If, like me you've been trying to answer the question - 'Has National fixed the economy yet', I created a web site to analyse the data in detail:


http://www.hasnationalfixedtheeconomyyet.com

 

Comments (24)

by Peter Matthewson on January 10, 2014
Peter Matthewson

Did anyone imagine they would??

by Pete George on January 10, 2014
Pete George

The economy will never be fixed, especially using those parameters.

"Catching up to Australia" is unlikely to happen (as unlikely as Dunedin catching up on Auckland) unless Australia has a major crash that we avoid, and that's also unlikely because our trade and our economy are very reliant on theirs.

There are many indicators suggesting National has the economy on track to improvement.

The big question is what impact a Labour-Green-Mana government would have on the economy compared to how it's likely to go if National remain in charge. It's a given that Labour-Green-Mana would increase government spending more, possibly substantially. It's also likely they would increase taxes more.

Which the voters prefer is this year's elections big question.

by Andrew Osborn on January 10, 2014
Andrew Osborn

An economy is never 'fixed'. It's not a car gearbox. It needs continual nurturing, development and innovation.

We're doing reasonably well at the moment although I think we still have too many eggs in too few baskets. We need more diversification - more strings to our bow.

The problems in the past with the NZ economy have largely been our our doing. NZ Inc has not played its cards well. We have many potential assets that our cousins over the Tasman do not, so in the long run NZ could overtake Aussie in terms of income per capita. It's up to us.

Before the doom sayers wail 'Tyranny of Distance', let me tell them it's a weak excuse for failure. For decades NZ has profitably exported chilled meat and cut flowers right around the world. Is there any more sensitive to transport than those two items?

What we need now is a steady hand on the tiller: A decade of broading the economy, of investment in capital equipment and the development of diverse new products & ideas which will provide the quality employment we so desperately need. 

We also need to cut our compliance costs, further streamline government and in general make NZ an investor and innovator friendly nation. Whilst doing all those things there is no reason why we can't also be improving our personal health, quality of life and environment.

It's up to us not to drop the ball in this years election.

 

 

 

 

by Alan Johnstone on January 10, 2014
Alan Johnstone

Fixed it? Was it in good working order when it was handed to their control?

An economy is never "fixed", it's in constant evolution. The only question is improving or stagnating ?

 

by Ross on January 10, 2014
Ross
Josie Are you suggesting the economy was broken when National took the reins? That must mean the previous administration must be held accountable, right? Which isn't to say that National shouldn't be held accountable for it's time at the helm.
by Ross on January 10, 2014
Ross
Moreover, rather than say, rather banally, that the economy isn't fixed I suggest it would be useful if you provided a detailed explanation as to how it could or should be fixed.
by BeShakey on January 10, 2014
BeShakey

New Zealand's last run of three years where national GDP was greater than the OECD average ended in 2005, StatsNZ only has regional GDP for every region from 2007. So no NZ government ever could demonstrate that they'd met those criteria. Even if you ignore the data issue, it's been at least 40 years (probably longer) since a government met the criteria where there is data.

Holding National to account using stupid criteria is a good way to hide their genuine ineptitude.

by Peter Matthewson on January 10, 2014
Peter Matthewson

The myth that National is a better manager of the economy has been around at least since Muldoon proclaimed that no-one knew the New Zealand economy as well as he did. Remember where that got us. 

by Fentex on January 10, 2014
Fentex

We also need to cut our compliance costs

No we don't, NZ has no particulrly demanding compliance costs in doing business.

NZ needs capital that is willing to take risks and better management of what established business we already have. Too much of our captial is kept safe and too many of our managers are dull and averse to change.

Even if we did boldly reach for the nettle there's no gaurantee we'll enjoy what we grasp - NZ is at the end of the worlds supply and communication lines with little that is unique and vanishingly small influence to sway outcomes to our benefit.

Persoanlly I don't think any of this is a governmnets concern. Governmnets exist for mediating between competing interests of citizens and for providing a common defence from each other and our common enemies. It is not a source of wealth nor a competent manager of investment, we should each be left as much as practical to seek each for ourselves.

by Andrew Osborn on January 10, 2014
Andrew Osborn

Fentex: [NZ] has no particularly demanding compliance costs in doing business

Clearly you haven't tried to build a house recently

 

by stuart munro on January 11, 2014
stuart munro

The damning inditement of National lies in not merely keeping them to the yearly OECD average growth curve, but compounding the growth from the beginning of their term. By this measure they are not merely weak, but utterly inept.

It is well-established that catch up economics, as played by Japan, Korea, China, Malaysia and parts of Eastern Europe are considerably easier than groundbreaking growth. The Gnats are not achieving either.

Labour, if it wants to govern, is going to have to do their job for them.

There are a number of issues that any even vaguely competent government would have addressed long ago:

  • the $5 billion of corporate tax evasion
  • the dysfunctional housing bubble that swallows any positive growth effect
  • the job shortage

Longer term, a government ought to be

  • developing capacities we are likely to need
  • looking to improve the overall effectiveness of the economy
  • addressing issues like cost and ease of living
  • looking for ways to reduce civil compliance costs - rates,licences,fines,user charges.

I'd love to tell Josie how to do those, but then I'd be eating her lunch.

by Pete George on January 11, 2014
Pete George

Our economy was starting to turn to custard before Nationasl took over, as well as being hit by the Global Financial Crisis. The Christchurch earthquakes also had a severe impact. Despite this there are a number of indicators suggesting we are finally recovering and our economy is emerging in a better state than most other countries.

the $5 billion of corporate tax evasion

What is this figure, a one off? Annual?

Tax evasion has been addressed by past governments and still is being addressed. It's not simply a matter of doing something and it's fixed, it's very complex.It's an easy criticism for those in opposition but governments have had difficulty grappling with it.

Or do you have a silver bullet fix Stuart?

by Andrew Osborn on January 11, 2014
Andrew Osborn

Scratching my head here - I didn't see Labour closing any tax gaps during their ten years in office. In fact under National income tax has become MORE progressive. National has also closed the door on some dodgy tax gaps for landlords - LAQCs. Was this just incompetence by Labour or was Helen (owner of several properties) talking out of both sides of her mouth?

So Stuart, I suggest you do some fact checking before you post.

In comparison to most other countries, NZ has come out of the 2008 crash very well. Not only that but we have also managed the earthquake and South Canterbury Finance failure at the same time! The reasons for this are deft financial control by our government & sound Austrailian owned banks.

By comparison take a look at the countries which are still on their knees with vast youth unemployment and crippling debt - they're the ones which were more Left - heavy unionism, socialist governments, restrictive employment practices & punitive marginal tax rates. Ask a Frenchman how Mr Hollande is fairing or a Greek's opinion of Papandreou. 

Reality bites!

 

by Craig Williams on January 11, 2014
Craig Williams

You conveniently forget to mention that GST was raised from 12.5% to 15%, and I don't think you could call the new income tax rates more progressive since the changes benefited higher income earners the most.

 

 

 

 

by stuart munro on January 11, 2014
stuart munro

I notice that the rightwingers leap immediately into tax denial. The numbers were from fraud comparisons between annual benefit and tax frauds, I imagine you can google it, though I'm frankly surprised you weren't paying attention.

Silver bullets? In times of high unemployment, with massive tax fraud, any government that isn't completely stupid or completely corrupt would hire a few more IRD staff.

Andrew Osborne - you shouldn't lie - the Gnat/Banks/Dunne/Maori hydra has been strongly tax regressive. GST, prescription charges, paperboy taxes and plenty more.

The history of the hidalgo gold is relevant to the NZ property bubble. Throwing our doors open to foreign property ownership is not economically sound in the long term. This is how Spain went from being Europe's predominant power to being a 'sick man' no for centuries. Property is not productive, and the current extremely tax-favourable status of property needs to be amended.

But as I said - it's Josie's show. About 200 000 jobs would reverse NZ's decline. I know where I'd find them, I know the Gnats can't find them, I want to know where Labour would find them.

by Pete George on January 11, 2014
Pete George

I'm not leaping into tax denial stuart, I'm well aware of issues with tax avoidance (most of it legal) and the difficulties in dealing with it.

If you can't back up your own claims then they are pointless hot air. Base erosion and profit shifting are major issues but that is being worked on internationally and it will only work with international co-operation.

"About 200 000 jobs would reverse NZ's decline. I know where I'd find them"
"hire a few more IRD staff."

Yeah, right. If you mean creating more jobs in the bureacracy that won't fix much but will cost much.

by Andrew Osborn on January 11, 2014
Andrew Osborn

Craig: You conveniently forget to mention that GST was raised from 12.5% to 15%, and I don't think you could call the new income tax rates more progressive since the changes benefited higher income earners the most.

I presume this was addressed to me???

The numbers are the numbers no matter which way Labour twists and turns.

http://www.beehive.govt.nz/release/more-progressive-tax-system-2010-changes

As regards the GST change, this is also a progessive move. Rich people spend more and thus pay more GST. 

A thought: Do people support the Left because they're innumerate? 

by stuart munro on January 11, 2014
stuart munro

Pete, you are in denial - the study referred to fraud.

Of course IRD won't need 200 000 people. But it could profitably engage some more.

I really wonder how the far right survives your brand of mental laziness.

by Ken Crawford on January 12, 2014
Ken Crawford

I'm impressed by Andrew Osborn's faith in the deftness of the current government regarding the quake and SCF failure and our national future-proofing. He's impressed that we've not let the tyranny of distance (nor achingly hard currency) prevent us from exporting meat & fresh flowers.We are not wailers and doomsayers, not we. As one who exported cutflowers to Japan and the States till I saw the light,  I think he might like to look again at the relative 'success' of this type of economic activity. When the trade winds turn and we drop off the cow's back, will it be every hand to the cycleway? ( to abuse with a steady hand on the tiller  another of those fatuous cliches like 'eggs in baskets' and 'strings to our bow' that some commenters seem to substitute for critical thinking.)

If only  'lefties' and 'greenies' would stop stinking up the nest while this National government begins, after six long years, its "decade of broading the economy, of investment in capital equipment and the development of diverse new products & ideas which will provide the quality employment we so desperately need. " 

What we are currently  witnessing, of course, is a shift that is global in nature, to an era of 'jobless recovery' where the reality of  problems like unemployment and poverty is  deliberately hidden  from us by semantic tinkering and statistical massaging, where wealth and political power are ever more concentrated, and where the real cost of 'progress' in the form of a soiled environment and depleted resources is transferred to the community (aka 'socialised') while the profits are privatised, usually off-shore or  ' somewhere else.'

Would folk like Andrew Osborn care to have it any different?  On the evidence so far, probably not.

by Pete George on January 12, 2014
Pete George

Stuart - you make grandiose unsubstantiated proposals, you resort to ridiculous  personal attacks, and you accuse me of "mental laziness"?

And your own comments are confusing evasion and fraud.

200,00 jobs, Some "profitably engaged" by IRD. What about the other 199,000 odd? Specifics? Or hot air?

by Andrew Osborn on January 12, 2014
Andrew Osborn

Ken Crawford: Thanks for ad hominem attack.

Have you nothing constructive to offer?

 

 

by stuart munro on January 13, 2014
stuart munro

@ Pete - I proposed something constructive - pretty basic in fact. All you do is complain. Ok, so you're a far right shill - congratulations - now do you have anything constructive to add? I reckon I can probably find quite a few more as it happens - the object however is not to feed a troll like you, but to resolve some of these problems. 

If you just want to kvetch, you might be more comfortable running along and playing on kiwiblog with the rest of the moral roadkill.

by Tim Watkin on January 13, 2014
Tim Watkin

Andrew, you got a smile out of me – criticising Labour for its "twists and turns" and quoting a National Party press release to do so! Using spin to damn spin?!

Equally, to criticise someone as innumerate the sentence after you've called a GST increase progressive also makes me smile. GSTs are by definition regressive because everyone pays the same regardless of their income. Sure, you can argue that rich people pay more GST than poor people, but obviously that doesn't make it progressive. Afraid you're just plain wrong on that one.

Having said that, thanks for the link to the press release, it's fascinating and one that I missed. It's an interesting claim by English worthy of some fact-checking. The claim especially that those on under $60,000 are paying a lower proportion of the total tax take must worry the left as it steels their ground. I'm looking for the spin – is it because the total tax take is down maybe? Or have Dunne's changes (and the tax cuts) for the rich paying more and avoiding less? Or is the $60,000 figure a convenient line (and if you look at the very poor on say 40k and less the proportion higher? It seems to fly against logic given the GST change, but has English actually achieved something in the equality stakes? Raises some interesting questions. Anyone got any answers?

The other point English argues is worthy of its own wee post, which I'll do now...

 

by stuart munro on January 13, 2014
stuart munro

The most fatuous collection of spin you are ever likely to meet, Tim.

Firstly, it's all estimates, there's not a grain of objective data in any of it. This allows English to deny it when, as always, his performance falls short.

Then you get rubbish like this:

  • households earning more than $150,000 a year – that is, the top 12 per cent of households by income – are generally expected to pay more of the total net tax than they were paying in 2008/09.
  • And only 6 per cent of individual taxpayers earn over $100,000 a year, yet they pay 37 per cent of total income tax. This has increased from the 2010/11 tax year, when those taxpayers paid 29 per cent of total income tax.

These figures omit the share of national income. The 6 &12% groups receive vastly more than other groups, so that paying more is merely proportionate to that income, not progressive.

This next piece of offensive claptrap refers to the extreme right welfare working group, which has not produced anything of value for beneficiaries - it makes disentitlement mechanisms to conceal the unemployment and underemployment rate - based on the atrocious ATOS regime in England.

“But we also expect people to get back into work when they are able to. The Government is supporting them to do that through significant extra investment in welfare reforms.”

The prime current investment in welfare reform would be the compulsory drug testing of unemployed people, which is oppressive mechanism, and which showed drug use by unemployed people not to be significant. 22 out of 8000 - all testing charges channeled to a Gnat crony.

He's a great liar, is Bill, but he's not an economist's bottom. Which of course is why neither significant growth nor significant growth initiatives have occurred on his watch.

 

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