Hard choices

Colin James’s summing up at the Knowledge Wave conference, 3 August 2001

It falls to me to offer a summing-up. I shall do that as an intrigued bystander — and a fairly detached one.

I am a bystander because I am a journalist. A journalist’s duty is to be sceptical. That, as we learnt last night, is not well understood by scientists, though it should be.

I am a detached bystander because I am now within sight of the end of my working life. So, provided I can get a reasonable proportion of my superannuation offshore, what happens next to the New Zealand economy and society won’t have a huge effect on me, as I gently decay.

I am intrigued because I have seen this sort of conference before: the National Development Conference in 1969 — an earnest attempt to set targets, which the 1973 oil shock wiped out at a stroke — and the Summit conference in 1984 — a cynical, though brilliant, exercise in obtaining legitimation for Rogernomics. Can this conference be different?

I am also intrigued by the threats posed to this small, overfed, peripheral society by the information revolution, which is still only in its early stages and beginning to intensify as it fuels biotechnology — and by the attempts at the government level, to divine and seize the opportunities in that revolution, starting in earnest with Max Bradford in late 1998 and continuing under this administration. So of course I was intrigued by this conference the moment I heard about it, by accident, back in January.

And perhaps I should add this. I was hugely privileged as a journalist to be able to watch at close quarters an independence revolution — the independence revolution of this emerging nation when, in the 1980s, it found its “voice” in the arts and applied massive creative destruction to its whole public policy. I can’t think of anywhere else I would rather have spent the central years of my working life. And there is still much to fascinate me as we struggle through national early adulthood.

But if I was 20 years younger I would not be here. I understand exactly why bright New Zealanders who are looking for challenge and stimulation go live somewhere else. (And I don’t mean Sydney, which is just a bigger village than Auckland.)

The question this conference has in essence been addressing is whether 20 years from now someone like me will be saying what I have just said. Or whether, as it was for me 20 years ago, there is enough to make a good living here — and by good living, I mean challenges and opportunities and stimulation. As Helen Clark said on Wednesday, “if we don’t create opportunities for our people, others will.”

Well, I detect in this conference a stirring. I don’t want to put that too strongly — and as a journalist I will be on the lookout for the counterfactual in the weeks to come. Also, I know a number of you are here because the Prime Minister’s invitation was in the nature of a summons. And I know others of you have come here with varying degrees of scepticism.

But a measure of the stirring that I think is here is that this conference could not have been held two years ago or even a year ago. The disorientation and the sourness of the 1990s would have killed the idea at birth. I think the difference is that there is now spreading a sense that it is time to stop celebrating or bemoaning Rogernomics and to start building again. There is a new openness now, in several senses.

Perhaps that accounts for the paucity of demonstrations outside. This here is a glittering gathering of the elites. And in this society the very word “elite”, like the word “excellence”, is a pejorative — elites are different and they are dangerous. Politicians on both sides have used fear of “elite capture” as a reason for keeping a distance from this gathering. We as a society celebrate mediocrity, safety in numbers, not excellence. Even in sport, repeatedly stated at this conference to be an exception, we get a bigger kick out of kicking the stars than applauding their best efforts. The fear of excellence is a powerful barrier to catching the knowledge wave.

Yet even this gathering of elites has not attracted the sort of organised antipathy that it would once have been automatically triggered. The media coverage has not been dismissive. Something has been going on here.

So what is it?

The theme chairs have detailed to you the action points developed in those sessions. They have also distilled from those action points some connecting themes.

I want to make it clear that these are not some hidden agenda, devised out by dark forces to foist on you. They are a distillation from the ideas that came out of theme sessions. They are your ideas, not those of the conference organisers or even the theme chairs.

By the same token, they are not mine. I am merely the messenger.

The connecting themes are:

1. Excellence, the celebration of success � our image

2. Education

3. Research and development

4. Innovation � which is the implementation of research

5. Celebrating entrepreneurship

6. Networks

7. Building scale and developing clusters

8. Talent

9. Transforming institutions, both public and private

10. Innovative incentives


I repeat: these ideas are not my distillation of the conference. They are the theme chairs’ distillation. As I said earlier, I have been merely an intrigued bystander these past three days.

But perhaps I can offer some thoughts arising from what I have heard these past two and a-half days. If there is a stirring, what might it stir?

Let’s go back half a century. In the 1940s this country made a clear national choice. After 15 years of economic depression and war, our forebears firmly chose personal and social security. Thenceforth, when economic and social imperatives intersected, the social imperative was more often than not to be given priority. Governments for the next 35 years faithfully gave effect to this national choice.

In the mid-1980s this broke up. The political, bureaucratic and business elites reversed the emphasis. At the intersection of economic and social policy, economic policy was given priority more often than not. The bulk of the population didn’t agree — and the elections of the 1990s represented attempts to tell the elites that. A good part of the popularity of the present government is that ordinary folk think they have been heard.

Now factor in a third imperative, the environment. It is fashionable now to talk about a triple bottom line. The Prime Minister has promoted it as a guide for making policy judgments and assessing our performance as a nation and society. A truly integrated society will score well on all three.

We do well on the environment. We do not too badly on the social bottom line. But we have been sliding, relative to other countries, on the economic bottom line. We have hundreds of small medium-high and high-tech companies, operating in the international economy, making international incomes. But, beyond buying a few services, they do not spread much wealth very far. We have an archipelago economy, with lots of little islands poking up from a continental shelf that is gently subsiding.

That it is on the economic scale that we have been doing worst is reinforced in the ratings on the scorecard of five measures the New Zealand Herald published on Wednesday. If I have heard the Prime Minister right, that is also in very rough terms her assessment.

Why does it matter? For the good reason that if we don’t made the grade on the economic bottom line, at some point we will give ground on the other two for two long and the other two eventually will deteriorate, even if we give them priority. Genteel poverty is poverty nonetheless.

The question before this conference — and the country — is what we want to do about that. Do we settle for what we have? Or is it time for a new national choice to replace that of the 1940s? I think this conference has been saying that it is. Mick Brown said we need “massive attitudinal change”; Don Brash said radical changes in people’s attitudes and behaviour are needed. Paul Keating said nothing is more important to a country than the way it thinks about itself. It is the stories we tell ourselves that form our attitudes. I think the conference wants the storyline to change.

If so, then logically the new national choice would give primacy to the economic imperative. That is, to more often than not choose the economic imperative when it intersects with the social imperative or the environmental one — though it may well be that the economic imperative demands a choice for social or environmental investment.

And there are choices. Catching the knowledge wave is not to offer cargo cult prayers for deliverance by intervention of the gods. It is not a clip-on to what is already being done. It will require hard choices to be made about how we allocate resources.

This conference has not done that. This conference is, in the words of Gurion Meltzer this morning, a “spike”. It will fade quickly. So what is to follow the stirring there has been here?

The Prime Minister enjoined this conference to focus not just on what the government can do.

So here are a couple of things business can do.

One is to take a leaf from Lesley Max’s copious book. Lesley is an archetypal social entrepreneur. Business entrepreneurs should recognise the breed. They are self-starters and they achieve more than bureaucrats can. They also mostly cost less.

If we are going to extol entrepreneurship, as David Teece exhorted us to do, then it doesn’t make much sense to stop at business.

Just as we have a lot of little and some big business entrepreneurs, there are also a lot of social entrepreneurs around — or there could be, with encouragement and resources. They are people with bright ideas and boundless energy. They can extend and enhance, though of course not supplant, the government services. They could go at least some way to meeting Paul Keating’s injunction to find fresh ways to support the small and the weak in this globalised world.

Business grumps about government spending on social services as diverting resources from economic advancement. If business truly believes this, then it will go out and find the budding Lesley Maxes of this country and put resources in behind them, in partnerships. That way we might get better social services and more cheaply because less will be needed of the government services.

So next time you of the business community reach for the cliches about government spending, try some of Edward de Bono’s thinking first and look for a social entrepreneur to link up with. It might be fun. And it might even lift the profit bottom line if in the end there is a tax tradeoff. Some of you already do, I know. In that case, why not role-model for your peers?

The second thing business can do is stop treating universities as foreigners. Auckland University’s attempt to come out from the cloister and get business in the same room is a notable gesture. Can business reciprocate? If out of this conference an informal grouping developed designed to promote interaction between universities — and other educational institutions — and business, would you want to be involved?

If you say no that question you will be ignoring the lessons from a diverse range of the visiting speakers at the conference who have chorused that education must be more geared to economic achievement. You will also be saying no, on behalf of the private sector, to a new national choice that accentuates the economic bottom line for the next stretch of our history.

If there is to be rebalancing, there will be hard budgetary choices to make. Resources will have to come from publicly funded social and environmental activities to stimulate research, innovation and smart economic activity — to pump along the knowledge wave. Who has to do that? Politicians who need to be re-elected. So governments will need help.

But even if the parliamentary sheep can be genetically modified into the jaguars they all think they are at heart, that still leaves us a long way from a new national choice. Even if business, the universities — and the unions, which I think are now, under their new leadership, ready to play a positive role — and the government decide to make the hard choices, they are only the elites.

Sure, it is elites who get things done. Without elite activity, nothing much moves — which is why it is such a national disaster to be always bemoaning elites. But a national choice can be made only by the people. That is the lesson of the 1980s and 1990s. As Craig Norgate said, change leaders “must take everybody along”.

If as a country we are to truly reallocate resources across the bottom lines, that will require a switch of habits by ordinary folk in their everyday life. In short: less spending and more investment. Are we as a society ready for that? No.

So if there is to be change, a rebalancing of the triple bottom line to get us on the knowledge wave, there will need to be leadership. From elites outside the government, of course. And that includes the unions, who can carry the message to their membership and across into civil society generally.

But there will also need to be leadership from the government.

As I said in my Herald column on Wednesday: the government has the popular authority to take those risks but does it have the daring? Only if it has allies. If you go away from this conference saying to yourself “they” must do something, the conference “spike” will fade quickly. If instead you go away deciding what you, not “they”, will do, then this country might, as David Teece said, be “on the cusp of significant forward momentum”. Your call.