Thursday 20 February 2020

Giving SkyCity the convention centre was a very big mistake - Peter Singer edition

Another for the Eric was wrong file.

I had thought that the SkyCity deal was the least bad way of getting a convention centre conditional on the government wishing to be involved in paying to have a convention centre.

I don't think that governments should be involved in paying for convention centres.

And we should view the regulatory concessions granted to SkyCity in that deal as having an opportunity cost to the state equivalent to what those regulatory concessions would have been valued at had they been put up for auction. So while the SkyCity deal was meant to mean that the government didn't have to "pay" as cash payment, it did provide very valuable regulatory concessions. It wasn't free. People would pay a lot for the regulatory concessions that SkyCity bought? How much? Well, think about how much governments have to pay in other places to get convention centres built. It would be surprising if it were a lot less than that.

There are complementarities between casino operation and convention centre operation which could mean it would be less expensive to have the convention centre there. When I'd looked at that lit at the time, convention centres tied to or near casinos seemed to fare less badly than ones that were not. It can be part of the draw in getting some of the bigger conventions.

So I'd figured that the whole thing was the least bad outcome.

I hadn't reckoned on cancel culture coming to New Zealand, and the implications of that where a very important venue would be managed by an operator with incredible sensitivity to its perceptions of the social preferences of its various regulators.

SkyCity did secure some incredible regulatory abatement in its deal to provide the casino. But there are always a hundred margins on which the regulators could cause them to cease to be. Just how the money laundering regulations would be applied to them, for example, and at what kind of cost and stringency. How liquor licences will be handled in a venue where there is gambling going on and the effects of alcohol on continued gambling may be a concern. How the sinking lid policy on video lottery terminals would apply to their competitors, where they have some security on their own numbers - the worse for others, the better for them. Just what penalties and sanction might apply when they are not seen to have done enough about problem gambling. There will always be margins.

One hears incredible-sounding, but utterly utterly credible, stories about just what sorts of things companies operating under the shadow of the regulators here will get up to in attempts to buy the goodwill of the regulators. I'm not talking about payoffs or corruption or stuff like that. I'm talking rather about expensive measures taken expressly because they think it will leave the regulators with a warm feeling about them when next their particular regulatory issues come up for discussion.

I guarantee you it is happening in general.

And I suspect that that is what is driving Sky City's very very public campaign around inclusion and diversity. Everyone sees an incongruity between 'social justice' pushes and the company's core gambling business. It isn't incongruity, it's self-defence.

And so we get SkyCity's hair-trigger response to a minor amount of complaint about their hosting Peter Singer.

Disabled rights activists protested that Singer would be talking at SkyCity's venue. This sort of thing is rather common. But SkyCity cancelled him.

Danyl Mclauchlan covers it well at The Spinoff. I disagree with some of what he says but, unlike Singer's other critics, Danyl has read and understood Singer's project. I disagree with Danyl on two points - one minor to the case at hand, and one substantive.

On the minor point, I think it is important that Singer presents his arguments in the way he does because it forces the moral reckonings and thinking - the benefits of that outweigh the discomfort among those who choose to read him badly.

But the major point is a bit different.

Danyl argues that SkyCity is a private venue and should be able to choose who it hosts.

I agree with that. Every private venue and platform has to decide on what works for them, and what doesn't. A church hall should not be compelled to rent out its facilities for an erotica event, and a gay bar should not be forced to host a homophobic comedian just because it rents its facilities to other comedians. Property rights matter. And if the loss in future profits from hosting one particular event outweighs the profit of that particular event, that gives a way of weighing things. It speaks to effective demand.

But SkyCity they had a contract with Singer, and abandoned it under pressure.

I think that they abandoned it because they live in the shadow of the regulator. It is not a normal commercial decision. Even if SkyCity thought there would be zero consequence in attendance at their venue, they would fear the ill-will of the regulator.
"Oh, SkyCity. Yeah. We have to look at their renewals. What was that thing a couple of years ago where disabled people were furious with them? Like, what's wrong with them if they managed to make those people angry? Maybe we should look a bit more closely."
Avoiding that is the simplest explanation.

And it is consistent with other things SkyCity has been up to.

And it is also a very good reason that they should never have gotten the concession to run the Convention Centre. I hope that anyone considering booking anything with them for any reason will take very seriously the risk that SkyCity will cancel their event at the slightest pressure, because the regulatory risk they face will not be going away.

Does it seem plausible that cancelling Singer, who was to be talking about effective altruism and charity and the importance of doing the most good possible in the world, was a normal commercial decision?

Is it a free venue choice thing when they fear the hammer of the state? I don't really think so.

And it is a kind of a testable hypothesis. Here's the Masters thesis project, for those who choose to accept it. I bet the result would publish reasonably.
There exist company Corporate Social Responsibility rankings. How do company CSR rankings vary by the regulatory threats facing those companies and the industries in which they operate? You could use surprise state-level election results to identify effects for companies subject to state-level regulation, or changes in the composition of the relevant congressional oversight committees. 
I talked about some of this with Mike Hosking this morning.* Not about the broader potential research question, but about this particular instance.

It looks like Peter Singer's found another venue. In the interim, those keen might want to listen to my own chat with him in 2015 at the Christchurch WORD Festival. The link takes you to my post at the time that excerpted the best bits, including some fun around whether vegans should consider eating Canterbury lamb.

And if you get the chance to attend in Auckland, you should.

* Hosking introduced me as a member of the Free Speech Coalition. I'm broadly supportive of the Free Speech Coalition, as I am very much a fan of free speech, but I don't think I ever signed up with them. I don't really join things. I don't know whether my own position on this stuff corresponds with theirs, but I'd hope it does. And I don't keep close enough tabs on every position they've taken to necessarily endorse every bit of it. That's one reason I don't join things - it requires too much attention.

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