Childcare, criminal justice, and some ways of thinking about public ownership
It’s been a fortnight since my last round-up. I’m determined to pull these together more regularly (hopefully weekly), but life keeps getting in the way - and while I’m not paid to write this all up, it’s a bit of a challenge to find the time (as much as I enjoy it). This one’s a bit longer than usual!
Recent news: childcare, windfall taxes, and fiscal holes
For a strong piece on New Zealand’s system of childcare subsidies, check out this article by Michelle Duff. It shows how unaffordable New Zealand’s childcare system is, and to me the piece highlights how valuable it would be to integrate childcare into the public education system more fully - removing costs for families. (It would be important, I think, to provide funding for families who don’t want send their kids to daycare.)
Over the last fortnight there has been some debate in New Zealand about windfall taxes on companies that have done well out of covid (including banks, supermarkets, energy companies, and aged care providers). This was prompted by the release of a policy document from the Green Party on a windfall tax; have a watch of this strong interview with Green Finance spokesperson Julie-Anne Genter to find out more about the background and arguments.
In the UK, as with discussions around Auckland Council’s finances, there have been a few references to a “fiscal black hole”. This little segment with Newsnight’s Economics Editor Ben Chu is a powerful explanation of how this framing is misleading, and is often simply an attempt to pave the way (as in Auckland Council) for slashing services or selling them off.
Longer pieces: a Ministry of Green Works, austerity, and the defects of New Zealand’s criminal justice system
I enjoyed the chance to write a longer piece for a new NZ Herald series on ‘Rebuilding Better’ on a Ministry of Green Works and a national investment bank for New Zealand. I drew on a report, funded by FIRST Union, which I wrote with Jackie Paul on a Ministry of Green Works. I also spoke to people who used to work for the Development Finance Corporation, a past New Zealand development bank that wrote off loans where businesses met export targets or job goals. John Hunn, former head of the DFC between 1973 and 1986, told me that NZ’s wine, tourism, and kiwifruit industries were built up through DFC loans. He also told me that no politician had contacted him about the DFC since it was privatised in the late 1980s. It’s striking to me that the old Ministry of Works and the DFC have been written out of many accounts of New Zealand political and economic history. (If anyone can’t access this article, since it’s paywalled, send me an email at mxharris@gmail.com and I can share the text.) There are parallels here with arguments made by Mariana Mazzucato and others, who have written about the state’s role in building and funding innovation - and how this has been erased in accounts of industrial development that focus on individual entrepreneurial genius.
If you have 15 minutes, and you’re interested in the philosophy behind government cuts or what’s sometimes called “austerity” - this is an interesting interview with Clara Mattei on her recent book. Mattei argues that austerity has a longer history than is often acknowledged (people in UK political discussions often associate it with UK Tory policy in the 2010s) and different elements that seep into various aspects of policy. One challenge when austerity, or neoliberalism, are given these broader definitions is the line between these phenomena and capitalism itself starts to become fuzzier. But I found this interview insightful and interesting, and I am keen to read more of Mattei’s work.
If you’re interested in criminal justice, colonisation, or foetal alcohol spectrum disorder (FSD) - this is a compelling and harrowing account of Haami Hanara’s story and recent appeal. (Full disclosure: I provided some legal research for this appeal.) The courts and policy-makers are behind in addressing foetal alcohol spectrum disorder, and Hanara’s case - and this write-up - shows the devastating human impacts of that neglect.
Some ways of thinking about public ownership
Because of some recent correspondence and policy work (and after a small 10th birthday celebration of the excellent work of We Own It), I’ve been thinking about different kinds of public ownership policy. It was an area of policy that was central in UK Labour’s policy platform at the 2017 and 2019 elections, in sectors like energy, broadband, water, mail, and rail. (That is to say - UK Labour proposed reversing privatisations of rail, mail, water, broadband, and energy, and bringing these sectors into public ownership.) I thought I’d sketch out some concepts and distinctions here because I think it’s helpful to separate out some different kinds of public ownership.
One distinction is between sectoral and single-entity public ownership. This is the difference between an entire sector or industry being in public ownership, and the state having an ownership stake in just one company in that sector. UK Labour under Keir Starmer has proposed setting up Great British Energy, a single renewable energy company that will invest in renewable energy. This is an example of single-entity public ownership: a publicly owned company that has to compete in the market against other private providers, but is meant to provide some kind of market rudder or steer to change the behaviour of private providers. Another example is KiwiBank in New Zealand, a state-owned bank that still operates alongside large private banks. Mary Robertson’s excellent piece about Great British Energy explains the downsides of this model of public ownership. It may be difficult for market norms and behaviours to change significantly with just one entity in public ownership: as Robertson says, “an operator on its scale is unlikely to have much impact on wholesale prices.” Sectoral public ownership involves taking an entire sector out of the market. The 2019 UK Labour plan for full-fibre broadband infrastructure to be nationalised and rolled-out through a public provider might be an example: the broadband infrastructure market would have been entirely in public hands. Public healthcare systems might be seen as examples of sectoral public ownership, at least at the level of hospital care, though models differ in their coverage and approach to how much privatised healthcare can operate alongside public healthcare.
Another closely related concept is fee-free services, where the state covers the cost of a service but the service may remain in private hands. Recent discussions of fare-free public transport are an example: the underlying bus or train companies are not necessarily brought into public ownership, but there is no cost for using the service. Fee-free services operate best when they cover an entire sector: i.e. all of public transport is made free, rather than simply transport for one element of the servie. Universal basic services can sometimes refer to fee-free services or publicly owned fee-free services; a 2019 report I contributed to preferred to see universal basic services as fee-free and publicly owned. Also relevant in these discussions are not-for-profit services that are not in state ownership: examples include community broadband services, community-owned energy entities (like what was Robin Hood Energy in the UK). These often have to operate in a market, and may not have the scale or strength to challenge market forces.
These concepts and distinctions are quite stylised but I think it might be helpful to separate these concepts when they are sometimes bandied together under “nationalisation”. They rely on a narrow definition of ‘the state’. I have not explored much here different models of governance within publicly owned entities, which are an important part of the discussion. I’m interested in feedback on this - it’s very rough and ready - but I’ve tried to capture these concepts and distinctions in a table below:
Deb Te Kawa on Twitter has raised a good question about (my words, not hers!) how all this applies in the Aotearoa context, where there are questions about state legitimacy. This requires another post of its own, but it’s worth adding a few thoughts here about that context. First, all political action should be consistent with Te Tiriti o Waitangi. That means, second, that some resources and services (for example, energy) cannot be approached in the same way that they might be approached, say, in the UK - since Te Tiriti guarantees Māori tino rangatiratanga over taonga. Third, my view (consistent with one part of the Matike Mai report, I think) is that policy change towards public ownership should be thought of with the kāwanatanga and tino rangatiratanga spheres in mind. Fourth, relatedly, one possible way to reverse privatisations in a Te Tiriti-consistent way would be to bring those services into the kāwanatanga and tino rangatiratanga spheres, out of the market, allocating the resources and/or services across the spheres in the way that is demanded by Te Tiriti. As Deb notes, we also need to wrestle with the state as part of this discussion, including all of its historical and contemporary failings; one resource that I’ve found helpful is work on being “in and against the state”.
On a different note …
I really enjoyed David Farrier’s film Mister Organ, which I saw earlier in the week. It’s an unsettling and a brilliant depiction of psychological abuse, coercion, and manipulation. I was also very happy to see that Gabriel Winant’s book The Next Shift won the Deutscher Prize. It’s one of the books on my wishlist, along with Isabella Weber’s latest and this older collection on social reproduction.
Lastly, here’s a great cover of a Marcy Playground song that I remember doing the rounds when I was a kid - as with so many things I like, I don’t know how much of me liking the cover is nostalgia or that it’s all consolingly familiar, but I liked it all the same.