On trade and foreign ownership, Peters is talking sense…
by Gordon Campbell
Reportedly, Winston Peters is treating foreign ownership as a key issue in the coalition talks.
In particular, Peters seems deeply concerned about the investor state dispute mechanisms contained in our trade pacts, and the loss of sovereignty this involves. He is absolutely right to feel concerned. He is also at risk of being seriously misled by National’s negotiating team.
Yes, every trade deal needs to contain some way of resolving any disputes that arise. Yet currently, the ISDS mechanisms in the Trans Pacific Partnership deal would have to be the fourth best way of resolving them. Regardless, the National government is clinging to the ISDS procedures as if they’re essential to modern global trade.
They’re not. The three better routes of dispute resolution are (a) our local courts (b) the dispute resolution mechanisms operated by the World Trade Organisation and (c) the dispute mechanisms that EU Trade Commissioner Cecilia Malmstrom has been touting for the past two years, and which she has pursued in the EU’s trade deals with Vietnam, Canada and only a few months ago, with Japan.
First and foremost, our trade commitments should explicitly require foreign companies to exhaust local court remedies before heading off to foreign arbitration. Even then, the EU dispute mechanisms offer greater transparency, evidence disclosure rules, rotating panels of judges and appeal rights that we associate with a normal court of law, and – reportedly – New Zealand is currently seeking a trade deal with the EU that will surely contain them. So why then, is the National government still simultaneously clinging to the ISDS ad hoc arbitration panels contained in the TPP, which are outmoded, open to capture by multinationals, and which pose genuine risks to our national sovereignty – as Canada has repeatedly found to its cost?
The new EU dispute arbitration system was explained in this Werewolf article 18 months ago. Yes, the current TPP text does contain the old, much criticized ISDS system, but the current TPP text is hardly sacrosanct. At a meeting in Tokyo only a few weeks ago, the TPP 11 countries had reduced (!) their slate of freeze requests on contentious existing TPP clauses to 50 outstanding items (!!). Here’s how the Japan Times summed up the state of play as of late last month.
The 11 countries are seeking to reach a new agreement by November to implement the pact but member countries have made dozens of proposals for freezes to the current deal, in particular clauses introduced at U.S. request…
“We have done a lot on sorting out the requests,” Kazuhisa Shibuya, the [Japanese] government’s spokesman on the TPP, told reporters…. Shibuya said there are around 50 requests for freezes that need to be considered…Three working groups on legal, intellectual property and other issues are expected to continue assessing the various requests…
As the influential Yomiuri Shimbun newspaper also pointed out, these manoeuvres include requests to freeze the ISDS dispute system.
The negotiators broadly agreed to freeze the [TPP] provision on a data protection period for bio-pharmaceutical drugs, under which pharmaceutical makers are essentially allowed to sell such products exclusively for eight years. The participating countries are seeking to freeze a range of provisions, including procedures to resolve disputes between companies and their investment destination countries, and liberalization of government procurements for foreign firms.
Looking ahead, we would earn useful brownie points in Europe if we were seen to be encouraging Japan to adopt the EU’s favoured dispute resolution system. According to TPP advocates, this TPP 11 deal is due for completion by November. (Presumably, Peters is being fed that completion date in the coalition talks.) Dream on. Those 50 outstanding items are going nowhere soon. Japan, New Zealand’s main ally in the TPP 11 process, has just called a snap election and Prime Minister Shinzo Abe is busy fighting off a substantial threat from the right wing governor of Tokyo, Yuriko Koike.
So, even if Japan thought the TPP 11 process was nearing closure – which it isn’t – Abe is in no position to advance it right now. Let alone Vietnam, let alone Malaysia, both of which see little value in a TPP 11 deal that no longer grants them access to US markets. Both are now pursuing bilateral trade deals with the US.
Meaning: Peters has lots and lots of room to breathe, and can quite legitimately demand changes to dispute resolution procedures that threaten our national sovereignty. In the process… MMP is once again proving its worth as a defence against ideologically-driven market extremism.
As we all know, Winston Peters never, ever plays off the back foot. Whatever Peters does, it is always the only right and proper and sensible thing to do, and if we’d just thought about it for a moment, we’d be agreeing with him. It is still anyone’s guess which way Peters will jump at the end of the coalition talks, yet since his own self-imposed deadline is looming (it’s Thursday or bust) we can at least turn our minds to what we’ve been just been (allegedly) too shallow to grasp, all along. In other words, we need to channel our inner Winstons. Because, come Friday, you can bet we will all be being bludgeoned by Peters, with at least one of the following sets of rationalisations.
1. Blue Winston.
If NZF decides to go into coalition with National, Peters will – fairly or otherwise – roll out a few FPP-era arguments to claim that he has merely responded to the (self-interpreted) will of the people, and that there was really no choice.
If it is to be National, the rationale will probably go something like this: “ Now, it may be news to some of you people in the media, but democracy is really about respecting the result that the voters deliver to us. Its not about what Winston Peters wants, its about respecting what the country has said. And if you people in the media could be bothered to do the simple arithmetic, you’d have seen that there was one party that got the most votes, and won the most electorates, right?
“Now, I’ve been out for months in those electorates, all around regional New Zealand. I’ve listened. And collectively, what the voters have said in the ballot box means that the centre-right won more votes and more seats than the centre-left. Since we adopted the MMP voting system, the party that won the most votes has first crack at forming a government. And frankly, the other side didn’t give me any compelling reason to overturn that convention.”
The secondary argument goes something like this, and it’s usable in the context of either a National-led or a Labour/Greens-led government. For good measure, Peters could add something like this: “New Zealand First has saved this country before from ideology and extremism, and we’ve done it again this time. In the negotiations, we’ve made significant gains for our old people, on free GP visits and on the Gold Card. Thanks to us, the next government is going to be more sensible in how we run our immigration system, how we run education, and how we value the contributions that regional New Zealand makes to this country’s wealth and wellbeing. Rest assured, we’re not going to be neglecting the needs of heartland New Zealand in order to chase the latest fad dreamed up in some coffee shop on Ponsonby Road.”
2. Red Winston
This is Winston Peters as the agent of change. It would go something like this: “This country faces real problems. The current National government has had nine years to deal with them, and it failed to do so. In the House I’ve watched National deny, time and again, that there is a crisis in immigration, in housing, in the problems facing our old people. And in the coalition talks, all I really heard from National was a promise of more of the same. Well, this country can’t tolerate three more years of the same. I didn’t go into politics – and New Zealand First doesn’t exist – to help to keep an intolerable situation ticking over indefinitely. The future needs of New Zealanders – old and young – demand new solutions. And we’re going to be at the centre of supplying them.”
Change can be scary but rest assured. If you listen to Peters, this wise old hand and his team will be playing a key role in ensuring capable and credible government. As in: “Now, I’ve been in politics for a long time. Longer than you lot in the media, that’s for sure. And I’m here to tell you that the experience and the sensible policies that New Zealand First has in profusion will provide a steadying, stabilizing influence on the untried leadership of this new government. We will also act as a necessary restraint on whatever may be proposed from the sidelines by the Greens, who simply do not understand the farming sector and the contributions made by regional New Zealand.”
3. Cross-bench Winston
This is the ‘plague on both their houses’ approach. This option puts Peters in the role of the nation’s guardian angel, and it would sound something like this: “It saddens me greatly that we have become such a divided country : rural vs urban, farmers vs environmentalists, rich vs poor, young vs old… and so on. New Zealand First did not create these fundamental divisions, but it can choose not to perpetuate them.’
‘By choosing to sit on the cross benches – and by treating each piece of legislation on its merits – New Zealand Party will continue to be what it has always been, a party for New Zealand, and for all New Zealanders. True, in order to ensure stable government we have arrived at a confidence and supply arrangement, and we’ve extracted gains on immigration and for our old people from doing so. Yet beyond that point, rest assured that New Zealand First will not be beholden to the centre-right or to the centre-left, but to what’s best for the entire country. We’ve had our fill of ideology from the right and the left and tts time now for the politics of common sense etc etc etc…’
Actually, Peters and his party have tactical reasons to shun any formal coalition deal with anyone. Peters simply hasn’t given himself enough time to safeguard any policy gains by NZF within a detailed and prescriptive coalition document, as he did in 1996. Historically, Peters also has ample reason to feel wary about going into a coalition with either major party. Twice before, formal coalitions have ended in disaster for NZF.
In 1999 for instance, NZF got hammered by voters for its liaison with National and it remained in Parliament only because Peters won his Tauranga seat by a slim 63 votes. Painfully, the party rebuilt itself. After a subsequent fling with Labour, Peters and his party were then banished from Parliament altogether in 2008. Again, NZF fought a successful comeback three years later.
This tumultuous history could be taken as a rationale for not entering into any coalition, with anyone. A confidence and supply (or abstention) arrangement with a minority government might also make NZF’s long term survival far more likely. Certainly, NZF would be better placed to join forces with a Labour/Greens government in 2020 if it hadn’t been in bed with National for the preceding three years.
That cross-bench possibility aside, you can make a plausible case for either an exhausted National administration or a novice Labour/Greens one being more ripe with opportunities for the wily old operator. Well, there’s only two more sleeps until we find out his decision. But afterwards, rest assured that we will all be treated to a stern lecture as to why the decision he reached had always been so very, very obvious.
Search Party, ruling
Fans of the excellent TV comedy Search Party (Alia Shawkat from Arrested Development as the lead, Millennials searching for meaning, Parker Posey as a cult leader in animal furs!) will know this show gets even the little details right. Like, for instance, its choice of a theme song: which is the “Obedear” track from the first Purity Ring album, Shrines.
Basically, this is a song about the resemblances between the human body and the natural world. That reference in the chorus to “ the sky is low” name-checks the Emily Dickinson poem of the same name. The poem is not entirely irrelevant to the position Winston Peters finds himself in:
The sky is low, the clouds are mean,
A travelling flake of snow
Across a barn or through a rut
Debates if it will go.
A narrow wind complains all day
How some one treated him;
Nature, like us, is sometimes caught
Without her diadem.
And as Purity Ring add, fluent men should be mindful of the direction in which they’ve set their rudder, all the way down to this useful advice to Peters contained in the bridge:
Oh my dreams come back to me
Oh my wrinkles build on me…