Covid =/= Rogernomics

Written By: - Date published: 12:47 pm, April 28th, 2020 - 45 comments
Categories: covid-19 - Tags: ,

Some right wing neoliberal dude on Nine to Noon promoting this idea that we’ve been through a big upheaveal before, the 1980s/90s, and this can be a guide to how to manage a covid economy.

Let’s not forget that Rogernomics was intentional and caused a huge amount of harm for ideological reasons.

It’s not a good model to lean on. Seems to me that Rogernomics is more like what we would have had this year if back in February we had a government that decided to make the economy more important than people eg if we had gone for a herd immunity response to covid.

Whatever the economic rationales for Rogernomics, it was still a neoliberal and then a right wing neoliberal response rather than a compassionate, left wing, or progressive one.

It didn’t have to be that way.

Same now. We have choices about the value systems we use to underpin covid recovery. We also have choices about the social and economic frameworks we use, and using neoliberal ones to try and remedy a situation where neoliberalism is very sick indeed is kind of like pouring salt on the wound.

This applies to Labour too of course, and we’re still waiting to see how much Labour will be willing to step out of the cul de sac it’s been in for the past 35 years. Having a (voting) public au fait with the other options ups our chances of useful change.

Looking for other ways to think about this? The new paradigms that integrate social justice and ecology seem promising. Putting people and the environment at the centre and designing our responses out from that. The economy gets to serve the people and the land we live with rather than using us as resources.

Greenpeace NZ and the NZ Green Party are both putting out good material that presents this new, emerging framework in terms that are close enough to Labour so as to not scare the horses too much

Kate Raworth’s Doughnut Economics model is also a frame that can serve as a transition from neoliberalism and is based on values that work well in New Zealand.

 

This is about using a new way of looking at problems, so that we can see  solutions appropriate to both the covid problem and the wider contexts of climate change, ecology crises, and poverty/social decay. It helps us avoid being channeled into limited solutions by using old frameworks that may not be suitable for the task at hand. We don’t have to through the baby out with the bathwater here (god knows we don’t need another too fast, top down revolution), but we do need people in power, and in the public, to be fluent in a range of languages.

One of the things I like about the graphic is that work and income are placed in equal proportion to many other human needs. This opens a door to those needs being met in multiple ways, not just via conventional models that say you have to work x hours a week to be able to afford y goods.

There is an introduction to Doughnut Economics on Kate Raworth’s website here.

Also on Nine to Noon, the idea that the dole brings the risk of welfare dependency but we could have a UBI instead. Not quite sure how that works, as if welfare has magic powers that make people need their dole more than other people need their wages. But the left should be paying attention to when the right are interested in a UBI, because one of the big problems with a UBI is how to tory-proof it. Especially if it is done alongside dismantling welfare, long a right wing goal.

45 comments on “Covid =/= Rogernomics ”

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  1. Gosman 1
    28 April 2020 at 1:34 pm

    You missed his point. The issue is that just like pre-Rogernomics we have a lot of economic activity that is currently in an area of the economy that is unlikely to be poructive/profitable anytime soon. Moving these resources away from such activity is going to be difficult but we did do that during the Rogernomic era of reform and this time we might be able to do it less painfully by having more emphasis on retraining and even a UBI. That is something I thought many left wing people would be quite happy with.

    • weka 1.1
      28 April 2020 at 1:40 pm

      The frame matters. Because from a neoliberal perspective resources were moved within 5 or so years, but from a LW perspective, the damage was carried on over decades and we still haven't recovered. The idea that it worked but we could do it a bit more successfully now fails because Rogernomics was like COVID, only intentional and the responses to it continued neoliberalism and prioritised the economy rather than us having solutions that prioritised people. That Rogernomics limited some of the damage it did doesn’t mean it’s a good model to use as a comparison.

      • Enough is Enough 1.1.1
        28 April 2020 at 1:48 pm

        "We still haven't recovered".

        That is also intentional. No government since 1984, including this one, has undone the fundamental reforms that Douglas introduced to us.

        Despite being in opposition for 18 years, and denouncing Rogernomics during that time, Labour has failed to ever fix their history and reform the system, when they are in government.

      • woodart 1.1.2
        28 April 2020 at 4:31 pm

        buggerall silver left to flog now, so neolibs are phucked.

    • Enough is Enough 1.2
      28 April 2020 at 1:43 pm

      That's the key point that government needs to consider. How we move away from the parts of our economy that are now rooted.

      Douglas smashed them with a sledge hammer. Covid has done a very similar thing.

      The answers to that question is what the election will be fought on.

      • Gosman 1.2.1
        28 April 2020 at 4:22 pm

        If you don't move fast then you cause your economy a great deal of harm by continuing to invest precious capital in areas that are unproductive. It would be like pumping 100's of millions in to a NZ Cruise liner business when there are no takers. Better to retrain all the people involved so they can do something else.

        • woodart 1.2.1.1
          28 April 2020 at 4:34 pm

          another way of looking at things gosman, is for the gov to invest in some cruise ships, run them hard aground on the nth shore and theres your auckland housing crisis solved.

        • KJT 1.2.1.2
          28 April 2020 at 5:59 pm

          Yes. Like more roads, eh?

  2. Kay 2
    28 April 2020 at 3:03 pm

    The Ministerial Statements made in Parliament this afternoon offered a bit of an insight into the general economic paths the Parties wanted to go down. (Is it just me, or is it really hard listening to Simon speak?) Personally I could go along with what a lot of what Marama and Winston spoke about.

    (link not up yet)

  3. RedLogix 3
    28 April 2020 at 4:00 pm

    I've been looking at the 'donut model' closely. I can see the thinking behind it; but in my view it has a crucial flaw. It completely misreads the role of energy in human civilisation.

    I realise it's just a conceptual diagram, but you've referenced it a number of times. It's worth asking the question, what determines the conceptual 'diameter' of these two circles?

    My answer is this; the size of the outer circle is driven by the availability of energy to a society. (Other key variables such geography, technology and resources are tightly linked to this, but energy is the one ring that rules them all and can be conveniently used as a proxy to keep the conversation tidy.)

    Energy is what determines how effectively each of the nine constraints on the 'outside' can be managed. The diffuse, intermittent and low quality energy from photosynthesis means these constraints press in tightly, reducing humans to a narrow and poverty blighted existence. Concentrated, continuous and high quality energy sources enable progressively sophisticated technologies to expand the limits dramatically. The conceptual diameter of the outer circle is driven at root by the nature of the energy available. For every component of the 'ecological ceiling' that we are currently bumping into, there is a conceivable approach to shift it if we could access unlimited, low cost, zero impact energy.

    The inner circle by contrast is driven by complex social institutions that can only exist in a society stable, wealthy and prosperous enough to support a middle class that has escaped subsistence level agriculture. It grows in response to the outer circle expanding, following it as we build more prosperous, educated and capable societies. In other words the constraint limits that define the 'safe space' for humans to build civilisations is not innately static. Looking back at recorded history it's obvious this space is dynamic, and there is every reason to think it will remain so in the future.

    • Drowsy M. Kram 3.1
      28 April 2020 at 4:22 pm

      "Looking back at recorded history it's obvious this space is dynamic, and there is every reason to think it will remain so in the future."

      Agreed, there is indeed every reason to think (and hope and pray) that it will remain so in future. A couple of days ago I watched the film "ANTHROPOCENE: The Human Epoch" – sobering stuff. Maybe it will inspire more people to devise ways of expanding that outer circle (the "Ecological Ceiling"), although I'm not convinced that this is a realistic or sustainable means of escape from the bind humanity has engineered itself into. Do you ever wonder if the ‘ceiling’ is there for a reason?

      https://theanthropocene.org/film/

      • RedLogix 3.1.1
        28 April 2020 at 4:39 pm

        Yes that film offers a far more spirited and optimistic vision of the challenge ahead than Michael Moore's latest nihilistic effort The Planet of the Humans.

        At a complete tangent I offer you this short but superb clip from BSG. It's the moment the otherwise flawed, narcissistic, treacherous Gaius Baltar redeems himself and saves the human race.

        • Drowsy M. Kram 3.1.1.1
          28 April 2020 at 6:25 pm

          'Anthropocene' didn't fill me with optimism for the future of 'our' home. The stark reality is that humans have not been 'using' the Earth (their home) sustainably. Rather, they are degrading the shared environment and are either too pampered or ignorant or desperate to realise/admit it, even when presented with the facts. How intelligent people can maintain an attitude of denial as to the truly frightening path we continue to fashion for future generations is beyond me. Self interest?

          We can either change our (human) behaviours, or we can continue to behave as if natural limits do not apply to humans. This 'Above the Law' belief/attitude heralds the rapid extinction of many other species (just one rather obvious warning sign by which to quantify how unsustainable our collective 'directions' are), but f**k 'em.

          A couple of quotes from the film's trailer sum things up:

          "…this time in the geological record when humans have moved the planet outside its natural limits."

          "It could be a full scale catastrophic change."

          "There's no way to get back, we live now in a different world."

          There is no way back; careful consideration must be given to how we got to here as we ‘plan’ the next steps. The film’s cinematography is amazing.

    • Gosman 3.2
      28 April 2020 at 4:51 pm

      The main issue with the 'dough-nut' model is that it effectively does away with the need for politics. If you construct a society within such constructs what is it that your politics are going to be deciding? It has already been decided for you. Politicians then become little more than bureaucrats maintaining the status quo. I know that is what many on the left ultimately want but it is a dangerous way of running a nation.

      • RedLogix 3.2.1
        28 April 2020 at 5:00 pm

        It's a good question. If you pre-suppose the limits of the donut are static, then yes you are correct … all human endeavour is narrowed down to little more than shuffling deck chairs.

        My suggestion above is that it's more lively to think of the constraining outer circle as dynamic, it moves with time and circumstance, the ground shifts under us constantly. Which means as societies we are always engaged in a constant negotiation between what we already know what works, and what we hope might work … politics.

      • weka 3.2.2
        28 April 2020 at 5:08 pm

        "The main issue with the 'dough-nut' model is that it effectively does away with the need for politics."

        Lol, translation: such a model has no room for right wing slash and burn economics, nor neoliberal extract and pollute economics. It's ok, there can still be a left and a right, they just can't destroy the planet and people any more.

        • Gosman 3.2.2.1
          29 April 2020 at 9:12 am

          What will the left and right be deciding then?

          • weka 3.2.2.1.1
            29 April 2020 at 11:16 am

            all it's doing is shifting the Overton window*. If you think being right is inherently being anti-green I guess it would be hard to see, but there is a conservative end of green politics.

            Pretty sure that left and right would have disagreement over the inner part of the doughnut.

            *or maybe putting in a new window where a room was too dark.

      • Morrissey 3.2.3
        28 April 2020 at 5:12 pm

  4. Corey Humm 4
    28 April 2020 at 4:10 pm

    I don't trust Labour not to go the neoliberal route, it'd be madness to expect labour to ditch neoliberalism at this point. I don't trust Labour to have any new ideas, nothing we have come up with in 36 years gives any indication that labour will ever ditch neoliberalism, we brought it into country ffs , Labour will do what we always do flavourless policies supposed to please everyone but please noone a don't do anything. Labour govts historically were reforming govts, we haven't had an original idea since the 80s other than tinkering around the edges. Over the long weekend I decided I couldn't vote Labour again, that the party's unsavable and will not be renewing my membership, I will party vote green and electorate vote red, when it comes to economic policy I've zero faith in labour to get us through this, I don't have that faith in the greens either but the only way we'll get any economic change will be by having other parties force labour to do so, I wish a party like the alliance was still around but till then the greens will do. All I ask is labour stop calling themselves Labour and rename themselves after the party they most resemble, the Liberal party.

    • weka 4.1
      28 April 2020 at 5:13 pm

      I've been noticing myself lowering my expectations. Otoh, I think it's a process and I'm always grateful for people that have figured out that tactics and a broader strategy are more helpful than just trying to tear something down or walking away from it. So I agree that the only way Labour will change is if parties to the left of them are empowered by the electorate. We've seen this already with the Greens, especially on environmental issues, but also Turei was right and she shifted the whole debate on poverty and welfare.

      The thing that interests me is that covid gives Labour a way out. I don't expect them to jump, but more that it's a watching game to see how far they will step to the left. I also don't expect them to lead the way out of neoliberalism, but I do expect them to shift as the electorate does. In that sense, having the public talking about different models means we have some degree of influence.

      We've seen this with a UBI already. Labour toyed with the idea pre-election, put the toy away, and not it's been brought out again. What's really important right now is that the public get really well informed about what a UBI might be, so that we can have some input into whatever Labour look at doing (I favour a UBI/welfare hybrid myself).

    • In Vino 4.2
      28 April 2020 at 7:41 pm

      Join the club, Corey. I also party vote Green despite despair – the other parties all mean greater disaster.

    • Peter 1 4.3
      29 April 2020 at 6:23 pm

      Could not agree more, voted Labour once since 1984 do not see any reason to vote for them again

  5. NZJester 5
    28 April 2020 at 4:11 pm

    "Is kind of like pouring salt on the wound"? I think you mean is kind of like pouring salt on the fertile ground. Those neoliberal policies totally ruin the fertile economy and makes it go stagnant with little able to take root and grow for a long time.

  6. Tricledrown 6
    28 April 2020 at 8:26 pm

    Replying to Gosman retraining is the right idea so does the individual run up a student loan..or get free tuition.

  7. gsays 7
    28 April 2020 at 8:34 pm

    Great post, weka.

    Thanks for the introduction to doughnut economics.

    Who knew economics could be compassionate!

    'Imagine if businesses asked themselves; "Is our core business model helping to bring humanity into that safe and just space between planetary and social boundaries? Or at the very least, not profiting by pushing people out of it."

    • Shanreagh 7.1
      28 April 2020 at 9:56 pm

      Compliments Weka. And gsays for the wording below…

      'Is our core business model helping to bring humanity into that safe and just space between planetary and social boundaries? Or at the very least, not profiting by pushing people out of it."

      Perhaps we could nudge businesses into doing the triple bottom line accounting processes. It has been around for a while and perhaps is a little step towards the big picture doughnut economics.

      https://en.wikipedia.org/wiki/Triple_bottom_line

      Any strategic business planner should be able to wrap something decent in the way of ways to achieve the above and ways of measuring if we do achieve. It also has that magic 'stretch' that is beloved of business planners and is intensely aspirational.

    • weka 7.2
      29 April 2020 at 1:40 am

      thanks gsays! Hoping to write more about this.

  8. Maurice 8
    29 April 2020 at 1:13 am

    Now – how do we force these changes?

    … and what do we do to those who oppose and resist?

    • weka 8.1
      29 April 2020 at 1:39 am

      I'm a fan of tipping point theory. Once you have enough people on board, change happens naturally. It doesn't even need to be most people. This is one reason why it's good to build relationships in politics, and to focus on the people that get it and are about to get it, because they are the ones that will make the change in the required time. People who oppose sometimes have useful things to say (cautions), and sometimes are acting against good and need to be constrained (this is what we have conventional politics for).

      Or something comes out of left field (eg a pandemic), causing a lot of rapid change, and the trick there is to intervene in the appropriate points to make sure the tipping happens in the right direction.

      • Dennis Frank 8.1.1
        29 April 2020 at 8:16 am

        This: "Scientists at Rensselaer Polytechnic Institute[2] have found that when just 10 percent of the population holds an unshakable belief, their belief will always be adopted by the majority of people". https://en.wikipedia.org/wiki/Tipping_point_(sociology)

        Elsewhere I have read accounts of similar research identifying the threshold at a higher percentage. Could be that caveats deriving from context apply. If so, there's no general law to discover. However the unicorn hunt is still worth the effort: similarities of context will likely provide similarities of threshold. Another caveat from extent of contagious effect too – some glues hold a join more strongly.

        I've said it here before: paradigms are analogous to operating systems. People adhere to them to stay on track with society. So it's a deeper grip than mere herding. Sustainability requires a political paradigm shift. That was obvious when the Greens formed. Comprehension will not snowball unless the Greens resume restating the obvious. Propaganda 1.01 – derives from marketing 1.01 – people believe in a product as soon as they see the ad on tv enough times…

        • Maurice 8.1.1.1
          29 April 2020 at 10:15 am

          Ah!

          … so a litany of lies?

          Sounds like the cure is just like Capitalism!

          • Dennis Frank 8.1.1.1.1
            29 April 2020 at 10:42 am

            Truthiness is the current fad. Social reality gets co-constructed out of competing mass hallucinations added like spice to the general consensus about what's real.

            So indoctrination via repeating a message just plays to this part of human nature. It works. Capitalism works too, but not so well the further into the future we venture. Our economy is like a ship confronted with a storm on the horizon heading our way just as we are sailing thro a more local gale. Set a new course. Make the economy sustainable.

        • weka 8.1.1.2
          29 April 2020 at 12:04 pm

          I'm also hoping the Greens front foot over the coming months. Been good to see their output in the past few weeks.

          I'm also encouraged by how much NZ has quickly adapted around serious challenge. We've demonstrated that we can adapts socially/mentally, and then change systems fast. I can see this happening with climate action, albeit not so fast and the processes will be different I think. But I feel more hopeful now than I did before covid.

          • Shanreagh 8.1.1.2.1
            29 April 2020 at 3:11 pm

            Weka, In trade terms NZ businesses were/are regarded as 'fast followers'…so not first off the block entrepreneurs but just behind and having worked hard to knock out the fish hooks or valuing adding.

            It is therefore a bit strange that we are still so heavily into commodity trading. We must do this ie trade in commodities to keep cash flowing sending bulk logs, cheese and milk overseas. Keep our export fruit going etc.

            We want to keep value adding and fast following. Very good with the PM keeps saying that we are wonderful in getting ourselves this far. I think we are wonderful too. I want to keep that feeling too and the idea that any changes now are for locking in any Covid-19 gains to processes, keeping us healthy and this may lead to better ways on other things.

            I feel now that we have been stifled for a long time, without really knowing it. Having to survive on our own wits in out bubbles hopefully has unlocked something good.

            • weka 8.1.1.2.1.1
              29 April 2020 at 4:45 pm

              "Having to survive on our own wits in out bubbles hopefully has unlocked something good"

              Very good.

              My optimism comes from watching the non-commodity businesses I guess. I'm sure that dairy farming is still doing the same shit it was a few months ago, ditto Fonterra. I understand the value added concept, but I also don't see the point in running highly polluting and extractive industrial dairy farms to produce speciality cheeses for China instead of milk powder. None of it is sustainable.

              What I'd love to see is us transition to other models. What would happen to the dairy industry in a doughnut economics model? To me it looks exciting.

        • weka 8.1.1.3
          29 April 2020 at 12:07 pm

          "Propaganda 1.01 – derives from marketing 1.01 – people believe in a product as soon as they see the ad on tv enough times…"

          I struggle with how many people simply don't get the value in having 15 Green MPs instead of 6. The influence via MSM reporting alone is gold for shifting what people think towards more effective climate action.

  9. Shanreagh 9
    29 April 2020 at 2:06 am

    A much beloved quote from Gerge Bernard Shaw "Man & Superman' as it described a large group of farsighted siblings in our family.

    “The reasonable man adapts himself to the world: the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.”

    Not the pejorative meaning of unreasonable but the person who has a good idea and persists, gradually getting people to think about the issues. So eventually a tipping point.

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