AFTER NEOLIBERALISM:

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• AFTER NEOLIBERALISM
• THE GROWTH AND INNOVATION FRAMEWORK.
• After Neoliberalism? New Forms of Governance in
  Aotearoa New Zealand Symposium, Auckland
  University, December 13, 2004.
• While the author is a member of the Growth and
  Innovation Advisory Board the views presented in
  this paper are his own, and are not the official
  views of the Board and may not reflect the views
  of the other Board members.
• Brian Easton
• www.eastonbh.ac.nz

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• THE ECONOMIC DEBATE HAS BEEN BETWEEN
• Conservatives of the Left
• Radicals of the Right (Neoliberals)
• Modernisers.

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• Growing An Innovative New Zealand
• (February 2002)

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• What the GIF is Not
• It is Not the Knowledge Economy
• It is Not the Knowledge Wave
• It is Not the Top Half of the OECD in 2010
• It is Not the policy which The Business Herald
  presented

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• The Growth and Innovation Framework is
  characterised by the following eight principles
• A stable macroeconomic framework.
• An open and competitive microeconomy.
• A modern cohesive society.
• A healthy population.
• Sound environmental management.
• A highly skilled population.
• A globally connected economy.
• A solid research and development and innovation
  framework.

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• Stable macroeconomic framework
• Fiscally conservative
• Keynes was a fiscal conservative.
• But manage the budget deficit.

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• An open and competitive microeconomy
• Use the market mechanism to make economic
  decisions.
• However they are not ideologically committed to
  the market and where it is judged appropriate,
  they will overrule it.
• The government
• - has been willing to spend to promote culture
  and protect the environment
• - has reduced competition in some public provided
  sectors (such as education and health services)
• - has been willing to use public ownership supply
  where it judges failure by private corporations,
  (the creation of PostBank and the
  renationalisation of Air New Zealand and the
  Railtrack)
• - has tackled the infrastructural network
  deficit, funded by higher taxes (rather than
  continuing the neoliberal stasis because they
  could not work out how to impose private charges).

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• Neo-liberals see the market as an end in itself
  modernisers see the market as an instrument of
  economic policy. Where they judge it fails they
  use another instrument.
• Why should the devil have all the best tunes?
  (William Booth)
• What about the distributional impact of market
  adjustments?

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• A highly skilled population
• ERA vs ECA
• Workplace Productivity Group.
• Focus in core education is on improving
  educational performance by working with teachers,
  not by putting competitive pressure on schools.
• The principle is a more cooperative relationship
  between workers and management will lead to
  greater gains.

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• A globally connected economy
• A major difference between modernisers and
  conservatives of the Left.
• The Left were once the great internationalists,
  and remain so in non-economic areas.
• The Left need not be anti-globalisation.
• Rather than parallel Proudhonian nostalgia or
  uncritically promote globalisation as did a
  nineteenth century capitalism, they may, like the
  progressive socialists of that era, aim to
  harness globalisation for the common welfare.

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• A solid research and development and innovation
  framework
• Innovation (and creativity) is key to the
  governments thinking about economic growth.
• W.J. Baumols The Free Market Innovation Machine
  Analyzing the Growth Miracle of Capitalism
• Despite the traditional ambivalence of the Left
  towards capitalist businesses, modernisers have
  consciously decided to make an accommodation with
  capital.
• The moderniser priority is the social control of
  industry not its social ownership. Often that
  social control is best by leaving the business in
  a competitive market environment.

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• The Growth Culture Report
• A challenge to business, indeed to the whole
  economic debate.
• The public is not particularly interested in the
  economic growth as it is formulated in the public
  debate terms of higher GDP. They are not opposed
  to economic growth, but they want a different
  pattern of growth
• quality growth rather than quantity growth.
• The traditional Left would have no trouble with
  such a vision, nor would Baumol.
• But how to integrate these social objectives with
  the free market innovative machine, without
  undermining the latters contribution to national
  welfare?
• Neoliberals with a narrower vision of social
  objectives in effect, quantity growth with the
  rhetoric of freedom see no such difficulty.

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• The Government Vision (GIF)
• The short version is
• A land where diversity is valued and reflected
  in our national identity
• A great place to live, learn, work and do
  business
• A birthplace of world-changing people and ideas
• A place where people invest in the future

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• The longer version looks forward to a future in
  which New Zealanders
• Celebrate those who succeed in all walks of
  life and encourage those who fail to try again.
• Are full of optimism and confidence about
  ourselves, our country, our culture, and our
  place in the world, and our ability to succeed.
• Are a nation that gains strength from its
  foundation in the Treaty of Waitangi and in which
  we work in harmony to achieve our separate and
  collective goals.
• Are excellent at responding to global
  opportunities and creating competitive advantage.
• Are rich in well-founded and well-run companies
  and enterprises characterised by a common sense
  of purpose and achievement. They are global in
  outlook, competitive and growing in value.
• Derive considerable value from our natural
  advantages in terms of resources, climate, human
  capital, infrastructure and sense of community.
• Cherish our natural environment, are committed
  to protecting it for future generations and eager
  to share our achievements in that respect with
  others.
• Know our individual success contributes to
  stronger families and communities and that all of
  us have fair access to education, housing, health
  care, and fulfilling employment.

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• A modern cohesive society
• Does capitalist growth tends to generate rising
  economic (and social) inequality?
• Increasing inequality is inevitable. Under the
  neoliberal policies, inequality rose because they
  pursued pro-inequality policies.
• To what extent is this government is concerned
  with the degree of social inequality?
• It has taken some measures to reduce it, but it
  may not give the same prioritisation to
  redistribution as many of its Left critics.
• The government seems to give greater priority to
  the effects of policies which are not direct cash
  flows education, training and upskilling, and
  job creation.