Greens’ Chloe Swarbrick calls for economic response inquiry
The Greens want a select committee inquiry into the economic response to the Covid-19 pandemic.
Finance spokeswoman Chlöe Swarbrick has written to Parliament’s Finance and Expenditure Committee, calling on it to agree to an inquiry into the Covid-19 economic response when it meets for the first time this year on Wednesday.
The Greens have been critical of aspects of the Covid-19 economic response, in the Government’s reliance on the Reserve Bank’s lowering of interest rates to boost demand in the economy. This had the unwanted side-effect of pushing up house prices across the country.
FINALLY!
After all the bullshit middle class identity politics posturing, we FINALLY get to the crux of the matter.
The terrible failure of neoliberal economics and it’s horrific impact on the vast majority of us!
Jacinda and Grant poured billions into the housing market and the housing market exploded. They used failed free market dynamics in a market already mutated beyond recognition by free market dynamics and it has resulted in one of the largest transfers of wealth in NZ history…
Wealthy nearly $1 trillion richer since Covid began – Hickey
An economic and political commentator says since the Covid-19 pandemic reached Aotearoa, the rich have become richer and the poor have become poorer – in part due to the Government’s policies.
Bernard Hickey, writing in The Kākā newsletter, argued that – contrary to many assumptions – New Zealand’s economic response to Covid-19 was among the worst in the world in terms of widening wealth inequality and being a wasteful use of taxpayer funds.
He calculated policies like cash payments for businesses struggling through the pandemic, wage subsidies that saved business owners money, rising property and asset prices, and money printing cumulated to make the wealthy nearly $1 trillion richer.
Meanwhile, the lines for emergency food parcels continue to lengthen, Hickey told Breakfast.
…I’ve argued Chloe is the mustard, here is her speech in Parliament…
“We’ve seen those distributional impacts in house prices rising $300,000 on average across Aotearoa, we’ve seen it in the 1 trillion dollar estimated transfer of wealth to the wealthiest New Zealanders. The government has seen that increase in inequality not though some ‘natural process’ but as a result of decisions that were made, and decisions that were not made.”
…we desperately need a new economics, reviewing the vast failures of the current life boat is an essential start.
This is Chloe’s moment.
All strength to her arm, it’s a debate that needs urgent attention as global capitalism once again looks on the verge of collapse.
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“we’ve seen it in the 1 trillion dollar estimated transfer of wealth to the wealthiest New Zealanders.”
That is patently absurd. Where did the trillion dollars come from? Not the poor for they never had that volume of wealth. That trillion dollars is nothing but paper value that cannot be liquidated into disposable currency for distribution.
As that “wealth” is but paper entries on an accountant’s spreadsheet, the state cannot liquidate that trillion dollars and “distribute” it to the poor. The trillion dollar wealth is an illusion.
But it suits an agenda to claim that the wealthy have increased their “wealth” when all that has been done is increase the illusion the wealth is real. It is not real. It is a paper value and meaningless in the tradable economy.
The agenda being is the creation of a wealth tax. A tax based on paper value (an arbitrary value set by the state) of any asset, to make a wealth tax seem a doable proposition. When in fact it will do nothing to distribute real currency to the poor.
Only accountants and an army of more state servants will get more work and income, the poor will get not even the crumbs from the illusion.
Do politicians actually know the difference between real value of assets and paper ones? Do politicians know how the create tradable value from any asset?
The house I live in has increased in “value” over the last few years by $1,000,000 here in South Auckland. On paper am a millionaire but my “wealth” is an illusion, Unless I sell, I cannot transfer that “wealth” into food on the table plus keep a roof over my head. You will find the same with the wealth tax. It will not help the poor.
To help the poor, the state needs to make investment into job creation private (as in paying taxes for distribution to the poor) enterprises to flourish. Something this Labour government, supported by the Greens, cannot get the heads around.
They see the tax paying tradable private enterprise sector as the enemy to be milked dry. And doing a good job of it. But once the taxable cow is dry, how will they fertilse it again to give the milk for next years taxable real currency income. The taxes needed for currency distribution to the poor?
I hate to dim the flicker of hope but Chloe could be the second coming of the Virgin Mary but it ain’t going to change these turkeys one iota.
Labour have firmly established their government as a government of the establishment. Robertson wants a housing crisis because it enhances the paper wealth of home owners. Jacinda is happy to sell that dead rat to the public. No other interpretation can be drawn, we are into year 5 of this government and everything they have done has been too enrich home owners, especially multiple home owners at the expense of non owners. What a nightmare.
Not last week Jacinda was telling us the state house rebuild was going at “an incredible rate”. Ahhm, no it isn’t. She made John Key look honest!
She told parliament that Labour are “pulling levers” in respect of housing. If Jacinda meant to accelerate inequity, unaffordability and ruin, then yes they are. Massively. But I suspect that wasn’t what she was trying to convey.
Chloe has said what is true but her party are a party to everything awful thing Labour have done so it’s a bit rich and very late to criticise from the sidelines when you’ve been in the game in looking the other way.
“…we desperately need a new economics, reviewing the vast failures of the current life boat is an essential start”.
You not wrong Martyn, on the first premise. But another review? Oh come on! Revolution, my boy! At the very least, a commitment to meaningful and lasting transformation. Is Chloe and her mob up for it?
In some areas this government has done a good job in relatively uncharted waters of the covid effect but the economic responses shows their lack of perception and the real life outcome of their moves . They developed a two tier welfare system which left many well paid people not knowing the true effect of being on the normal welfare rather than the false one created for those initially effected by covid . They may be call Labour but the MPs seem to have no knowledge of surviving on struggle street or not white elite.
As with their treatment of Maori once you scratch away the thin veneer their effort to advance their cause is small despite the words spoken . The naivety of this government is shown in the botched attempt at controlling lending and not realizing the effect of the rules and how they translate in real life.
Some years ago the phenomenon of Governments using a public emergency situation to obscure massive transfers of wealth to the already stinking rich, was known as “Disaster Capitalism”.
So this is COVID Capitalism perhaps. Good on Ms Swarbrick for giving it a go, there is ample evidence. But who will support the fight? Luxury Luxon with his 7 pads is unlikely to, ditto ACT. Those with one or more houses will likely just sit there saying nothing–“it wasn’t me…”
So the Greens should try and enlist public support in the form of new Gen voters–who do not have even one house or are likely to get one! And Te Parti Māori should get in on this too on behalf of its alienated and discarded constituency.
The Govt.had enough $$ to set up a Basic Income trial for the duration of COVID and to implement the whole WEAG Report immediately, they could have set up free Wifi to overcome the digital divide, free public transport–you name it–but they chose to blow out the housing market and increase inequality.
Before some of you right wing dogs that have slipped your collars from Kiwiblog or somewhere, start, remember the Natzos and ACT would have done even worse and will not remotely solve inequality in Aotearoa NZ
More ‘select committees’…. and seems Greens are more against the governments Covid response than for it. Tired of the woke helping the right wingers pushing the anti vaxx, anti lockdown agenda against one of the most successful in terms of loss of lives and spread in the world. Labour
Meanwhile average Joe’s power is on the increase due to billionaire polluters in NZ. Nothing from the greens, in fact they help the polluters with their carbon ETS cost containment reserve. That means the taxpayers pay when carbon prices rises as they have been doing, thus polluters in NZ don’t have to worry about reducing their emissions here as their contribution is topped out at a low, low fixed (by government) carbon price.
Funny enough Rio Tinto sounds like is not going to leave NZ now.
By raising the possibility of staying past 2024, Rio Tinto has thrown a wrench of uncertainty into decarbonisation pathways and power company construction plans, Marc Daalder reports
https://www.newsroom.co.nz/smelters-will-they-wont-they-dance-grates-on-govt
FFS – Rio Tinto was never going to leave, as NZ produces some of the best aluminium in the world. No other government so stupid and so keen for corporate welfare than NZ! Thanks Gweens.
NZ power consumers and taxpayers have been subsidising Rio Tinto for decades now. In some calculations something like 25% of all consumers power bills is caused by Rio Tinto subsidies and power use.
Just when we thought they would finally go, they decide to stay.
Why does our government think that 30 million in power subsidies every few years to rich polluting corporates is ok, and then somehow allow themselves to be held to random for a few thousand jobs when on the other hand they make it so easy to make hundreds of thousands redundant and never support environmental initiatives?
Rio Tinto pollute and taxpayers have to clean that up too!
Rio Tinto waste – just throw your hazardous waste in the local towns – years of meetings, no action.
https://www.odt.co.nz/regions/southland/mataura-asks-govt-act
https://www.youtube.com/watch?v=sI_LjMsr8gU
Now the carbon ETS cost containment reserve, thanks for destroying the planet and NZ with these right wing, woke agenda, Gweens.
Have to applaud Chloe for addressing the elephant in the room that nobody wants to talk about.
The diabolical inequity that has increased dramatically in recent years is by far the biggest failing of the Ardern Government. How can any Government that has a history of supporting blue collar workers stand by talking fluff and catchy slogans while this carnage worsens month after month?
I put it down to the following.
1) Totally unrealistic housing goals / targets from an idealistic and clueless bunch in Labour leading up to the 2017 election that were later brutally exposed while in Office. A place incidentally none of them expected to be at that time. Should we blame Ardern? She will have been in the room but that fantasy policy was formulated under Andrew Little and there was not much Ardern could do about it a few weeks out from election day when the leadership baton finally changed.
2) Choosing eggplants like Phil Twyford and Megan Woods to resolve the crisis. Neither of them should ever be in charge of pet hamsters let alone a housing crisis FFS.
3) Ardern had every one of her eggs in one basket to tackle the shameful inequity in housing. The Capital Gains Tax. Her Government naively didn’t budget on the well funded anti CGT fearmongering vested interest campaign that would inevitably unfold. This clearly unnerved Ardern and Winston Peters even more so. Had Ardern not taken the threat from Peters so seriously to bring the Government down had they implemented a CGT, it would already be in place and we wouldn’t have the diabolical inequity we now have. Ardern treated the all-important CGT like a close relative that had just been convicted as a child molester. She wanted to distant herself as far away from the CGT as possible. Not only was it gone, she said but it would never return as long as she was PM. She had just binned the best weapon she had to combat the housing crisis. Was she right to take such drastic action? I say yes but with the benefit of hindsight, she should have just put it on the back burner until the next election. Having said that, she had no clue at the time that Covid was on it’s way and what that would do to our housing market. I believe Winston Peters more than any other politician created the housing inequity we now have. I hope people remember that when he tries to get his nose back in the trough come 2023. The biggest blunder Ardern made was not having a Plan B. All she has finally has done since was to tinker around the edges. It was way too little way too late for that. Any dropping of house prices that eventually unfolds will have virtually zero to do with anything Ardern has done.
4) The biggest problem Ardern has had since is the hopeless paradox she’s put herself in that has left her paralyzed and unable to make any progress. She wants housing to be more affordable …..but is extremely fearful of house prices dropping due to the implications. She does NOT want house prices to drop. As a result, her chances of success at getting on top of the housing crisis is somewhere between a 0% and 1.3%. In other words, the best case scenario is a 98.7% chance of failure.
5) Conclusion. Both the National and Labour Governments have conclusively proven over 13 years they are either incapable or unwilling to resolve the housing crisis. As a result, anything both say should be treated with the contempt it deserves. The best hope we have of resolving the housing crisis is not political.
I actually like and respect our PM. She’s a very intelligent and lovely person. Anyone who can’t see that is either, blind, stupid or letting political bias rule their perspective on her. I just don’t respect some of her policies, especially on housing.
As a completely irrelevant aside, I’d like to share something with you.
My wife said something very interesting about the PM a few days ago. My lady has a lot of experience in the field of pediatrics. She feels the PM is pregnant at this time. I have no real understanding how she came to that conclusion but she has. I will watch this space as all of my wife’s colleagues consider her the go-to person in areas similar to this due to her experience.
Thinking Man;”…implemented a CGT, it would already be in place and we wouldn’t have the diabolical inequity we now have.”
The whole point of a CGT is to raise money for redistribution and flatten the house price curve. The two are quite contradictory. If you want to raise currency for redistribution you absolutely have to have asset prices trending upwards. You cant raise realise a CGT in a falling market. However that instigation of a CGT should have been done under Helen Clark’s 9 year reign. To late now.
Hence I feel that Labour is so lost, they want to flatten the house price curve, but having done so, the raising of a CGT will not gardener any income. So no point and politically a lead balloon.
The time to start a CGT is at the beginning of a price hike, not at the end of one.
Expecting Labour to organise a “valuation Day” for all potential capital gaining assets, I would suggest, is totally beyond them. By the time they got the database set up it would be out of date.
I think you are right Ardern will not last this year out. I doubt pregnancy but some other domestic upheaval.
Gerrit,
Solid input.
Lol. The inflation horse has bolted. A mild cold for 99% of the population will be the least of our worries by August. Will our dear leader stay when the tide is truely going out?
By the end of the year Jacinda will be looking up that number Aunt Helen gave her for a nice job at the U N
Trevor, how many ex P.M.’s have taken overseas posts?
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