www.oocities.org/ubinz/press/1999C03HeraldQuigganNZreform.html

NZ Herald, 3 Dec 1999 [NZPA]

SYDNEY - The Shipley Government's defeat meant New Zealanders had finally turned their backs on 15 years of failed radical free-market reforms, an Australian academic said yesterday.

Professor John Quiggin said it took voters five tries to do it, but the electorate had finally been able to give effect to its intentions in the ballot box.

Professor Quiggin, from the James Cook University economics department in Queensland, is a senior fellow at the Australian Research Council, a Government advisory body.

He said the failure of the economic restructuring begun by the Lange Administration in 1984 was evident.

Since then, gross domestic product had grown just 0.5 per cent a year, employment 1 per cent and labour productivity 0.5 per cent.

"Whether these figures are compared with the OECD average, or with New Zealand's performance in the 1950s and 1960s, they are very disappointing," he wrote in the Australian Financial Review.

"Nor is the outlook for the future much brighter."

Professor Quiggin said most observers, including a long-time fan of the New Zealand approach, the British weekly the Economist, agreed that the reforms had not delivered the hoped-for outcomes.

"Despite this, the Business Roundtable, backed by the few New Zealanders who have benefited from the reforms, is the last bastion of the true believers."

Lion Nathan chairman Douglas Myers, in advocating even more change, had suggested ignoring the zero-growth years and focusing on 1993-96, when GDP growth averaged more than 4 per cent.

"He does not mention that this growth rate reflected a cyclical recovery from the 1988-91 recession," Professor Quiggin said.

"If picking the best four years in every 15 were allowed, North Korea would be a miracle economy."

He said arguments over whether the reforms in New Zealand had worked and whether they should continue had been debated for the past 15 years.

"But even the glaring evidence of failure is insufficient to convince the true believers."