"Responsible"? They lie to you and assume you're too stupid to notice.

It's one of those rare occasions, this budget, when commentators have mostly taken the finance minister's own spin as a given and burrowed instead into the details. The result however is to ignore context, and to focus on the irrelevant to the exclusion of the important. That's why the finance minister is looking so goshdarned pleased: because her lies are going mostly unchallenged.

The finance minister tells you that this election-year budget contains "no sugar hits." That New Zealanders won't be bribed on election year with their own money.

That's a lie.

The small matter of a $450 million "emergency contingency fund" has been set aside "in a time-limited contingency" if the cork remains in the Straits of Hormuz -- betting, of course, as she does in her heroic forecasts, that the cork will at least be loosened, allowing a wee flutter when polls show it's needed. 

Yes folks, the true "emergency" being provisioned for is an election debacle. That's what the slush fund is for.

The finance minister also tells us repeatedly that she's being responsible.

That's why she's set aside "just over $1 billion" for unspecified "improvements" to KiwiRail. Which is of course a big win for Shane Jones and his friend Winston. This is their billion-dollar slush fund for the election, which is just over double the fund she's allowed for her own party.

Responsible?

It's also handing councils $400 million in “growth incentives” now while only walking slowly to bring council's rates under control. And this is only because the finance minister can't bring her own govt's costs sufficiently under control to allow the GST component of new housing to go to councils (the real growth incentive she was encouraged to enact).

Responsible?

As Michael Reddell observes (one of the few commentators to put his head under the bonnet with the proper focus, New Zealand remains among the advanced countries with the largest structural fiscal deficit -- which have got "materially worse" under this Government.

 

As the Taxpayers Union notes, "Despite branding this a 'responsible Budget,' Nicola Willis has today confirmed the Government will have borrowed more by 2029/30 than Treasury forecast just five months ago." Over a billion dollars more.

So have things got any better under this National finance minister rather than the last Labour liar? Has it hell.  Reddell again:

In the last full year Labour was responsible for core Crown operating expenses were 31.7% of GDP 

In 24/25 32.6% 

In 25/26 32.6% 

In 26/27 32.6%

Responsible, hell!

And of course, this Government went to the country promising "no new taxes." That's another long-term lie. 

The budget has announced three new taxes on banks and shareholders -- sorry, two "levies" and one "charge" -- that will of course immediately be passed on to customers -- "the Beehive can try to frame it as a levy on the big banks, but this new tax will be paid by savers and mortgage holders. It’s a sleight of hand."

So that's just yet more charges and "levies" to add to the other new taxes already whacking New Zealanders since the last election's promise of "no new taxes (Levy (n.) an officially imposed fee, tax, or penalty demanded by a government or organisation). The full list:

Road User Charges on Electric Vehicles (April 2024)
GST on Digital Platforms -- the "App" Tax (April 2024)
Trustee Tax Rate Increase to 39% (April 2024)

Offshore Online Casino Gambling Duty (July 2024) 

Increased ACC Levies on Electric Vehicles (2025)

Customs and Excise Goods Management Levies (April 2026)

Prudential Regulation Levy on Banks and Insurers (announced Budget 2026)

Company Shareholder Loan Integrity Rules (Budget 2026)

Thin-Capitalisation Changes for Foreign-Owned Banks (Budget 2026)

And finally, the promise of "returning to surplus" by 2029?

To use Michael Reddell's term, that's just vapourware:

Not only has the projected date for getting back to budget surplus (on the standard OBEGAL measure) kept being pushed back but the projected surpluses for 26/27 (the yearr today's Budget directly relates to) have worsened by more than 4% of GDP in 3 years (under both governments).

Responsible? They lie to you and assume you're too stupid to notice.

Co-Governance is still quietly bubbling away

Whether it knows it or not --whether by Coalition design or by bureaucratic subterfuge -- it appears that legal implementation for co-governance has been strengthened under this Government's term rather than diminished.

A recent post pointed out that the UN Declaration on Indigenous Rights, the underpinning that creeping implementation, was a poison pill quietly smuggled in with the Indian Free Trade Agreement (FTA ). It was Gary Judd KC who spotted the clause in the signed Agreement calling on the parties to "affirm" NZ's commitment to this race-base Declaration. As Judd notes this morning, this is an escalation on previous Free Trade Agreements with the UK, which called for the parties to "note" the commitment, and with the EU to "further note." 

This is not simply harmless playing around with words. In legal terms, as Judd himself notes, it is "a significant escalation."

And it's not the only escalation towards co-governance. 

Remember that what underpinned the moves made by Ardern's Labour Government towards co-governance -- towards sharing government power with tribal leaders -- was that UN Declaration. That gave legal strength towards their quiet moves towards what Elizabeth Rata calls "re-tribalisation."

In 2007, the position of Helen Clark's Government was in opposition. Clark was many things, but she wasn't stupid.

John Key was. In 2010, his Government sent Pita Sharples to the UN to "support" it. That "support," when ratified here, underpinned the Ardern Government's support for He Puapua and for every flavour of co-governance emerging since.

And then in 2023, Hipkins's Government moved from endorsing the UN Declaration to a commitment “to upholding the rights affirmed in the Declaration.” These weren't just a small change in words. As a result, the Hipkins's Government then sought advice “to support the drafting of a plan to achieve the ends of the UN Declaration in Aotearoa New Zealand.” Those ends, of course, called for "self-determination" for so-called indigenous people. As Judd explains it, this is when "Non-binding aspirations morphed into affirmed [legal] rights." Once the NZ Government regarded self-determination as a cornerstone of the UN Declaration it then meant tribal participation in government decision making.

As the New Zealanders who claim indigenous status are Māori and governmental decisions affect all New Zealanders including Māori, this means the New Zealand position had become one where Māori should have the right to participate in all or most decision making. That is co-governance between a democratically elected government for all New Zealanders and Māori. Māori protocols ensure they are represented by an essentially self-selected elite.

Words, in politics, are so much fluff. Words, in law, do matter. 

[B]y the affirmations of the declaration and New Zealand’s position, has confirmed that the UN Declaration has binding status (for that’s the meaning of affirm in legal parlance) with a double whammy by confirming New Zealand’s position when that position at the UN and in international law is the July 2023 position.

The Minister and MFAT officials may try to justify themselves by claiming that New Zealand saying in an international agreement that it is bound by the UN Declaration and committed to upholding the rights contained in it is not the same as acknowledging that it has binding effect in New Zealand but that is sophistry which will not wash.

For reasons given in [my earlier post], there is little doubt that the courts will take the affirmations for what they plainly are: New Zealand’s acceptance that the UN Declaration is binding such that its principles may be utilised in the interpretation of legislation and as influencing the common law.

As Rata says in her own post on this, "today's politicians [should] look closely at all re-tribalisation language." Especially if it is being smuggled in through political stealth.

Yes, it's Budget Day ...

 ... so to help journalists desperate for something to write about before the Budget comes down, here are some quotable quotes. Send a copy to your favourite columnist:

"The average ... family head will be forced to do twenty years’ labour to pay taxes in his or her lifetime."
    ~ James Bovard

"The average family pays more in taxes than it spends on food, clothing, and shelter combined."

    ~ Congressman Dick Armey

"If politicians were serious about day care for children, instead of just sloganising about it, nothing they could do would improve the quality of child care more than by lifting the heavy burden of taxation that forces so many families to have both parents working."

    ~ Thomas Sowell

"I think coercive taxation is theft, and government has a moral duty to keep it to a minimum."
    ~ William Weld

"A government debt is a government claim against personal income and private property – an unpaid tax bill."
    ~ Hans F. Sennholz

"Christmas is a time when kids tell Santa what they want and adults pay for it. Deficits are when adults tell the government what they want and their kids pay for it."
    ~ Richard Lamm

"Everyone wants to live at the expense of the State. They forget that the State lives at the expense of everyone."

    ~ Frédéric Bastiat

"Apparently, politicians can change the planetary climate, but they can’t fix the potholes, repair the drains, or balance their books."

    ~ Alice Smith

"The secret to balancing the budget is to remember that all tax revenue is the result of holding a gun to somebody's head. Not paying taxes is against the law. If you don't pay your taxes you'll be fined. If you don't pay the fine you'll be jailed. If you try to escape from jail, you'll be shot. Thus, I - in my role as citizen and voter - am going to shoot you - in your role as taxpayer and ripe suck - if you don't pay your share of the national tab. Therefore, every time the government spends money on anything, you have to ask myself, ‘Would I kill my kindly, gray-haired mother for this?’"

    ~ PJ O'Rourke

"The state is never accused of greed. There is no limit to what it may take from us. And those who live on what is taken in taxes are never accused of greed either. Greed is virtually identified with the "profit motive." We have no invidious term for the parasitic motive. The state and its clients are all but immune from moral criticism."
    ~ Joseph Sobran

"[There are dangers in] the disposition to hunt down rich men as if they were noxious beasts."     
    ~ Winston Churchill

"To tax the larger incomes at a higher percentage than the smaller, is to lay a tax on industry and economy; to impose a penalty on people for having worked harder and saved more than their neighbours."

    ~ John Stuart Mill

"When Barbary Pirates demand a fee for allowing you to do business, it's called 'tribute money.' When the Mafia demands a fee for allowing you to do business, it's called 'the protection racket.' When the state demands a fee for allowing you to do business, it's called "tax." 
    ~ Jeff Daiell

"There are people who think that plunder loses all its immorality as soon as it becomes legal. Personally, I cannot imagine a more alarming situation."
    ~ Frédéric Bastiat

"Taxation is far greater an evil than theft. It is a form of slavery. If you cannot choose the disposition of your property, you are a slave. If you must ask permission to work, and/or pay involuntary tribute to anyone from your wages, you are a slave. If you are not allowed to dispose of your life (another way of defining money, since it represents portions of your time and effort, which is what your life is composed of) in the time, manner and amount of your choosing, you are a slave."

    ~ Rick Tompkins

"Taxation of earnings from labor is on a par with forced labor. Seizing the results of someone’s labor is equivalent to seizing hours from him and directing him to carry on various activities."

    ~ Robert Nozick

"The man who produces while others dispose of his product is a slave."
~ Ayn Rand

“Taxation is the price we pay for failing to build a civilised society, since taxation represents force.”
    ~ Mark Skousen

"The bureaucrat’s first objective, of course, is preservation of his job – provided by the big-government system, at the taxpayers expense. … Whether real world problems get solved or not is of secondary importance. It doesn’t take much cynicism, in fact, to see that the bureaucrats have a vested interest in not having problems solved. If the problems did not exist (or had been invented), there would be no reason for the bureaucrat to have a job.”

~ William Simon, former U.S Treasury Secretary

"… thou shall not steal, even by majority vote …"

    ~ Gary North

"In levying taxes and in shearing sheep, it is well to stop when you get down to the skin."

    ~ Austin O’Malley

"Public works are not accomplished by the miraculous power of a magic wand. They are paid for by funds taken away from the citizens."

    ~ Ludwig von Mises

"A [tax loophole is] something that benefits the other guy. If it benefits you, it is tax reform."

    ~ Russell B. Long

[S]tatism is but socialised dishonesty; it is feathering the nests of some with feathers coercively plucked from others – on the grand scale. There is no moral difference between the act of a pickpocket and the progressive income tax or any other social program."

    ~ Leonard Read

“We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle”
    ~ Winston Churchill

"Taxation without representation is tyranny."
    ~ James Otis

"Taxation WITH representation ain't so hot either."
    ~ Gerald Barzan

"If taxation without consent is not robbery, then any band of robbers have only to declare themselves a government, and all their robberies are legalised."

~ Lysander Spooner

"When a new source of taxation is found it never means, in practice, that the old source is abandoned. It merely means that the politicians have two ways of milking the taxpayer where they had one before."
    ~ HL Mencken

"The only difference between a tax man and a taxidermist is that the taxidermist leaves the skin."
    ~Mark Twain

"Government's view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidise it."
    ~ Ronald Reagan

"According to the Tax Foundation, taxes now consume more than 38% of the average family’s budget. That is more than is spent on food, clothing, housing, and transportation combined. Compare this to the plight of medieval serfs. They only had to give the lord of the manor one-third of their output — and they were considered slaves. So what does that make us?"

    ~ Daniel Mitchell

"Death and taxes are inevitable; at least death doesn't get worse every year."
    ~ Will Rogers

"When more of the people's sustenance is exacted through the form of taxation than is necessary to meet the just obligations of government and expenses of its economical administration, such exaction becomes ruthless extortion and a violation of the fundamental principles of free government."
    ~ former US President Grover Cleveland

"Rulers do not reduce taxes to be kind. Expediency and greed create high taxation, and normally it takes an impending catastrophe to bring it down." -
    ~ Charles Adams

"We have a system that increasingly taxes work and subsidises non-work."

    ~ Milton Friedman

"When you subsidise poverty and failure, you get more of both."

    ~ James Dale Davidson, US National Taxpayers Union

"The mounting burden of taxation not only undermines individual incentives to increased work and earnings, but in a score of ways discourages capital accumulation and distorts, unbalances, and shrinks production. Total real wealth and income is made smaller than it would otherwise be. On net balance there is more poverty rather than less."
    ~ Henry Hazlitt

"The poor of the world cannot be made rich by redistribution of wealth. Poverty can't be eliminated by punishing people who've escaped poverty, taking their money and giving it as a reward to people who have failed to escape."
    ~ PJ O'Rourke

"A government with the policy to rob Peter to pay Paul can be assured of the support of Paul."
    ~ George Bernard Shaw

"There cannot be a good tax nor a just one; every tax rests its case on compulsion."

~ Frank Chodorov

"Freedom is the quality of being free from the control of regulators and tax collectors. If I want to be free their control, I must not impose controls on others."
    ~ Hans F. Sennholz

"There's only one way to kill capitalism--by taxes, taxes, and more taxes." -
    ~ Karl Marx

"The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation."
    ~ Vladimir Lenin

"Giving money and power to government is like giving whiskey and car keys to teenage boys."
    ~ PJ O'Rourke

"A society of sheep must in time beget a government of wolves."
    ~ Bertrand de Jouvenel

"The power to tax involves the power to destroy."
    ~ former US Supreme Court Justice John Marshall

"Taxes are not levied for the benefit of the taxed."
    ~ Robert Heinlein

"Taxes are the sinews of the state."
    ~ Cicero

"Government is the great fiction, through which everybody endeavors to live at the expense of everybody else."

    ~ Frederic Bastiat

"Be wary of strong drink. It can make you shoot at tax collectors, and miss."
    ~ Robert Heinlein

Does Demand Create Supply?

Amongst the first reactions when Nicola Willis announced a coming cut in Wellington's bureaucrats came the outcry that the reduced consumer spending by those unemployed grey ones will keep Wellington "at the bottom of the pack in terms of things like economic activity," their reduced demand leading (so it's said) to a downward spiral.

The most cited author of that premise is alleged economist Nick Brunsdon, who seems to labour under the illusion that economic causality can be reversed, that demand induced by govt deficits somehow creates its own productive supply -- that if government keeps on over- spending and injecting new money into the economy, then productive wealth will follow. Fortunately, Frank Shostak is here in this Guest Post to dispel that destructive illusion ...

Does Demand Create Supply?

by Frank Shostak

By popular thinking, increases in demand cause economic growth. According to such thought, whenever the economy falls into a recession what is required is to strengthen demand. Since government is seen as an important part of total demand, what is then required is to increase government outlays, thereby lifting overall demand and hence increasing economic growth.

According to the popular view, it is also possible to strengthen overall demand through the inflationary increases in money supply. With more money in their possession, and for given prices, the so-called real balances will increase and this, in turn, will strengthen individuals’ expenditure on goods and services. This allegedly will strengthen the economy’s overall demand and will strengthen economic growth. A decline in the prices for a given money supply will also boost the real balances and thus the economic growth. 

But does it make sense that demand is the key driver of the economy?

In the free market economy, wealth-generators do not produce everything for their own consumption. Part of their production is used to exchange for the products of other producers. Hence, in the free market economy, production precedes consumption. This means that something is exchanged for something else. This also means that an increase in the production of goods and services sets in motion an increase in the demand for goods and services. According to David Ricardo,

No man produces but with a view to consume or sell, and he never sells but with an intention to purchase some other commodity, which may be immediately useful to him, or which may contribute to future production. By producing, then, he necessarily becomes either the consumer of his own goods, or the purchaser and consumer of the goods of some other person.

An individual’s demand is constrained by his ability to produce goods demanded by others. The more goods that an individual can produce, the more goods he can demand.

Expanding Private Savings: Key to Economic Growth

Without the expansion and the enhancement of the production structure, it is difficult to increase the supply of goods and services. The expansion and enhancement of the production structure hinges on the expansion of production, private saving, and capital investment. Saving supports individuals in the various stages of production. It supports individuals that are employed in the enhancement and the expansion of the production structure. Hence, what matters for economic growth is not just tools, machinery, and labour, but saving and investment in capital goods.

Government Is Not a Wealth-Generator

Contrary to popular thinking, the government does not produce any wealth. Increases in government spending cannot grow the economy. By nature, the government must take from the private, productive economy to facilitate any of its actions. By doing this, the government weakens the wealth-generating process and undermines prospects for economic recovery during a downturn. According to Murray Rothbard,

Since genuine demand only comes from the supply of products, and since the government is not productive, it follows that government spending cannot truly increase demand.

Likewise, an increase in money supply only sets in motion an exchange of nothing for something. This means a weakening in the process of wealth formation and leads to economic impoverishment.

An important factor that makes the fiscal and monetary stimulus appear to “work” is if the amount of private savings is large enough to support non-wealth generating activities while still permitting a growth rate in the activities of wealth generators. It also gives the appearance of wealth as new sectors are stimulated. Additionally, if funded by inflation, the benefits of inflation appear early and are only realised later.

If, however, voluntary saving is declining, then, regardless of any increase in government spending and inflation by the central bank, overall economic activity cannot be revived. In this case, the more the government spends, and the more the central bank inflates, the more will be taken from wealth-generators, thereby weakening any prospect for a recovery. Additionally, these measures will further distort the economy.

As one can see, not only does the increase in the expansionary fiscal and monetary policies not raise overall output, but, on the contrary, it leads to a weakening in the process of wealth generation in general. According to Jean Baptiste Say,

. . .the only real consumers are those who produce on their part, because they alone can buy the produce of others, [while]. . .barren consumers can buy nothing except by the means of value created by [actual] producers.

Conclusion

By popular thinking, increases in government spending and central bank inflation strengthens the economy’s overall demand. This, in turn, sets in motion increases in the production of goods and services. What we have here is a claim that “demand creates supply.” However, to be able to exchange something for goods and services, individuals must first have something that others want. This means that, in order to demand goods and services, individuals must produce something useful first. Hence, supply drives demand and not the other way around. Governments, by nature, must take from the private, productive sector in order to fund their activities. Increases in government spending and the money supply growth rate results in the diversion of savings from the wealth-generators to non-wealth-generators, thus undermining the wealth generating process.

* * * * 

Frank Shostak is an Associated Scholar of the Mises Institute. His consulting firm, Applied Austrian School Economics, provides in-depth assessments and reports of financial markets and global economies. He received his bachelor’s degree from Hebrew University, his master’s degree from Witwatersrand University, and his PhD from Rands Afrikaanse University and has taught at the University of Pretoria and the Graduate Business School at Witwatersrand University. Frank’s publishes frequent posts on economics and the markets on his Substack page.

His post first appeared at the Mises Wire.

Let's just save time, shall we

 

Cartoon by Tom Fishburne

"It's not just a case of governments doing more with less. It's about governments doing less with less."

Since it's Budget Week again, here's my helpful compilation of quotes to help journalists looking to spice up their budget-week blogs and broadcasts. (You're welcome.)

Cartoon by Nick Kim

“Taxation is just a sophisticated way of demanding money with menaces.” 
    ~ Terry Pratchett 

"To steal from one person is theft. To steal from many is taxation." 
    ~ Jeff Daiell 

"I don't know if I can live on my income or not — the government won't let me try it."
    ~ Bob Thaves

"The best things in life are free, but sooner or later the government will find a way to tax them."
    ~ Anon.

"A fine is a tax for doing something wrong. A tax is a fine for doing something right."
    ~ Anon.

"Taxation is the price we pay for failing to build a civilised society. The higher the tax level, the greater the failure. A centrally planned totalitarian state represents a complete defeat for the civilised world, while a totally voluntary society represents its ultimate success.
    ~ Mark Skousen

“For every benefit you receive a tax is levied.”
    ~ Ralph Waldo Emerson 

"It's sad to realise that most citizens do not even notice the irony of being bribed with their own money." 
    ~ Anon. 

“The art of taxation consists in so plucking the goose as to obtain the largest possible amount of feathers with the smallest possible amount of hissing.” 
    ~ Jean Baptiste Colbert 

"There are no taxes which have not a tendency to lessen the power to accumulate. All taxes must either fall on capital or revenue. If they encroach on capital, they must proportionably diminish that fund by whose extent the extent of the productive industry of the country must always be regulated; and if they fall on revenue, they must either lessen accumulation, or force the contributors to save the amount of the tax, by making a corresponding diminution of their former unproductive1 consumption of the necessaries and luxuries of life. Some taxes will produce these effects in a much greater degree than others; but the great evil of taxation is to be found, not so much in any selection of its objects, as in the general amount of its effects taken collectively."

    ~ David Ricardo

"See, when the Government spends money, it creates jobs; whereas when the money is left in the hands of Taxpayers, God only knows what they do with it. Bake it into pies, probably. Anything to avoid creating jobs." 
    ~ humorist Dave Barry 

"When the ... government spends more each year than it collects in tax revenues, it has three choices: It can raise taxes, print money, or borrow money. While these actions may benefit politicians, all three options are bad for average [workers]."
    ~ Ron Paul

"If taxes and government spending are both slashed, then the salutary result will be to lower the parasitic burden of government taxes and spending upon the productive activities of the private sector."
    ~ Murray Rothbard

"It's not just a case of governments doing more with less. It's about governments doing less with less. When that realisation dawns, we may discover that most things the government can do, we can do better and a whole lot cheaper."
    ~ William Weld 

"I’m all for reduction of government expenditures but to anticipate it by reducing the rate of taxation before you have reduced expenditure is a very risky thing to do."
    ~ F.A. Hayek

"The real goal should be reduced government spending, rather than balanced budgets achieved by ever-rising tax rates to cover ever-rising spending."
    ~ Thomas Sowell

"To act within the marketplace, but not to be governed by the values of the market-place, is a considerable personal discipline."

"A customer acts within the framework of commerce. An audient acts within the framework of a listening community. When a musician believes that musicking is a commercial activity, the music dies inside them.

"To act within the marketplace, but not to be governed by the values of the market-place, is a considerable personal discipline. To see the audient as consumer denies them their humanity. They become a purchasing unit. Our human interaction ends with the completion of the transaction. When musician & audience combine to bring music flying into our world, to be parents to the music, life begins again.

“'Audient' is a description, not a label."

~ Robert Fripp from his Diary - April 15th. 1999

More mismanagement, please, ministers demand

"More mismanagement please," insists Minister

In 2002 Sandra Lee's Local Government Act took the shackles off local government, and gave them written permission to build monuments and to blow out budgets. Her Act reversed the legal principle that governments may only do what they are legally empowered to do, and instead said they could do what the hell they like unless there was a law to stop them. And so budgets were blown out, monuments were built, and everyone forgot what councils had been originally constituted to do: i.e, that boring stuff like looking after pipes in the ground.

Then in 2010 Rodney Hide super-sized Auckland's Council, and debt ballooned from around $1 billion in total for the 8 councils smashed together (mainly from Manukau and Auckland) to a figure of nearly $15 billion now. And the mandarins heading the new super-sized council immediately added a whole new layer of super-sized egos to run it, or try to, literally hundreds of new six-figure staff there to attend bigger meetings and build bigger monuments. 

So what lesson do you think the Ministers for Resource Management Reform and Local Government, Chris Bishop and Simon Watts, draw from this? 

Are they to insist, in their last few months of government, that Sandra Lee's Local Government Act be reversed, and councils required to go back to their knitting? Back to a better focus, to those pipes in the ground and on the rubbish on the streets?

Not a bit of it. Instead these idiots are insisting that all councils take lessons from Auckland's monumental disaster. In what appears to be a last-minute lurch to a headline, they have given councils three months (just this side of the election) to come up with proposals to merge themselves out of existence, and those that do not will have mergers chosen for them by Messrs Watt and Bishop.

And all this while Bishop is making a bollocks of his RMA replacement.

We are led by donkeys. In politics, anyway.

UPDATE: And to reinforce the issue, here's the most recent headline on Auckland's local governance: 

'Nerves on edge as Auckland Council finalises record rate rise in cost of living crisis.' 

What sane person would look at that and say: "Let's have more of that around the country?"

It takes a minister ...

"New Zealand is planning for a climate future scientists now reject"

"New Zealand is planning for a climate future scientists now reject. And fixing it will require more than a policy tweak.

"New Zealand’s coastal climate change planning system is built on a simple legal standard: councils must plan for the likely effects of climate change, using the best available evidence [sic].

"[And] across the country, planning is being anchored to a future that scientists now say is implausible—and, legally, should never have been treated as 'likely' in the first place. [See story here.] ...

"[C]urrent guidance encourages planners to consider high‑end scenarios such as [the discredited] SSP5‑8.5. ... a scenario that IPCC lead author, and Canterbury University’s Professor Dave Frame, described as one 'no one believes.'

"In Kāpiti, modelling by consultants Jacobs Engineering—using high‑end assumptions based on SSP5‑8.5—identified thousands of homes as being at risk from coastal hazards. But when an independent review was undertaken by coastal scientist Dr Willem de Lange, using scenarios aligned with likely outcomes, the number of at‑risk homes fell to just 44.

"That is not a technical quibble. It is the difference between targeted risk management and large‑scale planning intervention affecting entire communities.

"Across New Zealand, similar approaches are being used by Councils to inform hazard mapping, LIM notations, and development restrictions. Tools like SeaRise continue to present projections derived from scenarios that no longer reflect what is considered plausible.

"Unwinding that system will be difficult.

"But leaving it in place is worse."

~ Sean Rush from his post 'New Zealand is planning for a climate future scientists now reject'

"It's only words..."

"It's only words -- unless they're true."

~ David Mamet, from his play Speed the Plow

Why trust them now?

This National-led coalition came to power promising to slash bureaucrats and savage red tape. Since then, the numbers in the coercive sector have declined only slightly (around 2,000-3,000 trough dwellers), and are still well above 2017/2020 levels. The ACT Party, of whom the leader is now Deputy Prime-Minister, went to the election specifically promising massive regulatory reform, and had that written into their coalition agreement. 

On Wednesday, the ACT Party posted a pictorial illustrating how over-regulated we are.  To which the redoubtable Michael Reddell asked the obvious question: 

How many regulatory bodies have been closed down, or substantially hacked back, in the first 2.5 years of this government?

No answer. So he asked again:

How many of the 267+ regulators had been abolished or substantially hacked back under the current govt, 2.5yrs in?

He's still asking.

So here's a question for you: what value is a government who promises to do this term what they promised to do last term, but didn't.

Would that meet the definition of "trustworthy"?

"Socialism is an alternative to capitalism..."

“A man who chooses between drinking a glass of milk and a glass of a solution of potassium cyanide does not choose between two beverages; he chooses between life and death. A society that chooses between capitalism and socialism does not choose between two social systems; it chooses between social cooperation and the disintegration of society. Socialism is not an alternative to capitalism; it is an alternative to any system under which men can live as human beings. Socialism is an alternative to capitalism as potassium cyanide is an alternative to water.”

~ Ludwig Von Mises from his 1949 book Human Action (ch. 24 sec. 3)

Reducing the coercive sector of the economy

While too many pundits still labour under the misapprehension that the primary job of government is to continue subsidising Wellington's economy with make-work jobs, one insightful twitterer offers several good reasons why reducing the size of the public service is a good idea:

• Reduces complexity 
• Reduces waste 
• Reduces cost 
• Reduces an out-of-control deficit 
• Stops unnecessary government programmes 
• Reduces power and influence of the state 
• Frees up people who work in the coercive sector of the economy to work in the productive sector of the economy

Ideally, it reduces that coercion. As Walter Williams noted: 

Powerful government tends to draw into it people with bloated egos, people who think they know more than everyone else and have little hesitance in coercing their fellow man.

Fewer know-alls given power --> less coercion.

Ideally.

However ... Michael Reddell is exactly right: National's announcement looks more like last-minute electioneering that a genuine plan for improvement.

63657 core public service Full-Time Equivalent employees (FTEs) as at 31/12/25. Of those 24834 are in Corrections, MSD, & Ministry of Children. Seems unlikely there would be material cuts in any of those ... To cut 8000 FTEs off the rest by 2029 would mean a 21% cut.

No doubt it could be done, but over its first 2.5 yrs the govt has done very little to cut public service numbers, so people would reasonably be quite sceptical that the same senior ministers will suddenly sharply change their approach. ...

One might sympathise with the spirit of [Nicola Willis's announcement] (I do) but can't help noticing that there are no specifics (at all) beyond the baseline cuts for 26/27 for some agencies in the Budget. Beyond that is little more than handwaving. 

Talking up 20% real cuts (2+5+5 + 2% pa inflation) means almost nothing at this point (6 months from an election, with her party averaging say 28% or so in recent polls) without specifics. It has the feel of budget-accounting gimmickry: just enough to get Treasury to count the savings in the forward fiscal projections (& thus avoiding any more slippage in the date for getting back to surplus on the measure the govt likes (but Treasury doesn't). 

Had the speech been given in Dec 2023 it would have been one thing, but they've had 2.5 yrs to work out what they want to cut & still the answer seems to be "not much at all, but perhaps this latest rhetoric might get us beyond the election."

As for track record, recall that in the 2025 Budget, core Crown expenses for 25/26 were to be 32.0% of GDP, UP slightly on the 31.8% for the last full year under Lab.

And simply saying "Cut!" without specifying on which portion of the bureaucratic anatomy the knives should be sharpened leaves the Government, as before in this term, hostage to the decisions of the capital's Sir Humphreys.

[So] simply telling us that you'll cut some spending quite a lot in future (really I will...) brings to mind both the old economist's joke (let's assume a can opener) and St Augustine on continence and chastity ...  but not yet.

What's in a name? Are we really a "capitalist command economy"?

WHAT'S IN A NAME?

What do you call an economic system that's neither a free-market economy with a small state and light-handed regulation, nor a state-owned economy run by bureaucratic, politically-driven trading departments -- it's neither, sometimes both, but mostly a mongrel grab-bag of bits from small govt and large. They're wrestling with that question in the UK at the minute -- and we could just as easily ask the same question here:

The left call it neoliberal but neoliberals have had no meaningful influence on British governments for thirty years. The right call it socialist but neither the Tories nor Labour have shown much [recent] interest in seizing the means of production. 

Liberty Scott puts the question:

Of course the Greens, TPM and parts of Labour will say t[that New Zealand] is under the oppressive yoke of neo-liberalism, and their latest scapegoat "billionaires" and "foreign capital"; and, of course, people like me will rail against the "commie kids" on the left in Parliament and in local government, but [in truth] there's little real evidence of NZ embarking on [either] Douglas/Richardson Mk. 2 or becoming the DDR ....

It's not to say the Douglas/Richardson ... reforms have been unwound. New Zealand isn't returning to rampant protectionism, nor has Labour embarked on vast re-nationalisation ... ["but hold my beer!" says Winston], but what has happened is an accretion of central command and control.

This is one reason some pundits are beginning to realise that, beyond the usual vitriol, there's so little separating the two tired main parties that a Grand Coalition would at least be more honest than continuing their pretence of difference. They've both kept the institutional structure established by Douglas/Richardson, while quietly growing an activist state to increasingly dictate how (and by whom) it will be run -- "regulatory control of the private sector remain[ing] at the heart of what the Wellington bureaucracy advances to meet [their] social goals."

Some might call this Fascism, i.e., the pretence of private property with an activist state dictating terms. But we're not there yet.

Ludwig Von Mises, who'd seen and escaped from the Nazi's fascism, would probably have simply called it a Hampered Market:

The system of interventionism or of the hampered market economy differs from the German [i.e., the Nazi] pattern of socialism by the very fact that it is still a market economy. The authority interferes with the operation of the market economy, but does not want to eliminate the market altogether. It wants production and consumption to develop along lines different from those prescribed by an unhampered market, and it wants to achieve its aim by injecting into the working of the market orders, commands, and prohibitions.

BOTH MISES AND HIS student Ayn Rand were quick to point out that the Hampered Market, or what Rand was happy to dub the Mixed Economy, was of course a mongrel mixture on the way to something else -- that no matter how tired the state's representative might seem, it is still their coercion that is pulling the strings. Any analyis of the Mixed Economy must logically, she said, begin by identifying the two elements that are being mixed: A mixed economy, she identified "is an explosive, untenable mixture of two opposite elements,” freedom and statism, “which cannot remain stable, but must ultimately go one way or the other.”

A mixed economy is a mixture of freedom and controls—with no principles, rules, or theories to define either. Since the introduction of controls necessitates and leads to further controls, it is an unstable, explosive mixture which, ultimately, has to repeal the controls or collapse into dictatorship. A mixed economy has no principles to define its policies, its goals, its laws—no principles to limit the power of its government. The only principle of a mixed economy—which, necessarily, has to remain unnamed and unacknowledged—is that no one's interests are safe, everyone's interests are on a public auction block, and anything goes for anyone who can get away with it. ...

A mixed economy is rule by pressure groups. It is an amoral, institutionalised civil war of special interests and lobbies, all fighting to seize a momentary control of the legislative machinery, to extort some special privilege at one another's expense by an act of government—i.e., by force. In the absence of individual rights, in the absence of any moral or legal principles, a mixed economy's only hope to preserve its precarious semblance of order, to restrain the savage, desperately rapacious groups it itself has created, and to prevent the legalised plunder from running over into plain, unlegalised looting of all by all—is compromise; compromise on everything and in every realm—material, spiritual, intellectual—so that no group would step over the line by demanding too much and topple the whole rotted structure. ...

The only danger, to a mixed economy, is any not-to-be-compromised value, virtue, or idea. The only threat is any uncompromising person, group, or movement. The only enemy is integrity.

If there's one thing New Zealand's so-called opposing parties do agree on, beyond their love for the activist state, it's their hatred of the groups their erstwhile opponents appear to favour., their cronies or voting fodder But as Rand points out, 

If parasitism, favouritism, corruption, and greed for the unearned did not exist, a mixed economy would bring them into existence.

ECONOMICALLY, WE LIVE IN a Hampered Market. Politically, we live in a Mixed Economy. Realistically, we should be aware that neither can exist indefinitely. Things "must ultimately go one way or the other."

"Expensive karaoke"

"I am not here to prosecute Michael Jackson or Michael the film (I won’t be seeing it), but it has driven me to once again say: we need a moratorium on musical biopics. ...

"In recent years we’ve seen biopics about Bob Dylan, Elton John, (two about) Elvis, Robbie Williams, Bruce Springsteen and Amy Winehouse. In production currently are FOUR Beatles biopics, with a separate feature film planned for each member. As with a lot of these movies, the conversation tends to revolve around who is playing the character, how much they look like them or not, how much they sound like them or not (anyone remember months of conversation about Austin Butler’s Elvis voice?), whether the movie is true to life, and so on.

"The main characters of biopics are so familiar to us that the discussion and viewing experience often centres on comparison over content. These are people we are already familiar with, stories we already know, performances we’ve already seen the real versions of. The worst result is essentially expensive karaoke.

"Aren’t we tired? Wouldn’t it be a good time after four individual Beatles movies to have a break from this genre? ... At least Robbie Williams tried something new by making himself into a monkey. ..."

~ Rebecca Shaw from her column 'Please stop making music biopics. We need a break from this tired genre that is essentially expensive karaoke'

"All this might not be so bad if musician biopics weren’t so fake. The whitewashing of Michael Jackson is just another example of the phoniness. I’m now old enough to watch films of this sort where I knew personally some of the people portrayed onscreen, and the gap between the film and reality is wider than Snake River Canyon—and way too wide to jump if you care at all about the real artists and real history behind these films."

~ Ted Gioia from his post 'The Hottest Musician in 2026 Is 'Problematic' Michael Jackson'

UN's IPCC withdraws alarmist scenario, local media continues alarmist news

Take a quick look at the most consequential graph of the last two decades, below.

But first, the news: the UN's Intergovernmental Panel on Climate Change Change (i.e., the IPCC, the organisation promoting the Climate Scare) has officially withdrawn the warmist scenario known as RCP8.5.

This (below) is roughly what the IPCC's RCP8.5 predicts:

For context (and contrast(, here's the actual satellite record of temperatures for the last few decades:

So what's this RCP8.5 then? The simple answer is that it's the scaremongering scenario sold to "policymakers" as their "business-as-usual" scenario. Here in New Zealand it's become "their main planning scenario with authorities planning for 'managed retreat,' forced abandonment of settlements, and insurance companies refusing to insure."

As Quico Toro explains, if the RCP8.5 scenario were comparable with models used to design bridges, it would result in bridges designed to take around 250 M1 Abrams tanks all at once. Not just unrealistic, but illusionary. 

The “8.5” in RCP8.5 refers to the amount of added solar energy the atmosphere will trap by 2100—specifically, 8.5 watts per square meter. That’s very high—likely to bring about a shocking 5 degrees of global warming above pre-industrial levels.

RCP8.5 was the kind of climate scenario lurking behind Greta Thunberg’s accusation, in her September 2019 speech at the UN Climate Action Summit, that “we are in the beginning of a mass extinction.” It’s the kind of pathway young people in England were thinking about when they decided they needed to launch “Extinction Rebellion.” It’s been a fundraising bonanza for climate activist groups from Adelaide to Zurich, the main player in every single alarmist climate critique you’ve read in the last 15 years.

And it’s been the default setting for literally thousands of climate science papers—Google Scholar lists more than 30,000 published since 2018 alone. It was from this kind of research that we got lurid papers like “Future of the human climate niche,” where respectable Dutch climate scientists claimed that one in three human beings live in regions that will become unlivable in the next 50 years. It was this kind of research that gave rise to countless breathless headlines about how outdoor labor was about to become impossible across much of the tropical world, and alarmist documentaries claiming the ocean was about to end up without any fish. It was RCP8.5 that turned David Wallace-Wells’s “The Uninhabitable Earth” into the most read story in the history of New York Magazine, and later propelled the book version to the top of the New York Times best-seller list.

The story of RCP8.5 is ultimately the story of what goes wrong when people convinced they are defending “The Science” catastrophically misunderstand how science works, and when politicized activists glom onto legitimate scientific tools and insist on ramming the round peg of probabilistic forecasting into the square hole of fundraising emails.

As we say above, here in New Zealand millions of words have been written based on the RCP8.5 scenario leading to authorities planning for 'managed retreat,' for forced abandonment of settlements, for insurance companies refusing to insure, for governments slowly but surely strangling our production of energy.

In the month since this became news however, there has been precisely ONE mention of RCP8.5's withdrawal in the local media. One.

What does that tell you?

Choosing careers in an AI world

The daughter of a Microsoft AI tech bloke was choosing careers, so he ranked them. 

First problem: how would she even get started?

The most important thing to understand [he discovered] is also the most counterintuitive. AI is not demolishing careers from the top. It is removing the bottom rungs of the ladder first.
    Think about how almost every professional career develops. A “Big Four” trainee at the accountancy firms Deloitte, KPMG, EY or PwC reconciles spreadsheets and drafts standard documents. A junior solicitor reviews contracts. A graduate analyst builds financial models. These are the apprenticeship stages. They are how young professionals develop the judgment that eventually makes them irreplaceable.
    AI performs many of those tasks faster and more cheaply.

So that's a potential problem for the first in modern history: a whole generation graduating without a clear way to become experienced. An apprenticeship without the material on which to learn.

So is it time to give up?

Robots are going to take your job? No doubt. 

What if robots take all the jobs?  Hint: They can't.

Comparative advantage tells us that "new kinds of jobs will appear, as they always have when technology advances."

Ironically, most of the jobs people are afraid of losing -- such as programming jobs or truck-driving jobs -- were themselves created by technological advances....
    What new types of job will be created? I can no more project that than a man in 1956 could have projected that today there would be jobs in something called “social media”; or that money can be made by driving for Uber and by renting out living space through AirBnB.

One estimate is that alongside all the jobs displaced, around 170 million will be created. "The net picture is not collapse. It is transformation. And transformations reward the families who understand them early."

What's to understand, says the tech bloke, is the four things in which human beings do have a comparative advantage over any machine: Emotional intelligence. Creative vision. Physical dexterity. Ethical judgment. Based on that insight, the tech bloke ranked careers 

across nine categories including emotional intelligence, creative thinking and vulnerability to AI tools. A score closer to 100 per cent means the role depends heavily on things AI cannot replicate. A score closer to 35 per cent means much of the work is already within reach of automation.

Biggest winners: 

• healthcare 
• education
• skilled trades
• creative industries (for genuine creatives)
• tech, finance and law (for those at the level required to exercise judgement)
• diplomacy

Biggest losers are box-ticking jobs, "where tasks are most predictable and repeatable" -- oddly those where intelligence is least demanded:

• paralegal
• accountant
• data entry
• admin

And in this age of transformation, the biggest new career paths might just be something sitting "in the intersections between disciplines" -- something requiring "deep knowledge in a substantive field combined with genuine AI fluency."  A good metaphor for what that looks like, suggests author Derek Thompson, is how Alexander Dumas used to write his fiction, with a zillion research assistants and a writing programme looking like a small factory, "industrialising what he saw as the boring parts of his creativity—research structure, workflow—freeing his brain to do the thermonuclear storytelling." In other words, putting the "AI‑accelerated firehose of information" in the service of creativity, without losing that spark along the way.

And after all that, what did our AI-engineer's daughter decide to do in the end? "After many dinner table conversations, Thea said something that stopped me cold: 'Diplomacy cannot be outsourced to robots, Dad.' Instead of finance she chose to do international relations: learning how humans negotiate, build trust and resolve conflict. Every one of those skills is in the 90th percentile for AI resistance."

His final words of advice:

We are facing a particular moment in history. It is not one that will announce itself. There is no letter from school, no official notification that the world your child is preparing for has quietly become a different one.
    The families who will look back on this decade without regret are the ones who had the conversation early and trusted that a child who understands the world they are entering is far better equipped than one protected from it. Here are some first steps:
    If your child is 10 to 12, build the foundations: teach them to be curious by reading carefully and arguing a point. Curiosity is the hardest quality to automate.
    If your child is 13 to 15, have one conversation this week. Not a lecture. Ask what they think AI is doing to the world. Help them begin using AI tools, not to do homework for them, but to understand what these systems cannot do. That understanding is the first superpower.
    If your child is 16 to 18 and making real choices, look hard at where the four human superpowers appear in the careers they are considering. AI fluency is not optional any more. The wage premium for those who have it is visible and growing fast. “Wait and see” is not a neutral position. It is a decision. The data says it is the wrong one.

NB: The Economist magazine's analysis suggests AI may already be harming some graduates’ job prospects

We found that graduates in fields more exposed to AI have suffered markedly worse outcomes. Between 2022 and 2024 graduates in the least-exposed quintile—studying subjects such as education, philosophy and civil engineering—saw their average full-time employment rate fall by just 1.5 percentage points. Those in the most exposed quintile—including computer science, computer engineering and information science—suffered a 6.6 percentage-point drop (see chart 1 above). ... the trend continued for the class of 2025 (see chart 2 below).

RELATED:

"Which jobs can AI learn to do? We examine this for every occupation in the US economy."

What Jobs Can AI Learn? Measuring Exposure by Reinforcement Learning - CORNELL UNIVERSITY RESEARCH PAPER, 4 May 2026 

"We investigate the potential implications of large language models (LLMs) on the U.S. labour market."

An Early Look at the Labor Market Impact Potential of Large LanguageModels - UNI OF PENNSYLVANIA, Aug 2023