At last we begin to see what the incoming Government might really do. Much of what has been said in the past few weeks and days have raised fears the fundamentals of a modern, market-led economy might be at risk. The package of policies announced yesterday do not appear to go that far. There is to be a return to state-led regional development to the tune of $1 billion a year, and a forestry planting programme ("a billion trees") and "significant investment in regional railways". These are all likely to add costs to the country - if they were investments with a measurable market return business would be investing in them - but they will likely not fundamentally undermine the economy.
The fundamentals are monetary and fiscal policy, in particular; a floating exchange rate; low inflation; open borders for trade; balanced budgets and low government debt; all to underpin an economy with open borders to goods and services of international quality at affordable prices. Those are the pillars of New Zealand's living standard today which is too easily taken for granted, even among the generation that remembers the economy Winston Peters has said he wants to restore.
Peters does not subscribe to any of the monetary and fiscal fundamentals. Yesterday's coalition agreement was a measure of how far the Labour Party might be able to stop him doing too much damage. Crucially, it appears the floating exchange rate is safe. Peters has not got the Singapore method of currency manipulation advocated in his election manifesto.
There is an agreement to "review and reform the Reserve Bank Act", which probably means no more than Labour's manifesto stated: an addition of a full employment goal to the bank's low inflation target. But the employment goal would not have a numerical target like inflation, the incoming Finance Minister, Grant Robertson, stated before the election.
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Most of the coalition agreements are token concessions to Peters. There is to be a feasibility study on moving Auckland's port to Northland, which will no doubt find more sensible solutions to the Auckland port's limitations. KiwiBank's ability to become the Government's banker will be "investigated" too. Foreign ownership of land will be subject to "strengthened" Overseas Investment Act rules and a register of foreign-owned land and houses will be kept.
These concessions are sufficiently vague to suggest little will change.
This will be a coalition government such as New Zealand has not seen before. No single party will be as dominant as those that have led all governments previously. That much was evident last week when Peters alone announced which parties would form the government and their respective positions.
The Greens have done a separate deal with Labour which regrettably cancels Auckland's east-west motorway link. Labour has agreed only to "work towards" light rail to the airport. There is an investment fund of $100 million "to stimulate up to $1 billion of new investment in low carbon industries by 2020". Little else in the Green deal is that specific.
The language of both agreements is more cautious and tentative than a prescription for change. If this is as daring as the coalition gets, the economy should not suffer too much harm.