Open NZ to innovators and attract the next Sergey Brin
2 June 2021
Opinion: Budget shows the Government doesn't understand NZ must attract innovative talent to drive the economy out of an OECD backwater, writes Ananish Chaudhuri.
When it comes to the Budget, everyone has an opinion. But unless one is deeply familiar with the nuts and bolts of the budgeting process, it is not easy to understand what the trade-offs were and why certain calls were made.
It is also the case that, for us average punters, the numbers are pretty much meaningless. A billion here; a billion there, what does it all mean? We don’t know if this is an increase or a decrease from the current baseline; what fraction of Crown revenue does this represent and what does the increase in spending in one area mean for spending in another?It is also the case that the budgeting process for a small open economy in the middle of the South Pacific is not easy since we are seldom the masters of our own destiny. A lot will depend on what happens to our trade with China or the US, which in turn depends on how those economies rebound from the pandemic.
... authors of the current budget are not only worrying about three decades old wrongs but are trying to address them with three decades old thinking. Three decades ago, 'Googling' had not become a verb; China was still a relatively poor country; the massive off-shoring of jobs was still to come; Amazon was still a river in South America.
So, we pontificate on the basis of our own perspective; we talk up those things that we like and disdain those that we do not. So, having said that and with a due mea culpa for my own pontificating, here are few thoughts that have come to mind following on from Budget 2021.
First off, a budget needs to be understood as an aspirational document that sets out our priorities and goals. Given that this is the case, surely there is something wrong with a budget that starts out with the explicit purpose of correcting three decade old wrongs. This does not mean that those old inequities should not be addressed, but my fear is that the authors of the current budget are not only worrying about three decade old wrongs but are trying to address them with three decade old thinking.
(And remember, three decades ago, there was no iPhone or iPad; “Googling” had not become a verb; China was still a relatively poor country; the massive off-shoring of jobs was still to come; Amazon was still a river in South America and social media did not exist.)
Ananish Chaudhuri is Professor of Experimental Economics in the Business School.
This article reflects the opinion of the author and not necessarily the views of the University of Auckland.
Used with permission from A lesson for our Govt: Inviting the next Sergey Brin to build the next Google 2 June 2021.
Alison Sims | Research Communications Editor
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