The writing was on the wall for the Sixth Labour Government when Prime Minister Jacinda Ardern stepped down in late January 2023.
It's probably not why she resigned, but the political pendulum was already set to swing back and bowl over big chunks of progressive policy in the process.
Chris Hipkins, one of the few people forewarned of Ardern’s resignation, recently said he felt a “strange sense of foreboding” when he became Prime Minister a few days later.
Labour lost this year’s election back in 2021, when Aucklanders lost patience with long lockdowns and inflation left its target band to seek a life among the stars.
Any Government that presides over a 20% increase in living costs during a single term will not be reelected; regardless of whether it was their fault or not.
But, Hipkins did breathe a bit of life into Labour’s chances. The left leaning bloc was leading the polls for the early part of the year and it looked like a third term could be possible.
Voters wanted a change in Government but seemed unconvinced by the alternative.
Christopher Luxon, the first-term MP and leader of the opposition, was struggling under the pressure as some began to blame him for the National Party’s poor performance.
Hipkins sensed an opportunity, ordered the party to focus on ‘bread and butter issues’ and struck a match for his policy bonfire. He had just nine months to get ready for Election Day.
It was about this time that I joined Interest.co.nz and had the opportunity to meet the Prime Minister. In a short chat, Hipkins commented on some of the difficulties of his new job.
“Oh well,” I said mindlessly, “you’ll only have to do it for nine…”
I paused just long enough to watch his eyes narrow slightly.
“...years,” I finished quickly. Graciously, he laughed.
New Zealand gets poorer
While Hipkins was working to save his party, New Zealanders were getting to grips with reality: the pandemic had made them poorer. Or at least, not much richer.
This was a nasty shock for those who thought their bank balances and asset prices were climbing because of an increase in intrinsic value, not fiscal and monetary policy.
Paul Conway, the chief economist at the Reserve Bank of New Zealand, gave a speech in which he accepted the central bank and government had some culpability for inflation.
Prices were rising because fiscal and monetary responses to the pandemic supported demand while health measures reduced the supply of labour and products, he said.
“While lockdowns were tough going … economic life for many New Zealanders was surprisingly ‘normal’ for many months during the global pandemic”.
Despite ‘normal life’, the Government was spending big to support the economy and the RBNZ had dropped the official cash rate to its “‘effective lower bound”.
Supply shock + stimulus = inflation. Policy pushed the economic pendulum too high and it has begun to swing back with a vengeance.
“We are worse off because of the pandemic, the war and floods. Monetary policy cannot do anything about the loss of real income stemming from these events,” Conway said.
Average gross domestic product growth in New Zealand over the past decade has been about 2.8%. We can think of that as being roughly the country’s potential growth rate.
However, real GDP increased a whopping 6% in 2021 and 3.2% in 2023. NZ now has to pay that surplus growth back with lower rates in 2024 and 2025.
Treasury forecasts growth to resume as normal—2.9% average between 2026 and 2028—once inflation and interest rates normalise. We have to let the pendulum swing back.
Labour falls apart
It was still March when Labour MP Stuart Nash was fired for leaking confidential Cabinet information to donors. It would turn out to be only the first of four ministerial scandals.
Just two months later, Meka Whaitiri defected to join Te Pāti Māori. The party went on to win a clean sweep of all seven Māori electorates bar one, Whaitiri’s Ikaroa-Rāwhiti seat.
On election night, a National Party supporter was overheard saying: “Māori were so fed up with Labour that they wouldn't even vote for a former party member”.
That wasn’t quite correct. Voters in Māori electorates were strategically splitting their votes to get more Māori members into Parliament — and it worked.
Michael Wood was the next to go, brought down by a handful of shares he bought as a teenager and failed to sell as a minister despite 16 reminders from the Cabinet Office.
“Political scandals often start as comedies before morphing into tragedies,” I wrote at the time. Wood lost Mount Roskill and didn’t make it back into Parliament.
If he’d sold the shares in a timely fashion, he may have been in a position to become the leader of the Labour Party and run for Prime Minister in the 2026 or 2029 election.
One final tragedy: Justice Minister Kiri Allan’s mental health crisis, car crash, and arrest. That’s four ministers in six months.
Hipkins later commented that this “succession of ministerial scandals” helped to harden the public mood against the Labour government.
“By the time we launched our campaign slogan ‘in it for you’, which was decided some time earlier, many in the public were already feeling that they were anything but our priority,” he said.
National’s turnaround
Here’s where Luxon deserves credit. The National Party was in bad shape when he became leader. It had suffered from its own run of scandals and was decimated in the 2020 election.
Hamish Walker, Michael Woodhouse, Michelle Boag, Andrew Falloon, and Jake Bezzant all had scandals, and the party churned through leaders like it was a butter factory.
Sometimes Luxon gets criticised for being too corporate or managerial, but the party was in dire need of a good manager and there he was.
“That’s it, that’s why I came, that’s why I love doing turnaround jobs, because that’s the challenge,” he told Newsroom in 2022.
His first job was turning the MPs who survived the 2020 election into a functional team that could win the next election and actually govern afterwards.
This seems to have been a success. There have been few scandals or visible infighting since and (spoiler alert) they did win the election.
While Luxon’s managerial skills helped to sort out the party, his political inexperience and corporate communication style did hampered its progress in opinion polls at first.
He was personally socially conservative, politically pretty liberal, and happy to go into coalition with libertarians and nationalists alike. A hard message to sell.
The public didn’t really trust or understand him. He’s socially conservative personally, but liberal politically. He doesn’t want to be in coalition with NZ First but is happy to do so.
What does he stand for? Getting things done. Which things? That has been announced yet.
Behind the scenes Luxon is energetic, warm, and obsessed with people. Literally all people.
It’s not uncommon to find him deep in conversation with the (nominally) least important person in the room, or someone who disagrees with him deeply. He loves it.
But that doesn’t come across much on TV and it isn’t particularly apparent in his policies, which could be fairly characterised as a heavy dose of ‘tough love’.
He has also been landed with the unenviable job of defending unpopular policies put forward by coalition partners to please their minority voter base.
The two most obvious examples are Treaty of Waitangi reform and the rollback of the upgraded SmokeFree laws. National wouldn’t have done either of these things itself.
Tail wagging the dog
The Act Party fell short of expectations in the election but it has been incredibly successful as a political movement and has supercharged reform on the right.
National made several policy decisions during the campaign that were designed to stem the flow of voters shifting over to the Act Party.
These policy changes included housing reform, agriculture emissions, and performatively ruling out a coalition with Te Pāti Māori.
Meanwhile, Winston Peters was working town halls around the country winning support for a revival of New Zealand First. It looked like a longshot at first but that quickly changed.
The party first polled above 5% in August and a month later Interest.co.nz predicted National would need its support to form a Government.
Now, Peters is Deputy Prime Minister — the pendulum has swung in his favour once again.
This was a year of correction, both for an overheated economy and a political party that left too much of the public behind. It remains to be seen how far we’ll swing in the other direction.
121 Comments
The column makes no mention of the Greens and for good reason. For they still sideline themselves in the left field of socialist and racial extremes. Near to thirty years actually in parliament but never in a formal coalition, the coveted cabinet seats. Yet NZ needs, and should be getting, a persuasive voice on environmental concerns and directions. Can only imagine how disappointed Jeanette Fitzsimons and Rod Donald would be. In fact in a sardonic sense the retort in parliament by Winston Peters, just a bunch of losers, was neither impolite nor inaccurate.
I'm uncomfortable about what is coming. The left (to put a generalist term on all of the previous government) pulled the pendulum a long way over, without selling it to the people as they did so. They were very arrogant to forget that you need to reset the center of the pendulum if you don't want to see it swing back the other way.
One example. The historical tribal interests having a say in our water usage makes sense in a way, and it could have been handled as such that it would have been politically problematic to unwind. Instead we got complete co-governance, conflicts of interest, and, at least for the part I paid attention to before ignoring the whole mess, any opposition to the same meant I still harbored colonial attitudes towards race and was a Bad Person.
It's not going to swing back far the other way. The left has pretty much taken over the education sector, the media as well as the government departments, even the judiciary/judges. The problem with the right is they don't understand the saying give an inch, they'll take a mile... and most people are generally uneducated/only able to see what's directly in front of them, and act on emotions rather than thinking critically... the recent election results are just a hiccup/slow-down for the left... you ain't seen nothing yet, there is no swinging back the other way, the country will keep going left
Yes, education tends to make people more left leaning. The more you learn, the more you understand. Apart from economics degrees of course.
Don't confuse education with understanding Jfoe. The two are not necessarily symbiotic. The lyrics of Jello Biafra referred to this in the ignorance of the student lefties in support of revolutionary actions in faraway lands in which they had little understanding or skin in the game. It can be easy to a latte socialist when you lead a relatively comfortable existence under the wing of the Great Satan (U.S.).
An election year of a bit of a battle of the negatives wasn’t it. Problem for Labour was their plight was on record, starkly so, and while there were, and still are, doubts about National & Co, they were in comparison on a relatively clean new page. So as in 2017 the electorate introduced a rider in the form of WP/NZF. This is consequently the first time NZ has arrived at a coalition government in a true form of MMP, two junior partners of sizeable representation. Right now NZ needs a period of constructive government stability. Here’s hoping.
- it's not just men who're angry, see Roy Morgan poll link below "support among women is more evenly split with a bare majority of 50.5% supporting National/ ACT/ NZ First compared to 44.5% supporting Labour/ Greens/ Maori Party."
- https://www.kiwiblog.co.nz/2023/12/should_the_covid_royal_commission_be…
- She left when the people saw the empress had no clothes on & had abrogated her democratic responsibilities with gross deceit & hubris. There are many countries where resignation would be considered the soft option.
Noting also that I voted for her - twice. Its nothing personal.
The demographic analysis in the Roy Morgan poll link below suggests that National/ACT/NZF support increases with age while Labours declines.
"A young wo/man who isn’t a socialist hasn’t got a heart; an old wo/man who is a socialist hasn’t got a head." Various sources
I worked on the first year of the COVID response - so perhaps I am biased. But, 2020 and early 2021 were handled very well here. The response saved tens of thousands of lives. My old contractor mates worked on the response in other countries and I can assure you that their politicians had a nightmare. I have little time for the response after 2022 etc, nor the catastrophic RBNZ response throughout 2020 and 2021 (when Adrian et al should have just stayed at home smoking cigars and drinking brandy).
Her biggest mistake, the one which cost them another term, was not to pivot when Omnicron blew the doors off the walls, but thankfully wasn't nearly as deadly. The mandates, which came into effect after COVID had mutated into something far weaker than initially, and a lot more contagious, will forever make her legacy a complicated one.
I was happily in the vaccinated camp for what it's worth, but I watched many who weren't struggle greatly financially, and the mental health scars are still very raw.
It was all signed sealed and delivered until Scott Morrison put our PM Ardern on the mat and suddenly, prematurely NZ opened up its border to Australia. At that point NZ’s controls became only as good as Australia’s and Delta was on the way, and very soon in Auckland. That then generated the Auckland lockdown(s) and isolation and that wasn’t good for anyone and in particular PM Ardern who forced on a very rare visit to her electorate and surrounds, wrapped in plastic as if the invisible man, looked not only plain scared but completely out of touch with “her people.” That dire and protracted Auckland predicament I suggest was the beginning of the end for her and Labour.
Jfoe - I have to call you out for this gem of absolute dogma:
"saved tens of thousands of lives"
Total deaths in BC Canada (using them as the example as they have the same amount of ICU beds per capita, the same population as NZ and also the same DR and Nurse shortages) to date are 5,400. March 2020 -April 2023. They used similar recording methods as NZ (if you die from anything within a month of testing positive, or are found to be positive after death, it was added to the "covid19 mortality rate". Median age of deaths from Covid19 is 85 years old.
BC, Canada had Covid right from the beginning. BC used social distancing, mask wearing and then vaccines to control the spread. But BC never completely shutdown like the last AKL lockdown or earlier NZ lockdowns.
So - based on your "saved tens of thousands of lives" pure unadulterated lie, BC should have had 20k people die by now.... Didn't happen.
I did analyse the research and I did the maths throughout the first 2.5 years of the pandemic. Most Kiwis did not, the govt did not and it appears that 50% of the electrorate did not, or could not. (or were directed not to think at all, by Jacinda).
This is such a weird hill to defend and the conspiratorial thinking evident in this post is bizarre.
1. In March 2020, the New Zealand modelling predicted 80,000 excess deaths. An excess death is when someone dies who would otherwise be alive, so yes, there are tens of thousands more alive than would otherwise be expected given no public health measures.
So yes, tens of thousands of excess deaths in the absence of public health measures is entirely accurate.
With British Columbia's public health measures, they achieved the highest excess deaths in all of Canada.
2. B.C. did implement lockdowns in 2021.
1. The modelling from March 2020 was based on fantasy/worst case scenario/spanish flu best guesses. By the end of 2020 a lot more was known about the virus and modelling was updated accordingly. In March 2020 people were sanitizing their groceries, as no one yet knew that this was an airborne virus that required an exposure time of over 15 mintues in a confined space to catch it from anyone. This changed when Omicron turned up.
2. BC is a retirement mecca for Canada - it also has a huge amount of elderly undocumented immigrants that are "just visiting". More 80+ year olds = more deaths.
3. Lockdowns in BC - yes, but they did nothing like the NZ lockdowns. All shops were still open and you could go about your life, minus sports events and public gatherings. Hairsalons and massage were the most affected.
4. The fact that you are trying to justify fully debunked, poorly aged, modelling from 2020 when the facts from March 2020 to Dec 2023 show that the modelling was 100% wrong, is a very braindead hill to die on.
5. I have used hard data and facts, you have used outdated modelling from the stone age (when it comes to Covid19 science).
6. You need to stop believing everything you were told from the "Podium of Truth".
****You suggest 80K excess deaths were prevented. Yet BC only had 9,150 excess deaths (including a heatdome that killed between 600 and 1000 people alone). Excess deaths also include all the cancer victims that died due to screening, testing and operations being massively reduced. To try and lump all excess deaths on Covid19 is braindead***
I understand the Covid-19 pandemic has been a fearful and anxiety provoking time for many.
1.
The modelling from March 2020 was based on fantasy/worst case scenario/spanish flu best guesses. By the end of 2020 a lot more was known about the virus and modelling was updated accordingly.
Correct, it was updated. From the Lancet:
For the US estimates, the differences produce a 54–70% overestimation of approximately 1 million deaths. For the UK estimates, the differences produce a 51–68% overestimation of approximately 200 000 deaths.
So if 80,000 was overestimated by 60%, 50,000 people are still alive today who otherwise would have been dead.
2. Auckland has a large population of low socioeconomic people living in high housing density conditions with highly complex healthcare needs. What's your point?
3. So, your earlier comment was false.
4. See above. Refer to earlier comments.
5. Really? From my point of view, you have not done anything of that sort.
6.
You need to stop believing everything you were told from the "Podium of Truth"
I stopped paying attention to that relatively early into the pandemic and got on with living my best life.
Now, while you are correct that an excess death is not necessarily a death due to COVID-19 infection, you do not understand what public health measure an excess death actually is.
Today, in the closing days of 2023, I could be listening to experts the world over; on the other hand, I could be factoring in the reckonings of a conspiracy theorist on the internet. Who do you think should be informing a factual, evidence-based worldview?
There is something really weird about men who remain AAA 'angry about Ardern'. She won. She steered the country through COVID better than basically everywhere on earth. She left when she realised her time was up. Get over it.
Did she? Do you have a benchmark for us 'punching above out weight'? Excess mortality?
Come on JC..from your previous comments here you are strictly in this camp.
My point is that we should only really judge what we can and can prove to be true. We've had it rammed down out throats that we were #1 and our experts claim we saved X amounts of lives because of the govt's actions.
I would much rather they say "we did the best given our resources, capabilities, and understanding at the time."
She steered the country through COVID. Um no, she engineered the greatest political economic and health blunder in the nations history. The largest protest since the 81 springbok tour. Last I checked we’re approaching 8 thousand people dead in a little over two years in terms of excess deaths. The COVID-19 vaccine was a net negative in terms of the nations health. It’s hard to grasp the magnitude of the ongoing health/economic/political disaster.
Dan has had enough information put under his nose, to have produced better copy than this.
And Conway is too reality-ignorant, to be worth quoting.
The problem is with our cultural narrative - it is, and has always been, false. Incorrect. A lie.
The narrative lauds, and assumes (as per Conway above) exponential economic growth forever. The only way that could happen, is if it became 100% virtual. Non-physical. Because the 2nd of Thermodynamics applies; keep on 'producing' (turning high-grade energy into lesser) and the residual low-grade heat would boil the oceans in 400 years. This is the stupidity of economics-only thinking, and the fatal flaw in reporting economics without first having applied a physics lens to it. We have become planet-forcing, and will kill ourselves off if we continue the stupidity. With exponential haste...
We can ascertain that economic activity is based on things physical - or we could all become infinitely rich playing virtual monopoly (as some have, temporarily, but only at the expense of others in a zero-sum game). We wouldn't need to build, service, we could just 'get richer'. Doesn't happen; show me real wealth and I'll show you the resultant resource draw-down. Growth was temporary; in the human scale of things - very temporary.
I can't c&p the graph here, but anyone - including Dan - can google: World3 images. Take a look at the resource-drop, top-left to bottom right. Take a look at the three inflections happening NOW. And stop talking crap about this or that (pandemic) reason for growth slowing. faltering, and inevitably going into reverse.
Some of us wonder if knowledge of this multiple inflection was one of the reasons for global lockdowns - it's certainly the reason for the 'cost of living' increase - which will obviously, therefore, not cease. It's also the reason we are seeing more suspect personalities being elected - Johnson, Trump, Netanyahu, Erdogan, and that applies here too; the three clowns are all - in my opinion - flawed; one (at least) shares a common feature with the likes of Bush Junior - fundamental belief. It is not surprising that a lie - economic growth forever - in it's death-throes puts up the kind of minds which need a creed (predilected to avoid thinking from first principles).
Come on Dan....
Yep - bang on, the maths doesn’t work for never ending growth (aka, increased consumption) on a finite planet. But unfortunately those with any type of alternative view to the growth narrative are usually labelled all sorts of derogatory names from hippies to crackpot etc etc….
I disagree with Dan when he says "..... He (Luxon) has also been landed with the unenviable job of defending unpopular policies ..."
I believe the Treaty of Waitangi reform Dan cites actually are popular policies and the principle reason we have the government we do.
As he moves on this issue PM Luxon will get popular support.
Sadly, Luxon genuinely believes that he needs to reduce public spending and the size of the state to unleash the potential of the private sector and power the economy forward. This belief will crash the economy in 2024 - unless either (a) the new Govt move very quickly to implement private sector financing for new infrastructure, which seems highly unlikely, or (b) RBNZ crash interest rates and kickstart the housing ponzi, which is both unlikely and not guaranteed to work during a recession when unemployment is rising.
I seriously doubt the NACTF will reduce government spending or reduce the departments' headcounts by anything like they have claimed they will. Alas for them - reality is a bitch.
For example, the NACTF kicked the Cook Strait solution into touch. Now what? Oh look - they're bringing in consultants to form a committee to advise how to 'fix' it. (Wait! Hang on? Isn't that the opposite of what they said they'll be doing?) Another example? Surplus in 26/27? Their latest 'budget' suggest not.
The NACTF supporters won't hold them to account. They don't mind being screwed by government when they voted for them. Just so long as their team is in power, that's all they care about - for now.
Nicola Willis was clear on Wednesday that:
- Govt revenue was dropping more sharply than expected as the economy slumps (opening up a hole in the budget)
- National remained committed to implementing most of their daft tax cuts in 2024
- Govt are still aiming to return to a mindbogglingly stupid surplus position by 2026/27
- That all CEs would be getting a savings target to hit for next year's budget
They will *have* to get billions from those savings targets (4 above) to implement their tax cuts promise and be on track to deliver a surplus in 2026/27.
What they don't appreciate yet, because they are being advised by ideologues, is that cutting Govt spending will lead to reduced tax revenues and they will end up a negative, job-destroying doom loop.
Oh, I think they will move quickly to implement private financing. But, I know quite a bit about PPPs and similar deals from working in other countries that tried them (and mostly abandoned them). Private finance deals for infrastructure take a long time to set-up - both sides spend months trying to shift risks onto each other during negotiations. Then there is the planning and delivery of the actual infrastructure. It will be 2025 before we see any resultant stimulus imho.
Financing isn't the count.
Obtaining access to resource-stocks, and energy to process them, is the count.
In that light, the private sector don't 'finance'; they put a foot in the door and expect a 'profit'; a 'return'. We are at the global inflection-point growth-wise, so 'returns' from here on are going to be at the expense of someone/something else (under a total sinking lid).
My guessing is that Capex proposals will find it harder and harder to get backing and approval - and to get insured. That is because insurance is most related to physical/real things (whereas issued debt can peddle other stuff into overshoot - past the point where it can be underwritten). Since 2008, it has taken more than $1 of debt, to 'create'$1 of GDP. How long do you think that system - without which there is no privatisation of the Commons, via no law, no law-makers and no paid enforcements or courts - lasts?
Same comment to you as above; google World3, images. Note the inflections, note what they are, and when.
I generally agree with you pdk. What matters is real resources and, in particular, resources that can be turned into energy. I also agree that insurance and risk assessment on capital investments more generally will be what actually drives changes in policy and practice (politics will fail to move quickly enough).
Jfoe. You seem to advocate the kickstart of the housing Ponzi. Is that so ?
If so, how do you see that Ponzi helps anything at all.
My view on the house price explosion is that it was New Zealand's greatest social disaster with multiple effects for generations, and has led to serious reduction in disposable incomes for most.
Dan actually knows deep in his heart that those policies are popular - and admits it obliquely elsewhere in the article :
"National made several policy decisions during the campaign that were designed to stem the flow of voters shifting over to the Act Party. "
He just cannot reconcile it with his overall attempted spin that Labor have done nothing wrong and their crushing electoral defeat is all down to ( pandemic ) circumstances outside of their control.
re ... "Dan actually knows deep in his heart that those policies are popular ..."
Having popular policies doesn't make them good policies. Think of it this way. Half the population is below average IQ. To be popular, you just need that half and one person more and you've become 'popular'.
When did repeal of Labours unmandated undemocratic racist policies become "unpopular"?
https://www.roymorgan.com/findings/roy-morgan-nz-election-november-2023
https://thefacts.nz/social/social-unity-division-ii/
We've already had 50 years of "Treaty of Waitangi reform" largely by stealth, in many cases by unelected entitled self serving bureaucrats, judicial activists and academics.
Too much of the media has what can only be described as a specious approach to the dismantling of some seriously awful, unjustifiable and deficient legislation enacted by the previous government, by implying that the new government is simply being destructive. Actually what is being taken down was what was destructive in the first place and apart from the strident shrilling from the remnants of the last government’s backing chorus, would wager the great majority of the electorate is both relieved and satisfied, to see what is now underway.
Even though NACT are literally passing 'racist' policies as we speak. (Note I don't think they are racist and neither were Labour's)
Like Get feeling says above NACT supporters will be fine with 'their team' doing the stuff they criticised Labour for. They got suckered into the culture wars narrative and now are affiliated with their 'team' regardless of policy.
New Zealand is on the precipice if descending into the UK/US style politics of us vs them.
https://www.nzherald.co.nz/kahu/government-gives-whanau-ora-50-million-…
but are all new Zealanders treated equally, i hate to say it but they are not and have not been for a long time, should we try to fix it by bringing in race positive policies, ( i don't like that) or should we try to make the government machine and departments colour blind instead ( i favour this approach) but that is a very hard ask as it is ingrained.
NACT are not accepting that is the case and prefer to live in a utopia where everyone in NZ is treated the same, sorry i have seen years of case after case of the colour of your skin meaning different treatment in NZ you only have to look at sentencing to see the difference that makes
New Zealand's racist justice system - Our law is not colour-blind | Stuff.co.nz
Even though NACT are literally passing 'racist' policies as we speak. (Note I don't think they are racist and neither were Labour's)
Like Get feeling says above NACT supporters will be fine with 'their team' doing the stuff they criticised Labour for. They got suckered into the culture wars narrative and now are affiliated with their 'team' regardless of policy.
New Zealand is on the precipice if descending into the UK/US style politics of us vs them.
https://www.nzherald.co.nz/kahu/government-gives-whanau-ora-50-million-…
Average gross domestic product growth in New Zealand over the past decade has been about 2.8%. We can think of that as being roughly the country’s potential growth rate.
This isn't the country's potential growth rate - it is the growth rate in credit. Our economy works very simply: people borrow freshly printed money from banks to buy houses, the person at the end of the house sales chain spends that new money into the economy, consumers and businesses transact, people get paid, etc. This model is sustainable when house prices are going up and productivity increases abroad ensure that goods are imported at ever decreasing real prices.
When people stop borrowing money to buy houses, Govt steps in with deficit spending to keep the economy moving (providing Govt credit to replace bank credit). Businesses also borrow - but mostly to buy property (see above) rather than to invest in productivity.
We think productivity is improving because the nominator is hourly earnings, which go up as the economy expands off the back of increasing credit. It's a mirage. Our economy is a ponzi scheme - designed to convert ever-increasing workers debt into the wealth of rentiers. Sorry, it's bleak.
Suggest Hipkins was shrewd enough to realise that the majority of the electorate was highly suspicious of the wealth tax and having that in their manifesto would contaminate Labour for years to come. That suspicion was justified. Minister Parker at the eleventh hour sneaked through legislation enabling the IRD to obtain full disclosure of the wealth of certain individuals supposedly for statistical purposes only. However in so doing he provided simultaneously the complete mechanism for a wealth tax to be implemented generally. Despite incessantly denying he had a wealth tax in his sights, Minister Parker at the end of his “enquiry” nevertheless left the legislation in place and then threw his toys out the window and jumped after them when PM Hipkins quite rightly and prudently dismissed the policy.
i am glad they got rid of that, a wealth tax is a envy tax and would do so much harm to NZ, a capital gains tax i don't have a problem with as long as they take into account losses as well, it is unfair to only tax a portion of a portfolio that made money and not use the portion that lost money to offset it,
and that will affect everyone that has a kiwisaver account (which already pays FIF tax thanks to MC)
i saw a podcast the other day that BE said it is only a matter of time until we end up with a CG tax as society becomes more uneven and less and less people hold more of the assets of NZ.
it was only 3 elections ago when labour tried it and they lost badly, but within the next 3 elections i think they may get one through as long as it ringfences the family home.
A rather superficial summary at best from someone who I've enjoyed reading since he signed on.
It reads well, but ignores the blatant arrogance of the 6th Labour Govt in their endeavours for co-governance [minority racism] & the centralisation of pretty much everything else.
Most NZers know that people in Wellington know f.... ...l about the real world. They talk a lot & meet a lot, but when it comes down to it they achieve very little. Their value-add is minimal & in many cases negative, as they load us up with ever-more regulations deliberately designed to cost much more than before & slow everything down in the process.
The left has gone too far left in recent times. Not just here, but across the west. It is a disease. The Europeans are slowly waking up to it after almost 50 years of bureaucratic meddling, once again, costing a small fortune. They are sick of it & I can't blame them. The tertiary/media axis is toxic & very destructive. It's destroyed families, warped peoples minds & put parliaments in place of parenting, which, as we all can see, is no way to prosper. Our relationships are dysfunctional, our communications are verbal conflict, & worse, we often love it when others do badly. This is no way to run a successful society. And they know it. I just hope that what has happened this year heads towards a more traditional route, you know, the ones that help create our great societies [western countries] in the first place.
You are clearly angry - but it pays to stand back and take in the bigger picture.
For 200 years, we have levered a one-off energy bonanza, used it to extract and process resources, and developed technology to do so. But that technology is useless without the one-off bonanza, which we're half-way through.
So we can coast over the top, by dropping/delaying physical maintenance, triaging proposals (ferries, for instance - nothing to do with left/right, just a bridge too far) - but growth is not coming back. And somehow, debt will have to be reconciled. As will the too-many-people-ever-less-stuff conundrum.
This is very like you complaining that Steerage have had too much recent access to the Bosun's locker, at the expense of First Class. This being the Titanic, at or about impact-point. It's an irrelevant argument. Ironically, those without the ability to buy a ticket at all, won't drown. Meaning the Third World has less distance to fall, and has more-relevant skills anyway.
Europe is just the upper decks - first to tap into the fossil energy and therefore the ones who overran the rest of the planetary inhabitants (with a few in-house skirmishes as to who would be top dog). Because it (and the US) developed first, it has the most problem with decay; the more balls they need to keep in the air per time. Germany will succumb, is my bet - and a cascade will follow; a rout. The US is heading for a two-state form, if it holds at all (as per penultimate Rome).
Oh - and you need to define 'successful'. If by that, you mean consuming more and more for ever, sorry, that isn't on the table as an option. Successful will be a society which does not draw down natural capital - the physics of that is more important than the social construct.
Have you ever wondered where the 1.9 billion dollars went that was earmarked for mental health by the Labour Government?
It was Jacinda Ardern herself that was behind its reroute into other areas rather than deputy Robertson.
https://www.rnz.co.nz/programmes/in-depth-special-projects/story/201891…
".....Within the $1.1bn that went solely to health, nearly half went towards putting more than a thousand mental health advisers into GP practices and other primary care settings, known as the Access and Choice programme......."
The Access and Choice Programme is brilliant. And spread across places new and needed.
https://www.nzherald.co.nz/nz/mental-health-the-government-pledged-19bn…
"...looking at our mental health system in 2023 it feels like very little progress has been made. A blinkered approach to how to spend the $1.9 billion of our health dollars has stymied any good intentions that were behind the original plan."
Cheer up kiwikids. Access and Choice programme is great. So much so it gets criticised by the stuck in mud traditional services
I don't believe mental health needs more money. But the overpaid cosy existing needs a big kick in the bum to get modern and productive.
Transform yourselves or leave. (I have been polite as I can manage)
Wellbeing is a term that became ubiquitous under the previous government, but it is broad, non-specific and also highly subjective which leads to budget overspends as we have seen, as well as lack of accountability and measurable outcomes. Sadly this is another reflection of the previous governments incompetence in setting goals and targets and achieving them.
Puttong aside that a pandemic is never going to be good for business no matter what, were the lockdowns worth the extra lives they saved do you think?
This government seems to feel the other way about human life, with tax income put above regulating away tobacco. Or as some here like to say, they like the 'freedom' for people become physically and psychologically addicted to a product specifically designed to hook them and often kill them. In fact smoking kills more than all illegal drugs, alcohol, car crashes, HIV and firearms combined. I guess a $20 a week tax cut is pretty good though.
Well, it comes down to the fundamental difference between the left and the right. The left believes it knows better than people do, and it regulates everything to save people from themselves. The right thinks that personal responsibility and freedom matters and lets people make their own choices!
auckland did not vote for labour so they lost their biggest voter base, and it was to do with the covid lockdowns and mandates, that and national ran a very smart negative campaign. they will have to come up with something new for the next election, they won't be able to blame the other side in three years for everything still going wrong. helping push through a lot of ACT policy early that hurts those at the bottom will not be forgotten and may force some of those that didn't vote for the left to change sides again especially if they push us into a deep recission by cutting too much government spending and services to fund tax cuts for a small number of people
Maybe but even so, Labour too has some sorting out to do. To put it simplistically, crudely if you like, policies regardless of how well justified or intended, that are perceived by the majority to install favouritism of the minority, and even more so when founded on racial selectivity, are not an election winner, socially, statistically, commercially - you name it.
That perception was put in place by the right, no doubt through blogs etc. Normal NZers don’t even know about this supposed war that you nutters talk about, and you guys were never voting labour anyway.
They mainly lost due to inflation, some bad performance by a few MPs, a solid performance from Luxon, and the Winston Weirdos.
"Normal NZers don’t even know about this supposed war that you nutters talk about,"
$55M PIJF + $50M Covid "media support" + $???M Govt advertising spend = MSM propaganda
"..and you guys were never voting labour anyway."
In fact I voted Labour since Kirk with only 2 old exceptions, including Jacinda twice. Never again.
I will not quite state "never again"...
that said, I stated rather clearly that as long as Ardern and/or Hipkins were associated with a party, I would not vote for that party or any person associated with that party. One had image over substance, and then went on to create a caste based system in NZ as based on personal health choices. The other is rather capable, at least in a superficial manner. The recent policy bonfire and subsequent lolly scramble kinda showed that principles were not important.
All I know is the symptoms of the prior governments 6 years of separatist agenda and profligate spending is being manifested in so many ways:
my sister in law and her young daughter and cousin went to Bayfair KMart yesterday (I know, why!?)… two large Māori ladies jumped in front of her in the queue… she hollered ‘excuse me’ then it all turned to custard: they called her a white racist bitch etc.. probably voted National…
She ended up having to get mall security as a group of them where waiting outside for her.
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