The Spinoff: Our alarming rates of child poverty are entirely avoidable

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The good news: child poverty rates didn’t really change in the first year of National’s policies. The bad news: child poverty rates didn’t really change in the first year of National’s policies.

Setting aside the minutiae of year-on-year shifts, statistical artefacts and political posturing (more on which later), Thursday’s data release confirms one alarming truth. As a country, we are willing to have around 12-14% of children – that is, somewhere between one in seven and one in eight – live in poverty. 

Early-years poverty has measurable, and dreadful, impacts, confirmed by survey after survey: worse health, right across the life course; worse school results; wasted talent and diminished prospects. Nonetheless, our politicians accept child poverty rates three times worse than those that affect children in other countries, or indeed pensioners in our own fair land. Our alarming rates of child poverty are entirely avoidable – and yet we continue not to avoid them.

We do so even though child poverty was doubled by Ruth Richardson in her Mother of All Budgets, and has been a subject of national concern since at least the GFC. Campaigns by NGOs last decade, amplified by Bryan Bruce’s documentaries and John Campbell’s reporting on kids’ empty lunchboxes, culminated in a 2017 election debate in which both Bill English and Jacinda Ardern pledged to lift 100,000 children out of poverty.

Ardern then passed the 2018 Child Poverty Reduction Act, one of the laws closest to her heart, and made initial inroads. The Families Package, which lifted both benefits and Working for Families payments, helped cut the number of children in families below the poverty line from around 185,000 in 2018 to 135,000 in 2022. This measure captures all the families who are living on less than half the typical household’s income – an internationally accepted measure of poverty.

Unfortunately, as is now well-worn, the cost-of-living crisis, and the failure to implement another Families Package, saw child poverty rates rise again. In the 12 months to June 2024, the last period in which Labour’s policies still held sway, child poverty was back up to around 150,000. This was still a net reduction, of around 35,000 overall – but not a very big one, and far short of the target Ardern had set herself. 

This week’s data release, which covers the 12 months to June 2025, is effectively a report on the first year of National’s policies. It shows there are still nearly 150,000 children in poverty – roughly the population of Tauranga, or enough to fill Eden Park three times over. Essentially nothing changed in that first year – on this measure.

There are, however, many different ways one can attempt to define what counts as “poor”. As well as recording families’ income, statisticians can ask them which basic items they are going without. On that measure, generally known as material hardship, Ardern again enjoyed initial success, cutting the rate from around 150,000 to 120,000. But the rate increased so much post-pandemic that, in the 12 months to June 2024, there were 160,000 children in material hardship.

In National’s first year, that rate rose still further, to nearly 170,000. Why the “material hardship” measure has followed a slightly different track to the “income poverty” one is a puzzle even to hard-core statisticians. 

Regardless, the rise in the former has allowed the government’s opponents, including Labour and the Council of Trade Unions, to claim that child poverty is worsening again – even though, on the first measure, it is essentially unchanged, and the official Statistics New Zealand verdict is that there has been no “statistically significant” shift on any of the various measures.

This politicking around the numbers is hardly unusual. When in opposition themselves, the right-wing parties cherry-picked and misrepresented data with gay abandon. The figures themselves are, in any case, subject to uncertainty, being often revised later on. And there is only so much that can be read into a single year’s data.

We should, instead, zoom out from the morass of contested statistics and ask ourselves more fundamental questions. The first is: how can we reconcile a verdict of no “statistically significant” change in child poverty with the destitution we see all around us, and with the reports of Auckland homelessness doubling under National?

For one thing, some of the data in this week’s release goes back to June 2024, and is thus nearly two years out of date. The statistics also fail to register changes in the depth of misery. A family may have slid from just below the poverty line to near-total destitution, but from the point of view of these statistics they were poor then and they are poor now.

In addition, and regardless of who is to blame, the rate of child material hardship – the number going without basic items like heating and decent clothes – has risen from around 120,000 in 2022 to 170,000 last year. We are witnessing misery that has built up over multiple years.

The second fundamental question is: what can be done about this? While a fuller answer awaits another day, we should recall that – as above – good policies can have immediate effect: the Families Package helped lift 50,000 children out of poverty in short order. And that was even though Labour’s anti-poverty strategy relied too heavily on things the government could change with the press of a button – benefit and tax-credit rates – and too little on other key policies like higher wages and cheaper housing.

Recall, too, that in countries like Denmark, child poverty rates are just 4-5% – roughly one-third of ours. Hardship rates for New Zealand’s over-65s are, similarly, just 4-5%. The latter stems, in part, from the decision to set New Zealand Superannuation at two-thirds of the average wage, a level calculated to keep most recipients out of poverty. (Albeit that relies on homeownership rates that are now declining.)

Poverty is not inevitable, in other words. Such wide variation across countries and age brackets tells us it is a matter of policy – of, in short, choice. Those who care about the issue must remind voters and politicians, in an election year, that this choice remains one of the most crucial the country faces.

The Post: Beyond the petty politics, can social investment actually succeed?

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One of the last Labour government’s strategic missteps was to basically mothball Bill English’s social investment approach.

The approach, in its ideal form, uses data to identify early interventions that could help struggling individuals – then puts families and communities in charge of how those programmes are delivered. The aim is to shift funds from under-performing schemes to better ones, tackle deep-seated social problems, and save the state money in the long run.

Sounds hard to dislike, or so you might think. Yet many on the left have a knee-jerk reaction against it.

Partly this is because social investment is a National Party creation. Partly this is because, in its first iteration under politicians like Paula Bennett, it became an excuse for kicking people off benefits as quickly as possible. And partly this is because its proponents are probably over-optimistic about how much “data” can tell us and how precisely we can ever determine whether something “works”.

Nonetheless, Labour’s decision to put social investment into suspended animation was the policy-wonk version of petty politics. But then so too was National’s decision to – in turn – scrap Jacinda Ardern’s “well-being” approach.

Despite what their respective partisans might say, the two approaches are broadly aligned. Both attempt to see individuals and families holistically, understanding that they need to flourish on multiple fronts (“domains”, in the jargon) if they are to be truly well.

Both seek to more rigorously evaluate which public schemes will support that flourishing. Both attempt to move beyond GDP as the predominant metric of success.

The petty alternation of “social investment” and “well-being” has, in short, only obstructed our collective attempt to establish how the state can more effectively spend its multi-billion-dollar social budget. Matters haven’t been helped by the furore surrounding Andrew Coster and his forced resignation as the first head of the rebooted Social Investment Agency.

Nonetheless the agency’s work ploughs on – and might even endure a change of government, whenever that occurs. While the left hasn’t fully reconciled itself to social investment, many Labour MPs at least grudgingly accept its worth. One told me they think the left “just has to do social investment better” than National does it.

What that might look like is an intriguing question. Last week I shared a stage at the New Zealand Economics Forum with Graham Scott, the head of the advisory Social Investment Board, and Rachel Enosa, who runs The Cause Collective, one of the new agencies that will commission services in the family-centric Whānau Ora scheme.

In his remarks, Scott put less emphasis on data and evaluation, and more stress on the desperate need to improve the way government delivers services to communities. Too often, the experience of people on the ground, especially in the regions, is of government agencies acting in a high-handed manner, failing to talk to each other, and delivering the services that they have predetermined families need rather than the ones those whānau might value most.

The Social Investment Agency is, instead, exploring something called community commissioning, which aims to allow local groups to come together and put in bids for pools of money that can be spent in much more flexible, community-driven ways. While not entirely without fishhooks, it’s a promising approach, one that’s consistent with Whānau Ora and potentially congenial to the left.

If there’s a problem with social investment, it’s probably the narrowness with which some view it. In my own remarks to the forum, I highlighted the ground-breaking but hugely challenging research of an American economist, Megan Stevenson, whose work assesses the latest evidence on criminal justice schemes, covering everything from employment programmes for ex-offenders through to bootcamps.

Almost nothing works, Stevenson concludes: fewer than one-quarter of US schemes can boast even one positive assessment, and those that do generally prove impossible to replicate outside their initial context. Stevenson thinks the underlying problem is the search for the “cascade”: the cheap but sensationally effective programme that, by fixing one part of a person’s situation, sets off a chain of improvements that forever alters their life course.

These “cascades” are “mostly a myth”, Stevenson writes, because struggling individuals are invariably embedded in dysfunctional social contexts, living in neighbourhoods weighed down by poverty, racism, poor health and limited opportunities for work. Until those “negative stabilisers” are addressed, any small-scale state initiative is liable to be overwhelmed.

Nor is this conclusion surprising when we consider our own national history. The initiatives that really changed lives in the 19th and 20th centuries, lifting lifespans and well-being in a broad-based manner, were the big, sweeping, universal or quasi-universal state schemes: free education, free hospital care, the social welfare safety net.

Such schemes are, of course, a form of “social investment”; I’m told the Scandinavians have long used the term to describe precisely these big-picture programmes. But is our own version of social investment capacious enough to reflect this reality? That’s the multi-billion-dollar question.

The Conversation: Racing enjoys special treatment under NZ gambling laws. Why?

Read the original article, co-written with Lisa Marriott, on the Conversation

Despite the harm it is known to cause to a significant number of New Zealanders, the gambling industry as a whole is commonly defended for its contribution back to the community.

Lotto NZ, for example, must redistribute all profits from Lotto in this way. Other forms of gambling are taxed or regulated differently, but most pay back a share of their profits in some form.

Critics counter that such redistribution of gambling revenue does not fully address the harmful effects of problem gambling, or the fact that gambling itself isn’t distributed evenly across society.

So, while 63% of electronic gambling machines – colloquially known as “pokies” – are located in areas of relatively high deprivation, just 12% of the proceeds from those machines go to those areas.

But the racing industry is permitted to return almost all its profits back to the industry itself. In fact, the sector – covering horse racing and, until recently, greyhound racing – benefits from unique treatment.

The Gambling Act 2003 requires some minimum percentage of gambling proceeds to be returned to community organisations or other “authorised purposes”.

But it also states that one of those “authorised purposes” is “promoting, controlling, and conducting race meetings under the Racing Industry Act 2020, including the payment of stakes”.

The racing industry is the only sector with a specific provision in the act allowing it to return gambling proceeds to its own industry. This extends to most profits from electronic gaming machines located in TAB premises.

Of all the forms of gambling, electronic gaming machines are generally recognised as generating the most harm.

In 2025, the TAB’s monopoly on domestic, in-person betting on racing and sports was extended to cover online betting. This was intended to “maximise the financial returns to New Zealand’s racing industry and sports”.

Typically, industries that cause harm are regulated in an attempt to minimise that harm. But the racing sector, via the TAB, is now largely self-regulating.

Although a Racing Integrity Board regulates issues such as animal welfare, recent changes to the Racing Industry Act empowered horse and greyhound racers “to effectively govern their respective industries” and is “intended to provide the industry with independence from the Government”.

The racing industry also does not pay income tax. Like other gambling entities, it does pay a problem gambling levy – in its case, 0.74% of betting profits or 1.24% of profits from gaming machines located in TAB outlets.

Other gaming attracts additional levies: Lotto faces a 5.5% lotteries duty, casino operators pay a duty worth 4% of casino wins, and the levy on gaming machine profits is 20% (also paid by the TAB on machines in TAB premises).

But the racing sector no longer has to pay such additional levies on racing. Until recently, a 4% “totalisator duty” was payable on all racing and sports betting, but this was repealed progressively to reach zero in 2021.

The savings to the two betting categories from repealing the duty was NZ$14.5 million in 2024, of which $11.5 million went to racing.

This saving for the industry is, of course, a direct cost to the Crown in the form of foregone tax revenues.

The justification for the repeal was to help the racing industry become more financially self-sufficient. But levies and taxes are usually based on the nature of an activity – in particular, the harms it causes – and not the level of profit (or loss) it makes.

Under the Racing Industry (Distribution from Betting Profits) Regulations 2021, the TAB must retain just 2.5% of betting profits for harm prevention and minimisation.

The remainder is distributed to Racing New Zealand and Sports and Recreation New Zealand, in proportion to the revenues generated by racing or sports betting.

In practice, this means most distributions accrue to the racing sector. For example, total distributions of racing and sports betting profits in 2024 were around $199 million, of which $195 million (98%) went to racing and $3.5 million (2%) went to community sports organisations.

For decades, ministers of racing have gone to great lengths to protect the industry. In the runup to the TAB getting its monopoly over online betting in 2025, official documents noted that “Ministerial expectations” were one of the reasons the changes must be “implemented as quickly as possible”.

Government support for the racing sector is often justified by claims of improved employment opportunities, benefits to provincial communities and increases in the industry’s overall economic contribution.

But these arguments could be made for most industries in New Zealand – industries that do not generate the harms gambling does. State support for the racing sector generally means there will be more gambling on racing. That in turn implies increased harm from gambling.

We argue it’s time for a wholesale review of the tax and regulatory privileges that have accrued to this industry without any convincing rationale.

The Spinoff: The iwi-run savings scheme giving Ngai Tahu kids a kick-start

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Although it was two decades ago, Lisa Tumahai still remembers the day she got her plastic Whai Rawa card in the mail. “That was quite exciting, and a proud moment,” she says. 

Back in 2006, Whai Rawa was something new to this country: an iwi-run savings scheme. Its origins lay in discussions within Ngāi Tahu about how to use the $170 million from their landmark 1998 treaty settlement.

Tumahai, who had been elected to the board of Te Rūnanga o Ngāi Tahu in 2003, says Whai Rawa owes much to Tahu Potiki, the rūnanga’s chief executive at the time, and former retirement commissioner Diana Crossan, who had been working on tertiary education savings initiatives. 

Whai Rawa is, in essence, a reciprocal wealth-building scheme for Ngāi Tahu members of all ages. For adults, the iwi matches any savings they make dollar for dollar, up to $200 a year. But there’s a particular focus on children, who can be enrolled in the scheme at birth. Then, for every dollar that individuals deposit in the child’s account, the iwi contributes $4 – again up to $200 a year. Children registered before their first birthday also get a $100 kick-start. Members can then withdraw their savings for three wealth-related purposes – tertiary education, home-ownership, and retirement income – as well as in cases of hardship and serious illness.

Tumahai, who went on to chair the Ngāi Tahu board from 2016 to 2023, says Whai Rawa has become “a flagship initiative for the tribe”. Now in its 20th year, it has more than 38,000 members with $200m saved. Some $49 million has already been withdrawn for first-home purchases and the like.

The reciprocal savings partnership is crucial, Tumahai says. It ensures members are connected to Ngāi Tahu, not just “accepting a cheque in the mail”, she adds. “When you have reciprocity, you feel a great level of ownership … and pride.”

Some iwi members might prefer to be directly distributed their share of Ngāi Tahu’s wealth. “[But] I think there are enough schemes in New Zealand, creating enough beneficiaries, that we as a tribe shouldn’t go down that pathway.” Affordability can also be an issue. “I always get a lot of people saying to me, ‘I can’t afford it.’ I think we can all afford $50 a year.” People’s immediate welfare needs, she adds, can be met by the social services provided by Ngāi Tahu’s 18 rūnanga.

Whai Rawa has been “a huge success, in my eyes”, Tumahai says. Her only regret is that fewer than half the iwi’s 85,000 members have signed up. “I would really have liked to think we would be up around 60% by now.” 

That figure is also on the mind of Renata Davis, a current Whai Rawa board member. Some whānau, he notes, face “intergenerational barriers” to participating in any savings scheme. They may be disconnected from the iwi, or “disaffected” with financial services more generally.

In response, Ngāi Tahu is increasing its communications with iwi members, “trying to provide more of a helping hand than other institutions”, and seeking to lift membership. Sign-up rates for newer, younger members are higher than for older ones, Davis says: half the scheme’s members are under 25.

The scheme’s appeal is partly about “building the matauranga of our tamariki – learning about those [financial] concepts from a young age”. People used to focus on “money in the bank for a rainy day”, he says. “Now, everyone is a little bit more financial – investing in equities and all these types of instruments. This [Whai Rawa] is a doorway into that world for our whānau members.”

As well as boosting individual savings, the scheme has “huge flow-on effects” for the iwi as a whole, Davis says. Being financially secure gives people “freedom and options” about how they use their time – and the ability to contribute more of it to their iwi.

Whai Rawa’s current general manager, Sam Kellar, says the scheme is “trying to build intergenerational wealth”, consistent with a long-term Māori worldview. The iwi “wanted to give our people … a middle-class lifestyle”, lifting aspirations for tertiary education and other achievements.

Whai Rawa is a rare place of work “where we celebrate money going out the door”, Kellar adds. “Success is measured by members going to university, or withdrawing money for their first whare, or retiring a bit more comfortably.” 

Kellar says “quite a few” members have made withdrawals for both tertiary education and first home purchases. The scheme hasn’t yet hit the “trifecta” of someone making withdrawals for those two purposes and retirement as well. “But we’ll definitely celebrate that when we get there.”

One of the questions facing Whai Rawa’s managers is what makes their investments distinctively indigenous. In some respects, they have to conform to standard western financial practices. Kellar notes that the scheme is “very regulated”, being subject to anti-money-laundering scrutiny, the need for an Inland Revenue number for membership, and related strictures. 

Davis, for his part, notes that some Māori see financial investments as “risky, and inconsistent with te ao Māori values”. But Ngāi Tahu covers the scheme’s administration fees on members’ behalf, and uses only “responsible” funds, run by investment experts Mercer, that have divested from weapons, tobacco and companies that make more than 15% of their revenue from fossil fuels. (Ngāi Tahu wasn’t able to immediately say how much of the scheme is invested domestically.)

The ability to withdraw funds for retirement at 55, recognising lower Māori life expectancy, is also a point of difference. But, Davis says, the “distinctiveness” question is “something we need to continually check in with ourselves about, and make sure we are putting our money where our mouth is. We don’t want to be iwi-washing.”

The Whai Rawa board, he adds, is currently carrying out a “where to from here?” assessment. In future, the scheme could offer withdrawals for tangihanga, and make it easier for members to develop papakāinga and build on Māori land.

The scheme’s managers are also considering whether they should take a more “customised” approach and allocate funds to specific areas, Kellar says. They could even create “a financial services ecosystem” in which the iwi provided KiwiSaver, insurance, debt consolidation, financial advice and other “banking-type products”. 

Whatever the future holds, Whai Rawa’s position appears secure. Tumahai certainly remains a fan, having been a contributor to the scheme “ever since it opened” and depositing money into both her children’s and grandchildren’s accounts. Whai Rawa, she says, “has become part of our identity”.

The Post: Hypocrisy at heart of how New Zealand treats the unemployed

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Necessary, but disliked: the way that unemployed people are regarded in this country, especially by centre-right politicians, continues to be a paradox.

This truth sprang to mind on Wednesday, when Statistics New Zealand revealed that unemployment had risen again, hitting 5.4% last December. Around 40,000 people have lost their jobs under this government.

To qualify as unemployed, one must first be actively looking for work. And it is precisely this subtlety that reveals the depths of this Government’s mismanagement. As Ganesh Nana, a former Productivity Commission chairperson, pointed out this week, people are so discouraged by National’s economy that over 80,000 have taken themselves out of job-hunting entirely.

If New Zealanders were still seeking work with the same enthusiasm they had two years ago, the official unemployment rate would now be 6.3%. And it’d be higher still if thousands of Kiwis hadn’t left for Australia.

The unemployment rate there is just 4.3%, and it’s lower yet in many developed countries. Our Government can’t blame its woes on global conditions, difficult though the latter are.

Meanwhile, our “underutilisation” rate – which includes not just the unemployed, but also people who need more hours of work – is 13%, and Māori unemployment is twice that of Pākehā. We are profoundly failing to make the most of this country’s ample talent.

This is not entirely an accident, however. For the last 40 years, economic policy has abandoned the idea of maximising employment, instead engineering joblessness as a means of restraining inflation.

Our current situation derives from the Reserve Bank’s having only one tool to curb price rises: a hike in interest rates, which hamstrings business investment and leads to mass redundancies. More generally, and among centre-right politicians in particular, it has long been thought useful to have a reasonably large body of unemployed people.

This generates ample competition for new positions, keeping wages down, and also probably discourages those in work from demanding pay rises, lest their employer find a way to replace them with someone from this reserve army of labour. This is not a conspiracy theory but a concept embedded in orthodox measures such as the Nairu, the non-accelerating-inflation rate of unemployment, which holds that too much employment leads to intolerable price rises.

This approach is doubtful at the best of times, but appears downright hypocritical when one considers how centre-right governments treat the unemployed. If it is necessary, on this view, to maintain a reasonably high level of unemployment, the obvious implication is that unemployed people are playing an essential role – a structural function – in the economy.

One might think, then, that those unemployed people would be treated well, their sacrifice noted and rewarded, by centre-right governments. Quite the contrary.

Despite significant increases under the last Labour Government, the core unemployment benefit, Jobseeker Support, is just $360 a week for a single adult, who might get another $100 a week in Accommodation Supplement. Given rents are still sky-high, this person could easily be left with under $200 a week to pay equally extortionate power, grocery and other bills.

It’s not much of a life. It’s now how you treat someone you respect. And National has no plans to improve it.

Indeed our “wealthy and sorted” prime minister once infamously described struggling New Zealanders as“bottom feeders”. In online comments sections, right-wingers often disparage the unemployed in similar terms.

In their defence, centre-right politicians sometimes claim that, although a brief bout of joblessness is a necessary evil, they don’t want anyone to be long-term unemployed. But this is something of a fantasy: in September 2025, for instance, over 20,000 people had been unemployed for over a year.

And even short-term job loss can leave deep scars. Motu research has found that New Zealanders made redundant are, five years later, earning up to one-fifth less than their peers.

The wider solution, surely, is to invest more in training and work-readiness initiatives for the unemployed, so that when jobs do become available, people can move into them as quickly as possible. The average developed country spends twice as much as New Zealand does on such schemes.

Underlying such investments would be a political commitment to keeping unemployment as low as is feasible – perhaps just 2-3%, virtually all of it short-term, with long-term joblessness all but eliminated. Any inflationary pressures could be handled by giving state agencies a wider range of tools to curb price rises.

And for the – hopefully brief – period that people spent out of work, we could ensure their income was sufficient to allow them to live with dignity. Research suggests that in countries that combine strong work-readiness investments with higher benefits, people spend less time on welfare than they do in countries with weaker skills programmes and lower benefits.

A different system, in short, would benefit us all – and represent a less hypocritical way to treat people whose position is often a function not of individual choice but of economic forces.

The Spinoff: Doing more with what we already have: a challenge to the abundance agenda

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A surprise bestseller last year, Ezra Klein and Derek Thompson’s book Abundance won converts the world over with its vision of a better life attained through building more stuff. The key to tackling climate change, the cost of living and other crises, Klein and Thompson argued, was to sweep away bureaucratic obstacles, embrace a growth mindset, and construct copious amounts of houses and windfarms.

Closer to home, The Spinoff recently anointed housing minister Chris Bishop the king of “abundance” politicians for his pro-growth reforms. A study published on Monday, however, suggests we should also be pursuing a far less sexy approach: doing more with what we already have.

The study, commissioned by the Energy Efficiency and Conservation Authority, shows that simply by changing the times at which we use electricity, we could avoid $3 billion in spending that would otherwise be needed for new energy generation and network infrastructure. Such infrastructure is often designed to provide extra capacity at peak times. But if we adopted practical, ready-to-implement measures to shift demand away from the peak – battery storage, for instance, or mechanisms that change the times at which dishwashers run – we could avoid those costs.

This proposal would have immediate environmental benefits because the energy supplied during peak periods is often the dirtiest, and because it accounts for renewable energy’s intermittency. But it also poses a wider challenge to the abundance agenda.

The book Abundance has proved popular for several reasons: it has a very simple formula, it encapsulates younger generations’ frustrations with the current system, and – crucially – it promises us that a better world can be achieved with essentially no personal sacrifice. A startling flaw in the book’s case, however, is that it never even attempts to prove that this is possible – that, in other words, we can build our way out of things like the climate crisis.

Any building process, after all, starts with digging the raw materials out of the ground, often at substantial environmental cost. The construction phase can likewise be damaging to delicate wetlands and the habitats of endangered species: hence so many projects get knocked back. 

Funds for new infrastructure are increasingly under strain, as governments face rising healthcare costs and maintenance bills for existing hospitals and power plants. And then there’s the irony that we generate emissions even when building the infrastructure designed to reduce them.

Concrete production alone comprises around 8% of the world’s carbon pollution. Even if one assumes, somewhat heroically, that the carbon used to produce each kilogram of concrete could rapidly be halved, this gain would be completely wiped out by a doubling of concrete production. (And it’s worth remembering that, every two years, China consumes more cement than the US did in a century.)

Such points could be mobilised to serve bad-faith arguments that we should not, for instance, build more houses because of steel and concrete’s embodied carbon. In reality, we need more homes, hence the welcome upzoning of recent years, itself a prefiguration of the abundance agenda. The wider difficulties inherent in building our way out of climate change should, however, give us pause for thought.

For instance, three-quarters of the world’s energy currently comes from fossil fuels. The recent growth in renewable generation is, admittedly, one of our age’s great success stories. Last year, wind and solar farms generated more electricity than coal plants for the first time – and at a rapidly diminishing cost. But is it really conceivable that we can build so much renewable energy that it rapidly replaces almost all fossil fuels, and keeps up with population growth, and meets increased expectations of affluence, while also restoring nature and reducing emissions at the pace the planet demands?

It would, of course, be wonderful if that were true. And the abundance agenda is – it bears repeating – not entirely wrong. Building more homes in city centres, for instance, enables a future of far fewer work commutes, and thus lower emissions. But many of the other innovations designed to deliver us a sacrifice-free but environmentally sustainable economy, such as greener aviation fuels and carbon capture and storage, have failed to produce anything meaningful, and look utterly insufficient in a world where we need to halve emissions by 2030. EVs, meanwhile, are splendid, but replace perhaps 70% of a petrol-fuelled car’s lifetime emissions, not 100%.

We should, at the very least, be placing far more emphasis on exploring whether we can get more out of what we already have. It’s not just peak electricity demand: we might, for instance, avoid the need for a new $4 billion tunnel through Wellington if we could spread out the morning and evening peaks in traffic, through congestion charging, working from home and staggered workday start times. (Better options for cycling, walking and public transport – which, in fairness, Klein and Thompson advocate – are also essential.) It’s unclear if that plan would work – but it should at least be properly explored.

Some years back, Britain’s energy ministry calculated that if everyone boiled only the water they needed for their cup of tea rather than filling the jug, the country could mothball an entire power plant. Equivalent New Zealand calculations are frustratingly hard to find, but we are surely passing up similar opportunities.

Abundance’s boosters would argue that this alternative approach, and indeed anything that involves living more lightly on the earth, relies on heroic assumptions about the sacrifices individuals are willing to make. But this is not a matter of sweeping lifestyle change, just relatively simple things, like switching the times at which we use electricity. To take another example, smart appliances and the like held electricity demand constant throughout much of our last decade. The potential for further innovation is undoubtedly there.

Think of it this way: surely the only logical approach in life is to establish what more one can extract from a given thing, before one goes out and builds a new one. This does not mean abandoning abundance entirely. At least at the level of vibes, its agenda is useful: we should certainly face the future with as much optimism as possible. But building new things is certainly not the only path forward.

The Post: This week’s floods show why we need to talk about climate change - and keep talking

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The most dangerous way to deal with this week’s North Island floods would be to treat them as a one-off event. They are, in fact, an emblem of the damage we do by burning fossil fuels. This is the core truth, and as the floodwaters recede, it must be broadcast again and again, if the public is to be stirred into tackling climate change with the urgency it deserves.

Many readers will have sensed something wearily familiar in this week’s news reports. There have been 20 “red” weather alerts since the Met Service introduced that warning label – the toughest in its arsenal – in 2019. Combined, these alerts recount a tale of accelerating damage.

Flooding hit Southland in early 2020, then Canterbury in 2021, sparking local states of emergency. In 2022, Cyclone Dovi brought record rainfall to the North Island, closing State Highway 1. Later that year, floods caused widespread damage in both Gisborne and Nelson.

Few people have forgotten 2023’s devastating Auckland Anniversary floods, or the destruction later wrought on the East Coast by Cyclone Gabrielle. Then there was 2024’s flooding in Otago, a repeat of the Top of the South floods in 2025, and severe storms elsewhere across the country last year.

Such storms have always occurred, of course, but as the scientist Kevin Trenberth points out, climate change makes them much worse: more common and more extreme. Burning fossil fuels heats the globe. And in that warmer world, extra moisture evaporates from bodies of water, building up in the atmosphere and loading storms with ever-greater power.

At other times, conversely, excess heat dries out the land, leading to more droughts. We now spend less time in typical, “healthy” weather, and more time in the extremes of wet and dry.

This will only worsen. In the words of Hayley Fowler, a Newcastle University climate scientist: “This is the least extreme climate you will experience in your lifetime.” Other scientists have calculated that climate change already costs the globe $16 million an hour in extra floods, hurricanes and heatwaves, a bill that could rise to $3.1 trillion annually by 2050.

These facts are not stated often enough. Scour media reports of this week’s floods, or previous extreme weather events, and you will find few mentions of climate change.

Reporters on the ground are understandably focused on getting first-hand interviews and visuals. In this polarised age, editors are also mindful of not being seen to push an ideological stance.

But the link between climate change and increasingly severe weather events, far from being a political statement, is simply the scientific consensus. If citizens are to properly understand the forces behind everyday phenomena, that link needs to be made clearer in reporting, especially when it has an analytical component.

Our politicians should also be making this connection more often. The reason this matters so much is that so little else seems to capture public attention.

The dire consequences of a warming world, some decades hence, remain remote to many people. By contrast, the increasing ferocity of current weather, and the damage it does to lives, livelihoods and property, is immediately tangible, and impossible to deny.

This week’s events should be used to put pressure on a Government that is failing calamitously on carbon reduction. Its plan for 2026-30 leaves us 84 million tonnes short of our official target, an amount equivalent to more than one year’s emissions.

Pointing out that this failure will contribute to more floods and droughts does not amount to exploiting a crisis; it is simply telling the truth. Of course our total emissions are small in the global context, but they are among the highest on a per-person basis.

We also face a moral responsibility to shoulder our share of the burden rather than lag behind the best performers, as we currently do. And if we shirk our responsibilities, we encourage others to do likewise.

Yet although the climate may never improve, we can help ensure it does not greatly worsen. We can limit, too, the harm done to the poorest households, who are likely to be most affected by climate change despite having done the least to cause it.

According to the World Inequality Database, someone in the highest-earning tenth of New Zealanders has a carbon footprint three times that of the average Kiwi. Even worse are the hyper-wealthy 0.1% with their heavily polluting super-yachts and private jets.

This is not to let everyone else off the hook. We can all live more environmentally sustainable lives, and collectively rewire our energy, transport and housing systems.

But the pictures we see of this week’s catastrophic floods are pictures of ordinary people, many of them not especially well-off, bearing the consequences of a situation created disproportionately by the affluent. That is not a comfortable conversation for many New Zealanders – but it is the conversation we need to have.

The Post: How better modelling could fix economic blind spots

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Sometimes it takes a Queen to raise the tough questions. After the catastrophic 2008 global financial crisis (GFC), Elizabeth II asked British economists, with unusual bluntness: “Why did nobody see it coming?”

Among many other causes, including greed, hubris and free-market ideology, one reason for the blindness was simple: economists’ models flopped. Just before the crisis, America’s Federal Reserve modelled what would happen if US house prices fell by one-fifth, and concluded, “Not much.” In the event, as the effects of a 23% house-price collapse rippled around the globe, millions of people lost their jobs and the American economy alone took a $10 trillion hit.

These issues are aired in a book I read over the break, Making Sense of Chaos, by the pioneering complexity economist J Doyne Farmer, a colourful, bearded American whose research spans multiple domains and whose CV includes stints building computer systems to beat casinos at roulette and outperform the stock market.

Post-GFC, conventional economics has had many antagonists, especially on the left, but too often they have been outsiders decrying economics as nonsense, possibly even evil, certainly to be ignored. Farmer, as a sceptical insider, is far better placed to explain where it has gone wrong, and recommend improvements.

His overarching argument is that economists’ assumptions about human behaviour have generally been both too simplistic, modelling people as self-centred consumers with perfect foresight, and too individualistic, failing to account for the way that our actions intensify and exacerbate each other.

So far, so predictable, for anyone who has been reading the critiques of the last few decades. Where Farmer excels, however, is in explaining why economics fell into error – and it was mostly, he thinks, due to a lack of computer power.

The core assumptions – that people generally maximise their own happiness, predict the future perfectly, and reach “equilibrium” states in which the needs of sellers and buyers line up – were required to make economists’ mathematical equations solvable using pen and paper. Introducing more variables would have rendered the calculations impossible.

Fortunately, we can now replace these mathematical equations and hypothetical individuals, this attempt to predict the future using top-down abstractions, with a much more real-world-focused, ground-up approach based on big data and massive computational power.

Drawing on recent advances in both the latter categories, Farmer has spent much of this century helping pioneer a method called agent-based modelling, in which data about the decision-making of actual people are used to make models in which hundreds of thousands of realistic individuals (“agents”) interact with each other. Modern supercomputers then run repeated simulations of all this interaction, producing predictions of increasing accuracy.

When the Covid-19 pandemic hit Britain, for instance, Farmer’s team at Oxford University modelled its likely economic impact with startling precision, forecasting a fall in GDP of 21.5% against an actual contraction of 22.1%. One crucial advantage of their approach was that it captured what are known as the “emergent” qualities of an economic system: the dynamics that arise only when individuals interact with each other and which cannot be predicted by taking each person in isolation.

As Farmer acknowledges, ordinary people would probably have assumed that this is how economic modelling has always been done. It is this method that has given us weather forecasts of ever-increasing accuracy. And economics is slowly catching up.

Many of the world’s central banks, the equivalents of our Reserve Bank, have begun using agent-based models to better predict economic trends. Farmer’s modelling for the Bank of England helped show that debt-to-income limits – now used here and elsewhere to curb excessive mortgage lending – drastically reduce the likelihood of future housing bubbles.

Such modelling could also help fight climate change. Conventional economic models, Farmer argues, have typically overestimated the cost of reducing emissions and underestimated the benefits.

His team’s modelling suggests the green transition will actually save the world around $12 trillion compared to business as usual, partly because renewables are becoming so much cheaper than fossil fuels. And because scaling-up production generates opportunities for learning-by-doing and further innovation, a faster transition saves more money than a slower one. These results provide powerful support for a rapid economic shift.

Encouragingly, when Farmer gave a webinar to our Treasury last year, many of the participants were enthusiastic about his approach, even if they did point to local data gaps that could hinder its implementation. The Treasury also has in-house expertise in this area.

Better modelling won’t, of course, change the world by itself. Many of our economic problems are at heart political: we tolerate gaping income disparities because we think poor people are lazy, and disastrously high emissions because we’re careless about the natural world.

Nonetheless I found Farmer’s book to be a small ray of hope – a sign that science continues to advance, that policies will slowly improve, and that we can come to better understand our present and, with it, our future.

The Spinoff: When Chlöe met Corbyn – and Varoufakis and Piketty and Polanski and Mazzucato and…

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It was, one of her Instagram followers declared, “a tour of legends”. Another described it as “a full bingo card”. And it does look as if, on her recent European trip, Chlöe Swarbrick met everyone there is to meet on the political and intellectual left.

The list of figures the Greens co-leader encountered during two weeks in September was imposing. Former Labour leader Jeremy Corbyn. Newly appointed UK Greens leader Zack Polanski. Mariana Mazzucato, one of the world’s most-cited economists. Fellow economic superstar Thomas Piketty and his wealth-tax offsider Gabriel Zucman. YouTube sensation Gary Stevenson of Gary’s Economics. Manon Aubry, the leader of the European Parliament’s Left bloc. Economist, ex-politician and left-wing idol Yanis Varoufakis. Guardian columnist George Monbiot. Influential economist Daniela Gabor. And plenty more.

Although primarily in Europe to attend an insurance conference, Swarbrick seized the opportunity to meet these leading figures – and think about how to apply their insights back home. She arrived at a “pretty crazy” time, she tells me when we meet at parliament: 100,000 British far-right supporters were mounting anti-immigration protests, the latest UK left-wing political venture, Your Party, was descending into internecine warfare, and Zucman’s wealth-tax proposals were being bitterly attacked by France’s richest man, Bernard Arnault.

Swarbrick’s encounters covered a vast intellectual terrain, taking in “technofeudalism” with Varoufakis, state capacity with Mazzucato, the carbon transition with Gabor, and wealth taxes with, well, pretty much everyone. Front of mind was the growing evidence that widened material disparities – and the resulting economic insecurity – are the key driver of the public’s growing disenchantment with political institutions. “Pretty much everybody was talking about that interconnection between inequality and democratic decay.” And, consequently, the need to give ordinary people greater control over their economic situation. “Democratising the economy was a very strong thread of all of that [discussion].”

One of her key meetings was with Polanski, a self-described eco-populist who, since becoming leader of Britain’s Greens, has nearly doubled the party’s polling (from 8% to 15%) and membership (from 65,000 to 120,000). The “phenomenal” Polanski, Swarbrick says, has realised that “you cannot get people to care about the end of the world … if they cannot afford to put food on the table at the end of the week”. (Polanski, meanwhile, has returned Swarbrick’s approval, telling the Guardian that she is the living person he most admires, someone “demonstrating the bold leadership that I look to do every single day”.)

Another highlight of her trip came from meeting Mazzucato, who has been hired by multiple countries wanting to know more about her idea that governments should pick national “missions” to drive economic development. The Italian-American economist’s key insight, Swarbrick says, was the need to break the intellectual “deadlock” in which “the right are going ‘Shred the bureaucracy,’ and then the supposedly left-wing argument is, ‘We will keep the bureaucracy.’” The bigger question, as Mazzucato puts it, is, “What is the function of the bureaucracy?” While Swarbrick’s discussions with Mazzucato, Gabor and others took in specific policy ideas (national investment banks, for instance), all were adamant, she says, about the more general need to rebuild state capacity after decades of disrepair.

It wouldn’t, of course, be a Swarbrick trip without at least one “really nerdy breakthrough”, which came courtesy of Piketty, whose 2014 book Capital in the Twenty-First Century restored wealth disparities to their central place in political debate. As much a data nerd as the “economic rock star” he is sometimes labelled, Piketty somehow knew that New Zealand councils levy rates. He pointed out, Swarbrick says, that this means New Zealanders “actually do have exposure to a wealth tax … and isn’t it unfair that that applies only to property and not to financial assets?” That sparked a “hah!” moment in which Swarbrick asked herself, “Why have we not talked about it from this perspective?”

Her meeting with Varoufakis, at one point the intellectual “poster boy” for the European left, was equally memorable. Is he, I ask, as intense as everyone thinks? “Yes,” says Swarbrick, laughing heartily. “He is. But it was honestly really, really cool.” The two talked about the banking system, the military-industrial complex, and potential new forms of international relations. That said, he didn’t appear to her as an oracle, Greek origins notwithstanding. With all these figures “who I have admired for a long time”, Swarbrick says, “you’re sitting in front of them and [you realise] it’s just guys, you know? At the end of the day, we’re all just guys – just people – trying our best!”

Earlier in the interview, she had said, bluntly: “Nobody has all the answers.” And this was her point about Varoufakis – and indeed the other economists she met. Each of them “was able to answer with a huge amount of detail on their specific areas of expertise. But when I would ask them about the crossover and the cross-pollination and what the new economic paradigm looks like, they said that they didn’t feel comfortable, necessarily, to give that answer … They could answer for their part in that, but not necessarily the whole.”

If, in short, Swarbrick had hoped to be handed an economic blueprint, she would have been disappointed. Instagram clips from her encounter with Polanski show him acknowledging she has “a better answer” than he does on the global economy, while her appearance on Gary’s Economics starts with Stevenson asking her for advice about “how to influence [the] politics” of wealth taxes.

Did she, I ask, travel to Europe hoping to be schooled by its political leaders and instead end up schooling them? Swarbrick laughs uproariously, then sensibly pivots to talking about the task ahead. As she sees it, some 40 years after the advent of the market-fundamentalist, hyper-individualist ideology sometimes known as neoliberalism, a new overarching left-wing narrative remains to be written. “We are very much now in a place [where] we have to build the new house we want to move into. And we know what some of the foundations and some of those building blocks look like. But there are a lot of decisions we have to make about design.”

And for all that the figures Swarbrick met on her trip were left-wing heroes, they were also united by another characteristic: none had ever won power. (Except Varoufakis, who was part of the Greek government in 2015 – but even he was famously unenthused by the experience, jumping ship after just six months.) Does it worry Swarbrick that she didn’t meet any outright electoral winners? She laughs again, and says: “I think nobody so far has done what we want to do.”

She was, however, heartened by hanging out with Stevenson in London and “just watching regular people come up to him and be like, ‘Tax wealth!’, and for that to be such a normalised conversation in the UK.” Meanwhile, Piketty and Zucman were “feeling good” despite – or perhaps because of – being assailed by the French elite. “They understand that having entrenched power attack you, because you are speaking truth to that power, provides you with a platform. And if you can stand calmly in that space, can continue to hold that mirror up and speak that truth, then that cuts through in a way that resonates with people.”

For all that, the forces currently taking power across Europe come from the far right, not the radical left. But Swarbrick still believes victory is on the way – if the left can build a big enough volunteer army.

At this point, a conversation ostensibly about ideas becomes one about political organisation. “I think we’ve got very good academic and economic credibility for our arguments,” Swarbrick says. “But translating that into the real world, building trust in people’s belief that there is possible [change], and then actually enacting that … is a very different proposition.”

This, she says, “is where organisation is still the big missing piece – organisation on the ground”. She points to Polanski’s success in boosting the British Greens’ membership, to the point where it has reportedly surpassed that of the centrist Liberal Democrats and even the “natural party of government”, the Conservatives. (On her trip, Swarbrick also met the two leading figures behind Your Party, Jeremy Corbyn and left-wing firebrand Zarah Sultana, but is unsurprisingly more guarded about those encounters, noting only that the nascent party’s internal fighting is “rough as guts”.)

In New Zealand as elsewhere, it tends to be centre-left Labour and Democratic parties that have the strongest ground game. So could the Greens really surpass them? “Over time, yes,” Swarbrick says. One central task is “building coalitions” with faith groups, community organisations and the union movement, although the latter’s historical ties to Labour means any relationship with the Greens “will look different”.

The task for politicians, as she sees it, is to “think beyond electoral cycles” and generate public trust by being less opportunistic. “People, when you talk to them on the ground, don’t just want politicians to turn up when it’s election year and times are easy and they’re cutting ribbons. They want you to turn up when they’re having a bad day and stuff is hard. That process of constant accountability – that is where you build trust.”

This insight serves, in fact, as Swarbrick’s “major takeaway” from her trip. “I think we have … a really good diagnosis of the problem, we have clarity on a number of the tools that are necessary to move forward. But the gap that we have to bridge is trust.”

The Post: Why this might be the ‘angry centrist’ election

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The current paradox of New Zealand politics is that the public is the angriest it’s been for decades – but has in no sense shifted decisively left or right.

The country isn’t doing well: everyone knows that. The health system is a mess, our infrastructure is crumbling, and thousands are leaving for Australia. Still in the grip of the long pandemic-era hangover, the public’s ambient mood is bad.

None of this, though, has pushed middle New Zealand into the arms of either the right or the left. Big change may well be waiting in the wings: in this country we get it every 40 to 50 years, starting with the 1890s Liberal creation of a bare-bones social welfare state, continuing with the first Labour government’s 1930s-era fulfilment of that dream, and culminating in the fourth Labour government’s betrayal of it in the 1980s.

But even on that timetable, the next sweeping shift might not arrive until the next decade. Right now, one can feel the pressure build without any clear sense of where it will burst out.

Partisans on the right point to an increased ACT vote share, up at 8% versus less than 1% last decade. But that’s counterbalanced by a strengthened Green Party, comfortably polling twice the 5% threshold it once looked set to fall below.

Feeling these opposing pulls, middle New Zealand remains exactly where it was: dissatisfied with life but unsure about the proffered solutions. Which is where the latest theory from the New York Times comes in.

Mapping hundreds of recent American electoral contests, the Times has found that the politicians who can win crucial swing states and voters are what it calls “angry centrists”. As the name suggests, these are not the bland, status-quo-defending moderates of days gone by.

They are, instead, people like Ohio Democrat Marcy Kaptur, who happily attacks “the far right taking away women’s rights and protecting greedy corporations at every turn” but also lambasts “the far left ignoring millions illegally crossing the border and trying to defund the police”. Kaptur got re-elected in a state Donald Trump won by seven percentage points.

Such politicians, in short, are left-wing on economic issues and right-wing on cultural ones. They want to break up corporate oligopolies but take a tough line on crime. Far from being boring, angry centrists are “combative and populist”, the Times argues, promising sweeping change while criticising mainstream elites as out of touch.

If middle New Zealand is indeed resolutely centrist but also very angry, such an approach could be electorally potent. Analysis by the Post’s Henry Cooke shows 71% of 2023’s swing voters thought the economy had got “a lot worse”, but only 2% wanted further progress on Treaty issues.

Angry centrism is, of course, what New Zealand First does already. And one can also see the appeal for Labour.

The party knows that the cost of living is the dominant issue in New Zealand politics. Its MPs talk glowingly of their Australian counterparts’ decisive victory in May, one underpinned by Anthony Albanese’s relentless focus on household budgets and material issues.

New Zealand Labour’s greatest problem is that, having chosen a minimalist capital gains tax that garners equally minimal revenue, it will be unable to spend much on alleviating cost-of-living pressures. This puts even more onus on areas like competition policy.

Populist moves to break up oligopolies in energy generation, supermarkets and elsewhere could both lower prices and harness public anger. The bargaining strength of workers could also be boosted without any strain on the government’s books.

Such a focus on economic issues, at the expense of cultural ones, might be hard to justify ethically. Women still face horrendous levels of domestic violence; Israeli forces have killed 20,000 innocent children in Gaza; Māori live seven years fewer than Pākehā and are discriminated against in hospitals and courtrooms.

Middle New Zealand doesn’t have hard-right views on these issues. But it almost certainly doesn’t want to hear politicians focusing on them. The more that Labour does so, the less likely it is to win next year.

Winston Peters will still try to fight the culture war fight. But his attacks on “woke” politics and gender-neutral toilets will be, as much as anything else, wedges used to separate Labour from middle New Zealand.

Watching the main centre-left party trying not to engage on these cultural issues, while also not going so far right as to alienate its base, is unlikely to be an edifying experience.

But as the British pollster Michael Ashcroft once wrote: “If an election is an exam, voters will set the question; parties that choose to answer a different question will be marked accordingly.”

The state of the economy is foremost in the public’s mind and, like it or not, looks set to dominate the year ahead.