Key’s plan arse backwards

Written By: - Date published: 11:21 am, May 25th, 2012 - 22 comments
Categories: budget2012, national - Tags: ,

Can’t be a good sign for Key that the media are starting to ask if there is a plan:

John Key: We do have a plan

Prime Minister John Key has denied his Government does not have a plan for growing New Zealand’s economy following criticism from the opposition about the Budget.

Key said on TV ONE’s Close Up tonight getting back to surplus is the first step to growing the economy.

See, that’s our problem right there. Key’s plan is arse backwards. Getting back to surplus is not the first step to growing the economy. It’s the other way round. Growing the economy is the first step to getting back to surplus. The problem is that the Nats have no idea how to do that.

What Key’s answer really means is that the premise of the question is correct, there is no plan. No wonder we’re in such a mess.

22 comments on “Key’s plan arse backwards”

  1. Steve Withers 1

    National’s supporters include too many monopolists and duopolists. They aren’t entrepreneurs. They want wages reduced and work conditions degraded….starting with the weakest among us.

    That isn’t a plan that takes new Zealand anywhere worth going….but it’s the only plan National has.

    It’s sad to see them be so consistently……stupid. But then the 47% who voted them are cut of the same cloth. But the rest of us have to wear the consequences….or leave the country.

    • ad 1.1

      Key – and indeed parliament as a whole – is now less and less the economic power-centre of New Zealand other than in a very basic level. New Zealand right now reminds me of the kind of state that Act was advocating for a decade ago.

      Building on your point, the oligopolies who run most of our core services have little effective public scrutiny (granted the financial regualtors are better than they were). Particularly annoying when an old scrote like Sir Ron Birerley can’t even get shifted with good sharehodler activism.

      We are increasingly a shareholder society, rather than a democracy. So we are governed, in any economic sense, by fewer and fewer people, who have greater and greater power. Money has become power.

      Increasingly, whether John Key has a plan or not is irrelevant, because we have not had an economically activist central gvoernment since the first term of the Lange government.

      Pretty strange when if we looked at New Zealand from beyond these shores, we are so economically tiny and vulnerable as to need every bit of the economy and the public sector working lock step in unison. Or continue to be played off by the likes of Maersk, Australian banks, French insurers, and the commodity exchanges.

      It will take the most almighty of structural adjustments to do that, and to be the Prime Minsiter of a plan to alter the future of New Zealand. I would vote for that party.

  2. ianmac 2

    Yes Rob. Saw that on Close up and was surprised that the questions were quite persistent and had Mr Key looking uncomfortable.
    As you say Growing the Economy would lead to surplus, but Mr Key does contend that it is not the Government’s job to provide jobs. Funny how they bask in in the glow of any recent improvements and blame 9 long years of Labour for “failures.” Can’t have it both ways.

    • Dv 2.1

      >>bask in in the glow of any recent improvements

      Huh, what have you seen Ian that I havent?

  3. Dr Terry 3

    The problem is that so many people take Key precisely at his word, not pausing to reflect upon the lack of logic therein. When one examines these words, one sees either a sly dog that depends upon our gullibility, or a leader who possesses little personal intelligence (putting it kindly!)

  4. tsmithfield 4

    From my update from BNZ Currency research, that arrives to my inbox daily:

    Markets have become too pessimistic on the outlook for NZ growth and interest rates. Forward indicators still point to a stronger pace of growth ahead, meaning market expectations of RBNZ rate cuts should be reversed in time.

    So, it looks like growth is coming, depending on what happens in Europe, of course. The rebuilding of Christchurch is an obvious driver for this.

    The problem with stimulus spending is that if it doesn’t actually lead to growth, as a number of countries have found out, all you are left with is a massive debt.

    At the moment, while our debt is low, it is much easier, and requires very little in the way of austerity to climb our way back out. I would rather this than spend like crazy and then find we have a huge hill to climb to get the economy back on track some time in the future.

    • Draco T Bastard 4.1

      Austerity = digging a deeper hole

    • mike e 4.2

      The silly monetarist downward spiral, look back in NZ hisTory every time we have gone down this path our economy has stayed in recession. which means we have to borrow more to stay stagnant.

    • muzza 4.3

      The fact you have signed up to that TS shows how little you appear to know about money!

      Our debt is low… um…No its not!

      What do you reckon the amount of interest we are paying each year might be on our govt debt, that sif you take it at the offical figures, which have never been audited!

      Go on then, have a guess!

    • Georgecom 4.4

      “So, it looks like growth is coming”

      TS, does it look to you like Santa may be on his way as well? How about the tooth fairy?

      Your mates Bill and John told you it looked like growth was on its way back in 2009, and then 2010, and 2011.

      • Colonial Viper 4.4.1

        Growth is not coming back. A toxic combo of peak energy, peak minerals and peak debt mean that the next 30 years will be very unlike the previous 30.

        Of course, all our politicians can say from now on is “growth is just around the corner…”

        • Ad

          On the one hand that sentiment sounds like standard Left Melancholy willing sustained catastrophe. The leftie analogue of The Is No Alternative.

          Although to undercut myself, the EU will take a decade to recover as will the US. Which blows back onto China’s manufactured goods.

          Mind you given the option of being Singaporean or Australian, I would be Singaporean.

    • Matt 4.5

      “The problem with stimulus spending is that if it doesn’t actually lead to growth, as a number of countries have found out, all you are left with is a massive debt.”

      So backwards. The stimulus expenditures are not what rack up the debt, it’s the underlying economic weakness that does it. In the States, it’s a common right wing trope that the ‘failure’ of post 2008 stimulus is evidence that stimulus is a waste of money, when in fact the problem was the inadequacy of the amount of stimulus. It’s like saying you need 20m3 of concrete to build a foundation, and you decide to only use 8m3, and then when it inevitably fails you say that concrete doesn’t work.

  5. Adrian 5

    ” ..while our debt is low..”. What bullshit is this TS, our ( Govt) debt is astronomical compared to 4 years ago and overall dangerously high. This is obviously a spin line that you are being paid to promulgate.

    • infused 5.1

      It’s not high at all, regardless of how it’s been in the past.

      • Colonial Viper 5.1.1

        Its private debt which is the killer, also our balance of payments.

        • infused

          I think people are continues paying back debt now… hence why there is no growth. Everyone I know is paying something off.

          I’m down to the student loan, with just 4k to go, about 1k on my cc. Like I said, everyones seems to be in the same boat.

          Basically, the country binged on credit from 2001 to 2008. I’d say the majority of people are guilty in this respect.

          • Ad

            Anyone for bets that with the same tax settings here, by 2014 we will have another real estate boom, both here and in Australia. And milk is back up trading to $8.50 of milk solids. And government is spending again. Christmas 2014, say.

          • Steve Withers

            A lot of people are now in lower-paying jobs than they were a few years ago. National’s policy on raising wages has been to lower them. Like much of what they said with respect to working people, the result is the opposite of what they promise. You don’t raise wages by giving employers more power and making workers weaker. You don’t raise wages by contracting out jobs that used to be done by employees on a decent wage.

            National’s pledge to raise wages was the same joke they played on Kiwis in the 90s….virtually unaltered. That enough Kiwis lacks the understanding to be suckered by it is a sad indictment on a huge proportion of the population.

            Roadkill on the highway of life…..

            The flow-on consequences of many thousands of people earning les money can only be that the economy is seriously constrained by consumer debt and falling wages.

            In response, NZ’s monopolists and duopolists are raising prices to keep their profits up in a flat market placing more pressure on the people already knobbled by lower wages and existing debt.

            It can’t last. It won’t.

  6. Uturn 6

    Ah I understand it now, some people don’t understand English or logic, that’s how they get sucked in.

    “Borrowing stimulates the economy, repaying debt stalls growth; spending by governments that chose not to influence the market (borrow) results in massive debt; repaying debt is evidence of previous low debt and rapid growth, but also over-stimulated economy, causing stalled growth. Everyone is guilty over over stimulating the economy; government should stop them repaying debt.”

    It’s hardly surprising that these, erm, “concepts” are offered by two resident collaborators with the status quo. But seriously guys, either you’re having a bit of a giggle – and I admit, if it were spoken instead of written, it would be an interesting rhetorical phrasing – or I might be the first to break the news to you, that either you have gulped the cool aid or you might be brain damaged.

  7. Matthew 7

    Getting back to surplus is no big deal, in fact its blindingly easy. Just slash spending until it is less than revenue. Regardless of whether the long-term effects of that slashing will cause massive extra costs in the future, it is that simple.
    NACT could, in all honesty, be in surplus by the next budget, but the slashing would be far too noticable. By doing it slowly, they think we will assume they have some sort of plan, which of course they dont.

    • Steve Withers 7.1

      Matthew: It probably isn’t that simple. Pulling the pins out from under a big chunk of the economy would / could have a big impact on revenue….and the money you’d save by cutting may find itself met by a further big downward bump in tax revenue. Carry that spiral on for as long as you can stand rising crime, social unrest and possible insurrection. You may still not balance that budget because of the increases required for police and security. Speculation? Sure. But absolutely supported by precedent in similar situations elsewhere.

Links to post

Recent Comments

Recent Posts

  • Compliance strengthened for property speculation
    Inland Revenue is to gain greater oversight of land transfer information to ensure those buying and selling properties are complying with tax rules on property speculation. Cabinet has agreed to implement recommendation 99 of the Tax Working Group’s (TWG) final ...
    11 hours ago
  • Plan to expand protection for Maui and Hector’s dolphins
    The Government is taking action to expand and strengthen the protection for Māui and Hector’s dolphins with an updated plan to deal with threats to these native marine mammals. Minister of Conservation Eugenie Sage and Minister of Fisheries Stuart Nash ...
    17 hours ago
  • Cameras on vessels to ensure sustainable fisheries
    Commercial fishing vessels at greatest risk of encountering the rare Māui dolphin will be required to operate with on-board cameras from 1 November, as the next step to strengthen our fisheries management system. Prime Minister Jacinda Ardern and Fisheries Minister ...
    2 weeks ago
  • Greatest number of new Police in a single year
    A new record for the number of Police officers deployed to the regions in a single year has been created with the graduation today of Recruit Wing 326. Police Minister Stuart Nash says the graduation of 78 new constables means ...
    2 weeks ago
  • Ensuring multinationals pay their fair share of tax
    New Zealand is pushing on with efforts to ensure multinational companies pay their fair share of tax, with the release of proposed options for a digital services tax (DST). In February Cabinet agreed to consult the public on the problem ...
    2 weeks ago