Gordon Campbell on the tea tape, billboards, minimum wage   16 Nov 2011

Gordon Campbell

First the secret cuppa tea tape, then the billboard defacement plot. Just when the election campaign looked like the mainstream media might have to focus on boring old policy, here come the diversions to the rescue. Was serial billboard defacer Jolyon White one of Russel Norman’s highly trained squad of Green ninjas, or part of a radical Anglican sleeper cell?

The collateral image to the Greens new image of political sobriety has yet to be assessed, but – clearly – the Greens have more to worry about from the actions of their friends than from their enemies. During the 2002 election campaign, they were left scrambling to avoid blowback from the Corngate revelations by Nicky Hager, despite knowing absolutely nothing about the matter until Hager’s book hit the stands.

As election stunts go, White’s actions were at the low end of public disorder – it was peaceful, satirical comment – and Sue Bradford has a point when she says that by dobbing White in, the current Green party has effectively cut itself off from what used to be its activist base. Even so, at this stage of the campaign, a fairly ruthless cost/benefit standard had to be applied. Could the risks involved with this form of activism be justified, given how it would be used to revive negative stereotypes about the party? Clearly, no.

By hubristically going onto RNZ to brag about his actions, White had made it inevitable that his identity – and affiliations – would eventually become publically known. With less than a fortnight to polling day Norman had no option but to try and pre-empt any revelations that might carry over into the final week. Especially given the fact that even in normal conditions, the Greens have traditionally had trouble carrying their high poll numbers through to the outcome on polling day. As for Norman’s decision to stand down his executive assistant Anne Heins… It seems reasonable to expect a ‘no surprises’ policy from your own support staff.

John Key has the bigger problem. Once things start to go wrong on something like the Epsom stunt, they tend to snowball. Key’s attempt for instance, to liken the leakage from his staged photo op with John Banks to the hacking by News of the World journalists of the cellphone of murdered British schoolgirl Milly Dowler has now been denounced as a “cheap shot” by the British lawyer acting for the Dowler family. For Key’s benefit, British barrister Mark Lewis spelled out the difference:


There is a difference between the News of the World hacking into someone's phone to find out private information and seemingly - whether accidentally or on purpose - effectively a journalist investigating some kind of political statement.

"But if it's particularly a political statement which affects the future government or the ways to achieve future government in a country, then that's something in the public interest and it sounds like it should be reported, without the unfavourable comparison to what was clearly a criminal act."

Day by day, Key is being left with less and less room to hide. It is time for him to man up and take the consequences of his actions. For someone who has made his carefully manicured personality into his government’s greatest asset, any gap that the tape’s content may reveal between image and substance is going to be magnified – but it is just as clearly in the public interest. Like Jolyon White, Key has only himself and his hubris to blame for the position he finds himself in.

Minimum Wage Rises

The cuppa tea tape is not the only item relevant to the campaign about which Key has been less than forthcoming. Early last year, a Treasury paper on the links between employment and raising the minimum wage contained evidence that there is no significant causal linkage between the two.

That Treasury paper only became available after an OIA request, and Key has consistently cited an alternative finding in a Department of Labour paper that job losses would result. Labour has now accused Key of selectively using only those bits of publically funded research that fit his party’s policy position, instead of putting all the evidence on the table. In a damage control exercise, National’s campaign manager Steven Joyce has argued to the contrary:


He said Mr Goff's assertion about the Treasury report was wrong. "The claim that Treasury does not think the minimum wage affects jobs is wrong," he said. "It was based on an edited quote from an exchange of views between a Treasury staff member and a Labour Department staff member about the youth minimum wage.

"The Treasury has told the Government that the minimum wage does impact on employment."

If Joyce is right – and if the 'exchange of views'’ really does (on the whole) come out showing an impact on employment that is demonstrably socially and economically significant, then we may have a global breakthrough here. That Treasury paper dated from March 2010. Late in 2010, US labour market researchers at UC Berkeley released a breakthrough research paper which shows the reverse: that increasing the minimum wage does not lead to the short term or long term loss of low-paying jobs.

The paper is the culmination of a series of competing papers on the links between minimum wage hikes and employment, dating back to the early 1990s. The UC Berkeley paper supports the original seminal paper on the subject by economists David Card and Alan Krueger, who is now Barack Obama’s chief economic adviser.


This is one of the best and most convincing minimum wage papers in recent years,” said Lawrence Katz, an economics professor at Harvard University and a specialist in labour economics. Much economic policy discussion today is more focused on a general lack of jobs rather than on inadequate pay, said [Berkeley economist Michael] Reich, but that doesn’t negate the need for adequate or “living’” wages.

Although increasing the minimum wage can stimulate the economy by putting more money in the pockets of those most likely to spend it on necessities, he said, suggestions to raise minimum wages typically trigger fears. These fears centre around the idea that raising the minimum wage would force many employers to reduce job offerings to meet a more expensive payroll, or that a “tipping point” where the minimum wage becomes too high has already been reached…. [The] findings indicate that an entire generation of previous minimum wage studies that found negative effects on jobs is fundamentally flawed….

The article noted that 17 states and the District of Columbia had a minimum wage higher than the federal level in 2005 and consistently lower job growth than the rest of the country from 1991 to 1996. However, those 17 states and states on the other end of the minimum wage spectrum experienced almost identical job growth between 1996 and 2006.

A link to a subsequent 2011 paper by the UC Berkeley researchers on the (lack of) significant causal linkages impact raising the minimum wage and teen employment can be found here.

In the face of these kind of research findings, those claming that raising the minimum wage in New Zealand will have an unacceptably high impact on jobs tend to make a kind of ‘Goldilocks’ argument – that the US data is from states where the minimum wage is too low to have relevance here, while the minimum wage in Australia is too high to be relevant, either. And if you believe that we’re so unique that economic findings from elsewhere have no relevance… then I have a state asset I’d like to sell you, cheap.



Add a comment

Bookmark and Share


PM welcomes closer partnership with ASEAN

22 Nov 2015 News
New Zealand Government Rt Hon John Key Prime Minister 22 November 2015   PM welcomes closer partnership with ASEAN Prime ... more

Submissions open for United Nations report

20 Nov 2015 News
Minister for Women Louise Upston welcomes public consultation on a draft report for the United Nations outlining New Zealand’s... more


Increased Canterbury quake costs pushed Tower into the red

20 Nov 2015 Business News By Paul McBeth
Nov. 20 (BusinessDesk) - Tower, the general insurer, says it will report an annual loss next week after raising its provisioning for... more

NZ inflation expectations drift further below 2% mid-point

17 Nov 2015 Business News
Article - BusinessDesk   NZ inflation expectations drift further below 2% mid-point Nov. 17 (BusinessDesk) - Longer term ... more


Awards recognise NZ recreation's top performers

20 Nov 2015 Lifestyle
New Zealand’s recreation industry recognised 10 inspiring individuals and organisations at the New Zealand Recreation ... more

Villa Maria Proves a Huge Hit

16 Nov 2015 Lifestyle
VILLA MARIA PROVES A HUGE HIT TO OPEN SOVEREIGN TRI SERIES The Sovereign Tri Series for 2015/16 is underway with today’s... more


Auckland house price growth slows in Oct as new rules bite

4 Nov 2015 Property By Tina Morrison
  Auckland house price growth moderates in October as new rules introduced Nov. 4 (BusinessDesk) - Auckland house price growth... more

Tenancy bond system moves online

1 Nov 2015 Property
New Zealand Government 1 November 2015 A new tenancy bond service goes online today as part of the Government’s programme of... more


New migrant service launched for New Zealand and Australia

12 Oct 2015 Migration
Those looking for a sense of security when immigrating to New Zealand or Australia, need look no futher than the first inusrance... more

NZ's annual net migration reaches record 60,300 in August

21 Sep 2015 Migration
  NZ's annual net migration reaches record 60,300 in August on Indian, Chinese students By Jonathan Underhill Sept. 21... more


Australia's cloud passports only "conceptual" for now: DIA

29 Oct 2015 Travel & Tourism By Fiona Rotherham
Internal Affairs says Australia's cloud passports only "conceptual" for now   Oct. 29 (BusinessDesk) - The Department of... more

Auckland Airport a 'conductor' for New Zealand tourism: CEO

22 Oct 2015 Travel & Tourism By Fiona Rotherham
  Auckland Airport a 'conductor' for New Zealand tourism, CEO Littlewood says Oct. 22 (BusinessDesk) - Auckland International... more


Richie McCaw retires from rugby

19 Nov 2015 Sport
New Zealand Rugby Union Richie McCaw retires from rugby Richie McCaw has today confirmed he is hanging up his boot... more

Burling and Tuke on top at the mid-way mark

19 Nov 2015 Sailing
Yachting New Zealand Burling and Tuke on top at the mid-way mark at 49er World Champs Peter Burling and Blair Tuke have taken the... more


Gordon Campbell on why IS’s weakness makes it more dangerous

20 Nov 2015 Opinion By Gordon Campbell
Gordon Campbell on why Islamic State’s growing weakness makes it more dangerous One of the great things about writing online... more

Gordon Campbell on Islam and the Paris attacks

17 Nov 2015 Opinion By Gordon Campbell
According to polls, a third of Republican voters in Iowa want Islam to be criminalized. Unfortunately, the c... more

Kiwi Success

Cavalier promotes CFO Paul Alston to top job

20 Nov 2015 Appointments
Article - BusinessDesk   Cavalier promotes CFO Paul Alston to top job By Paul McBeth Nov. 20 (BusinessDesk) - Cavalier Corp, the... more

Employment Court Judge appointed

20 Nov 2015 Appointments
New Zealand Government Hon Christopher FinlaysonAttorney-General 20 November 2015 Kerry Smith, barrister and solicitor of... more


UPDATE: Weaker employment adds to rate-cut case

4 Nov 2015 Recruitment By Johnathan Underhill
Article - BusinessDesk   UPDATE: NZ employment falls in third quarter, adding to case for further RBNZ rate cut (Recasts to... more

Unemployment rises 0.1 per cent

4 Nov 2015 Recruitment
The latest Household Labour Force Survey (HLFS) has reflected the softening of the economy in the first half of the year, with an... more