Launch of the Auckland Regional Council’s strategic plan, 4 April 2001
I am an inmate of Wellington who thinks Auckland is better. Auckland is warmer. Its skies are more open. It has Waiheke Island just offshore and I have a shack there and the wine is outstanding. Its harbour is surely one of the finest water playgrounds in the world.
But I also despair of Auckland. What can you say of a village which swapped “City of Sails” for “First City of the Pacific” just when the America’s Cup challenge was getting under way? Or of a locality whose authorities could last month take seriously an advertising hoax: a slogan that cuts the place down to a questionmark?
You will have gathered by now that what is about to follow is not an authoritative analysis by someone who knows Auckland intimately. I am an outsider. My remarks will be the impressions of an outsider looking in — though I hope you will agree, not an unfriendly outsider (and, indeed, one who pays rates to Christine Fletcher). Please forgive me if I tread unwittingly on some corns.
Let me start with the unstable Kiwi psyche. We seem to be a nation of manic-depressives. A year ago we were in a manic phase, in the afterglow of the America’s Cup. Six months ago we were in a depressive phase, immobilised by the post-America’s Cup hangover. Now we’re manic again. Business confidence is strong; consumer confidence is strong.
There are too many dark clouds around to justify that confidence unless we are simply dead lucky. I guess we will be heading depressive in another six months.
A small inverted comfort flows from across the Tasman, where I have been for the past week. After years of smug superiority, Australia has crashed from its manic Olympic Games phase into depression — as unrelated to economic and social reality as our new manic burst. Nothing is going right: India has been winning the cricket, the Warriors beat the Brisbane Broncos, the dollar is in the bargain basement only a notch above our Pacific peso.
Sydney up, Auckland down; Sydney down, Auckland up. Since Auckland often apes Sydney, of course Auckland is manic-depressive if our post-colonial siblings across the water are.
But is all of New Zealand like this? Southlanders notice fads only long after they have passed and have either faded or subsided into normality. Southlanders hew to an even and unchanging suspicion of both good and bad fortune. To a Southlander, Aucklanders are as unfathomable as hobbits.
Right now Southland is doing OK as a result of lots of rain over the past two growing seasons. But is it manic? Leave that to the fickle sunstruck northerners.
I mention Southland, not just because I come from there — and can remember, when young, thinking Auckland accents were not much different from Australian — but to illustrate the dislocation between Auckland and the rest of the country.
The dominant city of a nation is often separate from the rest of the country, with its own economy and manners. London has been that way for four centuries. Paris, New York, Berlin, Hong Kong are also distinct from their hinterlands. These places define themselves. They are economies and societies in themselves. They are not simply important parts of the country they are in. London is not Britain. It is London, surrounded by Britain.
Is Auckland such a place? It has a quarter of the population and a third of the national income which means it stands out in this small country. But can we call it a city in the sense that I am using that word of London, New York and Hong Kong? Is Auckland a special place, a magnet, a generator of excitement and ideas and cultural identity? Is Auckland a place to aspire to, to journey to with anticipation, to make a stunning career in?
I think not. A small clue is that Auckland isn’t alone in its manic-depressive tendencies. Wellington is right in there, has been for a decade or more. But perhaps that is coinci-dence, or just osmosis working on a small capital from the wealth generator up north. We need to look a bit deeper to answer the question: Is Auckland a true city of the mod-ern world, a place apart?
First, I think, one should ask: Is there an Auckland?
There is an Auckland region. The fact of the Auckland Regional Council proves that. But the people who live in this region are flung out over a large area. They are blessed with six administrative centres, each with a blessed competing mayor and council — seven if you count in Franklin. They have three rugby teams and similarly chopped-up representation in netball and other sports. They divide into a number of distinct ethnic enclaves that if anything are drawing apart, not together. What does Kohimarama have in common with Otara, except an accident of proximity?
Are the people of the region Aucklanders in the sense that Londoners are Londoners or New Yorkers New Yorkers? Or, for that matter, as Dunedinites are Dunedinites? I don’t think so. Auckland is a geographical description rather than a coherent entity. There is perhaps an argument that Auckland City is Auckland, with hangers-on draped around to the north, west and south. But I don’t think most in the region or the rest of the country see it that way.
There is one sense in which Auckland does cohere but it is a negative one: Aucklanders do see themselves as apart from “the rest”. South of the Bombay hills is boondock territory. But who feels strong who defines herself or himself by what he or she is not?
If I am right in this assessment, Auckland can become a city in the sense I mean it, a true city of the modern world, only if someone or some part of it develops a powerful cen-tripetal force that draws all the parts into an epicentre.
Well, it is in one sense a centripetal force. For decades people have come to Auckland in large numbers and still do. Auckland is a migrant region.
In the 1950s and 1960s this was especially so, as business and job-seekers organised themselves to make the most of the bounded national economy we used to have, managed from Wellington. Skilled and unskilled, Maori and Pacific islander, head offices, fortune-seekers and the desperate, poured into Auckland. It was where the growth in jobs was and where business was done. It was a place of opportunity, feeding on its own success.
But the bounded national economy went west with Rogernomics in the 1980s and with it the strongest driver of all that internal migration (I include Pacific immigration as in effect internal, as part of our erstwhile empire).
Then in the mid-1990s Auckland got a very different sort of migration — of Asians looking after their investments or looking out a bolthole in case things went wrong at home or looking for a place of rest or seeking education in the English-language for their children. This was an international migration of the sort that might make a true city of the modern world. But Aucklanders put a stop to it.
And now Auckland is also an emigrant region.
The head offices that once moved in are moving on, to Sydney and Singapore and Hong Kong. What Dunedin and Christchurch and Wellington shed to Auckland in the 1950s, 60s, 70s and 80s, Auckland is shedding now.
Auckland’s icon companies are being broken up and sold to foreigners who run them from somewhere else. The really bright and ambitious see Auckland at most as a step-ping stone to somewhere more enticing and more rewarding. A Sydney chief executive told me this week that when he interviews New Zealanders for high-tech jobs in Auckland, he is invariably asked if there are jobs in Sydney.
Country managers of multinationals operating here are a disappearing breed: increasingly line and marketing managers here report directly to a superior in Australia or Singapore. And they are often youngish Americans or Australians or Singaporeans doing an unwanted stint on the periphery on their way up to a perch somewhere that matters. Australian CEOs tell me it is getting harder to get managers to do a tour of duty in Auckland.
Auckland is becoming a branch office.
The comforting news is that Auckland doesn’t have this on its own. Sydney and Mel-bourne have their own exodus and a gnawing angst that they, too are becoming branch offices. BHP has done a merger that half-removes that old icon from Australian control. The CEO of a major manufacturing multinational with extensive interests in Australia and New Zealand predicted to me last week that within 20 years large swathes of traditional manufacturing will have disappeared from Australia, as it has here.
Another Australian CEO told me that he is finding it harder to get New Zealand managers to work in Sydney or Melbourne. That’s a pity because he and quite a number of other CEOs across the Tasman have for some years been telling me New Zealand managers are highly sought after for special qualities of adaptability and innovation. But they are not resisting Sydney and Melbourne because Auckland or Christchurch is better. If they are going to leave, they are telling my informant CEO, they want to go to the real thing in the United States or Europe.
Auckland is a tiny pimple at the bottom of the world. Don’t forget it.
But Auckland has lost something more than its head offices and managers. Auckland has lost its national primacy.
Michael Cullen caused an uproar a few years back when he said Auckland was a weight on the nation. He was quickly put down. But actually, if you ask around, a number of senior ministers do think Auckland is not a driver of the new economy they want.
On this view, Auckland is still working off the hangover from its 40-year binge on pro-tectionism. Auckland was where the protected industries congregated. Those industries are nearly gone and have not yet been fully replaced.
Instead, the emerging wisdom in the cabinet (picking up ideas developed by Andrew West and others) is that the “new economy”, the “knowledge society” is not — or at least not just or not yet — snazzy high-tech ICT. At least for a time, the “new economy” will more be grown on grass or in forests or hunted in the sea than flashed on a monitor.
That’s simply because the country still depends for export cash flow heavily on those primary or extractive items (plus, of course, increasingly, tourism which is also mainly a low-value-added commodity). According to the new Wellington wisdom, applying “knowledge” to get higher value-added for farms, forestry and fish is the fastest way to get some “new economy” traction. If you doubt that, ask yourself this: if we don’t add knowledge to those traditional products, rural and provincial New Zealand will be a drag and the chances of us breaking out of our 40-year relative decline, let alone beginning the climb back to the top half of the OECD table, will be negligible. ICT will not save the country in that event.
And where does Auckland figure in this? Farming, forest products and fish aren’t Auck-land’s strong points. The logical place for a centre of excellence for fishing is not Auck-land but Nelson. New processing plants for trees will be anywhere but Auckland. Dairying and meat likewise. Wine — for all that the best red wine in the southern hemi-sphere is made just out to the east of here — is Hawkes Bay and Wairarapa and Marl-borough and Central Otago.
Worse, Skill New Zealand tells me that in a number of industries it finds faster take-up of higher-technology in Christchurch than in Auckland.
In my specialist field, Auckland has also lost its primacy. Once I could pick up electoral trends in Auckland which would translate to the rest of the country an election or two later. For the past decade the picture has been much more diffuse. Maybe that is just because our politics has fragmented and become cross-patterned. But that does not negate Auckland’s loss of electoral primacy.
In short, all Auckland has now upon which to claim primacy is size. Size brings with it, of course, its share of innovation and enterprise and new directions. But size alone does not vitalise the nation. Activity does — the sort of activity that attracts and holds those who can and will make waves.
So what can Auckland do?
If Auckland is not a true modern city and no longer has national economic primacy, does it have much of a future? What will it be and do after the America’s Cup is lost, as one day it will be?
First, Auckland can study what drives the ambitious 30-year-old. Money, yes, but, more important, stimulation, challenge, scary new demands; cutting-edge technology, design, music, thinking, business methods and marketing; elegance, crush and life of the sort the great Dr Johnson celebrated when he said that “he who tires of London tires of life”.
Auckland can’t provide that excitement — or at best can provide only a primer. And in many ways little provincial Wellington does better in the arts, for instance. Compare Helsinki — not so long ago the sleepy, Auckland-sized capital of a rustic country — and ask why Auckland can’t run to a superb new art gallery just for modern art.
But Auckland can at least aspire to provide that primer for the itchy under-30s. Auckland is populous enough, open enough to international, especially American, trends, peopled with enough returned expatriates. And it shouldn’t be fazed into thinking that providing a primer is infra dig: Sydney and Melbourne can barely do better these days.
A smart Auckland will expect its bright young to depart. On the very edge of the world, as this country is, and without the population mass Japan has, it would be a tragedy for those bright young people not to be the best they can be. They can’t be the best they can be in Auckland.
A smart Auckland will work out how to play a part in drawing on that diaspora to feed back into the economy and society here. John Hood has put that on the programme of his “knowledge wave” initiative. Michael Cullen talks of the “diaspora project”, though that is rather grand for what is not much more than unstructured musings at this stage. More broadly, the cabinet has, too late but at last, grasped that it must go out and hunt for bright young people to take the place of the fortune seekers.
What can draw those people? One is space to think. This is often called “lifestyle” but that word connotes surfing and skiing — and by the way is a big turnoff when jealous apparatchiks in head office in smoky, surf-less and ski-less Cincinatti or Cologne are divvying up world investment.
Surfing and skiing may be part of a life with “space to think” but I mean something dif-ferent: a pace and tenor of life which is conducive to doing thinking work that sells round the world. There are already many such people here and they do well, on international rates of pay or profit (give a bit), living a borderless life. We mostly think of these people as hermit Americans, Germans and Swedes in the Coromandel and Golden Bay but there is plenty of space — and a nice slow pace of life — right here in Auckland. And even some of our bright 30-year-olds will opt for that.
Genesis is part of this. So is Uniservices. Everyone in this room can think of examples of little, smart, internationally-switched operations — probably dozens if you put your mind to it.
This is not like frozen meat or screwing cars together which generated huge numbers of jobs and spread wealth widely among the populace. This is an archipelago of islands of energy, intelligence and income, not a solid continental plain of wealth and jobs for all, even the humblest and least skilled. So it isn’t a silver bullet train to riches. But it does plug Auckland into international high-tech and biotech. Auckland can be the place that develops and leads this as a national policy. John Hood’s “knowledge wave” initiative is an interesting step and the government has latched on.
One option might be to see what linkages can be developed with Australia: Queensland, for example, is putting a lot of effort into developing a biotech centre of excellence. It’s not Auckland as a world city. Rather, it is Auckland as a satellite city. But a smart Auckland would take satellite status in preference to irrelevance.
Much the same applies to services. What do those truly modern cities, those magnets for the young and the super-bright, sell? High-value-added services. The more Auckland can plug into those networks, even as a satellite, the better its prospects. Again, Auckland can be the place that develops and leads this as a national policy.
That doesn’t mean forgetting manufacturing, just as the “knowledge economy” does not mean forgetting farming, forestry and fish. But it does mean focusing only on high-value-added manufacturing, especially short-run. Yachts are a splendid example and one in which Auckland has the intellectual capital, from chemistry and physics to design and operational skills, to embed a strong competitive advantage. And there are ways to de-commodify tourism, though, like farming, forestry and fish, that is more likely in the regions.
I hadn’t seen the publication that is being launched here tonight before I prepared these comments. But Rod Oram was kind enough to send me his commentary and his analysis suggests there is a fair amount to build on.
Auckland might be the place that develops and leads a national policy in social policy. The government wants partnerships with social entrepreneurs. There must be dozens of social entrepreneurs in Auckland. And they are likely to be more at home with local councils than with rule-bound central bureaucrats. Increasingly, central governments are going to depend on social entrepreneurs to glue society together — as they rely on business entrepreneurs to grow the golden goose. A smart Auckland could take the lead off Christchurch.
And a smart Auckland could innovate in Treaty of Waitangi and multicultural issues. These are the country’s biggest challenges. The nation’s biggest region should be the logical leader.
Will we see that smart Auckland?
On the face of it the promise is not high. It’s too easy here — so why bother? It’s too divided — so why try too act coherently? It has lost to truly modern cities too many of the people who might mark Auckland smart. If I was setting out from Dunedin now, as I did 35 years ago, I would not see Auckland as a place to stop but as a place to pass through on the plane out.
There are some hopeful signs of a smart Auckland.
The mayors seem to be working positively at last, at least on transport. And that has drawn a positive response from the cabinet: Auckland has precedence over the rest of the country in roading strategy.
Auckland has the advantage of having the Prime Minister domiciled in its midst and a couple of other top ministers. And there is a developing diversity, even a festival that is not just sport (important as sport is).
Will the mayors go beyond transport to a push for a plugged-in Auckland? Will they move from the issues of the 1960s to the issues of the 2000s? Will they try to develop an Auckland instead of half a dozen separate patches? Will there be something after the America’s Cup?
That is for you to answer. Or maybe you now want to tell me where I’ve been getting it wrong these past 25 minutes.
In summary
my impression is:
* Auckland is not a truly modern city and cannot expect young people to sit around here making do with a convenient lifestyle.
* It has lost is national primacy; all it is now is big (by national standards) and separate.
* There are opportunities to plug Auckland into the movers and shakers of the world if Auckland is smart enough.
* There are signs Auckland might be getting smart.
* But there is a long way to go.