Some thoughts on how to get the economy moving again while also shifting us away from the failed banking system that we’ve been using for the last few centuries.
What could the government do for the economy if?
Ok, we all know that there’s a housing shortage and that the government needs to build more state housing. My suggestion has always been that the state builds this housing and rents it out at 25% of household income but, as the people aren’t actually buying the house, it really shouldn’t be that high. All we really need would be about 10% adjusted on if it’s an apartment for a single/couple or a three bedroom residence to cover maintenance (normal wear and tear, anything above that gets charged to the people living there at extortionate rates). Unfortunately such low rents are likely to encourage resentment from some people and bring about another round of beneficiary bashing neither of which we want.
We also have a problem of a high dollar which is being pushed up because seemingly we’re the only country in the world that isn’t engaging in Beggar Thy Neighbour quantitative easing (otherwise known as printing money). Don Brash, of course, thinks nothing can be done about this and that doing so “which of course really means cutting the real wages of New Zealand workers”. The point that Mr Brash seems to miss is the fact that we can’t actually afford such a high dollar as all our money goes outwards and, due to exports being constrained by the high dollar, very little is coming back in. This trade imbalance is also exacerbated by foreign ownership which channels profits offshore.
So the suggestion is that the government goes out and builds houses and apartment buildings with printed money and rents them out at low rates. On top of that it also offers to buy peoples houses and rent them back to the ex-owner for the same low rentals. I figure this will have numerous effects:
Further to that, once the government owns these houses it then behoves the government to get them up to standard so that means installation of insulation and, at a later date, solar panels (both electrical and water) as well. This will create more work and save the country in terms of power along with the house building that the government will be engaging in will give a huge boost to our construction industry – possibly to the point that proper fully automated factories will need to be built to support it which opens up more export potential.
This isn’t a full list of what the government could do if it was serious about creating jobs and eliminating poverty. There is a hell of a lot more it could, and should, do to boost NZ’s flagging economy and society. We know, after three decades of experimenting, that leaving it to a few rich people doesn’t bring about the dynamism that is needed to maintain a just and equitable society.
Draco T Bastard