It never ceases to amaze me what short term thinkers National are. The plan (with the Maori Party) to gut the ETS highlights this issue very starkly. For the sake of short term appeasement of their backers in the polluting industries National are prepared to abandon the much more important long term considerations. Considerations like the environment. Lest we forget, the health of the environment is what sustains us all (and the economy too if it comes to that).
Even putting aside the damage to the environment and the foolishness of covering the costs of pollution with a blank cheque from the taxpayer, even putting those factors aside and thinking purely in business terms, National’s decision on the ETS is foolish short term thinking. Focused only on the cost of doing something, National completely ignore the much greater cost of doing nothing. They ignore the costs of the damage to our international image and branding. They ignore the fact that the ETS creates opportunities as well as costs.
But the stupidest outcome in business terms is the cost of uncertainty. National and Labour were engaged in negotiations which could have reached an enduring bipartisan consensus on carbon emissions. Instead, without even waiting to see if negotiations concluded successfully, National have thrown all that away. Labour have already said that they will revisit this issue the next time they are in government. An excellent Herald editorial sums up:
A bipartisan policy on a subject so important for long-term investment decisions would be a rare and splendid thing, giving all sectors confidence that carbon emission costs would survive the next change of government.
Sadly, those hopes have been dashed. The Maori Party has had a change of heart. The principles it proclaimed in its rider to the select committee’s report appear to have been rescinded.
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Relief in those industries will be tempered by the knowledge that the next government is quite likely to reinstate economic sense. That likelihood already makes investment decisions difficult. Such is the folly of National’s failure to embrace a bipartisan approach.
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The failure to seize this bipartisan opportunity was not John Key’s finest hour, as may be evident in years ahead.
I’m used to a government that thinks ahead. Labour set in place long term planning for the future, the Cullen fund and KiwiSaver. Labour spent nine years reducing government debt in preparation for the next financial downturn – which inevitably came. Labour hammered out a workable consensus on the ETS trying to avoid an environmental disaster – which will (if we continue on this path) inevitably come. In contrast the current government seem completely incapable of long term planning. National are narrow, short term thinkers, and it’s a disaster for New Zealand.
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