Tuesday, May 10, 2011

It’s the economy, stupid.

“Finance Minister Bill English says the govt deficit for the year is likely to be about $16 billion to $17 billion - the largest deficit New Zealand has ever had.”

And this government wants to run with Bill English’s handling of the economy as a “core” election issue!

Unbelievable.

This is the largest deficit any New Zealand govt has ever run. Ever. And they think it give them economic credibility.

That they do is one more reason to damn them.

Make no mistake, this economic disaster is not the result of a natural disaster. Things were already well out of control well before half of Christchurch was destroyed. It is not the result of things beyond this government’s control. It is precisely because this grossly irresponsible govt has made some very, very bad choices:

  • To swallow the dead rats that have now come back to bite us.
  • To smile and wave instead of knuckle down and do the right thing.

Roger Douglas is right. This sort of result is what happens when you put off dealing with problems in your first term for fear of scaring the horses.

But big as this deficit is—big enough even for ratings agencies and the IMF to notice—there is an even bigger deficit here, and that is the ability deficit of this Finance Minister and his Master—and of their opposition counterparts in Hard Labour.  Hard Labour’s David Cunliffe is right that Key’s men have no economic plan. But neither does Silent T. Nothing at all. Frankly, it’s beyond him too.

But it’s frankly not hard to know what has to be done. Not hard at all. It’s precisely the same recipe now as it was in 2008, only more so:

At this dangerously destructive point, you’d be stupid not to.

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10 Comments:

Anonymous Mort said...

Blenglish should step aside in the Clutha electorate. It is plain to see that he can't handle the rigours of a Ministerial post, and his inability to counter the machinations of Brash's ACT coup, clearly display his inability to even be viable against a worthy political opponent, all mean that he should just retire from politics, and go back to fiddling with what ever it is he fiddles with up in Karori, now that he isn't around sheep any-more.

5/10/2011 01:17:00 pm  
Anonymous Anonymous said...

As Brash has been saying: it's worse than 1991. It's worse than 1985. It's the worst situation NZ has been in ever.

Every single cent NZ flushes down the crapper on social welfare is borrowed. Ever damn cent of the dole, the DBP, the sickness. Every dam cent on "Childcare", Kindy, Primary, Secondary, Poly/Uni/Waananga.
Ever cent on GPs, on Specialists, on A&E, on palatial hosptial buildings.

Every cent borrowed, gathering around 10% interest, and has to be paid back one day.

NZ's nett debt is well over 100% of GDP and rising fast. And the current govt's plan: add another 20% each year.

There is a plan: it's the 2025 taskforce. It says what needs to be done. To make this plan happen - to save NZ as a soverign country, there is only one thing you need to do

PARTY VOTE ACT


With 20% of the vote, Simple&Wave will have to no choice to make Brash Minister of Finance, and then the plan can be put into action!

5/10/2011 01:22:00 pm  
Anonymous Anonymous said...

And as for the daft Libz plans:

As a matter of urgency, governments need to cut the fat – and there’s plenty of it in Helengrad:

... list of lefty boutique ministries...

“That’s just a few of the bureaucratic sacred cows that any responsible political party should have in their sights at such a time,” concludes Darby.

“It’s enough to make you vote Libertarianz!”


It's not enough to make anyone vote Leftertarians.

It's not enough to make any sort of difference to NZ's economy.

Frankly every single damn boutique ministry doesn't even add up to 1 Billion dollars per year.

What needs to be cut are the big-ticket items:

* super
* dole, dblp, sickness,
* health, from GP visits to specialist to hospitals
* education, from childcare to kindy to primary, secondary, and tertiary

And by "cut" I don't mean a "zero based budget" that still gives 5% for inflation! Or even a "zero based budget" that makes a 5% cut by a zero increase in nominal terms.

I mean a real ZERO BUDGET

Amount budget for expenditure in all those categories - ZERO

Once you've ZEROED all those categories - then it will be obvious to zero the boutique ministries, and a whole lot more besides: cops, fire service, all overseas diplomats etc.


And no, pathetic little Libz, I don't mean "zero the budgets, but sell assets to give bludger annuities" - I mean zero the budgets. I don't mean "Zero the budget but cut taxes" I mean Zero the fucking budget. Untill every damn cent of the debt is paid back, with full interest, there are no room for any tax cuts whatsoever.

Want a tax cut? or benefits? Go to Aussie where they can afford them. NZ, simply, cannot.

5/10/2011 01:42:00 pm  
Blogger James said...

Labours "stop asset sales" campaign is funny.They keep insisting that we are all better off if these things make a profit,totally ignorant of Bastiats "That which is seen and not seen in Economics".

5/10/2011 01:49:00 pm  
Anonymous Dirty Mind said...

Mort, I agree. Bill English should just retire from politics and go fiddling with his sheeps at his farm.

5/10/2011 01:56:00 pm  
Blogger twr said...

"But neither does Silent T. Nothing at all. Frankly, it’s beyond him too."

Well, they do have a plan. The "rich" have lots of money, so all you have to do is take it from them, and give it to the people who have none. Tada! Surely that's "fair" isn't it?

5/10/2011 03:27:00 pm  
Anonymous Richard McGrath said...

@Anon:

Didn't the leader of ACT and his girlfriend go on a taxpayer funded overseas trips, same leader which when confronted about it whined "But I was entitled!"

You want us to vote for that party?

ACT has some major credibility recovery to do first.

5/11/2011 07:30:00 am  
Anonymous Richard McGrath said...

@Anon:

Libz recognise that publicly funded welfare has to go. We know about the parlous state of the NZ govt's finances. The sooner people are released from the yoke of the welfare state the better.

But the result of generations of handouts and bludger families is that people are addicted to welfare. Libz would cut the superfluous PC ministries and departments immediately and then sell assets to privatise superannuation and benefits for the truly disabled.

Are you saying you would maintain crippling rates of tax despite it being extortion? So the means justify the ends?

Why not fuel a recovery by giving everyone a tax break?

And where does your 5% inflation come from? Would ACT continue inflating the money supply by printing worthless fiat money, or would it allow banks to print their own currency which they would need to back with gold or some other durable asset?

5/11/2011 07:39:00 am  
Anonymous Anonymous said...

Has anyone else noticed that when good, truly fiscal, economic conversations begin to be discussed as they are here; the left is ne’er to be found?

Are these the kids that failed socialist math?

KSKiwi.

5/12/2011 03:15:00 am  
Anonymous Anonymous said...

Didn't the leader of ACT and his girlfriend go on a taxpayer funded overseas trips, same leader which when confronted about it whined "But I was entitled!"


That party is over. The leader is no longer the leader, and isn't standing in the next election. The party is completely different to where it was a fortnight ago.

And at this election more than any other in the last 50 years, every vote will count. Every party vote for ACT that is. Voting for any other party is tantamount for voting for the continuance of communism in NZ.

But the result of generations of handouts and bludger families is that people are addicted to welfare.

So? Generations are addicted to alcohol, nicotine, and P. Will the Libz state provide those to addicts too? This isn't a moral issue: it is simple mathematics.

The short answer is: so what. All the government "assets" are needed to pay down the debt. Once that is gone, there isn't any goldmine to pay for annuities or benefits. There just isn't.

Are you saying you would maintain crippling rates of tax despite it being extortion? So the means justify the ends?

All NZ residents are complicit in the debt. All residents must continue paying to repay that. They've had the benefits: somehow defaulting on that is a moral hazard of the first order.

Stopping all benefits are enough to stop borrowing, but not enough to start paying back the debt.

Once benefits and government salaries are removed, a couple of million Kiwis will starve in the gutter. Because they are useless. That's where they belong.

5/12/2011 10:50:00 am  

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