Cullen puts tax cuts in context

Written By: - Date published: 2:38 pm, February 7th, 2008 - 53 comments
Categories: labour, tax - Tags: ,

In a speech today to the Auckland Chamber of Commerce Cullen has further differentiated the role of tax cuts under National and Labour.

What was interesting about Cullen’s speech is that it wasn’t really a speech about tax cuts. It was a speech about (much broader) economic sustainability. Essentially it pitted National’s vaporware ‘tax cuts’ against Labour’s record and future plans on ‘skills and productivity, wages, innovation, exports, savings, infrastructure AND tax cuts’.

The PM has previously branded National an economic ‘one trick pony’. Cullen’s speech continued that theme.

Cullen left no doubt about his intentions: “Labour will deliver tax cuts because it is fair money that we do not need to meet our obligations to New Zealanders should not be held indefinitely in crown accounts.”

Increasingly short on wiggle-room, National’s response is likely to be twofold:

First, “Cullen’s made you wait eight years for a tax cut”. Second, “we don’t believe he’ll deliver”.

Neither is a credible political response. What this shows is a National Party unwilling to debate on the actual issues of the timing, shape and affordability of tax cuts. They haven’t outlined any kind of guidelines of their own, let alone an actual policy. On this and other important issues, we’re continually told “the policy is coming”. People’s patience is running out and an off-the-cuff policy on crab pots doesn’t cut it.

To use lines like these seems even more laughable when it turns out that, wait for it…

  • National in government have never ever cut the top tax rate.
  • National in government have never ever cut the corporate tax rate.
  • And National in government have never ever cut the tax rate on savings.

I wonder if the PM might have been being too charitable.

What do you call a pony without any tricks? A trickless pony? A no-trick pony? A gluestick?

Suggestions in comments please.

53 comments on “Cullen puts tax cuts in context”

  1. Santi 1

    “What do you call a pony without any tricks?”

    What do you call a minister (Cullen) without any credibility on tax matters? A blatant liar!

  2. all_your_base 2

    Rewriting the question does not earn credit santo. D- must try harder.

  3. Steve Pierson 3

    How is Cullen lying? Santi did you bother to read the speech or are your lines based on your prejudices?

  4. Daveo 4

    I don’t think Labour should be cutting taxes when there are still major social issues to deal with, but if we have to have them then I guess it’s better Cullen than Key.

  5. Should The Standard really take such delight in pointing out the following?:

    # National in government have never ever cut the top tax rate.
    # National in government have never ever cut the corporate tax rate.

    Counterpoised to this, is the fact that both the Fourth Labour Government and the Fifth Labour Government are instead the ones to cut taxes for the wealthy! So you guys seem to be saying over the last few months that “tax cuts are bad”, but “only Labour gives tax cuts for the rich”! Very interesting… Or is the new strategy to start saying that “tax cuts are good” now that Labour are promising even more of them?!

    I also see that Labour has announced their new found enthusiasm for private sector delivery of public projects. But wasn’t it The Standard that criticised National some time ago for the Nats’ private-public-partnership approach? I guess it’d be time for you guys to start selling the wonders of using the private sector now…

    I wonder if you’ve ever read “Animal Farm”? For some reason this blog reminds me of it from time to time.

    Bryce
    http://www.liberation.org.nz

    [lprent
    The posters have their own opinions. This is a multi-poster blog site run as a coop.

    There is no actual position of “The Standard” – well apart from when I want to kill off dad4justice or something like that. Half the time I don’t agree with the poster’s and I sysop the site. I’d expect that they are the same with each other.

    If you want to look for incoherence in opinions then look at the psuedonym of the poster. It is at the top of the post, if you’ve never bothered to look at it before. Making a blanket statement about a multi-poster blog having an opinion is just stupidity on your part.

    Lynn]

  6. East Wellington Superhero 6

    Hey guys,
    I have a question that you might be able to help me with.
    How do you spell “u-turn”?

  7. East Wellington Superhero 7

    Oh, and the public/private partnership in West Auckland is pretty classic too.

    Maybe we could rename Labour as “National lite”. Considering how much they’ve moved in the last 20 years it seems apt.

  8. Tane 8

    Hey Bryce, I agree with you on that one – I don’t think Labour should be cutting taxes and I don’t like PPPs. Unfortunately I’m too busy at the moment to do any posting. The trouble you have with labelling The Standard as having a position is that we don’t – we tend to bounce off each other and share similar views, but don’t take any one post as representative of all of us.

    In a_y_b’s defence, I think he was pointing out the hypocrisy in constantly calling for tax cuts and then voting against them when the opportunity arises.

  9. Steve Pierson 9

    I don’t like PPPs either and the announcement was only that the steering group for the tunnel project would consider a PPP. Frankly, I don’t see how it would make any economic sense.

  10. BeShakey 10

    Bryce – I took the point to be that National’s attacks on Labour’s credibility delivering tax cuts, and the supposed contrast with National’s desire to deliver tax cuts isn’t borne out by political history.

    Without knowing the positions of the Standard authors in detail, it seems at least possible to both oppose tax cuts, and believe that history suggests Labour has a history of delivering tax cuts while National does not.

  11. gobsmacked 11

    Of course, some people like to cut their own taxes:

    http://www.stuff.co.nz/4388967a13.html

    Funny how a corporate suit provokes less outrage on the right than the bogeyman benefit bludger. Despite the millions of dollars’ difference.

  12. AncientGeek 12

    Actually now you mention it.

    Did they ever change tax rates downwards? I’m sure that someone dropped a tax rate from 33 cents in the dollar to 31.5 cents a decade or so ago. Can’t remember who that was.

    I know that the 4th labour government managed to drop my father’s nominal top tax bracket from about 60 cents in the dollar to 33 cents.

    That would be an interesting exercise – when have the Nats in government ever dropped tax rates?

    Personally I don’t think that neither should be dropping tax rates unless they have covered the deficit that we’re likely to get when we get the superannuation bulge at or after 2030. It is easier for everyone to pay for that obligation in small amounts over time, than to suddenly either have to jack up tax rates or cut benefits later.

  13. all_your_base 13

    Thanks BeShakey, well read. Tane too!

  14. Charlie Tan 14

    Those National front cocksuckers on kiwiblog make me so angry!

  15. Billy 15

    “Those National front cocksuckers on kiwiblog make me so angry!”

    That’s the way, Charlie. Show them how to conduct a well-mannered, grown up debate.

  16. James Kearney 16

    It’s called spin-busting Bryce. He’s taking National’s carefully honed attack lines and deconstructing them for us, and I’m glad he’s doing it.

  17. dancer 17

    i haven’t paid particular attention to the work of PPPs but i did remember that we already had provisions for their existence – so let’s not pretend it’s totally new for Labour to talk in these terms:

    Paul Swain (Minister of Transport)Public-private partnerships are very important for New Zealand. They have been very, very successfully operated in other parts of the world. Before I hear all the comments that they will not work, the particular clauses in this legislation are based on the Melbourne link where lease arrangements are used to attract public-private finance in order to get a project built. (Hansard, 4 Nov 2003)

    I know the stringent conditions were the target of criticism, including tolls only where there was an alternatice route. But i did also spot this suggestion that current roads should be tolled. Do you think the speaker would still support that view?

    John Key: In the Transport and Industrial Relations Committee I argued vehemently that existing roads should be tolled.(Hansard, 4 Nov 2003)

  18. OK – I take the point that a number of commentors have made about The Standard not being a monolithic political voice.

    And, yes, I too enjoy the spin-busting that The Standard does… Whoops, sorry, I should say: “I too enjoy the spin-busting that individual authors in their own right do on this multi-post blog site”. But if you’re going bust-the-spin, you better be prepared to live with the contradictions that this raises about your own party.

    Tane – I’m glad to see that we agree about tax cuts and PPPs. But I have one genuine question about that (which I don’t expect an answer on right at the moment, as you’re busy): considering your opposition to these important issues, why don’t you ever post anything on this site about things that you disagree with Labour about? I’m not suggesting that you have any responsibility to do so, or even that such posts should be frequent, but wouldn’t it make The Standard a bit more interesting and credible as an independent voice if there was an occasional post of dissent against the party line?

    Bryce
    http://www.liberation.org.nz

    [lprent

    “your own party” – The posters here have admitted that they vote for different parties. I presume you’re talking about the NZLP. I think I’m the only person at the standard who has stated that they are a NZLP member. Most of the poster’s are far more left than I am. But the NZLP is a broad based party.

    There are posts that have critized the NZLP policy in whole or part, you might want to scan back. And I can’t remember a post that said anything about who to vote for.

    There are far more posts stirring the right – but they do provide a lot of targets for stirring.

    Lynn]

  19. The Double Standard 19

    Lynn – which author are you? Tane? Base? Bill? Or are you providing the official Party voice here now?

    [lprent – I don’t post. Time I had a look at your comments methinks. I seem to remember the moderators having problems with your trolling previously]

  20. gobsmacked 20

    I would have thought that a headline post describing Helen’s big speech last week as “Dull” was not exactly following the party line, Bryce.

  21. The Double Standard 21

    Gobsmacked – ever hear of tokenism?

    It’s pretty clear to any reader that Teh Standard is a Labour Good/National Bad blog. The occasional minor criticism of H1 doesn’t really change the theme.

  22. gobsmacked 22

    Bryce used the word “occasional” too. Point proved, thanks.

  23. r0b 23

    I would have thought that a headline post describing Helen’s big speech last week as “Dull’ was not exactly following the party line, Bryce.

    Not forgetting also the advice here recently to vote green!

    I’m only a commenter here, but I’ve also fessed up to being an active member of the Labour party. I’m of the opinion that Citizens should Participate in Democracy.

    But I have my criticisms of Labour. I think they have been too timid in their three terms in office. I would have liked to have seen more action on the environment, and a return to student grants (instead of loans).

  24. gobsmacked 24

    Comrade Rob, come with me.

    Don’t worry, your next-of-kin will be informed.

  25. The Double Standard 25

    Gobsmacked – What point – that you are an idiot?

  26. The Double Standard 26

    Lynn

    Remarkable that you are now moderating this blog and adding your opinion to comments without being an author. You must be a pro hacker eh? How long before you start silently editing comments?

    Feel free to label those that do not agree with your socialism ‘trolls’ if it makes you feel better.

    [lprent

    There is a level in WordPress called ‘Administrator’.

    The moderators and posters are ‘Editors’. They tend to ask nicely, give warnings, and ban on a semi-voluntary basis, ie they moderate.

    I’m the Administrator and I’m not known for being moderate – ask dad4justice. I get interested when I see people whose sole purpose seems to be to disrupt the site. At the comment level, I define that as they never contribute to the discussion, but appear to spend their time simply trying to make discussion impossible and to provoke flamewars.

    I’ve just scanned your comments back to december. I think you are borderline disruptor, so I’ll leave it to the moderators for the moment.

    Lynn
    ]

  27. Dean 27

    r0b said:

    “I’m only a commenter here, but I’ve also fessed up to being an active member of the Labour party. I’m of the opinion that Citizens should Participate in Democracy.”

    Unlike the Labour party, who have decided that 130 odd MPs know better than 80% of New Zealanders regarding the anti smacking bill. Not even a referendum will sway them – they know best.

    I guess if elected dictatorships are your bag then it’s definitely democratic, but you can hardly call a bill pushed through as a favour to a minor party – in return for favours – which faces opposition from 80 per cent of the voting public democracy in action, can you?

    And how about those tax cuts? Oh, the quotes from Helen and Michael that could be bought up now. Key’s dead rats must taste a hell of a lot better than Helen’s right about now, thats for sure.

  28. The Double Standard 28

    Lynn – gee, how generous of you. How many people have you banned so far? [BTW I think this is a legitimate topic of discussion since the authors here claim that Farrar only bans those he disagrees with. http://www.thestandard.org.nz/?p=616 ]

    [lprent – exactly one. dad4justice. He was posting very stupid comments with zero content using a number of psuedonyms. Sometimes his psuedonyms would argue with each other.

    I’ve started adding clarifications to comments that comment on this site, especially the ones that repeat opinions that have been previously asked and answered]

  29. r0b 29

    I regret that I have but one lifarrrrrrrghhhh……..

  30. Dean 30

    Lynn, is there any chance you can do a D4J style comment moderation for TDS?

    [lprent – I could. But I don’t think that he warrants the effort based on what he said in his comments. His burst of about 10 comments across a number of posts within a short space of time definitely attracted my anti-trolling attention. Had to go into the database to see them – the moderators deleted them.]

  31. Tane 31

    From memory Lynn hasn’t banned anyone. The people currently banned are Insolent Prick and The Prophet for repeated spamming, disruption and attacks on the blog owners, and Dad4Justice for, well, acting like Dad.

    Commenters from both left and right have been warned for their behaviour and had their comments deleted.

    Since moderation began the tone of conversation here has improved significantly, for both left and right.

    [lprent – no I’ve definitely banned d4j. His comments arriving in my mailbox for moderation have been ‘interesting’. However they got so interesting they started to go into the spam folder.

    Actually you’re right – I didn’t ban him. Someone else did – I just enforced it permanently]

  32. r0b 32

    Unlike the Labour party, who have decided that 130 odd MPs know better than 80% of New Zealanders regarding the anti smacking bill. Not even a referendum will sway them – they know best.

    Hang on – if memory serves – that bill progressed because of an agreement brokered by young John Key didn’t it? Isn’t he the one that knows best?

  33. Dean 33

    “Hang on – if memory serves – that bill progressed because of an agreement brokered by young John Key didn’t it? Isn’t he the one that knows best?”

    Key isn’t the one telling people a referendum echoing 80 per cent of New Zealander’s opinions is worthless because 130 MPs voted for it. But by all means keep blaming him if you wish – it seems to be doing Labour the world of good in the polls. Just dont let Helen on the radio again.

  34. r0b 34

    Key isn’t the one telling people…

    I must have missed this one Dean, would you mind providing a link to the original quote that you are refering to? Ta.

  35. Dean 35

    Helen said it on Radio Live, being interviewed by Willie Jackson, in response to him questioning her about her opinion on a referendum regarding the anti smacking bill. He asked her if she’d be willing to adhere to the results of a referendum given the polling numbers on such a large sample.

    She said no, she wouldnt, and that 130 odd MPs were right to pass the bill. Democracy, to the leader of the Labour party, only happens once every election cycle. Between times? It’s a dictatorship, no matter what the law is that’s being passed.

    Sorry I can’t provide you with any quites or sources ad verbatim just now, it’s nearly dinner time. But I’ll take a look later.

  36. Tane 36

    Just a note, there are not 130 MPs, let alone 130-odd.

  37. Dean 37

    “Just a note, there are not 130 MPs, let alone 130-odd.”

    Fair enough, my typo.

    The point still stands.

  38. gobsmacked 38

    In 1999, 82% voted, in a citizen’s initiated referendum, to reduce the number of MPs to 99.

    Why did this not become National party policy? Why did they ignore the wishes of 82% of the voters?

  39. Dean 39

    gobsmacked, you’re absolutely right. That is unacceptable.

    But don’t pass the buck. If this is the only defence you have then it’s pretty useless. National are bad and did it before is wearing pretty thin when Labour are doing exactly the same things.

  40. Tane 40

    Hey Bryce, I’m a busy guy and I do this in my spare time, so I don’t get to post as much as I’d like. When I do get the time I usually prefer to have ago at the Tories. Of course I have my issues with Labour, but I guess I don’t see it as my priority to attack them in the limited time I have.

    You’re right though in that the left does need to be critical of Labour, and if you have a look through my posts I think you’ll find I very rarely give them any unqualified praise. I’ll bear your comments in mind though.

  41. gobsmacked 41

    Two differences though, Dean:

    1) There hasn’t yet been a referendum. There may not be one, but in any case I doubt there will be 80% plus in favour (we’ll see), and I doubt the government (whoever it is) would ignore it completely (again, can’t know yet).

    2) The 99 MP referendum was smart, because it was specific. The planned referendum is not smart, it is vague. It could reasonably be argued that it endorses the status quo (the Key-Clark compromise). The wording could mean almost anything.

  42. Pascal's bookie 42

    ” He asked her if she’d be willing to adhere to the results of a referendum given the polling numbers on such a large sample.”

    What polling numbers are you talking about Dean?

  43. AncientGeek 43

    Dean: We don’t live in a pure democracy, and no-one in the world does. It is one of those nice theoretical constructs like an anarchist community, or a stable isotope past uranium 238 with a very long half-life.

    What we live in is a representative democracy. The difference between the two is that a representative democracy only expects a small proportion of the population (the representatives) to become highly informed on the issues of the day and the ramifications of each decision. A pure democracy would require that every voter was fully aware of the issues and the ramifications before they voted.

    This is clearly not the case in the referendum you’re after, and our representatives in parliament overwhelming voted for (only seven voted against) the Child Discipline Act, I can’t see any reason why a representative democracy should take notice of an ill-informed referendum.

  44. r0b 44

    Well the other Standardistas have pretty much buried that line of attack Dean.

    Democracy, to the leader of the Labour party, only happens once every election cycle.

    Representative democracy, as AncientGeek so clearly explained.

    I would point out, however, that for Key it seems that policy only happens as determined by the election cycle. Witness the dead rats. Why student loans? Because we lost the last election…

  45. outofbed 45

    AG
    you must be ancient indeed to impart such wisdom oh mighty one

  46. AncientGeek 46

    outofbed: to quote my father “but not senile yet, my son” just before he whipped my arse playing chess. He didn’t need section 59 as protection.

    On the 99 MP referendum. From memory the same thing happened there. Almost every MP voted for the Electoral Act 1993 to be passed Hunting for confirmation… Looks like I’d have to dig into Hansard for that one. Anyone got a link?

  47. The Double Standard 47

    “Had to go into the database to see them – the moderators deleted them.”

    I’m confused. Are moderators deleting my posts now? Unless I’m missing something I have only posted in this thread today (until just now on Kiwisaver)

    I assume you are looking at enough details to separate fake double standards from real ones?

    [lprent – it records IP numbers]

  48. Dean 48

    “Witness the dead rats. Why student loans? Because we lost the last election ”

    Cough, cough, tax cuts.

    Talking about dead rats isn’t exactly a good idea with Cullen’s latest revelation now, is it?

    And on the topic of representative democracy, plenty of other countries with such have binding referendums. I expect that’d let the haters and wreckers have too much power though, right?

  49. r0b 49

    Cough, cough, tax cuts.

    Nasty cough you got there Dean. You should try and get out in the fresh air more.

    Talking about dead rats isn’t exactly a good idea with Cullen’s latest revelation now, is it?

    Why? Labour isn’t against tax cuts. They are the party that just delivered company tax cuts. Who voted against those again? Hmmm – it was National wasn’t it.

    Anyway, I needn’t bother, ickystinky already nailed this one:

    Kiwiblog and our own chorus from the Right pews are on-message today that Cullen’s confirmation of Labour’s plans for significant and ongoing tax cuts is a U-turn. As if a Labour change of heart might somehow countenance Key’s wild flip-flopping. But in my book saying, “we will not do something until we can afford it,’ and then saying, “OK, it looks like we can afford it’ doesn’t seem like a U-turn. In fact, it just looks like plain fiscal management. Of course, it WOULD be a bit of U-turn if Labour was implacably and ideologically against tax cuts (which is the starting point for DPF’s argument). But tax cuts have been made under Labour! Which party last cut corporate taxes?

    http://kiwiblogblog.wordpress.com/2008/02/07/tax-cut-u-turn/

  50. That’s Rich
    The Tories just don’t get it do they? Making assumptions about low income people without ever having known what it is like to choose between school shoes and school lunches. In last nights “The Star’ Katherine Rich writes how Kiwis are feeling the pinch due to recent inflation pressures. Naturally this is all the fault of Labour’s policies and in particular Dr Cullen’s over taxation and poor fiscal management.

    read more http://faithfulleft.blogspot.com/2008/02/rich-and-poor.html

  51. Dean 51

    “Why? Labour isn’t against tax cuts. They are the party that just delivered company tax cuts. Who voted against those again? Hmmm – it was National wasn’t it.”

    National voted against them for some reason or another. I don’t quite recall what it was, but it was bound to be a silly one.

    But you can’t call a 3% tax cut anything more than a partial offset against increased costs such as a 4th week of holiday or compulsary and escalating Kiwisaver contributions. Now, no offence, but you can’t do this unless you’ve decided that you’ll ignore costs for an employer and instead concentrate on the parts that agree with your opinion the best.

    [lprent – sorry about the delay. d4j moderation trap. I must say he is persistent]

  52. Dean 52

    Lynn – never, ever apologise for delays in moderation because of a D4J moderation policy or process. I’m happy to be trapped in it if it means the likes of him are dealt with.

    [lprent – NP]

  53. Murray 53

    Fucken hell, is Micky going to give me a tax cut? Don’t do it Micky, it will probably hurt you more than it will hurt me.

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