Rod Oram: Now we can see our future


From Newsroom this report of good news prospects over the next decade or so for New Zealand, from Rod Oram, economist.KPMG

Rod Oram: Now we can see our future

Rod Oram

© Provided by Newsroom

Three big announcements this week heralded our healthy and profitable future. Those standing in the way, argues Rod Oram, are as out of step as the Think Big world from which they hail.

This was the week we saw the future – and it was good.

It is a healthy and profitable future of deeply sustainable harvesting of land and sea, of clean energy and of 21st century industries and transport.

Three announcements in three days heralded this future:

– The primary sector won the backing of the government for its sustainable farming roadmap, Fit for a Better Future. This has strong buy in from many in the sector and government for the transition to farming practices that help restore ecosystems, which in turn will earn higher premiums from customers.

This Newsroom report describes the announcement; this report from the Primary Sector Council describes the ecological and cultural framework for the strategy; this is the Council’s overall report and the government’s strategy in response; and this recent Newsroom column describes New Zealand’s role in this global revolution to regenerative farming.

– The great potential of the fishing and aquaculture sector was documented in this report from the Aotearoa Circle prepared by KPMG. Further evidence is offered by NZ Trade & Enterprise in a recent report on open ocean aquaculture.

– The closure of the Tiwai Point aluminium smelter opens up a pathway to 100 percent renewable electricity and zero-carbon industry and transport. They will be far more valuable, and less polluting, than the smelter’s production of aluminium.

The first two transformations will take a decade or so and the learning of many new skills in production and out in markets. But the capital investment will be modest. The third will take several decades and much capital. But the technology we need is increasingly economic and available. Transpower recently published this report on how we can develop such an electricity system.

One of the hardest transitions is for the people of Southland. The smelter has generated jobs and economic activity for almost 40 years. But the region’s GDP is some $6 billion a year, whereas the smelter contributed just $91 million in wages and $58m in local spending last year. There are plenty of new opportunities for Southlanders in all three transformations. They will deliver far more for them than the smelter did.

They can also take heart from Taranaki. It is acting boldly to embrace clean energy and new industries to more than make up for the demise of the oil and gas sector over the coming decades. Its over-arching plan is its 2050 roadmap. Two key components are its National New Energy Development Centre and its initiative on zero-emissions hydrogen as a source of clean energy.

Northland is also facing a similar challenge with the owners of the Marsden Point refinery signalling the end of production of fossil fuels. Instead it will likely become an importer and distributor of petrol, diesel and jet fuel from far larger and more efficient refineries overseas, as this Newsroom article describes.

The refinery and Taranaki can’t compete in their radically changing global sector. There is a glut of oil and gas from far cheaper places to explore, develop and produce fossil fuels. Moreover, the global sector is beginning to realise it will never sell all the reserves it has already found. For example, BP and Shell recently wrote off US$50b of assets because production and consumption trends and increasing competition from clean energy are diminishing their sector’s prospects.

The case for the smelter’s closure is different but equally conclusive. Thanks to the hydro-electricity it uses, it produces aluminium with a carbon emissions footprint one-third of the industry’s global average, according to Rio Tinto’s RenewAl brand pamphlet.

But problems arise from that for Tiwai Point: the industry average is skewed by use of coal-fired electricity in some plants; that leaves plenty of competition to Tiwai Point from hydro-powered plants elsewhere in the world with cheaper electricity than it uses; three of those plants are massive, modern and owned by Rio Tinto; it has great leverage over those electricity suppliers because they don’t have other customers to sell to whereas its electricity suppliers in New Zealand do.

Tiwai Point is the fourth of Rio Tinto’s four plants globally supplying its RenewAl brand. But Rio Tinto seems incapable of earning a tiny premium for Tiwai’s aluminium, which is superior in purity and carbon footprint, to cover the somewhat higher electricity costs. In today’s market conditions, Rio Tinto’s far bigger hydro smelters abroad can make up for the loss of supply from Tiwai Point.

Some people worry about the loss of the aluminium exports when the smelter closes next August. But they typically run at around $1b a year, depending on the global price of aluminium. That’s only just over 1 percent of total exports. Moreover, the smelter imports some $450m of alumina each year from Australia as its raw material. So the net impact on our trade balance is around a negative 0.5 percent of our total trade.

Remarkably little of the value the smelter has generated for its owners over the past 40 years has stuck to the ribs of the New Zealand economy. Given it’s a wholly-owned, toll-processing plant, its owners can profit elsewhere in their global value chains when conditions are right.

Conversely, the closure of the smelter is a benefit in terms of the ending of its 1.5m tonnes a year of emissions and the 1.3m free carbon credits a year it gets from the government, which at current prices are worth some $45 m.

Moreover, it’s a relief that Rio Tinto is closing the plant because it has long banked on its balance sheet hefty reserves to remediate the land the smelter has polluted. In the 10 years it’s been trying to sell the smelter, there were fears it would do so to a small, inexperienced and under-capitalised player which would not fulfil those responsibilities.

The worries about clean-up have been heightened by Rio Tinto’s failure to deal with a potentially toxic by-product of smelting which it stores in an old riverside paper mill at Mataura in Southland. The Environmental Defence Society recently filed for declaratory proceedings in the Environment Court seeking to force Rio Tinto to move the 9,500 tonnes of ouvea premix.

Also on the positive side, the 13 percent of the nation’s electricity supply the smelter uses will be consumed by others. This initially will likely reduce electricity prices slightly and delay the building of some new generating capacity.

But the lower prices will encourage a faster switch from fossil fuels to electricity for some industrial uses, such as milk drying. In turn, that increased demand plus a growing take up of electric vehicles will stimulate more investment in generation and in a modern smart transmission grid which can encourage small-scale, local generation and trading.

Short-term market signals alone can’t drive these essential and valuable transformations in energy, industry and farming. Astute strategies by businesses and supportive policies from government are essential. While many key players in business and politics are on to these vital tasks, others are still in denial.

For example, NZ First has killed the government’s programme to help the transition to a low emissions light vehicle fleet; and the National Party and the politicised Federated Farmers rubbished the Primary Sector’s strategy announced this week, even though the strategy is supported by all the sector’s associations and main co-ops and corporates.

Those politicians are just like the smelter and refinery — legacy assets from the Think Big era which are no longer fit for purpose. The economic case for moving on is crystal clear. So too is the political.

Just got a little more dangerous in New Zealand

In looking past the move to Level 1 response to the novel coronavirus, I was expecting New Zealand to reach the next dangerous moment when incoming international travel resumed, probably from Australia first. Read the rest of this entry »

Coronavirus in the USA: state of Masschusetts – versus – the federal government in Washington

From a special investigative report entitled “The virus’s tale” in the Boston Globe (31/05/2020) on the spread of the novel coronavirus in Massachusetts, this paragraph on attempts to get supplies of safety gear from China toward the end of March:

By Evan Allen, Bob Hohler, and Neil Swidey
May 30, 2020


Three times the state ordered massive shipments, only for federal agencies to divert them elsewhere. When (Governor) Baker finally managed to broker an arrangement with the owners of the Patriots (gridiron team) to deliver a major shipment from China, his staff instructed the National Guard and State Police to block any federal attempt to seize the shipment when the plane landed at Logan (airport).  And once the supplies were secure, the governor stood on the tarmac, choking back tears of exhaustion and relief.

Short text for image description.


Government and NZ likely not prepared for Level 3

The government’s stretch of level 4 past the holiday weekend is a no-brainer.  Read the rest of this entry »

Not enough testing to understand ‘community transmission’

My main criticism of the government’s response to the Covid-19 crisis is that they should have been more transparent from the start about their inadequate testing regime.  They should have said at the start they were not going to do enough testing to know adequately the extent of ‘community transmission’.   It’s important to realize that it is in the medium and long term that expanded, perhaps widespread, lack of faith in the government’s approach may surface because of this.  As we near the end of the first Level 4 period it will be interesting what they will say about expanding testing for community transmission, if anything.

It’s common sense to be universally testing workers in ‘essential activities’.  The obvious ones are those involved with the health system where exposure is more likely, and food store workers where great numbers of individuals will be turning up.  Sure, it’s a lot of work to test everyone of those but a person may have contracted the virus before symptoms occur, and more worrying, some may have contracted the virus and never display symptoms.  Both types being carriers and transmitters, but invisible and silent like in Edgar Allen Poe’s famous short story ‘The Mask of the Red Death’.  There’s too much ‘leakage’ in symptom only testing.  The government needs to explain why they are not doing enough testing (they know they are not doing enough testing). (*Note 1)

At risk of carrying on too long here, I’ll speculate about the usefulness of random country-wide testing, possibly doing a bit more in suspected more-vulnerable areas.  Just finding one person infected (perhaps even without symptoms) in an area would identify where normal multiple transmission expectation could result in exponential spread of the virus.  Without finding that person it might be just as dangerous to be out in that location as the areas identified as hotspots, but not know it.

Currently my thought about dangers to myself is that I’ll not want to go out after the lockdown ends, with return to Level 3 or Level 2, because not enough is known about community transmission.  And in particular going to the supermarket is going to seem the same in terms of danger, looking around the store, without confidence that community transmission is mostly understood (which it isn’t).


  • Note 1 – It isn’t only testing for community transmission where such ‘leakage’ would seem to be expected.  The term ‘self-isolation’ has doubt written all over it.  It’s actually good the few examples (in the hundreds identified by police) there have been in the first two weeks.  But with the end of Level 4 being discussed those numbers may grow over the next two weeks.  ‘Quarantine’ is a much different term and by defining the strict terms of quarantine now, the government is admitting the softness and expected leakage during our time of ‘self-isolation’.   The strictness of quarantine should keep open the discussion about greatly increased community wide testing.   It is interesting that only today (09/04) have they begun to explain the limitations of not doing enough when explaining the change to quarantine.  They should have explained that at the start three or four weeks ago in order to put off possible growth in resistance later.  The same discussion may soon arise over community testing limitations.

The Unsettling of America – presentation to SATRS seminar

The Unsettling of America          by Wendell Berry, 1977 (Sierra Club Press)

Gary Snyder, noted American ‘poet, essayist, environmentalist’, wrote on the back cover of this printing (2015, Counterpoint Press, Berkeley):

“This book is about culture in the deep, ripe sense; a nurturing habitat. With unwavering focus, Wendell Berry shows what we lost of our real human American potential when we lost our commitment to living well, in place, on the land.” Read the rest of this entry »

Bio of my father, Paul Keller; at request of the Prospect, Ohio Alumni Banquet in 2018

Paul Keller Bio

Paul (born May 30, 1908), along with older sister Esther, and brothers Claire and Charles, grew up in a Methodist minister’s family (Wesley Martin Keller and Cara Mae Ramey) which in those days meant being moved around to a different parish every two or three years.   I think Paul was born in Fostoria, and I remember him mentioning Georgetown, Ohio as well but don’t know other stops before Prospect.  It can be hard on a youngster moving around so much, so years later the Methodist Church modified this process. Perhaps for the boys, their frequent moving was a factor in them wanting to stay in Prospect after high school.  Esther moved away, tried New York as a singer, but soon came back and eventually settled into the music program of the Cleveland City Schools. Read the rest of this entry »

The church needs to be an agent of change

Following are the opening paragraphs of the regular column (April 2017) of Jim Stuart in ‘Touchstone”, the monthly paper of the Methodist Church of New Zealand.  Jim is a past minister of St Andrews on the Terrace in Wellington and is now retired in Christchurch. Read the rest of this entry »

The Terrifying Consequences of High-Tech War – Keith Locke

The Terrifying Consequences of High-Tech War

(A talk by Keith Locke to a seminar on “Just War?”, hosted by the NZ Christian Network, NZ Peace and Conflict Studies Centre Trust, Pax Christi and the Anglican Pacifist Fellowship,in  Auckland, 19 November 2016.)

The message of this talk is that war, as it becomes a more technological enterprise, is becoming even more barbaric with even less recognition that those being attacked are fellow human beings.

Perhaps we should start this discussion by going back a pre-industrial form of warfare, such as the tribal war between Maori before Europeans with their guns arrived on the scene.

On one level such tribal war was brutal, with one human destroying another human in hand-to-hand combat, and there were sometimes massacres. But the combat was on a fairly level playing field, although one side might get the advantage through having superior numbers, an element of surprise, or better fortifications. Both sides would commonly suffer significant casualties, which was one of the things pushing them to solve differences peacefully. Some tribes, such as the Moriori on Rekohu, became pacifist and rejected war altogether.

The biggest slaughter in Maori intertribal wars came when the technology went up a notch. Those who could get a large stock of muskets, like Nga Puhi, tended to prevail.

From that time on, through the 19th, 20th and 21st centuries the technology of war has advanced hugely, particularly in the Western nations. The killers were able to kill from an ever greater distance, without ever having to set sight on their victims.

The guns or artillery got longer and longer in its range, and then aircraft arrived with an ability to murder people en mass with their bombs and missiles.

The extreme of this was reached on August 6 1945, when a US plane, the Enola Gay, dropped an atomic bomb on the Japanese city of Hiroshima killing 140,000 and condemning many others to early deaths through radiation effects.

On one side 140,000 civilians were killed; on the other, American side, zero people were killed. All twelve crew members of the Enola Gay returned safely.

Read most of the reports of the Hiroshima bombing and you won’t see the crew of the described as psychopathic monsters for killing 140,000 innocent people, nor will you find much criticism of the man who ordered the mass killing, President Truman.

To this day you won’t find an American president admitting the obvious truth, that the nuclear bombing of Hiroshima and Nagasaki was wrong, although to his credit President Obama did go to Hiroshima last year to participate in a remembrance ceremony.

There are great ethical problems with the inconsistent way in which Western nations have treated the wartime killing of civilians.

It is easier to say “our side is right” and “the killing is justified” when you can’t see the victims, and into the bargain they are being demonized, or belittled as less civilized. And many in the Third World are so belittled by those in rich Western nations.

Or to put the converse, it is easier to say the other side (say ISIS) is wrong and brutal if you can see their killing close up, in all its horror, as in the videos of ISIS people beheading their victims.

Without in any way justifying the brutality of ISIS, it may be, when we look at UN figures, that in the areas ISIS controls more civilians have been killed by US bombing than by ISIS soldiers. But such statistics don’t register in Western nations because the blood spattered bodies resulting from US bombing are hidden away in “enemy-controlled” territory, whereas we see the results of ISIS killings on our TV screens. The unseen Iraqi civilians that might have died from American bombing are merely statistics, quickly dismissed as “collateral damage”.

It has suited the purposes of the United States, in the wars against Saddam’s Iraq and Gaddafi’s Libya, to simply not keep a tally of civilian casualties. It has been left to others to quantify it.

That raises another critical question. Is the killing of civilians from a distance, from the air, somehow less repulsive than a killing by a knife or bayonet?

Is the person in the cockpit, or the person putting in the coordinates for a missile, more civilized than the person armed with a bayonet on the front line? Those in control of the planes or missiles usually cause more death and injury, but somehow they are not seen as having blood on their hands.

Remote war becomes a computer game, and almost as sanitised.

Let’s now look at how the advance of technology is worsening this problem.

Firstly, let’s consider nuclear weapons. There is a certain public resignation to the continuing existence of nuclear weapons, and a certain complacency that they are unlikely to be used.

It’s partially true that since the end of the Cold War there is less danger of a nuclear war breaking out between major nuclear powers. But there are still several ways in which a nuclear war could begin.

Firstly, the US has not ruled out using nuclear weapons against a non-nuclear power, as we saw happen in 1945. Nor has Israel ruled out bombing a Middle Eastern nation, if it perceives its vital interests are threatened.  And we can’t trust the North Korean dictatorship not to conduct a first nuclear strike.

Secondly, when relations India and Pakistan reach crisis point, as they have in the past, there is no guarantee that one side, perhaps the weaker side, Pakistan, won’t resort to nuclear weapons.  Pakistan, also, is not the most stable or countries.

Thirdly, technological improvements have in some ways increased the danger of accidental nuclear war during a crisis between nuclear armed powers, such as Russia and America. The US has recently tested hypersonic ballistic missiles that travel at 5 times the speed of sound, which means, if my maths is correct, that they travel 100 kilometres in about one minute.  If Russia detected one of these missiles coming at them there would be little time for them to rationally decide whether it was a real missile or a false alarm and whether or not to respond. A nuclear exchange could begin, perhaps destroying much of the world.

We always have to remember that the whole nature of so-called nuclear deterrence rests on willingness of the leaders of nuclear states to launch a retaliatory strike. Just recently, the British Labour leader Jeremy Corbyn got into terrible trouble with the Conservatives, the UK media pundits, and most of his fellow Labour MPs, when he said he would not push the nuclear button.

Also, the continuing development of missile defence systems by the United States increases rather than decreases the nuclear danger by making it more likely that in a crisis an adversary will strike earlier and with more missiles to get through the US missile defence shield.

Conversely, the US could be more tempted to conduct a first strike if it thought its missile defence shield made it safe from retaliation.

Meanwhile, the technology of killing from afar continues to advance in non-nuclear warfare.

Higher precision killing using GPS is the most notable advance in recent years. The result has been a hugely one-sided form of warfare, whether done by aerial drones, or land and sea-based missiles.

Usually the missile or drone operators are so far away that their lives are not at risk. Whereas, for the targets, their lives are always in danger. Under the mantle of a “global war on terror”, the US gives itself the right to conduct drone missile attack in any country, with or without the permission of the government of that country. For example, drone strikes have occurred in Pakistan and Libya despite protests from the Pakistani and Libyan authorities.

This is all going against the restraints on war contained in the Geneva Conventions which envisage combat between armed combatants on a battlefield. To the US all the world is now a battlefield, and it reserves the right to kill any adversary, even when that adversary is not a soldier but rather an ideologue or a political leader.

When all the world is considered a battlefield, the dangers of killing civilians other than those being targeted is also substantial, as we have seen.

Many, many civilians have been killed as collateral damage in American drone missile strikes, in a way that contravenes much of the international humanitarian law designed to protect non-combatants.

This problem of civilian deaths is enhanced when the strikes are against targets about which the Americans have limited intelligence – mainly because they have no intelligence from the ground itself. American intelligence is pretty much all based on observation from the air, combined with information from intercepted telephone conversations.

Even worse are those drone strikes call “signature strikes” where the identity of the target is not known, but they appear to be acting like an adversary, or a “militant” in the West language of demonization.

It is death by alogaritm. If you present with certain characteristics you are killed.

A UN special rapporteur has rightly called the use of fatal drone strikes away from a war zone as illegal extra-judicial killing.

Just because the US government has endorsed such killing doesn’t make it legal. How can it be legal for a US president to be given the power to construct a secret kill list and order the killing of anyone, anywhere in the world, with not even the pretence of legal constraints? Now that power to kill anyone by drone, anywhere in the world, at any time, is to be entrusted to Donald J. Trump.

Let us look at another aspect of high-tech aerial war. It is usually very one-sided. Take the current war against ISIS in Mosul, Iraq. One side controls the air and conducts detailed aerial surveillance around the clock as well as monitoring all electronic communications. US planes can strike with precision missiles at short notice. It can prevent the ISIS fighting in the open, and stop it making effective use of heavy weaponry or tanks.

This huge technological imbalance between the two sides – or what could be called the asymmetric nature of the war – has driven ISIS to desperate measures, such as suicide soldiers driving truck bombs into the lines of the forces attacking them.

This technological imbalance and the desperation it causes also gives impetus to terroristic suicide actions against civilians – as we have seen in Bagdad and Paris.

Without justifying such terrorist actions in any way, we have to understand the mindset which produces them.

To some extent they are motivated by a perceived sense of injustice against the people these jihadists claim to represent. The Palestinian suicide bombers of earlier times thought they were justified in blowing up Israeli civilians because perceived the Israeli people as a whole to be against Palestinians. Occasionally, these days, Islamic Jihad in Gaza will send a rocket into Israel with the same rationale, or as retaliation for an Israeli drone strike on one of their people. Sending rockets into civilian areas is clearly a desperate terror act, which we cannot excuse. But that desperation among Islamic Jihad’s civilian supporters is only enhanced when they see a constant presence of Israeli drones in the sky overhead, never knowing when a missile might suddenly come their way.

In general terms, the advance of military technology helps the already rich and powerful states – who can afford such technology – to pursue their own agendas, and it weakens the ability of people in the poorer nations to resist.

Wars “won” by the massive use of Western air power and highly targeted bombing end up not only destroying so much of a country, but are also hugely destabilising. We’ve seen that in Iraq and Libya, and the same process is underway consequent to the massive bombing of Syria (by Russia and other nations) and in the Yemen (as a result of the Saudi bombing).

Bombing can weaken or destroy a regime, as we saw in the fall of Gaddafi’s Libya or Saddam’s Iraq, but the foreign victor’s interference in the moulding of a new body politic tends to exacerbate tensions between internal factions, widen sectarian differences, and generate new conflicts, often of a military nature.

ISIS may be militarily defeated but the political fault lines in Iraq – between Sunni, Shia and Kurdish factions – may be widened in the process.

Let’s go on to another aspect of our main topic, that is how big advances in weapons technology are affecting naval and ground warfare.

Coming on stream are science fiction weapons like railguns, where explosive projectiles are rapidly accelerated via electro-magnetic rails. According to the US Deputy Defence Secretary Robert Work railguns will be inexpensive and be of enormous use against airplanes, missiles, tanks – almost anything.

Another powerful new weapon, to be introduced by the US Navy, is a “directed energy” laser weapon which can hit anything in a line of sight.

And then there is the replacing of soldier roles with robots, often called “killer robots”, which can be fully automated aerial drones used close to the ground or they can be land vehicles like tanks.

It took me a while to get my head around this, but then I thought that anything is possible when we now have self-driving cars, that can somehow respond to multiple factors in the changing environment around them.

The United States is testing small one metre tall tanks, called a MAARS (a Modular Advanced Armed Robotic System). The remote controller can sit kilometres away and use the MAARS tank to conduct camera surveillance of a battlefield and to fire shells and grenades.

Russia has a full-size Armata T-14 tank with an unmanned remote-controlled firing turret. The tank still has 3 crew members to drive it, but this is being reduced to zero soon. Imagine a swarm of these fully robotized tanks coming at you, assisted in targeting by a swarm of small drones over the battlefield. The tanks and drones can be programmed to act in concert, choosing targets and firing with little or no intervention from operators away from the battlefield.

The idea that tanks, drones or other robots could autonomously make decisions to kill people is a horrendous idea. But that is where things are heading, given advances in pre-programming, artificial intelligence, sensor and collision avoidance technology, combined with a sophisticated networking of communications.

But what happens when the “unintended” happens and hundreds of civilians are killed by these autonomous weapon? The army’s defence would be, “we didn’t mean to kill them, we just made a computer coding error and it all went wrong from there.” You can see that there are big problems in applying the law to the use of killer robots, which is one reason why they should be banned.

There is now an active Campaign to Stop Killer Robots, whose global coordinator is a New Zealander, Mary Wareham. And some progress is being made.

At a UN meeting in Geneva last April 94 countries agreed to begin formal discussions about the problems with “lethal automated weapons system” or LAWS.

For me, any killing is inhuman, but I am even more repulsed by the remote character of much of today’s high-tech killing. Some of the killing is even more emotionless than a computer game, where at least the player’s hand is on the joystick.

There is absolutely no human connection between a computer programmer writing code to guide a killer robot and an Afghan whose family home might be blown up by that fully autonomous robotic device when it is put into operation.

And because high-tech weaponry is expensive and largely the preserve of the already rich and powerful nations, its use by those nations tends to preserve their dominance, and their wealth and power.

In our fight against militarism and war we should be conscious of the danger these new high-tech weapons pose and campaign strongly against their use.

January 24th, 2017


Intelligence and Security Agencies Review – response from Keith Locke

(Note: general permission previously granted by Keith Locke to publish his blog entries here.)

Keith Locke: Hard to spy gains from Five Eyes

[This article of mine was published in the New Zealand Herald on 15 March 2016.  It was in response to the report of Intelligence and Security Agencies Review, released on 9 March.]

The intelligence services report by Sir Michael Cullen and Dame Patsy Reddy sheds more light on the GCSB’s work with the Five Eyes network, but it also leaves several questions unanswered. Since the Snowden revelations there has been a concern that our Government Communications Security Bureau is involved in “mass surveillance”.  The Government has denied that it is. Read the rest of this entry »