Friday, October 03, 2014

"There is no 'right' to help yourself to the taxes of others"

Each Friday I receive weekly e-mail newsletters from two think-tanks: The NZ Initiative and Centre for Independent Studies, Australia. Two offerings seem to dovetail this week and showed NZ in a more progressive (literal use of the word) light. Australians are impressed that John Key has persuaded NZ to accept welfare obligations (by token of his re-election) whereas their bureacrats continue to fight.

John Key, the incremental radical
Jenesa Jeram | Research Assistant |
They say the grass is always greener on the other side; for New Zealanders looking to Australia, it often rings true. The sun seems to shine a bit brighter there, the pay packets are a bit fatter, and they have koalas.

But times are changing. The decline in long-term migration figures to Australia is just one example. And the reason is simple: Australia may have cuddly koalas, but New Zealand has John Key.

When I attended a conference in Sydney last week, I was struck by the Australians’ enthusiasm for anything New Zealand in general and our re-elected government in particular. What surprised them was John Key’s apparent ability to get the public on board with his “radical” reform agenda.

Radical? Really? At least on our side of the Tasman, Key hardly ever gets described in such ways. And indeed, at first glance, not a lot has changed since Key first took office. National has preserved traditional Labour policies such as state-funded education and health care, Working for Families tax credits, interest-free student loans and KiwiSaver. And as long as Key remains in office, superannuation reform is off the table.

But this seeming stability obscures some changes that are indeed quite radical. Increasing GST and reducing income tax was no small feat. Nor are charter schools, asset sales, loss of lifetime tenure for state houses, and increased obligations for beneficiaries. As the Sydney Morning Herald’s Peter Hartcher put it, John Key “has coaxed his country into swallowing the pills of reform yet entrusting him with power once again.”

So here’s the paradox: Key’s government looks reformist from a distance but his policies do not appear to be particularly bold when looked at in New Zealand. The question is, how does Key manage the kind of blink-and-you’ll-miss-it reforms, whilst implementing some truly substantial changes to New Zealand’s policy landscape?

The answer to this conundrum is that Key exemplifies the art of what one might call “radical incrementalism”.

Key has a good sense for the electorate’s appetite for change. The public has to be on board– and reforms take time, patience and good explanation.

That’s the real story other countries can take out of Key’s incremental radicalism. It’s not about tricking your patients into swallowing the pills, or promising false cures that won’t deliver results. It’s about educating the public on why these pills are necessary to build a strong, healthy economy.

And hopefully, in time, the electorate will start demanding the pills themselves, with the knowledge a thriving economy transforms lives and living standards.

There is no 'right' to help yourself to the taxes of othersidea2

This week a parliamentary committee accused the Abbott Government of violating international human rights obligations because it wants to limit the hand out of tax-payer funded welfare benefits.

Welfare changes included in the May Budget set tough conditions for the payment of unemployment benefits to people under the age of 30. Failure to meet those conditions by hopeful recipients would mean no social security payments for six months.

But the Parliamentary Joint Committee on Human Rights, set up under the
Human Rights (Parliamentary Scrutiny) Act 2011 ruled that the measure was "incompatible with the right to social security".

The so-called "right to social security" is set out in Article 9 of the UN International Covenant on Economic, Social and Cultural Rights created in 1966. The Australian government signed up to the ICESCR in 1975, thereby committing to an endless, expanding provision of welfare benefits.

Today, many on the Left affirm the ICESCR provision on social security because of their commitment to alleviating suffering and need. Others on the Right are skeptical because of growing public expenditure, a rising tax-burden, and the erosion of incentives to obtain employment.  

But the reality is that human rights - as defined by the Covenant and applied by the Parliamentary Committee in relation to welfare - is a corruption of the true meaning of the term. There is no such thing as a human right to free-flowing and unrestricted welfare.

Human rights, as properly understood, grant individuals specific and important freedoms so that they can pursue their own life and well-being. These rights include the right to the freedoms of speech, religion, and conscience, as well as important rights such as the right not to be enslaved or tortured.

This is to say that human rights are intended to stop governments from acting at the expense of the well-being of its citizens. They create a space for freedom to live under the rule of law. In other words, human rights stop governments from interfering in our lives.

The problem with the 'right' to social security is that it sets out to alleviate a burden borne by some individuals by imposing a duty or obligation on other individuals. It is therefore not a right at all. The parliamentary committee's report criticizing the government for doing what it was elected to do is nonsense. The right to help yourself to the taxes of other people is no right at all.

Peter Kurti is a Research Fellow at The Centre for Independent Studies.


tranquil said...

A so-called "right to welfare" created by the U.N. What a surprise that such a communist, meddling, corrupt, leeching, pompous and incompetent group came up with such a thing.

I quote Thomas Sowell - "What is your "fair share" of what someone else has worked for?"

Judge Holden said...

Ah, so charter schools were National Party policy after all. Key told us all that he was forced into them by the great negotiating skills of John Banks. Another fib then.

Anonymous said...

Why are corporates bailed out?Why are 'too big to fail' banks reliant on Govt guarantees real or tacit?Why has an OBR been introduced?Why are all council contractual details ...'commercially sensitive'?Why do mainstream media 'educate' the public to direct their angst at those who barely manage to exist ,rather than those who are extremely wealthy and minimise their tax through trusts,tax havens and various device?

Lindsay Mitchell said...

Why are corporates bailed out?

ACT's ex-leader answered that in the WSJ:

"Politicians like to subsidize banks' risk taking with bailouts because their electoral prospects benefit from credit booms and suffer from the short-term pain of a banking bust that is not bailed out. The only way I can think of stopping them is to impose severe criminal penalties on anyone who arranges a bank bailout—preferably, life imprisonment."

Social welfare and corporate welfare are both corrupting.

Anonymous said...

Never saw any initiatives from ACT,regarding the issues I mentioned.They love tax avoidance, elitism,tax havens and class distinction.

Lindsay Mitchell said...

No. I think you would find that ACT want a much simpler tax system to discourage avoidance, and have no time for elitism or class distinctions. Their interest is in individual freedom. Not special interests or privilege capture. But nothing I say will change your faulty perceptions.

Anonymous said...

I would say that one of ACTs main bankrollers would qualify as one of the biggest beneficiares of govt 'largesse' in history!I am easily convinced by real fact instead of ideology.Have a very open mind.