Category Archives: Governance

Why Economists Dont Understand Education … but Still Try to Run It

This entry was posted in Education, Governance, Growth & Innovation on by .

Presentation to the NZARE conference ‘The Politics of Teacher’s Work in Aotearoa/New Zealand’, 24 August, 2002..

Keywords: Education, Governance, Growth and Innovation

Of course all economists know something anecdotally about education, insofar as they, their children and their friends went through an education system. My concern in this presentation is the deep tension between the paradigm economists practise and the paradigm educationalists practise. Indeed, an alternative title for today’s lecture might be that educationalists dont understand economics either. But being an economist I am not competent to give an account from an educationalist’s perspective. That I leave to the audience.

The New Zealand Health Reforms in Context

This entry was posted in Governance, Health, Political Economy & History on by .

Published in Applied Health Economics and Health Policy. Final version of the article.

Keywords: Governance; Health; Political Economy and History

Abstract: The New Zealand health sector reforms of the 1990s have to be seen in the context of the long term development of the New Zealand health system. The evolutionary change between 1938 and 1990 was abruptly replaced by the revolutionary policy of commercialisation from 1991 to 1993. …

Does Professionalism Matter? (NZIPA Paper)

This entry was posted in Governance, Health on by .

Paper for the AGM of the New Zealand Institute of Public Administration, 27 June 2002.

Keywords: Governance; Health

Graham Scott’s Public Sector Management in New Zealand includes a half-hearted account of the views expressed in my The Whimpering of the State: Policy Under MMP in which he says ‘Easton makes the extraordinary claim that reformers ignored, or sought to undermine, the personal responsibility and professionalism of the core public sector.’ I am not sure I went that far, but I did report Alan Schick’s concern that there appeared to be an unaddressed tension between the reform’s managerialism with its emphasis on accountability, and professionalism which emphasises responsibility.

Cutting off the King’s Head:

This entry was posted in Governance, Listener, Political Economy & History on by .

The Bill of Rights and the National Library and Archives
Listener 4 May, 2002.

Keywords Governance, Political Economy & History

While I have considerable sympathy for historian Jamie Belich’s plea to teach more New Zealand history in our schools, the Seventh Form course on the Tudors and Stuart periods is attractive, given its foundational role in the development of Westminster style governance. Or I thought it was attractive, until I learned that the study ends in 1660. …

Does Professionalism Matter? in Health and Education It Still May

This entry was posted in Education, Governance, Health, Labour Studies on by .

Listener April 20, 2002.

Keywords Education; Governance; Health; Labour Studies

In Graham Scott’s Business Roundtable published Public Sector Management in New Zealand”, the ex-Secretary of the Treasury provides an account of the late 1980s public management reforms with which he was closely involved. The book includes a few pages on critics of the reforms, including a half-hearted account of my views in The Whimpering of the State (and these columns). Scott writes, ‘Easton makes the extraordinary claim that reformers ignored, or sought to undermine, the personal responsibility and professionalism of the core public sector.’ I am not sure I went that far, but I did report American expert Alan Schick’s concern that there appeared to be an unaddressed tension between the reform’s managerialism with its emphasis on accountability, and professionalism which emphasises responsibility. Curiously (I will not write ‘extraordinarily’), Scott’s book does not provide much evidence that professionalism is a central concern, for its few mentions are desultory. There is more concern about ‘professional capture’, the danger that professionals will administer the system in their interests rather than the wider public good. (The issue echoes the corporate management/shareholder tension I wrote about in my last column Guard Dogs That Fail to Bark.)

Guard Dogs That Fail to Bark

This entry was posted in Business & Finance, Governance, Listener on by .

Management and Shareholders
Listener 6 April, 2002.

Keywords: Business & Finance; Governance

In 1932 Adolph Berle and Gardiner Means showed that there was an increasing separation between the shareholders who legally own the corporations and the managers who control it. Their seminal insight suggests that managers may have sufficient independence to pursue their own objectives – higher pay, better conditions, prestige, technological excellence – at the expense of shareholders. (The New Industrial State by J.K. Galbraith is the best know book setting out the case.) Those committed to the pure market approach responded that the shareholder can sell the shares of under-performing companies to others whose managers would produce higher shareholder returns. They described the sharemarket as the ‘market for management’, where competition would result in higher returns to shareholders, as efficient managers took over inefficient businesses.

The Treasury and the Nationbuilding State

This entry was posted in Governance, Political Economy & History on by .

Revised Paper for the 2001 Conference of the New Zealand Historical Association, December [1]

Keywords: Governance; Political Economy & History

My just published The Nationbuilders is an account of the creation and implementation of the idea of using the state to develop a nation, especially the national economy, but also in a number of other areas such as cultural policy and the environment. The story is told through a series of biographies of New Zealanders who were closely involved in nationbuilding. While I hope the book is a contribution to New Zealand biography, the book’s structure was the best way I could think of presenting the idea of nationbuilding for a general New Zealand audience. Among the alternative approaches would have been a rather dreary academic account of the origins and development of the idea, which would however have had the merit of being able to draw more directly on parallel developments in other countries. Another approach would have been to tell the story through institutions rather than people. Today’s paper is an example of this approach, for it looks at the central role of the Treasury in nationbuilding period, taking material from the book and presenting it a different way. In doing so it sharpens some of the themes, and allows the relating of the Treasury story to some the issues it faces today, reminding us that an understanding of the past can help understand the future.

A Hubris Of Managers: when Corporate Takeovers Go Bad

This entry was posted in Business & Finance, Governance, Listener on by .

Listener 17 November, 2001.

Keywords Business & Finance; Governance

Why should New Zealanders be abused when a Singapore owned company closes down its Australian operations? That is what happened when Air New Zealand shut down Ansette Australia. Yet, when the New Zealand government privatized the company in 1989, nobody mentioned that there would still be such ongoing attachments. They were certainly ignored in the 1984 Treasury paper setting out the case for privatization of all government trading activities. That paper had a very narrow focus, justifying private ownership using a theory without empirical content and ignoring the practicalities of the real world. Like that Ansette workers disregarded that it was a mainly Singapore owned airline dumping them, and picketed the New Zealand prime minister.

Low Politics: Local Government and Globalisation

This entry was posted in Globalisation & Trade, Governance, Listener on by .

Listener 13 October, 2001.

Keywords Governance, Globalisation & Trade

‘Subsidiarity’ is an ugly word. It comes from Germany where they designed their governmental institutions on the principle that decisions should always be taken at the lowest practical level in the hierarchy. It is now a central principle of the European Union, so that Brussels may not make decisions which can be left to the individual member states, just as the German Federal Republic devolves political power to its constituent Lander (states).

Something Rotten: The Ship Of State Keeps Striking Leaks.

This entry was posted in Governance, Listener on by .

Listener 18 August, 2001.

Keywords: Governance

A recent Treasury working paper Review of Evidence on Broad Outcome of Public Sector Management Regime reveals that despite the upheaval in the public sector of the last twelve years, there has been surprisingly little evaluation of the changes, and the little of which there is has not been of very high quality. Even more striking is the almost complete absence of the public’s perceptive in the evaluations. The assumption is that no-one was worse off as a result of the changes, although every ordinary member of the public has tales to the contrary. The official studies implicitly reflect an arrogant antipathy to New Zealanders, as if the state sector is only for the state servants and their political masters, and the public are just an irrelevant nuisance.

Official Channels

This entry was posted in Governance, Listener, Regulation & Taxation on by .

Broadcasting will never be just another business, whoever’s in charge.

Listener 14 April, 2001.

Keywords Governance; Taxation & Regulation.

I leave readers to recall nostalgically events from the pictures and anecdotes of Pat Day’s Voice and Vision: A History of Broadcasting (and to add the story of Aunt Daisy and the chimp). This column is about the policy process which underpins it all. There was a minister of broadcasting, and he (they were all hes) and the cabinet made decisions which affected the broadcasting system, what we heard and saw, and our nation’s culture. But there was no ministry of broadcasting, which meant that each minister was faced by a series of conflicting interest groups, which had to be sorted out without any independent advice.

The Cult Of the Manager: Those Who Can, Do; Those Who Cant, Become Managers.

This entry was posted in Governance, Listener on by .

Listener: 26 February, 2000.

Keywords: Governance;

In the past the Victoria of University of Wellington produced a useful one cardboard page calender, which set out clearly by colour coding the year’s teaching and nonteaching days, which is at the heart of the university year. The 2000 calendar is larger – so it does not fit over the archaeological layers of old calendars on the pinboard above the desk. Yet it contains less useful information. In particular the teaching/non-teaching split is not evident. Someone in management decided the old calendar was not sufficiently attractive, and got in a designer to revise it. One assumes they did not consult any academics, and isolated there in management they had no sense of what is important in a university. (The fashion for non-functional calendars seems widespread. Even Creative New Zealand succumbed.)

With a Whimper: Put Public Service Back in the Public Service

This entry was posted in Governance, Listener on by .

Listener 28 August, 1999.

Keywords: Governance;

In the opening chapter of Das Kapital, Karl Marx wrote in 1864 how recent developments in economics had “discovered the content” of value theory. His excitement is palpable, for the labour theory of value seemed to underpin his concerns of human alienation in industrial society. Unfortunately the theory does not quite work. Marx struggled with the idea, never completing Volume 3 (the text being put together from Marx’s notes). We all have brilliant ideas, which seem to solve the problems of the universe yet, as time go by, we realise are flawed. Fortunately, like Marx, we are not usually in a position to implement our faulty theories. When we are, things can go desperately wrong.

Economic Globalization and National Sovereignty

This entry was posted in Globalisation & Trade, Governance on by .

In R. Miller (ed)New Zealand Government and Politics OUP (2001) p.14-24. Written in August 1999.

Keywords: Globalisation & Trade; Governance;

In recent years there has been increasing concern that a phenomenon of economic globalization, in which the economic processes of production, finance, and exchange in each country are becoming more interdependent between countries, is undermining the sovereignty of the state. In the New Zealand of 1999 this was symbolised by APEC, one of the agencies which promotes this globalisation, albeit a minor one compared to the IMF, World Bank, and WTO (World Trading Organisation), but the government’s focusing on it as a part of its (failed) reelection strategy, because it was hosting the annual APEC conference in September 1999 in Auckland (and numerous preparatory ones before then) gave the organization an undeserved prominence. In particular there was widespread public discussion, much of it reflecting a concern, and some of it generating unrest because APEC (and more fundamentally globalisation) was seen to be against New Zealand’s interests, in contradiction to the government’s expressed belief that it was beneficial. Much of the debate, if it may be called that, from both sides was simplistic and rhetorical, missing the complexities and subtleties of the issue. Rather than provide a yea or nay, this chapter tries to set down the context, first by wading through the narrow economics, but later by opening up the topic to place the economics in the wider context of political economy.

The State Steps In: Michael Bassett Makes a Case for Intervention.

This entry was posted in Governance, Growth & Innovation, Listener, Political Economy & History on by .

Listener: 14 August, 1999.

Keywords: Governance; Growth & Innovation; Political Economy & History;

Michael Bassett’s book The State in New Zealand 1840-1984 is an assiduous, if somewhat erratic, compilation of state economic activity in New Zealand, the result of burrowing through masses of archives from government economic departments. The picture he presents, up to 1984 anyway, is that the government of New Zealand actively promoted industrial development. On more than one occasion private initiatives were failing, and the state stepped in to assist a now successful business.

Kulturkampf: Commercialisation Wars Against Arts

This entry was posted in Governance, Listener, Literature and Culture on by .

Listener: 31 July, 1999.

Keywords: Governance; Literature and Culture;

What have the following in common?

* The disappearance of the National Art Gallery;
* National Archives sued by its stakeholders in the High Court;
* The public outcry over the National Library’s proposed reorganisation.
* The National Trust under severe financial pressure;
* Te Papa confused with an amusement arcade;
* Radio New Zealand’s considering privatising its news service;
* The lack of local content on television.
* User charge threats to your local library;
* Victoria University of Wellington selling off a McCahon painting?

The Whimpering Of the State: Policy After MMP

This entry was posted in Business & Finance, Distributional Economics, Education, Governance, Health, History of Ideas, Methodology, Philosophy, Literature and Culture, Macroeconomics & Money, Political Economy & History, Regulation & Taxation, Retirement & Savings, Social Policy on by .


Auckland University Press, 1999. 269pp.

The policy process has changed dramatically following the introduction of MMP. Fascinated by the theatre of politics, we too easily ignore the major changes in policy approaches and outcomes. Today, without an assured parliamentary majority the government has to consult over its policies rather than impose them. Along with the increasing recognition that the policies of the past have failed, the policy blitzkrieg has almost ceased and commercialisation is being shelved.

The Whimpering of the State looks at the first three MMP years with the same lively, broad -ranging and informed approach as Easton’s successful The Commercialisation of New Zealand, which described the winner-takes-all regime before 1996. Again there are case studies: health, education, science, the arts, taxation. retirement policy, and infrastructure. Policy possibilities are explored. Yet, as the title of the book suggests, any releif from the ending of Rogernomics is offset be a realistic pessimism arising from a shrewd analysis of the continuing deficiencies in New Zealand’s political and social structure. Although written for the general public, this book will also be read by politicians, policy analysts and students, and will shape policy thinking in the MMP era. Publisher’s Blurb

Two Styles Of Management

This entry was posted in Governance, Health on by .

From The Whimpering of the State: Policy after MMP (Auckland University Press 1999) p.88-91.

Keywords: Governance; Health

Alan Schick argues that the central theme of the reforms was ‘influenced by two overlapping but distinctive sets of ideas, one derived from the vast literature on managerialism, the other from the frontiers of economics. Managerial reform is grounded on a simple principle: managers cannot be held responsible for results unless they have the freedom to act. The new institutional economics is grounded in a very old idea: people act in their own self-interest.’ In effect, Schick contrasted two approaches (or cultures) to public sector management. He only faintly praises accountability, but warmly describes responsibility as ‘a personal quality that comes from one’s professional ethic, a commitment to do one’s best, a sense of public service’.(1)

The Hospital Balance Sheet Crisis

This entry was posted in Governance, Health on by .

Extract from The Whimpering of the State: Policy After MMP, p.131-132.

Keywords Governance; Health

However, the CCMAU report underestimated the size of the financial problem, as became clear when the CHE accounts for the year to June 1997 were published. …

The 1996 Health Post-election Briefings

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Chapter 10 of The Whimpering of the State

Keywords: Governance; Health;

An indicator of the poor functioning of democracy in recent years is the gap of perceptions between officials making policy and the concerned public. This is nicely illustrated by contrasting the Coalition Agreement on health policy, drafted by politicians, and the post-election briefings of the three administering agencies, which the politicians did not have access to during their negotiations.[1] While this chapter provides a background for the next on health policy , its primary purpose is to illustrate the gap.