I have just finished reading the book I spoke about in my previous newsletter last month by Jane Kelsey, Professor of Law at Auckland University, The FIRE Economy. It is fantastic and a must-read for all New Zealanders.
FIRE is an acronym for what New Zealand and the global economy has been built on since about 1975 and stands for Finance - Insurance - Real Estate.
She says in the final chapter that there is a growing chorus of voices warning of a deep and prolonged decline in financialised capitalism. IMF managing director said in a recent report that the culture of finance needs to change. The financial services rules of free trade agreements, such as the proposed Trans-Pacific Partnership Agreement (TPPA) pose hard constraints. As a party, the New Zealand government is required to conform. It can be sued by other governments, and increasingly by foreign investors, for alleged breaches of these rules in offshore tribunals, not the domestic courts. If that succeeds, sanctions can be enforced against goods or services exports.
For example, Australian investors (who dominate New Zealand’s finance sector) do not have the direct route to enforce agreement investment protocol, but could relocate their legal entity to China, South Korea, Taiwan or Singapore, where existing liabilities apply. The risks to New Zealand would magnify if big litigators in the US, Canada and Japan did the same and gained those powers under the proposed TPPA.
She suggests that political parties world wide need to grow a spine and tackle these challenges head on and they won’t do that unless they know that they have the support of a vocal, organised and informed constituency.
She says that, so long as New Zealand remains captive to the myth that there is no alternative, the response of a government principally advised by Treasury seems destined to remain within the narrow neoliberal parameters of austerity. If we want at least the success of Iceland’s progressive interventionism and not Europe’s repressive, failed austerity, we will have to fight for it.
New Zealand has taken the lead at moments of transgression in the past. We can do so again because a progressive transformation is already under way.
I have a free copy of The Fire Economy to give away to the first person who emails me to request it.
If you have any questions after reading this information, go to Contact Us on our website www.DaltonPlan.co.nz and type in your request.
By Dean Dalton DBA
Director, DaltonPlan® Business Action Planning Limited.