Colin James occasional article on wellbeing economics for the Otago Daily Times 4 September 2018
The economy is about to crash, “business” is telling us. The Institute of Economic Research, by contrast, forecasts just-under-3% growth through the next five years.
Business wants National back in charge in 2020. That is a tribal reality. Simon Bridges would make business growth No 1 priority.
But will business’s negativity be self-fulfilling and take us back to the depths of the global financial crisis, as the ANZ Bank business confidence poll suggests?
Is it time to join the cabinet panic about the poll, evidenced in Jacinda Ardern’s “flashing great neon sign” pitch to big business last week?
There is Trump, China, oil prices, steeply rising global debt, overpriced sharemarkets and political-meltdown Australia. But not yet precise signposts to imminent disaster.
Is business is missing the point?
The Australian newspaper — which helped oust Malcolm Turnbull — last week headlined “news” from the Harvard Business Review that “workplaces benefit when employees feel that their efforts are being appreciated by their managers”.
This decades-old rubric might be news to ANZ poll respondents, Harvard and The Australian. But it is not to (future National MP?) Christopher Luxon, Air New Zealand boss and chief of Jacinda Ardern’s new business advisory council.
Luxon and the E Tu Union have a deal involving workers in some management decisions. Result: less aggro and higher productivity. Grant Robertson featured it in his 2016 “future of work” conferences.
Shane Jones trumpets a different view of Luxon. New Zealand First needs provincial anger at Air New Zealand to help it clear 5% in 2020. Hence another blunt Jones challenge to his Prime Minister — not a signpost to a second term.
For Jones it often seems to come down to: “The show must go on.”
But what exactly is the show? Dollars?
Yes, say Bridges’ press releases. He is touring grumpy small business.
Not many people would say no to more dollars — no matter how many they have, behavioural sociologists say.
But there are other things they want more of, too, or at least a fair crack at. Dollars don’t guarantee a good life. They are an aid not an end.
Which is the point of Robertson’s push for “wellbeing budgets”.
The 2019 budget, he says, will be more a change of form than the endproduct. He hopes for more for 2020.
The Treasury — short of capability, along with a number of agencies — won’t be able to get enough credible numbers by budget 2019 to fill out its living standards framework and flesh that into the “wellbeing economics” it has been exploring from early 2015.
Treasury’s exploration has a way to go yet, maybe way past 2020. It is still producing background papers, most recently on financial and physical capital, culture, the United Nations sustainable development goals and resilience in the face of risk.
Still, Robertson’s show goes on. Tomorrow he opens the third international wellbeing conference in Wellington.
Victoria University (VUW) and the Treasury are sponsoring this three-day affair. VUW urban geography professor Philip Morrison, who studies subjective wellbeing, is one of the original organisers of this conference series and heads this one’s organising committee.
Former Reserve Bank chair Arthur Grimes, now VUW professor of wellbeing and public policy, is on the organising committee.
Offshore keynoters include Edward Diener, an Illinois University psychology professor who advises pollster Gallup on measuring psychological wellbeing, Martijn Burger, director of the Rotterdam Erasmus Happiness Economics Research Organisation, Carrie Exton, head of wellbeing monitoring at the Organisation for Economic Development, and Jan-Emmanuel de Neve, an Oxford University behavioural economist.
Onetime National MP Marilyn Waring, world famous for her work on unpaid work, will inject some scepticism. Lincoln University’s Paul Dalziel, quoted in the 2015 Treasury “wellbeing economics” work, will update his take. Carla Houkama will inject a Maori perspective.
A Bridges government from 2020 would likely back away from this guffy stuff. Most business would cheer.
But hard-dollar capitalism has been its own enemy in recent decades, helping breed burgeoning populist politics in northern democracies.
A rigorous — emphasise rigorous — injection of wider “wellbeing “into economic discourse and practice could lift public confidence in capitalism.
To make it work the government needs to reorganise the way it thinks and acts. “Wellbeing” goes far beyond National’s simple 2011-17 “targets”, to complex “outcomes” which make real change in people’s lives. That requires government agencies to collaborate.
And that requires major state sector reform. Chris Hipkins is due to issue a discussion paper today. An aside: the paper is said to back a three-person state services commission in place of the current single commissioner, Peter Hughes.
Hipkins and Robertson see their reforms as interlocked.
Can business catch up? Or is grumping what it does best?