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New Zealand believes Labour are better economic managers than National

Written By: - Date published: 7:51 am, July 28th, 2020 - 51 comments
Categories: business, capitalism, jacinda ardern, Judith Collins, labour, national, paul goldsmith, same old national - Tags:

I was astounded when Labour scored 61% in this week’s Newshub Reid Research poll.  But that astonishment was dwarfed by this result:

Neale is right.  There is this constant rule throughout English speaking western democracies.  The electorate always believes that tories are better with the economy.  Apparently being a cheerleader for capitalism is better than being a critical manager but this is as solid a political rule as Judith Collins will engage in dirty politics.

For the first time in Aotearoa New Zealand this mantra is in tatters.

It is not hard to see why.  Not only has the Government kept us safe, so far from Covid, but its quick targeted response has protected many jobs and kept many businesses afloat.

National’s response so far is to propose more roads, many more roads.  And Paora Goldsmith has this utterly bonkers desire to slash spending to get debt to GDP under 30% within the next decade, if in power.

From Thomas Coughlan at Stuff:

National’s draft debt target would require it to slash government borrowing by $80 billion leading to what could be some of the harshest public service cuts seen in New Zealand history.

National finance spokesman Paul Goldsmith last week told a gathering of financial sector professionals that his party wanted to get net core Crown debt, the main way of measuring public debt, to below 30 per cent of GDP within a decade.

“Our sense is we need to demonstrate a path back below 30 per cent, in the first instance, within a decade, give or take a few years,” he said.

“It is difficult, given the extent of the global uncertainty, to plot an exact path right now. But we would commit to setting that out clearly in our first budget.”

This time last election Labour had a fully costed and worked through alternative budget.  All that I have heard from National recently is crickets, and roads.

At a policy level I am not surprised that the population trust Labour more than National with the economy.  But this is an unprecedented event and is why National has no chance of winning this election.

51 comments on “New Zealand believes Labour are better economic managers than National ”

  1. Devo 1

    The interview they had on Newshub was hilarious and sad (at 1:49):

    Q: That's kind of your only line isn't it, that you can run the economy better?

    (Goldsmith enthusiastically agrees!)

    Poor guy is out of his depth

  2. Muttonbird 2

    I get the feeling most of National's front bench and certainly the rest of the caucus are terrified of Collins' rule. She'll be trying to micro-manage but she's distracted right now trying to dig up dirt and land hits on the PM. Her colleagues will be too afraid to speak let alone develop anything resembling policy or vision.

    They look in complete disarray.

    National will be pinning their hopes on fake Facebook ads and Topham Guerin’s ‘Love, actually’ videos.

    • ScottGN 2.1

      Collins all consuming preoccupation with the PM, the insinuations and sly digs, the so-called fighting talk is going to be her downfall. The country is just not listening to any of that. Meanwhile she hasn’t articulated anything that her ministry would do to her us out of the shitfight covid has put us in. If she keeps this up the defeat will be historic.

  3. mac1 3

    The German army had a military tactic called 'schwerpunkt' where you defeated the enemy by attacking at their strongest point in the centre, surprising them- whereupon they capitulated.

    National has done this to itself by failing to demonstrate competency in its strongest bastion. "If all else fails retreat to the bastion of belief in financial superiority.' Those walls have been broached, internally, by poor leadership and tactics, dissension and poor morale, desertion, self-protection, lack of discipline, training, quality selection of its troops, disastrous promotion of the under-qualified…………

    The trumpets are sounding, Jericho has fallen.

    • The schwerpunkt was not about attacking at the enemy's strongest point, – that would be madness. It was about identifying a weak point in the enemy's line and concentrating overwhelming effort at that point.

      I agree that National is in disarray though and doubt whether it is capable of directing a focused effort anywhere.

      • mac1 3.1.1

        Thanks, David Smith, for correcting me on that- an obvious misreading of mine from probably fifty years ago. Never too late, eh?

  4. Hunter Thompson II 4

    I have the impression many people thought that because John Key had made all that money on Wall Street, he could "fix the economy".

    It's strange that he never did it when he had the chance.

    By the way, does anyone remember the Porter Project from 1991? No, neither did I. The report sank without trace after costing taxpayers $1.5 million.

    • Dennis Frank 4.1

      Yeah, I was sceptical at the time & dismissed it as capitalist hoopla. However I did eventually get the gist: Porter's thesis was all about the comparative advantage of nations. So play to your economic strengths.

      Not quite worth $1.5 million in view of the fact that nations had always done so. But politicians always need economists to point them in the right direction, so Bolger & co would have been relieved of the task of having to pretend to think for themselves.

    • Chris 4.2

      A very initial on the face of it glance the perception is that national should be better at managing the economy because they traditionally represent wealth and big business. But it doesn't take long after realising whose interests right wing politics serve to know that of course it's left wing governments that should logically manage the economy better because left wing governments traditionally (and generally) serve the interests of citizens. History also supports this.

      It's good to see the shift show up in the poll. Now we need to cement in the reasoning to avoid this being an aberation or something peculiar to post-covid or the PM's popularity so that when things settle down we're not all back to thinking the nats do finance better than Labour. The thinking needs to be accepted as common sense and how things are.

    • Rockin Robin 4.3

      Key did fix the economy – for himself and his mates!

      [Please stick to one user name. You have now been approved as a new user on this site and your comments will appear under this user name without triggering Auto-Moderation – Incognito]

      • Incognito 4.3.1

        [Please stick to one user name. You have now been approved as a new user on this site and your comments will appear under this user name without triggering Auto-Moderation – Incognito]

  5. Dennis Frank 5

    Cool that the left hand puppet is the new people's choice, eh? The right hand has been favoured too long & ambidextrous is good. As regards supervision of the economy, check out who has that duty here: https://www.rbnz.govt.nz/about-us/monetary-policy-committee

    The Monetary Policy Committee (MPC) is responsible for formulating monetary policy in New Zealand, directed towards the economic objectives of:

    • achieving and maintaining stability in the general level of prices over the medium term; and
    • supporting maximum sustainable employment.

    The MPC is subject to the remit for the MPC and the MPC charter, and members must also follow the code of conduct.

    Michael Reddell wrote about it a year ago: https://croakingcassandra.com/2019/07/29/mpc-appointments-prioritising-sex-over-expertise/

    He has the insider's view, of course. Here's his current update on that: https://croakingcassandra.com/2020/07/27/empty-vessels/

    You’ll recall that the Governor and Minister got together to blackball anyone with current monetary policy or macro expertise from serving on the MPC. That gap is really starting to show up now.

    As an outsider, I advise waiting until the recession bites. Could actually be good to have non-economists in charge, eh? The luminaries selected will get their chance to shine through the incoming economic crisis. Are they up for that? Labour's lustre depends on them rising to the challenge!

    • Tricledrown 5.1

      Dennis Frank picking one minor issue from a blog .

      Reddell complains more about Nationals policies such as poor productivity and having high immigration he is highly critical of Nationals reliance on immigration driving down productivity and wage growth.

  6. Ad 6

    This first term was a honeymoon (believe it or not).

    This next term is two babies and a mortgagee sale.

    They better be ready .

  7. Nic the NZer 7

    Agree, this clearly deserves more scrutiny. First of all the question is who actually believes (apart from Reddell) interest rate adjustments do lead the economy to minimal inflation with maximal employment. If on this basis the government favours monetary over fiscal policy leaving a bunch of unelected technocrats in charge of economic policy is this democratically acceptable.

    Finally, assuming familiarity with the idea of counter-cyclical fiscal policy, in which sense can a side be better economic managers? Over recent decades the governments budget position has mostly been due to what the economy has done to it via automatic stabilizers. At most its been discretionary at the margins so who has been running budget surplus/deficits has had the most to do with the term lengths and overlap with the economic cycle and not economic policy.

    Though it should be clear cutting spending now with an ideal of budget surplus now would be premature (pro cyclical) and likely disasterous choice.

  8. Sans Cle 8

    Running a business is not the same as running a country. Winning at capitalism is not the same as managing public finances. National supporters don't understand this difference…..until perhaps now (hopefully).

    • Just Is 8.1

      "Running a business is not the same as running a country."

      If only the general public were able to recognize the subtle difference.

      Statistically, Labour has a far better History of Economic Management

      Probably the best in my lifetime was from Micheal Cullen

    • Kiwijoker 8.2

      Goldsmith certainly doesn’t!

    • Chris 8.3

      A lot on the left don't understand it either and still defer to the idea that the nats are better at finance. We need to destroy the misconception around this and change the climate of opinion once and for all. The facts speaking for themselves is one thing, but changing common beliefs is another.

  9. Observer Tokoroa 9

    Hard Workers – ah no

    Not many will know that Sir John Key, while doing strange things to blonde kids, also set to work to raise the awesome poverty of our beautiful, beloved National beings (sarc).

    To ease the extensive Housing problems of Aotearoa, Sir John Key built one House. It took nine years.

    To ease the galloping Housing problems which flooded the nation, Sir Billy English and dear Paula Bennet, sold off the Government homes. Right under the relaxed nose of Prime Minister – John Key.

    To say that the skills of Sir John Key, Sir Jim Bolger, Sir Billy English, and Ms Paula Bennet were and are adequate – is to distort Truth Itself.

    Every time the Wealthy defend their Wealth, they destroy the real Citizens of our New Zealand.

  10. greywarshark 10

    Here's a fight to show that Labour are better planners, more responsive to the needs of citizens and business, and more responsible than 'Make-hay-while-the-sun-shines, and burn off everything that the land and other people need to get max profit, National'. This pumped hydrolake scheme has been studied thoroughly and seems to meet all the requirements that would be placed on it by thoughtful government, (which wouldn't be National). It is capable of becoming another World Heritage spot I would think, with permanent employment for environmental guardians.

    https://www.rnz.co.nz/news/national/422060/pumped-hydro-may-result-in-biggest-infrastructure-project-since-the-1980s

    I would suggest that the present government get behind this scheme 'toot sweet'. People attuned to the economy, and our present problems and future needs and able to act in a vital, intelligent and effective manner would make it a priority to quickly get onto this, read reports, consult for hidden problems, discuss all with the scientists and informed professionals. Then I would expect a quick decision of 'Yes' if the situation as voiced on Radionz this morning gives a fair summation of the worth of this new type of hydro scheme. (And for the laggers and timorous – it appears that Austral;ia is doing this already.) This is no time to follow normal neolib bureaucracy which actually is industry-driven and hesitates to do anything till it hears the okay from the business sector that they will gain profit from it – without it harming their present profits!

    But it would also mean employment in its building for the Tiwai smelter employees when it closes. They could live in a village like Twizel was and go home every fortnight for a time, or even share jobs with one person being on the work site for a month, then being home for a month, and be replaced by the work buddy. This would spread the work around and keep the unemployment affect down for all the workers. They might do casual work while at home, and tend a community garden. Some imaginative ideas, and the deterioration of morale because of unemployment would be curbed.

    But: https://www.rnz.co.nz/news/national/422165/industry-figures-say-lake-onslow-hydro-project-not-worth-it

    • Matiri 10.1

      or Tiwai employees could live in Roxburgh which is only 2 hours to Invercargill – could go home at weekends.

    • greywarshark 10.2

      I don't think I put the link to this mornings discussion with scientist – the one I put is dated 26/7 so here is today's 28/7

      https://www.rnz.co.nz/national/programmes/ninetonoon/audio/2018756855/lake-onslow-hydro-project-pros-and-cons

      I didn't know what distances would be involved. The ability to go home at weekends would be good. To ensure that minimum carbon footprint went in and that everyone was on site when they should be, work buses could provide transport. The people at home would have the car then for local use, family use. Would be a good idea all round I think.

    • Gabby 10.3

      The chances of it, or any scheme, reducing electricity prices are nil to zilch.

    • infused 10.4

      Most economics/engineers think this project is fucking stupid.

      [Please provide a link to support that assertion or withdraw, thanks – Incognito]

      [No response, which means that you cannot back up your assertion. We’ll see you again on Monday Troll Day – Incognito]

      • Incognito 10.4.1

        See my Moderation note @ 12:26 PM.

      • RobbieWgtn 10.4.2

        @Infused Based on the aggregate conventional wisdom of economists & the engineers I've employed over the last 30 years that probably means it should be looked at seriously.

      • Incognito 10.4.3

        See my second Moderation note @ 12:26 PM.

  11. AB 11

    It would be interesting to know what the poll respondents believe the characteristics of a well-run economy actually are. There's a much more interesting survey to be done right there.

    But yeah – great to see Nat propaganda about their superior economic management is failing at the moment.

  12. cathy-o 12

    whoever was the bright spark who invented GDP shoulda been mercifully eliminated at birth

    • Craig H 12.1

      GDP is a metric, just one of many to choose from. Not the inventor's fault that managerialism led to focusing on it as a KPI without any thought as to other options.

  13. Brian Tregaskin 13

    A good question to ask is what actual business experience has Nationals shadow cabinet got compared to Labours ?

    Answer:-The two teams are pretty much even so that throws out the window Nationals claim we have actual real world business experience in our team compared to the other team.

    IMHO Paul Goldsmith is unproven as a Finance Minster –he could turn out great or a disaster for NZ –who knows, do we really want to find out?

  14. infused 14

    We've had very little visability if the impact of lockdown. When you had out free money, of course people are going to think you are doing great.

    Come next year I imagine people will be singing a different tune.

    The pain hasn't even begun.

    • AB 14.1

      This is the real world – you don't get to escape pain. In this instance you can choose economic pain with a juicy dollop of death and disease on top (where most of the world is headed), or just economic pain on its own (which is what we have done to date). Other options are off the table, i.e. you can't avoid both, and you can't choose death and disease while having a great economy, because death and disease terrify everyone, makes them stay at home and the economy tanks anyway.
      If you can’t avoid pain, well-functioning societies share and soften it.

      • new view 14.1.1

        AB . I like your comments, they make sense.. Especially the last seven words. Sharing the pain means either tax increases and or sharing the debt with our grandchildren, which heavy borrowing will ensure. It doesn't matter who wins this election, those feeling the pain the most will end up most likely hating the Government of the day. even those from the left. Maybe Mickey S should wait until this time next year before talking up the financial attributes of this coalition.

      • Grafton Gully 14.1.2

        "If you can't avoid pain, well functioning societies share and soften it" – by voting “yes” to ACT's End of Life Choice Act.

  15. This Government is winning hearts and minds through genuine efforts to deal with problems in an orderly sustainable way. Sustainable is accepted culture now.

    Labour should list all the things Labour Govts have produced over the years, with genuine reference to NOT allowing false dichotomies such as Roger Douglas ideas to be introduced, and what is in place to protect against that occurring again.

    Trust has to be won, and can not be achieved through arrogance and a "Born to rule" mentality which Judith Collins displayed when she said "We will take the country back" "We will crush them' (this government)

    This, coupled with talk of bubbles to allow foreign students in, made many nervous.

    The public has grasped that no community transmission of covid, underpins fiscal safety.

    Ballooning health costs and lock downs elsewhere cause budget blow outs not aimed at jobs. Here NZ is concentrating on how to help dislocated workers, improve surviving industry business and trade.

    People are putting schemes through a modern sustainability lens. They appear to have grasped targeted assistance, and accepted higher debt to GDP levels and the time frames involved.

    Humans are stronger together, so villages and communities are gaining credence again, and individualism is seen as selfish in the face of covid. "Kiwis are helping Kiwis."

    We need to watch the effects of our fear, as returnees have often had real trauma to deal with, which we have mainly been spared, so we should remain helpful and tolerant as their return journeys have involved lock downs cancellations visa and passport renewals isolation and all the worries that go with huge change.

    We should keep listening to the scientists and our leaders. They are doing well.

    • Grafton Gully 15.1

      "Humans are stronger together”. You are on a desert island with someone who is inconsolable, spends the days and nights in terror and does nothing to support either of you. Would you be stronger alone ?

  16. Weasel 16

    Judith Collins increases the huge trust gap between her and Jacinda as revealed in the Reid Research poll when she was caught out with her porky that no prisoners escaped when she was Corrections Minister:

    https://www.stuff.co.nz/national/politics/300067642/election-2020-judith-collins-says-she-was-joking-when-falsely-saying-no-one-escaped-while-she-was-corrections-minister

    Official figures show that 11 people escaped in the 2008/09 year, nine in the 2009/10 year, and four in the 2010/11 year. Asked on her way into caucus on Tuesday why she had stated that no one escaped when people clearly had, Collins said “there was the odd one that might have popped out, but they all got caught” and then said it was a joke.

  17. Stuart Munro 17

    That belief, based pretty much on Muldoon actually having learned a couple of things about economics – unheard of in his party in those days – has been perpetuated long after even the vaguest hint of economic competence had expired.

    Marx was right about one thing, and that is that economics is a major element of the political battlefield. The lazy incompetence of the Right was, in New Zealand, typically mirrored on the Left by an irresponsible reliance on a bastardised version of Keynesianism that Keynes would have disassociated himself from pdq.

    For the past fifty years NZ has produced better economic rhetoric than economic results. Our economists are the kind of charlatans who, in the company of mathematicians pretend to be philosophers, and in the company of philosophers pretend to be mathematicians. And as a result the path we take is not that of rational economic development, much less sustainable or enlightened development.

    The handling of Covid here and abroad is a benchmark for international governance it seems: citizens are to be pathetically grateful that government didn't irresponsibly kill most of us. Most other countries are doing exactly that. Building a better society has apparently been off the table since Rogergnomics.

    • greywarshark 17.1

      Stuart Good to see you regularly now. I am keeping this little gem of yours for occasional reference when I need some ironic laughter about 'da system'.

  18. Richard@Down South 18

    Bob Jones said a few years ago he personally does better when National are in power (more opportunity to snatch up an investment) but said the economy in general does better under Labour

  19. Weasel 19

    According to Pattrick Smellie on BusinessDesk, on the Reid Research poll, not one National MP would get into parliament, including Paola Goldsmith. Can someone explain then why would Goldsmith cede Epsom to ACT, especially given if ACT gets ~3% of the vote but don't win Epsom, then National might then get one list MP?

  20. National has always been an arranged marriage between landed property owners and and bank funded townies. They have a common objective. Keep non capitalists, and non farmers out of wealth accumulation. The wealth deprived are not worth considering.

    That is what economists promulgate. They have the nerve to let the chattering classes to call them "experts". Sigh.

    It is long overdue that we all grew up. Especially the the shareholders organisation and the so called "tax payers union", I am not holding my breath. Sigh.

  21. Draco T Bastard 21

    The electorate always believes that tories are better with the economy.

    And its always been a fictitious belief fed by the lies in the MSM.

    Conservatives are always the worst possible economic managers because all they care about is making themselves, and others of like mind, richer. They simply don't care about anybody else or the economy.

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    1 week ago
  • Speech to the New Zealand Nurses Organisation Conference 2021
    Kia Ora tatau katoa.   Ka tuku mihi ki nga nēhi, He pou Hauora o Aotearoa, E ora ai tatou.   Whakatau mai  I runga i te kaupapa o te ra Te NZNO conference.   Tena koutou tena koutou Tena tatou katoa   Good morning, and thank you inviting me ...
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    1 week ago
  • Government investment in farmer-led catchment groups sweeps past 150 mark
    171 catchment groups have now been invested in by the Government 31 catchment groups in the Lower North Island are receiving new support More than 5,000 farmers are focussed on restoring freshwater within a generation through involvement in catchment groups  Government investment in on-the-ground efforts by farmers to improve land ...
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    1 week ago
  • Fight to protect kauri on track
    The Government is pitching in to help vital work to protect nationally significant kauri forests in Auckland, Minister of Conservation Kiri Allan says. “Ensuring the survival of these iconic trees for future generations means doing everything we can to prevent the potential spread of kauri dieback disease,” Kiri Allan said. ...
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    1 week ago
  • Joint statement of Mr Bernard Monk; Hon Andrew Little, Minister Responsible for Pike River Re-entry,...
    [Note: The Parties have agreed on terms to fully and finally settle the proceeding and will jointly issue the below statement.] At the heart of this litigation are the lives of the 29 men tragically lost at the Pike River mine on 19 November 2010 and to whom we pay ...
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    1 week ago
  • More financial support for businesses
    Today’s decision to keep Auckland in a higher COVID Alert Level triggers a third round of the Wage Subsidy Scheme which will open for applications at 9am this Friday. “The revenue test period for this payment will be the 14th to the 27th of September. A reminder that this is ...
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    1 week ago
  • Aotearoa New Zealand provides further humanitarian support for Afghanistan
    Aotearoa New Zealand is providing a further $3 million in humanitarian assistance in Afghanistan, Foreign Minister Nanaia Mahuta announced today.  “There is significant humanitarian need in Afghanistan, with the crisis disproportionately affecting women and girls,” said Nanaia Mahuta. The UN has estimated that 80% of the quarter of a million ...
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    1 week ago
  • Innovative te reo prediction tool announced in Te Wiki o Te Reo Māori
    A new Māori language prediction tool will play a key role in tracking our te reo Māori revitalisation efforts, Minister for Māori Development Willie Jackson announced today. He Ara Poutama mō te reo Māori (He Ara Poutama) can forecast the number of conversational and fluent speakers of te reo Māori ...
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    1 week ago
  • Further Government support for people to access food and essential items
    The Government is responding to need for support in Auckland and has committed a further $10 million to help people access ongoing food and other essential items, Minister for Social Development Carmel Sepuloni announced today. This latest tranche is targeted at the Auckland region, helping providers and organisations to distribute ...
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    1 week ago
  • Half a million Pfizer vaccines from Denmark
    The Government has secured an extra half a million doses of Pfizer COVID-19 vaccines from Denmark that will start arriving in New Zealand within days, Prime Minister Jacinda Ardern announced today. “This is the second and larger agreement the Government has entered into to purchase additional vaccines to meet the ...
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    1 week ago
  • Inland Revenue providing essential COVID support for businesses
    Inland Revenue is seeing increased demand for Resurgence Support Payments and other assistance schemes that it administers, but is processing applications quickly, Revenue Minister David Parker said today. David Parker said the Resurgence Support Payment, the Small Business Cashflow (loan) Scheme and the Wage Subsidy are available at the same ...
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    2 weeks ago
  • New Zealand marks 20th anniversary of 9/11 attacks
    New Zealand is expressing unity with all victims, families and loved ones affected by the September 11 2001 terrorist attacks, and all terrorist attacks around the world since, including in New Zealand. “Saturday marks twenty years since the 9/11 terrorist attacks in the United States, which killed nearly 3,000 people ...
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    2 weeks ago
  • Speech to SPREP Environment Ministers
    Talofa Honourable Ulu of Tokelau Faipule Kelihiano Kalolo Tēnā koutou katoa and warm Pacific greetings from Aotearoa to your excellencies, ladies and gentlemen. The new science released by the Intergovernmental Panel on Climate Change on 8 August paints an alarming picture of the projected impacts of climate change on the ...
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    2 weeks ago
  • Additional Resurgence Support Payments to support business
    Businesses affected by higher Alert Levels will be able to apply for further Resurgence Support Payments (RSP). “The Government’s RSP was initially intended as a one-off payment to help businesses with their fixed costs, such as rent. Ministers have agreed to provide additional payments to recognise the effects of an ...
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    2 weeks ago
  • More Dawn Raids scholarships announced
    Details of the ‘Manaaki New Zealand Short Term Training Scholarships’, a goodwill gesture that follows the Government’s apology for the Dawn Raids of the 1970s, were released today by Pacific Peoples Minister Aupito William Sio. “These scholarships that are targeted to the Pacific will support the kaupapa of the Dawn Raids’ ...
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    2 weeks ago
  • One-way quarantine-free travel for RSE workers starting in October
      One-way quarantine-free travel for Recognised Seasonal Employer (RSE) workers from Samoa, Tonga and Vanuatu starts in October New requirement for RSE workers to have received their first vaccination pre-departure, undertake Day 0 and Day 5 tests, and complete a self-isolation period of seven days, pending a negative Day 5 ...
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    2 weeks ago
  • Govt boosts Pacific suicide prevention support
    Applications have opened for the Pacific Suicide Prevention Community Fund as the Government acts to boost support amid the COVID delta outbreak. “We know strong and connected families and communities are the most important protective factor against suicide and this $900,000 fund will help to support this work,” Health Minister ...
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    2 weeks ago