web analytics

The beggared neighbour

Written By: - Date published: 9:37 am, December 20th, 2012 - 12 comments
Categories: exports, jobs - Tags:

Japan just elected a Liberal Democrat government promising more jobs through a huge quantitative easing programme. The US has stated it’ll continue QE until unemployment drops below 6.5%. The effect has been to send our dollar to new highs, killing exporters and import-exposed local businesses. Contrary to media belief, Japan and the US aren’t in worse positions than us.

Japan has a lower and falling unemployment rate and a higher growth rate. The US’s unemployment rate is systemically higher than New Zealand’s, but it too is falling sharply and may soon fall below ours. But they’re using QE any way because it is helping them to devalue their currencies against their competitors – aiding both their exporters and their local businesses.

Meanwhile, our government does nothing and the dollar surges. Sure, that means cheaper consumer imports. But at what cost? 40,000 jobs lost in manufacturing, 7,000 lost in tourism, a claiming current account deficit as exports fall and imports rise. What does it matter if flat-screen TVs are cheap for the 300,000 jobless and 100,000 underemployed Kiwis?

We are heading for a Greece-like situation where we have massive foreign debts, all our shit is foreign-owned, and we don’t have the productive capacity left in the country to get back to an even keel.

Yet, the tools of orthodoxy in the mainstream media stomp on any suggestion of change. They’ve been drinking the neoliberal kool-aid so long that they think it’s all there is.

12 comments on “The beggared neighbour”

  1. AsleepWhileWalking 1

    Japan is substanitally worse off and we can expect a currency collapse sometime soon.

    It has nothing to do with employment rate, but rather government bonds that were issued.

    • Galeandra 1.1

      ‘substanitally worse off ‘

      Care to explain with citation/s?

    • aerobubble 1.2

      The argument I believe is this, that much future wealth was speculated to exist based on continuing cheapening supplies of energy. Over the period of cheap energy inflation was hidden, pollution, erosion of support systems, financial, ecological, social, could be managed as an opportunity for activity. But since capitalism as we have it today focuses on short terms, locking in rent seeking activity, so they essentially target the symptoms rather than the causes (the government role).
      In this context, US, Japan are just regions of one global nation, akin to Greece to the Eu, we are all awash in the same bath tub, with the same dirty water, so it more plausible to assume we should be
      do QE, and ask why we aren’t and what rewards there are for not doing so. I would argue that
      selling assets when money is devalued is pathetically stupid, why sell when we can print. Also holding ones breath for decades with tight policy, when suddenly the cycle turns and we can loosen money into our economy why aren’t we, why can’t we have a quite deep breath for all our hard work, aren’t we due a relaxation of rabid neo-liberal inflation targeting? What better time to do it. So we come to the reason why not, well higher inflation would actively help debtors write down debt, it would harm savers, it would boost incomes for exporters and harm voter buying power, and could cause a massive round of bankruptcies and foreclosures on middle stupid NZ that needs two cars and lavish indebtedness and servitude to their betters.

  2. vto 2

    So what is John Key going to do about this? Does anybody know?

    because there aint no doubt that it is going to happen ….

    • David Viperious H 2.1

      Nothing he’ll be in his house in Hawaii. He’s not going to do anything, so maybe he is going to turn our country into another Greece, so that the bastards can ‘bail us out by stealing the 20 billion in the Kiwi Saver and then Austerity as the like has never been seen. Then we would need a strong government to tell em to get stuffed like Argentina did. And that we A’int got.

  3. PlanetOrphan 3

    Well said Eddie, we need “Good Inflation” in NZ, and yes there is a lot of hype out there about good and bad inflation.

    The Gnats’ believe in “Good Deflation”, but they are profiteers and will never care about the average Kiwi getting a livable wage/salary.

    The Gnats’ wont be happy until they are the only one who can hand out charity, and it’ll only be given to people they “Like”.

  4. Richard 4

    Please, tell me more about your expertise with regards monetary policy above the zero lower-bound. I am sure you are well qualified to discuss this technical issue.

    Oh, and by the way, the Japanese economy contracted by 0.9% in the third quarter.

    • Shane Gallagher 4.1

      How about Switzerland? It is printing money explicitly to keep its franc devalued. So tell me about that… 🙂

    • bad12 4.2

      Your a funny wee chap aint you, seriously do you ever actually THINK, because from what i have read if it was not for the work that has been carried out in Christchurch associated with earthquake recovery the New Zealand economy in the last year is shown to have shrunk by at least 2%,

      Even then we have to question the ludicrous way in which the Bean Counters measure our economic activity when they class earthquake recovery as GDP, surely just one more fucking big lie in a whole series of fucking big lies that have as an end result a succession of Governments mis-managing the economy by institutional design and that’s befor the village idiot from down Dipton way has been let loose to play ‘betcha i can create as much unemployment as i did last time’ with the economy,

      Think about it logically for just a second, how can anything in the field of demolition/construction that is occurring in Christchurch at the moment be considered as ‘growth’ and be included as a positive in GDP figures???,

      That supposed growth occurred in Christchurch over the years as the City was built up prior to the Canterbury earthquakes and in those years was recorded as that growth, rebuilding post-earthquakes is simply re-building of the prior ‘growth’ and as such should not be included in GDP figures unless the loss of the prior growth was also recorded as a shrinkage in GDP at the time of the earthquakes, (to my knowledge this has not occurred),

      So for the next 2 years Slippery and that idiot from Dipton will off of the back of rapidly expanding rebuilding in Christchurch record NZ wide GDP growth of 2% annually when in fact without such bullshit replacement of prior GDP lost to the earthquakes the true picture is going to be an overall shrinkage of GDP annually of 2% annually for those 2 years if we put to one side the activity surrounding earthquake recovery…

  5. bad12 5

    The only advantage we gain across the whole economy from having a dollar over-valued by 15-20 cents is that petrol-products in theory become cheaper,

    BUT,

    Wouldn’t you know it Slippery, the Prime Minister, announced yesterday that His Government would seize that advantage for the Governments coffers by rack renting the taxes on those products over the next 2-3 years…

  6. geoff 6

    I think that maybe this article is completely misinformed.

    Japan’s debt to GDP ratio is one of the highest in the world (second only to Zimbabwe, according to wikipedia) and many commentators have said that its currency is about to collapse. From what I understand, it is not in a strong economic position.

Recent Comments

Recent Posts

  • New Zealanders’ human rights better protected in new Bill
    The law setting out New Zealanders’ basic civil and human rights is today one step towards being strengthened following the first reading of a Bill that requires Parliament to take action if a court says a statute undermines those rights. At present, a senior court can issue a ‘declaration of ...
    BeehiveBy beehive.govt.nz
    5 hours ago
  • Deep concern at Hong Kong national security legislation
    Foreign Affairs Minister Winston Peters today reiterated the deep concern of the New Zealand Government following confirmation by China’s National People’s Congress of national security legislation relating to Hong Kong. “New Zealand shares the international community’s significant and long-standing stake in Hong Kong’s prosperity and stability,” Mr Peters said. “New Zealand ...
    BeehiveBy beehive.govt.nz
    8 hours ago
  • Government invests in New Zealand’s cultural recovery
    Thousands of artists and creatives at hundreds of cultural and heritage organisations have been given much-needed support to recover from the impact of COVID-19, Prime Minister and Minister for Arts, Culture and Heritage Jacinda Ardern announced today. “The cultural sector was amongst the worst hit by the global pandemic,” Jacinda ...
    BeehiveBy beehive.govt.nz
    8 hours ago
  • Better protection for New Zealand assets during COVID-19 crisis
    Key New Zealand assets will be better protected from being sold to overseas owners in a way contrary to the national interest, with the passage of the Overseas Investment (Urgent Measures) Bill. The Bill, which passed its third reading in Parliament today, also cuts unnecessary red tape to help attract ...
    BeehiveBy beehive.govt.nz
    10 hours ago
  • Cleaning up our rivers and lakes
    Setting higher health standards at swimming spots Requiring urban waterways to be cleaned up and new protections for urban streams Putting controls on higher-risk farm practices such as winter grazing and feed lots Setting stricter controls on nitrogen pollution and new bottom lines on other measures of waterway health Ensuring ...
    BeehiveBy beehive.govt.nz
    13 hours ago
  • Record year for diversity on Govt boards
    The Government is on the verge of reaching its target of state sector boards and committees made up of at least 50 percent women, says Minister for Women Julie Anne Genter and Minister for Ethnic Communities Jenny Salesa. For the first time, the Government stocktake measures the number of Māori, ...
    BeehiveBy beehive.govt.nz
    17 hours ago
  • New appointments to the Commerce Commission
    The Commerce and Consumer Affairs Minister and Broadcasting, Communications and Digital Media Minister, Kris Faafoi, has today announced the appointment of Tristan Gilbertson as the new Telecommunications Commissioner and member of the Commerce Commission. “Mr Gilbertson has considerable experience in the telecommunications industry and a strong reputation amongst his peers,” ...
    BeehiveBy beehive.govt.nz
    19 hours ago
  • Historic pay equity settlement imminent for teacher aides
    The Ministry of Education and NZEI Te Riu Roa have agreed to settle the pay equity claim for teacher aides, Education Minister Chris Hipkins announced today. This will see more than 22,000 teacher aides, mostly women, being valued and paid fairly for the work they do. “Teacher aides are frontline ...
    BeehiveBy beehive.govt.nz
    1 day ago
  • Govt delivers security for construction subcontractors
    Subcontractors will have greater certainty, more cashflow support and job security with new changes to retention payments under the Construction Contracts Act says Minister for Building and Construction, Jenny Salesa. A recent review of the retentions money regime showed that most of the building and construction sector is complying with ...
    BeehiveBy beehive.govt.nz
    1 day ago
  • New Zealand and Singapore reaffirm ties
    Prime Minister Jacinda Ardern and Singapore Prime Minister Lee Hsien Loong have marked the first anniversary of the New Zealand-Singapore Enhanced Partnership with a virtual Leaders’ Meeting today. The Enhanced Partnership, signed on 17 May 2019, provides the framework for cooperation across the four main areas of trade, defence and ...
    BeehiveBy beehive.govt.nz
    1 day ago
  • JOINT STATEMENT BY THE PRIME MINISTERS OF NEW ZEALAND AND THE REPUBLIC OF SINGAPORE ON THE FIRST AN...
    On 17 May 2019, New Zealand and Singapore established an Enhanced Partnership to elevate our relations. The Enhanced Partnership – based on the four pillars of trade and economics, security and defence, science, technology and innovation, and people-to-people links – has seen the long-standing relationship between our countries strengthen over the ...
    BeehiveBy beehive.govt.nz
    1 day ago
  • Government investment supports the acquisition of new Interislander ferries
    State-Owned Enterprises Minister Winston Peters has welcomed KiwiRail’s announcement that it is seeking a preferred shipyard to build two new rail-enabled ferries for the Cook Strait crossing. “This Government is committed to restoring rail to its rightful place in New Zealand. Bigger, better ships, with new technology are yet another ...
    BeehiveBy beehive.govt.nz
    1 day ago
  • Better protection for seabirds
    Better protection for seabirds is being put in place with a new National Plan of Action to reduce fishing-related captures, Fisheries Minister Stuart Nash and Conservation Minister Eugenie Sage announced today.   The National Plan of Action for Seabirds 2020 outlines our commitment to reduce fishing-related captures and associated seabird ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Milestone in cash flow support to SMEs
    Almost $1 billion in interest-free loans for small businesses More than 55,000 businesses have applied; 95% approved Average loan approx. $17,300 90% of applications from firms with ten or fewer staff A wide cross-section of businesses have applied, the most common are the construction industry, accommodation providers, professional firms, and ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Government protects kids as smoking in cars ban becomes law
    Thousands of children will have healthier lungs after the Government’s ban on smoking in cars with kids becomes law, says Associate Minister of Health Jenny Salesa. This comes after the third reading of Smoke-free Environments (Prohibiting Smoking in Motor Vehicles Carrying Children) Amendment Bill earlier today. “This law makes it ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Parliament returns to a safe normal
    The special Epidemic Response Committee (ERC) has successfully concluded its role, Leader of the House Chris Hipkins said today. The committee was set up on 25 March by the agreement of Parliament to scrutinise the Government and its actions while keeping people safe during levels 4 and 3 of lockdown. ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Foreign Minister makes four diplomatic appointments
    Foreign Affairs Minister Winston Peters today announced four diplomatic appointments: New Zealand’s Ambassador to Belgium, High Commissioners to Nauru and Niue, and Ambassador for Counter-Terrorism. “As the world seeks to manage and then recover from COVID-19, our diplomatic and trade networks are more important than ever,” Mr Peters said. “The ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • New Bill to counter violent extremism online
    New Zealanders will be better protected from online harm through a Bill introduced to Parliament today, says Internal Affairs Minister Tracey Martin. “The internet brings many benefits to society but can also be used as a weapon to spread harmful and illegal content and that is what this legislation targets,” ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • Mycoplasma bovis eradication reaches two year milestone in good shape
    New Zealand’s world-first plan to eradicate the cattle disease Mycoplasma bovis is on track the latest technical data shows, says Agriculture and Biosecurity Minister Damien O’Connor. “Two years ago the Government, DairyNZ and Beef + Lamb New Zealand and industry partners made a bold decision to go hard and commit ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • New payment to support Kiwis through COVID
    Further support for New Zealanders affected by 1-in-100 year global economic shock 12-week payment will support people searching for new work or retraining Work programme on employment insurance to support workers and businesses The Government today announced a new temporary payment to support New Zealanders who lose their jobs due ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • PGF reset helps regional economies
    The Provincial Growth Fund will play a vital role in New Zealand’s post-COVID-19 recovery by creating jobs in shorter timeframes through at least $600 million being refocused on projects with more immediate economic benefits, Regional Economic Development Minister Shane Jones has announced. The funding is comprised of repurposed Provincial Growth ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Government exempts some home improvements from costly consents
    Government exempts some home improvements from costly consents Homeowners, builders and DIYers will soon have an easier time making basic home improvements as the Government scraps the need for consents for low-risk building work such as sleep-outs, sheds and carports – allowing the construction sector to fire back up quicker ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Concern at introduction of national security legislation for Hong Kong
    Foreign Affairs Minister Winston Peters says the New Zealand Government has reacted with concern at the introduction of legislation in China’s National People’s Congress relating to national security in Hong Kong.  “We have a strong interest in seeing confidence maintained in the ‘one country, two systems’ principle under which Hong ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Samoa Language Week theme is perfect for the post-COVID-19 journey
    The Minister for Pacific Peoples Aupito William Sio, says the theme for the 2020 Samoa Language Week is a perfect fit for helping our Pacific communities cope with the unfolding COVID-19 crisis, and to prepare now for the journey ahead as New Zealand focuses on recovery plans and rebuilding New ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Adult kakī/black stilt numbers soar
    A nearly 40-year programme to protect one of New Zealand’s most critically endangered birds is paying off, with a record number of adult kakī/black stilt recently recorded living in the wild, the Minister of Conservation Eugenie Sage announced today. “Thanks to the team effort involved in the Department of Conservation’s ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Waikato-Tainui settlement story launched on 25th anniversary of Treaty signing
    The story of the Waikato-Tainui Treaty process and its enduring impact on the community is being told with a five-part web story launched today on the 25th anniversary of settlement, announced Associate Arts, Culture and Heritage Minister Carmel Sepuloni. “I am grateful to Waikato-Tainui for allowing us to help capture ...
    BeehiveBy beehive.govt.nz
    7 days ago
  • Taita College to benefit from $32 million school redevelopment
    Taita College in the Hutt Valley will be redeveloped to upgrade its ageing classrooms and leaky roofs, Education Minister Chris Hipkins announced today. “The work is long overdue and will make a lasting difference to the school for generations to come,” Chris Hipkins said. “Too many of our schools are ...
    BeehiveBy beehive.govt.nz
    7 days ago
  • Redeployment for workers in hard-hit regions
    The Government is allocating $36.72 million to projects in regions hard hit economically by COVID-19 to keep people working, Economic Development Minister Phil Twyford and Regional Economic Development Minister Shane Jones announced today. Projects in Hawke’s Bay, Northland, Rotorua and Queenstown will be funded from the Government’s $100 million worker ...
    BeehiveBy beehive.govt.nz
    7 days ago
  • $35m to build financial resilience for New Zealanders
    A $35m boost to financial capability service providers funded by MSD will help New Zealanders manage their money better both day to day and through periods of financial difficulty, announced Social Development Minister Carmel Sepuloni. “It’s always been our position to increase support to key groups experiencing or at risk ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • New District Court Judge appointed
    Dunedin barrister Melinda Broek has been appointed as a District Court Judge with Family Court jurisdiction to be based in Rotorua, Attorney-General David Parker announced today. Ms Broek has iwi affiliations to Ngai Tai. She commenced her employment in 1996 with Scholefield Cockroft Lloyd in Invercargill specialising in family and ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • $206 million investment in upgrades at Ohakea Air Force Base
    The Coalition Government has approved a business case for $206 million in upgrades to critical infrastructure at Royal New Zealand Air Force Base Ohakea, with the first phase starting later this year, Defence Minister Ron Mark announced today. The investment will be made in three phases over five years, and ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Review of CAA organisational culture released
    Transport Minister Phil Twyford today released the Ministry of Transport’s review of the organisational culture at the Civil Aviation Authority. Phil Twyford says all employees are entitled to a safe work environment. “I commissioned this independent review due to the concerns I had about the culture within the CAA, and ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • New Board appointed at Stats NZ
    Ensuring that Stats NZ’s direction and strategy best supports government policy decisions will be a key focus for a new Governance Advisory Board announced today by the Minister for Statistics, James Shaw. The new Governance Advisory Board will provide strategic advice to Stats NZ to ensure it is meeting New ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • New Principal Environment Judge
    Environment Judge David Kirkpatrick of Auckland has been appointed as the Principal Environment Judge, Attorney-General David Parker announced today.  Judge Kirkpatrick was appointed an Environment Judge in February 2014. From December 2013 to July 2016 he was Chair of the Auckland Unitary Plan Independent Hearings Panel. Prior to appointment he ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Digital connectivity boost for urban marae
    A programme to connect marae around the country to the internet has received $1.4 million to expand to include urban marae in Auckland, Wellington and Christchurch, Broadcasting, Communications and Digital Media Minister Kris Faafoi and Regional Economic Development Minister Shane Jones announced today. The funding for the Marae Connectivity Programme ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Govt increases assistance to drought-stricken Hawke’s Bay farmers
    The Government will provide $500,000 to the Hawke’s Bay Mayoral Drought Relief Fund to help farmers facing one of the worst droughts in living memory, says Agriculture Minister Damien O’Connor. “Yesterday afternoon I received a letter from Hawke's Bay's five local Government leaders asking me to contribute to the Fund. ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Investment in New Zealand’s history
    Budget 2020 provides a major investment in New Zealand’s documentary heritage sector, with a commitment to leasing a new Archives Wellington facility and an increase in funding for Archives and National Library work. “Last year I released plans for a new Archives Wellington building – a purpose-built facility physically connected ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Driving prompt payments to small businesses
    Government Ministers are asking significant private enterprises to adopt prompt payment practices in line with the state sector, as a way to improve cashflow for small businesses. The Ministers of Finance, Small Business, Commerce and Consumer Affairs have written to more than 40 significant enterprises and banking industry representatives to ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Rotorua tourist icon to be safeguarded
    Maori Arts and Crafts will continue to underpin the heart of the tourism sector says Minister for Maori Development Nanaia Mahuta.  “That’s why we are making a core investment of $7.6 million to Te Puia New Zealand Māori Arts and Crafts Institute, over two years, as part of the Government’s ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • $14.7m for jobs training and education
    The Government is funding more pathways to jobs through training and education programmes in regional New Zealand to support the provinces’ recovery from the economic impacts of COVID-19, Regional Economic Development Minister Shane Jones and Employment Minister Willie Jackson have announced. “New Zealand’s economic recovery will be largely driven by ...
    BeehiveBy beehive.govt.nz
    1 week ago