Thoughts On The Deceptive Mind The Gap Doco That Got $160,890 From NZ On Air

This week TV3 aired a documentary purporting to be about how neoliberal zombie economics has led to high levels of inequality. Now, the guy who made the doco, Bryan Bruce, is a well regarded New Zealand documentary filmmaker. He even managed to convince TV3 to run a documentary on child poverty a few days before the last election. In fact, he’s so well regarded that he has won numerous awards and since 1999 his production company Red Sky Film & Television Limited has received over $4.75 million dollars from New Zealand On Air.

He thinks that the gap between the rich and the poor should be closed. But when he starts talking about inequality he is not very clear what he means. He doesn’t talk about the difference between income inequality and wealth inequality, or how the data in New Zealand actually isn’t that much to be concerned about. He also makes the mistake of thinking no one would call him out. He has cherry picked experts the same way Fox News cherry picks experts who are cheerleaders for bombing Syria.

You don’t need to be poor to talk about poverty and inequality – but I do think that when you are getting taxpayer money you better not take the mickey when the people you are talking about, at the bottom of society, could never dream of getting taxpayer money to bankroll their self-actualisation through making a documentary that feels like a progressive sermon on the immorality of the marketplace.

Bryan Bruce’s company has received an average of almost $339,000 per annum for the past 14 years. He will of course have incurred a lot of production costs, but the ability to access NZ On Air funding to such an extent automatically makes you part of New Zealand’s elite – the very elite that the documentary was railing against.

It also leads to an interesting question – if the man making the documentary railing against neoliberal trickle down zombie economics can only make such documentaries because of the taxes paid by the middle class and “the rich”, is the “new normal” post 1984 really that bad? I mean, if his doco was in any way, shape or form accurate, there’d be no such thing as NZ On Air right?

If what he is saying is true – that neoliberal economics and the doctrine of self-interest has completely ruined New Zealand society with rising inequality, how is it possible that hundreds of thousands of dollars of taxpayer money can be allocated to a documentary that, if accurate, would expose the evil of neoliberal trickle down zombie economics?

If “successive neoliberal governments” had acted like short-term profit maximisers instead of long-term shareholders in the “biggest family business in New Zealand”, why is there any redistribution left? Why has Working For Families not been rolled back? Why have interest free student loans remained? Why has the accomodation supplement remained and why are National building a lot of state houses to met rising demand?

A central story that Bryan Bruce was trying to tell was that the changes in income and wealth distribution in New Zealand have turned everyone except the rich into pay to pay struggling battlers. He tries to argue that the middle class pays taxes that subsidise low wages and end up in the pockets of “the rich” because people on lower incomes need to spend most of their money to pay their bills.

He asks the question “What’s an economy for anyway?” as if any deviation from what he believes is a morally degenerate deviation from “Christian ethics”. He makes the laughable claim during his romanticisation of pre-1984 New Zealand that there was “goodness and decency in the marketplace”. What complete and utter rubbish!

Anyone aware of basic New Zealand economic history would realise that we have as interesting a history as any other country when it comes to dodgy businesspeople and labour force mistreatment. Read about Auckland property speculators in the 1880’s or the how the early trade unions were treated – “goodness and decency in the marketplace place” pre-1984 is Tui billboard stuff.

He also trumpets out a number of experts including The Spirit Level spruikers who reinforce his central question, lambasting “neoliberal zombie economics” without explaining what he thinks that means. He also ignores the reality of the 1984 Balance of Payments crisis and misrepresents Treasury as offering a dishonest solution to the problem.

New Zealand was literally broke, floating the currency was essential and the reforms led by Roger Douglas were mean and nasty but necessary. They might have annoyed a lot of people in New Zealand society, but for God’s sake it was 30 years ago!

That is more than enough time for people to alter their education and training decisions and live in the real world of ruthless global competition. Warm fuzzies over sharing and caring cannot change the reality of the new normal – we are interchangeable cogs in a system that can never go back to “the way things were”. The challenge is to adapt, not have a whinge because no one cares about anyone else anymore. Even family is a crimespeak word these days.

I was particularly concerned over Dr Lisa Marriott’s interview. She pointed out correctly that benefit fraud is a rounding error – but her guess of “up to $5 billion of tax evasion” is ridiculous on its face. Anyone who has followed Inland Revenue’s recent success in the courts (particularly with respect to how foreign investors finance large capital investments) and changes in enforcement policy would be able to tell you that tax evasion is being aggressively chased down already, as it should be!

It is nowhere near the problem that Bryan Bruce’s tribe make it out to be, let alone worthy of being labelled “stealing”. And in fact, the worst “tax evaders” are his beloved middle class with their rental properties. The Inland Revenue has clawed back hundreds of millions of dollars from these struggling battlers who traded properties without paying income tax on the gains. If you have a real cash flow positive and profitable businesses, it is essentially impossible to not pay tax because you will be returning net GST!

When he talks about how owners and managers have taken “a higher share of the wealth created”, he does not discuss changes in the labour market related to skill, scale and technology. He does not mention job polarisation and how “the new normal” cannot be blamed on “the rich”. He does not mention how some of the new jobs created are pretty sweet in comparison to working on the factory floor or in a mine.

The statement that neoliberal economic policies are killing our children is the appeal to emotional weakness. The children are being killed! We must do something! What he conveniently ignores is that New Zealand actually has a pretty exceptional safety net. He also ignores the fact that more people at the bottom of society are there from dumb life choices as opposed to being born disabled or with physical or mental disabilities that make workforce integration difficult.

Again, if neoliberal zombie economics had ruled successive governments since 1984, why is there still any redistribution left? Oh, maybe that’s because most Kiwis realise a basic level of support is necessary and thus welfare reforms are primarily at the margins. And if you look at the angst around student allowances and student loans for living costs, you’d realise that most people realise that completing a degree requires government support.

Another disturbing segment was the talk of the financial transactions tax or Tobin tax. He doesn’t mention that Tobin wasn’t really serious about it or that in its current implementation in European countries it has caused problems in the financial sector and imposed substantial compliance costs. As for raising 100 billion pounds, unlikely. That he didn’t call the Tobin tax by its correct name was a major red flag – it’s almost as if he didn’t want people fact checking his documentary to know what to look for. I mean “robin hood tax” how could you be more of a duplicitous douchebag with a phrase like that when it would affect every single person rich or poor’s financial transactions?

The discussion of minimum to maximum wage coupling – where bosses can only earn a specific multiple of what the lowest paid worker earns – was even more disturbing. There is no discussion of how the real world works – problems flow uphill, bigger companies and more complex business processes mean that to keep it all together you do need a bigger pay packet.

Also, in case you fell asleep in 1984 thinking it was all a dream, we are now in a competitive global labour market where your labour is interchangeable with other people. Of course there will be major gaps in pay packets just purely on supply and demand factors before even taking into account the complexity of managing multinational organisations. If you kept up with the economic literature you’d have a good grasp of reality as opposed to platitudes like “CEOs are taking the wealth from the pockets of workers”.

The families he depicted as struggling at the beginning of the documentary are portrayed as victims of the rich. There is no discussion of the life choices they have made and must therefore carry the life debt for. Maybe they had bad luck – but the sob story he is trying to play off ignores a major problem. Many middle class couples can’t afford children so they take their birth control and enjoy playing with their nieces and nephews instead. That’s called living in the real world – children are a luxury in 2013 New Zealand but not for the reasons Bryan Bruce thinks.

Maybe life sucks because it is a competitive situation. You cannot afford to make a mistake at any point now. You can’t get knocked up in high school, you can’t perform poorly at high school, you can’t perform poorly at university, you can’t make any mistake whatsoever in your personal life that could impact your future prospects. This is reality now. There are very few do-overs, but New Zealand is pretty much the only OECD country where it is still possible to claw your way back from the bottom of society because of the safety net and opportunities we have on offer for people down on their luck or struggling.

I thought it was a bit silly to talk about inequality without laying out a pathway for personal empowerment. The internet is full of free knowledge, being drug & alcohol free is essentially the main requirement now for entry into skilled construction trades, there are support schemes out there if you actively look for them and if you spend time at the library reading books for free you’ll be able to figure out a way out of whatever hole you are in. Blaming the rich without taking any personal responsibility is utterly pathetic and ignorant.

His conclusion that neoliberal zombie trickle down economics has failed to deliver for most people has some “at first blush” credibility. There are big numbers involved these days – $10,000 for a beneficiary but Air New Zealand’s CEO earns $1.2 million in six months. But when you look at social mobility data, the amount of stuff you can get for free these days, the reality that if you cook your own meals and live a frugal lifestyle you will get by just fine, the whole documentary is just one big progressive whinge.