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Tuesday, June 24, 2008

John Minto: Ponder the cost of NZ’s US-like economic policies




We have all been sickened at the callous brutality in the killing of New Zealander Navtej Singh last week.

This father of three young girls was shot during a botched robbery of his bottle store in Manurewa.

This was not a planned, premeditated crime. It was a hapless, pathetic attempt to get booze and cash.

There is argument about the police response and the time taken before clearance was given for an ambulance to tend to Singh but while issues like this are important, they are dwarfed by the bigger picture.

For a long time now, we have been on a relentless downward spiral of social breakdown.

More than any other developed country we are undergoing nothing less than the transformation of New Zealand into a mini-America, a place where the rewards are great for the few while hopelessness grows for the many.

We tend to think other countries are on the same path but we are well ahead on the road to riches and desperation.

The gap between rich and poor has grown more quickly here than in any developed country over the past 20 years. We have the least regulated economy in the developed world but while we have low unemployment, this merely masks the degree of poverty and alienation associated with the working poor who inhabit our low-income communities.

But still we feign shock and outrage when the social consequences of economic policy repeatedly smack us in the face.

We tend to respond in much the same way as the United States. We want the Government to harden up on crime. Our major political parties, and most of the minor parties, compete to see who can be the toughest on lawbreakers. More and more extreme measures are proposed and then adopted into policy because the greatest political dread is to be seen as soft on crime. The mindless cry of the many is for tougher parole, more prisons and harsher sentences.

So while we worry about underfunded schools, long hospital waiting lists and poor public transport, we never question the amounts spent on the bottomless, dead-end pits which are our prisons. Already in the developed world we rank second only to the US in the proportion of our population in jail. We will surely overtake them if we try just a little bit harder.

The same people who want more in prison also applaud the arming of the police with pepper spray, guns, rifles and Tasers, and are ready to extend police powers at the drop of a hat. Civil liberties are for pansies, they say.

Lobby groups, well funded by the corporate sector, advocate for harsher sentences. Until, of course, someone is charged with the murder of a tagger when suddenly these same people spring to the defence of the man charged and claim the murdered tagger got what he deserved.

All this serves to divert attention from the reasons for rising crime. We need to accept that the increased crime we face goes hand in hand with extreme free-market economic policies.

It’s no coincidence that New Zealand’s economic policies more closely resemble the US market model than other developed countries which have not suffered social breakdown to the extent New Zealand has. The simple truth is there is a strong correlation between the degree of free-market economic policies and the degree of social breakdown. The US and New Zealand have big doses of each. Countries such as Australia have more moderate amounts of each and so it goes through to Scandinavian countries which have much more modest amounts of both.

So while there’s never any excuse for vicious criminal activity, neither is there any excuse for us not to recognise this relationship.

The unregulated free market has seen our low-income communities flooded with pokie machines, loan sharks, bottle stores and the garish glare of fast-food outlets. Community attempts to control these have been ignored by political parties which have been happy for this unregulated market activity to flourish on the backs of poor families and poor communities. Our leafy suburbs are not afflicted by these parasitical services.

Labour is unlikely to form the next government and future historians will point to its failure to deliver policies to build dignity and respect for families and communities. Just this year, Labour reduced business tax by 9.1 per cent while the working poor, facing big increases in the cost of living, will receive around 3%. Beneficiaries have received nothing and the 180,000 New Zealand children living in poverty is the result.

Some applaud New Zealand’s rush to become a US lookalike. The rest of us should ponder the cost.

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