Govt stimulus creates 2300 jobs

8 comments on “Govt stimulus creates 2300 jobs ”

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1. lprent 1

   14 December 2009 at 9:53 am

   Apart from the short-term thinking of the governments response. The media are hilarious.

   It should read “Govt stimulus only creates 2300 jobs”

   It was clear from the end of last year that the recession would be deeper and longer than the budget expected in March 2008. It was clear early this year that it would be deeper and long than expected in December.

   I think that it is optimistic to think that this is going to all be over before 2011 at the earliest. The lack of response from the government defending their unsustainable tax cuts, will make it deeper and long than it should be. Reminds me of 1990/1
2. Craig Glen Eden 2

   14 December 2009 at 10:19 am

   Thats funny because Paula Slapper Bennett keeps saying its 4000 jobs. Surely Bennett’s not lying or spinning the good people of New Zealand a line?
3. wtl 3

   14 December 2009 at 10:19 am

   LOL $500 mil/2300 jobs = >$200k per job
4. tsmithfield 4

   14 December 2009 at 11:31 am

   You’ve got to remember about the velocity of money. Those who get jobs directly from the stimulus spend the money and thus spin it through the economy creating more jobs along the way.

   I heard English talking on the radio this morning commenting that the government was still intending to carry on and spend the rest of the stimulus money on roading projects etc that have been brought forward.

   I am all for not borrowing more money if we don’t need to. We are already having to fund substantial deficits just to meet running costs. We are going to be competing in the market for funds, especially so when the U.S. et.al. stop their quantitative easing programs and start funding their deficits more from borrowing. So, the chances are that the cost of funding is going to increase markedly in the not too distant future.

   We are not the basket-case type of economy that the US and a number of European states are. Also, Australia is rocketing ahead with growth with obvious spin-offs for NZ exports to Australia. Also, the higher interest rates in Australia will drive down our currency with respect to Australia, thus making our exports much more competitive there. Also, we are feeding into the fast-growing Asian economies.

   I think we are going to do just fine without too much more help from the government.
   • snoozer 4.1

     14 December 2009 at 12:34 pm

     you’re talking spending multipliers, not the velocity of money.

     The velocity of money is the rate at which it is re-spent after each transaction. It’s assumed to be constant over the short-term for most purposes.

     You’re also treating unemployment as if it is costless, which it clearly isn’t.

     Because of the spending multiplier, there are plenty of jobs that the government could create with spending which would, in fact, end up improving the govt’s balance sheet with more tax and lower benefit payments.

     Quarter of a million Kiwis out of work and another 125,000 or so underemployed is not ‘doing fine’ by my count.
   • Zaphod Beeblebrox 4.2

     14 December 2009 at 1:03 pm

     Why then do you think roads are a better spend than say schools and higher education? Or perhaps Agricultural Research?

     Simply resorting to spending on easy to see hard infrastructure like ashphalt and praying that external conditions ate going save us – doesn’t that strike you as slightly naieve?

     Would you have any comment on Joyce’s Holiday Highway or which a couple of $mill has already been spent before ANY cost-benefit studies have been sighted?

Links to post

1. Jim B: posted on 14 December 2009 at 2:57 am
2. Nats’ ’stimulus’: $200K per job « The Standard: posted on 15 December 2009 at 11:47 am

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