Thursday, November 17, 2005

Treasury's ideological burp

During the 80's and 90's. Treasury managed to earn itself a reputation as a bunch of rabid idealogues who were the driving force behind the radical free market "reforms". While having to work with a Labour-led government hostile to that programme has forced them to restrain themselves over the last few years, this year's Briefing to the Incoming Government shows that they haven't changed a bit. In it, they recommend gutting the RMA, selling SOEs, introducing work testing for those on the sickness and invalids benefits, and shifting the burden of taxation onto the poor by giving large tax cuts to the rich (while warning that "additional fiscal stimulus in the short term may exaggerate the economic cycle" - meaning send inflation through the roof) - restarting the Revolution, in other words. National is of course crowing, but this is hardly neutral policy advice. According to One News last night, Treasury thought National was going to win the election, and tailored their advice to suit.

What is worrying is that there is clearly still a large faction of senior people within Treasury ideologically committed to the Revolutionary agenda, and just biding their time to try and impose it on the New Zealand public. These people are crossing the line from public servants into political agitators, and they should consider carefully how their ideological commitment affects both their policy advice and their political neutrality. The proper thing for these people to do is to resign and stand for election, rather than continue attempting to impose their ideological agenda by stealth from within the government. But I guess Graham Scott showed them how little appetite the public has for their policies...


Idiot, switch to decaf - seriously. If your idea of a "stealth agenda" is a publicly released and widely commented on briefing paper that the relevant Minister is under precisely NO obligation to act on, I don't want you organising my attempt at global domination.

But, hey, I'm with you. Let's ideologically cleanse government departments of "rabid ideologues" who don't tell the Government of the day exactly what it wants to hear. I've got my little list of Molesworth Street pinkos who will be first against the wall when the revolution reboots.

Posted by Craig Ranapia : 11/17/2005 10:47:00 AM

That is, assuming that the 'revolution'doesn't come down with a virus that prevents rebooting for some time...

Craig Y.

Posted by Anonymous : 11/17/2005 11:17:00 AM

Craig: it's not about "telling the government what it wants to hear" (though ironically, that is exactly what Treasury was trying to do - they were just wrong about who that government would be), it's about ideological capture.
Govenment ministries are supposed to approach policy from various angles, rather than being wedded to any particular ideology. This is clearly not the case with Treasury. This both weakens their output due to a lack of internal criticism, and makes it more difficult for them to fulfil their duty to be able to work with any government.

Historically, the problem goes back to the early 80's, when Treasury was captured by radical market darwinists pushing a rigid, deductive approach to policy advice based on derivation from first principles. These people then mounted an internal purge of dissenting viewpoints, resulting in such wonderful pieces of batshit lunacy as their 1987 briefing, Government Management. I thought they'd begun to get better after 1996 or so, but it seems I was mistaken...

Posted by Idiot/Savant : 11/17/2005 11:41:00 AM

Treasury does not serve the public in a disinterested manner and has not done so for many years. Another worry is that many Treasury staff propagate the higher ranks of other government agencies and infect them with their rabid ideology. Labour's fault is that it did not change the State Sector Act and restore public service neutrality - probably as a result of political cowardice.

Posted by Anonymous : 11/17/2005 12:18:00 PM

Good post I/S,

I've just had a read through Treasury's breifing and it is nasty: ideology dressed up as "economics".

It's interesting that they claim that lower tax-rates lead to higher long-run growth. They cite "recent studies" but provide no references; which makes me ever so slightly sceptical about just who may have undertaken these studies. (Not to mention the fact that there is a whole heap of evidence to suggest that - within reason - progressive systems of taxation don't retard growth).

In all honesty I wonder whether we might be off with a system like that which exists in the states where the government appoints its own team of economic advisers. Something that ensures that the economic advice recieved tends to correspond to the ideology of the government (and hence reflects voters wishes). Something that is important as much in the field of economics ultimately boils down to value judgements about trade offs.

Of course the current situation in the State could be seen as indicative of the failures of their system....

Posted by Terence : 11/17/2005 12:20:00 PM

typos typos typos

states - should read States

State - should also read States

Posted by Terence : 11/17/2005 12:21:00 PM

Icehawk: Treasury has always espoused one law for them, and another for everyone else. During the 80's and 90's they were urging budget cuts for other departments - meanwhile, theirs continued to rise, to fund a massive expansion in policy analysts.

As for the lack of references, it's not at all unusual for this sort of document. It's a briefing to a Minister, not an academic paper...

Posted by Idiot/Savant : 11/17/2005 04:39:00 PM

It is good that Treasury is not infected with political correctness like the rest of the civil service. It is good to see they are providing some useful sensible advice rather than some twaddle about civil liberties or sex changes operations that usually comes out of Wellington

Posted by Anonymous : 11/17/2005 07:33:00 PM