Which prompted me to send this response to the Herald’s editor;
from: Frank Macskasy <email@example.com>
to: NZ Herald <firstname.lastname@example.org>
date: Sun, Jan 15, 2017
subject: Letter to the editor
Letter to the editor
Regarding Juliet Moses’ comment in the New Zealand Herald article, that UN Resolution 2334 “was an affront to all New Zealanders” (6 Jan) – I will thank her and her fellow travellers not to assume they speak for me and others.
Last I looked, Israel has not added Aotearoa to it’s list of illegally annexed territory.
As for Moses’ assertion;
“…Israel’s Arab neighbours mounted a second unsuccessful attempt to exterminate her in 1967”
– is either woeful ignorance or wilful misrepresentation of historical fact.
Israel launched the so-called Six Day War on 5 June 1967 against it’s neighbours;
“In response to the *apparent* mobilization of its Arab neighbours, early on the morning of June 5, Israel staged a sudden preemptive air assault that destroyed more than 90 percent Egypt’s air force on the tarmac. A similar air assault incapacitated the Syrian air force.” – Encyclopedia Britannica
Arrogant and mis-informed. She most certainly does not speak on my behalf.
Encyclopedia Britannica: Six-Day War – Middle East – 1967
= fs =
Following his unexpected announcement to resign as New Zealand’s Prime Minister on 5 December last year, much has been said of Key’s “legacy”. Pundits have been scratching their heads, trying to figure out what “legacy” can be attributed to eight years of a Key-led administration.
Despite screeds being devoted on the subject, it appears that little can actually be attributed to any form of Key “legacy”.
On 29 December, Radio NZ’s “ “, Brent Edwards, wrote;
“At the time of his departure, his own personal rating remained high…”
Whilst Key’s Preferred Prime Ministership rating remained higher than his rivals, Key’s public support had plummeted since 2009. In October 2009, Key rated a phenomenal 55.8% in a TV3/Reid Research poll.
By May last year, TV3/Reid Research reported Key’s support to have fallen by 19.1 percentage points to 36.7%. The same poll reported;
National though is steady on 47 percent on the poll — a rise of 0.3 percent — and similar to the Election night result.
So something was clearly happening with the public’s perception of Key. Whilst National’s overall support remained unchanged from election night on 2014, Key’s favourability was in slow-mo free-fall.
Edwards’ analysis of Key’s “legacy” appeared mostly to consist of this observation;
Within the political commentariat Mr Key has been highly regarded, mainly on the basis of his political style.
He was quick to dump any political unpopular policies before they did terminal damage to his government and he had an uncanny knack of skating through the most embarrassing political gaffes with little damage, if any, to his political reputation
What other Prime Minister, for example, would have escaped with their political credibility intact after revelations they had repeatedly pulled the ponytail of a waitress at their local cafe?
In effect, Key’s ‘qualities’ appeared to consist of constant damage-control and “an uncanny knack” to avoid being charged with assault.
Edwards contrasted Key’s administration with that of Jim Bolger and pointed out the latter’s legacies, which have had a lasting impact of New Zealand’s social and political landscape. The first was the advent of MMP which forever changed politics as it is done in this country. The second was Bolger’s courage to stand up to his party’s redneck conservatism and engage with Maori to address Treaty of Waitangi grievances.
Key’s “legacies”, according to Edwards, was a failed flag referendum costing the taxpayer $29 million and this;
He did help manage the country through the Global Financial Crisis and the Christchurch earthquake. But National was left a legacy by the previous Labour Government – a healthy set of government books – which gave it the financial buffer it needed to deal with both crises.
Irony of ironies – Key’s one claim to a “legacy” was the product of a prudent Labour finance minister whose own legacy was a cash-gift to Key. Yet, even that cash-gift to Key could have been squandered had then-Finance Minister, Michael Cullen listened to Key’s wheedling demands for tax-cuts;
“Mr Key can’t have it both ways. One moment he says there is a recession looming then he thinks there are still surpluses to spend on tax cuts.”
… he is almost the kinder, gentler Kiwi Donald Trump. He is a populist who has been able to read and respond to a national mood in ways that few other politicians have, although that has more to do with a reliance on opinion polling than some kind of semi-supernatural intuition.
Matthews’ reference to Key’s ability “to read and respond to a national mood in ways that few other politicians have, although that has more to do with a reliance on opinion polling” was pointed out by Radio NZ’s John Campbell, in his own assessment of the former Prime Minister’s tenure;
Key entered Parliament in 2002. His maiden speech was a pre-Textor, pre-dorky, pre-casual, pre-everyman piece of rhetoric, ripe to the point of jam with admonishments and exhortation.
And the key passage, in this respect, was: “We mustn’t be scared to do things because they might offend small groups, or seem unconventional. Good government is more than doing what’s popular. Good government is more than blindly following the latest opinion poll.”
On election night 12 years later, having just been made prime minister for a third term, Key triumphantly thanked his pollster, David Farrar, by name: the country’s “best”, he declared, admitting, as the New Zealand Herald reported, that he had rung Farrar “night after night, even though he wasn’t supposed to”.
The man who’d entered Parliament declaring a belief in something better than poll-driven politics had subverted himself. Gamekeeper turned pollster.
Matthews summed up with this conclusion;
He was somehow politically untouchable, even when New Zealand was laughing at or with him, or just cringing. Future historians will provide a clearer picture of his failures: A flag change that was supposed to be a personal legacy became an expensive embarrassment; the Trans-Pacific Partnership deal is dead in the water; he could have used his political capital to do something meaningful about inequality and poverty.
But over on the West Coast, the government’s failures to satisfy the grieving Pike River families remain entirely embodied in Key.
Again, Key’s abilities appear to lie with being “politically untouchable”. His “legacies” amounted to a list of dismal failures.
The unknown author of an editorial for the Otago Daily Times was kinder, as if it had been written by one of National’s small army of taxpayer-funded Beehive spin-doctors;
The legacy Mr Key will leave is one of financial stability, a unified government, a record of strong economic management and a commitment to lift as many New Zealanders out of poverty as possible. A shortage of suitable housing has been laid at the door of Mr Key but his efforts in trying to sort out that particularly difficult area have been assiduous.
One of the issues he received the most criticism for is failing to bring home the bodies of the Pike River miners who died in the explosion. While Mr Key would have meant what he said at the time, the pragmatism which ruled his career meant he made a tough call to allow the mine to be sealed. Then there was the failed flag referendum.
But, his leadership during the Christchurch, and latterly Kaikoura, earthquakes was seen as outstanding by most New Zealanders. New Zealand secured a seat on the United Nations Security Council in no small part due to the work carried out by Mr Key.
Curiously, the un-named author glosses over the “commitment to lift as many New Zealanders out of poverty as possible”, “a shortage of suitable housing … laid at the door of Mr Key”, “criticism for … failing to bring home the bodies of the Pike River miners who died in the explosion”, and “the failed flag referendum”. Because at least – the author crows – we “secured a seat on the United Nations Security Council”.
The ODT’s mystery cheerleader for our former Dear Leader may be one of the few attempts to put a positive ‘spin’ to Key’s administration. It was, however, glaringly light on specifics.
In direct stark contrast to the ODT’s lame attempt to canonise Key, Audrey Young was more caustic in her piece, Key – No vision, no legacy, no problem. Her conclusions were;
… two other areas I consider to be legacies for the Key Government although he has not claimed them as such: the Ross Sea sanctuary and the modernization of New Zealand’s spy agencies.
Unfortunately for Young, the original proposals for a MPA (Marine Protected Area) for the Ross Sea began as far back as 2005, and was first mooted by the US delegation to the Commission for the Conservation of Antarctic Living Marine Resources (CCAMLR).
If Key’s sole legacy was to increase the spying powers of the SIS, GCSB, and uncle Tom Cobbly – that may not be something his descendants bring up at polite dinner parties;
“Yeah, it was grand-dad Key who helped turn New Zealand in the virtual police state we have now. Sure we have spy cameras in every home, workplace, and cafe, but crime is almost non-existent!”
– is not something Max or Steph’s own kids will be heard crowing about.
Young suggested that Key’s “legacy” was more akin to a ‘state of mind’;
When I’ve asked people this week what they thought Key’s legacy was, many have said he gave New Zealanders a greater sense of confidence, especially about New Zealand’s place in the world.
That is true but it is a state of mind. It could just as easily disappear through circumstances well beyond our control.
Giving “New Zealanders a greater sense of confidence, especially about New Zealand’s place in the world” were the legacies of former Labour Prime Ministers – notably Norman Kirk and David Lange. Their leadership against the war in Vietnam; atomic bomb testing in the South Pacific; opposing apartheid in South Africa; advancing gay rights, and turning the entire country into a nuclear-free zone are legacies that are with us today.
Going back even further, and the legacies of Labour’s Michael Savage are still discussed today.
Cringing whilst Key recited his “Top Ten Reasons for Visiting New Zealand” on the David Letterman Show would hardly have given Kiwis “a greater sense of confidence, especially about New Zealand’s place in the world“;
[Warning: Cringe Level: Extreme]
Most who saw that episode would have hidden their heads beneath a pillow or blanket. Hardly the stuff of legacies, except of the Silvio Berlusconi variety.
She then concluded;
The fact that Key doesn’t really have a legacy is of no matter.
Well, that’s alright then. According to Young, Key’s “legacy” would be in the same vein as the manner in which he handled his own and ministers’ scandals and stuff-ups; nothing to see here, folks, no legacy, move along please.
Comedian, Jeremy Elwood, offered;
We may never have another Prime Minister who provides as much fodder for as many late night comedy shows around the world, as well as right here, again, but that’s all been part of his “popular appeal”.
Another ‘comedian’ – albeit unintentional – was Roger Partridge, writing on behalf of the so-called NZ Initiative (formerly the now largely discredited Business Roundtable). Partridge offered a lengthy list of neo-liberal “reforms” from Key’s tenure as PM;
Key’s was also a reforming government. After the Fourth Labour government, it was perhaps New Zealand’s most radical in the post-war era. The GST for income tax swap, welfare reforms (the likes of which might have brought down another government), the investment approach to social services; labour market reform, partial-privatisation, reforms in education, including national standards and charter schools: these may have occurred incrementally, but together they comprise a prodigious package of reform.
None of Partridge’s listed “reforms” will stand. In an era marking the rise of nationalistic political movements (Brexit, Trump, et al), Key’s “package of reforms” will be rolled back and many, like Charter Schools, swept away entirely.
These legacies of a failed economic ideology – neo-liberalism – may rate a mention in the footnotes of future history books, but not much more. In fifty years time, no one will point to Key’s supposed “reforms” as people still do to Michael Savage’s achievements.
The Herald’s pointed to; Liam Dann
…ongoing GDP growth at about 3 per cent, unemployment at around 5 per cent and the crown accounts are solid with the Government booking surpluses that are forecast to top $8 billion within five years.
– but had to concede that much of this “growth” was illusory, based mostly on high immigration and unsustainable ballooning house prices in Auckland;
The housing boom has been a global phenomenon driven by the unusually low interest rate environment in the wake of the GFC. Investors have been looking for somewhere to put their money outside of the bank and assets prices have soared – both sharemarkets and property.
And far from National’s books being in surplus, Key has managed to rack up a debt of $95 billion according to a recent Treasury document. Dann must have missed that salient bit in his rush-to-gush. He did, however, acknowledge the nature of the “ongoing GDP growth” further into his piece;
Overall population growth and record net migration is widely cited as a factor taking the gloss off New Zealand’s strong growth story.
Per capita GDP isn’t nearly so strong and the extra population is adding to the housing bubble and highlighting some deficiencies in infrastructure spending.
Almost reluctantly, Dann concludes;
He has not been a reformer but he has created a stable platform, in unstable times, for growth.
He exuded confidence and it rubbed off on the economy. Whether he has done enough to set the nation up for long-term prosperity, as outlined in those rosy Treasury forecasts, remains to be seen.
He also repeats Brent Edwards’ observation;
…Key made the most of the market conditions he had to work with. He has benefited from some ground work done by the previous Labour Government, particularly in booking the gains from the China free trade agreement.
Writing for Radio NZ, John Campbell asks;
So, in the end, how will history judge John Key?
In his earnest, boy-scout, way, Campbell is charitable about one possible legacy left by Key;
In the age of Trump and Brexit and Manus Island, and having succeeded Don Brash and his divisive Orewa rhetoric, part of what may endure is a sense that, under him, New Zealand did not embrace xenophobia and paranoia and the vilification of Māori, Muslims, Mexicans, blue-collar immigrants and almost anyone who wasn’t Tribe White.
To this point, writer and trade unionist, Morgan Godfery, not a natural ally of Key, tweeted on the day the prime minister announced his resignation: “I’ll go into bat for Key on this: he rejected the politics of Orewa, avoiding what might have been an ugly decade of tension and conflict.”
Which might be true… except that Key and his Ministers were not above vilifying those who dared criticise National, or when it suited party-politics;
In his usual manner of gentle admonishment, John Campbell chides Key and his Administration for their failing in housing;
“When I was six”, [Key] said in his maiden speech, “my father died; leaving my mother penniless with three children to raise. From a humble start in a state house, she worked as a cleaner and night porter until she earned the deposit for a modest home. She was living testimony that you get out of life what you put into it. There is no substitute for hard work and determination. These are the attitudes she instilled in me.”
Key was six in 1967. Among the many things that have changed since then is housing affordability. The IMF’s latest Global Housing Watch lists New Zealand’s housing market, in relation to household income, as the most expensive in the OECD. Could a penniless solo mother, working as a “cleaner and night porter”, paying market rents, now earn the deposit for a modest home?
Then Campbell issued what may well be Key’s one and only true legacy – if one could call a broken promise to the grieving families and friends of 29 men entombed deep within a mine on the West Coast, a “legacy”;
This is what John Key said, behind closed doors, when he met with Pike families on September 22, 2011.
“The first thing is I’m here to give you an absolute reassurance we’re committed to get the boys out.”
An absolute reassurance. The boys out. When the families heard that, there was spontaneous applause. The human details. The empathy, sincerity and trust. When the clapping stopped, the prime minister continued:
“When people try and tell you we’re not, they’re playing, I hate to say it, but they’re playing with your emotions.”
And then John Key made it personal:
“So, you are the number one group that want to get those men out. And, quite frankly, I’m number two. Because I want to get them out.”
Five years on, the men are still in. It may be that the risk of getting them out is too great. But, when he was alone with them, Key didn’t say that, or qualify his words with that possibility. His was an “absolute reassurance”, and the families believed him and have clung to that belief in the years since.
Of all the many broken promises from Key, that will be the one most remembered. Because as Campbell so astutely pointed out, “John Key made it personal”.
‘Mickey Savage’ writing for The Standard was more brutal and unforgiving in his/her appraisal of Key’s administration;
Key has perfected the aw shucks blokey persona that some clearly like. Although this was only skin deep. His management of dirty politics and the Cameron Slater Jason Ede axis of evil won him the last election but at the cost of his soul.
As to the substance he did not really achieve or create anything. He saw off the Global Financial Crisis and the Christchurch Earthquake rebuilds basically by borrowing money which New Zealand could because Michael Cullen had so assiduously paid off debt.
His economic development policies were crap. Expanding dairying only polluted our rivers and increased our output of greenhouse gasses. The growth of tertiary education for foreign students only caused the mushrooming of marginal providers.
The primary economic growth policy now appears to be ballooning immigration. Auckland’s population grew almost 3% last year. The symptoms are clear, rampant house price increases, homeless caused by ordinary people no longer being able to afford inflated rental amounts and a whole generation shut out of the property market. And services are stretched as budgets are held but demand increases.
And child poverty has ballooned. Key was great with the visuals and the talk of an under class and the trip to Waitangi with Aroha Ireland before he became Prime Minister was a major PR event for him to show that at least superficially he cared about the underclass. But the reality? Over a quarter of a million of children now live in poverty and kids are living in cars even though their parents have jobs. There is something deeply wrong in New Zealand.
Overall Key was great at the spin and the PR but appallingly bad at dealing with the reality. Despite his hopes the country is now in a far worse situation under his stewardship than it was when he took over.
‘Mickey Savage’ has summed up Key’s legacy perfectly and I leave this brief assessment for future historians;
John Key – Master at spin, photo-ops, and PR, but nothing else. When the teflon was stripped away, there was nothing underneath.
And that will be his legacy: nothing. We simply couldn’t think of a single damned one.
Scoop media: 3 News Poll – 2-10 October 2012
Fairfax media: The boy from Bryndwr – John Key’s Christchurch legacy
ODT: The John Key legacy
NZ Herald: Key – No vision, no legacy, no problem
US State Department: A proposal for the establishment of the Ross Sea Region Marine Protected Area
NZ Herald: NZ’s half-trillion-dollar debt bomb
NZ Herald: Bennett gets tough with outspoken solo mums
Dominion Post: Forced sterilisation ‘a step too far’
Against the current: John Key’s Dismal Record on Climate Change
Local Bodies: John Key’s Real Legacy
Sciblogs: Key’s legacy – an economist’s view
The Daily Blog: The true legacy of John Key
The Standard: John Key’s legacy
Your NZ: Key’s legacy
Previous related blogposts
This blogpost was first published on The Daily Blog on 4 January 2017.
= fs =
As with the death of Princess Diana; Trump winning the Presidency, or (if you’re old enough) the assassination of JFK, you will recall where you were when you heard this sudden, unexpected and gob-smacking public announcement from John Key;
At 12.50pm, Radio NZ interrupted it’s international-segment – Worldwatch – to announce John Key’s resignation and crossed live to his press conference. Ironically, the Worldwatch segment featured an interview about the resignation of Italy’s own Prime Minister, Matteo Renzi.
Like 4.4 million other New Zealanders, this blogger was taken by surprise. (At first, I thought Radio NZ was reporting on Bill English stepping down.)
There are two aspects to Key’s resignation which have taken my attention.
Media personalities, pundits, and political opponants have all praised Key’s popularity.
In the NZ Herald, Audrey Young gushed;
“He is still immensely popular after eight years.
They will abound because what Key has done defies political gravity.”
Writing for Fairfax media, Tracy Watkins said;
“Nothing can be the same when a leader as popular, and as successful, as Key bows out.”
John Campbell on Radio NZ’s Checkpoint enthused;
“…And after eight years [Key] still sits at honeymoon levels of popularity in opinion polls.”
To Key he remarked;
“Your popularity has defied the laws of gravity.”
None of which is true.
The media and political pundits have been reading glowing “obituaries” for a man still very much alive and drawing breath.
In fact, Key’s popularity has been spiralling downward since a high of 55.8% in October 2009;
Oct/Nov 08: 36.4%
Feb 2009: 52.1%
April 2009: 51.1%
Aug 2009: 51.6%
Oct 2009: 55.8%
Feb 2010: 49.4%
April 2010: 49.0%
June 2010: 49.6%
Jul/Aug 2010: 48.7%
Sept/Oct 2010: 50.6%
Nov/Dec 2010: 54.1%
Feb 2011: 49.1%
April 2011: 52.4%
May 2011: 48.2%
Jun/Jul 2011: 50.5%
Aug 2011: 53.3%
Sept 2011: 54.5%
Oct 2011: 52.7%
1-8 Nov 2011: 50.0%
9-16 Nov 2011: 49.4%
16-23 Nov 2011: 48.9%
Feb 2012: 45.8%
April 2012: 44.2%
May/Jun 2012: 40.5%
Feb 2013: 41.0%
April 2013: 38.0%
May 2013: 41.0%
Jul 2013: 42.0%
Nov 2013: 40.9%
Jan 2014: 38.9%
Mar 2014: 42.6%
May 2014: 43.1%
Jun 2014: 46.7%
Jul 2014: 43.8%
5-3 Aug 2014: 44.1%
19-25 Aug 2014: 41.4%
26 Aug-1 Sept 2014: 45.1%
2-8 Sept 2014: 45.3%
9-15 Sept 2014: 44.1%
Jan 2015: 44.0%
May 2015: 39.4%
15-22 July 2015: 38.3%
8-16 Sept 2015: 39.5%
22 Nov 2015: 38.3%
24 May 2016: 36.7%
Only four months ago, Key’s Preferred Prime Minister rating had levelled;
8 Aug 2016: 36.7% (n/c)
By contrast, National’s most recent Party-poll ratings remained astronomically (and somewhat unfeasibly) high;
Roy Morgan: 49.5%
Colmar Brunton: 50%
Reid Research: 45.1%
As a party, National has been consistently out-polling it’s own supposedly “popular” Prime Minister. If Key’s personal polling had continued to drop further, it is conceivable that he would have become a Muldoonesque liability instead of the gilt-edged asset he has been for the last three elections.
Which would go some way to explaining why Key’s photo-ops with National Party candidate, Parmjeet Parmar, during the Mt Roskill by-election seems to have had zero positive effect on her election result;
When asked if he would attend Ms Parmar’s by-election campaign party, Key replied;
“I don’t go to any of the by-election ones. I haven’t historically and I won’t be going whether we win lose or draw.”
To which Jenna Lynch, writing for TV3 News, pointed out;
“That’s only partly true though – he didn’t attend the party of Mark Osborne in Northland – he lost. He also didn’t go to Melissa Lee’s failed campaign for the Mt Albert by-election.
But he did attend parties where it seemed he thought his candidate had a chance.”
“Reading the entrails”, Key understood that his days of surging popularity were drawing to an end. The media and pundits were simply slow to catch up with Key’s own realisation of his inevitable fate.
In the same interview yesterday (5 December) on Checkpoint, John Campbell tried to pin down the reason(s) for Key’s departure. With his usual boyish charming honesty, John Campbell asked Key;
“You sound buggered…
… Are you exhausted?”
Key soundly rejected Campbell’s suggestion that he was in any way “buggered” or “exhausted”.
But in May 2012, Key was already showing signs of wearying from the demands of political life;
The frustration continued to show yesterday when Mr Key did a radio show and was asked about the $350 million SkyCity convention centre.
“I’m out there trying to promote a convention centre which we don’t put any money in and all I get is grief. OK? That’s what I get is grief,” he complained.
“Sure I can sit around and do absolutely nothing for the next nine years and I might survive that long but it’s not going to take New Zealand anywhere.”
Four years ago, Key was already showing signs of becoming jaded.
More and more people were becoming disillusioned with his administration – a fact highlighed by his steady decline in the Preferred Prime Ministership polls (see above).
Whatever things Key may be, he is no fool and he was no doubt perceptive enough to recognise that his “chumminess” was no longer a facade he could use to mask growing social problems in New Zealand. Homelessness; child poverty; worsening home affordability; near-stagnant wages; declining environmental quality – coupled with constant scandals; ministerial cock-ups; and dubious dealings, were taking their toll.
Key was friendly with the corporate sector, but his administration showed unrelenting hostility to workers, unemployed and other other beneficiaries, and anyone else at the bottom of the economic heap. National’s decision to increase benefits was announced in May 2015 – but not set to start until a year later. This was a clever ploy to paint National as “caring” for those on benefits, with two publicity-bites from the “media-cherry”.
At the same time, beneficiaries were being forced of WINZ books; state housing was being sold off; and unemployment made to look “low” by Statistics NZ’s fudged figures [see: Lies, Damned lies and Statistical Lies – ** UPDATE **].
But there were social pressures building that National’s “hands off” (or reluctant intervention) could not hide with “massaged”, dubious statistics. Nowhere was this more apparent than in our current housing crisis, affecting both the poor (living in cars and garages) and the Middle Class (facing rising home unaffordability).
The crushing defeat of Key’s vanity-project, the flag referendum which cost taxpayers $29 million at a time when early child education, school operational funding, and many social services were being frozen/cut, was perhaps confirmation that his “popularity” was no longer sufficient to govern.
Key’s charming affability could no longer hide the real right-wing agenda being covertly implemented.
Key could see the writing on the wall.
It was time to go; the charade was over.
Fairfax media: Tracy Watkins – Key’s resignation changes election odds
Roy Morgan: National Party support up again in November
Colmar Brunton: Poll 12-13, 21-23 November 2016
Reid Research: TV3 Poll Results
Radio NZ: Mt Roskill by-election nears
Fairfax media: John Key’s midterm blues?
Radio NZ: Budget 2015 – Govt targets child poverty
Fairfax media: Government to sell 1000 – 2000 state houses – John Key
NZ Herald: ‘Frozen’ school funds heartbreaking
Previous related blogposts
This blogpost was first published on The Daily Blog on 7 December 2016.
= fs =
In troubled times, we are community
On 14 October, eight hours after two massive 7.8 earthquakes simultaneously rocked the entire country, our Dear Leader John Key made an impassioned (for him, it was impassioned) appeal to the people of Aotearoa on Radio NZ’s ‘Morning Report‘;
It was an appeal to a sense of community that is rarely made by right-wing governments or their leaders. It was a tacit acknowledgement that No Man or Woman is an Island that that only by acting collectively can human beings survive and improve their own circumstances and for their children.
Unfortunately, a week later, Key’s sense-of-community-spirit was returned to it’s hermetically-sealed casket and re-buried alongside cryo-capsules containing New Zealand’s Once-Egalitarian-Spirit and International-Independent-Leadership-On-Moral Issues.
National dangles the “carrot”
With a statement that was more convoluted than usual, Key said;
“We’ve identified from our own perspective if there was more money where would be the kinds of areas we want to go, not what is the make up … for instance, of a tax or family package, what is the make up of other expenditure we want?
Tax is one vehicle for doing that, it’s not always the most effective vehicle for doing that for particularly low income families.”
Tax could be effective higher up the income scale, but lower down it was not that effective because base rates were low or it was very expensive.
Over the fullness of time we’ll have to see whether we’ve got much capacity to move.
Making sure they can keep a little more of what they earn or get a little bit more back through a variety of mechanisms is always something we can consider. It could be a mix, yes.
In the end it’s about equity for New Zealanders and about .. having a rise in their standard of living, and there’s a number of ways you could deliver that.”
Key has once again dangled a billion-dollar carrot in front of New Zealanders as the country heads towards next year’s election.
National’s previous election “carrots”
During the 2008 General Election, as the Global Financial Crisis was impacting on our own economy, Key was promising tax cuts. In May 2008, he said;
“But in 2005 we promised tax cuts which ranged from about $10 to $92 a week, roughly $45 a week for someone on $50,000 a year.
“I described it as a credible programme of personal tax cuts and I’m committed to a credible programme of personal tax cuts,” he said.
Questioned on whether National’s tax cuts programme of 2005 was credible today given the different economic circumstances, Mr Key said: “Well, I think it is.”“I believe that an ongoing programme of personal tax cuts that delivers the sort of magnitude that we’ve had in the past is potentially possible.
At the time, then Labour’s Finance Minister, Michael Cullen described National’s tax-cut-bribe as ‘reckless‘.
By October 2008, as NZ Inc’s economic circumstances deteriorated, Treasury issued dire warnings that should have mitigated against any notions of affordable tax-cuts;
John Key has defended his party’s planned program of tax cuts, after Treasury numbers released today showed the economic outlook has deteriorated badly since the May budget. The numbers have seen Treasury reducing its revenue forecasts and increasing its predictions of costs such as benefits. Cash deficits – the bottom line after all infrastructure funding and payments to the New Zealand Superannuation Fund are made – is predicted to blow out from around $3 billion a year to around $6 billion a year.
Key’s government won the 2008 election and proceeded with tax-cuts in 2009 and 2010.
Predictably, government debt – which had been paid down by the Clark-Cullen government – ballooned as the recession hit New Zealand’s economy and tax revenue fell;
Key himself estimated tax cuts to be worth between $3 or $4 billion.
In 2008, New Zealand’s core government debt stood at nil (net)
Current government debt now stands at $62.272 billion (net).
Nature intervenes in National’s “cunning plan” for a Fourth Term
According to Dear Leader Key, estimates for the re-build of earthquake damage in and around Kaikoura; State Highway One, and the rest of the South Island is likely to be at least “a couple of billion dollars“.
Finance Minister Bill English has hinted the cost may be much more;
“The combination of significant infrastructure damage in Wellington, obvious damage in Kaikoura – all roading and rail issues – this is going to add up to something fairly significant. We also know that those estimates change over time.”
No wonder Labour leader Andrew Little was less than impressed at tax cuts being mooted. Echoing Michael Cullen from eight years ago, he condemned the irresponsible nature of Key’s proposal;
“Well this is crazy stuff, I mean in addition to a government having $63 billion worth of debt it is yet to start repaying, and you’ve got a billion dollars extra each year just in the cost of superannuation.
Now we have another major civic disaster that is going to cost in terms of repairs. I do not see how John Key can say tax cuts are justified in the present circumstances.”
National spends-up large on new prison beds
On top of which, English announced last month that National was planning to spend over $2.5 billion on new prison beds. He questioned whether tax cuts were affordable with such looming expenditure;
Finance Minister Bill English has warned an announcement today of plans for an extra 1,800 prison beds will reduce the room for the Government to consider tax cuts before next year’s election.
English told reporters in Parliament the extra beds would cost NZ$1 billion to build and an extra NZ$1.5 billion to run over the next five or six years.
“It will have an impact because it is a very large spend and, two or three years years ago, we probably thought this could be avoidable,” English said when asked if the extra spending would make it harder for the Government to unveil tax cuts and other spending before the next election.
“It’s all part of this rachetting up of tougher sentences, tighter remand conditions, less bail and taking less risk with people who commit serious offenses,” he added.
Asked if that meant there would be less room for tax cuts, he said: “I wouldn’t want to judge that because it is a bit early, but certainly spending this kind of money on prison capacity is going to reduce other options.”
The inevitable cost of tax-cuts
As billions more is wasted on prisons, money spent on health, education, housing, and other social services is being frozen; cut back, or not keeping pace with inflation.
This has resulted in appalling cuts to services such as recently experienced by 96-year-old Horowhenua woman, Trixie Cottingham;
Other social services have also been wound back – as previously reported by this blogger;
Cuts to the Health budget have resulted in wholly predictable – and preventable – negative outcomes;
A critic of National’s under-funding of the health system, Phil Bagshaw, pointed out the covert agenda behind the cuts;
New Zealand’s health budget has been declining for almost a decade and could signal health reforms akin to the sweeping changes of the 1990s, new research claims.
The accumulated “very conservative” shortfall over the five years to 2014-15 was estimated at $800 million, but could be double that, Canterbury Charity Hospital founder and editorial co-author Phil Bagshaw said.
Bagshaw believed the Government was moving away from publicly-funded healthcare, and beginning to favour a model that meant everyone had to pay for their own.
“It’s very dangerous. If this continues we will slide into an American-style healthcare system.”
As the public healthcare system faces reduction in funding – more and New Zealanders will be forced into taking up health insurance. In effect, National is covertly shifting the cost of healthcare from public to private, funding the public/private ‘switch’ through personal tax-cuts.
Tax dollars have previously been allocated to social services such as Education or Health. By implementing tax cuts, those “Health Dollars” become “Discretionary Dollars”; Public Services for Citizens becomes Private Choice for Consumers.
And we all know how “well” that model has worked out in the United States;
(Yet another) Broken promise by Key
But equally important is that, in promising to spend the government surplus on tax-cuts, Dear Leader Key has broken yet another of his promises to the people of New Zealand.
“The Government is committed to maintaining National Superannuation entitlements at 66 per cent of the average wage, to be paid from age 65.
The suspension of automatic contributions will remain until there are budget surpluses sufficient to fund contributions. Under current projections, the Government is not expected to have sufficient surpluses for the next 11 years.
Once surpluses sufficient to cover automatic contributions return, the Government intends to contribute the amount required by the Fund formula.”
“We’re managing government spending carefully, the economy is improving a bit faster than we expected, and that means it’s six years instead of 10 years until we start making contributions to the fund. If the economy picks up a bit faster again, we’ll get to that point sooner.”
In 2011, John Key said;
“Once we’re back to running healthy surpluses, we’ll be able to auto-enrol workers who are not members of KiwiSaver, pay down debt and resume contributions to the Super Fund.”
“The Government’s target is to return to surplus by 2014-15 so that we will then have choices about repaying debt, resuming contributions to the New Zealand Superannuation Fund, or targeting more investment in priority public services.”
“It remains our intention that contributions will resume once net debt has reduced to 20 percent of GDP, which is forecast for 2020.”
“… In this Budget we will have a paper-thin surplus , I mean we’ll just have a surplus but that’s the beginning of a series of surpluses and that means we have choices. And there’s a lot of choices. We’ve got the New Zealand Super Fund to resume contributions, an auto-enrolment for KiwiSaver, paying off debt more quickly, something for households to help them along. Those are choices that New Zealand fortunately will have if we have a growing economy and we stick to being pretty careful about our spending.”
In 2015, Key and English issued a joint statement saying;
“Through Budget 2015, the National-led Government will…
Reduce government debt to less than 20 per cent of GDP by 2020/21 when we can resume contributions to the NZ Super Fund.”
“There has not been any broken commitment regarding the Superannuation Fund. We have said for some time that when the Government returns to a sufficient budget surplus and can contribute genuine savings rather than borrowing, National will resume contributions to the New Zealand Superannuation Fund. The straightforward issue is that even when the Government shows surpluses under the operating balance before gains and losses measure, it does not always have cash surpluses until those accounting surpluses get reasonably big.
I remember that Sunday in 2009 in vivid detail, in fact, and constantly go back to it. The Government has outlined its position many, many times since 2009, and when there are sufficient surpluses and when we have debt down to the levels we think are prudent, which is 20 percent of GDP by 2020, then we will resume contributions, which we would like to do.”
In every year since National ceased contributing to the NZ Super (“Cullen”) Fund, both Key and English have reiterated their committment to resume payments when government books returned to surplus.
By hinting at tax cuts instead, Key and English have broken their promises, made over a seven year period.
Even their “qualifyer” of resuming contributions “when we have debt down to the levels we think are prudent, which is 20 percent of GDP by 2020” becomes untenable with their hints of an election-year tax-cut bribe.
By cutting taxes instead of paying down debt, resuming contributions to the NZ Super Fund is pushed further out into the dim, distant future.
The very suggestion of tax cuts is another potential broken promise. What’s one more to add to his growing list of promises not kept?
After all, there is an election to be fought next year.
Since National has not thought twice at under-funding the Health Budget, it certainly does not seem troubled at using tax-cuts as an election bribe, and undermining this country’s future superannuation savings-fund for selfish political gain.
Muldoon did it in 1973 – and got away with it.
Beehive: National ignores inflation warning
NZ Herald: Key – $30b deficit won’t stop Nats tax cuts
Fairfax media: $4b in tax cuts coming
NZ Treasury: Fiscal Indicator Analysis – Debt as at 30 June 2008
Dominion Post: Women’s Refuge cuts may lead to waiting lists
NZ Super Fund: Contributions Suspension
Beehive: New Zealand Super Fund – fact sheet
Fairfax media: English signals earlier return to Super Fund payments
Parliament Today: Questions and Answers – November 7
TV3 News: $23 billion in NZ Super Fund
Beehive: Budget 2015
Fairfax media: Compulsory super ‘would be worth $278 billion’
The Standard: The great big list of John Key’s big fat lies (UPDATED)
The Standard: The eternal tax-cut mirage
Previous related blogposts
This blogpost was first published on The Daily Blog on 27 Novembr 2016.
= fs =