Cautious Grant commits to largest debt ceiling in NZ political history and no one notices why
Why the young need an even higher debt ceiling
After 30 years of living in a budgetary straitjacket that squeezed infrastructure spending down into a $104 billion deficit, Labour’s Finance and Infrastructure Minister Grant Robertson is finally releasing a few of the shackles so governments of both flavours can start catching up in the longer term.
The bigger question is whether Robertson’s new net public debt ceiling of 30 percent of GDP, which is effectively 30 percentage points higher than that restrictive older one, is enough to both fill the deficit and deal with another 30 years of population growth in a way that improves housing affordability and reduces climate emissions.
By taking Crown assets like the NZ Super Fund, and liabilities like the debt held by Kainga Ora, Grant has managed to leverage our debt ceiling up.
By simply allowing our debt ceiling to grow, Grant manages to continue Government spending without raising taxes while keeping the rainy day money at the ready.
And that is what most commentators are missing.
Robertson is one of the most cautious Minister’s of Finance Labour have ever had, who is always shooting left wing ideas to stop populist left economics from ever spooking Treasury.
His pact with the Wellington Bureaucracy is that he is the trusted pair of hands who won’t ever allow neoliberalism to be challenged beyond the most broad of measurements (the well being budget).
Labour have been stung by the simple fact that their Covid response to date has enriched the wealthiest NZers by $1Trillion and this represents the largest transfer of wealth in NZs history. The pittance Labour have given to the poor while pricing homeownership out of entire generations of Kiwis is causing electoral stresses. Labour have plummeted in the Polls because the poor have lost faith in Jacinda’s transformative neokindness.
The broader she smiles, the more she tilts her head to one side and nods empathetically, the more they feel betrayed as the costs of living crisis swallows their hopes for a better tomorrow up whole.
Grant looks like he’s loosening up the purse strings but has zero intention of spending that purse and this is what should be making everyone nervous.
Grant is prepping a higher debt ceiling because he is smart enough to see the looming dangers on the horizon.
Putin is just starting.
The recession in America and Europe is just beginning.
China is becoming more unstable by the passing week.
Geopolitical crisis + economic meltdown + catastrophic climate change = looming meltdown.
Grant is raising the debt ceiling not to spend more, he is raising it because he knows what’s coming next.
When a politicians as cautious as Grant is opening the cheque book, we should all be very concerned.
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Incoming lolly scramble for the election is all it is.
Was it 77% of people in last poll saying govt not doing enough about cost of living? This government is purely reactionary and unable to think ahead at all.
Watch the govt happily spend our money to buy back votes.
So you think benefits should be slashed and US style health care imposed?
He’s not cautious, he’s trying to create a fund of debt to cover his obscene profligacy over the past two years.
Contrast his mismanagement of our money to that most parsimonious of Finance Ministers, the perpetually scowling Michael Cullen and then tell me again that Grant is cautious.
Cullen was my local MP for a while and I didn’t like him one bit, he always looked utterly miserable and as though he’d rather be anywhere else than his electorate on the very rare days he did make an appearance however, I never questioned his ability or intellect and despite myself I respected his management of the economy up to the end of the Clark regime when he allowed petty spite and ideology to undo all his great work.
Grant is the equivalent of a lower management moron in a nowhere town who thinks he’s the CEO in contrast to Cullen.
Also, we need less debt not more
Grant is only cautious when it comes to helping the poor. When his chance came to inflate assets to levels never seen before in NZ and with all his peers (ie Luxon) having multiple assets he put his foot right to the floor and grabbed as much as possible for his mates. The conflict of interest in parliament has reached corruption levels. This must be addressed ASAP.
Grant Robertson has been an astute Minister of Finance in my opinion and I think it prudent to remember that it is a role which he was not expecting. It’s a pity he was not elected as Labour leader and then Prime Minister in 2017. Jacinda Ardern has left her stamp on the country as Prime Minister, of that there is no doubt; however, had the role belonged to someone as level headed as Mr Robertson, we would have experienced different policies and arguably a lighter agenda during the past four years.
Martyn ask Bernard’s opinion on what the 1trillion figure is now. It was a snap shot of probably largely unrealised gain, given property was a large part of it. I think you will find that gain on paper has changed drastically. Once again the “rich” is anyone who owns a property. That’s probably a good number of people who comment on this site. I am sure at least some will say they don’t feel rich.