May 24, 2016

New Zealand the 51st State

Puerto Rico is the likely candidate for admission to the USA as the 51st state. But culturally, I would have thought one of the English common law countries were a better fit. Countries like Canada, Britain, Australia and New Zealand.

Why New Zealand? It's a fully unitary democracy, not a united kingdom or federal system. The other three from my list could not be easily amalgamated. Australia is made up of six states and further territories. Would each of these qualify for a star on the US flag? Probably.

So let's look at the case for New Zealand. It has a population about the same size as Kentucky and a land area about the same as Colorado. It has 99% literacy, is English speaking, though like the USA, English is not an official language.

Pros

1. Government and Law - it has universal suffrage and English common law prevails. The separation of powers is a strongly entrenched principle. It is not overly corrupt, the rule of law is respected.

2. Education - free education is guaranteed for all up to 20 years of age, and beyond that student loans are available for tertiary study. Education is encouraged.

3. Trade - free trade is the bedrock of its economy.

4. Economy - a free market capitalist system, private property rights.

5. Culture - similar culture to that of the western US states (particularly Oregon, Washington and California). 

6. Defence - fought on the same side in most major wars for the past 100 or more years.

7. Security - part of 'five eyes' and share Antarctica.

8. Travel - domestic travel between the countries, enhancing tourism.

9. Environment - national park system very similar.

10. Sports - both sides gain world champions.

Cons

1. Jones Act - NZ could end up like Hawaii, seriously crimping its style when it comes to shipping. In NZ a foreign vessel can pick up at one domestic port, drop the same cargo at another domestic port then head overseas on its journey. In the USA, that domestic shipping must be done by a US owned, crewed and US built ship.

2. Conflict of Laws - there are numerous ways laws can come in to conflict, but one that comes to mind would be prostitution. In NZ all pimping, soliciting, pandering etc is legal. Like Nevada but more so than that.

3. Guns - strict gun laws in NZ (however by comparison far more guns in NZ per head than in Europe). 

4. Cars - NZ drives on the left (RHD). USA drives on the right (LHD).

5. Measurement and standards - NZ is fully metric (though some imperial still remains) and standards are being merged with Australia. 

6. Maori - the Treaty of Waitangi 1840 is seen by Maori as a founding document. It is a treaty between the British crown and most Maori tribes. 

7. Sports - the black brand, silver fern and the mighty All Blacks (rugby union national team) would be lost, subsumed by the USA Eagles. 

8. Currency - NZers would lose a lot of value converting to US Dollars and the NZ economy as a whole would depend on US economic conditions. Why does this matter? NZ has had far less unemployment than other western countries.

How would this work?

On balance, the idea has legs. 

While NZers would lose value in their bank accounts, they'd gain back purchasing power. Businesses would get access to capital markets now largely closed to them. US industry could locate to NZ as it becomes a domestic producer (access cheap land, labour and resources). Agricultural output would access US markets securely, lowering food prices for the USA and increasing returns for NZ farmers, who in turn buy tractors from US manufacturers.

Cars could still be RHD, too difficult to switch sides of the road now. Broadcasting systems, where technology separates the two, would have to remain separate.

In practise, the NZ Prime Minister would become a Governor, the NZ parliament a state legislature. NZ would send four or so representatives to Congress, along with two Senators. The court system would become part of the US system. 

Where professional codes are applied, there could be a transition period, lawyers for instance, would not be required to retrain but new students would need to learn new cases. Accounting standards have already been internationalised, as have many professions.

And what of Australia? A little known fact is NZ is part of Australia, we're in their constitution as the seventh state. Given that free trade deals already exist, those would simply be replaced, either by a new one, or by one or the other. NZers would likely lose the automatic right to live and work in Australia, but gain the same right to the USA. So it balances.

What do you think?


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