Antipodean Dreaming

New Zealand seems flavour of the month in the States. There's a new book out making the case that New Zealand's living the dream of an egalitarian society based on fairness; it's been getting a fair bit of press. I'm a third of the way through and will blog a proper review when done.*

Thomas Friedman visited the Antipodes this week; he files this report.  

I agree with Friedman that the relative absence of a strong religious right makes politics relatively more sane. Religious movements of the more politically active sort tend to be based around Pacific island immigrant communities and lean Labour; a strong secularist bent within the upper Labour echelons keeps things in line. And so Labour legalized prostitution and created gay marriage via civil unions.** Atheists outnumber any single Christian denomination in New Zealand; I'd be surprised to see any Labour or National leader making a point of being seen making any religious observances other than the annual Ratana Church pilgrimage, which to this migrant has always seemed more a recognition of the mana of the Ratana movement than a demonstration of faith.

But I only wish the U.S. Democrats were sufficiently sane that this line of Friedman's could be true:

In New Zealand and Australia, you could almost fit their entire political spectrum — from conservatives to liberals — inside the U.S. Democratic Party.

Here is a short list of current policy, broadly agreed upon in New Zealand politics (as best I can tell), that I cannot imagine fitting inside the U.S. Democratic Party. Just the things that come to me in thinking about it for fifteen minutes; I'm sure there are many many more.

• A relatively flat income tax system topping out at 33% (Labour would prefer 38 or 39).
• No capital gains tax (Labour now claims to favour one, but did not implement one in their last decade in power).
• A highish (15%) and very very clean VAT in the form of GST. Zero politically-motivated exemptions. Books are taxed. Kid's clothes are taxed. Even your city council property taxes include GST: council provides you a service, and that service attracts GST so as not to introduce other distortions in the choice between Council and private provision of services.
• Same thing in income taxes: they're generally very very clean. Most salary and wage earners don't have to file any taxes at all. It's just withheld at source. 
• Free trade in agriculture without subsidy. Imagine Obama, today, abolishing the entire edifice of U.S. agricultural protectionism. Labour did it in New Zealand in the 1980s and there's no going back.
• Neither National nor Labour have any interest in ramping up military spending.
• A crazy woman tried hijacking one of our planes a couple of years ago. The country said meh, as did the politicians. I am flying to Auckland later today. I will arrive at the airport a half hour before boarding. If the plane is large, I will walk through a metal detector; otherwise, I will walk directly to the gate. When I get to the gate, I will wave my phone at the sensor. And then I will walk on board. 
• New Zealand's abortion policy is de facto liberal but de jure restrictive. Nominally, women need a medical reason for having an abortion. That makes the social conservatives happy. Actually, depression caused by not wanting to have a baby is a medical reason for having an abortion. That makes women who want abortions happy. In America, identity politics would prevent this happy equilibrium. 
• Parliament opens with a prayer. I chalk this up to status quo bias. Knocking it out would slap the religious people around over something pretty trivial. Folks here just seem a lot more willing to give the cheap tokens of respect that keep everything running over smoothly.
• Kiwis largely traded away the right to sue for damages in exchange for a government accident insurance fund: ACC. ACC has loads of problems. But, in second best worlds, NZ's solution seems far better.  (National's potentially considering privatizing ACC but not wrecking tort.)

I'm also a bit skeptical about Friedman's claims that Antipodean sensibility comes down to compulsory voting systems. The story isn't crazy, and Justin Wolfers seems to endorse it. If you can be assured your base will turn out, then you don't need to do crazy stuff to play to them. But while Australia has compulsory voting, New Zealand doesn't. And I've seen no evidence that New Zealand election campaigns are nastier than Australian ones. 

Friedman continues:

To be sure, conservatives out here have all the low-tax, free-market, free-trade, less-government instincts of their American colleagues, but it is tempered by the fact that campaign donations and lobbying are much more restricted.

Ok. Labour*** governed as strong free traders under Helen Clark, giving New Zealand a bilateral free trade deal with China, something else that wouldn't exactly fit within the scope of permissible policy views within the Democratic Party. 

But I wonder in which direction causality runs on campaign donations.The NZ Electoral Commission recently released the numbers from the 2011 election; no party reached its spending cap. If the government here is less likely to award rents, then we expect less rent-seeking. 

I'll look forward to finishing the Hackett Fisher book.

* Tyler blogged on this ages ago. When it popped up there, I called the University bookstore. They said they could have the book to me end-March for twice the price that BookDepository quoted. So I got it mid-March from BookDepository. I had to get a book on New Zealand - not just any book, but a big scholarly tome from Oxford Press - shipped to me from the UK because it wasn't yet here at the University bookstore. Very much enjoying the book thus far.

** This is almost the perfect compromise legislation. If the religious folks get mad about the word marriage, call it civil union and give it all the same legal status. Except gays married under NZ's civil unions legislation have a hard time in adoption: it's apparently not easy to have the partner listed as adoptive second father (mother) of the other's child or of a child adopted by both. Otherwise, hooray for Labour.

*** Labor governs Australia (but likely soon won't); Labour has governed New Zealand and are favourites to govern again in 2014. I'm sure that Friedman drops the "u" from Labour by accident rather than implying that we've taken the option of Australian statehood.