House prices and rents are through the roof and lots of people are sleeping rough. We have beggars on the streets of our towns and cities. Our hospitals, indeed our entire health system, is being kept running only through the hard overwork and selfless dedication of a truly remarkable health workforce. Literacy and numeracy levels have plunged from dizzy heights to abysmal depths in less than a decade. Inflation is running at levels not seen for thirty years, and is tipped to get worse.
On the bright side, unemployment is a mere three or four percent, so if you’re sleeping in your car but you haven’t got enough income to put our fabulously expensive petrol into the tank, you can get yourself a job and try to get yourself back on your feet thanks to the minimum wage, right?
Wrong. The powers that be have decided that the low level of unemployment is feeding the voracious beast of inflation by creating demand for increased wages. It’s not the war on Ukraine pushing up petrol and food prices, it’s not the effects of the pandemic which we are still going through. Hard-working New Zealanders and immigrants greedily demanding a decent wage in response to rapidly rising prices for everything are the cause of our monetary problems.
The solution according to the Reserve Bank? Throw more people out of work and create a recession. Let’s have more people sleeping on the streets. It’s hard on those poor folk who lose their jobs and housing, but it will cool the financial jets and bring inflation back to the fiscal nirvana of under three per cent, and isn’t that worth all the suffering that someone other than the Reserve Bank Governor will go through? I’m quite sure that the next person to freeze to death under a bridge will be happy to know that he or she is contributing to the financial goals of the Reserve Bank.
What is wrong with a system in which such a solution can seem like a reasonable option? A system that punishes those with the least and pampers those with the most.
Honestly, how stupid was the question if this is the answer? It’s time we took a long hard look at our economic priorities and asked whose interests they are serving. The economy is not some divinely ordained machine that we all must bow to. Quite the reverse. It’s a human construct and therefore subject to human control. If the economy is not serving us – and by ‘us’, I mean the vast majority of us – then we need to restructure it so that it does.
Why do we need to have people sleeping on the streets and begging there when they wake up? How does that sit alongside a tiny privileged class of CEOs who earn millions of dollars in salaries – far more than most of us could even manage to spend. How come they keep getting tax cuts, bonuses and pay rises while our health system is desperately short of funds to keep people alive, and those of us lucky enough to have jobs keep seeing our wages dwindling in the face of higher prices?
Perhaps we should take a lesson from ancient history, the most apposite example appearing in the fall of the Roman empire:
As I see it, the Roman political system facilitated a most intense and ultimately destructive economic exploitation of the great mass of the people, whether slave or free, and it made radical reform impossible. The result was that the propertied class, the men of real wealth, who had deliberately created the system for their own benefit, drained the life-blood from their world and thus destroyed Greco-Roman civilization over a large part of the empire … If I were in search of a metaphor to describe the great and growing concentration of wealth in the hands of the upper classes, I would not incline to anything so innocent and so automatic as drainage: I should want to think in terms of something much more purposive and deliberate – perhaps the vampire bat.
-
- G. E. M. De Sainte Croix – The Class Struggle in the Ancient World.
David Jones is a retired orchard hand living in the Tasman district.
David Jones is a retired orchard hand that demonstrates clearly that he has the economic knowledge of a retired orchard hand.
Labour allowed the inflation genie out of the bottle by crashing the real economy and spending like Nicholas Cage on speed.
Unless that genie is out back in the bottle, then the real losers will once again be the poorest among us.
So in other words by trying (or pretending?) to be kind without the most basic understanding of macroeconomics, Labour have forced Orr’s hand.
Does he need to hike rates with such vigor? I’m not sure, but they most definitely need to be hiked.
A correction to your first paragraph: David Jones is a retired orchard hand, therefore we clearly have no idea what the extent of his economic knowledge is.
Well said. Retired orchard hands may or may not have more economic credibility than our current Reserve Bank Governor.
David is entitled to his view & there is no reason to relate his economic knowledge to any occupation since he does not provide a history of his life. One could suggest that your memory is limited as well since Martyn has repeatedly mentioned the trillions of dollars created since the GFC was the ultimate cause of our current problems. It is easy to claim that Labour crashed the economy but you neglect to offer any other options they could have followed when the world shut down for covid.
Ditto, attack what he is saying not the man saying it, this is so pathetic. I know labourers who have great intelligence, the job you do does not define your intelligence.
So let’s have retired orchard hands run the banking system. it could not be less competent than how it is being run, from the sublime to the ridiculous monetary policy within a few months. Printing money like there was no tomorrow last year and running close to zero interest rates to destroying the lives of all those except the speculators that had responded to the promise of a home of their own at a massively inflated price just to be ruined by a change of sentiment by the incompetence and the ideology of those in charge. Or who pretend they are in charge, though clearly they are in charge of nothing. The neoliberal madness will take it’s course to collapse whatever they do. And David Jones has as good a grasp of the situation as anyone.
D J S
So Labour crashed the US economy, Uk economy, etc? This is a global failing – look outside our teeny country.
Why is it everyone just attacks Labour lately?
They’re all responsible for this BS.
Doesnt matter what govt you elect here life never changes down the bottom while the rich just get richer.
Jays assumes that lowly workers can’t possibly have a grasp of economic matters. That’s despite the orthodox economic experts having crashed pretty much every economy they have ever meddled with. I think it’s time we lowly workers had a go at running the economy. At least if we run it in our own self interest, that’s the interests of the vast majority taken care of.
Since the government(of all shades) took over the role of Mummy in the 1970s (ie start of welfareism)
and consistently increased the kids pocket money and not expecting them to do the chores. The kids have become very lazy in looking after themselves.
The role of the traditional family has been diminish significantly.
No corrective smacks, locked in bedroom time (not locking up crims)
No shouting at children, letting them abuse/disrespect their elders. (Liberalism gone mad)
Jamming beliefs into kids that dont align with traditional family values. (you poor thing sentencing BS)
Combine that with the screaming hordes blaming the government.
The government should do something!!!!
Ever seen a real skinny beggar in NZ. Yep, thought not.
You do follow the agencies that go around and night and offer those sleeping on the streets a place to stay(offers most time rejected)
So rather than just throw money around apropos current and previous Governments.
How about the Government steps back from being a Mummy, they are doing a pathetic job.
PS. I am saddened about what has happened in my country.
Yes, I shout and abuse beggars, especially the fat ones.
I have offerd a bedroom to kids sleeping on the street, generally get abused (fk off grandad)
Where’s the leadership. Cant see any leaders in our political circles. Just pathetic wokests trying to appease minorities in some vague hope they will get elected.
Rant over
Thanks Bomber
so your solution is ‘let them eat cake’ basically re?
Did you mean the start of solo parent welfare? The old age pensions act started in 1898 & various additions happened since then.
You’re on to it Ra!
Well said
So Ra you think we should still hit kids to teach them things. Appalling attitude.
Jeepers you shout and abuse beggars.
If we’re serious about a long-term reduction in “child poverdy”, difficult conversations need to be had about the DPB.
Welfarism started with the Mummy State in the 70’s? On the contrary, that’s when the welfare state – which had made New Zealand so prosperous from the late 1800s (under the Liberal Government) and the 1930s (the 1st Labour Government) – began to be dismantled and the neo liberal agenda began to be introduced. What that whole period (up to the 1970s) of increasing prosperity, coupled with increasing welfarism demonstrates clearly is that if a government looks after the ordinary people, the whole country – including the business community – prospers. If the rich end up in charge and they start taking money away from the poor, we all end up much worse off.
I think he means the DPB, which began (I think) in 1974.
I do not agree that Reserve bank should penalize general public by increasing interest rates. The global supply chains and war in Ukraine are partly to blame for inflation. However, ineffective govt spending and loose fiscal policy created the biggest increase in house prices, which will now lead to increased rental and mortgagee sale if the interest rates keep going up.
That final paragraph was about graham hart right? He can smell money apparently. I can smell is a rat.
Stuff.
‘You can smell where the money is’: Graeme Hart and his innate sense of commerce
“I always have loved business, going right back then,” he says. “I can pretty much track my career in terms of the moves that I’ve made from the day I signed up to be an apprentice panel beater and how quickly I decided – hey, that’s a bad value equation, you should get out of that.”
Hart says he has been blessed with a very strong sense of commercial acumen.
“I’ve got an absolute passion for it.”
https://www.stuff.co.nz/business/128825629/you-can-smell-where-the-money-is-graeme-hart-and-his-innate-sense-of-commerce
Missed out the real money shot!
Public asset sold to him for peanuts=Govt Printing Office-sold for 1 years t.o.
Lange would not sign it off so a Douglas acolyte did the deed.
Same as a couple of others on the rich list-Fay Richwhite,Gibbs.
Reform of the private bankers debt servitude banking system is what is required.
Real productivity,real goods and a currency based on that,rather than the farcical papershuffling of modern,monetary theory that manipulates economies to benefit a tiny sector of…society.
David needs to explain all this to Ormsby Corp. Not us….The have been running the show for a couple of years now , but for some reason they seem to be distracted from the realities of Rogernomics that our own good old Labour Party inflicted on us. One could wonder what sort of distraction would keep them from helping the kiwi battlers of society…??
Don’t worry, the Reserve Bank have done their research and have established that the average Kiwi is OK with increasing unemployment if it brings the inflation rate down.
Try to think of them as numbers, not people, it’s easier that way, besides your job is safe, isn’t it? And we all have to make sacrifices, don’t we? The Reserve Bank just happens to choose to sacrifice you.
Shift the responsibility of inflation from the planned recession, which would mean lost jobs and less tax revenue for the government, and then more debt down the track, to the wealthy and to the sharemarket.
Introduce a wealth tax on all shares. Yes. Every share in every publicly listed company in this country would be obligated to pay the government, in cash, a one-off flat rate of fifteen percent. Shares held in trust on behalf of individuals enrolled in the KiwiSaver scheme would be the only exemption. Serves everyone right as we don’t have capital gains tax applicable to the sale of shares in this country.
This avoids the recession. It avoids redundancies. It keeps the government happy with having revenue that it would otherwise not have, and the government in turn could increase the health budget, or the education budget, or to fund tax cuts, whatever really.
The alternative to this, is this planned recession spurred on by Adrian Orr. And then we will all lose out AGAIN
Bring back the gold standard? I hope depositor insurance comes in soon. I forget the name used in NZ for it. Where govt guarantees savings deposits up to $XX (was it $50K or $200K?). It was slated to become law in a year or two. Otherwise watch our kiwisaver accounts and savings get wiped out when the worlds entire financial system breaks down early to mid next year. Worse case scenario. It’s tipped another major USA Bank will fail next year (untraditional sources so take with a grain of salt). Yay capitalism (sarc). Another black swan event is no doubt on the horizon. JMO
I would trust a orchard hand over a wellington bureaucrat any day. Real life is terrestrial, not lived in ivory towers. Look around Auckland, and tell me that the system is not still fucking us. Colonial racist bigotted institutions, some attempting to decolonise, but with so many social issues, progress is slow. Progress plus evolution will bring the radical revolution required to save us from ourselves and The Economy. The economy, like god, is a human creation. It should serve humans. It currently, and always has, functioned excellently for the 0.01%, but surely the majority (99.99%) deserves equal part of the gluten free soy latte?
I think in years to come you will see civil unrest in response to how our economy operates and who it serves. I know the powers that be and those doing very well out if this system will feel very uncomfortable with this. But it’s historic and how change has occurred over the centuries. ‘ When people lose everything and they have nothing left to lose’.
Most people do not care to realize that the economy, therefore the stewards of the economy, the political class, no longer works for them. And one reason for their lack of awareness is another key component of society that is no longer working for them – mainstream media. Henceforth, you can’t restructure when most people don’t see a problem, or in this case, two problems (the economy and its stewards and the lack of awareness purposely brought about by owners of media that greatly benefit from problem number one).
Thus, if we wish to restructure or revolutionize or challenge the corridors of power in any way, we need to be aware…..
The solution isn’t more of the same or more tinkering. It’s whole sale change to the system. No more neoliberalism.
Structural change is needed.
Start with Governance by referendum.