We’ve got it pretty good here. Don’t we? There is a certain image of New Zealand that we all like to believe in: We’re clean, green, laid-back, resourceful, fair and inventive. We’re the plucky little battlers at the end of world, quietly working hard in our little slice of paradise. All good. Sweet as. No worries.
But is this really true? If it used to be, is still true today? Will it stay true? Here at The Wireless, we took a dive into some statistics that show us where we’ve been and where we are now, and raise some big questions about where we’re headed next.
Ah, 2001. Helen Clark is Prime Minister and Jenny Shipley leads the National Party. The first Lord of the Rings film is released. Australia holds the Bledisloe Cup. Zed wins Album of the year. New Zealand’s largest company, Fonterra, is formed.
And here we are in 2014. I don’t need to tell you about today do I? Look out the window. According to John Key during the election, New Zealand is on the cusp of something special. But are we really? Are we headed in a positive direction?
As you see, several trends are immeditately clear. Put shortly, we’re getting bigger, older and more more ethnically diverse, and when it comes to our trade patterns, we’re heading down a clear road called ‘Milk to China’. Let’s look at those changes now, thanks to the magic of gif:
We also found a few more interesting trends that are trickier to sum up so simply. Firstly, home ownership rates are at their lowest since 1951. One of the most effective ways to analyse housing affordabilty is to chart the ratio of median house prices vs median household incomes, and generally speaking 3x is a healthy figure. In 2001 New Zealand sat around 3, but today we’re at 5.18, with Auckland sitting at a shocking 7.21.
Another harder to sum up fact is this: levels of inequality are rising. Put simply, at the richer end, salaries have doubled over the last 30 years, yet have stayed largely static for the majority of New Zealanders. Between the mid 80s and mid 2000s this gap between rich and poor opened out wider than almost every other developed country in world. It’s estimated that New Zealand’s child poverty rates have doubled since the 80’s: currently 27 per cent of New Zealand children live in poverty.
But hey, at least we got the Bledisloe Cup back right?
In the next 15 years, New Zealand will begin a new era. By 2031 the last of the baby boomers will be hitting retirement age and the current generation of young Kiwis will have taken the reigns. We'll be the politicians, the business and community leaders. The decision makers. But what kind of country will we be inheriting?
Are we ready for an aging population? How are we gonna pay for that?
Those bloody baby boomers! Our parents’ generation are cool and all, but there are just way too many of them. By 2030 the number of over 65s will have ballooned to 21 per cent, almost double what it was in 2001. And aside from a surplus of knitting, this will affect us in two major ways: more old people means less tax payers, but at the same time it also means a lot more spending, on healthcare and superannuation. Current projections on government spending show increasing costs in those two areas quickly push up another significant cost – financing all the debt we will have to accrue to cover the gap between money in and money out. If current policies stay the same, by 2060 it’s projected that 65 per cent of all government spending has to go to healthcare, superannuation and debt-financing costs combined, compared to around 37 per cent today. Put simply, less income and more costs is a bad combo.
How will a more ethnically diverse population change our culture?
Now this isn't a problem like some of the others, more just an interesting change to watch happen. By 2030 the number of asian New Zealanders will have reached the same size as the Maori population, and will have nearly tripled since 2001. How will this alter our national culture? It's going to be fascinating to see.
How will we address the rising levels of inequality and poverty?
Like the looming aging population, this is a complicated issue without a quick fix solution. But like the aging population issue, it's very real and it will affect every one of us down the line.
Maybe it's time for a tough-love hard truth hit: The rosy, egalitarian idea we have that we are a fair and even country where everyone gets the same chances and opportunities is an outdated myth, and the longer we hold on to it, the harder these problems will be to solve. We need to take decisive positive steps - like raising minimum wages and working conditions, improving housing affordabilty and standards and providing good healthcare and education – if we don't want half of us living in slums and ghettos, with the crime and healthcare problems that come with them.
What if half of New Zealand lives in Auckland?
Part of the reason for Auckland's current housing crisis is that demand is so high. And demand is so high because everyone is drifting towards Auckland, especially the young. This creates two more puzzles we'll have to solve by 2030. How will all those people co-exist in such a tight space? How will the rural towns of New Zealand cope as the young drift away and the elderly are left behind in towns and areas that are slowly dying? For Auckland, we need to think boldly about moving up, not out, about improving infrastructure and public transport. And will we be left with a countryside full of ghost towns? Or will our small towns essentially morph into being large retirement villages?
Are we putting all our trade eggs in one basket?
The rise in the importance of our dairy industry has been drastic and stems from us finding eager trading partners in China. But there are those who worry that (excuse the mixed metaphor) as a country we're putting all of our eggs into one basket. Such a large proportion of our economy relying on one product to one market is a very risky strategy. One sudden change and it could all come crashing down with drastic knock-on implications for our whole economy.
There are many possible things that could make that happen. What if an outbreak of foot and mouth shuts down our dairy production? What if relations sour politically between New Zealand and China? What if China makes any kind of internal policy change that makes importing from us difficult? And what if another country from South America or Africa catches up to us in dairy technology and produces more at cheaper prices than we can?
Are we getting left behind in the technology race? Are we missing an opportunity for new industry?
While our population is growing, there are natural limits to how far we can go with primary industries for our main source of income – put simply, there are only so many cows and sheep and logging trees we can fit. Another part of our mythical vision of our national character is that we are smart and inventive and there are people, like the late Sir Paul Callaghan, who have been saying we need to live up to this and make more progress in innovation and technology. New Zealand is home to a small but growing number of highly successful companies making big impacts in unexpected areas: often highly sophisticated but niche technology products, like the massively profitable Fisher and Paykel Healthcare who lead the world in Sleep Apnea devices. Callaghan argued that while we'll never be big enough to take over large scale manufacturing sectors (we're never going to lead the world the world in making TVs for example), we are educated and resourceful enough to find innovative niches we can cater to.
Some say government should get this rolling by investing in research and development, while others say that should be up to businesses to fund for themselves. Either way, we should probably be thinking seriously about how to diversify our economy.
Are we forgetting to look after the environment?
Another key part of our image of ourselves is that we're clean and green. Our beautiful untouched forests, mountains and rivers are arguably our greatest asset and are usually front and centre of how we describe ourselves to the world: 100% Pure.
But are we taking our surroundings for granted? Are we actually looking after this place? As we've seen, we rely heavily on industry that revolves around our land, and it could be argued that piece by piece our government has slowly let profits come before preservation. Over the last few years we've opened up to sea-bed oil drilling, investigated mineral mining in National Parks, halted progress on sustainable energy sources and cut back heavily on funding to the Department of Conservation. What state will our environment be in by 2030?
And what about the state of the rest of the world?
As we can see, there are plenty of challenges ahead. It's a tricky enough road ahead right here, but what about the rest of the world? What if we get thrown off course by larger events outside of our control?
What if a large climate change event saw a massive influx of population? What if rising seas, severe droughts or species extinctions elsewhere mean New Zealand becomes a destination for millions of climate refugees? How would we cope with that? And on the flipside, what if falling oil supplies mean air travel is no longer affordable? What if New Zealand becomes cut off from the rest of the world in trade and tourism? And what if we have a zombie outbreak? (OK that last one is probably not happening.)
So what can we do?
Overall, this all might seem a bit doom and gloom, but there is another way to look at it. Like turning around a cruise ship, if we start early enough, we can change direction. The good thing is all these decisions are in our hands, and the best way to predict the future is to create it. If we can be realistic about where we are at, and be aware of the challenges ahead, then we have all the power to make the changes we need. All these worst case scenerios we are discussing is the New Zealand we'll get if we do nothing, but if we're prepared to speak up, to watch what happens around us, and be ready to change course when we need to we can build towards a 2030 to look forward to.
So first up, we simply need to ask ourselves: What kind of New Zealand do we want to inherit?
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