Are you gasping in shock at the venal greed of NZs neoliberal low wage free market economy yet?
One thing the Covid shut down exposed was the lies of the free market globalists. Without their ability to exploit migrant labour, NZs unemployment rate has plunged and workers are finally in a position demanding better wages and conditions.
Economically this country is built upon two essential pillars, stealing land from Māori and never paying it back and exploiting low wage migrant labour.
Are you horrified yet at how the elites are promising higher unemployment to solve the inflation madness they helped spark?
Are you horrified how the Aussie Banks can keep profit gouging us?
Are you horrified at how addicted NZ is to a low wage economy?
The issue isn’t high migration, the issue is that neither National or Labour spent enough on infrastructure to keep up with the huge migration game.
It creates fake growth which in turn causes social friction as the domestic working class are pitted against cheaper migrant labour.
We are not an over taxed, over regulated economy!
Our top tax rate is the 39th highest in the world behind all the Scandinavian countries plus Germany, the United Kingdom, Ireland, France and South Africa!
Australia’s top tax rate is 47cents!
Our GST rate doesn’t even get us into the top 50 and our corporate tax rate is 40th while Government spending against GDP ranks 56th!
And we are voted easiest to do business by the World Bank!
We are addicted to a low wage economy because 30 years of neoliberalism has gutted the union movement.
We are so addicted to a low wage economy that we will risk triggering a spike in unemployment to capitulate to big industry who are reliant on cheap labour.
This will see unemployment rise as big industry dump Kiwi workers for their cheaper imports and we will see the impact of this next year as the recession kicks off.
To inoculate the country against these dynamics, we urgently need the Fair Pay Agreements to ensure the imported workforce are unionised.
Meanwhile, Adrian has kindly explained that he needs to burn New Zealand to save New Zealand…
Adrian Orr: Beating inflation will mean higher unemployment
“Of critical importance to overall financial stability will be the robustness of the labour market.”
Orr warned that the interest rate hikes needed to beat inflation would mean higher unemployment.
“Returning to low inflation will, in the near-term, constrain employment growth and lead to a rise in unemployment,” he said.
“The actual extent of this trade-off remains unclear, however, given the significant labour shortages globally and the very different means of employment being adopted post-Covid.”
“Importantly, it is highly unlikely that we are at maximum sustainable employment if inflation is still high and variable,” he said.
…cough.
What if he’s wrong?
I don’t mean about needing to destroy jobs and raise unemployment rates by rapidly lifting the OCR, oh he’s going to do that, he’s clearly telling the well heeled part of town that he intends to keep raising the OCR and that he is openly accepting the collateral damage of job loses, I mean what if he’s wrong about why inflation is going up and is giving the economy the wrong medicine?
The argument is that if the OCR rises, inflation will fall because jobs will be lost and those losing jobs stop spending, thus demand is allowed to ease which is supposed to lower prices.
So far, so Keynesian.
But what if this is a unique moment of crisis in Capitalism?
What if there is a price to pay for printing $25Trillion and artificially lowering the interest rate to the lowest rate in 5000 years?
What if that tsunami of inflation was distributed to the deepest, darkest most de-unionised supply chains in China and that Covid and geopolitical tensions have snapped free market just in time supply chains to just in case supply chains which sharply import inflation?
What happens if job losses explode AND inflation continues to climb?
What if the global supply chains that have kept the tsunami of hyper inflationary pressures away from the West have actually ruptured?
What if all the Keynesian macro economic advice is worthless because of the extreme global debt and sudden importing of inflation back to the West eradicates all that previous inflation suppression?
What if lowered demand still sees prices climb because there is a tectonic realignment in supply chains?
What if Orr’s medicine can’t cure the symptoms because he’s misreading the disease?
I’m not looking for socialism here folks, just basic garden variety regulated capitalism!
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Well Orr and the Jacindas Labour government have turned housing around for the better after National house ponzi scheme of 9 years. Congratulations to them. Now watch out for the usual naysayers to proclaim that they weren’t responsible for the correction…
https://www.msn.com/en-nz/news/national/double-digit-house-market-declines-in-main-centres-new-figures-show/ar-AA13SmpQ?ocid=msedgntp&cvid=1ed3f2e3b5164af7a0199ad24a73371c
Labeen were more popular when they stopped immigration during Covid. But they couldn’t help themselves and now have the highest immigration NZ has ever seen mostly family members, surprise, surprise they now are falling in the polls! It’s a train to Dimwits!
“A total of 165,000 residents visas were expected to be granted under the scheme which was announced by Immigration Minister Kris Faafoi in September, comprising 110,000 migrant workers and about 55,000 dependent family members.
https://www.stuff.co.nz/business/128282098/nz-may-get-60000-more-migrants-than-forecast-under-visa-scheme-says-national
But the number of dependent family members who have applied for visas under the scheme appears to have significantly exceeded government forecasts.
Carolyn Tremain, chief executive of the Ministry of Business, Innovation and Employment (MBIE), told a select committee on Wednesday that just under 87,000 applications covering a total of more than 170,000 prospective residents had been received to date.”
+++ As soon as these people get permanent residency we all know they will go to OZ for higher wages, but the dependants often stay in NZ due to all our free care they don’t qualify for in OZ++++
‘ comprising 110,000 migrant workers and about 55,000 dependent family members.’
‘Dependent’…..old couple at WINZ….’son run away to Australia and leave us….no money…what can…do’?
Blazer, that was what they were expecting but instead the amount of dependants is vastly is over the applicants aka
“on Wednesday that just under 87,000 applications covering a total of more than 170,000 prospective residents”
That’s 87,000 applications but 83,000 dependants!
Nearly as many dependants who will need education, health care, welfare, pensions etc than applicants who mostly were on very low wages themselves like bakers assistants on minimum wages!
Apparently the the nurses and doctors are on contracts so they didn’t meet the criteria. The pizza workers and families did.
There is a plethora visas now pushing as many people onto NZ health, welfare, justice, fakes jobs, as they can muster. They even are bringing back the aged pensioner category, so that Kiwi taxpayers can support more foreign pensioners.
The pensioners children can be on minimum wages to sponsor in their parents as they can all group together and get them into NZ, even the Natz eventually had to stop the category and had higher incomes that drew on it.
It is crazy the free money and services NZ gives away while making it hard for citizens to access timely services and now it’s ok that our kids grow up in grotty motels and found dead in burnt out cars here!
Martyn totally agree with you. Hence do you agree that Adrian Orr should have been reappointed for 5 years???
It was a crazy Labour policy to make Orr responsible for both holding inflation and keeping the unemployed low . It is hard to do both at the same time and so neither goals are met . I am sure this was done so the blame for fail of the economy falls on his shoulders and the pay back is a renewal of his contract for the next 5 years. If National get into power and dismiss him there will be a nice golden handshake .
Well you need to look for socialism Bomber because capitalism cannot restore profitable growth when the world is crashing to the bottom. It’s a terminal crisis. So we get permanent stagflation (call if whatever) with no solution unless we take over running the whole shebang and build a new society where growth is based on what we need not on making profits. Everything else is the mass delusion that is the last thing we remember…
There has been some incredible work on behalf of labour ministers that has gone in to state housing in recent times. Jacinda Arden has accomplished a lot, and I feel that Jacinda does deserve a third term although why she’s not too tired and why she intends to campaign for a third term are beyond me, but I feel we have a suitable candidate here whereas I do not have that same sense with Chris Luxon.
“The cost of living is too high here in comparison to the salaries,” one survey respondent from Botswana said.”
100% pure rip-off? New Zealand voted second-worst place to move to
https://www.theguardian.com/world/2022/jul/14/100-pure-rip-off-new-zealand-voted-second-worst-place-to-move-to
How pay rates affected Essential Skills Work Visas
https://www.immigration.govt.nz/new-zealand-visas/apply-for-a-visa/tools-and-information/work-and-employment/employment-skill-bands/employment-skill-bands-for-essential-skills-work-visas
“If you applied for your visa on or after 27 July 2020 for work paying below the median wage, you can support:
visitor visas for partners
visitor or student visas for dependent children, as long as you meet the minimum income requirement, which is currently NZD $43,322.76 a year.
NZD $43,322.76 a year!!!!! With a partner and dependant children!!!!!!! Importing in mass poverty and dissatisfaction of hundreds of thousands of visas at a time is the NZ way!
Lowering everyone else’s wages by having an unlimited amount of people able to come into NZ with dependants on the back of one person receiving NZD $43,322.76 a year.
The so called ‘free market’ does not exist and never has.
When Capitalism is failing it’s time for…War.
New Zealand will vote for economic cures the equivalent of medieval treatments involving copious amounts of of quicksilver, leeches, hot irons and hand-waving spells.
Because, you know, the woke are coming.
I generally agree with Martyn’s post above.
To this:
“Economically this country is built upon two essential pillars, stealing land from Māori and never paying it back and exploiting low wage migrant labour.”
I would add that NZ has, from the getgo of European 19th century immigration, exploited and extracted resources from women’s low paid, unpaid, and reproductive labour.
The legacy of this is still seen in the demonisation of single mothers on benefits, in the relative low pay, over-work and exploitation of people in jobs predominantly done by women (eg nurses in all areas of health care, like hospitals, aged care, and mental health nursing) and the under-employment, and precarious situation of people in part time employment – a high proportion of them being women.
And I am looking for socialism as the only way for our precarious future.
Something is wrong with government priorities. Biggest whinners seem to win in NZ. Another billionaire golf course run by minimum waged migrants, perhaps?
$20 million in funding to help address loss and damage caused by climate change in developing countries.
https://thedailyblog.co.nz/2022/11/09/copout27-nz-has-to-give-poor-countries-20m-to-deal-with-catastrophic-climate-change-because-we-are-cowards/
$54 million Innovation Programme for Tourism Recovery
https://www.nzherald.co.nz/travel/new-zealand-opens-54-million-innovation-programme-for-tourism-recovery/3U6JCVNRNQ7Y4H6BTXFQYCNIDE/
White collar criminal s dominant every major industry, that’s why u need regulating of capitalism
“To inoculate the country against these dynamics, we urgently need the Fair Pay Agreements to ensure the imported workforce are unionised.”
Yes there is big need to inoculate that existing migrant workforce against accepting low wages and crap conditions, although many unionists may simply see migrants as a market expansion opportunity because otherwise why wouldn’t they be speaking out against over-immigration. Why wouldnt unionists be speaking up on behalf of the 145,000 unemployed kiwis? Sure the unemployed pay no union dues but low wage migration suppresses wage relativity throughout the economy.
Do NZ migrants to China or India qualify for unemployment benefit or pension or superannuation?
Do NZ migrants to China or India get to import their older generation relatives free of charge and get them a free benefit of geriatic health care?
Its been this way for a long, long time and yet all you have to offer are band aids. Whose side are you on…because band aids serve the architects of this b/s system, and not us, or we, the people!
The problem is simple – the political class serves the powerful and not the people. Do something about that or shut the f up!
“The argument is that if the OCR rises, inflation will fall because jobs will be lost and those losing jobs stop spending, thus demand is allowed to ease which is supposed to lower prices.
So far, so Keynesian.”
Martyn, really enjoy your work and the excellent banter on The Working Group podcast. However, this is absolutely NOT Keynesian. It is monetarist nonsense and a perversion of Bill Phillips’ work (which he repudiated when he found out how the econs wanted to use it) which puts the macroeconomy in the hands of monetary policy – ie, carpet bombing to weed the garden.
Keynes had a far better working theory of the macroeconomy centred on fiscal policy and aggregate demand, the best example of which was the use of war bonds and tax in WW2 to control inflation.