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Written By: - Date published: 6:05 pm, September 10th, 2011 - 12 comments
Categories: debt / deficit, economy, Media - Tags:

I’ve just read Vernon Small’s piece today and I actually learned things from it, other than opinions plucked out of thin air by the author. Small explains the fiscal and economic challenges now existing that the next government will have to cope with and, with a nod and wink, tells us National is going to push out its date for getting back to surplus.

12 comments on “Counterpoint ”

  1. And if you look at the latest commentaries from Greece, Italy and Spain, his predictions take on added pungency.

  2. Lanthanide 2

    This should be something that Phil Goff hammers before the election. That National will be pushing out their date to surplus if they’re elected.

    Sing it loud and high from the ramparts.

    Then if Labour lose, when National do it, they can clearly say “I told you so” to the electorate.

    • The Baron 2.1

      … But they can’t do that, Lanth, because Labour plans to push it out even further themselves. What, with all the billions in extra spending/borrowing team Goff has already promised, and frankly mythical ideas on the revenue side to plug the gap, we would never be in surplus again under the labs.
      Doesn’t strike me as a particularly credible line to run at all.

        • The Baron

          What has your vainglorious comment got to do with Labour’s massively irresponsible spend up, Draco? How will Labour’s massively irresponsible spending and borrowing increase address the current deficit timetable problem?
          I note that they, along with oh every other economy in the world, haven’t signed up to your idea of printing money without consequences – so I am at a loss as to how your egotistical comment linking is relevant at all?
          Laughing at you some more right now.

          • Afewknowthetruth

            The Baron.

            Presumably your online name is indicative of your attitude, and that you believe in a feudal society in which the fruits of the labourung of peasants are transeferred to a tiny minority of ruthless thugs who maintain their privileged positions through manipulation and violence.

            You may be lughing now but you won’t be laughing much when unemployment reaches 30%. fiat currencies are worthless, the markest ahve collapsed and there is little to eat (except other people), as will certainly be the case if the present system of rape and pillage by a tiny gang of ‘elites’ continues for much longer.

      • deservingpoor 2.1.2

        “Labour’s massively irresponsible spending and borrowing”
        1) You seem to be keen to label Labour as the borrow and spend party when in actual fact Labour left office having implemented their “wild tax and spend policies” with a 2 billion dollar surplus. The fiscally responsible Nact government with their good old fashioned 19th century presbyterian austerity rhetoric (which kiwis fall for far too easily) have left us with a massive deficit.

        2) Here’s how an economy works. I go to work, I get paid, I pay taxes and I buy stuff which means other people get paid and pay taxes and buy stuff and so on. Now If I lose my job in say the public service, I don’t pay tax and I don’t buy stuff, which means that the people I used to buy it from don’t get paid that money and so on. If that happens to enough people, you end up with a depression, regardless of how many right wing dickheads go on blog sites with their chests puffed out going on about how those weren’t real jobs anyway.

        Labour (for all their faults)at least understand that to run society costs X number of beans. If you give away X number of beans to your rich mates, you won’t have enough beans to run society. If you drop the 19th century Presbyterian austerity bullshit and stimulate your economy when you need to, you get more people giving you more beans and you are able to spend more beans. They applied this principle when they were in government until they got voted out for bringing in almost full employment and running a surplus, which the right wing somehow managed to spin as collapsing the economy.
        For all their failings (and they have many) Labour at least have some plan to increase revenue, National have no plan at all.

    • mik e 2.2

      Labour could use financial transaction tax to pay our debt down earlier !

  3. Jum 3

    I’m sure Red Alert won’t mind sharing this comment.

    ‘John W says:
    September 10, 2011 at 10:48 am

    Such a short memory and selective at that.

    Who warned National about the folly of tax cuts – Cullen

    Who set up Kiwisaver – Cullen

    Who finally had to give into the greed of rightwing clamour for tax relief – Cullen with a fresh round of warnings about the folly of any further tax relieve.

    Who ignored that sound advise and gave billions away to their rich mates – Key.

    Who told lies about the money for rich mates tax cut being fiscally neutral – Key

    Who follows the Neo Con path of destruction for the sole benefit of a select tiny rich group, mainly transnationals, who control the press and minds of the less nimble – Key

    Who plays good cop to the public with a Brash, various puppet advisory groups puppeting adversity extreme – Key

    Roger Douglas must be a Hero for some who never carry responsibility for the nation but are willing to actively support job cuts. Pathetic class discrimination also proven to construct longer term harm to the economy.

    The myth that there is ” a limited pool of money ” is typical of limited thinking.

    The nature of money allows banks and “investors” to proliferate unearned profits causing inflation to devalue all our work and accumulated life support systems.

    The fiat system is the greatest parasite in our midst and money is not limited at all.

    Constriction of supply is controlled largely by design often not for public good but for wide scale plundering of community resource.

    Cutting jobs is a crazy short term recipe for long term shift of wealth to the top small group. No shortage of money there but an excess is disgusting proportion with no responsibility to those who have provided that wealth – the largest part of the community with little benefit or justice.

    If real productivity is sought then the Co-operative model has a strong record with a side benefit of community development and local control. The human condition is vastly improved.


    Transnational corporation facilitate the opposite with bleeding of local resources and migration of community wealth to offshore conglomerates.
    An increasing proportion money feed offshore profit.
    The social fabric and community infrastructure suffer and losses there compound.’

  4. RedLogix 4

    At Steven Keen’s blogsite there is an an excellent item on Harry Dent. If you watch the video it would appear although the two men appear to have never met nor conversed, there’s a bit of a mutual admiration society thing going on… and given the astounding track record both men have in predicting economic trends that cannot be too bad a thing. The video is quite long but worth a watch because it factors in something we rarely talk much about:

    There is a handful of people around the world whose work I respect because it intelligently addresses facets of our current predicament that I don’t.

    The economic and demographic analyst Harry Dent is one of those people.

    Harry uses empirical data about consumption levels and population growth to accurately predict economic trends. A person’s consumption patterns change as they age, so information on the rate of growth of population and its age characteristics can be used to predict what consumption will probably be of a given commodity some years in the future.

    Of course this has to be combined with other data—about national income levels, etc.—but it is a reliable guide that Harry has used over the years to anticipate such things as the Japanese slowdown when other people were predicting a continuing boom there.

    Harry explains some application of his approach in this YouTube video—one example I like is why the age 42 is the peak age for buying potato chips. It’s because the median 42 year old male has a 14 year old child…

  5. Afewknowthetruth 5

    Continued discussion of mainstream economics has become utterly tedious because it is completely irrelevant.

    All current economic arrangemnts will have fallen over before 2015. Indeed, the collapse could occur later this year, depending on how quickly the eurozone disintegrates and how quickly America’s envrionmental disasters impact on the US economy.

    I liken mainstream economics to a sand castle on a beach: it doesn’t get demolished insantly when the first wave hits it but gradually crumbles as successive waves progressively reach further up the beach as the tide comes in.

    Peak Oil was over 2005-2006 and extraction is rapidly falling throughout most of the world.

    Sovereign debts have ‘gone exponential’ and most nations cannot even meet the interest payments, even though interest rates are at unprecedentedly low levels (the Bank of England just confirmed the 0.5% rate will not be changed).

    We are witnessing the end of the industrial age and a symultaneous collapse of the global environment. Every day that passes the ‘waves reach further up the beach’ and demolish a bit more.

    Unfortunately we have clowns and criminals in charge who still haven’t noticed (or know perfectly well but are lying every time they open their mouths).

    And a large portion of the dumbed-down masses are more interested in watching a ball travel up and down a rugby pitch/ tennis court/ golf course/ soccer field / basketball court etc. than their own futures.

    • Lanthanide 5.1

      “Continued discussion of mainstream economics has become utterly tedious because it is completely irrelevant.”

      I note that you currently make a living by writing books and selling them in the mainstream economy.

      So evidently you think the economy is relevant, or you wouldn’t involve yourself in it at all.

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