Labour, don’t stand by while English lies

Written By: - Date published: 1:30 pm, February 19th, 2010 - 29 comments
Categories: bill english, Economy, labour - Tags:

I am flabbergasted that Labour has remained silent on Bill English’s repeated lie that the economy grew just 0.9% a year in Labour’s last term in government. This is your reputation and your legacy the little creep is lying about, guys. Stand up for yourselves. Where is David Cunliffe?

GDP did not grow by just 0.9% a year on average in the three years to September 2008 as English claims. It grew at 1.7%, nearly double English’s lie. It would have been even higher if not for the global recession at the end.

Compare that to English’s record of -2.2% growth in his first year in office, including a miserable 0.2% growth in the June and September quarters while countries like Australia, the US, and UK have had growth rates over over 1% per quarter. We should be experiencing strong growth too coming out of a recession, if only National had managed the economy properly and put a stimulus package in place. Instead, our economy is still losing jobs while unemployment rates decline everywhere else.

Come on Labour, have some pride in your achievements and set the record straight. If you don’t, English’s lie will become the truth.

29 comments on “Labour, don’t stand by while English lies ”

  1. tc 1

    Nice post… where near enough challenging of this and other blatant lies, Smith altering treasury doc’s, etc etc and thus my comments about looking like an opposition rather than the next govt.

    Labor too busy trying to be clever and intelligent instead of mastering the 10sec soundbite like trolley and other dimwits have, look at this week after some big hits on tolley/basher…..nothing.

    the electorate have to have it spelt out… well as some charm the likes of cunliffe can supply…..king/trev continue to frighten the kiddies.

  2. all of the liars and the lies should be constantly outed as publically as possible and there are just so many of them – is that the problem – overload?

  3. David Cunliffe 3

    Marty thanks for your post. Since English made his outrageous claims we have had work underway decomposing the amended GDP figures. The reasons for the change are quite technical and a considered response will be posted soon. I will be happy to rebut too some of the other desperate claims that embellished his recent socalled “major” speech.

    For my initial response to that please see:

    • George D 3.1

      Good to hear it David. And you’re right, if you’re to demolish them convincingly you need to dot all the i’s and cross the t’s…

  4. Rob 4

    Just be careful with stimulus, its is an artificial boost, with a hangover to still occur.

    The Australian building and infrastructure communinty is very concerened about what will happen once their stimulus programmes end. Currently the industry is being driven by schools and hospital projects. There is very little non government commercial construction occuring. The up shot of this is the prediction there will not be a lot going on after the stimulous ends. Its a very concerning picture.

    I am actually happy that our Govt reacted prudently to the crises. Imagine our position now with a much larger debt profile.

  5. Quoth the Raven 5

    Just be careful with stimulus, its is an artificial boost, with a hangover to still occur.

    I wonder if you’ve seen this – “Fear the Boom and Bust” a Hayek vs. Keynes Rap Anthem

    If you haven’t it’s a brilliant watch.

  6. Ed 6

    English was most uncomfortable this morning in answering a comment that Labour had left a net zero government debt position – but he still managed to lie and not have it followed up . . .

  7. Craig Glen Eden 7

    The Aussie Labor Goverment have done way more than schools and hospital projects in Aussie but shit if the Tories did just that in NZ it would be good.
    In the Gold Coast they are building a 180 bed extension at Varsity Lakes,plus each family got 1200 dollars at christmas, as for the not much building going on what a croc of shit! Their is development upon development being done by private Mum and Dad investors, I have personally visited these developments and they are nice homes. Awesome high rise buildings with homes and flats all sold before they are even finished.
    The Aussie Labor Goverment have also run water ,insulation and electricity schemes that have minimal costs eg 30 – 50 dollars that people can take up. Yup the Aussies are welcoming new restricted shower heads that cut their costs and energy saving light bulbs! Sound familiar Rob

    What did we get John Key and his cycleway. No sign of a recession over their Rob and they wont have to worry about a slow down because Kiwis are flooding in! Our Government have not been prudent they have been bloody irresponsible small businesses are dying while Double Dipton sits on his hand. The only answer the Nats have is more deregulation (like they didnt do enough in their 9 years in Government previous ) tax cuts and when all else fails which it will ,drill baby drill. No plan just take from the Tax payer and sell or assets to their mates. Yup what a plan what a funny guy, my arse ! Mr Sloppy and Double Dipton are both in competent

    • Rob 7.1

      Sure Craig, not to get personal on this, however the legacy of developments on the Gold Coast has been nothing short of interesting and many have got burnt The wash up still left over from the Raptor Group collapse is hurting a lot of creditors and suppliers. Aus housing is down significantly from 175K to 130K starts, especially in the key states NSW & Vic. The major companies CSR, Boral etc and even our own Fletcher Building are nervous about Aus.

      Anyway, my point is this, that being prudent and careful through this crises was a good strategy. If you compare to the US, where they literally through truck loads of cash at the issue. They are now running at over 10% unemployment, housing starts are down at 750K PA from a sustained base of 2.1M PA and they are now having to fund the extra debt. Not really a very nice picture. If we had followed the same route , I think we would be in real serious position.

  8. Herodotus 8

    Just wait there are rumours a plenty within a certian industry (Cannot be specific sorry) that some major players are on their last legs. But many companies fell over in the last couple of recessions just after the recovery commenced, who is at faultthe board members, the govt for accepting low priced tenders. It is not the blame of who ever is in power the day the coys go under. The blame for me is the foundations that are/have been established for the country to rebound. And sorry Lab did not build on solid foundations and the Nats are not displaying anything different. What really gets me here is that many contributors will only accepts 1/2 the truth, Nats are not delivereing but are blind to the fact that Lab crapped on us as well !!

    • Craig Glen Eden 8.1

      While Labour/ Cullen may have not been perfect they did reduce our National debt,invested in infrastructure, apprenticeship schemes, and Research and Development, which if they hadnt and had made tax cuts like Double Dipton wanted we would have been in the real shit now. Also who is to say what economic change would have occurred with Cunliffe holding the purse strings.

      • Herodotus 8.1.1

        There was below average growth and we as a counrtry fell back in OECD rankings. Think how we would be better coping with the financial termial now with an extra 1% growth over 4-5 years, and in 99 we were told that moving up within the OECD rankings was a priority, and it stayed as a priority until 2007 when it was for me realised that under the current regime this was not achievable, and were would we have been if dairy prices had not risen, we were just piggy backing this industry and no initiatives from any govt enabled this to happen just the world market.
        Tax cuts are not an answer in themselves but a component of any managed recovery, as long as there are other substantial measures that dove tail.

    • Rob 8.2

      Good point , one of the major failings in business is too much sudden growth. Having to fund large increases in stock and HR (amongst other expenses), sends many companies to the wall , especially when they start buying market share, ie to much discounting.

  9. Craig Glen Eden 9

    So picking up on what you both have said Herodotus and Rob you would like to see slow steady growth. Which is what you got under Labour plus decreased Government Debt. While I accept any Government can only do so much you have to say we did OK under Labour. It might not have been perfect and like I said some things ( structural in the economy) might have to change but I bet you this, National wont do it because they don’t have the plan. USA is in a totally different situation to us if the Democrat’s hadn’t spent the money what mess would they be in now. Aussie is a more realistic comparison if one is to be made.Their unemployment has gone down as their Government has chosen to stimulate and ours has gone up with no stimulus. So the gap is getting wider between the two. As H has alluded to it seems things here are very tight and more companies are about to go under, what damage will that do to the economy. So unemployment is up beneficiary numbers are up and I am failing to see how this conservative approach is working for kiwis.

    • Herodotus 9.1

      There is an interesting article in NBR re stimulus packages displayed as a pie chart, ours is similar in % as Chinas. Us is an unique economy in that it has greater protection, esp as oil,gold and other commodities are quioted in US$ so there is no currancy cross over effect., also as I understand they are printing money as if there is no tomorrow 80% of their debtm, a bit sicial credit policy. There will be many years 10 perhaps until we are aware of the effects of theses stimulus packages and if they worked or not.
      What I wanted is what the NAts rhetoric is saying, but I thought that there maybe some action to support this. Unlike Clayton Crosgrove the tax system is a mess and with greater tinkering becomming more unworkable. But the solution is not to fix this on its own there needs to be a complete package, tax, govt spending welfare what we want from NZ and how as individuals/families/business/unions etc we are to achieve this and the framwework required.
      We need boldness, and there is nothing bold with any party

  10. Descendant Of Smith 10

    The thing I fail to understand at times is how the failure of businesses seems to be constantly blamed on the government rather than on the people running the businesses themselves.

    It’s clear to me that business has good years and bad years and in the good years, in order to survive the bad years, you put some money aside for those years that are not so good.

    I’ve seen several businesses make massive and ever increasing profits for a large number of years and it seems to me very few have put money aside for tougher times. They have however spent plenty of money on corporate boxes, moving outside their core business and investing in things such as property, having lavish Christmas parties, increasing executive salaries, having lots of addons to salary packages ( magazines, vehicles, petrol, bonuses, phone rentals, clothing allowances) increase debt and bonuses and paying money out to shareholders.

    I’ve seen others who have quietly paid off debt and done things such as buy new machinery when the dollar was high, invest in training their staff and focus on improving systems and processes. In general my observation is that these businesses are coping better with the recessionary impact.

    Some did both.

    It seems to me that some of these business executives were quite irresponsible in taking a short term view and were too worried about their share price than anything else.

    I’ve always struggled to see why such things as corporate boxes or Christmas parties or staff shouts are tax deductible as an expense. They seem to offer little return to the shareholder and can be quite out of control. The individual perks could just be transmuted into a clear and transparent salary so it’s obvious what someone is actually being paid.

    With the calls for simplifying the tax system, treating everyone equally and lower tax rates maybe all these types of expenses should be removed as a business expense and be paid for out of post tax profit. Accepting that their is some value to the organization for these costs in relation to wellbeing of staff there could be a set claimable amount per head (say $200-00) as at the first payroll run in December. This could be claimed whether spent or not. Any excess to be clearly reported in the financial accounts. This means that rather than be accountable to the tax payer for any costs over the $200-00 per head they would be accountable to the shareholders.

    I wonder if the same spending would occur if it was much more publicly transparent. A small step maybe but one I thought worth musing over.

  11. gomango 11

    Its quite clear what the discrepancy is. English is quoting the average quarterly growth rate (annualised) for the period in question. See table 1.1 from the Statistics NZ report.
    So if you sum the monthly returns for the period from Dec 2005 to Sep 2008 you get a total of 2.6% over 3 years, or 0.9% per annum versus the pre-revision 4.2% total or 1.4% per annum.

    English is technically correct but I think the usual way of reporting year on year growth by the Stats dept is as described by Marty, but even so you wont win the “English is a lier” argument. The difference he is quoting (from 1.4% to 0.9%) is will correspond to the difference between the yoy figures quoted by MArty (and the stats dept) pre and post adjustments when adjusted for the difference in methodology.

    So this is great headlines – first by English, secondly by Marty – but both are technically correct, unusually in this case I think Marty is actually more correct (given some of his past leaps of faith with statistics.) I would argue that English owns the high ground quite clearly due to the pathetic response (or lack of) by whoever the current LP finance spokesperson is, and anyway – arguing about stats in public – who ends up caring? Cunliffe will just be seen as a boring pedant.

    Happy to be corrected on how GDP is usually reported – its not something I’ve focussed on for many many years.

    One other point that should be made is both sides of the debate need to ease up on the “look what govt x did in their first year of power”. Given policy lags, the first year of any admin – good or bad – is likely to be more due to the policies of the previous government rather than the new one. First budget doesn’t occur for six months and the policy changes announced in it generally start 6 months or a year later. Although I’d also argue that when you have two governments (Lab and Nats) who have such similar economic policies anyway in terms of their ability to influence the growth path, there’s even less validity in the argument that a change in government provides an instantaneous growth path change.

    • wtl 11.1

      No, I think what English described is technically incorrect. How can you simple average the quarterly figures across years? This ignores the differences due to the compounding nature of percentages – at the very least the percentages should be multiplied. But even if you multiply the the quarterly figures you will get an incorrect answer due to the adjustments applied to the quarterly numbers. One has to use the year-on-year figures to get the annual percentage.

      Note that the second figure in the Stats NZ report shows the percentage change in GDP (and in Table 2.1) on a yearly basis. Presumably this is how annual GDP growth is ‘usually’ reported – the figures are for Dec 06 ~3.2% Dec 07 ~1.0% Dec 09 ~0.0% (estimated from the graph). This is an average of ~1.4% for the period in question (Dec 05 to Dec 09)

  12. David Cunliffe 12

    Deconsturucting the English Patient

    This is the first of several comments and posts around Mr English’s use nof numbers, both in the House and in his recent “major” speech.

    For openers

    – English appears to be using highly variable quarterly gdp figures: when annual gdp data is used the average over the last 3 years is 1.74%
    – Over the 9 years of the LAbour government gdp growth averaged (using the revised gdp numbers from Stats) 3.2%, higher than the US (2.5, the UK (2.6) or the OECD average (2.5).
    – At the same time gross sovereign debt was cut in half from 35% to 17.7%
    – And unemployment cut to 3.4%, the lowest in 21 years.
    That is a record to be proud of,and one National is unlikely to match.

    Not bad for starters, more to come.

    • the sprout 12.1

      Great stuff. Keep chipping away, and keep an eye on the timing – space them just enough to keep the attention on errors flowing steadily, with an occassional flourish whenever he tries to pitch a set piece.

    • Herodotus 12.2

      David, you still or anyone else to comment on the lack of Lab’s ability for us to move up the OECD ladder, and when ever growth started to increase the Res Bank just screwed us with interest rates and the NZ dollar, then they blamed the housing situation. The influence of a govt does not cease the day of an election result cf gomango above. What gets me and I have commented previously is that the “benefit” of Lab govt and built on by Nats (perhaps) is our ability to bounce back. If we had progressed up the OECD ranking as was one of your aims, think that with 0.5% additional growth over 5 years we would economically be ahead post recession of where we were in 2008. We had a Res Bank act that failed NZ and nothing was done, our succes was inspite of any govt action, and to me this is the real failuer of any govt, NZ survives despite the govt not becasue of it!!

  13. Herodotus

    Your view is so myopic. You seem to think that NZ is failing as a country because of one particular statistic. And you ignore National’s performance. If you think Labour’s performance was bad then National’s is horrendous.

    Reminds me of what Robert Kennedy said about GDP shortly before he was assassinated. I have posted this before but I think we should always bear it in mind.

    ‘We will never find a purpose for our nation nor for our personal satisfaction in the mere search for economic well-being, in endlessly amassing terrestrial goods.
    We cannot measure the national spirit on the basis of the Dow-Jones, nor can we measure the achievements of our country on the basis of the gross domestic product (GDP)
    Our gross national product counts air pollution and cigarette advertising, and ambulances to clear our highways of carnage.
    It counts special locks for our doors and the jails for those who break them. It counts napalm and the cost of a nuclear warhead, and armored cars for police who fight riots in our streets. It counts Whitman’s rifle and Speck’s knife, and the television programs which glorify violence in order to sell toys to our children.
    Yet the gross national product does not allow for the health of our children, the quality of their education, or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages; the intelligence of our public debate or the integrity of our public officials.
    It measures neither our wit nor our courage; neither our wisdom nor our learning; neither our compassion nor our devotion to our country; it measures everything, in short, except that which makes life worthwhile. And it tells us everything about America except why we are proud that we are Americans.
    It measures everything, in short, except that which makes life worthwhile. And it tells us everything about America except why we are proud that we are Americans.’

    • gitmo 13.1

      I wish someone would assassinate you Micky boy your pomposity is flatulent.

    • Herodotus 13.2

      Wrong I do not think NZ is failing, we are not achieving what we have the potential, and all the spin from what was Lab and Now Nats does not hide this. I was not the one who stated that moving up the OECD rankings was a priority Lab in 99,2000,01,02,03,04,05,06 & 07 and with all our success we went backwards, where was the vision and the actions to follow up this vision? Whislst GDP in itself is only one aspect it does inpact on many others, if we as a country are falling behind in world terms we can afford less, health, human capital etc, our beloved clean green best place to bringup a family etc will loss traction. We will be like many 3rd wolrd countries with natural beauty. The tourists will come and we will be living in poverty. Similar to Fiji when the locals are working for a few $ but the tourists paying plenty for the priviledge.

  14. Daveosaurus 14

    … What a charming comment.

  15. David Cunliffe 15

    This is an interesting thread of ideas. We certainly do want to see NZ lift itself up the prosperity stakes. And the “how” would fill more columns than we have room for here…

    Some quick starting thoughts: it has to be about more than the “farm and the mine” if we want a high value, high wage economy (farming is of course core, but undifferentiated commodities are notoriously vulnerable to exchange rate swings, and the margins are often low).

    Sustainable competitive advantage is about developing that something special on top that keeps the margins up and the value coming – that in turn requires innovation, intellectual property rights, and the smart use of technology, capital and skills to leverage our underlying resource base.

    I am afraid all we have seen from National so far is a dumbing down of that debate by focussing on “deregulating” – essentially a pasive hope that if govt gets out of the way a thousand flowers will bloom. In a small, arguably subscale economy it jsut ain’t that simple or easy folks-otherwise we would all have become billionaires years ago. A more active partnership between governmetn and business is required to fast track high value opportunites and align resources.

    Secondly, and controversially, ownership matters. No point in getting farm or factory productivity up if the financial system captures all the gain and bleeds the value offshore. About 3/4 of NZ’s external deficit is not the balance of trade but the value of financial flows. The four Aussie banks typically send home more profit each year than is made by the entire NZX 50 companies. To fill the gap the National government is poised to flog off even more assets and further lliberalise the already very liberal overseas investment regime. Selling Godzone by the acre.

    We can’t solve that problem without getting savings up. Way up. Shame National gutted Kiwisaver. Nor can we do it with an outdated monetary poicy that targets inflation alone using one tool (the OCR) that makes the housing bubble worse, or at best is not sufficiently focussed to fix the bubble without immense collateral damage to exports. We need a bigger sovereign stake in our own econmy, before it irretrievably becomes someone else’s.

    Is it too late to fix? No I don’t believe so, but every year matters in our race against time. We can’t afford another three years of a National administration that barely understands the problem, has shown itself devoid of ideas, and patently can’t make a decision the latest focus group doesn’t like. We can’t turn this boat around steering by focus group. NZ needs clear goals and a plan to get there. Mr Key may be able to read a map, but he clearly has no compass.

    That’s my 2 cents worth for a sunny Saturday afternoon, wedged between my son’s 5th birthday party and a Bangladeshi community meeting!

    Keep the debate going.

    • Herodotus 15.1

      Nice to see some comment from an active MP, I will await some policy within the next 12 months, and a statement regarding WHAT the Res Bank would follow under your regime to macro manage the economy. Have a great birthday party and I hope you have Monday off to accompany the 1st day of school, and did not the cricket team go home yesterday, I am sure that will be a big part in the conversation.
      In conclusion we need a startegy and how this is to be implemented and what outcomes are to be dereivved from this

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    New Zealand and the United States have recommitted to their strategic partnership in Washington DC today, pledging to work ever more closely together in support of shared values and interests, Foreign Minister Winston Peters says.    “The strategic environment that New Zealand and the United States face is considerably more ...
    6 days ago
  • Joint US and NZ declaration
    April 11, 2024 Joint Declaration by United States Secretary of State the Honorable Antony J. Blinken and New Zealand Minister of Foreign Affairs the Right Honourable Winston Peters We met today in Washington, D.C. to recommit to the historic partnership between our two countries and the principles that underpin it—rule ...
    6 days ago
  • NZ and US to undertake further practical Pacific cooperation
    Foreign Minister Winston Peters has announced further New Zealand cooperation with the United States in the Pacific Islands region through $16.4 million in funding for initiatives in digital connectivity and oceans and fisheries research.   “New Zealand can achieve more in the Pacific if we work together more urgently and ...
    6 days ago
  • Government redress for Te Korowai o Wainuiārua
    The Government is continuing the bipartisan effort to restore its relationship with iwi as the Te Korowai o Wainuiārua Claims Settlement Bill passed its first reading in Parliament today, says Treaty Negotiations Minister Paul Goldsmith. “Historical grievances of Te Korowai o Wainuiārua relate to 19th century warfare, land purchased or taken ...
    1 week ago
  • Focus on outstanding minerals permit applications
    New Zealand Petroleum and Minerals is working to resolve almost 150 outstanding minerals permit applications by the end of the financial year, enabling valuable mining activity and signalling to the sector that New Zealand is open for business, Resources Minister Shane Jones says.  “While there are no set timeframes for ...
    1 week ago
  • Applications open for NZ-Ireland Research Call
    The New Zealand and Irish governments have today announced that applications for the 2024 New Zealand-Ireland Joint Research Call on Agriculture and Climate Change are now open. This is the third research call in the three-year Joint Research Initiative pilot launched in 2022 by the Ministry for Primary Industries and Ireland’s ...
    1 week ago
  • Tenancy rules changes to improve rental market
    The coalition Government has today announced changes to the Residential Tenancies Act to encourage landlords back to the rental property market, says Housing Minister Chris Bishop. “The previous Government waged a war on landlords. Many landlords told us this caused them to exit the rental market altogether. It caused worse ...
    1 week ago
  • Boosting NZ’s trade and agricultural relationship with China
    Trade and Agriculture Minister Todd McClay will visit China next week, to strengthen relationships, support Kiwi exporters and promote New Zealand businesses on the world stage. “China is one of New Zealand’s most significant trade and economic relationships and remains an important destination for New Zealand’s products, accounting for nearly 22 per cent of our good and ...
    1 week ago
  • Freshwater farm plan systems to be improved
    The coalition Government intends to improve freshwater farm plans so that they are more cost-effective and practical for farmers, Associate Environment Minister Andrew Hoggard and Agriculture Minister Todd McClay have announced. “A fit-for-purpose freshwater farm plan system will enable farmers and growers to find the right solutions for their farm ...
    1 week ago
  • New Fast Track Projects advisory group named
    The coalition Government has today announced the expert advisory group who will provide independent recommendations to Ministers on projects to be included in the Fast Track Approvals Bill, say RMA Reform Minister Chris Bishop and Regional Development Minister Shane Jones. “Our Fast Track Approval process will make it easier and ...
    1 week ago
  • Pacific and Gaza focus of UN talks
    Foreign Minister Winston Peters says his official talks with the United Nations Secretary-General Antonio Guterres in New York today focused on a shared commitment to partnering with the Pacific Islands region and a common concern about the humanitarian catastrophe in Gaza.    “Small states in the Pacific rely on collective ...
    1 week ago
  • Government honours Taranaki Maunga deal
    The Government is honouring commitments made to Taranaki iwi with the Te Pire Whakatupua mō Te Kāhui Tupua/Taranaki Maunga Collective Redress Bill passing its first reading Parliament today, Treaty Negotiations Minister Paul Goldsmith says. “This Bill addresses the commitment the Crown made to the eight iwi of Taranaki to negotiate ...
    1 week ago

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