• Making America Great Again?

    In his successful 2016 election campaign, Donald Trump used a number of slogans which he and his supporters repeated ad nauseam. They memorably included “lock her up” and “build the wall” – but the one that seemed to resonate most effectively with American voters, and still does, was “make America great again.”

    There is nothing wrong with the sentiment, but it has proved to be something of a chimera, since Trump has fallen into the habit of equating it with another slogan which is one of his favourites and which he also uses all the time.

    As he meets world leaders at the United Nations this week, we are assured in pre-briefings that he will be be focussed on “putting America first”. It is a further sign of his lamentable inability to understand how the world really works that he does not recognise the disjunction between the two slogans – that “putting America first” is not necessarily the best way to “make America great again” and might actually work against that second objective.

    If we look back at how the post-war global scene has played out, it is surely clear that one of the reasons for America’s emergence as the world’s premier power was the fact that they were willing to become the leading force in the establishment of major institutions that helped to create an international world order. It was not, in other words, their pre-eminence as a military or economic power, but their readiness to use that power, in conjunction with others, in international efforts to build peace and prosperity across the globe that made America a super-power.

    Trump, however, seems unaware that US support for the United Nations and for NATO, for the World Trade Organisation and for many other multilateral attempts to secure coordinated action on many of the problems facing the world, was what really “made America great.”

    Instead of embracing and reinforcing this valuable role, Trump has insisted on slamming on the brakes and going smartly into reverse. So, we have seen him tearing up the WTO rulebook, lecturing NATO on its failings and threatening to cut the US contribution to its budget, behaving similarly at the United Nations (where he has already cut or ended American funding for refugee aid -particularly in Palestine), abandoning the Paris Accord on Climate Change, withdrawing from the nuclear weapons agreement with Iran and re-imposing sanctions instead without regard for other countries (formerly regarded as America’s allies) who were parties to the same agreement.

    Trump of course has a point in that organisations like the UN and NATO have depended heavily on American financial support, but saving a few dollars – which, when spent in the past, could be regarded as the price to be paid for America’s dominant role and influence – is not necessarily the best (or any) way to “make America great again”. Trump’s disregard – perhaps even contempt – for the leadership role America has embraced so effectively in the past is completely at odds with – indeed, a specific denial of – the very elements which made America great.

    Across the board, we now see an American President who is content to sacrifice American leadership of what used to be called “the western world” so as to be seen to be “putting America first” through saving a few dollars and impressing his “base” with his “toughness” as the mid-term elections approach.

    There can be few examples on such a world scale of such a narrow mind failing to encompass and understand such broad and important issues – or of a major country deliberately throwing away its influence in the world. America may be many things under Trump’s leadership but “great again” is unlikely to be one of them.

    His other campaign slogans don’t look as though they will be much help either. Being “locked up” seems a more likely fate for some of Trump’s closest advisers than for Hillary Clinton, and “building the wall” is far away and fanciful as ever.

    Bryan Gould
    24 September 2018

  • A New Monetary Policy Needed

    Positive Money New Zealand is a voluntary organisation that campaigns for monetary reform. It is affiliated to other similar organisations across the globe and in particular to Positive Money in the UK. I have the honour to be its patron.

    The founders and prime movers in Positive Money New Zealand have been, however, a Bay of Plenty couple – Don Richards and his wife Sue Hamill. Don confesses that it was Sue who first developed an interest in monetary reform, and then recruited him to the cause. Sadly, Sue died a few weeks ago after a battle with cancer. Her ashes were interred at Hillcrest Cemetery in Whakatane last week.

    One of Sue’s last projects, now carried on by Don, was a petition to be presented to Parliament. The petition, (which can be found at http://www.positivemoney.org.nz/Site/petition/default.aspx), calls for a review of our current monetary system to be considered by a Select Committee in the hope that the resultant publicity (and the education of Select Committee members) might then stimulate the necessary pressure for change.

    The body of the petition sets out the case for change. It takes as its starting point the almost incredible fact – one still contested by many supposed experts, although confirmed by detailed studies produced by the Bank of England and other central banks – that around 97% of our money has been created, not by the government, but by the commercial banks, which create the money by simply making a bank entry in the accounts of those to whom they lend money, usually on mortgage.

    The banks, of course, charge interest on the money they thereby create ex nihilo (or out of nothing) and it is the interest they charge that produces their huge profits of billions of dollars which they then send back, in most cases, to Australia.

    What is really astonishing about this state of affairs is that the money supply – one of the key elements in determining our economic success or otherwise – is almost entirely controlled, not by our government or the Reserve Bank, but by foreign-owned commercial banks which operate entirely for profit and are in no way accountable to the New Zealand public.

    It is, however, the New Zealand public that pays the price and bears the burden of the inexorable and bank-driven increase in the money supply. That price is paid in the form of higher interest rates (which are needed to restrain the ever-increasing level of lending), an over-valued exchange rate (a consequence of the higher interest rates that attract “hot money” from overseas), a crippling level of private debt in our economy, a huge burden on our balance of payments, a diversion of capital away from infrastructure and productive purposes, and constantly rising housing costs – all of which we could do without.

    The petition proposes that we should change this inherently unstable system of money creation to one in which new money is no longer created by private and largely foreign-owned companies whose only goal is profit, but is issued only by the Reserve Bank under the direction of our elected government which would then be accountable to the people for its monetary policy, as it should be, but currently is not. New money could then be directed to productive purposes and would no longer simply fuel asset inflation, particularly in the housing market.

    This approach to monetary policy is not only endorsed by leading monetary policy experts, such as Lord Adair Turner, and applied by governments in overseas countries, such as Shinzo Abe’s Japan, but has a gold-plated pedigree right here in New Zealand, where Michael Joseph Savage’s Labour government in the 1930s authorised the Reserve Bank to issue interest-free credit in order to build thousand of state houses and thereby helped to bring the Great Depression to an end. Let us hope that the Select Committee will take note.

    Bryan Gould
    19 September 2018

  • Life Jackets Are Needed

    As we sit on our deck in the spring sunshine at Ohiwa and enjoy the warmer temperatures, we notice each day another unmistakable sign that spring is upon us. There is a large and growing number of small boats out in the bay – some, presumably, fishing, others just “messing about in boats”.

    Sadly, it reminds us that we will no doubt soon hear another rash of stories about lives lost at sea – many of those casualties involving those who should have, but weren’t, wearing life jackets.

    The constant urgings that people going to sea in small boats should wear life jackets seem to make little impression on those macho guys who think that it is “sissy” to take such precautions or on those who complain about the “nanny state” and say that it should be left to individual choice.

    The debate, such as it is, is reminiscent of the arguments when the law requiring seat belts was introduced. The same tired old objections were trotted out then – we should be allowed to make our own decisions and “a seat belt won’t help, but will make it more difficult to escape from a burning car”.

    But, with the carnage on our roads refusing to reduce and the undeniable evidence that the injuries suffered by those not wearing seat belts are greater than they need be, that debate seems now pretty much resolved.

    But was there ever any substance in the argument that the decision on whether or not to wear seat belts (or life jackets) should be left to individual choice? Is it really the case that it is no one else’s business and that there is no wider interest in trying to bring down the drowning toll?

    The first point to make is that the owner or skipper of the boat is usually not the only one involved. There will almost always be others on board and they will usually do what the skipper tells them or at least follow his example. If they are children, or inexperienced abut being at sea, the skipper has a special responsibility to them and their families to set the right example.

    And that is to say nothing of those, professionals or volunteers, who might be required to risk their own lives to save those whose lives are threatened because they couldn’t be bothered to look after themselves.

    But the consequences of setting the wrong example, with the result that lives are unnecessarily lost, go wider than that. Every life lost at sea will impact on others and will have consequences that society as a whole will often have to deal with. As the poet John Donne famously said, “No man is an island unto himself”. A family member who drowns will leave behind not just a sense of loss and grief for the bereaved family but perhaps, as well, dependants who will need to be supported – and such burdens will often become the responsibility of the wider society.

    We all have an interest, in other words, in trying to save lives through such small, practical (and surely not difficult) measures as wearing seat belts or installing smoke alarms or getting a Warrant of Fitness for our cars or, let us be clear, wearing life jackets. There is nothing very macho about not using your common sense and putting the lives of others unnecessarily at risk.

    From our vantage point above the great Pacific Ocean as it rolls in inexorably and on to our beach, we have on memorable and tragic occasions watched as boats have got into trouble and have foundered on the rocks further along the coast, with – inevitably – some loss of life. We have no wish to bear witness to similar tragedies in future, especially if they turn out to have been avoidable if only the simplest of precautions had been taken.

    Bryan Gould
    12 September 2018

  • Coalition Government Working As It Should

    It is increasingly clear that some supposedly expert commentators on the political scene have a poor understanding of how a parliamentary democracy actually works.

    The cardinal principle of such a system of government is that it is parliament – not the government – that makes the laws. If it were otherwise – so that government need pay little or no attention to parliament – we would have a quite different system – one that Quintin Hogg, later Lord Hailsham, characterised as an “elective dictatorship.”

    Under our system, the government must, in other words, be able to command a majority in parliament; otherwise it would not be able to pass new legislation. And it is here that things get a little tricky for countries like New Zealand.

    Like many other countries, New Zealand has a proportional representation voting system (in our case it is one called MMP). It is inherently unlikely that any single party will be able to secure a parliamentary majority under such a voting system all by itself.

    This is not an accident or a disaster; it is how the system is meant to work. The whole point of MMP was to ensure that parliament could not be steam-rollered by a single party and that parliament and government would represent a wider range of interests and views than those of just one party.

    That means that governments must usually be formed on the basis of a coalition agreement between two or more parties – and if the party with the most seats or votes does not itself have a majority, they need not be included.

    The parties which make up the coalition do not lose their identity and their separate view points and interests. They merely agree to work with each other and – by supporting each other on most, if not all, issues – to ensure the the government has some stability.

    But, consistently with the need for a majority if any particular law is to be passed, any one or more of the parties in the coalition can withhold their agreement to a particular measure and thereby prevent it from being passed if they do not support it.

    There is nothing remarkable about this. It is how the system is meant to work and it is entirely consistent with – indeed required by – the principles of parliamentary government. So, in the present coalition government, any one of the two parties to the coalition agreement, Labour and New Zealand First – or perhaps three if the Greens were to be included on the basis of their general stance of supporting the government on most issues were to be included – could withhold their support and prevent the passage of a particular measure, on the basis that without their support there would be no parliamentary majority.

    When the coalition partners occasionally do not agree on a particular issue, here is no reason, in other words, no reason to froth at the mouth, or bemoan the fact that National, with the largest number of seats but not a majority, is not in government, or to ask, who is running the government. A coalition government that has to muster a parliamentary majority to get its measures passed is what both our constitutional principles and the will of the people as represented by the outcome of the election both dictate; it is called democracy at work.

    So, when New Zealand First declines to support a particular proposal put forward by Labour, or if the roles are reversed so that Labour fails support something New Zealand First wants, we should celebrate, not fulminate. We have the best of all worlds – a more representative parliament, a government that has to take account of a wider range of opinion than just its own, and a coalition government that provides stability and a consistent strategic direction.

    Perhaps some of our commentators should pause to reflect for a moment before going into print.

    Bryan Gould
    13 September 2018


  • Who Do You Trust on Climate Change?

    I foresee a day when, perhaps fifty years from now, New Zealand celebrates St Michael’s Day, in commemoration of Michael Hosking and his achievements. Speakers at the celebrations will recall how the great man – almost alone – had used the pages of the Herald and other outlets to refuse to kowtow to the conventional wisdom and the opinions of virtually the whole of the expert scientific community on global warming and climate change, and had warned against abandoning the life style and economic activity that had served us so well.

    He had urged us to go on with the emissions – produced by the burning of fossil fuels and the perpetuation of what Margaret Thatcher once called “our great car economy” – emissions that were thought to create global warming, and he had added that New Zealand was so “fantastically small” that, even if there had been something to be said for the global warnings about global warming, what we did would not matter a damn. He argued that we should put ourselves first and set at nought any responsibilities we might feel towards our island neighbours in the Pacific Ocean.

    The speakers would go on to celebrate the fact that the experts had been proved wrong and that only those of robust common sense, like Mike Hosking, had spared us the quite unnecessary disruption that had been proposed in order to avoid a quite non-existent threat.

    There is of course another possible scenario. On that same day, fifty years hence, it will be conceded, after a long struggle against steeply rising temperatures, raging fires and catastrophic weather events, that New Zealand, with many other parts of the globe, was no longer habitable, let alone suited to the production of food. It is recalled that the “tipping point” had occurred perhaps 25 years earlier, when the increased warmth of the world’s oceans had melted the Arctic and Antarctic ice caps, to such an extent that the delicate balance that had ensured climate stability was destroyed, and global warming had not only intensified and increased sharply in speed but had become irreversible.

    That leaves just one more possibility. With the benefit of hindsight, we might celebrate – as we marked another fifty years of development as a nation – the wisdom of our leaders in introducing policies that reduced our dependence on fossil fuels and the internal combustion engine and, as a result, allowed us to arrest the inexorable rise in global temperatures, so that we could maintain our life styles and living standards.

    We might marvel that, against the opposition of the ignorant and complacent, we had had the foresight to make the changes needed and that, through those far-sighted adjustments, we had succeeded in continuing to feed not only ourselves but also those in other countries who depended on us for essential foodstuffs and who continued to pay us the export earnings on which our living standards depended. We might ask ourselves where we would have been if we had insisted on ignoring the facts and assuming that we could just go on defying the inevitable.

    Those with long memories might also recall one Mike Hosking who had tried to persuade us that we should ignore what was staring us in the face and should instead just carry on regardless. Speakers might warn against the kind of self-delusion that holds that there should be no concession to the facts if they are in conflict with our prejudices.

    Bryan Gould
    7 September 2018