Why do we have foreign investment in New Zealand?Labour has since adopted bans on foreign ownership as policy, and so it hit a recent episode of Radio New Zealand's "The Panel". The segment starts at 3:30; Stephen comes in around the 7:30 mark.
New Zealand is a great place to do business and there are lots of good opportunities to grow businesses and create jobs. To grow requires funds and so businesses either borrow money or issue shares in order to finance that growth. This requires someone who is a saver to lend the money or buy the shares.
However, the pool of savings in New Zealand is too small to fund this expansion and so we use the savings of people overseas who are willing to invest in a great place with great prospects.
That bigger world has a lot to offer us and every time we restrict foreign ownership we also reduce our access to the best knowhow that the world has to offer.
For every foreign buyer looking to buy there is a New Zealander looking to sell. By restricting or preventing foreign ownership we are preventing a fellow New Zealander from selling what they themselves own for the best that they can get.
New Zealand is a nation that values freedom and choice.
One of the cornerstones of our society is that we are all free to buy, sell and own land and businesses.
When we impose restrictions on some people in society we tread dangerously on that freedom.
When it comes to private businesses, assets and land it is odd to think that "we" own them. On the day before a New Zealand farm is sold to a foreign owner, I didn't own it and I had no right to say how that farm should be used.
The day after it is sold I still don't own it and I still don't have any rights to say how it is used.
The new foreign owner is also subject to the laws of the land just as much as the previous owner. If a piece of land is important for, say, access to a river or beach then that should be written explicitly into the title of the land. Who owns it is then irrelevant.
Those opposed to foreign investment and ownership need to think carefully about why they are so. Such opposition comes at a cost to all New Zealanders.
Labour has basically no chance in the 2011 election - less than 20% according to iPredict. Hopefully they don't get locked into leftie populism before their next serious shot at government. A Labour Party supporting civil liberties, redistribution through a negative income tax and free markets otherwise could be really respectable. Depending on how far they'd push the negative income tax, I could even imagine supporting it. Doesn't seem they're going that direction though.