Seymour David: Address in ReplyText is incorporated into the Bound VolumeSeymour David: Address in Reply[Sitting date: 21 October 2014. Volume:701;Page:41. Text is incorporated into the Bound Volume.]DAVID SEYMOUR (Leader—ACT):I rise on behalf of the ACT Party in reply to His Excellency’s speech. I never knew I was smart until I came here. For the avoidance of doubt I am not referring to meeting the Opposition but rather to quoting a student I met at the Vanguard Military School a partnership school a kura hourua just last week. There could not have been a better entrée to my first speech in this House than meeting that student and before I return to that quote allow me to visit some of the journey to that meeting and to this House today.I represent the communities of Epsom Mt Eden Parnell and Remuera. A look at our electorate might explain why we collectively made this choice. Epsom is typecast as wealthy and that may well be true in many cases but it is certainly not universal. The largest industry in our electorate is education. Our 30 schools include many of the largest in the country. We also host one large tertiary campus and are adjacent to three more. Education is aspiration. You can tell everything you need to know about a person’s politics by acquiring their sincere answer to a simple question: “Is wealth a zero-sum game or not?”. Unfortunately the sincere answer of many in this House would be yes. They lay a litany of elaborate excuses and set about constructing an even more elaborate web of rules to reallocate finite wealth to the most deserving. In practice the most deserving means those whose special pleadings resonate loudest in the theatre of politics. My answer to the question is no. My fellow Epsom voters elected me if not in full support of my philosophy then certainly with knowledge of it.I will tell you something else about the Epsom electorate. Not only is it the most educated electorate in this country but it is also the one that had the lowest party vote for New Zealand First. Voters elected me because they understand the danger that the zero-sum brigade present to us. Our communities are leafy and our schools prestigious so if people want more Epsom then the answer is to create more Epsom more good schools and more good suburbs. But the Opposition would cram more people into smaller denser dwellings changing the character of our communities and putting intolerable pressure on burgeoning school zones.When it comes to wealth for too many the answer is higher tax rates and taxing the same dollars one more time with an envy-fuelled capital gains tax. When many of us voluntarily invest our time and talents in helping others those who think there is only so much to go around want to crowd out even those efforts for their tax-funded coercive schemes. Small wonder then that we voted the way we did.The people of Epsom did not vote for a mere abstraction or even a political strategy though. Not many if any of those who say that I am here due to the latter can say that they came to this House by way of 13000 doorsteps and delivered personally 85000 personally addressed direct mail letters had nearly 1000 attendees at private house meetings and waved signs at traffic for 300 hours. Actually most of that was done by my extraordinary team who accompanied me delivered hosted and waved. I acknowledge many of you who are here on the floor of the House and in the gallery—the people who have filled the gallery today—and those of you who could not be in Wellington. I thank you all.Those people supported me because their answer to that great political dividing question is: yes wealth is a positive-sum game. Those of us who believe that are interested in a different question: under what conditions can individuals best create wealth? The answer lies in the use of knowledge in society. Since the total inventory of that knowledge is never given in its totality to any single mind or small group of them it must be grown and applied through a widespread process of conjecture and refutation. That is the creative power of a free society; the power to try new things and find what works. This power is greatest when the role of Government is not whatever the Government defines it to be as one former Prime Minister put it but when it is clearly defined to maximise individual freedom. That definition relies heavily on an understanding of the strengths and weaknesses of government as an institution.Governments have extraordinary power to coerce legally. In some cases this power brings great goods and chief among them is an environment where we can safely go about our business in our various communities. That in turn requires the rule of law rather than the arbitrary rule of man. We meet today at the pinnacle of several centuries of progress towards that goal. We have moved towards the light of liberty by removing distinctions in law that once treated people differently depending on their religious conviction their gender or their race and most recently this House decided to remove gender from the marriage laws. Many countries have never achieved that but it is extraordinary that as if engaged in some form of historical shuttle run we who were first to touch the cone are now rushing back to create new distinctions in law. I refer to those who claim that the only way to achieve a material equality between the Māori side and the British side of my ancestry is to create more legal inequality. No doubt they have noble intentions but public policy should be measured only by results.Beyond the rule of law there are other public goods that a good Government might employ extraordinary powers to provide. Believe it or not the outcome of private action is sometimes inefficient and Government regulation can improve matters. We see this in our fisheries and our atmosphere where well-crafted regulations protect us from the ruin to which all men would otherwise rush. Insurance against genuine misfortune of birth or catastrophic events is another role that a good Government might cautiously assume. Funding but not providing education regardless of parental wealth is an example of such insurance.When used beyond these limited roles as protector regulator and insurer however a Government’s extraordinary powers corrode the powers of a free society. The problem is one of knowledge and politics. It is a fatal conceit to believe that one mind or group of minds can know enough to plan the myriad activities of the very society that they themselves are a product of. To quote Bastiat there is: “Ce qu’on voit et ce qu’on ne voit pas” but politics has a tendency to narrow human endeavour to what is visible to only a few actors. The alternative is spontaneous activity coordinated by only a few general rules and simple laws.Perhaps the most literal examples of new wealth from finite means are found in the field of engineering. I am one of two engineers in this House and I come from a family of engineers several of whom are here today. Although a generous person could barely call my own engineering achievements modest what my profession has achieved is anything but modest. Suffice it to say that when the member seated to my right gave his maiden speech phoning a person when they were not at home must have been rarer than a bow tie.The challenge is to create the conditions wherein this kind of wealth creation is likely to flourish. Thankfully nearly 200 nations have unwittingly carried out a vast natural experiment on this question. We now have several decades of data showing which public policies work and which do not. They are an adherence to low Government expenditure funded by low-rate broad-based taxes monetary policy targeted at price stability a liberal approach to trade and investment abroad flexible labour markets and secure predictable property rights. Countries that adopt these principles do not just achieve greater wealth; they also make for better environmental custodians. They also achieve greater civil liberties. Interestingly when countries are ranked according to these five measures New Zealand is consistently in the top five and often in the top three of nearly 200 countries on earth.I returned to New Zealand because it is my home and it is easily among the most prosperous pristine diverse and yet harmonious societies the world has ever seen. The desire to go back to the monocultural isolationist intolerant and interventionist New Zealand of the 1970s is forgivable only to those who were not actually there. In any case we ain’t going back.When confronted with an Opposition promising to unpick years of consensus on monetary policy tax trade and even electricity markets the people of New Zealand have said a resounding no. New Zealand today is a country that has adopted since the mid-1980s more of ACT’s market liberal policies than all but a couple of other countries in the world. To paraphrase another former member: “We won you lost.” But I am able to heartily say: enjoy this great country that has been created.Much of the credit must go to Sir Roger Douglas who is here on the floor of the House today. Roger’s reforms occurred at a unique time in our demographic history. Sir Robert Muldoon’s World War II generation gave way to the much larger generation they produced in what must have been a rather ravenous reunification after that war. In their entry to public life the boomers created a society in their image and symmetry demands that their exit will be similarly disruptive.My generation which I share with a growing number of recent entrants to this House—and I note that my speech echoes very closely the very fine speech made by Chris Bishop earlier—also faces a number of acute challenges in the wake of our parents’ reign. In the news this week and for the past decade has been housing affordability an entirely supply side entirely regulatory problem. For the first time in our egalitarian society parental assistance—not in my case I might add—has become a prominent factor in homeownership and there is a hereditary element to property. I look forward to supporting this Government’s efforts to increase the supply elasticity of housing.Fiscal sustainability should interest our generation. Treasury predicts that on historical trends Government debt will reach double GDP by the time we might think of retiring circa 2060. We can only lament the advanced auctions in stolen goods that pass for elections every 3 years and wonder how the various promises would add to this burden. With the demographic headwinds we face fiscal discipline must be a mantra of our generation.The best thing about New Zealand is our pristine natural environment. Sadly our history as environmental custodians is far from perfect but again we must think carefully about the role of Government. It is no coincidence that the countries that have been farthest down the path of Government intervention also produced the worst environmental catastrophes. Modern environmentalists should practise the four Ps: pricing property rights prosperity and private initiative. We pride ourselves on being an egalitarian society. However we must be honest with ourselves about the success of the 80-year-old promise to look after our most vulnerable citizens from the cradle to the grave. Welfare and education reform are essential to maintaining an egalitarian New Zealand for my generation.I began by quoting a student I met last week at a partnership school: “I didn’t know I was smart until I came here.” she said. Her story matters because in a global and increasingly technologically sophisticated economy the value of skills is ever increasing. We cannot afford to have smart people wasting their potential. The school she now attends does things differently from the ones she previously attended. The principal leads the school differently from the one he used to teach at. It is not pedagogy for every student but such universality does not and cannot exist in a country of nearly one million students. What matters is that it works for her. The school draws together all the strands I have spoken of today. Like all human endeavour it is imperfect but by conjecture and reputation it grows and applies the store of knowledge about educating children. The Government plays a role but a limited one. It brings the creative powers of a free society to bear upon one of our most urgent challenges as a nation.I am honoured to represent my fellow Epsom electors and to lead the ACT Party in this House. It is my hope that I will contribute here to improving public policy for all New Zealanders so that prosperous and free individuals may flourish in this green and pleasant land. Thank you.