50 years of no trickle down – has anyone told Labour?

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One of the most ideologically damaging aspects of Labour opening the floodgates of printed billions to corporate banks is the use of failed trickle down economics to justify it.

Not only does this speculator welfare damage the immediate aspirations of renters and first time home buyers, it’s a flawed bitter solution that promises empty neoliberal faith rather than genuine hope.

Labour flooded the speculators under the belief that this speculative sugar hit in property valuations will generate enough paper illusion of wealth that credit cards will be extended and generate a wave of extra spending into the local community.

Turns out the neoliberal promise of trickle down, the idea tax cuts for the wealthy will trickle down to us little people was all bullshit…

50 years of tax cuts for the rich failed to trickle down, economics study says

TDB Recommends NewzEngine.com

Tax cuts for the wealthy have long drawn support from conservative lawmakers and economists who argue that such measures will “trickle down” and eventually boost jobs and incomes for everyone else. But a new study from the London School of Economics says 50 years of such tax cuts have only helped one group — the rich.

The new paper, by David Hope of the London School of Economics and Julian Limberg of King’s College London, examines 18 developed countries — from Australia to the United States — over a 50-year period from 1965 to 2015. The study compared countries that passed tax cuts in a specific year, such as the U.S. in 1982 when President Ronald Reagan slashed taxes on the wealthy, with those that didn’t, and then examined their economic outcomes. 

Per capita gross domestic product and unemployment rates were nearly identical after five years in countries that slashed taxes on the rich and in those that didn’t, the study found.

But the analysis discovered one major change: The incomes of the rich grew much faster in countries where tax rates were lowered. Instead of trickling down to the middle class, tax cuts for the rich may not accomplish much more than help the rich keep more of their riches and exacerbate income inequality, the research indicates.

“Based on our research, we would argue that the economic rationale for keeping taxes on the rich low is weak,” Julian Limberg, a co-author of the study and a lecturer in public policy at King’s College London, said in an email to CBS MoneyWatch. “In fact, if we look back into history, the period with the highest taxes on the rich — the postwar period — was also a period with high economic growth and low unemployment.”

…has anyone told Labour yet?

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21 COMMENTS

  1. Is it true that Grant Robertson doesn’t know what happens when hundreds of billions are printed?

    Has he heard of debasing your currency?

    We’ve got double the amount of money in circulation bit the same amount of goods and services of not fucken less.

    Financializing the poor so everyone spends more on the same amount of goods and services with no thought what so ever of increasing production is an operational discretion of the highest order.

    My god. Oh my fucken god. Fuck you Labour. Don’t fucken borrow for consideration you stupid fucks. Borrow for production. And get some god bless after freinds.

  2. Labour were told alright, back in the 80s if you read Chris Trotter and Bruce Jesson, and the half dozen small marxist groups–CPNZ, SUP, SAL, WCL etc. and by countless politically aware New Zealanders with some class understanding.

    They were told by the formation of the New Labour Party, and the subsequent Alliance (which was responsible for Kiwi Bank and Paid Parental Leave).

    They have been told continuously by the unemployed movement and NGO advocates for those with lives smashed by the Rogernomics/Ruthanasia wrecking ball swung through manufacturing, the state sector, and the provinces.

    They WERE TOLD. But as ordinary people”s participation in political affairs dropped off over the last 36 years, the NZ Labour Party spits with disdain on its rank and file membership, who have little left wing guidance or institutional memory left anyway. It is a centrist party of hegemonic neo liberalism. What should be the class left leadership in this country–the NZCTU–is anything but, but that too can be turned around ultimately by working class people. The Govt. should be bricking themselves when they meet the national working class leadership–retire Wagstaff, and lets see some new union leaders with courage and inspiration.

    The housing crisis, crippling rents and low wages, will only change with direct action and pressure on the timid Labour Caucus. Occupy empty buildings and homes, nationwide rolling strike action, community organisation to support each other. The new gen shift in power has to start in the 2023 General Election. Not all boomers are selfish bastards either, many of us have fought all our lives against capital one way or another, and would relish one more chance to stick it to the man!

    • Absolutely spot on analysis. AND yes i agree that the only change for the betterment of the people suffering under neo-liberalism will come from direct grass roots protest action that cannot be ignored.

    • Right with you there Tiger Mountain. Knew I could rely on you for an accurate summation of the destruction of NZ by Rogernomics.

  3. The team of 5 million is full of treacherous Judases who were saved by the young and then shafted the young by buying up rentals and enriching themselves. Jacinda quickly chose sides and decided to enrich her rich friends even further. Jacinda is a wolf in sheeps clothing and looks determined to punish the young and poor. If you are young move to Oz as soon as possible, the NZ elites hate you and want to keep you down forever. Oz will give you more opportunities and more respect.

  4. ” …has anyone told the Blairites yet ”
    Off course numerous times and they themselves acknowledge the market has failed when they talk about bridging the vast divide between the top twenty and the rest of the neo liberal wage slaves.
    Its just soothing words to ease the hand wringing of the middle class who are aghast at the deprivation and want to know something is being promised to help fix it. The true misery is off course hidden from those in the wealthy suburbs , they don’t want to have to look to long at the real carnage caused by trickle down and our media plays lip service to it with their attempt to care with the odd snippet here and there. Not one documentary by the esteemed Bryan Bruce at prime time to at least provoke some kind of serious discussion about the economic disaster that the market has been for the last generations of New Zealanders since 1984 to today. No one questions that the current order is dooming us to extinction and never ending hardship for many who have accepted it as inevitable and permanent.
    The current Social Democrats have done extremely well out of the rich mans revolution that they are blinded by bling this system affords them. They ARE neo liberal believers and the problems are really just an inconvenience to the market doing it’s job. They are compromised and will never back away from the current neo liberal approach it is to harder challenge to contemplate when just a little tinkering here and there will suffice.
    There are no Kiwi Corbyn’s or Sanders to take the fight to the centre stage. Nothing will change unless a new movement is formed and a political realignment takes place. The fightback is long overdue.

  5. Ah, but you forgot TINA, Martyn. There Is No Alternative. Maggie told us decades ago. And everyone repeats.

    Anyway, the fact that there are hundreds of alternatives doesn’t count when you are from a privileged background and you are serving the banks and corporations and opportunists that run the show….and serving yourself.

    The fact that TINA is dead doesn’t stop the maniacs from pumping oxygen into her whilst they operate the artificial heart and artificial lungs, and zap her with electric shock to make the dead flesh twitch like a carcass in an abattoir.

    Needless to say, the maniacs will ‘kill the planet’ (well, most of the life on it) in their pursuit of dysfunctional theories that serve the 1%ers.

    Victor Frankenstein has many challengers in modern times. And there are now more zombie corporations living off central bank money-printing and no taxes than in any horror film.

    Does anyone else think this will all end very badly? Quite soon. Charles Hugh Smith does.

    Apparently the game has gone badly wrong for the looters, manipulators and speculators in recent weeks, and instead of them getting all the benefits, a small band of ‘nobodies’ has found a way to play the ‘elites’ game and loot the till. Oops!

    Quick! Pass some legislation to make it illegal!

    ‘No wonder the skimmers and scammers and political refuse that passes for “leadership” in today’s America are shocked, shocked by the open and openly gleeful democratized speculation that (like cryptocurrencies) is enriching the wrong people, i.e. commoners. It’s as if the debt-serfs, tax donkeys and decapitalized peasants stormed the castle at night and broke open the jewel box and the stash of champagne, and proceeded to swing from the chandeliers, mocking the self-serving privileged who’d been pillaging the nation for decades via their legalized looting.’

    https://www.oftwominds.com/blogjan21/democratizing-speculation1-21.htm

    • For some reason that link doesn’t go to the intended destination. However, the next article by CHS takes the US (and by implication NZ) to the place the neoliberals do NOT want; market meltdown (to accompany the environmental meltdown the neoliberals have orchestrated).

      Since NZ is so caught up in the scams and frauds that ARE America, as well as operating its own scams and frauds, none of this bodes well for the neoliberal government of Jacinda Adern, nor the country as a whole.

      And to add to the woes of the neoliberal establishment, the roll out of Covid vaccines isn’t going at all well, with shambolic Britain doing far better than most other nations, yet still failing.

      Catastrophe on all fronts -which is what we would expect from a system that loots and pollutes and operates scams and frauds, and lies to cover up [in the short term] its failings.

      The latest CHS article:

      The Stock Market, Fatally Wounded by the Truth, Will Stumble and Crash
      January 30, 2021

      It didn’t have to be this way, but this is the reality we must now face: truth is fatal to fraud, and our entire financial-political system is a fraud.

      The stock market has just been punctured by the thin blades of truth. It is fatally wounded but nobody dares notice. The wounds are barely visible, but the internal damage is mortal. The stock market is already stumbling and will soon crash.

      The banquet’s participants ignore the faltering market because the rules are we never reveal the truth, or acknowledge it, or discuss it, no matter how obvious, because truth is fatal to fraud. So the stock market’s vital signs are in freefall but the conversation remains upbeat and light: stimulus, rapid growth in the second half, etc., all the patter of a carefully constructed illusion that fraud is forever as long as the truth never comes out.

      Alas, the truth has emerged from the shadows, despite the silence of the insiders and the financial media. Here are the truths that have emerged like karmic genies:

      1. The stock market is nothing but one giant fraud. The entire market is corrupt and rigged from the ground up. The fraud is systemic, designed into every tendril of the market. It was a useful deception to blame it all on “bad players,” but now the truth has been revealed: the market is nothing but a rigged game enriching insiders.

      2. The Fed is a fraud. All the Federal Reserve has accomplished in 13 years of goosing the stock market is unprecedented wealth and income inequality as the fraud of the Fed has boosted the fraud of the market, which has fatally undermined America’s social and economic orders. Please read this short paragraph and let it sink in. Monopoly Versus Democracy (Foreign Affairs):

      Ten percent of Americans now control 97 percent of all capital income in the country. Nearly half of the new income generated since the global financial crisis of 2008 has gone to the wealthiest one percent of U.S. citizens. The richest three Americans collectively have more wealth than the poorest 160 million Americans.

      Thanks to the tightly bound frauds of the Fed and markets, the bottom 90% of Americans own essentially zero capital that produces income and the vast majority of all income gains since 2008 has been siphoned off by the top 0.1% (see chart below from the New York Times.) Three monopolists own more wealth than half the nation’s citizens.

      Yet the fraudsters in the Fed laughably insist their policies haven’t created inequality on such a vast scale that is has destabilized the nation. The Fed’s credibility is zero, yet the financial media tiptoes around, proclaiming the glory of the Emperor’s illusory clothing.

      3. America’s system of governance is a fraud. What can we say when powerful politicians are worth over $100 million and are active participants in the most speculative excesses of the stock market, Buying More Than $1 Million In Tesla, Disney And Apple Calls In December? Do we even need to ask where their interests lie?

      What can we say about a regulatory system that immediately bails out the most corrupt and destructive financiers / speculators but stands aside when the public loses trillions of dollars? The financial regulatory system is a complete fraud, devoted to bailing out the biggest insiders while ignoring the losses of the bottom 99.9%. America’s financial regulations protect the corrupt, not the citizenry.

      4. The wealth effect is a fraud. The Fed’s entire fraudulent policy holds that if the stock market is goosed higher by Fed rigging, the phantom wealth handed to the top 0.1% will magically trickle down and benefit the bottom 90% who own no productive capital.

      There is no magic; the wealth effect is a fraud. If one $5 stock (GameStop) can be pushed up to $400 in a week, why not push every $5 stock to $400? This is the essence of the wealth effect: all capital is phantom capital, a fraud balloon awaiting a pin.

      The wealth effect failed, the Fed failed, regulations failed, politics failed. But thanks to the Fed and the self-serving political class, the entire U.S. economy is now utterly dependent on this completely corrupt and destabilizing fraud–the stock market. If the stock market stumbles and collapses, the economy–now totally dependent on phantom capital –also stumbles and collapses.

      It didn’t have to be this way, but this is the reality we must now face: truth is fatal to fraud, and our entire financial-political system is a fraud. The stock market is pale, and blood is seeping through the tuxedo, but the insiders, politicos and their toadies and apologists are nervously averting their gaze.

      The market’s bleeding but it can’t possibly die, can it? Yes it can, and yes it will: truth is fatal to fraud, and the truth has escaped and is now free. We can’t unsee what’s behind the curtain

      https://www.oftwominds.com/blogjan21/stocks-dead1-21.html

  6. This may, or may not, be off-topic.
    You decide?
    COVID-19
    This is a passionate monologue from LA Goth mortician, Caitlin Doughty.
    Boingboing.
    “Everyone’s favorite “death positive” Goth mortician, Caitlin Doughty, vents her spleen over the overwhelming number of COVID deaths her small LA funeral home and many others have been dealing with this winter.”
    “An LA mortician cries out over COVID corpses.”
    https://boingboing.net/2021/01/29/an-la-mortician-cries-out-over-covid-corpses.html
    Now? You still want to put profits before humanity?

  7. Eh, card carry member, of who dare say,S.U.P. where i who the fuck you.Ever asked or knowing you to be, course not,who,this lass is second term, no third,and yersel should understand not knowing,but why.

  8. I’ll spell it out for you all. labour, the Blairite and Grunter are hell bent on staying in power. The economy and a large recession is the only thing that could affect their chances in 2023 and 2026. Pumping the housing market through monetising debt was the only feasible outcome after covid put paid to the Asian immigration ponzi scheme. This is entirely planned and cynical electioneering and politics.

  9. NZ has abandoned it’s own citizens and left them out in the cold with ‘trickle down’ – our taxes now prop up abusers of the system.

    Just took them months to discover that those taking up MIQ places leave NZ immediately… despicable people who our government allows to abuse other citizens here with their trickle down focused rules.

    “National’s health spokesperson Chris Bishop said he was surprised that 12 people finished managed isolation and left the country immediately.”

    Government takes ‘dim view’ of people trying to game managed isolation
    https://www.stuff.co.nz/national/health/coronavirus/300218120/government-takes-dim-view-of-people-trying-to-game-managed-isolation

    Some of those applying for Kiwibuild housing could pay the $650,000 deposit in cash. KiwiBuild did not prioritise the needy or NZ citizens only but anybody resident here on student visas etc were able to pay cash for the houses – so how needy are they??? Meanwhile state housing waiting list is over 22,000. https://www.scoop.co.nz/stories/HL1906/S00035/kiwibuild-pre-approved-applicants-list-raises-questions.htm

    Our laws are geared towards ‘bums on seats’ and unethical behaviour to prosper within our population because our government never bothers to prioritise it’s own citizens born in NZ who they fucked over first with Rogernomics before giving any tom, dick or harry and especially rich pensioners from overseas millions of dollars of tax payers money for free pensions to other countries citizens, who their own countries don’t give pensions to.

    Lefties not only asleep at the wheel, but actively collaborating with the above practises.

    • It also shows there are no ‘safe’ Covid countries as people seem to easily be able to fool the world where they have been and can buy nationalities in other countries they don’t necessarily live in aka trying to work out the risks of South African strain vs Wuhan strain – they are both deadly but Russian roulette is the trickle down strategy.

      NZ so far has Covid under control but each day it gets more risky, aka the community case recently. We won’t know for 3 weeks the out come of that, or longer as Covid can pass it on with zero symptoms.

      Also had a friend tell me someone flew from India with Covid to Fiji with a connecting flight to NZ, but was discovered on the flight to have Covid in Fiji because he disclosed it. Just wipe out Pacific Islands. A lot of people were flying to OZ to get to NZ during the first wave of Covid. UK has not even closed it’s border yet.

      The world is a small place with many people with money in particular, gaming the system and infecting others and causing millions/billions dollars of hardship for people’s economies.

  10. Apparently foreign pensioners and they families are ‘outraged’ that they won’t get their free NZ pensions within 10 years and it’s proposed they wait for 20 years….

    China and India economics are much stronger than NZ, but their governments don’t give their workers free pensions and health care in their own countries, so no wonder as millions of dollars of freebies are currently available in NZ, driving huge demand (Asian pensioners in NZ are going to exceed Maori and Pacific Island pensioners in NZ very soon which is mind boggling, and they don’t have to pay a bean). Pensions are the biggest cost to government for social welfare in NZ so this is a MASSIVE fuck up.

    Meanwhile current Kiwi workers sleep in cars and Kiwi taxpayers are unlikely to get the same pensions as the money will be gone soon on foreign pensioners willingly given our Kiwi taxes by the ‘trickle down’ brigade.

    Public Health care in India is poor quality and most people don’t use it…

    “The Indian public health sector encompasses 18% of total outpatient care and 44% of total inpatient care.[10] Middle and upper class individuals living in India tend to use public healthcare less than those with a lower standard of living.[11] Additionally, women and the elderly are more likely to use public services.[11] The public health care system was originally developed in order to provide a means to healthcare access regardless of socioeconomic status or caste.[12] However, reliance on public and private healthcare sectors varies significantly between states. Several reasons are cited for relying on the private rather than public sector; the main reason at the national level is poor quality of care in the public sector, with more than 57% of households pointing to this as the reason for a preference for private health care.”

    https://en.wikipedia.org/wiki/Healthcare_in_India

    Public Health care in China is not free for urban nationals…

    “Residents of urban areas are not provided with free healthcare, and must either pay for treatment or purchase health insurance. The quality of hospitals varies. ”

    “Despite this, public health insurance generally only covers about half of medical costs, with the proportion lower for serious or chronic illnesses. Under the “Healthy China 2020″ initiative, China is currently undertaking an effort to cut healthcare costs, and the government requires that insurance will cover 70% of costs by the end of 2018”.

    https://en.wikipedia.org/wiki/Healthcare_in_China

    Chinese pensions…

    Guess what, in China you have to CONTRIBUTE minimum 15 years to get a pension and only get 1% of the indexed wage in China for your public pension.

    http://www.oecd.org/els/public-pensions/PAG2017-country-profile-China.pdf

    In India it sounds like no free public pension and minimum 10 Years of CONTRIBUTIONS of 12% and only 12% of the work force seemed covered for pensions anyway.
    http://www.oecd.org/els/public-pensions/PAG2017-country-profile-India.pdf

    In NZ you don’t have to contribute at all to a pension as an overseas person or be working, just be resident here for 10 years (used to be 5 years) to get 43 per cent of the NZ average wage and it is not means tested for overseas pensioners either.

    “To meet the residency requirements for New Zealand Superannuation, Veteran’s Pension (New Zealand pensions) and most New Zealand benefits, generally, you must:
    be lawfully resident, and
    be present, and
    be ordinarily resident in New Zealand, and
    have spent some time living in New Zealand (a period of residence).”

    https://www.workandincome.govt.nz/pensions/travelling-or-moving/moving-to-nz/residency-requirements-for-new-zealand-benefits-and-pensions.html

    Not surprising that NZ is now the place to retire to and be supported as an overseas resident as well as the free quality health care that many have to pay for in their own countries!

    Superannuation and health care was known about as a major issue a decade ago for our lazy immigration policy. Natz encouraged it, and Labour have just bought back migrant parent entry based on woke stupidity.

    • No. Everyone would die poor, there would be no wealth what so ever accumulating with the power of compound interest and nothing to pass on to children. Everyone who is not rich will die fighting to buy their coffins from the grave.

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