Finance Minister, Bill English, deserves congratulations for his determined focus on balancing the government’s books. It’s taken six years but he is just about there. Also the government has taken some positive initiatives for example extending free GP visits to under 13s – a very helpful step towards improving outcomes for New Zealand’s young people.
However there is still more to be done, regardless of which party controls the treasury benches, after September. In the Health area alone we need to measure the reduction in rheumatic fever cases to ensure that new policy programmes are being effective – particularly for low income households. We need to make faster progress on health initiatives such as extending bowel cancer testing, reducing inequality and taking steps to reduce obesity. We also need to do more to reduce tobacco consumption, drug and alcohol abuse.
On the debt levels in the budget:
1. The government budget surplus is not actually a surplus. At least not yet. It’s a small forecast surplus for next year – 2015-16 – that is 12 months after the election.
2. In fact the 2014-15 current year budget shows the government spending $73.1billion for the year. Its total income from all sources is $72.5billion. This is a deficit of approximately $600million. (p.A4 Dominion Post 16/5.2014)
3. In 2008, crown debt was $10 billion – now it is $60 billion. That’s just the government debt – not the total overseas debt owed by the nation. Our debt as a nation – NZ’s net international debt position – was $141.2 billion at March 31, 2014.
The government has also postponed auto-enrolment in kiwisaver worth up to $290 million. We will need to start re-investing in kiwisaver if we’re going to deepen NZ’s capital markets and reduce reliance on overseas funding. So overall the move towards budget surplus is a big achievement but it would be wrong to assume we can afford a big spend up after the election. We still have urgent social challenges to be addressed and kiwi households and businesses still have very high levels of debt – which means the government debt needs to be reduced further to give us a buffer if there is another oil shock or natural disaster. The challenge for 2014-17 will be keeping on a path to ongoing surpluses to pay down debt – while also investing to tackle urgent social challenges at the same time.
Tax cuts, increased defence spending, poor quality or no regulation and cuts to public health, education and social security were the simplistic recipe sold by Margaret Thatcher in the UK in 1979, by Ronald Reagan in the US in 1980 and by Roger Douglas in New Zealand in 1984.
This interesting video clip sets out the problems with Reaganomics. In brief government and national debt went up, government services were reduced, unemployment rose and the manufacturing base was offshored.
The Conservatives are still well below the 5% threshold and would be reliant on an electorate gifted by National. Colin Craig, Conservative Party Leader, seems like a likeable chap. Contrary to some conspiracy theorists I do not see him as a “fundamentalist zealot” wolf in sheep’s clothing.
The more important question, however, is whether the policies espoused by his party are credible and whether they will make a positive difference on the issues that matter for this country. For example their commitment to Citizen Referenda sounds admirable but would its MPs agree to abide by the results of binding referenda – even where it directly contradicted the party’s own policies?
It’s opposition to Privatisation is interesting but frankly one must question how meaningful such a policy will be by early 2015. Most of the saleable public assets will have been sold down to 51% by then. Even if National still has one or two more assets to sell (or wanted to sell the remaining 51% of shares in mixed ownership companies) – are the Conservatives really saying they would bring down the government over such issues?
As for environmental protection the Conservatives seem to be in the “development is always good” camp – even if that means overturning environmental safeguards. It favours weakening the Resource Management laws in favour of development – especially in Auckland. The most important question is what are the top three “non-negotiable” policies for the Conservative Party and how different are they from the National Party view? The answer to that question reveals what is truly important to this party.
The new ACT leader – formerly a philosophy lecturer at Oxford University – has made comments which could alienate egalitarians and Christians. In defending public comments supporting incest Mr Whyte has moved well beyond ACT’s policy position and into his own views. His attacks on Christians and Catholics in particular won’t help build electoral support for a party which used to have conservative voters. Mr Whyte also seems set to alienate corporates who believe in philanthropy. I do not underestimate Mr Prebble’s organising ability. But there is a real prospect that ACT is about to find out the genuine level of kiwi support for its policies. http://www.stuff.co.nz/national/politics/9777804/ACT-leader-Whyte-can-t-be-grey
French Revolution ousting absolute Monarchy.
The Economist recently published an essay on the state of democracy in the world. It shows that simply holding elections does not constitute a healthy democracy. In the UK political party membership has declined from 20% to 1%. In both established democracies and in new democracies fundamental questions are being asked about how to have a healthy political democracy which can avoid the excesses of selfish majoritarianism.
I would have also liked to have seen more on the excesses of inequality as an erosion of economic democracy but this essay is worth the several pages of reading. http://www.economist.com/news/essays/21596796-democracy-was-most-successful-political-idea-20th-century-why-has-it-run-trouble-and-what-can-be-do?frsc=dg%7Ca&fsrc=scn%2Ftw_app_ipad
Neo Nazis on the March in Germany in 2012.
The Global Financial Crisis and its aftermath has breathed new life into long moribund extremist parties on the fringes of many European nations. For example, in Greece the Golden Dawn party gained 21 seats in the 300 seat Parliament during the May 2012 election. According to the Greek Political Review :
“One of the two pillars of the contemporary party system (Pasok – centre left)) has imploded while the other (New Democracy centre-right) is struggling to cope with pressures from above and below.”
“A party of the radical left (Syriza) got its highest share in history and came close to winning an election. Extremism is here to stay with the neo-Nazi Golden Dawn maintaining its share of the vote despite being implicated in highly visible incidents of violence. And while Greece is struggling to balance its commitments to its lenders with soaring unemployment, crime and social malaise, political leaders are facing the need for a shift to a new political culture of coalition governments and power-sharing.”
In Germany a well-organised NPD is gathering support on a platform of withdraw from the EU, replacement of the Euro with the Deutschmark, and repatriation of foreign criminals. The NPD party gained 7% of votes.
In Austria the nationalist Freedom Party in 1994 won 33 percent of the vote in Carinthia region and 22 percent in Vienna, showing that it had become a force capable of reversing the old pattern of Austrian politics. In the 1994 Austrian election, the FPÖ won 22 percent of the vote. With the death, through a traffic accident, of its leader (Hader) in the early 2000s the Freedom Party lost its momentum. But many other smaller neo Nazi groups continue to operate either legally or underground.
The failure of social democratic (or conservative) parties to respond to the fears and concerns of lower-middle class and working class communities – especially in provincial and rural areas leaves the door open to far right groups to develop. One of the lessons of history is that in the midst of an economic crisis if the major parties lose the confidence of large segments of the population then extremist groups tend to emerge.