ACT should go down in a blaze of glory, taking the GCSB Bill with it

If ACT is going to die in 2014 anyway, it should jump on this grenade. Die in a blaze of liberal glory, killing the GCSB legislation at its third reading and forcing National to take the whole thing back to the drawing board.

There comes a point when you start wondering what the point of a small-"l" liberal party is if it won't step up when it could really make a difference.

Politics always involves compromises and trade-offs. Usually, no small party can really achieve much.

You can get some policy concessions after the election, and especially for the kinds of policies that your partner kinda likes anyway but on which it doesn't really want to lead the charge. After that, things are set. You know you don't have the leverage to do much else, and reneging on your partner spoils your chances of getting minor gains in the next coalition arrangement.

But sometimes an issue comes up that speaks to your party's core values, that wasn't anticipated at the time of the coalition arrangement, and that's coming through on a very thin majority. Thin enough where a one-vote defection from the coalition could actually change the outcome.

New Zealand is updating the legislation around its spy agency, the GCSB.

At the same time, it's considering legislation around telecommunications providers that would make it harder for New Zealanders to use strong encryption and impose burdens on New Zealand internet service providers to ensure that GCSB is able to hack into any communications channel.

I do not doubt that there were problems in the 2003 legislation and that a redraft was necessary. But surely there is no crisis so pressing that we cannot take the time to get this right. And it's important that we get this one right.

Supporters of the Bill assure me that the Bill actually strengthens oversight on the GCSB relative to the status quo. The Law Society seems to disagree, and everyone who knows anything about tech seems to be screaming blue murder. I weigh those pretty heavily. If the actual deal gives more power to GCSB with more nominal oversight, I'm pretty sure that's a bad deal.

But even if the Bill does strengthen things relative to 2003, it also forecloses the option to come up with something better. Sometimes, the best should be the enemy of the merely ok. At the same time as New Zealand is moving to expand the powers available to the GCSB, we are getting daily updates on just how bad things are in the US with the NSA. There's growing pressure there for reform. Today we read that the NSA may have been funneling tips over to DEA about drug smugglers. It's scandalous there, but this is the exact kind of capability that John Key wants to give to our GCSB: he wants to make GCSB's spying apparatus legally available to the police and to the SIS for law enforcement purposes, supposedly to save on some duplication of capacity costs that have never anywhere been specified.

There's an oversight procedure for it, but it isn't a normal limited judicial warrant for specific specified purpose and limited duration. We're also hearing reports from the UK that the NSA and the UK have been using their part of the partnership to route around each country's regulations against spying on its own citizens. The looser regs in the UK were valued by the NSA. I've been assured by someone who should know that this sort of thing doesn't happen here, but we were also assured it didn't happen in the UK.

The time pressure seems to have come from the Government's desire to retrospectively legalise the GCSB's illegal surveillance of Kim Dotcom to cleanse itself of that embarrassment. When I complain about this stuff to people I know in Wellington, they just can't see what the big deal is. We trust the government in New Zealand, the GCSB wouldn't do anything nasty, so what's the issue?

Well, we can't simply run a spy agency on trust. And we especially can't run it on trust when the Executive here seems determined to prove that they view journalists as the enemy. They've built such a culture within Parliamentary Services that folks there just automatically hand over reporters' phone records over to inquiries. I doubt that the Prime Minister's office directed them to do it, but look at the culture that our Prime Minister has encouraged within GCSB and Parliamentary Services and NZDF. They bend over backwards to do that which might please, legal or not. Those on the right who oppose this legislation like to point out that we might not like what happens when Labour gets its hands on a more powerful GCSB; I don't like it with John Key running it either!

ACT emphasises the importance of law and order. They're often right to do so. But the rule of law requires that the agents of law enforcement also be bounded in their powers lest they become tyrants.

A few patches to the legislation via a nullity preamble seem inadequate to the task here. The whole thing needs to be re-done, ground up, with substantial input from the New Zealand tech community. Instead of aiming for a good-enough patch, set up something we can be proud of. If the 2003 legislation is flawed, we've lived with it for a decade. Another six months isn't a big deal. The lost opportunity is a big deal.

What's the lost opportunity? In the midst of the biggest and most salient crisis of confidence in American cloud computing courtesy of the NSA disclosures, we seem to determined to absolutely kill any chance that hosts could wish to relocate to New Zealand and base services here. The American tech sector seemed to have a bit of a warm spot for New Zealand. We've got a great base foundation: decent patent law without software patents, free trade, easy migration for skilled individuals, and a time zone that makes working with California pretty easy. It's a great place to live with decent civil liberties. There's a civil libertarianism among the American tech community that makes New Zealand a pretty appealing place.

When we should be throwing out the welcome mat, putting up legislation demonstrating that while we take international security concerns seriously, we also put strict controls on our spy agencies such that NSA-style "we spy on everybody, all the time" could never ever happen here, we instead push hard to make our security apparatus at least as bad as that in the US. It's nuts.

I know that ACT's leader, John Banks, is far more conservative than liberal. But parts of the party, and especially the party's youth wing, have been able to pull him in liberal directions before.

I know there are people in ACT who'd say that the legislation isn't as bad as is made out and that the critics don't understand the law. I know I don't understand the law that well, and especially the incremental changes relative to 2003. For that, I look to the Law Society and to lawyers who care about civil liberties. They don't seem to think that the legislation improves things. But even if they were wrong and the governing coalition were right that nobody except for the governing coalition understands the law, that doesn't much help things where the very strong perception is that the legislation basically is a way of letting the NSA spy on everybody in New Zealand. What's the point of a tech firm's relocating to NZ if they believe that we're basically part of the NSA? Fix it from the ground up, with substantive input from the tech community, so that the legislation both protects civil liberties and is seen to do so.

If the strategic thought within ACT is that sticking with National gets them support to come back in 2014, just look at the betting markets. ACT is already predicted to die in the next election. There's a 61% chance that ACT returns zero electorate MPs in the next election. Unless they move from an expected 1.2% vote share to a 5% vote share, the Party has greater than a 60% chance of dying in 2014.

If you're going to die in 2014 anyway, jump on this grenade while you're doing it. Die in a blaze of liberal glory, killing the GCSB legislation at third reading and forcing them to take the whole thing back to the drawing board. It might make it harder to get into coalition with National next time round if you do get back, but it could also start drawing in votes from that part of the electorate that cares about civil rights and tech freedom but shrinks in horror from the thought of Russel Norman being anywhere near the Treasury benches.

If you can't do that, please have the courtesy to actually die in 2014 so that a liberal party might emerge. Lead, follow, or get out of the way, they say. Absent changes, ACT does more to prevent the emergence of a liberal party than to advance liberal values. GCSB and TICS is a great place to start if you've any intentions of leading.

Dr Eric Crampton is a senior lecturer in economics at the University of Canterbury. He blogs at Offsetting Behaviour.