The good society as economic infrastructure

Metiria Turei punctuated her co-leader speech at the Greens conference on Sunday with frequent references to a green economy. Nothing surprising about that except that Turei’s brief is social policy.

Since he took over as the other co-leader in 2006 Russel Norman has set out to develop the party’s economic policy to the point where it would be taken seriously by non-Green commentators. The update in his co-leader speech on Saturday was another step along that path.

It is a nationalistic agenda — not least, in promoting Kiwibank as the government’s banker in place of Australian-owned Westpac. That sits uneasily with green urgings that people “think globally” about how to keep the planet habitable for humans. But it does fit the other part of that admonition: to “act locally”.

Local action includes evening up social opportunity, which is Turei’s brief. Her innovation on Sunday was to link that brief to Norman’s economic brief. She grounded her social policy ambitions in “compassionate green economics”.

Year by year the party is rebalancing its message to give more emphasis to human wellbeing, for which well-functioning ecosystems are critical, instead of “the planet”.

This is happening as officials — some, at least — are coming the other way. The Treasury, in its “living standards” paper mentioned here last week, is one example. Environment Ministry chief executive Paul Reynolds is another.

Reynolds will tomorrow evening give the keynote opening speech for a conference the next day on “biophysical limits” — the resource limits to endless growth in gross domestic product (GDP).

Reynolds does not go in for apocalypse. He will say the problem is not the earth running out of resources for humans to use but gross inefficiencies in management of the resources. He will make a special point about water, which could go a long way further by applying existing technologies and good management.

But Reynolds will note that in many countries green growth, the green economy and green industries are featuring on the economic agenda. (The green growth advisory group here is due to report this month.)

That agenda is reframing policy as maximising growth within sustainable biophysical limits. That will need, Reynolds will argue, a flexible and dynamic economic policy and in turn new and flexible institutions to break out of constraints imposed by existing political fears and received wisdoms about what can be done while still keeping voters onside.

Reynolds argues that the physical environment is part of the economic infrastructure and so, like roads, must be invested in and maintained for orthodox economic reasons.

That could fit Norman’s construct. Moreover, Turei’s setting social policy in an economic context might logically be stretched to argue that a well-functioning society is also part of the economic infrastructure.

Take that a bit further and you bump into the report issued last Wednesday which among other things says that early intervention can stop kids going off-the-rails as teenagers and maybe turning criminal. This is by the expert group co-chaired by Chief Science Adviser Sir Peter Gluckman and Otago University psychologist and vice-chancellor Harlene Hayne.

The finding is that kids who don’t get a good start are more likely to become economic liabilities (besides being social and personal failures).

The government’s response to this report is intriguing.

Social Development Minister Paula Bennett did not once volunteer a mention of the Gluckman/Hayne report in her interview on TV1’s Q&A on Sunday. Her focus was on getting some long-term beneficiaries into work. She did not even go as far as Bill English did at a Families Commission conference last month, when he drew on a part of the Welfare Working Group report which suggested using actuarial techniques to assess long-term costs and the value of early intervention. (Officials are seeking advice on what they term “a long-term investment approach”.)

John Key last Monday pre-empted the Gluckman/Hayne report by promising a response to the welfare report to take to voters in the election.

Then Nick Smith chose last Wednesday to re-announce his contentioius changes to ACC, also to be tested with voters in November.

Go back to April when Bennett announced a “green paper”, to be followed by a “white paper” next year on the needs of young people up to 18, how identify “at-risk” children, track them and help them and how much the government should get involved and how to go about it — the day before a conference on that very point.

Even given that Bennett’s green paper will pick up Gluckman/Hayne ideas, it kicks it safely off till next year. It is as if the government is nervous about this evidence — that it might thereby be committed to expense it doesn’t want and/or action out of character for a conservative government.

The question next year, past the election, is whether National can adjust old paradigms. The Greens are adjusting theirs.