@McFlock
Put this here because it was OT in thread.
For example, I tend to suspect (I’m not sure, it just seems reasonable on the face of it) that supply of money has some input as to its value, for which some social credit type folks have suggested I’m basically following rogernomics, and we can print as much cash as we want (billions) with no impact on the exchange rate or inflation.
It’s not just creation money though – you have to include it’s destruction. The cycle should go:
Government >> economy >> government
The money’s return to government is actually it’s destruction. Under those conditions then inflation can be minimal.
As for the exchange value – that needs to be set by a formula (essentially imports/exports) rather than the wishful thinking of the speculators.
Spend available for provision of government services is the amount needed to provide those services – no more, no less.
This spending then gets spent into the private sector causing multiplier effect (usually around 3 times).
Overall tax @ 33% to have return to government balance.
It would be government spending, including the UBI, that provides the entire money supply for the economy to work. This:
1. Removes poverty
2. Eliminates the business cycle
3. and removes the need for infinite exponential growth on a finite world.
why?…because you claim a tax rate of 33% and a multiplier of 3 …that requires a zero savings and import rate
and we don’t need savings? would love to hear your explanation of how anyone is going to purchase anything that costs more than say a weeks “wages”( while eating and being housed)…and that also suggests all ownership will have be by the state for there will be no ability for private investment…and placing it in a bank (even at zero interest) still removes it from circulation and negatively impacts ME
but the best of all is how you propose to administer the inevitable demand for more. and the inflationary spiral that creates.?..even in a totally closed economy which while possible is extremely unlikely
It’s not Money in >> Money out and that’s it, nobodies got any money and nothing happened as you seem to think.
and we don’t need savings?
No we don’t. Savings aren’t needed to buy cars. It’s supposedly needed to make investments but it’s not needed for that either.
And, of course, people would still be able to put money aside to buy larger stuff.
but the best of all is how you propose to administer the inevitable demand for more.
And how did I propose to do that?
and the inflationary spiral that creates.?
There’s no inflationary spiral as the money is balanced. Unlike now where the money into the system isn’t balanced resulting in high house price inflation.
your understanding of the multiplier effect which you cited..
Possible. The multiplier effect won’t be the same in a Sovereign Money financial system as in the current system.
I’m thinking that it would be more of a measure of how many transactions money will go through before it’s fully returned/destroyed. I was making an assumption, based upon the present multiplier usually being ~3, that it would be about the same.
Thinking about it some more that assumption is most likely low which means that the overall tax rate would be lower. Would probably need a FTT.
“No we don’t. Savings aren’t needed to buy cars. It’s supposedly needed to make investments but it’s not needed for that either.”
Didn’t mention cars, but if you maintain savings are not needed (though you then contradict yourself by stating monies can be put aside for larger stuff….otherwise known as savings) one can only assume that either the government will lend or gift monies for large purchases or that money itself will cease to be.
“And how did I propose to do that?”
you haven’t ….and that is the point.You have ignored the increasing demand by a society that only has to bring political pressure to obtain more or the same for less, how does your model propose to deal with that? This speaks to the inflationary spiral that would be created.
If what you have outlined here is a genuine model then you should at least be up front and admit the only way it would have a chance of successfully operate (at least briefly) would mean the end of private ownership, a completely closed economy that is likely to become increasingly unsophistocated and a totalitarian state that is mandated by the majority with no protection for dissenters….think we’ve seen where that leads..
So basically, you’re borrowing against the government’s income next year, as opposed to the government’s income this year. And if the money back doesn’t meet the money you’d spent, it’s inflationary.
How is that different from the standard bonds the reserve bank lends to banks? I can see why “lending” it to central government for infrastructure development rather than just to inflate the banking sector, but what you describe still requires conventional, basic budgeting, not a currently untapped source of revenue.
So basically, you’re borrowing against the government’s income next year
Nope.
Government creates the money
Spends it into the economy
Taxes money back out of the economy (destroys money)
No borrowing at all.
The economy is a continuous cycle.
And if the money back doesn’t meet the money you’d spent, it’s inflationary.
Nope. Growing economy requires a growing volume of money. Of course, sovereign money can also be used to turn the economy into a Stable State Economy.
How is that different from the standard bonds the reserve bank lends to banks?
These would no longer exist. Banks would not be able to borrow from the RBNZ.
Also, the government borrowing from the private sector would also not exist.
but what you describe still requires conventional, basic budgeting, not a currently untapped source of revenue.
But you said that to maintain the overall level at zero change (to avoid inflation), the government had to “destroy” a dollar for every dollar it created.
The money only does any good if the government spends it, gives it to other people. Pays a UBI, pays road workers, whatever.
To get it back to destroy it, the government needs to levy a tax or gain profit from a transaction.
You’re plugging extra money into the economy this year, but you need to avoid creating inflation by taking back a matching amount of money in taxes.
Let’s say you have annual tax revenue of 100bil in a country with a gdp of 300bil. You want to buy everyone a UBIferrari, at an additional cost of 40bil, so you print the required cash. Next year you need to raise $140bil in taxes and destroy 40bil of it, and your gdp is 340bil, so you’ve got ~12% increase in gdp and cash supply while the invented cash is still in the economy.
So you’re still left with government expenditure cuts or tax increases to maintain the monetary balance.
You want to buy everyone a UBIferrari, at an additional cost of 40bil, so you print the required cash.
But the government doesn’t buy everyone a Ferrari now does it? Really, why would you come up with such a stupid example?
What it does is spend money to provide government services (Police, justice, etc). and the UBI. These people now have money which they want to spend. They spend it into the private sector.
As the money moves through the economy it’s taxed in various ways (returned to government). These taxes result in the money being destroyed.
So you’re still left with government expenditure cuts or tax increases to maintain the monetary balance.
Which bit about the government spending being balanced by taxes didn’t you understand?
And, no, you wouldn’t have to cut government services – ever. In fact, doing so would probably cause a recession because the money that the government is spending is the full and total supply of money for the economy.
I really can’t make it any simpler.
Government creates money
Government spends money into the economy via government services
Government taxes money back out of the economy destroying the money
It’s not necessarily to finance government spending but it is necessary to keep money circulating, other wise it goes stagnant and festers in speculative property prices.
If Graham Hart spent the amount of money McFlock suggests in what’s called the permanent money hypotheses Graham would explode in 20 secounds because of the heat generated from spending, so Graham simply can’t spend that amount of money, the role of taxation is to put it back into the hands of those who will spend.
It’s not necessarily to finance government spending but it is necessary to keep money circulating, other wise it goes stagnant and festers in speculative property prices.
Or stimulus from deficit spending, or even cutting corporate taxes can cause inflation, (at the risk of receiving a ban for mentioning Trumps name) Trumpism, there are so many ways to boost demand, my point is if MrFlock would try google first he wouldn’t come across as such an asshole
I chose an absurd example (actually “UBIferrari”) because the what is irrelevant to the discussion: it could be a UBI, earthquake repairs, or a moonbase.
The fact is that you’re still tying government expenditure to government income. In a particularly inefficient way. Because, like most economic theories, your model is to simplistic.
You want to spend money now in order to tax it back later. But rather than doing it with bonds (and addidng a “debt servicing” line item to the annual budget that’s a small proportion of what you actually borrowed), by flooding the economy in new money you necessitate getting it back as soon as possible. The end sum might be zero, but in my example you’ve still increased the money supply by 40bil until you’ve taxed it back. And artificial boom/bust cycle.
And how would you tax it back – monthly or quarterly variations in PAYE? How would that effect folks’ wallets? Or annually bounce the tax rate 15% up or down depending on what you want to build this year? you reckon that’s electorally sustainable? Again, for simply the same result: government expenditure that’s constrained by government income.
You want to spend money now in order to tax it back later.
We’re not starting at zero. We already have the government taxing and spending.
But rather than doing it with bonds (and addidng a “debt servicing” line item to the annual budget that’s a small proportion of what you actually borrowed)
The government shouldn’t borrow money – ever. It has no need to as it can create money and not have interest charged on it. Just so long as it then destroys that money through taxation.
Why do people insist that the government has to pay interest on money?
The end sum might be zero, but in my example you’ve still increased the money supply by 40bil until you’ve taxed it back. And artificial boom/bust cycle.
And that is why your thinking fails. You think that the economy is static rather than a continuous flow.
Again, for simply the same result: government expenditure that’s constrained by government income.
Can you point me to where I said it would be otherwise?
What I said is that government spending through government services and the UBI should be the total money available to the economy. That this would stabilise the economy eliminating the ‘business cycle’ and poverty.
I don’t believe the economy is either static or a continuous flow.
I think there are lag times and elastic relationships throughout the economy, and my concern with your plan is that it causes a surge throughout the system, followed by a corresponding low pressure zone. And that causes more stress to individuals in the system, breaking some of them.
Whereas conventional tax/borrow and spend government policies don’t have that lag period where there’s a sudden boost in money supply on top of everything else.
and my concern with your plan is that it causes a surge throughout the system, followed by a corresponding low pressure zone
But it doesn’t and that thinking is that of a static model.
Whereas conventional tax/borrow and spend government policies don’t have that lag period where there’s a sudden boost in money supply on top of everything else.
The sudden boost in money supply that we’re seeing now is from the private banks creating huge amounts of money in lending for houses and offshore buyers of our housing.
Well, perhaps there is some niche economic definition of “static” – but I meant it in the conventional meaning of lacking in movement, action or change. Which is impossible in a system that has pressure waves, which by definition are change. But either way, simply saying that the model is “widget” doesn’t mean it’s wrong.
How does one create cash and avoid inflation in the period between when government pays the people and when it taxes that amount back off them?
The current boost in money supply is intentional policy by the reserve bank which is using a blunt tool to face a complex problem: a largely stagnant economy with one single sector that’s massively overinflated in price due to long term supply shortfalls.
That is a separate issue to whether your concept of printing (then destroying) money adds any advantage over the current conventions of managing government accounts.
How does one create cash and avoid inflation in the period between when government pays the people and when it taxes that amount back off them?
See, you’re thinking that one thing happens and then the next thing happens at a later time when both will be happening simultaneously. The former is static model thinking.
The current boost in money supply is intentional policy by the reserve bank which is using a blunt tool to face a complex problem:
Actually, it’s been the intentional policy of the government for the last ~30 years who legislated what the RBNZ was going to do, gave it the tools to do that and removed capital movement restrictions.
That is a separate issue to whether your concept of printing (then destroying) money adds any advantage over the current conventions of managing government accounts.
Actually, it gives advantage to the entire economy and not just the governments books:
1. By removing the private banks ability to create money it stabilises the economy from that direction. No more banks creating huge amounts and then panicking and stopping creating any thus throwing the country into recession/depression
2. They’ll be no need to borrow offshore to utilise our own resources as they’ll be plenty of money available
3. By ensuring that there is a constant influx of money into the system via the UBI ensures that there will always be a demand for businesses to supply
4. The UBI will ensure that everyone who wants to will be able to get a good education
5. The UBI will allow people to be entrepreneurial by ensuring that they don’t drop into poverty if their idea fails
6. The removal of interest bearing debt from government removes the need for continued growth
See, you’re thinking that one thing happens and then the next thing happens at a later time when both will be happening simultaneously. The former is static model thinking.
It seems to me that you’re trying to have it both ways: you said “As the money moves through the economy it’s taxed in various ways (returned to government). “. That means there’s a lag between when the money is distributed and when the same amount of money is finally returned via taxes. If there’s a lag then there’s a period of substantially increased money supply. If there’s no lag, then you’re not “creating” money, you’re simply transferring tax revenue into expenditure in exactly the same way it’s currently done.
Actually, it [“printing (then destroying) money”-mcf] gives advantage to the entire economy and not just the governments books:
1. By removing the private banks ability to create money it stabilises the economy from that direction. No more banks creating huge amounts and then panicking and stopping creating any thus throwing the country into recession/depression
Yes and no. It bypasses the fractional reserve system (which is merely a multiplier of the OCR tool, not an integral part), but that doesn’t mean that the banks will contribute any less to boom and bust speculative cycles.
2. They’ll be no need to borrow offshore to utilise our own resources as they’ll be plenty of money available
Borrowing, either directly or by simply printing cash and borrowing that off future taxpayers, is a sign of insufficient taxation right now.
3. By ensuring that there is a constant influx of money into the system via the UBI ensures that there will always be a demand for businesses to supply
That is a benefit of a UBI in particular, but yes does apply to other government expenditure if it’s done wisely. IMO most importantly the government expenditure needs to go into the regions so it can flow back into the urban centres then the corporates, rather than just swilling around a few key CBDs.
4. The UBI will ensure that everyone who wants to will be able to get a good education
Nah. That’s what the education system is for.
5. The UBI will allow people to be entrepreneurial by ensuring that they don’t drop into poverty if their idea fails
Fair enough, but this isn’t about the benefits of a UBI, it’s about how some UBI proponents intend to pay for it.
6. The removal of interest bearing debt from government removes the need for continued growth
but printing money simply substitutes interest payments for boosts to inflation. Growth is therefore still necessary.
That means there’s a lag between when the money is distributed and when the same amount of money is finally returned via taxes. If there’s a lag then there’s a period of substantially increased money supply.
Nope because the taxes would go up at the same time that spending goes up. If spending doesn’t go up then taxes don’t go up.
And we’re not starting at a zero point. We already have a monetary flow. There’d be a transition period when inflation may be a little higher than normal but I doubt if it would last long.
It bypasses the fractional reserve system (which is merely a multiplier of the OCR tool, not an integral part), but that doesn’t mean that the banks will contribute any less to boom and bust speculative cycles.
Yeah, actually, it does:
1. The banks will no longer be able to leverage minimal funds into massive loans. They’re strictly limited to what they have on deposit for on-lending and the people who so deposited it won’t be able to spend it either thus removing that piece of leveraging as well
2. If a few people lose their money from speculation so what? The constant flow of money from the government will ensure that loss with have minimal feed on effects. Mostly, the banks won’t suddenly stop creating money and throwing us all into recession as happened in the GFC
Borrowing, either directly or by simply printing cash and borrowing that off future taxpayers
Creating money which is then spent directly into the economy producing economic activity now is not borrowing.
Nah. That’s what the education system is for
People need to be able to afford to go and get that education and that’s what the UBI will do.
but printing money simply substitutes interest payments for boosts to inflation.
But creating money doesn’t automatically translate into inflation – as the vast printing of money around the world after the GFC proved.
Nope because the taxes would go up at the same time that spending goes up. If spending doesn’t go up then taxes don’t go up.
So how does that differ with what blinglish currently does every year?
And we’re not starting at a zero point. We already have a monetary flow. There’d be a transition period when inflation may be a little higher than normal but I doubt if it would last long.
Ok, so there will be inflation, now we’re just quibbling over how large and sustained it will be.
It bypasses the fractional reserve system (which is merely a multiplier of the OCR tool, not an integral part), but that doesn’t mean that the banks will contribute any less to boom and bust speculative cycles.
Yeah, actually, it does:
1. The banks will no longer be able to leverage minimal funds into massive loans. They’re strictly limited to what they have on deposit for on-lending and the people who so deposited it won’t be able to spend it either thus removing that piece of leveraging as well
2. If a few people lose their money from speculation so what? The constant flow of money from the government will ensure that loss with have minimal feed on effects. Mostly, the banks won’t suddenly stop creating money and throwing us all into recession as happened in the GFC
It wasn’t the creation of money that created the GFC, it was the outright frauds that were committed with that money, that then made the banks terrified of lending money to each other in order to settle daily debts and tallies. They created a pyramid of bad loan packages, then as soon as the music stopped playing all the bankers dropped those hot potatoes so they wouldn’t get caught with their pants down (abuse of allegorical language intentional 🙂 ).
Creating money which is then spent directly into the economy producing economic activity now is not borrowing.
It is if taxpayers have to make it up, even in the near-immediate future.
but printing money simply substitutes interest payments for boosts to inflation.
But creating money doesn’t automatically translate into inflation – as the vast printing of money around the world after the GFC proved.
Well, yes it does. That’s why they did it: boost GDP with the corresponding effect on inflation. Because they were at extreme risk of deflation and depression.
Maybe if we take a step back because interest rates set the rate at which you can borrow from the reserve bank but they are apart of the cost when settling transactions between different banks, and banks hang on to reserve in case the housing sector has a massive run on for cash, and they never pass on full rate cuts. But if you take interest away banks themselves still have guides to take on crises, and that’s just in case there’s a fiscal demand for cash.
So how does that differ with what blinglish currently does every year?
The current system actually borrows the money at interest. The government borrows from private banks which create the money at the time. The addition of interest means that it can never be fully paid back which means we have an expanding monetary base.
Never mind the fact that the private banks also create money when they make a loan to private individuals as well.
Sovereign Money gets rid of that. It has the continuous creation and destruction of money needed to keep the economy moving but it doesn’t have the interest component that forces growth. A stable state economy would work.
They created a pyramid of bad loan packages, then as soon as the music stopped playing all the bankers dropped those hot potatoes so they wouldn’t get caught with their pants down (abuse of allegorical language intentional 🙂 ).
The entire banking sector is a Ponzi Scheme – see above – which is why it fell over.
Well, yes it does. That’s why they did it: boost GDP with the corresponding effect on inflation. Because they were at extreme risk of deflation and depression.
No it doesn’t.
Yes, that is one of the reasons why they printed so much money but the inflation didn’t actually eventuate. The other reason, and probably the main one, that they printed so much was to prop up the banks. If the Ponzi Scheme that the private banks run collapsed the way it should have then, yes, we would have been in a depression.
Of course, the best thing that they could have done to prevent a depression is implement a UBI and let the banks collapse. Instead they gave it all to the banks which then kept it instead of loaning it out for productive activity.
A UBI would have prevented a recession, kept local businesses going and allowed the market to correct for the banks fraudulent activities.
The addition of interest means that it can never be fully paid back which means we have an expanding monetary base.
Bullshit. Of course it can be paid off, with interest.
And the “sovereign debt” equivalent of interest is the systemic costs of the inflation it creates, even temporarily.
Yes, that is one of the reasons why they printed so much money but the inflation didn’t actually eventuate.
or it did eventuate and without it the world would have gone into a deflationary spiral.
The other reason, and probably the main one, that they printed so much was to prop up the banks. If the Ponzi Scheme that the private banks run collapsed the way it should have then, yes, we would have been in a depression.
agreed.
Of course, the best thing that they could have done to prevent a depression is implement a UBI and let the banks collapse. Instead they gave it all to the banks which then kept it instead of loaning it out for productive activity.
Nah. The best thing they could have done was buy all the bad loans at crap market rates and renegotiate sustainable repayment terms for the borrowers, thereby starting one of the biggest state housing programmes in decades if not history.
Profit gouging (especially by multinationals, e.g. bank interest) is also destruction of money, if there’s a weak tax regime (or tax haven) and no reciprocal investment back into NZ
Similarly, GST & income tax is a highly regressive drag on the economy and devalues the work of the many, whereas the top few % rich in assets pay relatively no tax. In fact, because of the property bubble there are thousands of lucky/privileged/entitled Aucklanders whose net tax is probably less than zero.
On Planet Key, the wealthy pay no tax, and the poor get taxed on all income over $1
As I said in the rest of that sentence. Unfortunately, Aussie banks are destroying value by extracting billions from the NZ economy per year without commensurate spend back in to NZ
Yep, the dead-weight loss of profit. I’m quite aware of it but it not destroying the money. It can still be spent and it’s usually spent on assets thus driving asset price bubbles.
Same with privatisation, offset the blame, a whole bunch of people with their hands in the air singing ‘It wasn’t me’ til you get to the poor shmo on minimum wage at the bottom of the ladder ‘It’s all his fault!’.
More of this national government and there worshipers failing to take any responsibility for anything the have wreaked over the last 8 years of office.
Nothing to do with chronic lack of resourcing in Police and cutting mental health services so that Bill English can put some nice numbers in a fucking spreadsheet…
This is awful broadcasting. And this is what the Horrid want to do with the NZOA funding changes. They want to contest for public funding to produce this kind of crap.
Ha ha. I was lucky enough just now to watch the super big Moon-rise at about 68degrees from North in Blenheim. A lovely golden colour and just huge. Don’t think I will be around to see the next one.
I do hope you have at least another 18 years in you. The full moon will be even closer on 26 November 2034. And there’s a total solar eclipse directly over the South Island in 2028 to tide you over.
I've seen these days before and I can tell you it doesn't end well for the common folk. https://t.co/oFe1la0V6n— Harry Leslie Smith (@Harryslaststand) November 13, 2016
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These puppet strings don't pull themselvesYou're thinking thoughts from someone elseHow much time do you think you have?Are you prepared for what comes next?The debating chamber can be a trying place for an opposition MP. What with the person in charge, the speaker, typically being an MP from the governing ...
The land around Lyme Regis, where Meryl Streep once stood, in a hood, on the Cobb, is falling into the sea.MerylThe land around Lyme Regis, around the Cobb that made it rich, has always been falling slowly but surely into the sea. Read more ...
Buzz from the Beehive Foreign Affairs Minister Winston Peters was bound to win headlines when he set out his thinking about AUKUS in his speech to the New Zealand Institute of International Affairs. The headlines became bigger when – during an interview on RNZ’s Morning Report today – he criticised ...
The Post reports on how the government is refusing to release its advice on its corrupt Muldoonist fast-track law, instead using the "soon to be publicly available" refusal ground to hide it until after select committee submissions on the bill have closed. Fast-track Minister Chris Bishop's excuse? “It's not ...
As pressure on it grows, the livestock industry’s approach to the transition to Net Zero is increasingly being compared to that of fossil fuel interests. Photo: Lynn Grieveson / Getty ImagesTL;DR: Here’s the top five news items of note in climate news for Aotearoa-NZ this week, and a discussion above ...
The New Zealand Herald reports – Stats NZ has offered a voluntary redundancy scheme to all of its workers as a way to give staff some control over their “future” amidst widespread job losses in the public sector. In an update to staff this morning, seen by the Herald, Statistics New Zealand ...
On Werewolf/Scoop, I usually do two long form political columns a week. From now on, there will be an extra column each week about music and movies. But first, some late-breaking political events:The rise in unemployment numbers for the March quarter was bigger than expected – and especially sharp ...
David Farrar writes – The Herald reports: TVNZ says it is dealing with about 50 formal complaints over its coverage of the latest 1News-Verian political poll, with some viewers – as well as the Prime Minister and a former senior Labour MP – critical of the tone of the 6pm report. ...
Muriel Newman writes – When Meridian Energy was seeking resource consents for a West Coast hydro dam proposal in 2010, local Maori “strenuously” objected, claiming their mana was inextricably linked to ‘their’ river and could be damaged. After receiving a financial payment from the company, however, the Ngai Tahu ...
Alwyn Poole writes – “An SEP,’ he said, ‘is something that we can’t see, or don’t see, or our brain doesn’t let us see, because we think that it’s somebody else’s problem. That’s what SEP means. Somebody Else’s Problem. The brain just edits it out, it’s like a ...
Our trust in our political institutions is fast eroding, according to a Maxim Institute discussion paper, Shaky Foundations: Why our democracy needs trust. The paper – released today – raises concerns about declining trust in New Zealand’s political institutions and democratic processes, and the role that the overuse of Parliamentary urgency ...
This article was prepared for publication yesterday. More ministerial announcements have been posted on the government’s official website since it was written. We will report on these later today …. Buzz from the BeehiveThere we were, thinking the environment is in trouble, when along came Jones. Shane Jones. ...
New Zealand now has the fourth most depressed construction sector in the world behind China, Qatar and Hong Kong. Photo: Lynn Grieveson / The KākāTL;DR: These are the six things that stood out to me in news and commentary on Aotearoa-NZ’s political economy at 8:46am on Thursday, May 2:The Lead: ...
Hi,I am just going to state something very obvious: American police are fucking crazy.That was a photo gracing the New York Times this morning, showing New York City police “entering Columbia University last night after receiving a request from the school.”Apparently in America, protesting the deaths of tens of thousands ...
Winston Peters’ much anticipated foreign policy speech last night was a work of two halves. Much of it was a standard “boilerplate” Foreign Ministry overview of the state of the world. There was some hardening up of rhetoric with talk of “benign” becoming “malign” and old truths giving way to ...
Graham Adams assesses the fallout of the Cass Review — The press release last Thursday from the UN Special Rapporteur on violence against women and girls didn’t make the mainstream news in New Zealand but it really should have. The startling title of Reem Alsalem’s statement — “Implementation of ‘Cass ...
This open-for-business, under-new-management cliché-pockmarked government of Christopher Luxon is not the thing of beauty he imagines it to be. It is not the powerful expression of the will of the people that he asserts it to be. It is not a soaring eagle, it is a malodorous vulture. This newest poll should make ...
The latest labour market statistics, showing a rise in unemployment. There are now 134,000 unemployed - 14,000 more than when the National government took office. Which is I guess what happens when the Reserve Bank causes a recession in an effort to Keep Wages Low. The previous government saw a ...
Three opinion polls have been released in the last two days, all showing that the new government is failing to hold their popular support. The usual honeymoon experienced during the first year of a first term government is entirely absent. The political mood is still gloomy and discontented, mainly due ...
National's Finance Minister once met a poor person.A scornful interview with National's finance guru who knows next to nothing about economics or people.There might have been something a bit familiar if that was the headline I’d gone with today. It would of course have been in tribute to the article ...
Rob MacCulloch writes – Throughout the pandemic, the new Vice-Chancellor-of-Otago-University-on-$629,000 per annum-Can-you-believe-it-and-Former-Finance-Minister Grant Robertson repeated the mantra over and over that he saved “lives and livelihoods”.As we update how this claim is faring over the course of time, the facts are increasingly speaking differently. NZ ...
Chris Trotter writes – IT’S A COMMONPLACE of political speeches, especially those delivered in acknowledgement of electoral victory: “We’ll govern for all New Zealanders.” On the face of it, the pledge is a strange one. Why would any political leader govern in ways that advantaged the huge ...
Bryce Edwards writes – The list of former National Party Ministers being given plum and important roles got longer this week with the appointment of former Deputy Prime Minister Paula Bennett as the chair of Pharmac. The Christopher Luxon-led Government has now made key appointments to Bill ...
TL;DR: These are the six things that stood out to me in news and commentary on Aotearoa-NZ’s political economy at 10:06am on Wednesday, May 1:The Lead: Business confidence fell across the board in April, falling in some areas to levels last seen during the lockdowns because of a collapse in ...
Over the past 36 hours, Christopher Luxon has been dong his best to portray the centre-right’s plummeting poll numbers as a mark of virtue. Allegedly, the negative verdicts are the result of hard economic times, and of a government bravely set out on a perilous rescue mission from which not ...
Auckland Transport have started rolling out new HOP card readers around the network and over the next three months, all of them on buses, at train stations and ferry wharves will be replaced. The change itself is not that remarkable, with the new readers looking similar to what is already ...
Completed reads for April: The Difference Engine, by William Gibson and Bruce Sterling Carnival of Saints, by George Herman The Snow Spider, by Jenny Nimmo Emlyn’s Moon, by Jenny Nimmo The Chestnut Soldier, by Jenny Nimmo Death Comes As the End, by Agatha Christie Lord of the Flies, by ...
On February 14, 2023 we announced our Rebuttal Update Project. This included an ask for feedback about the added "At a glance" section in the updated basic rebuttal versions. This weekly blog post series highlights this new section of one of the updated basic rebuttal versions and serves as a ...
Have a story to share about St Paul’s, but today just picturesPopular novels written at this desk by a young man who managed to bootstrap himself out of father’s imprisonment and his own young life in a workhouse Read more ...
The list of former National Party Ministers being given plum and important roles got longer this week with the appointment of former Deputy Prime Minister Paula Bennett as the chair of Pharmac. The Christopher Luxon-led Government has now made key appointments to Bill English, Simon Bridges, Steven Joyce, Roger Sowry, ...
Newsroom has a story today about National's (fortunately failed) effort to disestablish the newly-created Inspector-General of Defence. The creation of this agency was the key recommendation of the Inquiry into Operation Burnham, and a vital means of restoring credibility and social licence to an agency which had been caught lying ...
Holding On To The Present:The moment a political movement arises that attacks the whole idea of social progress, and announces its intention to wind back the hands of History’s clock, then democracy, along with its unwritten rules, is in mortal danger.IT’S A COMMONPLACE of political speeches, especially those delivered in ...
Stuck In The Middle With You:As Christopher Luxon feels the hot breath of Act’s and NZ First’s extremists on the back of his neck and, as he reckons with the damage their policies are already inflicting upon a country he’s described as “fragile”, is there not some merit in reaching out ...
The unpopular coalition government is currently rushing to repeal section 7AA of the Oranga Tamariki Act. The clause is Oranga Tamariki's Treaty clause, and was inserted after its systematic stealing of Māori children became a public scandal and resulted in physical resistance to further abductions. The clause created clear obligations ...
Buzz from the Beehive The government’s official website – which Point of Order monitors daily – not for the first time has nothing much to say today about political happenings that are grabbing media headlines. It makes no mention of the latest 1News-Verian poll, for example. This shows National down ...
It Takes A Train To Cry:Surely, there is nothing lonelier in all this world than the long wail of a distant steam locomotive on a cold Winter’s night.AS A CHILD, I would lie awake in my grandfather’s house and listen to the traffic. The big wooden house was only a ...
Packing A Punch: The election of the present government, including in its ranks politicians dedicated to reasserting the rights of the legislature in shaping and determining the future of Māori and Pakeha in New Zealand, should have alerted the judiciary – including its anomalous appendage, the Waitangi Tribunal – that its ...
Dead Woman Walking: New Zealand’s media industry had been moving steadily towards disaster for all the years Melissa Lee had been National’s media and communications policy spokesperson, and yet, when the crisis finally broke, on her watch, she had nothing intelligent to offer. Christopher Luxon is a patient man - but he’s not ...
Chris Trotter writes – New Zealand politics is remarkably easy-going: dangerously so, one might even say. With the notable exception of John Key’s flat ruling-out of the NZ First Party in 2008, all parties capable of clearing MMP’s five-percent threshold, or winning one or more electorate seats, tend ...
Ministers must front up about which projects it will push through under its Fast Track Approvals legislation, Labour environment spokesperson Rachel Brooking said today. ...
The Government is again adding to New Zealand’s growing unemployment, this time cutting jobs at the agencies responsible for urban development and growing much needed housing stock. ...
With Minister Karen Chhour indicating in the House today that she either doesn’t know or care about the frontline cuts she’s making to Oranga Tamariki, we risk seeing more and more of our children falling through the cracks. ...
The Labour Party is saddened to learn of the death of Sir Robert Martin, a globally renowned disability advocate who led the way for disability rights both in New Zealand and internationally. ...
Labour is calling for the Government to urgently rethink its coalition commitment to restart live animal exports, Labour animal welfare spokesperson Rachel Boyack said. ...
Today’s Financial Stability Report has once again highlighted that poverty and deep inequality are political choices - and this Government is choosing to make them worse. ...
The Green Party is calling on the Government to do more for our households in most need as unemployment rises and the cost of living crisis endures. ...
Unemployment is on the rise and it’s only going to get worse under this Government, Labour finance spokesperson Barbara Edmonds said. Stats NZ figures show the unemployment rate grew to 4.3 percent in the March quarter from 4 percent in the December quarter. “This is the second rise in unemployment ...
The New Zealand Labour Party welcomes the entering into force of the European Union and New Zealand free trade agreement. This agreement opens the door for a huge increase in trade opportunities with a market of 450 million people who are high value discerning consumers of New Zealand goods and ...
The National-led Government continues its fiscal jiggery pokery with its Pharmac announcement today, Labour Health spokesperson Ayesha Verrall says. “The government has increased Pharmac funding but conceded it will only make minimal increases in access to medicine”, said Ayesha Verrall “This is far from the bold promises made to fund ...
This afternoon’s interim Waitangi Tribunal report must be taken seriously as it affects our most vulnerable children, Labour children’s spokesperson Willow-Jean Prime. ...
Te Pāti Māori are demanding the New Zealand Government support an international independent investigation into mass graves that have been uncovered at two hospitals on the Gaza strip, following weeks of assault by Israeli troops. Among the 392 bodies that have been recovered, are children and elderly civilians. Many of ...
Our two-tiered system for veterans’ support is out of step with our closest partners, and all parties in Parliament should work together to fix it, Labour veterans’ affairs spokesperson Greg O’Connor said. ...
Stripping two Ministers of their portfolios just six months into the job shows Christopher Luxon’s management style is lacking, Labour Leader Chris Hipkins said. ...
Tonight’s court decision to overturn the summons of the Children’s Minister has enabled the Crown to continue making decisions about Māori without evidence, says Te Pāti Māori spokesperson for Children, Mariameno Kapa-Kingi. “The judicial system has this evening told the nation that this government can do whatever they want when ...
It appears Nicola Willis is about to pull the rug out from under the feet of local communities still dealing with the aftermath of last year’s severe weather, and local councils relying on funding to build back from these disasters. ...
The Government is making short-sighted changes to the Resource Management Act (RMA) that will take away environmental protection in favour of short-term profits, Labour’s environment spokesperson Rachel Brooking said today. ...
Labour welcomes the release of the report into the North Island weather events and looks forward to working with the Government to ensure that New Zealand is as prepared as it can be for the next natural disaster. ...
The Labour Party has called for the New Zealand Government to recognise Palestine, as a material step towards progressing the two-State solution needed to achieve a lasting peace in the region. ...
Some of our country’s most important work, stopping the sexual exploitation of children and violent extremism could go along with staff on the frontline at ports and airports. ...
The Government’s Fast Track Approvals Bill will give projects such as new coal mines a ‘get out of jail free’ card to wreak havoc on the environment, Labour Leader Chris Hipkins said today. ...
The government's decision to reintroduce Three Strikes is a destructive and ineffective piece of law-making that will only exacerbate an inherently biased and racist criminal justice system, said Te Pāti Māori Justice Spokesperson, Tākuta Ferris, today. During the time Three Strikes was in place in Aotearoa, Māori and Pasifika received ...
Cuts to frontline hospital staff are not only a broken election promise, it shows the reckless tax cuts have well and truly hit the frontline of the health system, says Labour Health spokesperson Ayesha Verrall. ...
The Green Party has joined the call for public submissions on the fast-track legislation to be extended after the Ombudsman forced the Government to release the list of organisations invited to apply just hours before submissions close. ...
New Zealand’s good work at reducing climate emissions for three years in a row will be undone by the National government’s lack of ambition and scrapping programmes that were making a difference, Labour Party climate spokesperson Megan Woods said today. ...
More essential jobs could be on the chopping block, this time Ministry of Education staff on the school lunches team are set to find out whether they're in line to lose their jobs. ...
Te Pāti Māori is disgusted at the confirmation that hundreds are set to lose their jobs at Oranga Tamariki, and the disestablishment of the Treaty Response Unit. “This act of absolute carelessness and out of touch decision making is committing tamariki to state abuse.” Said Te Pāti Māori Oranga Tamariki ...
New Zealand Sign Language Week is an excellent opportunity for all Kiwis to give the language a go, Disabilities Issues Minister Louise Upston says. This week (May 6 to 12) is New Zealand Sign Language (NZSL) Week. The theme is “an Aotearoa where anyone can sign anywhere” and aims to ...
Six tertiary students have been selected to work on NASA projects in the US through a New Zealand Space Scholarship, Space Minister Judith Collins announced today. “This is a fantastic opportunity for these talented students. They will undertake internships at NASA’s Ames Research Center or its Jet Propulsion Laboratory (JPL), where ...
New Zealanders will be safer because of a $1.9 billion investment in more frontline Corrections officers, more support for offenders to turn away from crime, and more prison capacity, Corrections Minister Mark Mitchell says. “Our Government said we would crack down on crime. We promised to restore law and order, ...
The OECD’s latest report on New Zealand reinforces the importance of bringing Government spending under control, Finance Minister Nicola Willis says. The OECD conducts country surveys every two years to review its members’ economic policies. The 2024 New Zealand survey was presented in Wellington today by OECD Chief Economist Clare Lombardelli. ...
The Government has delivered on its election promise to provide a financially sustainable model for Auckland under its Local Water Done Well plan. The plan, which has been unanimously endorsed by Auckland Council’s Governing Body, will see Aucklanders avoid the previously projected 25.8 per cent water rates increases while retaining ...
Foreign Minister Winston Peters discussed the need for an immediate ceasefire in Gaza, and enhanced cooperation in the Pacific with German Foreign Minister Annalena Baerbock during her first official visit to New Zealand today. "New Zealand and Germany enjoy shared interests and values, including the rule of law, democracy, respect for the international system ...
The Minister Responsible for RMA Reform, Chris Bishop today released his decision on four recommendations referred to him by the Western Bay of Plenty District Council, opening the door to housing growth in the area. The Council’s Plan Change 92 allows more homes to be built in existing and new ...
Thank you, John McKinnon and the New Zealand China Council for the invitation to speak to you today. Thank you too, all members of the China Council. Your effort has played an essential role in helping to build, shape, and grow a balanced and resilient relationship between our two ...
The Government is modernising insurance law to better protect Kiwis and provide security in the event of a disaster, Commerce and Consumer Affairs Minister Andrew Bayly announced today. “These reforms are long overdue. New Zealand’s insurance law is complicated and dated, some of which is more than 100 years old. ...
The coalition Government is refreshing its approach to supporting pay equity claims as time-limited funding for the Pay Equity Taskforce comes to an end, Public Service Minister Nicola Willis says. “Three years ago, the then-government introduced changes to the Equal Pay Act to support pay equity bargaining. The changes were ...
Structured literacy will change the way New Zealand children learn to read - improving achievement and setting students up for success, Education Minister Erica Stanford says. “Being able to read and write is a fundamental life skill that too many young people are missing out on. Recent data shows that ...
Trade Minister Todd McClay says Canada’s refusal to comply in full with a CPTPP trade dispute ruling in our favour over dairy trade is cynical and New Zealand has no intention of backing down. Mr McClay said he has asked for urgent legal advice in respect of our ‘next move’ ...
The rights of our children and young people will be enhanced by changes the coalition Government will make to strengthen oversight of the Oranga Tamariki system, including restoring a single Children’s Commissioner. “The Government is committed to delivering better public services that care for our most at-risk young people and ...
The Government is making it easier for minor changes to be made to a building consent so building a home is easier and more affordable, Building and Construction Minister Chris Penk says. “The coalition Government is focused on making it easier and cheaper to build homes so we can ...
New Zealand lost a true legend when internationally renowned disability advocate Sir Robert Martin (KNZM) passed away at his home in Whanganui last night, Disabilities Issues Minister Louise Upston says. “Our Government’s thoughts are with his wife Lynda, family and community, those he has worked with, the disability community in ...
Good evening – Before discussing the challenges and opportunities facing New Zealand’s foreign policy, we’d like to first acknowledge the New Zealand Institute of International Affairs. You have contributed to debates about New Zealand foreign policy over a long period of time, and we thank you for hosting us. ...
From today, passengers travelling internationally from Auckland Airport will be able to keep laptops and liquids in their carry-on bags for security screening thanks to new technology, Transport Minister Simeon Brown says. “Creating a more efficient and seamless travel experience is important for holidaymakers and businesses, enabling faster movement through ...
People with an interest in the health of Northland’s marine ecosystems are invited to a public meeting to discuss how to deal with kina barrens, Oceans and Fisheries Minister Shane Jones says. Mr Jones will lead the discussion, which will take place on Friday, 10 May, at Awanui Hotel in ...
Kiwi exporters are $100 million better off today with the NZ EU FTA entering into force says Trade Minister Todd McClay. “This is all part of our plan to grow the economy. New Zealand's prosperity depends on international trade, making up 60 per cent of the country’s total economic activity. ...
There are heartening signs that the extractive sector is once again becoming an attractive prospect for investors and a source of economic prosperity for New Zealand, Resources Minister Shane Jones says. “The beginnings of a resurgence in extractive industries are apparent in media reports of the sector in the past ...
The return of the historic Ō-Rākau battle site to the descendants of those who fought there moved one step closer today with the first reading of Te Pire mō Ō-Rākau, Te Pae o Maumahara / The Ō-Rākau Remembrance Bill. The Bill will entrust the 9.7-hectare battle site, five kilometres west ...
Energy Minister Simeon Brown has announced 25 new high-speed EV charging hubs along key routes between major urban centres and outlined the Government’s plan to supercharge New Zealand’s EV infrastructure. The hubs will each have several chargers and be capable of charging at least four – and up to 10 ...
The coalition Government will not proceed with the previous Government’s plans to regulate residential property managers, Housing Minister Chris Bishop says. “I have written to the Chairperson of the Social Services and Community Committee to inform him that the Government does not intend to support the Residential Property Managers Bill ...
The Government has announced an independent review into the disability support system funded by the Ministry of Disabled People – Whaikaha. Disability Issues Minister Louise Upston says the review will look at what can be done to strengthen the long-term sustainability of Disability Support Services to provide disabled people and ...
Justice Minister Paul Goldsmith has attended the Universal Periodic Review in Geneva and outlined the Government’s plan to restore law and order. “Speaking to the United Nations Human Rights Council provided us with an opportunity to present New Zealand’s human rights progress, priorities, and challenges, while responding to issues and ...
The Government and Rotorua Lakes Council are committed to working closely together to end the use of contracted emergency housing motels in Rotorua. Associate Minister of Housing (Social Housing) Tama Potaka says the Government remains committed to ending the long-term use of contracted emergency housing motels in Rotorua by the ...
Trade Minister Todd McClay heads overseas today for high-level trade talks in the Gulf region, and a key OECD meeting in Paris. Mr McClay will travel to Riyadh to meet with counterparts from Saudi Arabia and the Gulf Cooperation Council (GCC). “New Zealand’s goods and services exports to the Gulf region ...
Education Minister Erica Stanford has outlined six education priorities to deliver a world-leading education system that sets Kiwi kids up for future success. “I’m putting ambition, achievement and outcomes at the heart of our education system. I want every child to be inspired and engaged in their learning so they ...
The new NZ Transport Agency (NZTA) App is a secure ‘one stop shop’ to provide the services drivers need, Transport Minister Simeon Brown and Digitising Government Minister Judith Collins say. “The NZTA App will enable an easier way for Kiwis to pay for Vehicle Registration and Road User Charges (RUC). ...
Whānau with tamariki growing up in emergency housing motels will be prioritised for social housing starting this week, says Associate Housing Minister Tama Potaka. “Giving these whānau a better opportunity to build healthy stable lives for themselves and future generations is an essential part of the Government’s goal of reducing ...
Racing Minister Winston Peters has paid tribute to an icon of the industry with the recent passing of Dave O’Sullivan (OBE). “Our sympathies are with the O’Sullivan family with the sad news of Dave O’Sullivan’s recent passing,” Mr Peters says. “His contribution to racing, initially as a jockey and then ...
Assalaamu alaikum, greetings to you all. Eid Mubarak, everyone! I want to extend my warmest wishes to you and everyone celebrating this joyous occasion. It is a pleasure to be here. I have enjoyed Eid celebrations at Parliament before, but this is my first time joining you as the Minister ...
Associate Health Minister David Seymour has announced Pharmac’s largest ever budget of $6.294 billion over four years, fixing a $1.774 billion fiscal cliff. “Access to medicines is a crucial part of many Kiwis’ lives. We’ve committed to a budget allocation of $1.774 billion over four years so Kiwis are ...
Hon Paula Bennett has been appointed as member and chair of the Pharmac board, Associate Health Minister David Seymour announced today. "Pharmac is a critical part of New Zealand's health system and plays a significant role in ensuring that Kiwis have the best possible access to medicines,” says Mr Seymour. ...
Hundreds of New Zealand families affected by Fetal Alcohol Spectrum Disorder (FASD) will benefit from a new Government focus on prevention and treatment, says Health Minister Dr Shane Reti. “We know FASD is a leading cause of preventable intellectual and neurodevelopmental disability in New Zealand,” Dr Reti says. “Every day, ...
Regional Development Minister Shane Jones today attended the official opening of Kaikohe’s new $14.7 million sports complex. “The completion of the Kaikohe Multi Sports Complex is a fantastic achievement for the Far North,” Mr Jones says. “This facility not only fulfils a long-held dream for local athletes, but also creates ...
Foreign Minister Winston Peters’ engagements in Türkiye this week underlined the importance of diplomacy to meet growing global challenges. “Returning to the Gallipoli Peninsula to represent New Zealand at Anzac commemorations was a sombre reminder of the critical importance of diplomacy for de-escalating conflicts and easing tensions,” Mr Peters ...
Ambassador Millar, Burgemeester, Vandepitte, Excellencies, military representatives, distinguished guests, ladies and gentlemen – good morning and welcome to this sacred Anzac Day dawn service. It is an honour to be here on behalf of the Government and people of New Zealand at Buttes New British Cemetery, Polygon Wood – a deeply ...
Distinguished guests - It is an honour to return once again to this site which, as the resting place for so many of our war-dead, has become a sacred place for generations of New Zealanders. Our presence here and at the other special spaces of Gallipoli is made ...
Mai ia tawhiti pamamao, te moana nui a Kiwa, kua tae whakaiti mai matou, ki to koutou papa whenua. No koutou te tapuwae, no matou te tapuwae, kua honoa pumautia. Ko nga toa kua hinga nei, o te Waipounamu, o te Ika a Maui, he okioki tahi me o ...
The beloved local grocers lost a legal challenge to stop a new cycleway outside their store. Joel MacManus reports. In the annals of New Zealand legal history, there are a few brave people who have dared to stand up to the powers that be, no matter how bleak the odds ...
How what we produce and what we eat connects us to the world beyond our shores, visualised. Walking around a supermarket or vege shop, it might be obvious that everything on the shelves came from somewhere. But you might ...
Professor Jemma Geoghegan, of the University of Otago, Otakou Whakaihu Waka, co-leads a Te Niwha project aimed at understanding how and where avian influenza could affect Aotearoa New Zealand, as the highly infectious H5N1 virus spreads globally. The virus has now spread to all continents except Oceania and was recently ...
Thirty years on from Rwanda’s genocide, is guilt over the atrocities is blinding the world to the true nature of its current leadership? The post The repressive underside of Rwanda’s regime appeared first on Newsroom. ...
Opinion: Last week, important recommendations for our criminal justice system were made by the international community. Every five years, each member of the United Nations has its human rights practices reviewed. This rolling event – the Universal Periodic Review – is the culmination of a government reporting on its human ...
Highly pathogenic avian influenza – H5N1, or bird flu – has been flying around the world since the late 1990s. New Zealand, Australia and the Pacific Islands are so far free of it, but now it’s been discovered in mainland Antarctica and scientists say it’s only a matter of time ...
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The following interview with auto electrician and former caver Stu Berendt, 68, of Charleston on the West Coast, came about because he was part of the caving team that found the rare and amazing fossil remains of the giant Haast eagle, the subject of one of the year’s best books, ...
A $1.8b funding boost for Pharmac still won’t enable it to buy more drugs, raising questions about the Government’s approach to the agency The post Can Pharmac do more with the same pot of money? appeared first on Newsroom. ...
Source: The Conversation (Au and NZ) – By Eric Stokan, Assistant Professor of Political Science, University of Maryland, Baltimore County If you live in one of the most economically deprived neighborhoods in your city, you might think the government is directing a smaller share of public funds to your community. ...
Wansolwara The news media’s crucial role in climate change and environment journalism was the focus of The University of the South Pacific’s Journalism Programme 2024 World Press Freedom Day celebrations. The European Union Ambassador to the Pacific, Barbara Plinkert, and Pacific Islands Forum Secretary General Henry Puna were the chief ...
Source: The Conversation (Au and NZ) – By Michael Adams, Professor of Corporate Law & Academic Director of UNE Sydney campus, University of New England Last August, the Australian Competition and Consumer Commission (ACCC) launched legal proceedings against Qantas. The consumer watchdog accused the airline of selling thousands of tickets ...
This episode of A View From Afar was recorded LIVE on May 6, 2024 (NZST) which is Sunday evening, May 5, 2024 at 8:30pm (USEST). In an analytical essay titled ‘A moment of friction’ political scientist Dr Paul Buchanan wrote how we are living within a decisive moment ...
Source: The Conversation (Au and NZ) – By Alison Taylor, Assistant Professor, Bond University Metro Goldwyn Mayer Pictures At the crux of the critical response to Luca Guadagnino’s new movie Challengers is one word: “sexy”. The film charts a love triangle between three up-and-coming tennis players: Tashi (Zendaya), ...
Source: The Conversation (Au and NZ) – By Jenny Stewart, Professor of Public Policy, ADFA Canberra, UNSW Sydney For years, First Nations people have been telling governments they want to be listened to. In particular, they want more ownership of the programs and services that are supposed to help them. ...
Source: The Conversation (Au and NZ) – By Gregory Moore, Senior Research Associate, School of Ecosystem and Forest Sciences, The University of Melbourne Why do trees have bark? Julien, age 6, Melbourne. This is a great question, Julien. We are so familiar with bark on trees, that most of us ...
Source: The Conversation (Au and NZ) – By Anthony Nasser, Senior Lecturer in Physiotherapy, University of Technology Sydney PeopleImages.com – Yuri A/Shutterstock The anterior cruciate ligament (ACL) is an important ligament in the knee. It runs from the thigh bone (femur) to the shin bone (tibia) and helps stabilise ...
Source: The Conversation (Au and NZ) – By Adrian Beaumont, Election Analyst (Psephologist) at The Conversation; and Honorary Associate, School of Mathematics and Statistics, The University of Melbourne I covered the May 2 United Kingdom local government elections for The Poll Bludger. The Blackpool South parliamentary byelection was also held, ...
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@McFlock
Put this here because it was OT in thread.
It’s not just creation money though – you have to include it’s destruction. The cycle should go:
Government >> economy >> government
The money’s return to government is actually it’s destruction. Under those conditions then inflation can be minimal.
As for the exchange value – that needs to be set by a formula (essentially imports/exports) rather than the wishful thinking of the speculators.
How is money going back to the government destruction?
Because when it’s returned to the government it’s matched against previous spending.
Spend into the economy (+1)
Return to government (-1)
total = 0
The government should actually run at a slight deficit to match population growth and the easy way to do that is a UBI.
spend into the economy(+1)
return to government (-1)
tax rate 100%
spend available for provision 0
output 0
savings 0
confidence 0
exchange rate …..won’t matter as it won’t be wanted (or needed)
Completely wrong.
Spend available for provision of government services is the amount needed to provide those services – no more, no less.
This spending then gets spent into the private sector causing multiplier effect (usually around 3 times).
Overall tax @ 33% to have return to government balance.
It would be government spending, including the UBI, that provides the entire money supply for the economy to work. This:
1. Removes poverty
2. Eliminates the business cycle
3. and removes the need for infinite exponential growth on a finite world.
lol….so zero imports and zero savings …thats a realistic model…not
Why would there be zero imports/exports?
And we don’t need savings. In fact, savings seem to be a large part of the problem with our present financial system.
That said, there’s nothing stopping people from putting money in the bank. They just won’t get any interest on it.
why?…because you claim a tax rate of 33% and a multiplier of 3 …that requires a zero savings and import rate
and we don’t need savings? would love to hear your explanation of how anyone is going to purchase anything that costs more than say a weeks “wages”( while eating and being housed)…and that also suggests all ownership will have be by the state for there will be no ability for private investment…and placing it in a bank (even at zero interest) still removes it from circulation and negatively impacts ME
but the best of all is how you propose to administer the inevitable demand for more. and the inflationary spiral that creates.?..even in a totally closed economy which while possible is extremely unlikely
You said that when you claimed it was 100% tax rate. Now that you’re informed that it’s actually 33% you’re saying the same thing.
Your maths is wrong.
$1 is spent into the economy
This produces $1 of economic value
$0.33 is taxed back out from that $1
Leaving $0.67 in the economy which goes round again to be taxed again
Meanwhile, the government has spent more into the economy
You need to think of the economy as a constant flow.
Money in >> stuff happens >> Money out >> Money in
It’s not Money in >> Money out and that’s it, nobodies got any money and nothing happened as you seem to think.
No we don’t. Savings aren’t needed to buy cars. It’s supposedly needed to make investments but it’s not needed for that either.
And, of course, people would still be able to put money aside to buy larger stuff.
And how did I propose to do that?
There’s no inflationary spiral as the money is balanced. Unlike now where the money into the system isn’t balanced resulting in high house price inflation.
“You said that when you claimed it was 100% tax rate. Now that you’re informed that it’s actually 33% you’re saying the same thing.
Your maths is wrong.”
lol. nothing wrong with my basic arithmetic but does appear to be something wrong with your understanding of the multiplier effect which you cited..
.ME ratio= 1/ propensity to save, propensity to tax and propensity to import
so your example 3 = 1/ 0 + 0 .33 + 0 …. change any factor (imports or savings i.e.) and your multiplier will change.
will return to your other misconceptions when I have some time
Possible. The multiplier effect won’t be the same in a Sovereign Money financial system as in the current system.
I’m thinking that it would be more of a measure of how many transactions money will go through before it’s fully returned/destroyed. I was making an assumption, based upon the present multiplier usually being ~3, that it would be about the same.
Thinking about it some more that assumption is most likely low which means that the overall tax rate would be lower. Would probably need a FTT.
“No we don’t. Savings aren’t needed to buy cars. It’s supposedly needed to make investments but it’s not needed for that either.”
Didn’t mention cars, but if you maintain savings are not needed (though you then contradict yourself by stating monies can be put aside for larger stuff….otherwise known as savings) one can only assume that either the government will lend or gift monies for large purchases or that money itself will cease to be.
“And how did I propose to do that?”
you haven’t ….and that is the point.You have ignored the increasing demand by a society that only has to bring political pressure to obtain more or the same for less, how does your model propose to deal with that? This speaks to the inflationary spiral that would be created.
If what you have outlined here is a genuine model then you should at least be up front and admit the only way it would have a chance of successfully operate (at least briefly) would mean the end of private ownership, a completely closed economy that is likely to become increasingly unsophistocated and a totalitarian state that is mandated by the majority with no protection for dissenters….think we’ve seen where that leads..
So basically, you’re borrowing against the government’s income next year, as opposed to the government’s income this year. And if the money back doesn’t meet the money you’d spent, it’s inflationary.
How is that different from the standard bonds the reserve bank lends to banks? I can see why “lending” it to central government for infrastructure development rather than just to inflate the banking sector, but what you describe still requires conventional, basic budgeting, not a currently untapped source of revenue.
Nope.
Government creates the money
Spends it into the economy
Taxes money back out of the economy (destroys money)
No borrowing at all.
The economy is a continuous cycle.
Nope. Growing economy requires a growing volume of money. Of course, sovereign money can also be used to turn the economy into a Stable State Economy.
These would no longer exist. Banks would not be able to borrow from the RBNZ.
Also, the government borrowing from the private sector would also not exist.
I never called it income because it’s not income.
It’s the base driver of the economy.
But you said that to maintain the overall level at zero change (to avoid inflation), the government had to “destroy” a dollar for every dollar it created.
The money only does any good if the government spends it, gives it to other people. Pays a UBI, pays road workers, whatever.
To get it back to destroy it, the government needs to levy a tax or gain profit from a transaction.
You’re plugging extra money into the economy this year, but you need to avoid creating inflation by taking back a matching amount of money in taxes.
Let’s say you have annual tax revenue of 100bil in a country with a gdp of 300bil. You want to buy everyone a UBIferrari, at an additional cost of 40bil, so you print the required cash. Next year you need to raise $140bil in taxes and destroy 40bil of it, and your gdp is 340bil, so you’ve got ~12% increase in gdp and cash supply while the invented cash is still in the economy.
So you’re still left with government expenditure cuts or tax increases to maintain the monetary balance.
But the government doesn’t buy everyone a Ferrari now does it? Really, why would you come up with such a stupid example?
What it does is spend money to provide government services (Police, justice, etc). and the UBI. These people now have money which they want to spend. They spend it into the private sector.
As the money moves through the economy it’s taxed in various ways (returned to government). These taxes result in the money being destroyed.
Which bit about the government spending being balanced by taxes didn’t you understand?
And, no, you wouldn’t have to cut government services – ever. In fact, doing so would probably cause a recession because the money that the government is spending is the full and total supply of money for the economy.
I really can’t make it any simpler.
Government creates money
Government spends money into the economy via government services
Government taxes money back out of the economy destroying the money
It’s not necessarily to finance government spending but it is necessary to keep money circulating, other wise it goes stagnant and festers in speculative property prices.
If Graham Hart spent the amount of money McFlock suggests in what’s called the permanent money hypotheses Graham would explode in 20 secounds because of the heat generated from spending, so Graham simply can’t spend that amount of money, the role of taxation is to put it back into the hands of those who will spend.
Later curve: http://www.investopedia.com/terms/l/laffercurve.asp
Permanent money hypotheses: http://www.investopedia.com/terms/p/permanent-income-hypothesis.asp
Taxes?
Or stimulus from deficit spending, or even cutting corporate taxes can cause inflation, (at the risk of receiving a ban for mentioning Trumps name) Trumpism, there are so many ways to boost demand, my point is if MrFlock would try google first he wouldn’t come across as such an asshole
I chose an absurd example (actually “UBIferrari”) because the what is irrelevant to the discussion: it could be a UBI, earthquake repairs, or a moonbase.
The fact is that you’re still tying government expenditure to government income. In a particularly inefficient way. Because, like most economic theories, your model is to simplistic.
You want to spend money now in order to tax it back later. But rather than doing it with bonds (and addidng a “debt servicing” line item to the annual budget that’s a small proportion of what you actually borrowed), by flooding the economy in new money you necessitate getting it back as soon as possible. The end sum might be zero, but in my example you’ve still increased the money supply by 40bil until you’ve taxed it back. And artificial boom/bust cycle.
And how would you tax it back – monthly or quarterly variations in PAYE? How would that effect folks’ wallets? Or annually bounce the tax rate 15% up or down depending on what you want to build this year? you reckon that’s electorally sustainable? Again, for simply the same result: government expenditure that’s constrained by government income.
Read the theory again
We’re not starting at zero. We already have the government taxing and spending.
The government shouldn’t borrow money – ever. It has no need to as it can create money and not have interest charged on it. Just so long as it then destroys that money through taxation.
Why do people insist that the government has to pay interest on money?
And that is why your thinking fails. You think that the economy is static rather than a continuous flow.
Can you point me to where I said it would be otherwise?
What I said is that government spending through government services and the UBI should be the total money available to the economy. That this would stabilise the economy eliminating the ‘business cycle’ and poverty.
I don’t believe the economy is either static or a continuous flow.
I think there are lag times and elastic relationships throughout the economy, and my concern with your plan is that it causes a surge throughout the system, followed by a corresponding low pressure zone. And that causes more stress to individuals in the system, breaking some of them.
Whereas conventional tax/borrow and spend government policies don’t have that lag period where there’s a sudden boost in money supply on top of everything else.
But it doesn’t and that thinking is that of a static model.
The sudden boost in money supply that we’re seeing now is from the private banks creating huge amounts of money in lending for houses and offshore buyers of our housing.
Well, perhaps there is some niche economic definition of “static” – but I meant it in the conventional meaning of lacking in movement, action or change. Which is impossible in a system that has pressure waves, which by definition are change. But either way, simply saying that the model is “widget” doesn’t mean it’s wrong.
How does one create cash and avoid inflation in the period between when government pays the people and when it taxes that amount back off them?
The current boost in money supply is intentional policy by the reserve bank which is using a blunt tool to face a complex problem: a largely stagnant economy with one single sector that’s massively overinflated in price due to long term supply shortfalls.
That is a separate issue to whether your concept of printing (then destroying) money adds any advantage over the current conventions of managing government accounts.
Bruh. Economics is uncertain
See, you’re thinking that one thing happens and then the next thing happens at a later time when both will be happening simultaneously. The former is static model thinking.
Actually, it’s been the intentional policy of the government for the last ~30 years who legislated what the RBNZ was going to do, gave it the tools to do that and removed capital movement restrictions.
Actually, it gives advantage to the entire economy and not just the governments books:
1. By removing the private banks ability to create money it stabilises the economy from that direction. No more banks creating huge amounts and then panicking and stopping creating any thus throwing the country into recession/depression
2. They’ll be no need to borrow offshore to utilise our own resources as they’ll be plenty of money available
3. By ensuring that there is a constant influx of money into the system via the UBI ensures that there will always be a demand for businesses to supply
4. The UBI will ensure that everyone who wants to will be able to get a good education
5. The UBI will allow people to be entrepreneurial by ensuring that they don’t drop into poverty if their idea fails
6. The removal of interest bearing debt from government removes the need for continued growth
It seems to me that you’re trying to have it both ways: you said “As the money moves through the economy it’s taxed in various ways (returned to government). “. That means there’s a lag between when the money is distributed and when the same amount of money is finally returned via taxes. If there’s a lag then there’s a period of substantially increased money supply. If there’s no lag, then you’re not “creating” money, you’re simply transferring tax revenue into expenditure in exactly the same way it’s currently done.
Yes and no. It bypasses the fractional reserve system (which is merely a multiplier of the OCR tool, not an integral part), but that doesn’t mean that the banks will contribute any less to boom and bust speculative cycles.
Borrowing, either directly or by simply printing cash and borrowing that off future taxpayers, is a sign of insufficient taxation right now.
That is a benefit of a UBI in particular, but yes does apply to other government expenditure if it’s done wisely. IMO most importantly the government expenditure needs to go into the regions so it can flow back into the urban centres then the corporates, rather than just swilling around a few key CBDs.
Nah. That’s what the education system is for.
Fair enough, but this isn’t about the benefits of a UBI, it’s about how some UBI proponents intend to pay for it.
but printing money simply substitutes interest payments for boosts to inflation. Growth is therefore still necessary.
Nope because the taxes would go up at the same time that spending goes up. If spending doesn’t go up then taxes don’t go up.
And we’re not starting at a zero point. We already have a monetary flow. There’d be a transition period when inflation may be a little higher than normal but I doubt if it would last long.
Yeah, actually, it does:
1. The banks will no longer be able to leverage minimal funds into massive loans. They’re strictly limited to what they have on deposit for on-lending and the people who so deposited it won’t be able to spend it either thus removing that piece of leveraging as well
2. If a few people lose their money from speculation so what? The constant flow of money from the government will ensure that loss with have minimal feed on effects. Mostly, the banks won’t suddenly stop creating money and throwing us all into recession as happened in the GFC
Creating money which is then spent directly into the economy producing economic activity now is not borrowing.
People need to be able to afford to go and get that education and that’s what the UBI will do.
But creating money doesn’t automatically translate into inflation – as the vast printing of money around the world after the GFC proved.
So how does that differ with what blinglish currently does every year?
Ok, so there will be inflation, now we’re just quibbling over how large and sustained it will be.
It wasn’t the creation of money that created the GFC, it was the outright frauds that were committed with that money, that then made the banks terrified of lending money to each other in order to settle daily debts and tallies. They created a pyramid of bad loan packages, then as soon as the music stopped playing all the bankers dropped those hot potatoes so they wouldn’t get caught with their pants down (abuse of allegorical language intentional 🙂 ).
It is if taxpayers have to make it up, even in the near-immediate future.
Well, yes it does. That’s why they did it: boost GDP with the corresponding effect on inflation. Because they were at extreme risk of deflation and depression.
Maybe if we take a step back because interest rates set the rate at which you can borrow from the reserve bank but they are apart of the cost when settling transactions between different banks, and banks hang on to reserve in case the housing sector has a massive run on for cash, and they never pass on full rate cuts. But if you take interest away banks themselves still have guides to take on crises, and that’s just in case there’s a fiscal demand for cash.
The current system actually borrows the money at interest. The government borrows from private banks which create the money at the time. The addition of interest means that it can never be fully paid back which means we have an expanding monetary base.
Never mind the fact that the private banks also create money when they make a loan to private individuals as well.
Sovereign Money gets rid of that. It has the continuous creation and destruction of money needed to keep the economy moving but it doesn’t have the interest component that forces growth. A stable state economy would work.
The entire banking sector is a Ponzi Scheme – see above – which is why it fell over.
No it doesn’t.
Yes, that is one of the reasons why they printed so much money but the inflation didn’t actually eventuate. The other reason, and probably the main one, that they printed so much was to prop up the banks. If the Ponzi Scheme that the private banks run collapsed the way it should have then, yes, we would have been in a depression.
Of course, the best thing that they could have done to prevent a depression is implement a UBI and let the banks collapse. Instead they gave it all to the banks which then kept it instead of loaning it out for productive activity.
A UBI would have prevented a recession, kept local businesses going and allowed the market to correct for the banks fraudulent activities.
Bullshit. Of course it can be paid off, with interest.
And the “sovereign debt” equivalent of interest is the systemic costs of the inflation it creates, even temporarily.
or it did eventuate and without it the world would have gone into a deflationary spiral.
agreed.
Nah. The best thing they could have done was buy all the bad loans at crap market rates and renegotiate sustainable repayment terms for the borrowers, thereby starting one of the biggest state housing programmes in decades if not history.
Profit gouging (especially by multinationals, e.g. bank interest) is also destruction of money, if there’s a weak tax regime (or tax haven) and no reciprocal investment back into NZ
Similarly, GST & income tax is a highly regressive drag on the economy and devalues the work of the many, whereas the top few % rich in assets pay relatively no tax. In fact, because of the property bubble there are thousands of lucky/privileged/entitled Aucklanders whose net tax is probably less than zero.
On Planet Key, the wealthy pay no tax, and the poor get taxed on all income over $1
No it’s not. It may be effectively removed from circulation in the economy but it hasn’t been destroyed. It still exists and can be spent.
As I said in the rest of that sentence. Unfortunately, Aussie banks are destroying value by extracting billions from the NZ economy per year without commensurate spend back in to NZ
Yep, the dead-weight loss of profit. I’m quite aware of it but it not destroying the money. It can still be spent and it’s usually spent on assets thus driving asset price bubbles.
Monbiot has just written about Neoliberalism, the bastards behind the idea and how we are getting screwed and will always be screwed..
https://www.theguardian.com/commentisfree/2016/nov/14/neoliberalsim-donald-trump-george-monbiot
On Planet Key a severely unstable man is stopped by police after stalking a couple armed with a knife. They let him go to kill the very next day.
http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11748624
On the same Planet Key a journalist has his home ransacked by police after highlighting government corruption.
More public service incompetence, the sooner we privatize everything, the better.
Blame the workers. First port of call when something goes wrong.
Same with privatisation, offset the blame, a whole bunch of people with their hands in the air singing ‘It wasn’t me’ til you get to the poor shmo on minimum wage at the bottom of the ladder ‘It’s all his fault!’.
He says after fight clubs and death have been found in privatised prisons – due to the lack of standards in the privatised prisons.
Predictable response, sad, but predictable…
More of this national government and there worshipers failing to take any responsibility for anything the have wreaked over the last 8 years of office.
Nothing to do with chronic lack of resourcing in Police and cutting mental health services so that Bill English can put some nice numbers in a fucking spreadsheet…
If you are brave enough, this is Watkins’ fluff piece on Key. No analysis of the situation, just a gentle combing of John Key’s hair.
http://www.stuff.co.nz/national/politics/86503566/a-warning-to-expect-the-worst
No thanks, can’t stand that prick. The MSM have been drooling over him for a decade. WTF is wrong with them.
Then, if you really want to be sick in your mouth, watch this pan and scan drivel to dramatic orchestral music from the Horrid.
http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11748647
This is awful broadcasting. And this is what the Horrid want to do with the NZOA funding changes. They want to contest for public funding to produce this kind of crap.
Brave enough to tell the truth. Good on you Jeremy Corbyn.
http://www.independent.co.uk/news/uk/politics/donald-trump-lastest-news-jeremy-corbyn-grow-up-us-immigration-mexico-andrew-marr-a7414576.html
There’s no dedicated post today so put it here.
Noam Chomsky on Trump’s White House
http://www.truth-out.org/opinion/item/38360-trump-in-the-white-house-an-interview-with-noam-chomsky
Ha ha. I was lucky enough just now to watch the super big Moon-rise at about 68degrees from North in Blenheim. A lovely golden colour and just huge. Don’t think I will be around to see the next one.
This was my take on the super moon. It was last month though at moon-set facing east from the base of Mt Wellington where I live.
http://i.imgur.com/IlwdpNM.jpg
I’m calling it “night flight”.
cool photo. Too much cloud here.
It’s rubbish here tonight but I’ll get up early to have a look west again tomorrow am.
Nice one, weather in Auckland has been too crap for the last couple of days, I’ve seen nothing but grey
I do hope you have at least another 18 years in you. The full moon will be even closer on 26 November 2034. And there’s a total solar eclipse directly over the South Island in 2028 to tide you over.
Oh ianmac saw the same moon at the same time from the same place! Next one in November 2034.
We’ll both be around to see that one, yeah?
The picture header is in poor taste
Why?
This should be fun…..
The Harry Leslie Smith –
https://twitter.com/Harryslaststand/status/797843761757876224