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The Bottom Billion, H Clark and Maori

  • April 27th, 2009

I was interested to hear Helen Clark use the term "the bottom billion" in her parting comments. I recently read Paul Collier’s 2007 book of that name. I’m sure she would do the homework for her new job, but the book’s glowing reviewers would be pleased to know that she has read it. Many suggest that it should be compulsory reading for the world’s leaders and aid bureaucrats.

I wonder if it caused her to reflect on  the last three decades of Government efforts at Maori ‘development’. 

Collier’s book does not extrapolate his conclusions from nation-to-nation comparative statistical  analysis to the treatment of ‘bottom million’ ethnic groups within nations. Nevertheless the mechanisms may be similar, especially as members of failing groups tend to think and even call themselves ‘nations’ within nations.

I was thinking about all this as I read last week’s speeches of John Key and Chris Finlayson to the Te Kōkiri Ngātahi Treaty Settlements Hui.

New Zealanders invest so much hope in the settlements process. After 25 years of the industry it has become a matter of political necessity to complete it. Most of our political elite genuinely believe that redress for ancient grievance is a necessity and that it will help Maori. In John Key’s terms:

"I am impatient to see all Maori standing strong, economically independent and fulfilling their true potential.  I see the completion of historical Treaty Settlements as an essential part of achieving that.  Because only when the wrongs of the past have been addressed, will we all truly move our sights to the promise of the future." 

To stall the process now could be disastrous. But that does not mean that pious hope should lead us into thinking it is a substitue for reforming the welfare state, or part of the cure for Maori crime rates, or ill-health.

There is not much evidence from anywhere to sustain hopes that asset endowments work like that. War reparations seemed to have harmed some recipient economies more than those paying. And one of Collier’s most robust and depressing findings is that "natural resource wealth is an important part of the story of the poverty of the bottom billion".  

He reminds us of what was called "the Dutch disease" – the malady that the Dutch have only recently recovered from after North Sea oil and gas revenues made many of their other services uncompetitive.

But the problem is much worse for people with strong tribal traditions (i.e. without hard-wired cultural protections against corruption). That appears to be the case for Maoridom. For example, Tariana Turia is one of the more principled members of our Parliament yet we watched her embrace the Donna Awatere, and later Taito Philip Field after and seemingly because of the disclosures of their wrongdoing. My colour kin, right or wrong.

I’ve never forgotten a respected Maori National party leader telling us through the Dominion that we pakeha should get used to nepotism because that is the Maori way. David Lange’s only non-jocular comment to me about becoming an MP was in passing criticism of holders of Maori seats "I do not know that any of them is not venal".  

There are of course thousands of entirely decent Maori in leadership positions. But Collier’s thesis is that they are ousted in societies corrupted by the unearned wealth of resource rentals. It is not just that it is hard to learn how to hold wealth if you have not had the experience of growing it.

Unearned wealth must be managed, and the rents from it will go somewhere. It sucks a people into valuing distribution power – their brightest and best focus on the politics of controlling the taps. in-crowd politics does not reward the skills and values of engineers and scientists and service industry managers who know how to grow more for people who want to pay for the best or the cheapest.

Collier expresses it bluntly – "Resource rentals worsen governance. …The heart of the resource curse is that resource rents make democracy malfunction"

He argues that access to resource rentals in an ethnically diverse democracy results in "survival of the fattest" in political leadership. Embezzlers who are most prepared to be ruthless are the most likely to prevail in a patronage society.

Looking at Collier’s suggested remedies I hope Minister Finlayson and the Prime Minister set some absolute non-negotiables in their speeded up Treaty negotiations. Recipient institution probity, independent audit, and transparency to beneficiaries should be entrenched parts of their constitutions, irrespective of what the negotiating elite might claim to be insults to Maori values.



Perceptive comments. I don’t want to hi-jack your train of thought, but this sounds a lot like the effects of compulsory student membership on student politicians, too?
Back to treaty settlements… since it is taxpayers’ money, I’d expect the financial scrutiny to be up to the same standard as (sigh) govt accounts. Or better.

  • Jamie
  • April 30th, 2009
  • 7:10 am

I believe in freedom, including the freedom of the Maori people to have their own power structures and manage their wealth in their own way.

After all the crown entered into, or at least retrospectively acknowledged, a contract with the Maori communities. We as New Zealanders didn’t enter into an agreement with Maori individuals.

If Maori leaders fail to use their settlements wisely, then they are accountable to their people. If they aren’t accountable there is an imbalance in the Maori communities, just as there is an imbalance in our pakeha communities when we can’t hold Directors of failed finance companies properly to account…

Yes there are valid reasons not to pursue Directors, but why can’t you see that these apply to community leaders as well? There are risks and responsbilities with both.

Otherwise I agree with you mostly. The Dutch Disease is real and frightening, and has been the most terrible pandemic of the last 100 years…aided and abetted somewhat by economic imperialism and self serving masters of commerce. I would be interested in your analysis of unearned wealth in the context of housing and property speculation…

“Unearned wealth must be managed, and the rents from it will go somewhere. It sucks a people into valuing distribution power – their brightest and best focus on the politics of controlling the taps.”

Although I guess it perhaps speaks to itself if you can stomach applying the obvious metaphor to the banks.

[JAMIE – You ask “Yes there are valid reasons not to pursue Directors, but why can’t you see that these apply to community leaders as well? ”
There are valid reasons not to pursue for misjudgment, carelessness, lack of knowledge etc. Followers should bear the consequences of choosing leaders with those faults, not because the followers deserve or can necessarily prevent them, but because they give too wide a scope for political malice and too much reason for dud leaders to hang on to power to prevent being slaughtered and exposed for the inevitable mistakes that any person in any job makes.

But I draw a big distinction between foolishness and fraud, between incompetence or laziness and dishonesty or bad faith. We should ensure that directors and other leaders fear being destroyed if they are dishonest, if they abuse their powers for unlawful personal advantage.]

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