Dialogue: Anti-global stand just lazy opportunism

By STEPHEN FRANKS*

Political drivel is the best description of a recent report on the Overseas Investment Commission by Parliament's finance and expenditure select committee. It favoured a code of corporate responsibility (just for overseas investors) to be developed from sources including the so-called bad-boy legislation adopted by several states in the US.

What were the committee members talking about? Did this mean they thought the Resource Management Act and the myriad other restrictions on business did not apply to companies with overseas investors? Asking them revealed that they had no idea.

Green co-leader Rod Donald had asked for the recommendation. Government members on this committee panned the OIC for not travelling to Southland to check the effects on a community of proposed forest investment, but it neither asked for, nor got, any evidence of what the Green member meant.

Tracking down what it meant took days. Mr Donald's office arranged for CAFCA (the Campaign against Foreign Control of Aotearoa) to send material that my internet and library searches had not turned up.

Boiled down, it seems the code would say that foreign-controlled companies with a record of breaching laws elsewhere should have that held against them here. Fair enough in principle, but section 14A of the Overseas Investment Act already says that consent should not be granted to an applicant controlled by people not of good character.

So would the code direct the OIC to punish companies operating here already for offences with no connection with New Zealand? That does not seem to fit with the current drive to cut red tape. Perhaps the push for it is just political posturing.

The best explanation of the recommendation is probably lazy opportunism. The same may explain the rest of the recommendations.

To show their anti-globalisation credentials they complain about the commission. According to them it is not meeting enough, not counting carefully the jobs created by each overseas investment, not considering well enough the environmental impact of an investment and compatibility with Treaty of Waitangi obligations.

They want expanded prior reports on each individual applicant's undertakings in relation to national interest criteria and compatibility with Government policies, and then periodic reports on each investor, outlining whether they have met their undertakings.

All this means more busybody bureaucracy in the commission. But unlike usual pressures for more useless red tape, this demand is not even well meant. The MPs are cynically exploiting fears of foreign control. Sadly their remedies will increase our dependence.

Fear is well justified. New Zealand is losing control of its economic fate. We cannot afford the salaries to keep our brightest. We are reneging on defence commitments to our oldest allies because we can't pay for them. Our head offices are moving to Sydney and Singapore.

Ownership does matter. It matters desperately when head offices move overseas. With them go professional expertise and management experience, initiative and self-confidence.

Our ambitious young people see their futures where the power lies. With them go our prospects for recovery because world-leading industries emerge where world-beating people live. And crime and other social problems in our haven for state dependants turn away prospective world-beaters who might otherwise want to live in a clean, green land.

But the committee did not use its considerable powers to find reasons for the threats to what they called economic sovereignty. If it had been doing its job it would have asked how a country that has spent more than it has earned for most of the past three decades could not lose economic sovereignty. You can only spend more than you earn in two ways, by borrowing, or by selling assets. We have been doing both.

There are many things we can do to restore economic self-respect, all depending on re-learning to support ourselves. In a world where valuable people and capital can move, the Government can't protect us with hostility to the "nasty" foreigners who simply want to lend to us or build or buy the assets and businesses we don't want to pay for.

We need ministers who won't hide or excuse education failure or vow to stamp out competition. We need employment law that doesn't reward lawyers for inventing new grievances. Above all, we have to wean ourselves off laws that tell us we are victims.

* Stephen Franks is an Act list MP.