A better than usual interview of John Key by Guyon Espiner on Sunday’s Q+A. On the plus side Espiner was raising some serious issues. On the minus he let Key get away with his usual lies and evasions.
GUYON So you’re still expecting 170,000 jobs over four years and back in surplus by 2014/2015?
JOHN We’ve got no reason to back away from that.
And we’ve got no reason to believe in it. The same 170,000 jobs were predicted in the last budget too, it’s just a cut and paste.
GUYON Let’s talk about the domestic economy. You said when you opened Parliament for the year in February, and I quote you, ‘The government is conscious that for most New Zealanders, an indicator of how well the economy is doing is whether or not they can keep up with the cost of living.’ Do you seriously think they are?
JOHN Well, I do. I mean, if one goes and has a look at things like the Food Price Index and the like, yes, it has risen, but it’s not the craziest moves we’ve ever seen. Um, there’s quite a lot of fluctuation in there.
Inflation is at a 21 year high of 5.3%. Wage growth is less than half the rate of inflation, in fact is at its slowest rate for 15 years (and no you can’t tax cut your way to higher wages). Even The Herald is asking If it’s boom why are so many feeling bust? Espiner did follow up on the matter of inflation:
GUYON But you promised also to, and I quote you again, ‘maintain a low level of inflation’ in that opening speech to Parliament at the start of the year. You’ve failed. 5.3%. Highest in 21 years. It’s a failure.
JOHN No, well, I don’t accept that either. You’ve got to go and look at the data. The 5.3% includes a 2.2% uptick for the one-off adjustment of, um, GST increase. Now, everyone knew that, so if you take that out&
GUYON But that’s real. This is not some technical discussion, is it? If you’re sitting at home and your food bill’s gone up because of GST, then you feel that.
JOHN Yes, but, I mean, you’ve got to look at two things. [… blah blah blah …] actually, wages have gone up in terms of after-tax wages because of the tax cut. That’s what’s driving that. So it’s not in isolation. People have more money in their hand, and they pay slightly more for their goods because of GST.
After tax cuts and GST increases, folk on the average income got around five dollars a week, those on the average salary around ten dollars a week. A drop in the bucket compared to the (non GST) inflation. In fact, it’s only around $80,000 of income that you start to break even. On then to the wage gap with Australia:
GUYON One of the key indicators of wages, one of the key ones that your government set was catching up to Australian incomes. Are you making any progress in that regard?
JOHN I think we are. Um, you know, we’re three years into what’s been a 40-year decline against Australia. But in real after-tax terms, we think we have narrowed the gap with Australia.
Ahh – no. The wage gap with Australia is wider, according to figures reviewed by the Dominion Post, and the CTU – oh, and the government’s own figures. (Hardly a surprise as the government is doing nothing at all to close the gap.) Key has been called on this lie by any number of commentators, but as you can see, he’s still telling it. (When he’s not talking up the wage gap as a “competitive advantage” that is.)
Espiner then asks some good questions on poverty – Key reckons its all down to “poor choices” – before moving on the rich-poor gap:
GUYON Yet the rich got richer.
JOHN Well, actually, I don’t know. Is that right?
GUYON It must be. When you cut the tax rate from 38% to 33% and you’re earning $200,000, $300,000, $400,000 a year, of course you got richer. That’s a choice that you made.
JOHN Actually that’s not technically right. …
WTF? Key’s excuse seems to be that the rich spend the money and pay GST, and there were also some property tax changes, so it was all a wash. Or perhaps he’s still quoting this discredited report, which didn’t take account of last years tax bonanza for the rich.
Back in the real world that tax bonanza gave $2.5 billion a year to the top 10 per cent of earners while the bottom 20% got practically nothing, wages are falling for the poor and rising for the rich, average and median wages have diverged by 12% (because the rich are getting richer the poorest half of NZ is $80 a week worse off), child poverty and other indicators are getting worse, the concentration of wealth is increasing, and the 150 people on the “rich list” have increased their wealth by 20% in the last year. Key should just stick with his original instinct and tell the ordinary folk not to get jealous.
The interview then moves on to discuss child poverty (more on that in another post soon perhaps).
So there you have it, some real issues raised for a change. But when Key is put on the spot his responses are nothing but evasions and recycled lies (that don’t get any truer for the frequent repetition). It’s pretty hard to defend a terrible record of course, but the country deserves so much better than this.