The Job Summit attendees certainly appeared to have big pay packets, but big ideas? They came up with 21 of them, predictable and so unimaginative that you do have to wonder if the leadership of our businesses are really up to the task of surviving a recession. Shareholders should be very scared.
The three big ideas
1) Nine day fortnight (on the presumption that it will be for the same pay).
2) A new organization to extend distressed businesses either more debt or equity to save jobs.
3) And a length of the country cycle way!
Only the second one has much merit but is an obvious requirement to stabilize the economy. The first has a bit and the last on the face of it is entirely laughable, or is it?
I have already commented on the first two more or less. I suggested that employers should introduce performance based pay and if labour cuts were required (redundancies) the workplaces should decide if they would prefer a wage cut, and if over production is an issue then of course time can and should be taken off. And we do have to wake up to the fact that our standard of living has to drop, economic standard that is.
I have also suggested encouraging the banks to extend credit, extending equity, in part by the crown, is another matter altogether. I can see Labour running Muldoon's 1975 campaign all over again, this could be a method of nationalising NZ business. You could form the view that this is better than foreign ownership as that may be the only alternative, unless we get our act together.
So this blog is about what at first blush looks like an unbelievably stupid idea... a cycle way.
In 1935, when Labour decided to build a four lane highway across Auckland's Hobson Bay and extend it all the way to St Heliers, it must have looked like the most stupid public works program ever conceived. Orakei was a Maori settlement, Mission Bay, Kohi and St Heliers were small beach settlements. A bit like what you now find on the northern shore of the Maharangi Harbour out from Warkworth.
A four lane highway, you had to be kidding. There were not even many cars going out to the bays along Remura and St Johns Road, and the commuters were served by a ferry service which ran out as far as Bucklands Beach.
There were bugger all commuters anyway even in good times (my grandfather was one such commuter living at the time in Kohi.) Sure, in better times picnic goers from town would go out to the eastern bays by ferry, but a four lane road, madness.
Seventy years on the road was not such a bad idea. It opened up the eastern suburbs to produce expansion land for the well to do as well as the less fortunate. In the 1950's Orakei was covered in state houses.
The explosion of cars now makes the four lanes look inadequate, especially since one of the lanes each way has been passed over in peak traffic to cyclists and buses exclusively, however cars still cheat.
But the real value of the waterfront road is its pedestrian use, it is now clearly a walker's paradise and has also opened up our harbour to shore based tourism. It will undoubtedly now have paid for itself in tourism dollars, health benefits and the expansion of housing.
But in 1935 with nearly 30% of our workforce out of work building something that was very labour intensive and used local materials gave a huge employment bang for each dollar spent. The guys building this road used picks shovels and wheelbarrows, and the fill for the reclamation was good old fashioned rock.
So in judging the cycle way plan you have to imagine what the future holds as the ultimate benefits of this could be enjoyed by our grandchildren and there is a high probability that they will enjoy it.
According to John Key it will cost around $50 million, small change compared to the broadband plan which we probably don't need either. Every dollar spent on the cycle way will employ NZ labour and use resources we have in NZ so the total spend will recirculate and give an immediate multiplier.
The broadband plan would be lucky to have 10% of the total spend using NZ resources and technology. John estimates that the cycle way will employee 4000 people, i.e. it will cost $125k to create one job. Seems like quite a lot but cement and stones don't come cheap. In terms of job creation and retention schemes, it is real cheap. Have a look at the US bailout packages relative to jobs saved and the cost is coming up at around US$300k per job saved.
But John having cycled all my life, and having been a commuter cyclist for over 15 years as well as having toured much of the North Island on a bike, the plan as formulated sucks. But you could make it much better.
Firstly, I am yet to meet a mountain biker who would have any interest at all in mountain biking on a prepared track. These guys are seriously off roaders, and believe it or not we already get a number of foreigners who come to NZ just to mountain bike our national parks and the like. There is already a mountain bike trail through the central north Island Plateau and it is well used, it doesn't need any money spent on it.
Touring bikers is who you are targeting with this plan. I am also yet to meet a touring cyclist who has had any interest in starting at the top of the North Island and doing the full 2000km from one end to the next, sure there would be one or two. The reason for this is that while NZ is very beautiful some of it is really worth missing, e.g., the Auckland to Hamilton stretch has little to recommend it, but Coromandel, Otago, the East Cape, Taupo, Rotorua, Taranaki and the King Country, Kaikoura and the west coast and the Katlins are all very beautiful.
But John when you do cycle fully loaded it is hard work to do more than 100km a day and you can't keep that pace up forever. On my last trip to Queenstown I sat next to an elderly US couple who were doing a tandem ride in Central Otago.
It was an organised ride. There were 70 couples meeting up, all their gear was in a bus and they were doing 60km a day and were doing it for 10 days. Most who might want to tour NZ will likely want to do a 500 to 600km scenic route. So John don't join the length of the country up, select say 10 top trips and create 300 to 600 km of touring cycling on each.
If you really want to get a bang for your buck think about commuting cyclists in the main cities, Go and visit Holland to see how they do it, and they have integrated the commuter cycle ways across the country. It's much smaller country and flat, however.
Having commuted in Auckland all this time, I have noticed that the numbers over the last two years in particular have started to increase. Ten years ago I would not see one other cyclist on my 25km ride into town each day, now I would pass or be passed by around 20 each way. When I talk to people about why they choose not to commute it is fear of traffic. So extending the cycle way network would in my view dramatically increase the number of cyclists.
This would be good for our balance of payments and would also improve health. A further observation, I have now noticed a new form of business has started in Auckland, cycle parks that include a coffee shop and showers, where you can store your bike for less than the cost of parking a car (a lot less) and have a shower as well. These would not exist unless there was demand. So John cycling is taking off.
But here is the big test for your commitment to either your plan or mine. To make this work in Auckland you will need to convince Transit to allow cycles on the Harbour Bridge. It was built in 1959 and still hasn't got a cycle way. I have illegally cycled over it once (30 years ago) and it was not a hard ride. It was not dangerous, even though we did it without warning the authorities. All the scare mongery that it would be too dangerous is just nonsense.
So John, increase your spend to $100m, test the plan with the Auckland Harbour Bridge, target high tourist areas for an extensive cycle way, build commuter cycle ways in the main centres, and in 60 years time it might look like money well spent.
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Which three first-fives would you have taken on the All Blacks' northern tour?