It's no wonder that among the greatest rises in price inflation are those that come from government spending (see the graph at this post for example showing the similar US situation). Figures for the four months to the end of October show that total core crown spending in New Zealand grew 9.6 per cent in the first four months from the same period a year ago. "The culprits," notes Bernard Hickey,
are the big ticket items of health, social security, education and the core bureaucracy itself. Health spending rose 11.1% to $3.7 billion. We’ve seen big pay increases to nurses this year, and the effects of an ageing population are inflating spending there. Social Security spending rose 5.8% to $5.9 billion. That’s despite record low unemployment.
(Well, maybe it's not such a "record low," eh?)
But the most interesting one is core government services. That’s bureaucrats in the ministries in Wellington. That rose 7.7%.
Great. No wonder red tape and compliance costs are expanding exponentially. No wonder the always prescient Thomas Jefferson declared "The natural order of things is for liberty to yield and government to gain ground." No wonder he recognised that "a little rebellion now and then...is a medicine necessary for the sound health of government" ...