Let’s lay out the state of things.
New Zealand is broken and struggling to develop as it should. The economy has suffered a serious long-term decline. New Zealand is a low-growth economy and has been for too long. A major cause is that our productivity growth is one of the lowest in the OECD. In fact, we are one of the worst performers in the OECD. Our economy and standard of living continue to decline to the point where we might as well say both are going backwards – and they certainly are in comparison to most Western-style nations.
One problem is that while we like to think we are a first-world nation, in fact, like many developing nations, we rely heavily on agricultural commodities that face protectionist barriers in overseas markets. We are not very good at diversifying the economy.
We’ve had over a decade of weak or negative economic growth, stagflation, missed opportunities and misdirected investments.
As one commentator has noted: “…our undeveloped nation is increasingly unable to employ us, house us, care for us and give us the lifestyle we aspire to.”
What does it mean if our water, in many areas, is unsafe to drink?
As has been observed: “The roads, bridges, railways, airports, hospitals, schools, factories, and all the rest of the infrastructure we have built at great cost over the decades are in decay. The welfare state is collapsing on itself; it’s not only becoming unaffordable, it’s increasingly not meeting our basic needs, despite the endless billions being poured into it.”
This socio-economic and infrastructural collapse and malaise is occurring all around us “in the largest cities, in the smallest provincial towns and in the rural backwaters.”
Our sewage and stormwater systems, and our water pipes in many towns and cities are struggling to cope, having been built so long ago and yet not properly upgraded. The reason is the issue of cost after decades of neglect. Our roads need upgrading, there are too many potholes yet, like the below-the-ground infrastructure, the above-the-ground infrastructure suffers from the issue of how can rates pay for these when real incomes of people have been falling for two decades?
As a commentator has noted: “The inevitable and tragic result of our country’s mournful performance is the development of significant levels of poverty in our society” and while many struggling to find adequate housing may have jobs, the issue is “they’re not earning enough to afford decent housing.”
A significant problem is that we are losing our trained medical specialists and our teachers overseas, to better job conditions and much better pay and we continue to lose, over decades, our young skilled workers.
Again, a commentator has noted: “…it’s self-evident that we cannot afford to keep losing our youngest, most able and best-educated people. It’s self-evident that we will continue to lose them until our economy is once again able to offer the kind of work and pay scales that people with skills and initiative can get elsewhere.”
So, what is the root cause of our issues?
I’d suggest it is along the lines of this analysis:
“…we are in this predicament for a number of reasons. We have persistently lived beyond our means as a nation. Our government has persistently overspent its income. Many of our business leaders have persistently failed to invest in productive, competitive enterprises. We depend for a living largely on a limited range of primary commodities… we have been lazy in our attempts to deal with all these issues and we have lacked the imagination necessary to find genuine solutions.”
And in response: “Our nation’s survival is not going to hinge on zealously following any single policy. We have to accept there is no easy option, there is no free lunch, and no single guru has all the answers. We need to pursue a wide range of balanced policies. That’s something we’ve proved singularly unable to do as a nation so far, and look where it got us.”
The issue is we have lost confidence in government: they break election promises, they seem unconcerned with the public good and so we lack trust in our political parties and in our politicians. Too often they fast-track legislation and steam-roller political debate and discussion; while at the same time, our political parties have changed from being broad-spectrum parties to far narrower ones.
As another, deeply informed commentator warns: “You could imagine this country splintered into a series of sectional parties unable to agree, no policy direction, unable to agree on anything. If you get extremely heavy debt and political instability you really are on the South American route. I think we are close to that than people believe.”
That last commentator was Simon Upton back in 1991. In fact, all of that which I have laid out up to this point comes from a book published in1992: David McLoughlin’s The Undeveloping Nation; subtitled ‘New Zealand’s twenty-year fall towards the Third World’.
If what I have laid out above seems all too familiar, then stop and consider that it comes from a discussion that occurred 33 years ago. Back then the analysis was that New Zealand had failed to respond to the issues of the UK entering the European Economic Union in 1973 and then those of the global oil shocks of the next few years. The concern was that New Zealand had suffered twenty years of decline and poor decision making and the results were to be seen and experienced throughout the country. In 2025, it is 52 years of such issues.
The problems back then – as I would argue they are now – were that New Zealand lacked the social and economic development and investment, the educational investment, the entrepreneurial culture and support, the diversified economy, the levels of productivity, the type of welfare state-including how we fund it, and ultimately, the political and public will required to ensure we did not slide backwards.
It seems at most, all we are offered is ‘one step forward, two steps back’ over more than fifty years, across governments led by both Labor and National, across First past the Post and MMP. Any gains are soon undercut, and any possibilities of change get changed in turn, we are too vulnerable to both internal and external instabilities.
We are of course not yet in the third world; we have not yet fallen that far. But for over fifty years New Zealand has suffered from poor decision-making, poor social, educational, and economic investment and development, and poor leadership – at all levels of its economy and society.
But I’d suggest the real issue is we have never moved past that meaningless, smug, self-satisfied, complacent championing of the status quo of National’s 1975 election campaign poster slogan, under that archetypical Kiwi populist Rob Muldoon:
“New Zealand – the way you want it.”
If not, then why have we suffered the same issues for over half a century? For, across all parties, we too often fail to think and act beyond the ethos of the ‘you want it’ which is the individual outcome, at most the ‘your community, cohort or interest group’ outcome. It’s not “the way we all want it”.
Of course, we can never get to such an agreement or outcome but even if we start to think about better outcomes for all, we all too soon and easily slip back into ‘better outcomes for us – not them’.
As McLaughlin warned, to make sustained change and progress requires a consensus on what to do and then probably “a decade before there are significant signs of progress. On present indications that would be an impossible test of political and public will. Somehow we have to lower our expectations of achieving instantaneous paradise, yet simultaneously we have raise our long-term ambitions about the quality of the country we want.”
McLoughlin wrote his book to shock New Zealanders out of their complacency; 33 years on, I argue we need to hear again just how little we have really changed.
