English’s record under fire

Written By: - Date published: 6:58 am, August 11th, 2011 - 56 comments
Categories: bill english, Economy - Tags:

Stuart Nash put Bill English’s feet to the fire yesterday on his economic record. English has been claiming that the economy is in better shape to withstand another economic crisis than it was in 2008. Does anyone seriously believe that? We’re poorer, we’re more indebted, we’re less employed, and costs are higher.

Nash pointed out the following sobering facts:

  • When National came to office net government debt was 1% of GDP. It’s now 20%.
  • National has borrowed $36 billion in two and a half years. That’s $55 million per weekday.
  • The government’s credit rating is now on negative outlook. It’s the first time since 1998 we’ve been on negative outlook.
  • GDP per capita has fallen 2% since National came to power. Remember, the recession officially ended in March 2009 – the first quarter National was in power.

To those facts you could add the following:

  • There are still quarter of a million jobless.
  • Unemployment remains at 6.5%, whereas Labour kept it under 4%.
  • There are 3 times as many people on the dole now as when National came to power.
  • Emigration to Australia is at record levels.
  • Inflation is running at 5.3% while wages are rising at 1.9%.
  • Business credit has fallen by 10% while mortgage debt has risen 6%.
  • the median household income has fallen 2%. For Maori,the fall is 8%, and Pacific Islanders 16%.

Anyone who says the economy is better now and we’re better placed to withstand another financial crisis when it’s clear we’re not even back on our feet since the first one is either naive or lying.

56 comments on “English’s record under fire”

  1. Colonial Viper 1

    Bill English is spouting hopium to his colleagues and the masses. Inhale deeply folks, abrogate your better judgement and common sense, and vote for National.

    The man has the same amount of economics sense and imagination as a neo-classical economics textbook from 1981.

    • Draco T Bastard 1.1

      The man has the same amount of economics sense and imagination as a neo-classical economics textbook from any time in the last two hundred years.

      FIFY

      We really haven’t learned anything about economics since laissez faire was introduced into England in the 19th century. We’re still basing our economic decisions and policies around money rather than the actual resources that we have sustainably available.

    • KJT 1.2

      Hasn’t even progressed as far as Adam Smith yet!

  2. Radio NZ reported another $160 million chink in Blinglish’s budget.  The DOL put ACC savings at $400m over three years.  Treasury put the figure at $580.

    The DOL warned there was no actuarial or economic basis to the Treasury’s projections.

    Blinglish being the cautious competent minister that he is went for the larger figure.

    This is not the first example of this occurring.  Optimistic Treasury advice was also preferred over more cautious IRD advice.

    There are that many holes in the budget it would sink if placed in water.  Along with our economy … 

  3. aj 3

    English is merely parroting the lines that we’ll hear between now and the election. Keys, interviewed by Sainsbury a few evenings ago was spouting the same trip – I was waiting in vain for Saisbury to call him out on this rubbish.

    • Lanthanide 3.1

      Yeah. He got a nice little sting in at the very end about him not liking Labour’s plan that would increase borrowing in the short term.

  4. vto 4

    I don’t trust anything Bill English says. He simply lies and distorts to suit his ends. He would clearly not hesitate to say something like “GDP has risen under National” when it clearly has not. He is brazen. Him, Key, Smith & Carter – the bag of snakes.

    Get stuck into the pricks.

  5. tc 5

    Couple the lies with compliant non questioning soapboxes like closeup and the nation etc etc and the truth will always be an inconvenient and ignored commodity.

    They go there because they know they’ll be unchallenged, it’s all part of the deal particularly with TVNZ.

  6. illuminatedtiger 6

    National’s (mis)management of the economy has been a trainwreck but since the media aren’t doing their jobs the Nats will continue to take the piss and lie to the New Zealand public.

    • Draco T Bastard 6.1

      The MSM are doing their jobs. It’s just that their job isn’t what we think it is or should be (holding politicians and the rich and powerful to account) but covering for the lies of the politicians and the rich and powerful.

      • vto 6.1.1

        Well not quite Mr Draco. I would surmise that the job of the MSM is to sell their media. Reporting on everything and anything is surely just an add-on as part of that primary role of selling.

        The fact that their job is to sell is ok as long as we all realise that that is the case, and not assume that their job is to report objectively as part of the fourth estate. Today they are just another business.

        No more, no less.

        Bring back independently funded media.

  7. Craig Glen Eden 7

    Yeah its all fine to say that Labour are just winging about a press that is anti them but when 2.5 years go by and they continue reproducing the National Governments lies as fact it starts to look very suspect. The MSM can hardly say that Labour hasnt bought these issues to the surface because they are constantly being raised in Parliament.

    As others are saying pretty much all the figures show NZ has gone backwards yet thats not what we hear in the MSM its all smile and wave “John Key what a great guy”.

    When people start taking action the media say hey hey you cant do that thats criminal, well I have to say a media who tell lies on behalf of the National Government is actually what is criminal.

  8. jackal 8

    Yeah! That JK is just one of the guys eh! Meanwhile in the real world New Zealand is not in a good position to weather another financial crisis because National has mismanaged the first one. Namely tax cuts for the wealthy, corporate welfare, cronyism and putting the squeeze on the public. Nact is following an American model that is a sad and scary story, and one the MSM is failing to tell properly. Ignorance is bliss until that ignorance comes up and smacks you in the face.

    Eight comments with no RWNJ trolling, that’s got to be a record.

  9. Lanthanide 9

    I think there is a little truth in what Blinglish is saying, when it comes to the private sector. Most of the crappy businesses have already folded because they couldn’t handle the heat from the first recession. Those that are left are more resilient (like bacteria fighting an antibiotic…).

    Of course an additional recession, should we have one, isn’t going to do the economy any favours, but if it’s not too long or too deep then we’re not as likely to see as large a growth in unemployment as we did the first time. Of course it also means that the unemployed caused by the first recession will be even further ingrained.

    But he is still overstating it, and while the private sector may be able to get by without too much harm, the government won’t.

  10. queenstfarmer 10

    Gosh. Anyone would think there’s been the worst global recession since the 30s, collapse of the finance sector, major natural catastrophes, record oil prices, record exchange rates and sovereign debt crises.

    • felix 10.1

      …and a govt with an ideological aversion to taking any measures to respond to any of those things.

      • Lyall 10.1.1

        No Felix not quite. They have an ” ideological aversion to taking any measures (that you agree with) to respond to any of those things(in a way that you want them to). Quite different.

        • felix 10.1.1.1

          Sorry I forgot about their bold economic strategic response program.

          Tax cuts, wasn’t it?

          • queenstfarmer 10.1.1.1.1

            Yes. Just as well they didn’t go the other way, given the collapse of the Keynesian model.

            • felix 10.1.1.1.1.1

              If that’s so, then you’d best not crow about all this infrastructure and rebuilding then, aye?

              • queenstfarmer

                Not crowing about anything. Just stating facts. Fast tracking planned infrastructure projects is not the same as expanding Govt. It’s just a practical response in circumstances, which you have attempted to deny.

                • felix

                  My point is you’re dismissing Keynesian style stimulatory policy out of one side of your mouth and praising it out of the other.

                  Can’t have it both ways, q.

                  • Ianupnorth

                    Cycle track = job creation = epic fail; sad, but Kiwi’s believe them (National) – sad, sad, sad.

                • mik e

                  Expanding debt putting us in a more vulnerable position while the Tories in england have canned all motorway construction because its to dear and inefficient not worth getting into debt for qstf . Unless you haven’t read the amount this country spends on importing oil , obviously Steven Joyce hasn”t or he’s addicted to petrol fumes.

            • KJT 10.1.1.1.1.2

              More cognitive disassociation.

              It is the Neo-Liberal, not the Keynesian model, which has failed.

              Compare Argentina to the UK since 2002.

              Pity New Zealanders are not taught history any more.

          • Lanthanide 10.1.1.1.2

            You forgot how they pretended that all of Labour’s infrastructure spending was actually new spending by them.

            • felix 10.1.1.1.2.1

              Oh yeah but I have to take back the tax “cuts”, sorry, ‘cos as Mr Bill keeps reminding us they were actually a “revenue-neutral tax switch” so no harm no foul there.

              Cycleway?

        • mik e 10.1.1.2

          YOU mean borrow and hope, fudge the figures ,tax cuts for the wealthy user pay increases gst hike from read my lips. While we’ve had record receipts from our primary sector . Because of huge borrowing the returns our businesses have been getting are much lower than they should be lowering the tax take and employment. Savings are down contrary to borrowing Bills assumption causing higher interest and inflation causing more upward pressure on the dollar.The rednecks and media are to busy ogling smile and wave to ask any hard questions.

      • queenstfarmer 10.1.2

        What you mean is you don’t agree with the steps actually taken, such as fast-tracked infrastructure projects, zero budget, FRA / Securities Act reform, the Christchurch rebuild etc.

        • felix 10.1.2.1

          No, I mean nothing that’s done any good. As evidenced by the evidence.

          • queenstfarmer 10.1.2.1.1

            You don’t think they’ve worked, that’s fine. I agree they haven’t done “good” – not doing good is par for any Government. But that’s different to your incorrect assertion that the Govt was not averse to doing anything.

            • felix 10.1.2.1.1.1

              I don’t believe the things you’ve mentioned are actually a response to the issues you mentioned though.

              I think it’s just a bunch of stuff they wanted to do anyway.

              It’s like me having eggs for breakfast and saying I’m doing it to support the free range farm down the road, when actually I just like eggs.

            • Kaplan 10.1.2.1.1.2

              “not doing good is par for any Government”
              If you are comfortable with that, that is fine. It goes along way to explain why you are so comfortable with the current governments failings
              Meanwhile those of us that actually want a government that gives a shit will continue pointing out Nationals many flaws. Feel free to enjoy the ride.

    • vto 10.2

      Qstf, the collapse of the finance sector and resulting worst depression since the 1930s, and the sovereign debt crisis and resultant exchange rate volatilities, are the direct result of the unsustainable finance sector, which was deregulated, let loose, encouraged, and particiated in by the PM, by right wing policies, be it Reagan, Rogernomics or Ruth Richardson.

      This lot are continuing along the exact same path.

      I’ll give you natural disaster, but that’s it.

      • queenstfarmer 10.2.1

        Complete rubbish. NZ’s securities laws have changed little since the ’70s. The collapse of the finance sector was caused by the housing / property bubble that successive Govts allowed to blow out of control in the late 90s and 2000s, lax regulation and outdated laws. The Govt and in particular the Securities Commission was asleep at the wheel – Jane Diplock has a lot to answer for.

        Fortunately the Govt has started reforming the sector now, though whether a future Govt will once again allow the sector to get out of control remains to be seen.

        And the PM was in banking, not finance – there’s a big difference.

        • vto 10.2.1.1

          Qstf, complete rubbish. I was responding to your earlier post, which concerned mostly international events not just NZ specific events. Hence my reply in an international context.

          And re Key and his oh-so-productive money world, ok, it wasn’t the banking sector that needed bailing out internationally or in NZ was it. Nope, no banks joined the deposit guarantee scheme did they….. sheesh

        • mik e 10.2.1.2

          Prior to this there had been several attempts by Labour govts to put a more rigid frame work in place for the financial sector but National were dead against it, they and the financial sector said they would do a better job of self regulating than any govt could do I heard the arguments in parliament at the time.Its no place for govt to be involved they successfully argued!then they were hunting with the wolves no they are hunting the wolves.

          • queenstfarmer 10.2.1.2.1

            I’m sure National was dead against it at one stage (eg Brash era). Stupid. Thankfully Simon Power is moving things forward now.

            But it’s not credible to say Labour wanted to it but couldn’t. They had 9 years to sort it, they could pass whatever they wanted, they didn’t and it all went wrong on their watch. Although they can in turn shift at least some of the blame to Diplock.

    • Blighty 10.3

      the question isn’t ‘did bad shit go down’ it’s ‘is the country stronger now than in 2008’? and the answer is clearly ‘no’. So why is English claiming otherwise?

  11. randal 11

    I haven’t listened to any of the debate nor do I know the details but the sub text of any national party policy is fleecing the state.
    You have to watchout for that sort of stuff.

    • Draco T Bastard 11.1

      +1

      National really doesn’t care about the economy or the people. They care only for themselves and their rich mates. If they’re doing all right then the economy is no matter how many extra people are living in poverty.

  12. Afewknowthetruth 12

    The first time I ever heard Bill English on the radio around 1991 I thought said myself: ‘Who is that idiot and what planet does he come from?’, never expecting him to reach a position offering so much opportunity to destroy the NZ economy and destroy what remains of NZ society.

    He has the economic management skills we would expect from a 16-year-old who has just completed a sixth form economics and scraped a pass or as CV put it: The man has the same amount of economics sense and imagination as a neo-classical economics textbook from 1981.’

    There is much evidence to support the postulate that the government is deliberately wrecking the economy in preparation for an IMF takeover which will see NZ subject to ‘austerity’ and further looting by money-lenders and global corporations.

    However, since the present economic system is the problem, not the answer, and a global shortage in liquid fuels will bring down the IMF etc., the faster present economic arrangements collapse, the sooner we can move on to something better. In which case, keep up the good work, Bill. You’re doing a great demolition job. Keep lying to the nation. Some people still believe you.

  13. TEA 13

    Yes very interesting blog.
    English is a disaster, Key and English do not see eye to eye. This is a area to work on.

    I am unsure about who gets on with Smith. Somehow someway Smith and English need to be got stuck into.
    The Standard.org wastes far to much time attacking and criticsing Key.
    By all means – ATTACK SMITH and ENGLISH this is where the damage is being done.

    Plain and simple and unfortunately Key just smiles every thing off and gets away with all criticism.

    • pollywog 13.1

      Yup…thats what I’ve thought for a while too. The nats want to make it all about Key vs Goff in the election rather than Team Blue vs Team Red cos they know they’d get trounced otherwise.

      • Colonial Viper 13.1.1

        I also think that falling for CT’s presidential framing is a mistake. The entire Labour front row totally outweighs and outclasses the National front row. Ahem, excepting Brownlee.

        So LAB should team tag those blue b*stards.

        • Ianupnorth 13.1.1.1

          I posted a comment on the Facebook group “John Key has let down New Zealand” yesterday, more or less stating the same as TEA has said, namely get English, Smith et. al. and show up their failed policies, ignore Key, focus on the policies (this was in response to a comment made there saying it was all well and good collectively slating Key, but that wouldn’t change the government).
          The response was emphatic – everyone agreed, the job is to change the government and the policies, forget Key, he is Teflon.

  14. Afewknowthetruth 14

    queenstreetfarmer.

    Please explain what measures the government has taken to:

    1. reduce NZ’s vulnerability to the meltdown of fractional reserve banking

    2. reduce NZ’s vulnerability to worldwide sharemarket collapse

    3. prepare the nation for declining availability of oil

    4. prepare the nation for the food shortages that inevitably accompany the decline in availability of oil.

    5. prepare the nation for the collapse of globalisation which follows on from Peak Oil and will lead to shortages of clothing, footwear etc.

    6. prevent abrupt climate change making NZ largely uninhabitable a few decades from now.

    I think it would be fair to say that the government has taken zero measures on all issues that actually count.

    Gold is now close to $1,800, up from $1200 this time last year: that is a sure sign that everybody with intelligence and the capacity to shift out of corrupt ‘toilet paper’ fiat currency and bond markets is doing so.

    The truth is, we are governed by criminals and clowns who haven’t got a clue about anything in the real world and are only interested in propping up rapidly failing busibness-as-usual arrangements that provide them with rorts. That is something ideologues find rather unpalatable.

    • MrSmith 14.1

      Well..Well..Well…What about the cycle-way , so us peasants can still move around in the future. See that nice man Key really does care.

  15. Draco T Bastard 15

    the New Zealand economy having gone into recession well before the global financial crisis,

    So, is Bill English going to be held to account for his lies and misdirection? We did not go into recession before the GFC but as a general part of it. We also went into recession after the US and UK which were the two economic recessions that started the GFC.

  16. Marjorie Dawe 16

    I want to know how English is blatantly lying in parliament and how that could ever be seen to be honourable.

  17. The slavish pattern of following international economic trends is disturbing and disappointing. English’s claim – ‘we didn’t see it coming’ (regarding economic downturn) was either a lie or vacuous ignorance. Either way, unacceptable.

    The global trend of government financed, well, everything, is an elephant that is tipping the room on end. The left and the right (or call them the the new left) are fussing over the furniture as it slips about.

    On the horizon is massive turmoil in the global markets and national economies as the ponzi scheme of fiat currencies, Keynesian economics and massive government intervention are exposed to the analysis of actual results – and real wealth has already started to flee.

    The US (and many other countries like us) will continue to argue over the furniture – who should get what taken from from whom, who gets favour, and how the table should be laid. Rather, government should realise that they are simply no good at any of the things they feel they ought to do, and hand responsibility – and the furniture – back to the people.
    And then focus on their only real function, protection of that private property & property rights, and the the freedom and safety of its citizens.

    The countries must either default, or pay their way by printing new money – neither of which are particularly palatable. The collapses should have been allowed to happen when they started, allowing a real rebuild to begin.
    Printing money punishes anyone with savings as this devalues the currency and leads to real inflation.

    Or there is the option to do the thing which takes real guts, and revert to a gold standard.

    And we slavishly follow…

    So what did li’l old NZ do?
    What should we do next?
    What will Bill do?
    What would the Greens do?
    What would dLabour do?

    • Colonial Viper 17.1

      You’ve listed multiple misconceptions.

      There was a simple way for the US to avoid this in 2008.

      1) Reimplement a strengthened Glass Steagall.
      2) Breaking up all “Too Big Too Fail” banks.
      3) Returning US taxes to 1980 levels.
      4) Taking criminal action against those responsible for the most fraudulent financial activity in 2004-2007.

      You mentioned none of those steps.

      As to what we should do
      1) Remove our clean currency float and go to a managed, less transparent one.
      2) Take steps to reward savers and keep saved capital in NZ e.g. via KiwiSaver, bank capital requirements, foreign currency taxes (e.g. FTT).
      3) Introduce a higher tax rate for corporate windfall profits and reinvest the proceeds in the productive economy.

    • Colonial Viper 17.2

      Printing money punishes anyone with savings as this devalues the currency and leads to real inflation.

      This is also a complete misconception. It is unclear when or how printing money in a highly productive, industrialised economy can cause inflation.

      As far as I can tell, if the money supply matches the true level of goods and services being produced in an economy and facilitates efficient trade, then there is NO PROBLEM. Even if the source of those dollars are printed interest free by the government, and not credit created by banks and attached to interest bearing debt.

  18. CV, agree wholeheartedly with your point 4 in first response. A duty to protect, when in effect, ordinary investors were unable to challenge or sue those cronies and crooks responsible for fraud.
    Interestingly, all those bankrupt large companies are now taking action, with JP Morgan (I believe it is) about to be on the large end of a $10b suit. Great stuff.

    Not so sure about the other interventions, which at best would only delay the inevitable but were also, really, treating the disease with more of its own symptoms. There certainly were calls for re-looking at anti – inflationary policies in 2008, but as I say, this deals not with the root causes.

    You make statements like – ‘there were simple’, and ‘complete misconception’ only to go on and actually not back these black and whites up at all, and this is echoed particularly in your second reply.

    I am curious then for your opinion, what does cause inflation?

    • Colonial Viper 18.1

      Glass Steagall prevented another runaway debt/derivatives crisis for more than half a century after the Great Depression. Until it was repealed that is. Quite simply put, merchant and savings banks MUST NOT get involved in potentially illiquid and hugely loss making proprietary trading.

      There must be a firewall between the hedge fund operations of a bank and the bank part of the bank. If the hedge fund part suffers huge losses, no one will care, it can be left to die without causing massive contagion through the banking sector.

      The fact that you do not back its reinstatement shows you’re less than eager for true financial reform. In fact you are taking the side of the big “Too Big To Fail” investment banks who originally lobbied for Glass Steagall to be taken down.

      You make statements like – ‘there were simple’, and ‘complete misconception’ only to go on and actually not back these black and whites up at all

      You wrote your post like you were a financial pro who knew what you were talking about, I’m not going to condescend you by teaching you to suck eggs. Each step I suggested has been suggested by many other people, and the rationale is well known, as I am sure you know.

      JPM will get slapped with a wet bus ticket (if that), none of their executives will have jail time, and the manufacture of financial fraud will continue.

      I am curious then for your opinion, what does cause inflation?

      Excess and uncontrolled liquidity overwhelming the real productive sector of an economy.

      So, what do YOU think causes it?

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