Manufactured Manufacturing Crisis Report is “a Camel”

The DomPost editorial is scathing of the Green/Labour bloc manufacturing report. If they were school teachers prior to the current age of?enlightenment?where there is no failure they probably would have given it a D-.

Russel Norman, David Shearer and Winston release their report into manufacturing

Russel Norman, David Shearer and Winston release their report into manufacturing

“A CAMEL,” said Alec Issigonis, the brilliant engineer who created the Mini, “is a horse designed by a committee.”

Reading Manufacturing: The New Consensus, the Opposition report on the state of the manufacturing industry, it is difficult to avoid thinking of his aphorism.?

Not only have the report’s authors had to accommodate the divergent views of Labour, the Greens, NZ First and the Mana Party, they have also had to pay due deference to the manufacturers and unions who gave up their time to participate in an exercise that has no official status.

The result is a paean to the “good old days” when foreign goods were kept out of fortress New Zealand, export subsidies and research and development grants were there for the asking and profits and job security were virtually guaranteed because the public had no choice but to buy locally manufactured, or assembled, goods.

It was a golden time for the sector but, lest anyone has forgotten, it also was the era during which import licence holders bought television sets in Japan, paid Japanese workers to disassemble them, shipped the pieces here and then paid workers in Waihi to put them back together.

Gee…almost Muldoonist in its approach.

The report does not propose a return to the protected past, but it does advocate special treatment for a sector that has been buffeted by competition from low-wage Asian economies and wild fluctuations in the value of the dollar.

Among the measures canvassed are a return to a managed exchange rate, the reintroduction of R & D tax credits and a national procurement policy that favours Kiwi-made.

Unfortunately, the world has changed since those sorts of policies were affordable.

The hard-learned lesson of the past few decades is that New Zealand works best when it is flexible, nimble and resilient. We cannot expect other nations to buy our milk powder, wool and manufactured goods if we discriminate against their clothing and generators.

If there is one thing we have learned since the days of farming subsidies, it is that subsidies, protectionism and jingoism don’t help.

Free economies and free trade ar the key.