Michael Reddell

Recycled rubbish - The Dismal Science

Sep 15, 2018

That’s the title of my former colleague Ian Harrison’s response to the government’s consultative document on getting rid of (some types of) plastic bags.  The consultation itself closed yesterday, but nobody supposes the consultation itself was remotely serious –  the irrational ban is going to happen anyway.  Having dug fairly deeply into the material used to support/underpin the consultative document, Ian illustrates just how little substance there is to the case. Here are his key conclusions Supermarket checkout bags do not materially contribute to littering.  Common sense and overseas evidence tells us that supermarket checkout bags are not littered frequently. There is more littering of very small bags, but mostly they will not be caught by a ban. Supermarket bags possibly contribute only around 0.1-0.2 percent of littered rubbish by weight. The Ministry has neglected to conduct a survey … Read More

Tossing away valuable emigration data - The Dismal Science

Aug 27, 2018

We had confirmation yesterday that departure cards are to be scrapped. This was flagged by the Prime Minister a few months ago, and I wrote about the issue here.   Since then it appears that there has been no proper public consultative process. As I noted in March I’m sure airlines and airport operators hate the cards.  There have been prevous efforts to get rid of them.  They are, nonetheless, a core element of the data collections (in conjunction with arrivals cards) that give us some of the very best immigration data anywhere.  In a country with –  year in, year out – some of the very largest immigration, and emigration, flows anywhere in the advanced world. We are told by the government that this brings us more into line with other countries On Sunday, Lees-Galloway said the … Read More

Plastic bags - The Dismal Science

Aug 13, 2018

There is a reason why we do not let primary school children make policy or vote.  They are children, precious and growing but prone to all the enthusiasms of children, easily influenced, and not responsible (as taxpayers or anything else) for their expressed preferences.   And yet, as the Prime Minister was reported, it seemed that the fact that lots of school children had written to her about plastic shopping bags was almost enough in itself to justify a decision to ban them.  And how many of those letters in turn were subtly –  or not so subtly –  prompted by teachers, themselves disproportionately likely (at least based on the sample I’ve seen over 10 years and four schools) to be Labour and Greens supporting? Has a child in central Wellington ever came home enthused by a teacher regaling them … Read More

Net-zero carbon emissions: a “massive economic boost”? - The Dismal Science

Aug 06, 2018

James Shaw, co-leader of the Green Party and Minister for Climate Change (surely Minister against it?), tells us he is working his way through 15000 submissions on the recent climate change consultation document.  I’ve done a couple of posts here on the document, and on the NZIER modelling used extensively in it, and I’ve chided both the Minister and his department, NZIER, and the Productivity Commission for simply ignoring the fact that our large-scale non-citizen immigration policy is a discretionary policy measure that drives up New Zealand’s carbon emissions, further increasing the economic cost of any variant of a “net-zero” target the government might choose to adopt.   But I didn’t make a submission: there are only so many hours in the week, and it seems pretty clear from some recent broadcast remarks from the Minister … Read More

Regressivity, petrol taxes, and ministerial PR - The Dismal Science

Jun 28, 2018

Someone around home mentioned this morning that there was a confused article on the Herald website about the progressivity (or otherwise) of the fuel tax increase. I didn’t pay much attention until I read the paper over lunch, when I was a bit staggered by what I found. This was the centrepiece chart The line of argument from opponents has been that the fuel tax increase will fall more heavily on low-income people. But according to the Herald’s journalist, channelling Phil Twyford.  in a startling revelation, the ministers claim that the wealthier a household is, the more it is likely to pay for petrol. They say the wealthiest 10 per cent of households will pay $7.71 per week more for petrol. Those with the lowest incomes will pay $3.64 a week more. I still don’t understand what the journalist finds startling. It … Read More

Why are we gifting so much to farmers? - The Dismal Science

May 29, 2018

Despite announcing yesterday a plan that aims to eradicate Mycoplasma bovis from New Zealand, there was no sign of the pro-active release of any background papers or analysis. We don’t have copies of the relevant Cabinet papers, or the relevant advice from The Treasury or MPI. Not that long ago, the incoming government talked of its commitment to open government, and now it plans to spend hundreds of millions of dollars of taxpayers’ money –  without, it appears, any additional legislation – without giving us, up front, any of the relevant papers. Here is the extract from the Minister’s statement yesterday The full cost of phased eradication over 10 years is projected at $886 million. Of this, $16 million is loss of production and is borne by farmers and $870 million is the cost of the response (including compensation … Read More

A generous subsidy that pays off? - The Dismal Science

May 10, 2018

Reading the Herald over lunch, I chanced upon a story under the headline $50m PhD subsidy pays off.   That is the $50 million per annum subsidy put in place more than a decade ago that allows foreign PhD students to study at domestic fees (apparently a saving for them for more than $30,000 per annum each), allows full domestic work rights for them and their partner, and free access for their children to New Zealand public schools. The story says it is based on a new report from Education New Zealand.  Education New Zealand, of course, is not exactly a disinterested party.  It is the government agency that champions the export education industry.  In their own words: ENZ is New Zealand’s government agency for building international education. We promote New Zealand as a study destination and support the … Read More

World War One and the New Zealand economy - The Dismal Science

Apr 25, 2018

Earlier this week, in the lead up to ANZAC Day today, The Treasury drew attention to an interesting conference paper written a few years ago by Brian Easton on “The impact of the Great War on the New Zealand economy”.   From the opposite end of the political spectrum, Eric Crampton described it as “really great”.  I’m not sure I’d go that far, but for anyone interested in aspects of New Zealand’s economic history –  especially bits on which there are few systematic treatments (and often only patchy data) – it is certainly worth reading. Easton’s focus is less on the details of how the economy did during the war as in supporting my contention that the war experience fundamentally affected the way we governed New Zealand.  I shan’t be surprised if economic historians from other countries come … Read More

Opinion: Economic growth within Environmental limits - The Dismal Science

Apr 20, 2018

That was the title of a speech David Parker gave a couple of weeks ago.  Parker is, as you will recall, a man wearing many hats: Minister for the Environment, Associate Minister of Finance, Minister for Trade and Export Growth, and Attorney-General.  Since he was speaking to a seminar organised by the Resource Management Law Association, this speech looked like it might touch on all his areas of portfolio responsibility. In passing, I’ll note that he clearly doesn’t live in Wellington.  He introduces his speech lamenting that New Zealand had just had its hottest summer on record.  Most Wellingtonians –  no matter how liberal (indeed, I recently heard an academic working on climate issues make exactly this point) – revelled in a summer that for once felt almost like those the rest of New Zealand normally enjoys.   … Read More

Visiting economists opine on NZ - The Dismal Science

Apr 19, 2018

Lots of people, even abroad, look at New Zealand’s economy.   For example, there are ratings agencies selling a commercial product to clients, and there are investment funds putting their own and clients’ money at risk.   And then there are the government agencies; notably the IMF and the OECD. Every year or so, a small team of IMF economists come to visit for their Article IV assessment.  New Zealand isn’t very important to the Fund: we aren’t systemically important, we don’t borrow money from the Fund, and we aren’t even part of any of the country groupings with traditional clout at the Fund (eg the EU or euro-area). And the New Zealand story is complicated –  there aren’t other countries much like New Zealand to compare us against and learn from, and especially not in the Asia-Pacific region … Read More