Bridges thinks the solution to Covid 19 is tax cuts

Written By: - Date published: 8:14 am, March 5th, 2020 - 64 comments
Categories: making shit up, national, same old national, Simon Bridges, spin, tax, uncategorized, you couldn't make this shit up - Tags:

Simon Bridges gave another car crash of an interview on Radio New Zealand yesterday morning.

He chose to attack the country’s response on Covid 19.  There is an unwritten rule that you do not get all political in times of a crisis because the country needs leadership, not petty squabbling.  Because often the country is relying on professional advice which should normally be respected.

Siouxsie Wiles at the Spinoff expressed the rule well:

I do understand that you lead the Opposition. I get that it’s your job to hold the government to account, and that this is an election year. Of course you and your caucus are keen to score points against the government wherever you can. But the reality is, you don’t actually have to oppose everything it does. Sometimes, such as in the case of a public health emergency, it might be worth putting the kneejerk response on hold.

I was really disappointed to hear you get stuck into the official response to the coronavirus outbreak and the testing regime in comments relying on anecdotal feedback.

And when I heard your colleague David Bennett, MP for Hamilton East, telling the listeners of Hamilton’s local radio station FreeFM that the government had “dropped the ball, big-time and put New Zealanders’ safety at risk”, and that people “should be out there panic-buying”, well, then I started to see red.

I can’t quite believe I need to tell you this, but during a serious outbreak of a new infectious disease, the last thing we need is for our elected representatives to be undermining the important messages coming from the government, scientists, and public health officials.

What was the nature of Bridges’ criticism?  He wants everyone to be screened, even if they don’t meet the criteria for screening set by the professionals.  This is against medical advice given to the Government and also ignores the fact that we will run out of testing kits if we do so.

And he has a solution to the crisis and it is … drum roll … tax cuts!

The country is facing the possibility of a trade downturn.  What better way to deal with the situation by weakening the ability of the country to respond by increasing deficits and depriving it of options.

Corin Dann was having nothing of this nonsense.  There was this fascinating exchange after Bridges criticised the state of the country’s economy and proposes a tax cut.

Dann:  Most economists would argue we have a fiscal war chest, we have $12 billion worth of surplusses forecast, we have got debt at below 20% of GDP, unemployment at 4%, even if you’re right it is going to be a marginal difference isn’t it?

Bridges:  It depends on what you do.  But if you look at the economy last year the latest Reserve Bank [growth] projection at 1.6%, in the last five years of the Key Government we grew it at 3.5% …

Dann:  But even if you are right Mr Bridges it does not change the fact that the fundamentals, the amount of debt, the ability of the New Zealand economy to absorb this hit is still there one way or the other.

Bridges:  This all speaks to the inheritance that the Government got but the point of that growth is that in terms of small businesses, in terms of households and their rental costs and so on they do not have the protection, the buffer.  Now the issue …

Dann:  Why don’t they have the buffer?  They do, the Government has the surpluses, it has the low debt to spend?

Bridges:  Really?  No I am talking about the impact in the sector that low growth in the economic situation for those small businesses and for the households …

Dann:  Just a second Mr Bridges how will it help the Crayfish industry if the economy had been growing at half a percent more, they’ve lost their market. 

Bridges:  Well fundamentally families would have more money in their pockets.  I mean they would have more ability going into this to do something.  But the other side of it is if the Government can’t see it or doesn’t acknowledge where we are and they say “Look everything is ok you know 1.6% whatever GDP per capita lowest it has been for a very long time it doesn’t matter” that to me suggests they will not be able to solve this and get to the remedy.  So lets get to the remedy.  It seems to me when I have listened to Grant Robertson being interviewed by you, there’s a lot of nice talk, he’s read the treasury breach ah brief but he doesn’t have any sense of a comprehensive overall.

Bridges then talked enthusiastically about a tax cut for middle income earners. But when asked about an increase in benefits he said “if people make their case”.  He said that benefit increases were not proposed.

Get that?  With blind faith Bridges thinks that a tax cut will steer the country through the crisis.  But when asked about a benefit increase he says the case would have to be proven.

How crazy is that?  If a business is struggling it will be making little or no profit, ergo will pay little or no tax.  A tax cut will do diddly squat to help it.  But a highly profitable business will have its owners high fiving each other and planning overseas holidays and buying imported goods, behaviour which will have little beneficial effect of the local economy.

But give a beneficiary extra money and they will spend it locally.  A bit more food, a trip out for the kids.  Things with local beneficial effect.

Simon your prejudices are showing.

The Government’s thinking is typically more nuanced.  From Jane Patterson at Radio New Zealand:

Finance Minister Grant Robertson said ministers were working through on a “sector by sector, region by region” basis.

“This is affecting businesses very, very differently”, he said.

“We’ve obviously got export-focused businesses where we’ve seen some immediate impacts… we’re working that through, we’ve got people on the ground.”

He has left open the option of tax cuts or direct cash payments to people to stimulate the economy; Robertson seemed to favour the latter as it would be a one-off measure.

Part of the work being done now was to gauge what level of spending may be necessary, he said.

“I think it’s really important we do do this in a measured way, we’ve got to make sure that anything we do actually gets to the people who need it, that it actually solves the problem that we’ve got and is sustainable.”

At the moment the economy was “continuing to tick over”, Robertson said, although “clearly there are significant problems for particular industries and particular regions.”

I cannot go better than Imperator Fish’s attempt to explain in what circumstances a tax cut would help.

Tax relief is Simon’s answer to every problem. But he may have a point this time. As our society inevitably collapses from the weight of the many economic and social shocks triggered by Covid-19, and as small communities of wretched people cling to life amidst the rubble of our once-mighty cities, scratching through the ruins for something, anything to eat, and fighting other groups to the death for what few resources remain – sometimes with little more than sticks and clubs as weapons – it will be some comfort that marginal tax rates have reduced.

National’s approach is to brazenly try and gain political advantage by attempting to use a pending crisis to push an ideological solution that will not work and will not improve things.  Shame on it.

64 comments on “Bridges thinks the solution to Covid 19 is tax cuts ”

  1. Robert Guyton 1

    When this was discussed in the House yesterday, Jacinda batted Simon about the place like a chew-toy.

  2. Sabine 2

    Simon does as the National Party always does. Tax cuts. And faith based health care for those that can't afford anything better. Heck, if he gets is marching orders from like minded people in the US for example than he will know that Mitch McConnell is holding up a bill in Senate (approved by R and D in Congress) because it does not allow for profit making for the poor Pharmaceutical Companies.

    But what is Labour doing really?

    https://www.rnz.co.nz/news/national/410936/coronavirus-govt-moves-to-remove-income-support-stand-down-period

    Economic Development Minister Phil Twyford visited the East Coast yesterday; the forestry industry is being hit hard by export restrictions.

    The minister met with families and workers at breaking point, the situation for many forestry workers in Tairawhiti.

    Today at Parliament when asked about their pleas for help, Twyford told reporters the government was working as fast as it could "to see what of the ideas that were pitched" to him during his visit.

    "We know it's urgent, the social consequences of people being without jobs, often facing debts, are pretty dramatic – we're on the job".

    Well tickle me silly, but it is really really reassuring that they do know that people without jobs and money face pretty dramatic hard ship. Yei!

    But the ministers were not considering direct cash injections, he said, other than what was already on offer from the Ministry of Social Development in the form of jobseeker and hardship grants.

    Well they may know that hardshipt is cause by lack of money, but you just got a 3% increase starting in 6 weeks, thats an extra 10.44 on average before tax (yes, beneficiaries pay taxes on their earnings) and that is gonna do a huge difference in the local economy when they are using these $ 8 dollars after tax to buy two loaves of bread.

    Ardern said New Zealanders had a role to play too.

    "Good hygiene, staying home when they're unwell, making sure they wash their hands, catch their cough, those are all things that do make a difference", she said.

    She said the case showed that not all Covid-19 cases would require hospital treatment.

    "Self-isolation in these cases is of course one of the most effective things we can do to stop the spread of influenza-style illnesses … there will be cases that will be mild-to-moderate and can be appropriately dealt with at home."

    Brother, have you got some spare cash laying around to pay for two to several weeks for of 'self – isolation' (a much friendlier term then quarantine), have you got some spare cash for food while you 'self – isolate'? Enough to buy pampers? Baby food, n such? Or should they apply for a hardship grant that they then can spend the next 10 years repaying $ 5 a time?

    Again, i don't care what Simon does, he will do as he always did, sprout some nonsense. But i would like to know what our current suits have planned for us, and sadly the 3% increase for beneficiaries will not create a wee trickle to keep small businesses afloat, nor will it push the beneficiaries into a better space.

    So Micky, here is a challenge, write a long long post, with lots of supporting material about the Government response to a. how will self isolation aka quarantine be managed, how will the government deal with Landlords that want to evict people who fell behind with the rent cause 'self – isolation', how will the Landlords deal with electricity companies that want to cut of the juice to people who may not have enough money to eat, pay rent, and utilities while 'self – isolating', who will the government deal with people who may not have enough money to buy food to 'self – isolate'.

    As for the tax cuts, Labour and the coalition could have choosen to make the first 15 – 20.000 $ of income tax free and thus would have been able to shut Simon down, but they did not. But yeah, a 3% increase in benefits and a dollar increase in the min wage. To little to live, to much to die on.

    • Craig H 2.1

      Minor point – tax on benefits and super is calculated on the net figure, so an increase in those rates automatically includes the additional amount required to cover the additional tax.

      Agree that the rates need to be much high though.

    • Sacha 2.2

      write a long long post, with lots of supporting material about the Government response

      We would need to see the latter first. And they had better not dick around until May cos election year Budget.

  3. Wayne 3

    Tax cuts are an effective way of getting more money immediately into people’s pockets. If properly designed just about all taxpayers will get more money. The intent being that they spend and boost economic activity beyond what might otherwise happen. Much easier to do than just about anything else.

    It is typical of the Left that this logic escapes them.

    Obviously it is not the only thing that should be done, but it is one of the main tools in the governments tool kit if they want to boost economic activity. And in the current circumstances it is pretty clear that economic activity needs an immediate boost.

    • Blazer 3.1

      Raising the minimum wage and wages in general would be more effective would it not?

      I mean for ordinary people, not managers and corporate dillettantes.

      • Nic the NZer 3.1.1

        Raising the minimum wage sees the cost passed on to employers of those staff. While many employers of minimum wage staff can afford a more equitable distribution of business income the impact of the fall in economic impact is not being compensated. So no, an increase in the minimum wage is not going to have more impact than a well targeted tax cut. In practice studies have found it hard to measure the economic impacts due to minimum wage changes.

        A tax cut increases wages in general of course.

        • Wayne 3.1.1.1

          As I recall, in Australia during the GFC, the Rudd government simply sent everyone $1,000. Presumably everyone over 18.

          The intent being to get people to spend. It worked. In NZ that would be around a $3 billion expenditure. Very simple to do, in the same way as a tax cut is simple.

          Probably not yet the time to do something like that. The current emergency is not dire enough.

          But it might be in the next month or so. It could be done as part of the Budget, when it might be very necessary.

          • Paul Campbell 3.1.1.1.1

            Given that the IRD just got rid of cheques it would be a CF, it would take months to get everyone's bank details down so that they could send the money (rather than a 2 day print/mail run of cheques)

            • Craig H 3.1.1.1.1.1

              IRD has most people's bank account numbers already, and no doubt a news story would get a few more.

          • bwaghorn 3.1.1.1.2

            If got a $ 1000 from the government it would go straight into my shearsies account .

          • Blazer 3.1.1.1.3

            What did they spend their 1000 on?

            So called 'consumer confidence' relies on them buying on credit,believing they can pay off their debt.

            Funnily enough with record low official interest rates,credit card rates are still in the mid to late 20's.

      • Wayne 3.1.2

        Raising the minimum wage would have the complete opposite effect of helping the economy. It would hit the retail and hospitality sector hard. These are the very businesses (often small businesses) that are struggling as demand dries up.

        That is why an emergency like this requires government to either spend more, and/or reduce the tax take. If the Left don't like a tax cut, then a one off payment to all adults would also work. That is what the Aussies did in 2008 in response to the GFC.

        • Ross 3.1.2.1

          Wayne

          You don’t appear to know much about the minimum wage.

          Here are the thoughts of two economists soon after the Employment Contracts Act was passed by your mates.

          “much of the political justification for the new legislation has been based on a simplistic model of labour market adjustment. This has led to the assertion that the new regime will increase productivity. In particular, the Minister of Labour argued that productivity would be enhanced by removing the restrictive work practices of the award system (New Zealand Herald, 21 January 1991, p.6). However, apart from anecdotes of dubious significance, there seems to be little evidence to support such a proposition (Harbridge, 1990). Traditionally, a significant proportion of employers provided employment on terms and conditions over and above those stipulated by the award. Only a minority of employers, often the very worst, were actually constrained by the award system. This is backed up by a recent survey which indicated that many small employers felt contented with the previous system of industrial relations. The researchers argue that ‘…most of these [surveyed] employers function basically unencumbered by unions or the labour relations system. This majority are untroubled by the national award system’ (McAndrew and Hursthouse, 1991, p.9).”

          https://ojs.victoria.ac.nz/nzjir/article/download/3105/2760

          • Wayne 3.1.2.1.1

            We are talking an emergency situation here where the economy is contracting, not a BAU situation. That is why increasing the minimum wage would be the wrong approach in the current circumstances.

            • Chris 3.1.2.1.1.1

              What are the circumstances in which raising the minimum wage is the right thing to do?

        • Sacha 3.1.2.2

          a one off payment to all adults

          A payment to NZ's poorer people but not the richer ones would be more bang for buck. Will all be spent promptly and locally.

        • KJT 3.1.2.3

          Bull. Right wingers seem to totally misunderstand anything more than simplistic answers.

          Raising wages helps local businesses. One. Because most of the low wage payers are not local. Big box stores and the like. Two. Because local employees are also local customers.

          Getting rid of GST, is also beneficial to local business.

          The effect on small business, of welfare payments to a community was proven with the effects on Northland and businesses of Richardson's welfare cuts. To state just one of myriads of examples.

          We are still paying for National's tax swap, in decaying infrastructure, insufficient housing, failing education, the health and social effects of poverty and the breakdown of social cohesion.

          Tax cuts for the already rich, and lowering wages and welfare, doesn't work. Trickle down is a proven failure.

    • bwaghorn 3.2

      I believe you if I thought for a second that bridges understood that giving a $1000 tax cut to a high earner will not achieve an increase in domestic spending . And that giving a $5 tax cut to low earners will also achieve fuck all .

    • Nic the NZer 3.3

      Agree. Mickeys post imports a wide range of fallacies and even at points contradicts what the quoted authors say to layer in additional fallacy beliefs.

    • Ross 3.4

      It is typical of the Left that this logic escapes them.

      A tax cut typically benefits the wealthy more than any other group. I note that you didn’t try to argue why the wealthy should get a handout from the government.

      • In Vino 3.4.1

        Thank you, Ross. The truism that all tax cut proponents ignore – because they are righties who always favour the Rich.

    • Muttonbird 3.5

      If you cut taxes every time there is a virus or a downturn you'll soon be at zero tax.

      It's very difficult for governments to raise taxes if they want to stay in government and so it would be very difficult to raise taxes once the emergency had passed.

      The last time National were in government they made an art form out of gutting social services and they would do so again with bells on if they had less revenue with which to do their job.

      • Stunned Mullet 3.5.1

        "It's very difficult for governments to raise taxes if they want to stay in government and so it would be very difficult to raise taxes once the emergency had passed."

        Perhaps they should take a lesson from local government ?

    • Descendant Of Smith 3.6

      "Tax cuts are an effective way of getting more money immediately into people’s pockets."

      Unless those people happen to be on benefit. We should remind ourselves that not only have benefits not been kept at a reasonable level not a single tax cut over the years has benefitted them.

      In Wayne's world beneficiaries are clearly not people.

      Fuck me if two Royal Commissions, Helen Clark's duplicity in putting Ruth's cuts back on NZS but not benefits which could easily be righted as the NZS fix sets a precedent, a WEAG report, a crisis that needs the local economy stimulated, rising rents, loads of support from advocates and media to do so doesn't give this Labour Government licence to immeadiately increase benefits what the fuck will?

      Oh that's right they are too busy removing the rights of superannuitants to include their underage partners and taking 25% of the benefit off vulnerable people in emergency housing. They are actually reducing peoples benefits.

      What a bunch of wankers Wayne and Labour. Fucking tax cuts when we have so much poverty around for our most vulnerable.

      But you know you got to be cruel to be kind!

      Oh, I can’t take another heartache
      Though you say you’re my friend
      I’m at my wits’ end
      You say your love is bona fide
      But that don’t coincide
      With the things that you do

      https://www.youtube.com/watch?v=b0l3QWUXVho

  4. Bill 4

    Trump's on the same page. Tax cuts.

    https://www.youtube.com/watch?v=OFP2aZaCk0o

    • KJT 4.1

      Raising Government spending, on infrastructure, welfare, housing, health and education, is an even more effective way of "getting money into peoples pockets" which has long term beneficial effects for everyone.

      Unlike percentage tax cuts, which reduce Governments ability to act and, like percentage wage rises, increases the inequality gap, and the amount of people without enough to live on.

  5. Byd0nz 5

    Same old, same old, tax cuts for the greedy,

    fuck-all for the needy

  6. dv 6

    The last time they tried that they increased GST!!!!

    • Nic the NZer 6.1

      Would be a good govt policy to cut GST by around 2.5 to 5%, I think.

      I agree Nationals TAX NEUTRAL tax cuts slowed the recovery from the GFC.

      • Incognito 6.1.1

        I don’t know if this is technically feasible but what do you think of a temporary GST cut, e.g. for one year? It would encourage spending more within that period because of “available for a limited time only!”.

        • adam 6.1.1.1

          Do you support flat taxes, which hurt the poor? You understand the economy can work without flat taxes, which hurt the poor? That the economy for much of the 20th Century did not have a flat tax, which hurt the poor?

          So why did you imply it was not "technically feasible" do support taxing the poor more via a flat tax? The only other thing I can think of is technocrate shitfuckery, and your not into technocrat shitfuckery are you incognito?

          If your offended – follow the link

          • Incognito 6.1.1.1.1

            I was going to reply about flat tax and GST but I don’t want to pre-empt a response by Nic the NZer whose opinion I do value, especially on these kinds of matters, which is why I ask him. Further, I asked a specific question to which I and obviously neither you don’t know the answer.

            That said, you seem to have a problem with reading and interpreting comments from others and your comments with shitfuckery strawmen (and) about imaginary strawmen are getting tedious.

            If your offended – follow the link

        • Nic the NZer 6.1.1.2

          Possible of course. Its important to understand that the govt is never short of money, its always a question of the govt being short the other side of the balance sheet (the ability to command real resources) and we should structure taxes to reflect that concern primarily.

          • Blazer 6.1.1.2.1

            Why did the Key Govt borrow around 80 billion if they are never short of 'money'?

            Is borrowing to fund tax cuts a good idea?

            Who did they borrow the money off?

            • Nic the NZer 6.1.1.2.1.1

              Govts borrow to maintain monetary policy. When they spend the reserves (what they spend) end up held by NZ financial instititions participating in the interbank market. After a lot of spending then there may be more reserves than needed there. The result typically will be the 90-day interbank rate starts to fall towards zero and away from the RBNZ monetary policy rate (these are both shown on the same chart by the RBNZ). So the govt locks the spending up in longer term debt (but paying a higher interest rate than interbank lending) allowing the RBNZ to conduct monetary policy. So the govt debt ends up owed to large NZ financial institutions but ultimately in some sense deposit holders at those institutions.

              But, the govt can't be short financially as it runs the payments system.

        • Nic the NZer 6.1.1.3

          Also you should not think too strongly of the govt directing the economy on the finance side, its much more that the economy dictates to the govt what shape its budget will be in.

          National had little choice about the scale of post GFC deficits, the govt tax collection just fell away and expenditures went well up.

          The mechanisms here are called automatic stabilizers for that reason. The stronger they work the more stable the countries longer term economic performance will be.

          Adam kind of has a point too, though he could be more polite about it. The country has never had to have a GST tax that has always been a choice. 2.5% to 5% is just a small safe change which I see being possible.

          • Incognito 6.1.1.3.1

            Ok, thanks.

            It seems there are many similarities between the GFC and the unfolding COVID-19 crisis. However, there are differences too and I don’t know if the same (kinds of) measures should be considered and/or are equally effective (or ineffective as they may). COVID-19 seems to be more of a ‘moral crisis’ at this stage, at least in NZ.

            To get back to Adam’s poorly worded comment, GST might be a flat tax in terms of consumption. Strictly speaking, the consumer don’t pay (the) GST; they get it passed onto them. However, when viewing GST/consumption in relation to income, it can be seen as a regressive tax.

            Whether there’s a need for GST or not is a moot point IMO; the current rate is 15%. In relation to effective measures to deal with the economic impact of COVID-19, scrapping GST altogether is not on the cards.

            A GST cut for a fixed period of time will affect the Government books for a limited time, although the effect might have a long tail.

            • Nic the NZer 6.1.1.3.1.1

              The reason for the similarities are easy to understand. So far we are just talking about a fall in overseas demand so fiscal policy is a response.

              If you look at the sectoral balances break down of GDP you can simply understand why GDP falls in response to this shift in trade and also why a corresponding shift in the govt fiscal balance (maybe via a tax break) can compensate that shift. The main difference from the GFC being there was also a significant shift in spending inside the domestic sector of the economy which caused GDP to fall in that case.

              • Incognito

                The main difference was the focus of the fear; not all fear is the same and experienced by the general population (AKA ‘average Joe/Jane’). Investment dries up vs. consumption dries up; different drivers.

            • adam 6.1.1.3.1.2

              Your response has confined the debate within the limited scope of liberalism. In the realms outside liberalism, there is whole other ways to look at economics. Ecological, mutualism, worker directed, just to name a few.

              I thought you were the great defender of expanding debate Incognito, you have done nothing but shut it down by embracing the conservative narrative of liberalism.

              How does that help working people? My poorly worded shitfucker made a joke of you already walking down that path. Hence why I keep asking, why do want to hurt poor people – half in jest and half seriously.

              And there's the rub, that is the core problem with liberalism, it so normal most people can't even see when they use is it. And the point of the left, in MHO is to enhance the lives of those without power, and liberalism can't do that.

              So rather than cut you off at the pass, I failed, and for that I apologise. For you taking offence – well not much I can do about that. Except to say – be offended – it won't kill you. To soon with my sardonic wit??!?

              • Incognito

                Sometimes, a specific question is just a specific question.

                There’s no point trying to play chess with Don Quixote because to him all pieces look like windmills.

      • Wayne 6.1.2

        Nic,

        Complete nonsense. New Zealand was one of the first countries to come out of the GFC and the tax package was one of the reasons.

        • Nic the NZer 6.1.2.1

          According to Bill English it had net zero tax impact. So it can't have worked like Australias response (as you alluded to above). So the evidence is entirely consistent with NZ just having a relatively small collapse due to the GFC.

          Swapping higher band PAYE where the stimulus goes into savers pockets for GST which impacts all spenders is also clearly likely to slow the economy of course.

          Of course I didn't say the National party caused the NZ GFC recession with its tax swap however that would be consistent with multiple examples now of Japanese sales tax hike induced recessions.

        • Ross 6.1.2.2

          New Zealand was one of the first countries to come out of the GFC and the tax package was one of the reasons.

          The main reason was that in NZ the effect of the GFC was relatively small.

          “In August 2008, the New Zealand Treasury announced that the country had entered into a recession. The economy had declined by 0.3% in the first quarter of 2008…The economy emerged from recession in mid-2009, with the second-quarter GDP report showing the economy grew by 0.1 per cent on the March quarter.”

          https://www.canstar.co.nz/home-loans/global-financial-crisis-what-caused-it-and-how-the-world-responded/

          “In New Zealand and Australia, problems in the core banking system during the crisis were comparatively mild, reflecting our more vanilla-flavoured banking sector and relatively sound bank capital structures. There was little exposure to complex instruments and opaque

          • Ross 6.1.2.2.1

            The above should read:

            ”In New Zealand and Australia, problems in the core banking system during the crisis were comparatively mild, reflecting our more vanilla-flavoured banking sector and relatively sound bank capital structures. There was little exposure to complex instruments and opaque interconnections in our markets.”

            https://www.rbnz.govt.nz/research-and-publications/speeches/2012/speech2012-08-09

          • KJT 6.1.2.2.2

            Mostly thanks to Keating's tight regulation of the Aussie banks, and Cullen's refusal to waste a surplus, on tax cuts for the rich.

            Imagine if it had been National in power before the GFC. We wouldn’t have fared so well.

            • Nic the NZer 6.1.2.2.2.1

              You've been had. Surpluses don't bolster the banking system against financial crisis at all. They also don't improve the govt ability to deal with them. What surpluses do do however is restrict NZs domestic savings rate and play well in NZ politics.

              • KJT

                What they do, is enable Governments to spend, without being beaten up in the news by right wing reporting.

  7. Ad 7

    Most disappointingly due to the virus hey have shifted the release date of the new Bond movie.

    Clearly it was

    No Time To Die

    😊

  8. AB 8

    A useful question would be to ask Bridges to describe the economic conditions under which he (and all his predecessors and successors) wouldn't recommend tax cuts. The honest answer would be "none". Because it isn't an actual economic policy at all – it's an ideology. No journalist will ask that question.

    In the current situation there is a case to be made for tax cuts to keep demand going in the face of Covid-19. It's a better option than another stupid interest rate cut – which will just see more virtually free money piled into the housing market – re-inflating that bubble and robbing future generations blind.

    A tax cut is ok, as long as the money goes to the people who will spend it here -which means beneficiaries, the working poor and the struggling working/lower middle class. So cutting taxes at the bottom end and raising them at the top – meaning that the well-off get virtually nothing and the bulk goes to the bottom. Alternatively – cut the regressive GST. National will not do either of these things ever – because for them tax cuts is not an actual economic policy, it's an ideology.

    • I Feel Love 8.1

      & that is probably not what Bridges or Wayne are really wanting when they say "tax cuts!".

  9. the other pat 9

    and if you are employed and say have no sick leave or just started and have no annual leave and are off work for a minimum 2 weeks?…..what does joe average do then……no employer or government assistance…or families where one member gets it so they all have to self isolate and they ALL are the financial contributors and say no income coming in at all…

  10. "Just a second Mr Bridges how will it help the Crayfish industry if the economy had been growing at half a percent more, they’ve lost their market."

    Translation: "Just a second Mr Bridges, are you a complete fucking moron or just taking the piss?"

    " Well fundamentally families would have more money in their pockets."

    Translation: "I'm sorry, my script only has these glib platitudes on it so I can't answer your question."

  11. infused 11

    I think you will find it's a whole bunch of tax-related things as well as projects.

    I posted in Feb that this would have a big effect on the NZ economy. We started seeing this in early feb when the shortage hit IT (HP factory is directly in Wuhan). China is producing again but has a massive backlog and only shipping at low levels.

    Our export sector is a bit fucked. I understand our export certs from feb are down 90%. Fontera has been dumping as well as live trade such as crayfish.

    This is going to come home to roost next month.

    • Graeme 11.1

      I understand our export certs from feb are down 90%

      I had to get an export entry last week, normally it takes 3-4 days from when I email our broker, had it back in 10 minutes…

      The consignment to USA would have normally taken 3-5 days dispatch to delivery, it was there in 2 days. Sod all moving, anywhere.

  12. Adrian 12

    The forestry problem is an interesting case. Even without The Virus ….aaargh…, logs would not be exported at previous levels. The wharves in China are over loaded with a huge amount of Scandinavian timber because a mild winter has seen a huge insect problem hence a lot of logging while the trees still have some value as well as emergency cropping of fire damaged trees in Australia sent to China to try and get some return from them. Combined with the normal slow down due to Chinese New Year's 3 or 4 week holiday has seen the problem multiply. There were layoffs and go slows well before the outbreak.

    True reporting in this country is piss poor.

  13. Bridges thinks the solution to everything is "tax cuts" except when it's "more roads"

    An d yet these are two things that are mutually exclusive, you can't have both, you can have more roads and more taxes to pay for them, or tax cuts and drop roading maintenance to help pay for that

  14. JoeTheLion 14

    Tax cuts would be good though, for any reason. The government is greedy.

    [I have changed the user name to the one you used last time as the one you had picked this time is already in use by a regular commenter. Please stick to one user name from now on, thanks]

  15. pat 15

    Bridges thinks the solution to everything is tax cuts….and Bridges is a moron, but 45 odd percent will vote for him regardless

  16. Peter 16

    Bridges on RNZ this week again used his fave, 'comprehensive plan.'

    I do not understand why the interviewers are too weak to ask him about National's' comprehensive housing plan' and how that went.

    Simon needs to develop a comprehensive plan about how to not come across as a comprehensive fool.

  17. JustMe 17

    SURPRISE.SURPRISE!!!!! National and especially Simon Bridges yet again seem to be 'experts' on EVERYTHING and have an ANSWER AND SOLUTION FOR EVERYTHING.

    Did Simon Bridges learn from the textbook of John Key who always had an answer for everything but when questioned deeply by say John Campbell turned out to be a Speaker of Gobblygook and other Bullshit.

    The NZ National Party are a train-wreck and even their leader is a mess of a person. He is not logical in thinking but then perhaps that well explains why National are in such a mess. They may as well pick which deck chair to sit on at the stern of the National Party Titanic.

    And so because Simon Bridges and even David Bennett have this almost hypocritical "I am more holier than thou and so you MUST HEED MY words….." mantra in whatever they say I don't bother listening to them.

    They, National, don't merit a vote because of their attitudes in speaking down to people. It's shows how arrogant they ALL are. I for one will not be voting for them at the next election. They are thoroughly and completely NASTY through and through.

  18. KJT 18

    Nationals new "economic plan". Same as their old economic plan. Cut taxes to the rich, sell tax payer owned assets to their cronies on the cheap, run down infrastructure, housing health and other Government services. Rely on insurance from natural disasters, and immigration, to give the illusion of economic competence.

    If all else fails. Repeat lies constantly and in unison. Because if enough people repeat it, it is "true".

  19. millsy 19

    Wayne and Simon follow the teachings of the Gospel of St Paul (Volcker) – "The living standard of the American (or Kiwi) worker must decline".

    Tax cuts, which will almost certainly starve our health and education systems of much needed revenue, is one way, of pushing down those living standards.

    Perhaps reversing National's hike in the prescription medicine co pay back to $3 is an option, so people can actually afford to get their meds.

    Of course, Wayne will not support that. He has long been in favour of imposing US style healthcare on this country.

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