Bill’s Big Budget Blowout
Don’t believe any bullshit about Bill’s Big Budget tomorrow being a “zero budget.”
The not-so-comforting fact pointed out by Auckland-based business writer Yoke Har Lee
is the country is forecast to run its largest ever budget deficit tomorrow, estimated at around eight or nine per cent of gross domestic product of around NZ$16.7 billion (RM39.8 billion) for the year ending June 2012.
Largest. Ever. Budget. Deficit. In fact, nothing a “zero budget” at all.
But maybe, compared to other less responsible governments abroad, it’s still “fiscally prudent? Um, no.
Going by the Organisation for Economic Cooperation and Development's (OECD) yardstick, New Zealand's budget deficit puts it at near the bottom of the class with countries such as Ireland (-12.2 per cent of GDP), United Kingdom (-13.3 per cent) and the United States (-10.7 per cent).
The reason the Auckland-based Lee has to point this out in Malaysia’s New Strait Times instead of our domestic media is because she points out uncomfortable facts and makes a very uncomfortable major point, that
to prevent this slippery slide from a First World country into Third World position is to plug spending in some sectors. The biggest bleeder of the government coffers is social welfare expenditure which has risen to NZ$22 billion as at last year from NZ$16 billion in 2000.
There are about 320,954 people on benefits of whom 170,000 have made this a lifestyle choice for the last 10 years. Key's government is going to spend over NZ$500 million over the next few years to help break this cycle of multiple generations of a family being unemployed.
Is this additional expenditure efficient use of funds for a financially stretched government? Key has had the last three years to institute drastic reforms for social welfare. Instead, he has left the hard decisions till now…
John Key is not the only politician in the world in recent decades to put off the hard decisions about social welfare—an avoidance of the bleeding obvious that is now going to sink virtually everyone.
But he is the only one to have told the Wall Street Journal when he first took office he intended use these last few years to “grow the nation out of recession by improving productivity.” “You Can't Spend Your Way Out of the Crisis,” he told the Journal’s Mary Kissell, and he wasn’t going to try.
What a crock.
Contemplate that tomorrow as you consider the big-spending stewardship of John and Bill and Michael and Helen and Jenny and Bill and Jim and Bill and …
Labels: Budget and Taxation