Brian Fallow is one of the Heralds more understated columnists. Brian and I probably vote differently, but I find his articles usually worth the read. But there is understatement, and then there is deliberate obfuscation. His column today starts out workmanlike enough, repeating the PM’s case how average wages/salaries have increased in real terms around 6% over the last two years.
Then he turns to the median wages/salary figures released by Statistics NZ and shows how over the same two year period they have fallen 6%. That’s right… in real terms, the poorest 50% of New Zealanders are at least $80 per week worse off under National. This is how you can tell you have a Tory govt.
And then Brian concludes with a rather facile:
So depending on your point of view and which data you select, you can claim that people are 6 per cent better off or 6 per cent worse off.
What this really means of course is that the average and median income figures have diverged by around 12% in just two years. The only way this can happen is for the wealthiest New Zealanders to have gained dramatically at the expense of the rest of us. Logically this must represent a dramatic increase in income inequality in this country, a rather startling and damming conclusion Fallow studiously avoids making.
He almost gets there at one point: In statistician speak, “the distribution of earnings is asymmetrical, with a bulge at the low end and a tail at the high end”…. yet fails to drill into the implication of this. That in order for this long thin tail at the high end to have increased the average income by 6%, their actual incomes must have increased a great deal more than this. Again mute on a crucial point.
Those who actually read The Spirit Level will have noted how New Zealand already had one of the higher income inequalities in the developed world at the time the book was written two years ago, and how correspondingly poorly we performed on so many social health indicators. Now it turns out this govt has taken this already too high gap… and made it worse. In anticipation of the usual right wing tactic of blaming everything on the previous Labour govt, here is some data tracking several inequality measures for NZ since 1984.
Now I guess most of the regulars here at The Standard are none too surprised by this; especially those who’ve repeatedly pointed to Key’s astounding pre-2008 election comment about wanting to see wages drop. I have to confess that for a long time I was a tad sceptical that Key would have made that remark in the way it was reported. Well I’m thinking now I was wrong… that the numbers tell the story and Key did indeed mean what he said.
Because when you think that this govt cannot even build a decent cycleway in a timely fashion… you have to be impressed at exactly how effectively, how rapidly, this govt has made life better for their rich mates, while shamelessly paying for it from the pockets of ordinary working people.
All of which rather reminds me of Jared Diamond’s excellent book Collapse. In the course of the book he touches on a dozen or so long-vanished civilisations/cultures.. but dwells in depth on several. Perhaps the most poignantly recognisable were the Norse settlers in medieval Greenland who had carved a precarious niche in several coastal fiords of that otherwise uninhabitable land. In tracking the numerous factors that inevitably lead to their demise it’s quite remarkable how badly these otherwise intelligent and capable people responded to the external environmental and political changes impacting them.
Diamond points to evidence showing that due to the extreme shortage of desirable micro-climates, only a few farmholdings (the fundamental unit of their political structure) could hope to attain to prosperity and power… and thus inequality in this society was both extreme and unchanging. Which meant that the political/cultural decision makers, insulated from the suffering of ordinary Norse in poorer locations, stubbornly resisted the most obviously necessary changes (even simple things such as adopting more fish into their diet), protected their entrenched privileges and remained obtusely in denial of the limitations of their religious, cultural paradigms right up to the end.
But for nothing. As Diamond bluntly put it, “All their wealth purchased them, was the privilege of being the last to starve to death”.
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