National – pissing debt against a wall.

Written By: - Date published: 3:41 pm, March 11th, 2014 - 77 comments
Categories: debt / deficit, national, same old national, treasury - Tags:

Of course it could be that John Key announced the election yesterday to divert attention from the press release from Treasury today.

The deficit was $637 million dollars bigger than expected. In fact it was more than double the expected size. Why? Well  mostly because of much smaller tax revenues than previously estimated. So much for the mythic recovery that National’s spinners have been pushing over xmas.

Financial Statements of the Government of New Zealand for the Seven Months Ended 31 January 2014

The operating balance before gains and losses (OBEGAL) was in deficit by $1.1 billion, which was $637 million more than expected, mainly due to lower core Crown tax revenue across most tax types. This result was partially offset by lower core Crown expenses and higher returns from Crown Entities.

And of course it just gets better. Bill English, the master controller of debt, has failed once more. Who’d like to bet against actually achieving the surplus in 2014/5 that he has been promising since 2009. My bet is that it will recede at the horizon  into – umm when is the next election year? 2017/8. After all he has to put in election bribes this year.

Net debt was $631 million higher than forecast at $59.9 billion or 27.7% of GDP. This was primarily due to a higher than forecast residual cash deficit driven by lower than expected core Crown tax receipts and higher than expected operating payments. Delays in insurance proceeds being returned to the core Crown also contributed to the higher than forecast residual cash deficit.

Quite simply this government’s economic abilities appear to rival those of Muldoon. They keep raising debt and praying that the world will help them out. While they’re being helped by the sustained drag of Chin’s demand for milk powder, but even so they still can’t stop putting us further into debt. We just finished paying off the mountain of debt that National gave me back in the 1970’s and early 80s. Now the shifty party of crony business morons are trying to do it to another generation.

Being a typical National government, they’re dead lazy. Rather than going out and helping the companies who’d sustain us when the commodity boom to China dries up (as it will sooner rather than later), they prefer pissing debt against a wall waiting for “the market” to help them out. Where a Labour government would be trying to provide and environment for out young businesses to flourish and produce jobs, National does nothing.

About the only bright news is that the governments financial portfolio, things like the ACC and the Cullen fund are doing better than expected. Probably because they aren’t highly exposed to this governments dead hand on the economy.

Full release with chart and Financial Statements: mediareleasefsgnz7mthsjan14.pdf]

77 comments on “National – pissing debt against a wall. ”

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  1. karol 1
    11 March 2014 at 3:52 pm

    I would like some financial/economic types to do some fact checking on the figures John Key was spinning in Question Time today. Key does this slippery con man act by reeling numbers off very fast, making it difficult to focus on any one of them – something to watch in election debates!

    This extract is just some of the figures Key was spinning in response to Cunliffe’s questions – more at the above link:

    Rt Hon JOHN KEY (Prime Minister) : I think the word was “indicator”, but, yes, and we have official statistics that regularly measure those things. Last year average weekly wages went up by 2.8 percent, compared with inflation of 1.6 percent. The year before that, average weekly wages went up by 2.9 percent, compared with inflation of 0.9 percent. The New Zealand income survey shows that the median personal income from all sources went up by 2.7 percent in the last year and median household income went up by 4.1 percent. So although people’s circumstances are all different, it is very clear that, on average, cost of living increases have been quite modest and New Zealanders and their families have been getting ahead.

    • Bill 1.1
      11 March 2014 at 4:04 pm

      Well, when somebody says ‘average weekly wages rose…’ rather than something like ‘on average, wages rose by’…then I start to wonder what it is they are referring to. Are we to take them literally and assume they referring to a rise in the average wage (worked from that $47k figure, or whatever it is) or just assume they ain’t constructing their sentences very well and are actually trying to refer to the average rise in wages?

      I believe the playing with language that goes on needs the same scrutiny as the numbers. But maybe that’s just me.

      • karol 1.1.1
        11 March 2014 at 4:15 pm

        Well, maybe it’s also that the government is throwing out a lot of numbers – as part of the diversion that Lynn posted about.

        At Question Time today, Labour MPs made a number of points of order asking for Key and Ministers to be stopped and reprimanded for their overly long answers. Various ministers were at it, too – throwing out a load of numbers.

        Key repeated stats re-wage rises to Russel Norman.

        Nick Smith

        Steven Joyce

        • McFlock 1.1.1.1
          11 March 2014 at 4:48 pm

          announce election date, stall like a farmers’ market at question time – Collins and their (as I think they are) laundromat dinners own goal has them playing defensively today.

        • Tracey 1.1.1.2
          12 March 2014 at 1:44 pm

          Average but no median…

    • Jenny 1.2
      11 March 2014 at 8:46 pm

      Well, for starters, he is using average weekly wages – which of course are pulled upwards by CEO-types on $1,000,000.00 plus salaries. He would give a better idea of what the central tendency actually is if he quoted the median. He uses the median for “income from all sources” in the NZIS – so that includes rent and returns on investments. He is betting on us being to dumb to no that they are different measures

      • Puddleglum 1.2.1
        11 March 2014 at 9:19 pm

        Exactly.

        I think the general population would be thoroughly perplexed to know just how many ‘statistics’ there are on these sorts of matters and what each of them actually indicates.

    • Tracey 1.3
      12 March 2014 at 1:43 pm

      Reliance on average not median… means smoke and mirrors galore.

  2. Sosoo 2
    11 March 2014 at 4:17 pm

    Don’t worry. The media will calmly explain that this is just another of Cunliffe’s evil tricks.

  3. just saying 3
    11 March 2014 at 4:48 pm

    It is time to scrutinise the way inflation is defined.
    Inflation on essential items has been much higher than inflation in prices of luxury or non-essential goods and services. Some of these have deflated in price. I’d like to see comparisons of inflation according to what particular income groups actually buy. The result would show dramatic inequality imo.

  4. Ant 4
    11 March 2014 at 4:50 pm

    National are a classic example of the Kiwi management class, no long term vision, lots of feeble tinkering around the edges, lots of talk, no new ideas. The unfortunate thing is that the only ideas they do recycle are old and discredited.

    To make up for their lack of vision their time is spent fighting fires one by one, robbing Peter to pay Paul, and creating the right spin for the inevitable terrible results that are bound to follow.

    • Sosoo 4.1
      11 March 2014 at 5:08 pm

      What do you expect?

      If you create a social model that rewards hyper-competitive aspirational monomaniacs (otherwise known as “meritocracy”), how can you be surprised when the people who end up running the show are a pack of pillocks?

  5. Ad 5
    11 March 2014 at 4:56 pm

    This year I’d like Labour to launch a proper alternative budget – one that shows the shift in direction that the progressive side would take the country. I don’t want this election to be solely about the best slogan, happiest smile, and wittiest withering put-down.

    I’d like Labour to respond not inside Parliament as they usually do, but with a press conference outside Parliament – as the Budget speech is being read – that explains Labour’s approach to the Christchurch debt, Labour’s approach to the NZSuper fund allocations, Labour’s approach to balancing the projected amounts from a Capital Gains Tax and corresponding changes in income tax.

    I want David Cunliffe to tell us why he and his team are superior at handling the economy and the public finances – just as Helen Clark and Dr Michael Cullen did for 9 budgets in a row (except maybe the last one when things were generally going tits up).

    I don’t think this is the year for Business As Usual – I think it’s time for more stunts direct to tv.

  6. Seti 6
    11 March 2014 at 5:03 pm

    “Well mostly because of much smaller tax revenues than previously estimated.”

    Perhaps it was less than forecast, although tax revenue was actually $2.37b or 4.9% higher than the same 7 month period last year. Pretty healthy growth.

    • lprent 6.1
      11 March 2014 at 7:41 pm

      Yes, but these fools that you follow have been forecasting strong business growth next year for how many years? The problem is that I suspect most of the tax growth has just come from companies running out of accumulated losses As their mild return to profitability was from cutting costs and retrenchment.. It hasn’t come from either business or jobs growth.

      Guess what was required for any of the lazy National fools plans…

      • JM 6.1.1
        16 March 2014 at 11:19 am

        ‘You suspect’ but have absolutely no idea. I run a business in manufacturing and I can tell you that the last two years have been the best in the last 10. This is also true for many associate’s and the simple way to verify this is ask the transport companies they are the barometer to growth , but hey, don’t let any good news get in the way of your myopic red eye view.

        • lprent 6.1.1.1
          16 March 2014 at 3:19 pm

          I do have an idea. My family has been pretty much in manufacturing for the last 5 decades. Both my father and my sister made their profession as a manufacturing operations managers. While I used to run factories. While these days I write code for export and the company contracts out the manufacture of the hardware, I still keep an ear to the ground in quite a few production paces.

          Basically you appear to lack perspective, and by the sounds of it you’re a bit of an idiot. After all transport companies move around a lot more imports and raw materials for export than they do for any local manufacture. The daily pickup routes for milk alone probably exceed all of the manufactured goods movements.

          The Stats department is reporting manufacturing plateauing in revenue and jobs after a pretty disastrous drop after 2007. The number of manufacturers going out of business has finally diminished. But while there has finally been an upturn in sales revenue this year outside of the farming sector, it has pretty much only just in 2013 after 4 years of declines or static sales. Jobs are damn flat in manufacturing outside on the farm processing sector.

          But here. Improve yourself and read the stats…

          http://www.stats.govt.nz/browse_for_stats/industry_sectors/manufacturing_and_production/EconomicSurveyofManufacturing_HOTPDec13qtr.aspx

          You’ll note that important statement looking at the rise compared to the year previously

          Sales (seasonally adjusted) for the December 2013 quarter compared with the September 2013 quarter.
          Volumes
          Total manufacturing rose 5.7 percent.
          Excluding meat and dairy product manufacturing, sales rose 0.9 percent.
          Meat and dairy product manufacturing rose 15 percent.

          Values
          Total manufacturing rose 6.3 percent.
          Excluding meat and dairy product manufacturing, sales rose 1.1 percent.
          Meat and dairy product manufacturing rose 18 percent.

          In other words outside the farm processing sector the rise in sales and volumes is minimal over the last year.

          Fuckall use to the rest of NZ eh? Minimal new jobs in doing minimal processing of farm products and raw logs. Manufacturing firms still not able to kill off those accumulated losses and therefore not paying taxes. Treasury fucking up their revenue models in the areas that pay taxes (farmers usually don’t) because they persist in seeing growth where none exists.

    • Puddleglum 6.2
      11 March 2014 at 9:08 pm

      Which makes you wonder why the forecasts were so rosy.

    • Tracey 6.3
      12 March 2014 at 1:46 pm

      Hasnt the tax take been lower than expexted for 3 to 4 months now?

  7. Enough is Enough 7
    11 March 2014 at 5:21 pm

    It just makes me cringe thinking what could have been.

    We had a decade of surplus under Labour and we were the envy of every developed country in the world. Then in 2008 along came the crisis known as John Key and blew it all in a game of poker.

    Just for a second imagine how great and propserous this Nation would be if Labour had stayed in power in 2008 and continued to provide the surpluses it was renown for.

    • Wayne 7.1
      11 March 2014 at 5:31 pm

      You must have forgotten the global financial crisis of late 2008 that pretty much lasted 3 years. Or did John Key singlehandedly organize that for the whole world, just to drive NZ into debt.

      • Draco T Bastard 7.1.1
        11 March 2014 at 5:32 pm

        He was certainly part of the clique that did drive the world into crisis.

        • Colonial Viper 7.1.1.1
          11 March 2014 at 6:54 pm

          Indeed. Merill Lynch was one of the Fed’s “primary dealers.” Aptly named, if I do say so myself.

        • (Not the) Voice of Reason 7.1.1.2
          12 March 2014 at 9:13 am

          [deleted]

          [lprent: Standard flame troll pattern with clear indications of identity jacking. Comments deleted and auto-spammed. ]

          • Te Reo Putake 7.1.1.2.1
            12 March 2014 at 9:23 am

            Just to avoid confusion, that Voice of Reason ain’t this Voice of Reason.

            • thatguynz 7.1.1.2.1.1
              12 March 2014 at 11:00 am

              Nor is he/she the voice of reason.. All they have demonstrated is a complete lack of knowledge about how the GFC came to be although they have correctly identified who the punters were that lost money. I’ll give you a hint VoR – it was a massive transfer of wealth from Main St to Wall St.. Go do some research.

          • Tracey 7.1.1.2.2
            12 March 2014 at 1:48 pm

            I started laughing until I realised you believe this…

          • Dave_1924 7.1.1.2.3
            12 March 2014 at 2:36 pm

            The GFC started due to poor banking practice – namely lending money to people who couldn’t repay it aka sub-prime loans, in the worlds most influencial market place. Then pooling those loan assets up into a new security and selling them on to other financial institutions all with a dollop of derivatives based on those securities. When the underlying economy gets the jitters the borrower via the sub-prime gets squeezed and that asset goes toxic i.e. loses value based on the underlying cash flows of repayments stopping. And that all flows up the chain via the pooled, packaged and on sold securities. Amplify that via derivatives and you have a huge mess.

            Who’s to blame for that?
            The Bankers for building and selling it
            The Banks, Insurance Companies, Super Funds etc. who bought the packaged Sub-Primes and thought they could hedge their exposure away via derivatives?
            The Politicians who enabled it via reformed banking legislation and via “encouraging” banks to lend to the sub-prime market to allow the less well off to live the American dream and buy a house of their own?
            The punters who borrowed money whilst having a poor credit history and insecure earning capacity?

            OR All of the above – I vote all of the above. And all of the above were driven by greed

      • Blue 7.1.2
        11 March 2014 at 5:37 pm

        I’m pretty sure he organised a whole heap of tax cuts and corporate welfare for South Canterbury Finance.

      • Anne 7.1.3
        11 March 2014 at 6:33 pm

        Well, that’s pretty much what you lot said about Helen Clark in 2008. She and Cullen were – apparently – “singlehandedly” responsible for the financial crisis which drove NZ into debt.

        Can’t have it both ways mate. If Key and English aren’t responsible then neither were their predecessors.

        Edit : just seen DTB’s comment. Ditto… Key certainly is part of the clique who put us all there in the first place!

      • karol 7.1.4
        11 March 2014 at 7:00 pm

        That’s the spin line National MPs keep using in the House – they say the opposition thinks the GFC never happened.

        That’s totally wrong of course. The left remembers the GFC and what/who caused it. So we are wondering why National, & the global right, keeps using the same approaches that caused the GFC.

      • Jenny 7.1.5
        11 March 2014 at 8:49 pm

        Not single-handedly but he was one of the the hands that caused it , yes.

      • Puddleglum 7.1.6
        11 March 2014 at 9:31 pm

        Wayne,

        National has missed a once in a lifetime (or two) chance, courtesy of the GFC, to reorient the economy. It chose, instead, to sit on its hands and suck on the udder.

        It’s very reminiscent of the behaviour of CEOs who go for short-term share price inflation over long-term robustness because their ‘tenure’ at the top is fleeting and they just want to meet their KPIs (look good to electors) to collect the share bonuses (get re-elected).

        All that borrowing just to do ‘business as usual’ and satisfy what Matthew Hooton rightly calls the never-to-be-underestimated personal ambitiousness of John Key.

        • DS 7.1.6.1
          11 March 2014 at 9:42 pm

          National is a conservative party. Sitting on its hands is what it does.

        • McFlock 7.1.6.2
          12 March 2014 at 12:02 am

          National has missed a once in a lifetime (or two) chance, courtesy of the GFC, to reorient the economy. It chose, instead, to sit on its hands and suck on the udder.

          Actually, it chose to use the GFC as an excuse to sell assets, some of which were built during previous recessions and depressions by smarter governments.

          The level of disgust this government deserves is astounding.

      • dave 7.1.7
        11 March 2014 at 11:16 pm

        gfc is on going and still with us its a slow moving train wreak professor Steve keen said Govt. and public debt cant be separated they must be viewed as one and the same the result is a broken economy and a social disaster .

      • Tracey 7.1.8
        12 March 2014 at 1:47 pm

        Is this a tpp thread?

    • dave 7.2
      11 March 2014 at 11:03 pm

      what i worry about is what they are hiding 1984 comes to mind when Lange opened the books to a horror story history can repeat itself

      • thatguynz 7.2.1
        12 March 2014 at 11:03 am

        Agreed Dave. I’ve heard a number of rumours about an “off balance sheet” derivatives exposure for the govt (or Reserve Bank) that runs to hundreds of millions of dollars + but I haven’t seen any tangible proof.. yet.

  8. mickysavage 8
    11 March 2014 at 5:22 pm

    This should hurt because National is going to run on the basis it is a sound financial manager and it will get the accounts back into credit as promised. If it fails to do so then this will be a significant failure. Hence the flag diversion …

    • Arfamo 8.1
      11 March 2014 at 5:40 pm

      It should hurt, but given Key’s consistently high personal approval ratings and mastery of the art of telling people they are actually going to hell in such a charmingly dismissive and positive way many of them are looking forward to the trip, that remains to be seen.

      Opposition parties need to be all over the figures they’re tossing out, and they need to be able to articulate the plan to halt the debt madness.

    • Ad 8.2
      11 March 2014 at 5:50 pm

      It will only hurt if Labour shows how much better they would be at it. Otherwise National will simply say: “No-one could have predicted the dual effects of recovering from the GFC, and Christchurch.”

      Irrespective of whether that’s true, it’s an excuse that will ring true in the public against any high principle of fiscal rectitude National might otherwise aspire to.

  9. Draco T Bastard 9
    11 March 2014 at 5:31 pm

    Where a Labour government would be trying to provide and environment for out young businesses to flourish and produce jobs, National does nothing.

    National aren’t doing nothing – they’re quite specifically selling us into debt-peonage.

  10. Sosoo 10
    11 March 2014 at 5:53 pm

    So Prime News relegated this item to 20 minutes into its half hour broadcast, but supposed Cunliffe gaffes were a lead item.

    They aren’t even trying to hide it anymore.

    • risildowgtn 10.1
      11 March 2014 at 6:26 pm

      Thats why their Facebook page is great to let them know and those others who read it , the truth … and its fun to see trolls hop madder and madder esp when using evidence and all they do is try and divert the threads… no such luck…..

  11. Ergo Robertina 11
    11 March 2014 at 6:47 pm

    The economy’s a weakness for National, but where is Labour spelling out the alternative?
    Mr Cunliffe is often reported saying his Government can walk and chew gum at the same time, which I interpret as: balancing the books, while paying some more workers a living wage, and addressing NZ’s economic structural problems. This prevarication without spelling out priorities adds to the perception he says different things, to different audiences, with different emphases.
    Worryingly, on his Sunday Q and A interview, Mr Cunliffe cited a Harvard degree as particularly qualifying him to transform the economy. Hello – it’s not the 1990s any more; these institutions have no credibility .
    Being upfront about all this would help negate any public perception of him as arrogant.
    Labour is intellectually adrift. My sense that Mr Cunliffe had the ability to rectify the malaise is fading.

    • Bearded Git 11.1
      12 March 2014 at 10:45 am

      Don’t buy into the MSM’s slamming of Cunliffe-he is smart and will roast Key in the election debates.

      Of course Labour has a plan but they won’t release policy early, that is now, because Key will then steal it.

  12. Colonial Viper 12
    11 March 2014 at 6:58 pm

    Why does everyone seem to be buying the BS that sound Government economic management = balancing the books or running a surplus?

    Such a strategy greatly increases austerity and private sector (household debt). It’s the worst thing that can be done to NZ during a time of major and ongoing current account deficits.

    • Arfamo 12.1
      11 March 2014 at 8:42 pm

      Well, the problem is nobody in politics who can attract the attention of the media and the public seems to be articulating this point at every opportunity. I haven’t seen it being made on Q&A, or The Nation, nor even in The House for that matter.

  13. feijoa 13
    11 March 2014 at 7:04 pm

    Sorry, maybe I’m stupid, but if the average wage is going up , etc, etc then, ahem, how come tax revenue is going down???

    • Arfamo 13.1
      11 March 2014 at 8:43 pm

      That’s a very good question. Has any opposition politician been asking the government or the media this?

      • karol 13.1.1
        11 March 2014 at 8:51 pm

        Here it is said that for the March 2012 year, the average wage rose by 3.8%. At the same time,

        The seasonally adjusted number of total weekly paid hours fell 0.5 percent for the same period

        • Arfamo 13.1.1.1
          11 March 2014 at 8:52 pm

          Yeah. Funny that, Karol.

          If income tax receipts are down isn’t that also a likely indicator fewer people are working, after so many layoffs in the public service and other business closures, and that many of those who lost jobs or who are supposedly now off welfare and getting jobs are probably getting only part time work or crap insecure jobs for short periods at minimum wages. The government should be getting hammered for answers to why this shortfall, because income tax receipts shouldn’t be down if we’re having an “economic recovery” and more people are getting jobs, as we’re being told.

          • karol 13.1.1.1.1
            11 March 2014 at 8:56 pm

            Actually, that link I gave above said that there were fewer part time jobs – so probably many who were struggling to survive on part time work were laid off.

            • Arfamo 13.1.1.1.1.1
              11 March 2014 at 9:04 pm

              Yeah but it only mentions that there are fewer part time jobs in some industries, mainly in Education and Training. I get the impression part-time work’s increasing in some of the low paid jobs as some employers try and casualise their whole workforce. Though I notice also our local supermarkets have been cut staffing down radically this year and are moving big time to self-service automated checkouts with only a couple of staff on duty as helpers, so even checkout jobs are disappearing at a very fast rate.

              • happynz …
                11 March 2014 at 9:48 pm

                Yeah but it only mentions that there are fewer part time jobs in some industries, mainly in Education and Training.

                Yup. I went from full-time to part-time to time’s-up. I’m still doing training, just no longer doing it in New Zealand.

                I’d love to return to New Zealand. Yet, without a job to go to I need to figure out something else to bring in a crust to afford the absurdly high cost of living in Aotearoa.

    • Ergo Robertina 13.2
      11 March 2014 at 9:09 pm

      The tax take includes GST; people are spending less, plus many public sector organisations and businesses have slashed spending on the likes of travel for conferences/meetings etc. Has a big flow-on effect.

    • dave 13.3
      11 March 2014 at 10:56 pm

      there is a reason English is called bullshit bill

    • Tracey 13.4
      12 March 2014 at 1:53 pm

      Because the biggest chunk of rises will be in the top 1% who have tax minimisation vehicles.

      Also all those people who came off benefits… where are their taxes?

  14. bad12 14
    11 March 2014 at 7:54 pm

    The Rock Bottom Economy is exposed, could the IRD personal tax take be down because the numbers of those now denied the unemployment benefit have gone through the roof prompting a whole set of false economic assumptions,

    Its easy to see why the receipts from GST and business taxation have fallen, National 3 years ago went from the top of the country to the bottom in an orgy of sacking a large part of the IRD workforce,

    As time moves on, more and more in the business world are realizing that the IRD no longer has the staff capacity to follow up on due taxes so they are simply giving themselves a tax holiday,

    The growth is in the figures, if the taxation then does not match the growth figures either these figures are wrong, OR, the majority of the 800 odd millions of taxation not being collected is being avoided or evaded…

  16. feijoa 16
    11 March 2014 at 9:59 pm

    So……we dont have a rock star economy then?????

  17. dave 17
    11 March 2014 at 10:50 pm

    I don’t know whose wages slippery is taking about mine in real terms has went backwards key and co must be on LSD

  18. RedLogix 18
    11 March 2014 at 10:52 pm

    Yes any govt would have had to borrow to cover the GFC and the rainy days that followed. But deliberately slashing revenue as well was obdurate ideological madness. There’s a line in Lynn’s OP that hits home for me:

    We just finished paying off the mountain of debt that National gave me back in the 1970′s and early 80s. Now the shifty party of crony business morons are trying to do it to another generation.

    I very clearly recall as a teenager my father – who knew Muldoon personally – tell me “You’ll spend all your adult life paying off the debt’s this self-styled, self-deluding ‘economic wizard’ has racked up”.

    Well not quite all my life. At one point I had the privilege of shaking Dr Cullen’s hand and thanking him for what he had achieved. (He was terribly embarrassed at my gushing…).

    Now it’s happening all over again.

  19. Stuart Munro 19
    12 March 2014 at 1:35 am

    Worst of all, the world economies refused to learn the lessons of 2008. Financial markets remain soft with even China no longer growing strongly. NZ’s local recession is about to be worsened by a global recession. And to think, until that silly woman Maggie Thatcher got involved, the western economies had largely put the spectre of cyclic depressions behind them.

    • RedLogix 19.1
      12 March 2014 at 8:23 am

      Worst of all, the world economies refused to learn the lessons of 2008.

      There were a number of things which could have been done post-2008. But all of them would have weakened or challenged the position of the bankers and money men.

      And for this reason they were not allowed to happen. They money system has humanity utterly in it’s thrall.

      The only thing that will break this spell is a complete change of heart.

      • Colonial Viper 19.1.1
        12 March 2014 at 8:49 am

        The only thing that will break this spell is a complete change of heart.

        The top 0.1% are not going to have a change of heart, that I can guarantee. Oligarchs serve the interests of oligarchic class, full stop. That has been the pattern throughout history.

        And the bottom 90%…well, most seem to be asleep, for the moment.

        Also…perhaps it was accidental, but your use of the term “spell” is precisely correct. Or perhaps is it a “curse.”

        • RedLogix 19.1.1.1
          12 March 2014 at 8:57 am

          heh – we may have both been reading too much JMG. 🙂

          But yes. I wasn’t imagining the a change at the top 0.001%. In all of human history has that ever happened? (I’d be interested if anyone would care to expand on this.)

          Nor is the rest of humanity exactly asleep. But given this nightmare cannot last forever, you really have to imagine the meek will indeed finish up inheriting what is left of the earth.

  20. aerobubble 20
    12 March 2014 at 10:01 am

    The country was booming under Clark, the reserve bank was so moved that it raised interest rates to curtail the housing bubble. Key went to the election with tax cuts, nobody dared inform the public that tax cuts stimulate the economy. Then shock of shockers the bottom falls out of the global banking industry, and a tax cut saves upper middle classes from a bath. Of course Key is king in many eyes, a politician that got lucky, its impressive how little Key knows.

    So of course after locking in the tax reductions to the upper middle class and businesses (mostly fast food), the great recession looks like coming up for a short breather, yet now debt is out of control, Key has failed to act and raise taxes. Never let it be said that a stupid banker would waste a recession, but Key has, the consumers have gone back to slap happy credit debt, housing is agian making them feel freer with their spending. Oops.

    Yet now the countries books is in far worse condition, and China is already over due a sneeze. The global debt crisis has not be dealt with, except to get accountants to shift the numbers around the books.

    Reasons why Key is a moron, question time yesterday…

    Key says because energy prices were rising fast under Clark, a booming, high interest rates, economy, that the slight slowing during a recession, when power use is shrinking!! that it must be Labours fault.

    Key says that because interest rates under Labour got so high, and he know reserve bank is independent, then Labour is responsible for the last five years of Key government doing nothing about housing.

    And why did Key continue the insulation program, well its raise the value of homes, lowers the value of power shares sell off, was a Green initiative, and slowing the demand for new building.

    Key’s only got such high polls because he got lucky his tax cuts would of bust the housing bubble.

  21. captain hook 21
    12 March 2014 at 1:57 pm

    the problem is as outlined by winny this morning on Radio NZ. The NZLP allowed itself to be browbeaten by the nats in the house and there was no one in the Labour Party caucus versed in macro economics and with enough knowledge to take the tories head on. Our MP’s are good with local issues but its time to get someone with the smarts to rip into the looters and pork barrelers.

    • Tracey 21.1
      12 March 2014 at 2:08 pm

      Anytime any nat mentions average wages opposition mps should start saying

      Cos of the anz banks ceo’s quarter of a million buck bonus… but half of kiwis earn less than 22 bucks an hour.

      I dont know what the anz ceo bonus was, if any

  22. aerobubble 22
    12 March 2014 at 5:10 pm

    Key raised GST, and done nothing about high dollar, now tax revenues are down as consumers avoid GST on online purchases; and guess what, those who spend most of their low income on foods and basics now have to pay more!!!! And worse, because the high dollar does not impact on nz made, the poorest don’t get any benefit from the high dollar, yet National aren;t above making the comparison that we have the highest comparable minimum wage. Of course its looks high, our dollar is higher. So its like kicking someon in the guts while telling them it should feel great.