Published in the NBR of 28 May 2004
New Zealand is living in a misty complacency that our economic situation is improving and that "it's alright here".

The truth is that since 1951, and more particularly since 1973, New Zealand's standard of living relative to other countries has fallen consistently and continues to fall.

Energy Minister Pete Hodgson told a conference recently, "I was born 52 years ago in a country whose living standard was the third highest in the world. Now I live in a country that is 25th."

The Treasury says "while our growth rate is projected to be around the OECD average for the foreseeable future, that's not going to be enough to catch up."

The most serious problem facing New Zealand is our lack of prosperity.

Do we care? Not much. A UMR poll in January this year showed a very high level of contentment with the ways things are. " New Zealanders are basking in the golden weather of national optimism, topping off a three year high in the country's mood", one newspaper reported.

Despite all the different policies we have pursued, all the brilliant strategies developed, despite all the sacrifices we have made and despite all the hurt and anger that various reforms have generated over the past thirty years, other countries have done more and performed better.

Former All Black captain Anton Oliver says that many top All Blacks could make two to three times as much money playing overseas, but "we want to be All Blacks, and the thrill of playing for our country is what keeps us here. (But) being an All Black won't be enough to keep people here forever," he said.
Chief executives are paid up to 45% less in New Zealand than in Australia for the same job according to a survey from executive recruiters Sheffield.
Wage rates in NZ are on average 25% below those in Australia, the Ministry of Economic Development says.
Those with skills in demand internationally can go or stay but staying means sacrificing larger and larger amounts of pay as the prosperity gap widens.

What I call "the case for prosperity" needs to be made, and we need to debate the options for gaining more prosperity while we are still able to make changes and before they are imposed upon us.

What are we prepared to sacrifice in order to get a higher standard of living in New Zealand?

In Singapore - a country sometimes hailed as model of planned development - the father of the nation, Lee Kuan Yew, made a bargain with the people: do as you are told and I will make you prosperous.

In Holland, the Dutch realised that few people would choose to learn Dutch, and therefore if they were to trade effectively they had to learn other languages. It's compulsory to learn at least one foreign language.

I don't say that New Zealanders should give up some of their civil liberties or be made to learn another language.

But have we really agreed that the rewards of sustained growth are not worth the effort? I don't recall being given that choice in any election recently.

New Zealanders seem to have tacitly accepted that their future isn't going to be as bright as our past has been. This is dangerous nonsense.

There isn't a single problem in New Zealand that wouldn't be easier to solve if we had more money. The more frightening corollary is that our problems will be harder to solve, and our choices made more difficult, the less prosperous we are as a nation.

I am unashamed about arguing for higher rates of economic growth, for turning up the blowtorch of reform, and for challenging New Zealanders to debate how we can restore our nation to the front rank of nations.

My solution? The answer is more moral than political. People who create prosperity should be the new heroes. I don't mean the kind of artificial paper wealth that comes from smart business practices, and I certainly don't want the greedy and the mercenary to be worshiped as they were in the 1980's.

Of course we must make other changes: in taxation, regulation, welfare, education and in other areas too. My problem with focusing on those matters is that we very quickly get drawn into a partisan debate that pits one social group against another.

We ought to be able to agree on longer-term strategies that encourage savings, investment, and the development of business and social enterprise. We ought to be able to foster a culture where hard work, achievement, success and entrepreneurship are celebrated because we are all then better off.

Our sports people (and their followers) have learned the importance of "good culture" and the link to success. As a nation we need to absorb that and reflect it continuously in our lives.

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