. But the promises go further than I would have expected from this Prime Minister. (I'm not including the welfare reform in this post because National broadly and openly endorsed most of the Welfare Working Group's recommendations and would have pushed ahead regardless of ACT).
My suspicion is that John Key will be interested in Charter Schools and more private sector play in education, but will be less than keen on a spending cap bill. Key will, at this stage, be happy to campaign on welfare and education reform, but does a government that significantly increased government debt as a percentage of GDP during the recession of its first term really want to argue that future governments should not have the right to borrow and stimulate the economy? Can it credibly make such a case? Would cutting taxes thereby increasing government borrowing, for example, be a policy condemned by a bill designed to "constrain... government spending"?
And does any government have any right to tell future governments how much they can spend? I would argue, strongly, no. It seems deeply unconstitutional and unwise for a current government to effectively try to set budgets for future governments.
Can a proper conservative such as Bill English really support this radical policy? This is a Finance Minister who back in 2008 spoke loud and long about New Zealand having one of the biggest stimulus packages in the developed world. I'm sure he'd rather have not spent or borrowed as much as he did these past three years, but he kept an open mind and reacted to events.
So just what level of hypocrisy would be required for him to turn around and vote for a legal spending limit that would bind the hands of future finance ministers?
Can John Key back such a law, having spent the past three years proudly and repeatedly claiming that National has "continued to protect the most vulnerable"?
Here's the kind of line he uses in a lot of speeches, to stress National's socially caring and non-radical face and fend off Labour from his centre-left:
“We have continued to protect the most vulnerable New Zealanders through extensive programmes such as Working for Families, New Zealand Superannuation and welfare benefits, as well as investing significantly more in health and education.
Yet yesterday's agreement says:
"National and ACT agree that New Zealand's current fiscal problems were caused by irresponsible increases in government spending between 2005 and 2008..."
Spending such as Working for Families, perhaps? Or increases in health and education? Point being, Key can't credibly claim on one hand it was good for him to continue the huge extra-spending of programmes such as Working for Families, but on the other say such programmes are so bad they must be legislated against.
Under this law, it would seem to me that we could never again have the sort of bold programme implemented by the 1935 Labour government. Ideologically, those on the right may cheer that. But how utterly undemocratic to think they have the right to tell voters they won't have that choice again.
And this from parties who argue they stand for choice!
Who knows what the future may bring. A second global recession or worse? A major health epidemic? War? Or the collapse of Air New Zealand, for example. Presumably the previous government wouldn't have been able to bail it out if the $885 million rescue package pushed it over budget.
I just don't see how any government has the right to set boundaries around the future, given the "unknown unknowns" that may arise.
To test the integrity of such a policy, let me ask two more questions: How would this Cabinet like to be told by the 1984 Cabinet what it can and can't spend? And what would right-wing parties think of a law passed by a left-wing government legislating a limit on cuts to government spending?
If you don't think either of those scenarios are a good idea, then I don't know who you can applaud this idea other than as an ideological victory of small government over big.
But enough on that. To separate the two subjects and so this post become too enormous, I'll start another post to have a think about those Charter Schools.