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The Standard

Spin update

Written By: - Date published: 7:52 am, May 28th, 2012 - 20 comments
Categories: budget2012, economy, john key, national - Tags:

Just as a quick update on my pre-budget Spin v reality about a Government that has the worst growth record of any since before Michael Joseph Savage, and has a 52% increase in unemployment despite more than 1,000 NZers leaving for Australia each week:

  • John Key had promised 4 per cent growth for the year to last quarter – he delivered 1.6% (which is great by his standards).
  • Bill English has been promising 170,000 jobs each budget – and not delivering them.  This time he cut his unfulfilled hopes by 16,000, and probably won’t make that either.
  • John Key told us in the budget that exports were rising – by the end of the week the stats showed they fell almost $800 million (17 per cent) in the last year.
  • John Key promised growth in real wages – this year we find it has been negative the past two years, will peak at just 1.6 per cent in the 2013 March year, and will then decline.

20 comments on “Spin update”

  1. Carol 1

    Gordon Campbell’s article last week on the budget makes some interesting reading, too.

    It begins with some skepticism about English’s spin, and lack of creative solutions, and goes to point out some instances where the budget fails (e.g. on R&D:

    http://gordoncampbell.scoop.co.nz/2012/05/25/gordon-campbell-on-the-budgets-spreadsheet-victories/

    Ever the Cautious Kiwi, he did his best to dress up his allegedly no frills Zero Budget as prudent management in uncertain global times. Except…it’s not really a sensible response. Not when almost every indicator you can mention – unemployment rates, GDP figures, retail spending, the trade deficit, commodity prices, manufacturing output etc etc is in dire trouble and heading south. Compared to the rest of the world, our levels of government debt leave room for creative leadership and productive investment. Yet like Bartleby the Scrivener, English prefers not to.
    […]
    (Public science is being commercialised and put at the service of business, but there was nothing in the Budget to encourage the private sector to cease its freeloading, and pay for its own r &d.)

    Campbell is also pretty damning about the lack of evidence that asset sales will bring about the planned financial/economic returns:

    So, what might be the expected rate of return from those investments, and when might the country begin to receive the returns? Uh oh. There isn’t any such figure, the helpful Treasury boffins at the Budget lock-up told me, or an estimated time frame. It’s just not like that.

    Right. So we are selling down our stakes in high performing state assets in order to spend the money on things for which we can’t estimate a return, at least not in any foreseeable time frame.

  2. the worst growth record of any since before Michael Joseph Savage

    Perhaps it isn’t a coincidence that “before Michael Joseph Savage” we had the Great Depression, and over the last few years we have had the…

    …2007–2012 global financial crisis, also known as the Global Financial Crisis (GFC), is considered by many economists to be the worst financial crisis since the Great Depression of the 1930s.

    http://en.wikipedia.org/wiki/2007%E2%80%932012_global_financial_crisis

    Our economy was headed downhill, encumbered with significant committments, when the Clark government was still in power.

    It’s certainly true that things have been tough under the Key government, but Labour now share their return to surplus goal albeit with a different policy mix.

    • bbfloyd 2.1

      her we go again… little pete just has to leap up and make excuses just in case big pete is singed in the blow by coming from the realisation that this budget is a work of fiction by and large….

      pathetic….. and so transparent as to be pitiable…..

      the only debate that needs to be held is why the government are able to occupy the treasury benches when it is so obvious that they aren’t competent to govern….and what inducements are being offered to get reporters protecting them from the backlash that should be happening…

      wake up and smell the flowers little pete…big pete is irrelevant… he is nothing more than a convenience…. his identifying himself with, and being complicit, with this level of incompetence will ensure a shorter lifespan for his ego driven vehicle….nothing you bray will change that….

      • Pete George 2.1.1

        You seem to forget that Labour was judged more incompetent (relatively) than National. Them’s the flowers of reality.

        We get to have that debate again in two and a half years. In the meantime…

        …and what inducements are being offered to get reporters protecting them from the backlash that should be happening…

        You accused me of making excuses and being pathetic?

        • Dr Terry 2.1.1.1

          OK Pete, maybe I am just ignorant, but please remind me WHO AND ON WHAT BASIS, judged Labour more incompetent?(I suppose you mean the voters – well, the majority of voters are “relatively” stupid!Is it you, perhaps? So just what the hell is “relatively” supposed to signify?

      • sthn.jeff 2.1.2

        While you may consider Dunne to be irrelevant, he was democratically elected by the voters of Ohariu with an increased majority and thereby not irrelevant to the good people of Ohariu, unless of course, you consider their democratic right to vote and elect Dunne as their representative to also be irrelevant

        • Te Reo Putake 2.1.2.1

          The vast majority of Ohariu voters rejected Dunne, Jeff. He is merely the representative of the largest minority of the voters of that electorate. The party vote for United Follicles was only a few hundred strong, which suggests Ohariu voters know all too well that UF itself is completely irrelevent.

          • sthn.jeff 2.1.2.1.1

            What a load of tosh…. he won an election based on the electoral rules gaining from memory 1700ish more votes than nearest opponent. That makes him the elected representative. Based on your reasoning though, Charles Chauvel was rejected by even more voters

            • Te Reo Putake 2.1.2.1.1.1

              Which part of the factual statement I made do you consider to be tosh, Jeff? As you note, Chauvel was ‘rejected’ by an even larger number, but if we had a ‘top two’ run off system in electorate seats, Chauvel would be the MP, assuming the Green vote went his way.
               
              The point I was making is that Dunne may be the MP, and fairly elected under the FPP system we use in electorates, but he does not represent the majority of the voters in Ohariu. I think you are going to struggle to argue against that rather banal fact, given that it applies in just about every other electorate as well.

              • sthn.jeff

                Big assumption that Chauvel would have won assuming Green votes went to him in a two way run off. You have conveniently neglected the 6500 odd votes Shanks got. All totally immaterial. Dunne won the seat under the electoral system we have and is thereby the democratically elected representative for Ohariu. That is how democracy actually works!

                • Te Reo Putake

                  Yep, you’re probably right about Shank’s votes. I’d forgot that she even ran, but then it wasn’t like she tried too hard to win it!
                   
                  I just looked up the result and it is weird in a lot of ways. Dunne got 14000 votes, UF only 672! Shanks only got 7000 votes, but National got 49% of all the party votes cast, which suggests that it’s really a blue ribbon Tory seat in disguise.

                  • sthn.jeff

                    I think the one thing it actually shows above all else is that National and a number of other Voters were prepared to do anything (ie voting for Peter Dunne) in preference to having Charlie Chauvel be their elected representative.

                    • Te Reo Putake

                      Glad you recognise that voting for Peter Dunne is an unpalatable experience!

                    • sthn.jeff

                      Lol… it was far far far more palatable than voting for Charlie Shovel!

    • Ben Clark 2.2

      Yes, and Savage initiated policies to pull us out of that recession, after the previous government by National’s precursors had had the wrong policy settings and kept us stuck in it.

      It looks like it will be up to Labour again to have “a different policy mix” and make the changes to get us out of this slump too.

      If you change nothing, nothing changes – we need some different fiscal settings to help our exchange rate, and a capital gains tax to push investment towards the productive sector instead of housing bubbles. Austerity & asset sales don’t work – they’re projected to worsen our external deficit at an alarming rate.

      Our main 2 trading partners – China & Australia – didn’t enter recession at all, continuing with strong growth. So blaming macroeconomic factors is somewhat weak. 1000 people each week are leaving because of New Zealand’s problems, not Greece’s.

      And “Labour now share their return to surplus goal” – after 9 years of surplus in 9 years of government, leaving no net government debt, I don’t think the right have the mortgage on “surplus”. In fact as they rack up over $70 billion of debt in under 6 years, National really just have the mortgage…

      • Draco T Bastard 2.2.1

        If you change nothing, nothing changes – we need some different fiscal settings to help our exchange rate, and a capital gains tax to push investment towards the productive sector instead of housing bubbles.

        You suggest that something needs to change and then tell not to change.

    • Georgecom 2.3

      Pete, it is true that we had the Global financial collapse, that our economy did contract before National took office and that the Labour Govt has charted a path to surplus. Thats all true.

      The point however is that time and again English, Key and his government have failed to make good on their promises. It is never their fault however, something else is blamed.

      They were elected in 2008 and 2011. They are the government. They write the budget and deliver the forecasts. They just can’t get them right.

  3. Rob 3

    Absolutly no understanding or comprehension of any macro economic factors at all. 

    Your solution, just blunder on in and throw money around and congratulate your self for it.

    • McFlock 3.1

      Um… no.

      ps: are you saying that National actually achieved the goals outlined above? Or that they failed to achieve those goals? Or simply that they never really set those goals in the first place?

    • mike e 3.2

      seems like Nationals policy Rob just spend money where the votes are and forget about research and development income disparity borrow and hope Nationals policy.

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