The economic reality in NZ that the Political Right AND Left refuse to acknowledge

“Where two old souls go slowly mad, / National Mum and Labour Dad”

Ballard of Calvary Street, James K Baxter

 

It seems to me that there is an economic reality about NZ that Labour and National are refusing to acknowledge.

NZ has always been three enormous and sparsely populated Islands that have always relied on the State to be the 40% foundation stone. The free market dynamics of competition don’t work well when the population density is low. The State is the egalitarian backbone of this country, the Right want to gut it and hand the organs over to their rich mates.

Bernard Hickey explains the fundamental problem, we can’t just keep selling each other more expensive houses built upon mass immigration and pretend that is economic growth any more…

• In my view, the data on retail spending, jobs, real incomes and housing equity are increasing the chances the ‘green shoots’ of better business confidence and manufacturing don’t convert into voters ‘feeling’ the economic recovery enough to emphatically award the Government a second term in our housing-market-with-bits-tacked-on.
• In my view, that’s because forecasters and Treasury haven’t taken into account how important a stagnant housing market and lower real incomes after food, power and rent costs are for household spending and business investment.
• The bottom line: An economy powered for 30 years by leveraged and tax-free house price inflation can’t handle the truth that another trebling of prices isn’t possible again. That’s because interest rates can’t fall again by nine percentage points, household debt can’t treble again relative to disposable incomes, and employment growth from a 15 percentage point increase in workforce participation can’t be repeated in an ageing population.

…exactly, the one trick property speculation pony that has powered the last 30 years of ‘economic growth’ has had a stroke and is off to the glue factory.

Catastrophic Climate Change, geopolitical trade tensions and the hollowing out of public infrastructure to cheap management teams who milk monopoly rentals while the asset deteriorates.

I’m not asking for socialism from the NZ Left, I’m just looking for basic regulated capitalism!

The 30/30/30 neoliberal debt straightjacket is designed to ensure the public never get fully funded public services.

How on earth can more user pays mythology be the answer when it’s the cause of the current malaise!

Adopting more user pays to solve our problems is like using cancer to cure syphilis.

We need new ideas.

We need to consider new taxes aimed at the wealthy and the speculative.

We need to remove the tax yoke from the working and middle classes and put them on the wealthy.

We need to consider Sovereign Credit as a means to fund new infrastructure.

We need to resource our Communities and make them resilient.

We need way more artists.

We need sustainability.

We need to defend our Economic Zone.

We nee to be 100% electrified and 100% sustainable.

We need a pharmaceutical industry.

We need a data centre industry.

We need a drone industry.

We need to produce things here rather than be a raw material producer.

We need way more native forests.

We need way less pine forests.

We need a new inshore shipping network.

We need more rail.

We need more food security via a third state backed supermarket.

We need less trucks.

We need less cows.

We need more wool production.

We need local investment in R+D.

We need post-growth capitalism.