Conor English: Marchers forget there's no free lunch

Conor English says we must support primary exporters, who maintain our standard of living. Photo / Supplied

Opinion

I went to a restaurant and had lunch last week. It wasn't free. I had to pay for it. There is no free lunch. If you haven't earned money to spend, you need to borrow it from someone who has. And they want you to pay rent for it (interest) and to pay it back. This makes it a more expensive lunch in the long run.

The geopolitical balance is being influenced by those who believe there is a free lunch and those who realise that not only is there no free lunch but tomorrow does actually come.

People across the United States, continental Europe and the United Kingdom are having to adjust to a lower standard of living. They are now having to pay for the long lunch they enjoyed over the past decade.

In New Zealand, our public debt will double over the next four years. This year we are spending about $13 billion more than we are earning. This is to knock the edges off the deepest recession we've had in more than 70 years. It is appropriate that governments operate deficits at the bottom of the business cycle. However, it is critical that the fact there is no free lunch, and tomorrow does come, is not forgotten.

It was interesting, therefore, watching four recent protests in Auckland. The first was against the idea of doing a stock take on the minerals that we have. The second was against the idea that a movie might be made in New Zealand on different terms than in some other countries. The third marched for more pay for teachers and the final was against New Zealand-produced food.

I suspect that some people support all four marches. But they need to join the dots. Some one has to earn the money. This is true of any business or household, and the country is no different.

So if you are marching for "more pay from Government", then you should not also be marching against investigating our mineral potential, our creative film sector or indeed our food sector. Right now our primary sector earns more than two-thirds of our export dollars. Every export dollar matters, which is why the US and others are trying to devalue their currencies.

But as a country we all need to do better, because governments only have three ways to get money: taxing or charging others who have earned it; selling assets or by borrowing.

So we have some choices to make. They need to be informed choices.

In this context, productive infrastructure spending is critical. Water storage and rural broadband should be the priorities because they help make the cake bigger. Roads are OK, but in our food-supply chain to international markets they form only a short part of the journey.

Rural broadband is not only the next big enabler of productivity but it is critical to the social fabric of New Zealand. But it isn't just about rural communities - it will allow our growing population to be less concentrated in Auckland, thus reducing demands on its infrastructure, taxpayers and environment.

Attitudes to growth, risk, success and sustainability matter. The Resource Management Act's four pillars - environmental, social, cultural and economic - all should be considered when making these choices. The critical issue is getting the balance right.

This year, Federated Farmers has been focused on getting the balance right with environmental sustainability, infrastructure, water (its ownership, allocation, management, quality and storage), farm succession, energy, urban-rural understanding, biosecurity, animal welfare, safe food, property rights, skills and human capability, research and depth of capital markets to name a few, and other issues that affect farms' financial viability through their impact on costs, incomes and possibilities.

New Zealand has some fantastic opportunities in the food-production and agricultural-technology space. It is one of the few areas in which we are recognised as world best. We can make a significant contribution to humanity. We should be proud of this.

But rather than celebrate and support that success and championing the exciting opportunities, we have people marching against it. They want to inhibit even the possibility of carefully harvesting just some of our resources, inhibit our film production and inhibit our food production. What's left?

If these protest groups don't want our fantastic primary exports to be allowed to pay for the country's lunch, who do they suggest will?

Conor English is chief executive of Federated Farmers.