Sunday, April 14, 2024

Professor Robert MacCulloch: Buyer Beware - None of NZ's Political Parties is equipped to solve our most pressing economic issues

Here's why not a single one of our political parties is in a position to solve NZ's most pressing economic issues:

1. Labour has revealed itself to be consistently in favor of big government and crushing regulation. Its over-eagerness to lock-down Aucklanders indefinitely symbolically positioned Labor as the Party of Oppression. These past 6 years, Labour has shown itself to have some wonderful ideals, like zero poverty, zero net emissions & zero hate, eloquently expressed in soaring poetic speeches written by platoons of PR, marketing & Comms experts, but empty of any practical way of delivering them. When it comes to implementation, Labour appeals again & again to more taxes & more regulation - the latest being wealth & capital taxes.

2. The NZ Green Party loathes free markets & economic prosperity, which it blames for environment degradation. It wants to make everyone equally poor. The fact that the only long-term way to avoid bad environmental outcomes is new technologies invented by private companies which allow power to be generated with few carbon emissions eludes the Greens. The Party's primary ambition is to kill capitalism, not save the environment.

3. National is a conservative party. It refuses to contemplate the large-scale changes needed to shift NZ to a country of high savings, high investment & high productivity. The Party never liked Kiwi Saver. A guy called John Key stated when it was first debated in Parliament in 2006, "There are many problems within Kiwi Saver .. National will not support Kiwi Saver. We do not think it will work ..". After it was enacted over his protests, funds under management were $6 billion in 2010. They're now nearly $100 billion. National will also never support the build-up in privately-provided competitive health-care services required to save our health system. It will not support the break-up of monopoly power rife in NZ. National always has been, and still is, a pro-business, not pro-market, political party. It is not pro-consumer.

4. ACT has no solution to NZ's welfare problems. The only way a right-wing party can help solve them is to be pro-strong families, which ACT is not. It is a classically liberal party. Weak families mean high truancy, high crime, weak education & large numbers of folks isolated on their own, which require welfare to clean up the problems. Yet ACT barely recognizes the family as being the vital institution that nurtures the young. It is only with strong family support that you can get away with the low State support that ACT desires. Weak families lead to higher welfare spending as the social problems they create proliferate. So ACT's views on taxes & welfare make no long-term coherent sense.

5. Last but not least, NZ First is happy to stand-by & support the worsening of NZ's fiscal situation by not supporting measures it perceives will weaken the power of the elderly and strengthen the young. For example, it has ruled out any change in retirement age. However, in the face of an ageing population, an entirely new system of institutions for NZ, including Singapore-style retirement & health savings accounts, is needed to solve our problems.

So my view is that we should not be tricked into thinking any savior currently exists in our current political landscape. Labour was so bad, it had to be voted out, so anything is an improvement upon that lot as they currently exist. But as for the present Coalition sorting out NZ's long-term structural problems, whether it be fixing Auckland or our welfare system in the face of an ageing population, none of the parties comprising it even come close.


Professor Robert MacCulloch holds the Matthew S. Abel Chair of Macroeconomics at Auckland University. He has previously worked at the Reserve Bank, Oxford University, and the London School of Economics. He runs the blog Down to Earth Kiwi from where this article was sourced.


Anonymous said...

I think Prof MacCulloch should be - at very least - Finance Minister and perhaps leader of a new party........

Anonymous said...

A fair bit of truth in this.

Anonymous said...

As long as have a ‘collective’ mob rule system called Democracy and ‘collective’ political parties vying to be front and center of this collective system, we are on a one way road to hell.

A democracy is always temporary in nature – it simply cannot exist as a permanent form of government. A democracy will continue to exist until the time that voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always vote for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy – usually followed by a dictatorship.

‘Collectivists’ seek political office because it gives them power over others. There are no savior's for individual freedoms and rights to be found with politicians working within a collective system.

Individualists shy away from office because they dislike politics and prefer not to get involved with it.

If freedom is to prevail, that has to change, therefore a new ‘non collective’ system is required, one that protects individuals inalienable rights and freedoms.

DeeM said...

Put your money where your mouth is, Robert, and either join the political party you think easiest to change (the best chance of success) or start your own party and run for election (miniscule chance).

Geoffrey said...

Very good synopsis, thank you.

Do you have any solutions to propose. Labour was hot on dreams but weak on delivery. No, strike that: they were appalling. I do hope you have a plan.