Jones Shane: International Finance Agreements Amendment Bill — Second Reading 
Text is incorporated into the Bound Volume 
Jones Shane: International Finance Agreements Amendment Bill — Second Reading 
[Sitting date: 25 September 2012. Volume:684;Page:5627. Text is incorporated into the Bound Volume.] 
Hon SHANE JONES (Labour) 
: 
 Tena koe Mr Deputy Speaker. Let me note that I heard this evening a commentary provided by you and Mr Clayton Cosgrove about a rugby game in Dunedin. In the unlikely event that you are not made the future Speaker you may have a career in Dunedin narrating rugby. There were some fine players however in the team not the least of which was the Richie McCaw of New Zealand’s Parliamentary Rugby Team politics Mr Damien O’Connor. 
Anyhow let me come back to this bill the International Finance Agreements Amendment Bill. Labour supports this bill but beneath the words of this bill really is a debate that is gathering traction and it is a debate about monetarism. It is a debate about the orthodoxy that has prevailed in New Zealand since the mid to late 1980s. It was pushed as a consequence of Thatcherism and Reaganomics. It took root here. It found institutional expression in our Reserve Bank and it is now the subject of a very public tussle between the two teams that will lead the next Government. 
I have no compunction whatsoever unlike our colleagues from the Greens in supporting this piece of legislation because I feel you cannot pick and choose which international accords you want to commit your country to. You can take on with a level of religious fervour certain environmental accords but then sniff at things to do with financial security. So I have no compunction whatsoever in supporting this knowing yes you do rely on the Government of the day just as Winston Peters in his time intervened on our behalf and provided funding at the time of the Asian crisis back in the mid to late 1990s. 
But I want to come back to what underlies this bill. It is a debate about monetarism. A monetarist will insist that we run an austere hawk-like fiscal policy and they will insist that nothing must be done to manipulate the supply of money that might lead to a growth in the value of assets or inflation which is just too much money chasing too few goods. The other countervailing view is that from time to time pump priming—using the inflationary target and letting it float a bit—lifts a wrecked ship off a reef. So as we go forward over the next 2 or 3 years there is going to be a genuine debate. How much of the public will actually be interested in it remains to be seen but it is a legitimate intellectual demanding political debate that has gathered momentum and I salute my colleagues who have managed to get it up as an agenda item. I accept on the day of plausible deniability etc. for the Prime Minister and the deputy leader of the National Party that they have got other things to worry about but this debate is not going to go away. 
Over the last week as the IMF prepares for its annual meeting a debate has broken out between the reserve bank in Germany and the IMF. What is at the centre of that debate? What is at the centre of that debate is that the IMF has consistently said you cannot lift the wreckage of the economy and the stranded ship unless you actually take a Keynesian approach—unless you move away from this hawkish austerity and actually generate cash flow so people have got money to buy goods and services. Firms then have the confidence to invest and start to actually employ people. 
It is rather interesting that that debate at far more elevated levels than what we are talking about is gathering momentum because the IMF realises that there are risks as money is extended to countries etc. that have got in the proverbial. But without that type of intervention you cannot leave a society or an economy to implode on itself and not be surprised that more nefarious forces associated with violence mayhem terrorism drugs destruction death— 
Hon David Parker 
: Fascism communism. 
Hon SHANE JONES 
: —fascism communism and totalitarianism occupy that space. So a modern economy—and when I think about it how we have approached this bill and how we approach the role of the IMF—actually sees a large role for the private sector in any economy. For some of us it may be larger than for others; for me I see a very large role. But when you are in the midst of a long protracted period of depression—sort of basically trees dying as a consequence of actually not having enough fiscal liquid in them—you have got to intervene and one way of intervening is actually enabling the whole monetary settings to be recalibrated. And why not? No generation—just as no religion and just as no institution—can enjoy long-term life if it fossilises or it allows itself to desiccate. So that is why the debate that underlies this relatively straightforward regulatory response is a very good debate. 
It will be said from that side of the House that really what you are talking about is making New Zealanders poorer. Well I can tell you that I was chair of New Zealand’s largest fishing export company when the dollar got to US39c and US46c. We know that we probably wanted it at the 10-year average of 55c and I should imagine it is over 60-odd cents now in terms of a 10-year average but it is a fiction and it is a self-serving quite destructive approach—which unfortunately still persists in the likes of the person I like to debate with occasionally Don Brash—that we are destroying the country’s wealth. When you have these debates some lose some gain. Inflation actually helps those who want to trade assets. Inflation actually can penalise those people on fixed incomes etc. But no economy at any given point in time has all winners so the fact that we are pushing from this side of the House something that is now actually being amplified by the current leader of the IMF speaks to the prescience etc. of our two senior spokesmen not the least of whom has had the good sense to wander over and check out the thinking of senior economists and senior policy makers only to learn that it is time for change in our country. 
What can you do in maintaining growth and jobs where you are crippled by an excessively high exchange rate? What solution or what remedy is coming from the other side of the House? I will tell you what it is. It is a hawkish approach a very mean-spirited approach—I might be charitable and say for some of them a flinty approach—to shrink the size of the fiscal contribution from the Government to the economy and to society. But you can do that only so much and then the whole economy starts to wither. You can do that only if you are actually taking out of circulation funds and resources. Where is it going to come from? Because the jobs and the investment at this stage are not coming from enough firms. 
 Go and ask a firm as I did yesterday—several of them up in Marsden Point—and they will tell you: “Oh if we only had a quantity of commitment and a quality of leadership from the Government of the day many of the regions of the country would get up and get going again.” They are being crippled. They are struggling to keep ahead both of creditors and in their banking relationships at a time when the banks actually have a lot of money because the dollar is squashing confidence and squashing energy. We are right to say some parts of the country are in a depression because people are depressed. They are depressed about the absence of any hope the absence of a tone of positive stewardship from the current Government. 
So have no doubt: as we move to the next election underlying what the IMF represents is a deeper debate on what direction we are going to take our country. We are not going to take our country in the right direction while we watch ongoing unemployment the destruction of jobs and the inevitable loss of too much talent to Australia and are stuck arguing about the shibboleths that are served from the other side of the House. Some may actually understand them. Whether they believe them or not they are ideas that are no longer relevant. They are ideas that no longer generate the results that will sustain New Zealand families in a quality of life and a volume of income that makes life meaningful in Aotearoa which is why we are watching so many of them go to Australia. 
We will support this bill but in particular we support more the debate that both is overdue and will be outstanding because it will pinpoint what we as a Government in the future will do to revive the fortunes of our economy by driving the export sector. Thank you very much.