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Tax cuts for the few, just plain cuts for the many

Written By: - Date published: 7:57 am, July 13th, 2010 - 9 comments
Categories: class war - Tags:

NZPA reports Bill English is lining up more cuts for public services under the cover of getting the books in the black.

According to English:

In our first two Budgets, the Government took early steps to bring deficits and Government debt under control. We will build on that over the next few years by living within our $1.1 billion annual allowance for extra operating spending and weeding out lower-priority spending.

Really? You could’ve fooled me – I thought that the last budget was about borrowing a billion dollars to pay for massive tax cuts for New Zealand’s richest.

But then this is the kind of dodgy accounting that this government uses to make claims that spending $1.3bn on private prisons is great because it generates $1.2bn of benefits.

If this was a straight-up transfer of wealth from the poor to the rich within a stable economy it would be bad enough but it’s not that simple. What makes it worse is the fact cutting spending now is likely to contract the economy at a time it is still extremely fragile, which will in turn create the need for more debt.

Which will then be used by the government as an excuse for more cuts and then privatisation of public assets.

Bill English isn’t stupid. He knows exactly what kind of a vicious cycle he’s risking and, in fact, he knows it from experience – exactly the same thing was done under the last National government in which he was a minister.

9 comments on “Tax cuts for the few, just plain cuts for the many”

  1. kriswgtn 1

    I dont think he cares and frankly neither do I.
    Used to be proud of living here and frankly in past 18 months that has changed
    NZ is a disgrace.NZ deserves what it gets for voting them in
    Off to OZ we go

    Good luck

  2. Carol 2

    When English, Goff and others were interviewed on this a little while ago on NatRad Morning Report, I was wondering about the way certain measures are used as a sign of the country “growing”, “improving”, “getting back in the black”, or whatever positive label they give it.

    I was reminded of Idiot/Savant’s piece on GPI yesterday:

    http://norightturn.blogspot.com/2010/07/quest-for-gpi.html

    For those who don’t know, the GPI combines the traditional measure of national advancement – GDP – with measures of environmental and social progress to give us a better measure of whether we are in fact better off.

    All three versions disagree on exactly which measures should be used, and how they should be combined, but they’re all clear that you need to measure things other than just straight economic growth.

    As for why, other countries which have measured GPI have found something disturbing:

    From World War II until the late 1970s, GDP and GPI roughly kept track. Any expansion in economic activity registered directly as a general increase in reasons to feel good about life.

    But from the 1970s, raw economic output has continued to soar (and no wonder with every family working two jobs and all hours, says Peet) while GPI has stagnated. Spinning the wheels faster has not necessarily been paying off.

  3. Shane 3

    I agree with krisstgn above – English doesn’t care because this is about transferring wealth from the masses to the elite. The workers have been disciplined since the 80s and now all the govts. around the world are transferring wealth upwards before the world economy tanks again when the peak oil hits around 2014/15. I suppose they think it is going to shield them from the consequences of energy depletion and climate change. They are saving up for a big rainy day.
    This is class warfare on a massive scale and the rich are winning because the workers don’t even understand that a war is being waged – mostly because the msm just don’t do their job. Funny how TVNZ are making cuts and the first people to go are their current affairs team? Current affairs programming in this country is so woeful it is painful to watch – and now even less is going to be done… no wonder people do not know what is going on in the country.

    • Draco T Bastard 3.1

      …mostly because the msm just don’t do their job.

      Actually, they are doing their job – ensuring that the people aren’t informed is their job.

  4. Draco T Bastard 4

    http://gordoncampbell.scoop.co.nz/2010/07/13/campbell-the-ideology-behind-state-spending-cuts/

    But then to repeat the current stringency is about an ideology of hostility to the state, and not anything to do with economic sense. To the ideologues on the centre right, it is always a good time to cut back on state spending. If we are in a recession, the O’Reillys of the world will argue, we can’t afford state spending. If we’re in a boom, they argue, we don’t need it. And if we’re where we are now, in a sickly inbetween phase, they argue we can’t afford it, because we have to (somehow, by pulling on our own bootstraps ) turn this into a competitive advantage and generally, be willing to cheerfully volunteer to accept less in the way of pubic services, in order to offset the private sector’s incompetence with respect to its own debt position.

    That’s about it. Ideology beats facts and research every time with this government.

    • Carol 4.1

      It is also interesting to hear Rod Oram’s take on Nat Rad this morning on the fragile state of the world economy:
      http://www.radionz.co.nz/national/programmes/ninetonoon

      little available in the US or UK to repeat the last stimulis packages, the widespread occurrence of the financial crisis means few can export their way out of trouble, corporations here and in the US & Europe hoarding cash unless the banks call up their loans. The latter means there is little investment going on here or in many other places by business, but Aussie is a bit of an exception with a lot of investment going on.

      And the case of Ireland’s bust following its boom is sobering, considering it wasn’t long ago that it was held up as the success story the NZ Labour government should have been copying.

  5. Seems like English is on some personal and spiteful vendetta type bullshit for the average NZer handing his failed arse back to him in shreds when he was National leader…

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