Editorial: Smart bombs and sacred cows

Opinion

Add another name to the list of this country's sacred cows - the people, institutions and subjects deemed by cheerleaders among us to be above criticism and scrutiny. That name is Rakon Ltd, a successful, just-publicly listed company that was the subject of a Weekend Herald investigation last week. The articles revealed that, despite declaring otherwise 10 months ago, Rakon had knowingly been exporting its high-tech crystals and oscillators for use in United States smart bombs for a decade. That its strategic aim is to dominate the guided munitions market in the next three to five years. We disclosed the company had worked on "radiation-hardened" products for possible use in America's nuclear defence plans and that it has been developing a G-shock crystal, for firing "out of a shell" with direct funding from its US client Rockwell Collins. All of this was set in the context of Government export restrictions on products that can be used in weapons.

The information was from internal Rakon documents which went far further than the company's claim of "full disclosure" of its work in its prospectus issued before listing on the stock exchange last month.

Since publication, the company has delicately confirmed its role in some aspects of the military work and carefully denied matters not reported in the first place. It claimed the Weekend Herald had "distorted" the documents and, of course, taken them out of context, despite not knowing the extent of the material before us.

The more savvy business people have assessed the articles and the response and taken them in their stride. But Rakon's more thin-skinned supporters and a pro-American lobby have gone much further. The paper has worn the range of hyperbole, from being anti-American to anti-success to anti-New Zealand and even pro-terrorist. The investigation's supposed crime was not that it reported truthfully from this company's own statements, internal and public. It was that it reported things that could be construed as negative to a New Zealand "success story" and that there was too much space and prominence given to the story. Two words emerged in such criticism with regularity - tall and poppy. Cheerleaders for the technology sector, including commentators who sermonise on its virtues for national salvation, took offence at warts-and-all journalism about the current tech favourite. The paper was predictably accused of publishing the articles simply to "sell more papers". Yet, as always with complex issues which need considerable length and explanation, sales of the Weekend Herald did not move much at all from the norm.

So why publish? For four reasons, united by one word: public. The full story of Rakon's military activities is undoubtedly in the public interest when assessed against the exporting restrictions. Rakon has received public funding, it is a public company. Fourth, its executives had been less than straight, and economical with the truth last August when telling the public Rakon did not know the "end-uses" of its products, when it did.

It was no surprise this week when the investing public, more fully apprised of the extent of Rakon's grip on the guided missile and military market, drove its share price up. Many have argued that guided missiles are something to be embraced, if they reduce military and civilian casualties in war. In addition, Rakon might be able to fire a smart bomb - rather than drive a truck - through the export restrictions, now under review by the Foreign Affairs Ministry, by falling back on the broad use of its products.

The disclosure of its activities and ambitions has assisted everyone's understanding on these matters. The market is more informed. The Government and officials more aware. And the tall poppy stands. It would serve no good purpose for it to morph into a sacred cow.