THIS IS THE TIME of maximum danger for Jacinda Ardern. Caught off-guard by their stop-gap leader’s astonishing energy and confidence, the tired grey men of the Labour Party could only look on in wonder like the rest of us. As public expectations of Jacinda have soared, however, the men and women of Labour’s political apparatus are beginning to close in around her.
Their message was as simple as it is emphatic: Labour’s new leader must not allow the public’s expectations of an Ardern-led government – especially those of its younger members – to force the political agenda. Dampening down voter expectations has become a matter of urgency for Jacinda’s advisers.
The mantra du jour is: “Promise nothing that can’t be paid for!” Under no circumstances must Labour’s commitment to fiscal discipline – as codified in the Labour/Green “Budget Responsibility Rules” – be compromised. “If you can’t tell the voters how a promise is to be paid for, then don’t make it.”
What they fear most right now is the growing expectation that Jacinda is on the point of introducing a universal student allowance and announcing the abolition of tertiary fees. That such a promise, delivered to thousands of cheering university students, would set off a “youthquake” and, almost certainly, clinch the election for Labour, cuts no ice with Jacinda’s hyper-cautious counsellors.
And, if her comment to Duncan Garner: “universal may be going a bit far”; is any guide, then Jacinda is on the point of heeding the grey men’s advice. In her desire to appear fiscally responsible, she is on the point of needlessly blowing-off the “Jacinda-Train’s” election-winning head-of-steam.
What Jacinda needs to comprehend, urgently, is that there is always money to be found for things that are dear to a government’s heart. Remember the $1.5 billion that miraculously materialised to rescue the National Party-voting victims of South Canterbury Finance? As was the case with the contemporaneous bailouts of the banks and finance houses in the United States: when faced with the prospects of their friends going under, the Powers-That-Be will always find the money to socialise their losses.
The history of the Labour Party she leads is there to guide her on these critical matters. The First Labour Government’s state-housing programme could never have gone ahead had Mickey Savage and his colleagues not required the Reserve Bank to, in effect, grant their government a huge overdraft.
The same option is open to anyone who commands a state that issues its own currency – as Bill English confirmed when he authorised his billion-dollar South Canterbury bailout. Clearly, Jacinda heard her advisers when they told her that money doesn’t grow on trees. What she has yet to grasp, however, is that it can be made to materialise out of thin air! If she wants to call an end to tertiary fees and introduce a universal student allowance, then she should do so. If Grant Robertson objects, then ask David Parker to do it.
Nor should she be afraid to go for broke when it comes to spending-up large on health, education, welfare and infrastructure. As the late Sir Owen Woodhouse pointed out a few years ago, the ACC Fund contains tens-of-billions of dollars. At the moment, their purpose is to guarantee our “fully-funded” ACC Scheme. But that fully-funded requirement only exists because the Nats were planning to privatise ACC. Were Labour willing to pass a law reinstating ACC’s original “pay-as-you-go” funding formula, then Jacinda would have all the money she needs to end poverty, repair New Zealand’s broken social services, and future-proof its decaying infrastructure.
One of the reasons David Cunliffe failed to fire as Labour’s leader in 2014 is because one minute he was promising to deliver Labour’s Brave New World, and the next he was reassuring the astonished news media that his promised land would only be delivered “as finances permit”. If “Jacindamania” is robbed of its gathering momentum by a similar propensity to raise expectations with one hand, only to dampen them down with the other, then Labour will, once again, be seen to snatch defeat from the jaws of victory.
You said “Let’s do this!”, Jacinda. Now prove to us that you meant it.
To be honest, free tertiary education, and some other deserved policies, they require higher taxes for the better off, but that is where the media, the Labour machinery and Council, the caucus, and of course the vested interest business and upper middle class voter lobbyists will put a stop to it.
Jacinda has already made rather clear, she will not go that far, so what is your expectation, it will not happen, it will not happen the way it should, due to the scare of the establishment and the supposedly silent majority middle class voters.
That the means are tricky and require caution doesn’t make, in principle, the end result undesirable.
But either the middle class takes part on the increase of income caused by the increase of production, or you will have a “breadcrumbs” scenario where few people get the power.
And not in a “10% has 50% of all money” way no, more like a “a few hundreds have 50% of the global industrial output” case. Society so far has survived because of 2 facts: economic growth means good things for most, and lords deppend on servants (who in turn deppend on lords)
With robots and sapient machines, those 2 facts need not be true.
Gradually extending safety nets to more and more people, until you have a UBI is a way. Sharing the means of production could be an option, but that ship already sailed (and crashed, and burned, and tried to keep sailing while stuck and burning).
100% SAM well said.
You’re spot on – we have very low tax rates in NZ relative to other developed country. Any revitalized Labour Party has to argue for reversing the tax cuts of 2008 and it has to win that argument before it starts anything else.
When you say low tax rates you mean exclusive of GST at 15% I assume ?
Let’s go over a list:
White and Blue Collar Laborers: Do hard work to produce value. EARNED.
Government Employees: Provides for infrastructure and other collective dilemmas. EARNED.
Investors: Own piles of money, which they use to make more money. Often inherited. NOT EARNED.
I’m not sure why this is such a hard exercise for people to get. Virtually everything given to you in your childhood is not earned. Getting to live in a nice community, or having the laws and markets and governments skewed in favor of your demographic, that is not earned. Capital gains are not earned. The hoarding of profit from increased per capita production via automation is not earned. Yet these are the factors which distinctively divide the haves from the have nots.
Meanwhile time and time again, its been shown that investment in the poor pays off and then some for the economy, but the government is the only one that can reclaim its fair share of the investment after via taxes on the economy, which it can then reinvest that in the next generation. Entitlements have always been good business sense, and these days, they’re the only things that have kept capitalism from just collapsing the economy, and even then, its still been a close at times.
Wealth redistribution is both helpful to the economy and at this point a necessity. Our economy is demand driven, it runs off service industries and consumption primarily. Yet money has been siphoned out of the material economy driving consumption and into the finance sector at disproportionate rates. We need to get a significant amount of that money out of the financial sector and banks. Back into the hands of ordinary lower to middle class workers who will spend it and raise demand. Money that remains in the financial sectors creating more theoretical money in the financial sector is ultimately worth far less than money buying tangible goods and services to keep the economy operating.
As the issuer of currency the Government can never run out. Japan is currently paying down its national debt by having its reserve bank buy its debt and then canceling it. The first NZ Labor government payed for its housing program by “printing money. ” The only limits to government spending is the distortion to the economy if it gets excessive.
careful what you wish for….unlike Japan NZ is a net importer with a poor savings record and has been forever and a day…we may be able to “print” as much as we like but you may wish to work out which imported goods we can do without (or alternatively who goes without)
As the issuer of currency the Government can never run out. Japan is currently paying down its national debt by having its reserve bank buy its debt and then canceling it. The first NZ Labor government payed for its housing program by “printing money. ” The only limits to government spending is the distortion to the economy if it gets excessive.
1000% BRENT.
How can NZ compete with our partners overseas when those countries use Quantitative Easing or (printing money) against their public assets when we sell our’s first!!! because we have no money to retain them???????
We need to be placed on “a level playing field” and use QE to buy back our assets again so we can share that combined wealth instead of the profits being channeled overseas without any benefit to us collectively.
Common sense policy is the way to go.
You seem to think she is going to be something wonderful.
She is not.
She’s going to be bloody Helen Clark MkII.
Gee thanks…
yep much
Bloody well done Chris,
The Reserve bank Act was set up for this type of intervention for public services we granted under a guaranteed low interest loan from our own bank.
This toxic Government have given many millions away to other countries without even asking us ” the taxpayers” while showing the true facts of how is is to be paid for or that hos we can pay for it.
Secondly + most importantly Chris,;
Since we have had money simply sent from our taxpayer account to these foreign Governments without so much as any due diligence how it is to be paid for since 2008!! when this toxic Government took over the treasury benches, several of these countries may have been recipients of “QE” “Printed money from other sovereign Government reserve bank facilities.
Whereas this Government has “steadfastly refused to consider at any time intervention” of our ability to use the reserve Bank Act to similarly print money for our restoration of our “essential services” + instead has loaded us up with foreign debt with higher interest payments that has all but sent us into default and forcing us instead to sell all our assets!!!!!!
Current Crown Debt now sits at over $96 Billion in 2017 when it was only $7 Billion in 2008!!!
Example; http://www.investopedia.com/terms/q/quantitative-easing.asp
“Quantitative easing is considered an unconventional monetary policy, but it has been implemented a lot in recent times. Following the global financial crisis of 2007-08, the U.S. central bank, the Federal Reserve, implemented several rounds of quantitative easing. More recently, the Bank of Japan and the European Central Bank have implemented QE.”
QE and we could well have been almost free of any debt by 2025-30!!!!
This Criminal Government lays lying here.
Prefer an authoritative bitch over a religious fundamentalist.
“She’s going to be bloody Helen Clark MkII.”
I believe you’re right, J S BARK.
There was nothing wrong with Aunty Helen until the for shore and see bed. At least her and her government delivered surpluses and she stood up to those Aussie clowns unlike our Sir key who got a knighthood and then f..d of when he realized he was hated by so many. Then he had a damned cheek to say NZ children should not be homeless or have no food but his policies exacerbated the above he is so sickening to watch and then he said the sacrifices his wife and family made want to throw up.
“The First Labour Government’s state-housing programme could never have gone ahead had Mickey Savage and his colleagues not required the Reserve Bank to, in effect, grant their government a huge overdraft.”
Just as well that back in the day those hoards of tourists coming here paid that overdraft off then.
Oh. Wait? No, they didn’t. There were no tourists as such. So? Who did?? And how ???
If Labour doesn’t lure the farmer over then all Labour can do is wake up sweating and screaming at 4.00 am. There’d only be one thing worse than losing the election for Labour and that’d be winning it.
100% CB.
Labour must return to basic monetary fundamental policies as they did then when we were struggling out of the last deep depression so it is simple common sense.
Jacinda, I wish you would stand for this, but you do not, so I doubt you:
https://www.youtube.com/watch?v=VP3tClyL-3I
Must be the preference of feel good aye:
https://www.youtube.com/watch?v=JzMVIuTDc-s
https://www.youtube.com/watch?v=w8UGs0rdhq8
The thing is that the money put into our education system is still our system ….it just get’s spent by different people.
Unlike Key and English who paid an Australian company a fortune for the flawed untested Nova pay system and paid an Australian company a fortune to broker the selling off of our state assets , as just a couple of traitorous examples..that money has gone for good out of our system .
Money for a Convention Centre built by a Chinese Co. …no problem …bye bye money.
Or our prisons run appallingly by a British co. ….bye bye money.
The myth that National are the better economic mangers needs to be a exposed for what it is and dealt to….National are one dimensional short termist money managers …..penny wise…pound foolish !
They and the media use the ‘we are the best’ bullshit line all the time to try and hoodwink the electorate and make Labour gun shy.
Looking back over history and on every measure Labour have proven to be the most astute economic managers.
Holistic thinking always wins out in the long run….
Let’s do this now, thanks Jacinda:
https://www.youtube.com/watch?v=w8UGs0rdhq8
https://www.youtube.com/watch?v=8YJeLwW50No
Porque:
https://www.youtube.com/watch?v=if68iitWFsQ
Where do you stand on the Worker’s Day dear Jacinda?
There, like them?
https://www.youtube.com/watch?v=FzP9muZytPk
Who would Ardern be reading in the immediate media but you. There is nothing that reminds you of ‘our’ ideal in the Labour ‘right wing’. They are all oil and smog. No, no more ’84.
If Jacinda can confidently answer my questions above, I may even vote for her, out of desperation, I am near there anyway, but I want assurances
This is what Auckland deserves, you fi###ig shits:
https://www.youtube.com/watch?v=sjfoTFZYSuM
[Comment declinmed for publication. Offensive language and extreme. Marc if you persist, your posting privileges will be temporarily suspended. – -Scarletmod]
Persuasion rather than fight. You understand our coffee grounds
and turpitude.Ffight forever Lad.
No one here much belives in her, being connected in.
Marc has been busy.
Jacinda can afford to be bold, but she can still choose her battles.
If she backslides on “no new taxes” to “we’ll fund appropriately” while emphasizing the tax review, she has more room to move.
Listing aspirations when the country has been programmed to expect fully costed is a risky plan. “How are you going to pay?” is just too easy a question to ask, and if the answer is any more complex than “it’s in our policy handout” probsbly a losing one.
Dramatic gamechangers aemre for parties in power, not unknown and untried commodities like Jacinda.
Sure there is so much that can and should be done, but playing fast and loose with fiscal planning will just scare the horses and make you sound like the Left incarnate.
That said, it would be a good move for a signature policy attached to Jacinda to be announced, and I guess this tertiary thing, essentially the existing Labour plan on steroids, will be it.
Something for younger Kiis would be good, sure, but something meaningful for beneficiaries (maybe about boarders, plus another $25+?) would also be good, while invoking the spirit of Metiria Turei, for those with ears to hear. She won’t have to say the name. Commentators will do it for her.
That’s spooky Chris – I was just contemplating that Sth Canty bailout yesterday as a fine example in NZ of $$ from thin air.
If only we had sufficient politicians brave enough to use it to tell the truth (Democrats for Social Credit would be about it I’m guessing).
There is only one thing I object to in this post Chris, and its that you have come very close to infantalising Jacinda Ardern.
You have blamed “tired grey men” for this policy cringe, and it may be true, but she is not a child, she is responsible for her own decisions, even if she received counsel from others.
Women are frequently applauded as moral agents when they stand up for women’s issues, like the “baby question”, but when it comes to matters less laudable, we don’t want to consider them capable of evil or morally questionable decisions. This is a very old, very bad, very patriarchal habit.
Like men, women are always moral agents. We are always responsible for our conduct and decisions, except under immediate physical duress. Only children and babies are not. And when you fail to ascribe full moral responsibility to someone, even if you are well-intentioned, you are infantalising them.
Jacinda Ardern is perfectly capable of being evil. As we all are. And since she apprenticed under Tony Blair, who lead Britain into the disastrous Iraq War, it would be a very serious mistake indeed to infantalise her or think her fundamentally incapable of making seriously evil decisions, and make them without blinking.
When Theresa May punched yet another hole in her own political boat with her now famous “No Magic Money Tree” comment, no one thought to infantalise her then, and rightly so.
Now Jacinda Ardern is on the verge of having her own “No Magic Money Tree” moment, not because of any “tired grey men”, but because that is what she genuinely believes, as a card-carrying member of Tony Blair’s “Neo Labour”. She is *not* a baby, or a little girl. She is a fully grown woman, with full moral agency. This is her policy. But even if it were not, she is still responsible for it. She is as capable of being every bit as good or bad, as stupid or wise, as evil, ignorant, arrogant, venal, short-sighted or hypocritical as any man. No one should ever forget it. And everyone needs to start treating her that way.
I suspect Jacinda Ardern is smart enough to put out there whatever it takes to win this election. Then as leader of the Labour Party, The Govt and being PM the true extent of her mettle will be on display. The National govt could not have spent the billions on SCF or any other nod to its cronies unless it was the govt.
As for Ardern being a “Blair” apprentice that can only be of political educational benefit. Its always helpful to know what not to do.
Chris, apparently you STILL do not understand that ALL money is created out of thin air by banks, and that the charging of interest on money created out of thin air is a SCAM.
Chris, apparently you STILL do not understand that the present economic-political system is predicated converting oil (extracted from difficult places) into waste, and that oil is what allows central banks to perpetuate their Ponzi scheme.
Chris, apparently you STILL do not recognize that the purpose of politics in NZ is to keep the masses uninformed about all the fundamental issues and to keep the masses locked into the bank-controlled economic system.
Like the vast majority of people who comment here, apparently you do not recognise that the bankers’ Ponzi scheme is in its final phase of stagnation before it starts to completely unravel as a consequence of diminishing returns in the financial sector and the energy sector, and that numerous nations have already ‘fallen off the cliff’, with rigged interest rates, rigged share markets, rigged energy prices and rigged consumer markets the only things holding the system together at this point of time…….as we collectively head into the worse environmental catastrophe of all time (which is a direct consequence of the failure of politicians over many decades to address anything that matters).
https://www.youtube.com/watch?v=pYyugz5wcrI
I would be pretty sure that ” Let’s do This” was no more than a natural reaction to suddenly and completely out of the blue being thrust into the leadership position seven weeks before the election. She either took a deep breath and went for it or wimped out. She took the former option and good on her. But attributing the phrase to anything that happens after the election is not justified IMO.
However the widespread and infinitely various interpretations attributed are working well for her so good luck.
D J S
If money is to be created from nothing by the RB, it would probably pay to reimpose the reserve ratio system on the commercial banks. In Muldoon´ s time, before the RB became independent, the reserve ratio seemed to fluctuate between about 20 and 25 percent.
Superbly put Chris Trotter. The tenor of your musings is what we used to call good old ideology. There’s been a lack of that from the main parties.
If Jacinda (or Winston) were to say, we’ll restore the public health system, whatever the cost, I’d imagine an outpouring of votes in their direction.
Well given that she is now level at 30 % with Bullshit Bill in the latest 3 Reid research poll she could say that she’s the devil reincarnated and still get an outpouring of voters. Long may it continue. Now back to Bullshit Bill and those 450 odd Barclay texts?
One Snooze Cold Hard Brunton, not Newsgrub Reid.
1000% Tom,
I am a disabled person and know full well how this evil administration has gutted the funding of our public health system.
I am still waiting for over 7 yrs for a Inguinal Hernia-Surgery, a colonoscopy, and surgery on my knee!!!!!
Don’t even ask about my now rotting teeth that national took us off of the “emergency” dental repair service the last labour Government had as a subsidised service in 2007.
Yes I am clinging on to life here at 72 yrs old no thanks to Nactional.
They must be gone by September 23rd 2017.
Revolting this National Government.
Neoliberalism has destroyed our Health & Mental Health Systems which were built by our forebears ? Why ?
The heading for this article is misleading because Mr Trotter you know full well our bias NZ mainstream media will ask how do you intend to pay for that (policy)
Then our tory government will say that the policy is social engineering and nannyism.
Based on the homelessness, under-employment, Drug issues, rising inequalities and many other social problems in our country looks like we could do with a nanny at the moment.
NZ Paradise….lost.
http://werewolf.co.nz/2017/03/land-of-the-long-white-egalitarian-myth/
Revolting this National Government.
Neoliberalism has destroyed our Health & Mental Health Systems which were built by our forebears ? Why ?
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