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So! You want a “plan”?

Written By: - Date published: 4:36 pm, March 11th, 2021 - 50 comments
Categories: business, capitalism, cycleway, economy, Economy, employment, Free Trade, jobs, poverty, socialism, tax, wages, welfare - Tags: ,

 

Expecting a bit much aren’t you?

We haven’t had that since Muldoon. There were issues with his plans, but at least he had them.

If the Government “interfered with the” sacred “free market’ the same people asking for a plan would be screaming about “central planning”, “picking winners”, “protectionism” and all the usual BS.

The last few Governments plans, were to bring in lots of cheap labour to give the illusion of economic growth. And, build a cycleway!

Throwing money at the bottom end of town, with wage subsidies, seems to be working rather well.

The irony of the same people who don’t like paying wages, or taxes, asking for Government support when they are in trouble, hasn’t been lost on “central NZ”.

Many of the same types who looked on, or even cheered, when over 200 000 lost jobs during Rogernomics and when Richardson cut welfare in half.

Not that I don’t sympathise with small businesses, who are basically wage earners employing themselves. I know first hand what it is like to lose your business, and home, due to circumstances outside your control.

Tradespeople, and the like, unlike farmers and big business, do not usually get Government handouts when weather, illness or wage/welfare cuts for their customers, put them out of business. This time the wage subsidy has kept many afloat. Often for enough time for the viable to survive.
Of course, employees out of work get SFA, still. Unless it is due to Covid. Then for some reason, they get double the dole.

It is notable that banks and landlords were not expected to come to the party. Some commercial and rental landlords have, to their credit, but it was entirely voluntary.

Continuing to subsidise businesses like mass tourism, oil, Tiwai point and others, that have an uncertain future, just kicks the pain down the road. At some stage we are going to have to develop an economy, that doesn’t depend on destroying the environment, sugar rush booms, and keeping a pool of impoverished desperate unemployed.

Yes. We do need a “plan”, but those demanding one, only want a “plan” that works for them. They would not like the “plan”, that works for everyone’s future.

Strange how many Capitalists, do not really believe in Capitalism.

50 comments on “So! You want a “plan”? ”

  1. Enough is Enough 1

    Throwing money at the bottom end of town, with wage subsidies, seems to be working rather well.

    The irony of the same people who don’t like paying wages, or taxes, asking for Government support when they are in trouble, hasn’t been lost on “central NZ”.

    You really think that's working well?

    The past 12 months has seen the rich get a lot richer, and the poor either stay where they were or go backwards,

    If you are a property owning boss, then yeah, its working out well.

    • KSaysHi 1.1

      There is actually a widening divide between those who can't work full time (people who are unwell) and everyone else.

  2. KJT 2

    Enough is Enough. 5.14.

    With current economic settings, trickle up is inivitable.

    Was happening well before Covid.

    The Government wage subsidies have worked to keep employment up, businesses going and money in communities.

    Shows what could have been.

    • Enough is Enough 2.1

      Trickle up?

      There is no trickle up. Its landing in their laps and they are keeping it.

      Meanwhile at the bottom….

  3. AB 3

    "We do need a “plan”, but those demanding one, only want a “plan” that works for them."

    Yep. I think there's also an element of wanting the government to over-reach itself with its planning and be too specific too far out in time. Then when some things inevitably don't pan out exactly as planned, the government can be blamed for incompetence or 'not meeting targets'. Either that, or the journos and Nats demanding this impossible plan that will deliver an impossible certainty, have never had to do anything particularly difficult in their entire working lives to date.

  4. Ad 4

    What a nonsense piece of factless puffery.

    Labour didn't generate a plan about the vaccine rollout until this week. They should have.

    The Greens are begging in their every media release for greater intervention and greater planned control in every policy field of interest to them – most of all climate change.

    National wants a clear plan about pretty much anything. They generated clear plans for transport and Christchurch that are still being rolled out – they sure endured and made a difference even if we may not agree with them.

    All the major Councils are putting out budgets right now, but few of them can tell you what those plans will mean for ordinary citizens. Even fewer citizens can tell you what their plan is.

    The Combined Trades Unions want a plan from business.

    The larger capitalists have grouped together seeking a whole lot more of a COVID plan than has been released.

    And of course Labour itself has generated plans for many of the affected industries, coupled with handsome subsidies. They need to generate more to each changing societal shift – because that's their job.

    We certainly appear to have a public housing plan, but not an effective one for first home buyers. Minister Roberston was supposed to deliver one weeks ago.

    And of course apart from housing this government has generated policy thought-pieces in education, health, water, local government, tax, tourism, transport and much else that have gone frankly nowhere.

    Everyone wants a plan that works for them, and everyone has every reason to expect one. Plans are core government business. Where are they?

  5. Stuart Munro 5

    It would be nice to see some plans – though not necessarily to provide a basis for a critique of Covid policy, which seems to be National's "plan so cunning you could put a tail on it and call it a weasel", as Baldrick puts it.

    We might start with every kiwi homed, and though it might take twenty years or more, not addressing this major social and economic problem will impoverish and marginalise many, if it is not done, and the cost of that, even to bloodless neoliberal cheeseparers, is on the high side. Get a bit of momentum behind it and even a pack of hosers as worthless as National would not dare to cancel it.

    I still favour the idea of bringing Mike Joy & Dr Death into the freshwater policy, by giving them a catchment each, and funding, and letting them produce prototype interventions. We want our best minds working on practical solutions, do we not? There are plenty of waterways ripe for such initiatives.

    Carbon is going to be a doozy – and EVs and hydrogen aren't going to be a magic bullet.

    Aquaculture should be dwarfing our dairy receipts by now, but of course regressive slave operations don't develop their sectors – that's more entrepreneurs, or small owner operators as they were known before financiers hijacked their image and mostly tanked it.

  6. Jackel 6

    What's your plan? What are your dates, times and metrics? What sort of dumbarses ask leaders dealing with a crisis these sorts of questions? The government have given general information on these things and have been as specific as they can be. Frankly, this is sufficient and the best under the circumstances.

    Ever heard of dirty politics?

    • KJT 6.1

      With Covid the Government has done very well, given the circumstances.

      With an evolving and changing disaster you have to respond to the latest events and the expanding evidence of what works

      They responded better than I expected to the hand they were dealt, with a run down civil service and health system, a civil service with too many Tory bootlickers and too little spent on planning and precautions against disasters. The national stocks of reserve PPE for pandemics is just one example.

      The Neo-liberal, "leave it too the free market" is not serving us well with essential infrastructure, housing, poverty, and the environment. Those who are making lots of money from it, are fighting even small efforts to improve things.

      Tinkering around the edges is not, a "plan".

      National's incoherent changes of direction according to the last focus group, or their own groupthink, it is hard to tell, is also " not a plan". National and their mouth pieces demanding a "plan" is totally hypocritical, when they cannot even decide if borders should be open or shut.

      • Tiger Mountain 6.1.1

        The employing class plan is to milk the state for all they can–COVID be damned–and further penetrate state infrastructure with for profit enterprise, and have as little accountability as possible while doing it.

        One reason it is hard to discern a plan for the working class from this Govt. is because central planning for social good was pretty much discontinued by Rogernomics & Ruthanasia’s relentless focus on Market solutions. Neoliberalism is entrenched in legislation and the Reserve Bank and free in and out flow of capital. Food Safety for example involves multiple ministries and local Govt. It is amazing the COVID response was so effective given the fragmentation of health services and digital incompatibilities etc.

        NZ does need various plans, say a 2, 5, and 10 year 50,000 minimum build state housing plan. A plan for a higher wage economy via Living Wage uptake and Fair Pay Agreements with increased union rights to set national wage floors. But it will take action by NGOs and a restored class left NZCTU, and community organising to get there.

        Labour may still scrape in come 2023, but I hope they don’t and have strong opposition from Green/Māori asking the Boomer successor generations to support all the plans the Labour Caucus would not!

  7. Castro 7

    Pat's plan is an imminent housing rout… LOL

  8. Papa Mike 8

    The Plan should include how, who and when will the printed money be paid back

    • Sabine 8.1

      that is easy, mint the trillion dollar coin and pay it back. We have our own currency and we print it too.

    • KJT 8.2

      Why does it have to be paid back.

      That is the point of "printed money"!

      Not having to pay it back, plus interest to the finance system.

      By the way the money “printed” for State housing in the 50’s was never, on the surface, paid back. But the increased productivity and social benefits more than paid it back.

      Same with the Covid help. Note the tax base hasn’t suffered much because the economy is still moving along, with the help of the Covid support.

  9. Peter 9

    The plan about having rapid rail in Auckland 60+ years ago? We are reaping the rewards of that now.

    "They would not like the “plan”, that works for everyone’s future." They didn't and 'plan' is now 'pain.'

  10. Gosman 10

    When government restricts normal economic activity for extended periods of time then it is beholden on government to look to mitigate the impact of the restrictions. I don't think you would find any person on the right who would disagree with that. You might find people arguing that there should be no restrictions placed in the first place however if these actions are necessary then the government needs to step up and provide a degree of short term support for the outcome of the actions they took.

    • KJT 10.1

      Principles fly out the window when there is "free money" for the right wing.

      Yes. We understand.

      • Gosman 10.1.1

        No. The principles are quite clear and have not been abandoned. If the government causes harm as a result of an action then it is beholden on government to make amends or to mitigate that harm.

        You are conflating pure Libertarianism with all right wing thinking. It would be like me stating that left wingers should not support any private enterprise provision of goods and services.

        • KJT 10.1.1.1

          Covid caused the "harm", not the Government. . The Government is attempting to mitigate it.

          We are all better off because of the lockdowns, than we would have been otherwise, under Covid.

          You only have to look at the UK, USA and Brazil to see that.

          • Gosman 10.1.1.1.1

            No. The harm Covid-19 caused has been minimal in NZ. The harm caused by the government's response to dealing with the potential threat of Covid-19 has been extensive. Most NZers agree this was necessary even people on the right of NZ politics. What right-wingers who support that action of the government want though is that the government acknowledges it's actions have caused economic harm and that it attempts to mitigate this harm through various actions such as providing temporary financial support. There is no throwing out of principles involved in holding these views.

            • froggleblocks 10.1.1.1.1.1

              No. The harm Covid-19 caused has been minimal in NZ. The harm caused by the government's response to dealing with the potential threat of Covid-19 has been extensive.

              Lol.

              As James Shaw said last year: we could choose to have a recession with lots of people dying, or a recession without lots of people dying. We chose the latter.

              You only need to look to the UK and US to see countries that chose recesssions with deaths. Or Australia, for that matter.

              Recession was inevitable. Blaming it on the government is idiotic.

  11. grant not robertson 11

    To Papa Mike:

    To whom does the ‘printed money’ have to be ‘paid back’?

  12. Pat 12

    The bond holders…of course you can choose to default (even partially) if you so decide

    • KJT 12.1

      Government "Printed money" is NOT, borrowed money.

      That is paying someone else outside the Government to "print it".

      • Pat 12.1.1

        Where does that value end up?

        "The purchase of bonds by the Reserve Bank is funded through the electronic creation of money and the crediting of banks’ settlement accounts with the Reserve Bank. The LSAP programme results in the expansion of the Reserve Bank’s balance sheet, with the purchased government bonds showing up as an asset, and the money created to pay for these purchases showing up as a liability through banks’ settlement accounts with the Reserve Bank.[8]"

        https://www.parliament.nz/en/pb/library-research-papers/research-papers/library-research-brief-large-scale-asset-purchase-lsap-programme/

        You can write those bonds off if you are prepared to destroy the settlement accounts of the private banks and freeze the banking system….and then theres the remaining 40% (in our situation , at least shortly) of bond holders who will be looking on wondering if the same fate awaits them.

        Its a one one trip….no central bank has worked out how to unwind QE without crashing the system.

        Google taper tantrum.

        The RBNZ could directly finance gov spending but that is not without consequence either.

        • KJT 12.1.1.1

          Government bond purchases is "borrowing" not "printing".

          And Governments "printing" money into circulation was how we got Government supplied currencies in the first place.

          No country has ever "unwound" that!

          We left the “gold standard” because Governments were not “printing” enough for the amount of economic activity that required a medium of exchange.

          The consequence of the Government “printing” money for houses in the fifties was much cheaper housing. Enabling a successful economy and indeed a higher resulting tax surplus. Now we cannot afford to maintain a standard of living with higher taxes individually, because so much of the households income goes in housing.

          • Pat 12.1.1.1.1

            You are confusing apples with pears.

            I noted the RBNZ COULD finance the Gov spending directly…QE is not that.

            There are very real risks to the value of the NZD in doing so, which in a country that produces sweet FA of what it needs to function is bloody dangerous (IMO)

            • Nic the NZer 12.1.1.1.1.1

              "I noted the RBNZ COULD finance the Gov spending directly…QE is not that." – Pat

              I'm so glad you think that. Why doesn't Grant have a quiet word to Adrian, "well you know all that debt we owe you? The proceeds which you then must remit to us anyway, say we just call it a wash either way, (so nudge nudge, wink wink, foregive it) and you know what, can you stay on for a few more years?"

              • Pat

                and what will you do with the banks?

                • Nic the NZer

                  Well if it was up to me, probably keep them operating. Just why is that a question even?

                  • Pat

                    Using what for liquidity?….youve just taken (up to) $100 billion out of the system and destroyed their core ratios….or are you going to Nationalise them and recapitalise?…if so then why not just advocate for nationalisation of the banking system…or is that unsaleable?

                    • Nic the NZer

                      I didn't take any of their liquidity away. The government writing off debt it owes itself doesn't touch their balance sheets at all.

                  • Pat

                    Im afraid you did (or will do if you cancel those bonds)…. that is the purpose of QE, to reduce funding costs to keep interest rates low….and why if you reverse it funding costs increase and if you destroy them in one hit as you propose those funding costs will go through the roof…..even slowly removing them is problematic as with the debt levels of households we cannot cope with interest rate increases and we will see cascading defaults (ultimately we will anyway)

                    QE is primarily designed to save bank balance sheets….nothing to do with the real economy, where the funds go is of no import as long as the bank dosnt suffer a contraction in their lending levels which will bring down the whole house of cards.

                    • Nic the NZer

                      Your very confused. Writing off self held govt debt does not reverse QE at all. It just means the govt pays less interest to the RBNZ and the RBNZ remits less back as a result.

                      Also the interest rates can no longer change. The coupon is fixed and the interest rates paid on that lending were set when they were bought at a discount of that figure.

                  • Pat

                    The confusion is your own….the interest rate on the bond dosnt change the yield however does through the price….however youve just destroyed those bonds so it is the cost of the replacements that matter….and if you go around defaulting on bonds how much premium do you think you are going to pay for new issuances?….ask Argentina.

                    And then sit back and watch interests rates climb and defaults left right and centre

                    • Nic the NZer

                      Wasn't that clear? There is no default we get the RBNZ side to tear up the bonds because they are nice guys. And if at that point say nobody is buying then hey presto direct RBNZ funding is your next move and clearly can be used to write off more govt debt.

                      This will be like all the other economics stuff, we carry on with the can do that, cant do that, can do that for a while. Then the govt do it and nothing you have advertised occurs and everyone moves on.

                    • Pat

                      So your plan is to default the bonds, collapse the private banks, nationalise them, financialise the economy, and accept whatever value is placed on the NZD.

                      All perfectly possible…..and I expect totally unacceptable to democratically empowered population

                    • Nic the NZer []

                      Sure thing, because as everybody knows thats exactly how stuff works.

                      Incidentally should I refer to you as the human MONIAC machine from now on?

                    • Pat

                      How you refer to me is of no consequence.

                • mikesh

                  “and what would you do with banks”

                  I would stop them creating money "out of nothing". I think the trading in bonds by the RB has more to do with controlling interest rates.

  13. Sabine 13

    Well if they have plans they can fail. So its the best for us all specially us poor and unwashed masses to not know about any plans so as to not get our hopes up and above all so as to not get annoyed when their carefully crafted plans to work out. I mean what is the government going to do – demote itself for failure?

    ?

    Plans………..are a nice to have and surely the government will be looking into it.

  14. woodart 14

    good column. the irony of capatilists asking gov for central planning hasnt escaped me, but has obviously zoomed over the heads of many. just as ironic is seymour want NZ to be more like taiwan. the turkey asking for an early christmas. two things would happen if we were more like taiwan. firstly, seymour would be expected to be less selfish and more team oriented, and secondly ,in parliament, in taiwan, they have fistfights…. I would enjoy seeing seymour getting duffed up…

    • KJT 14.1

      I doubt Seymour would be very happy, about following Taiwan's welfare policies in recent years.

      Taiwan Social Welfare (taiwan-agriculture.org)

      Social welfare policy in Taiwan is based on the Three Principles of the People, aimed at establishing social security, distributing social wealth, and ensuring a peaceful and beneficial society.

      Almost sounds like our first Labour Government.

      • woodart 14.1.1

        good point kjt. maybe the next time seymour is in front of the media, some clever journo could ask him these questions(yeah ,right, tui ad)

  15. Pat 15

    We have a plan and it is to save the banking system ….and hope.

    Its not a good plan and ultimately will fail but its the only one considered because the alternatives are too painful to bear.

  16. Just Is 16

    And here I was thinking that the Govts plan is to keep us all safe, so far that plan has worked well.

    Our current housing problems are, in part, due to the success of the plan above.

    We have half the world wanting to come to NZ, one of the safest countries in the world today, there just isn't enough spare houses for them all, a decade of failure from Nats has come home to roost.

    • Stuart Munro 16.1

      Yeah – the Gnats aren't wholly to blame for mass low-wage immigration. If you tried to raise the issue anytime in the last twenty years pre-Covid, sanctimonious fauxgressives would be all over you for racism. Infinite inward migration was one of those neoliberal sacred cows – never mind the social costs – it was ineffable. Covid has finally got it through a few spectacularly obtuse skulls that previous generations created and enforced immigration rules for a reason.

  17. grant not robertson 17

    Thank you Nic the NZer for putting everyone right about how the banking system – the economy – actually works. When everyone (including politicians) admit that the world’s economy is merely a giant spreadsheet and any country that controls it’s own currency (and that’s not members or the EuroZone) can spend as much as they like on whatever they choose (no poverty, housing for everyone, job guarantees – you name it) then the sooner the frightful neo-liberal, Rogernomics, Thatcherism, monetarism etc system can be consigned to the dustbin of history.

  18. Incognito 18

    Yes, I’d like to see a plan, but I’m less interested in an economic plan especially if without a larger encompassing vision (AKA ideology) for our society.

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