8,000 more unemployed in the last quarter of last year, and another 1,000 on the dole in January. New Zealand headed to a douple-dip recession the rest of the world isn’t seeing, after a year of anaemic (below population) growth. An average wage rise in 2010 of 1.9% with inflation of 4%. 5% of public servants have lost their jobs – including some from the fabled front-line.
What’s a government to do? Castigate themselves and work twice as hard to actually come up with some sort of economic plan? Or just use a tried a failed formula of asset sales and tax cuts for the rich because they’re too busy playing with statistics?
John Key said closing the wage gap with Australia was “the fundamental purpose of [his] government”. He also knows the gap (as measured by his own formula) has increased by over 30% in his time in office. So he knows that he somehow has to convince people their wages are going up more than they are.
The government’s focus has been coming up with a way to make it look like wages have gone up 16%.
Inflation is 6%, so a 10% real wage rise – does it feel like that to you? If you’re like me and thousands of other New Zealanders who didn’t get a wage rise at all last year, you know there’s something dodgy going on. And there is.
Average wages have not gone up 16%, they’ve gone up less than 0.4%. Median wage (ie not skewed by a few rich folk getting a big bonus) has gone down by 0.75%. This before inflation.
Key and English try to hide the dire state of the economy by using every statistical trick in the book. They invent a whole new measure of “after tax” wages, unused anywhere else in the world. They include Labour’s 2008 tax cuts as their own. They use the average instead of the median to get maximum gain from their top-rate tax cut and their rich mates giving themselves bonuses. They only include those employed, so as low-income people have lost their jobs wages have “risen”. They only include ordinary-time wages, so the fact that overtime has been cancelled for most is hidden.
Do you think they should be focussing on how they can use statistics to deny reality? Or would you rather they actually worked on an economic plan to improve the lives of New Zealanders? Work on the fact that 25% of students leave school for the scrapheap of the dole (50% of Maori/Pasifika girls), and increase skills training, rather than cutting education and removing Training Allowances. Work on keeping jobs in New Zealand, rather than force SOEs to take overseas tenders for things like trains. Work on investing in infrastructure to keep the economy goes in tough times, rather than slashing social services and public sector jobs.
There’s plenty to do, but John & Bill aren’t focussed on that.