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No, he meant “infrastructure”, he really, really did

Written By: - Date published: 3:47 pm, March 7th, 2008 - 27 comments
Categories: national, spin - Tags: ,

AYB’s confidence in English as a frontman for National may already have taken a knock as the second half of the dynamic duo has successfully managed his own John Key moment within hours of taking over the reins.

When asked on NewstalkZB today whether National would borrow money to pay for tax cuts English managed this:

We’ve always said we have a credible programme of tax cuts which we phase in to match macroeconomic conditions. Ah, we’ve always said, we aren’t that worried about, um, whether the Crown needs to borrow a bit of money.

Got that? National will borrow money to pay for tax cuts. I don’t think I need to spell out the problems with this plan.

And it seems English’s spindoctors really didn’t want it spelled out. Within minutes of English finishing the interview they were claiming he was talking about “infrastructure” not tax cuts and franticly pleading with Newztalk political editor Barry Soper to drop the interview.

I’ve gotta say, there’s a pattern starting to form here. As I recall APN has a pretty big stake in Newztalk’s parent company, The Radio Network, perhaps someone could make another call to the CEO and get a “correction”.

Update: Sources close to English say he meant Australian tax cuts.

Update to the update: and that he was joking.

Update to the updated update: or that he never said it.

27 comments on “No, he meant “infrastructure”, he really, really did ”

  1. Patrick 1

    They are trying so hard to hide their policy, it’s so painful watching it slowly drip out under their own incompetence.

  2. Horisthebear 2

    Ah shock announcement IrishBill…technically Cullen is going to do the same…don’t believe me then look at the forecast Government bond tender programme it has borrowing continuing and fresh lending forecast. It makes a mockery of Cullens comments for his 4 conditions to convienently hide behind.

    More the issue is what the cash from the funds borrowed go to and whether it is better for the Govt to borrow the funds and pay for it via taxes or someone else to do it instead. If it borrowed to invest in real productive assets that is one thing but if it is on wasted social programmes or to buy $500m of dumb things that is stupid eg. investing in badly run trains (there is not a single govt in the world that runs train networks efficiently). I’ve worked for three Govts in three different countries on related issues.

  3. IrishBill 3

    Horis, I’m not shocked at all by the statement and never said I was. Perhaps you should try another strawman argument. This post is not about borrowing for tax cuts (I couldn’t be arsed going into the detail of why it is a bad idea, after all it is Friday arvo). The post is about Bill English letting out policy he knows won’t be liked and then trying to claw it back in.

    Note: this post is tagged as “National” and “Spin” because it’s about National’s highly tuned (and expensive) spin machine failing.

  4. Sam Dixon 4

    HoristheBear- As old bonds expire, new bonds are issued.

    The Government always issues some debt; sovereign debt is an important part of a functioning financial market. The Labour government brought down gross debt from 30% first to a target of 25%, then 20%. Now gross debt is below that 20% target.

    So, yes, any government will always be issuing new debt to keep debt levels where they want them, but that’s something entirely different from borrowing (ie increasing debt) to fund tax cuts.

    captcha: losses assumed

  5. To be fair, he said it depended on cyclical conditions, which is a fair argument for ‘temporary’ borrowing. The correct level of taxation runs surpluses when the country is growing above its long run rate and deficit when it is growing below its long run rate.

    If tax cuts need to be introduced (as both National and Labour have said they should be), and we are moving into a cyclical downturn in the economy, it seems fair that the government will have to borrow money to pay for the tax cuts. As long as they can pay back the money when the economy expands we are away laughing.

  6. Steve Pierson 6

    National is talking about increasing debt to pay for tax cuts. That’s stupid. It’s like talking out a loan to buy the groceries, you just have to take out another loan next week, and the one after.

    debt levels should be held at the low levels they are now at. The only reason to raise them would be to fund investment, something that is going to result in a return on the cost of borrowing.

  7. IrishBill 7

    For crying out loud. The post isn’t about tax cuts but about political (mis)management. Please, try to stay on thread.

  8. Ari 8

    I would’ve thought that the actual undesirability of the comment goes hand in hand with whether it was political mismanagement, personally.

  9. Steve Pierson 9

    Sorry, Irish. Please don’t beat me.

    Yup, that’s a week of shoddy politics by National. They forgot the first rule of being Tories – don’t never tell your plans to people who might not like to hear it, save those comments for meetings with business people and the vague nice stuff for the public. And when you get caught, try to slip out of it.

  10. Boy Wonder gropes feverishly at Bat Utility Belt for Bat Memory Spray, only to find the Caped Crusader has already used up the whole can.

  11. Horisthebear 11

    OK – IrishB point taken. This is common by parties (both have done it). When I worked in Parliament (I worked for one side of the house my wife the other…) it was common to ‘leak’ a story to see how people reacted on a policy idea. What should be done is actually allow both parties to release discussion documents and openly discuss the merits of the policies. Doing by press release is just faster.

  12. higherstandard 12

    Steve if you think the first rule only applies to National you are delusional

  13. IrishBill 13

    Horis, I agree with you about discussion of policies but not about this being a strategic leak. There is no way English would brook the embarrassment of this error just to leak policy, especially when there are dozens of cleaner ways to do it.

  14. indeed IB, many many better ways to do it

  15. infused 15

    There is no problem with borrowing. Labour will have to do it as well. You guys are trying to make a deal of any little thing you can now huh? It’s quite funny to watch. It’s like you’re sitting there with your eyes held open.

    captcha: newsmen right

  16. K Douglas 16

    You would think that the nats would get it right on Tax Cuts (they’ve had 3 years to work on the lines) it’s their only policy.

  17. Dean 17

    “Got that? National will borrow money to pay for tax cuts. I don’t think I need to spell out the problems with this plan.”

    Is that literally all you’ve got besides the lower wages quote? Are you guys reduced to pasting quotes to win your idealogical argument?

    “Yup, that’s a week of shoddy politics by National. They forgot the first rule of being Tories – don’t never tell your plans to people who might not like to hear it, save those comments for meetings with business people and the vague nice stuff for the public.”

    Is that anything like the haters and wreckers or last cab of the rank remarks? Or is it only National leaders that make mistakes?

    I mean, I knew you guys were fans, but you are clearly in the realm of being a sycophant. It’s quite pathetic.

  18. Ari 18

    Infused: There’s no problem with borrowing to support investment. Tax cut is the very opposite of investment, it’s effectively paying out your investors, and borrowing for that sort of thing is incredibly poor fiscal management, and at BEST it’s unsustainable.

  19. David S. 19

    “We would love to see wages drop. The way we want to see wages increase is because productivity is greater. So people can afford more. Not just inflationary reasons, otherwise it’s a bit of a vicious circle as it comes back to you in higher interest rates. We really want to drive that out.’

    It seems to me Key was saying that he thinks wages are too high right now, presumably as a result of minimum wage increases, and that it’s his opinion that increases in wage should come as a result of economic growth instead. So yeah, he wants wages to drop, since they’ve been “artificially” increased, then grow as a result of increases in productivity. An opinion most of the right would probably agree with.

    Of course, that doesn’t cover the whole “I was talking about Australia” BS.

  20. ak 20

    Q: What do you get when you stick a thin slippery mask on a heartless reactionary ideology?

    A: Glimpses:
    “We will borrow to fund tax cuts”, “We will privatise our schools”,”The war is over”, “People can go down the road to the cheaper doctor”, “We would love to see wages drop”, “We’ll abolish the fee cap for doctors”, “We’ll give the meat companies $200mill”, “Climate change is not proven”, “We love the Maori Party but will annihilate it”

    With apologies, I am moved to verse:

    HMS Glimpse:

    Oh what a hideous hulk we see
    behind the brightly painted Quay
    The grinning standard tight concealed
    while Press gangs plough the owners’ fields.
    The widows’ tears of past forgotten
    as Slippery John bestruts the rotten
    planks of woe and horror below:
    simpering slut of king cargo.

    But deep in ancient and caulk and teak
    pernicious nature change doth wreak
    and God’s great hand works soft and true
    to keep His bounty from the Few
    and as of yore His will prevails
    through lesser creations’ travails –
    as worm and rat – (so cruelly hated,
    by armies of tory constipated)
    fulfil their heavenly designation
    (on minimum wage and paltry ration)
    and scuttle the gains of others’ blood –
    fingering dykes won’t stop this flood!

    So watch, dear tories, as history marches on. And be reassured by the fact that those whom you now despise will prevail: for they will have more compassion for your descendants than you ever would have.

    And thus,

  21. higherstandard 21

    Outstanding ak

    I disagree with your ideology but well done.

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