OnPoint by Keith Ng

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OnPoint: PREFU 2011: "What credit downgrade?"

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  • Bart Janssen,

    macroeconomagical growth powers

    That so has to be in the next PAS story.

    It does seem to me that National are a little bit caught by surprise that they will get a second term. All their budgets promised that sometime (somehow) in the next 3 years things would get better. Now they realise that they will be in power for those 3 years.

    Of course if we hadn't cut taxes maybe there might not have been so much pain coming - just sayin'

    Auckland • Since Nov 2006 • 3349 posts Report Reply

  • Sacha,

    Magic beans. Clearly the answer.

    Ak • Since May 2008 • 16614 posts Report Reply

  • Geoff Lealand,

    But I thought the majority of debt is private debt?

    Screen & Media Studies, U… • Since Oct 2007 • 2307 posts Report Reply

  • Sacha, in reply to Geoff Lealand,

    Let's not allow facts to intrude on the beanery..

    Ak • Since May 2008 • 16614 posts Report Reply

  • BenWilson, in reply to Bart Janssen,

    It does seem to me that National are a little bit caught by surprise that they will get a second term.

    You reckon? I think they made it so quite deliberately. And I'm pretty sure they haven't abandoned their hopes to cut the crap out of the budget, they just figured that if they do it in a second term, then that's another whole term that Labour isn't in power. That they will quite possibly have an increased mandate means they can cut all the deeper, quite aside from the fact that it would make fiscal sense (so long as raising taxes is impossible, as they would have us believe).

    Auckland • Since Nov 2006 • 8500 posts Report Reply

  • merc,

    "Higher saving means lower consumption and lower growth in the short-term."
    Says it all really.

    Since Dec 2006 • 2471 posts Report Reply

  • Steve Barnes, in reply to Bart Janssen,

    It does seem to me that National are a little bit caught by surprise that they will get a second term.

    Damn, did I miss the election?
    Hmmm. Nope. Bart get your head out of the toilet.
    Nactional don't have a hope in hell of winning fair and square and hopefully the slimeball tactics will backfire.

    The wireless north ;-) • Since Dec 2006 • 4820 posts Report Reply

  • Steve Barnes, in reply to Geoff Lealand,

    But I thought the majority of debt is private debt?

    It was, was being the operative word.

    The wireless north ;-) • Since Dec 2006 • 4820 posts Report Reply

  • merc,

    Bill has been borrowing.

    Since Dec 2006 • 2471 posts Report Reply

  • Jackie Clark,

    It will hurt? Gee, Bill, since when does National being in power ever indicate anything but that there will be pain. Perhaps this was news to some? Good grief.

    Mt Eden, Auckland • Since Nov 2006 • 3123 posts Report Reply

  • Mike Graham,

    National’s “Brighter Future” is starting to sound like Muldoon’s “light at the end of the tunnel” – in the latter case it was a train coming in the other direction.

    Auckland • Since Nov 2006 • 201 posts Report Reply

  • George Darroch,

    It makes me hopeful that debt is more than just a handy boogeyman for the Government, and that they are willing to expend some political capital to actually govern.

    You and I wish for very different things. They’re going to expend that political capital by cutting basic services that have large positive externalities, so that some rich [insert derisory term here] with a view of the water can build a larger swimming pool.

    The People's Republic of … • Since Nov 2006 • 2134 posts Report Reply

  • BenWilson, in reply to George Darroch,

    They’re going to expend that political capital by cutting basic services that have large positive externalities, so that some rich [insert derisory term here] with a view of the water can build a larger swimming pool.

    I think that is what will happen, but in some ways it's better than National steadily rising in popularity by talking about doing those things, without ever actually doing them, instead doing nothing but minor attacks on irrelevant things that they just don't like, while the economy grinds down, with all the negative externalities that is already having and will continue to have. The longer it goes on the harder it will be in the end. I thought that was Keith's point, that in actually doing something it will become clear that either they have the right plan or they don't, in which case we get rid of the [insert derisory term here]. This dawdling along slowly bankrupting the country by refusing to raise tax and claiming that as a virtue, while softening us up for asset sales, is some bullshit, and I know how it's going to end. I'd rather it began ending sooner.

    I hope even more that both Labour and the Greens (even more so) have a huge poll bounce leading into the election. But projections don't look good at this point.

    Auckland • Since Nov 2006 • 8500 posts Report Reply

  • Craig Ranapia, in reply to Bart Janssen,

    It does seem to me that National are a little bit caught by surprise that they will get a second term. All their budgets promised that sometime (somehow) in the next 3 years things would get better. Now they realise that they will be in power for those 3 years.

    Honestly, Bart, I think everyone has been hoping that things would get better - and I guess we can argue until the sun turns red how much of that was wishful thinking and how much was outright psychotic breakage.

    North Shore, Auckland • Since Nov 2006 • 11933 posts Report Reply

  • merc,

    1. The Fed is privately owned.
    http://www.globalresearch.ca/index.php?context=va&aid=10489
    oops wrong thread.

    Since Dec 2006 • 2471 posts Report Reply

  • Bart Janssen, in reply to Geoff Lealand,

    But I thought the majority of debt is private debt?

    One of the philosophical differences between left and right is that right believe private people should pay for (and borrow for if necessary) things like education, health care, earthquake insurance, boats to clean up oil spills. So National will shave public budgets and cut taxes expected the private sector (you and I) to pay for things. That will have the effect of shifting debt and the responsibility for it to the private sector.

    An extreme version of that philosophy is seen tin the US republican party.

    Theory says that but cutting taxes you stimulate the economy in general and eventually generate growth and hence more govt income. Unfortunately it didn't work in practice and some of the blame for that has been the GFC and the CHCH quake. But even excluding those economic impacts the effect of the tax cuts has been to make rick folks richer and make the public budget fall dramatically short in revenue.

    Faced with a shortfall in revenue there are simply two options get more revenue (raise taxes) or reduce spending (cut public sector budgets and jobs). Oh and you could sell assets but that is only ever a stopgap measure (like selling your car). I am excluding magic/economics.

    It seems to me that at a very basic level that is what this election is about. How do we balance our budgets. Vote National to cut public sector jobs and spending overall. Vote Labour to raise more tax revenue and keep public spending.

    There are a huge number of consequences to either of those choices. But at core it's a philosophical choice, a government that taxes you and then spends the money on your behalf or a government that lets you spend it for yourself and offers stuff all support if you can't make it work out.

    For me, I look around at the different systems used by countries around the world and see which works best for the people. Any of the Scandinavian countries can be used as a model for the former and the USA is the most extreme model of the later. It kind of makes the choice simple for me but other folks have a different philosophy.

    As for hoping things get better ... well I hope somehow this paper will magically get written and appear on my computer ... dammit

    Auckland • Since Nov 2006 • 3349 posts Report Reply

  • Sofie Bribiesca, in reply to Bart Janssen,

    As for hoping things get better … well I hope somehow this paper will magically get written and appear on my computer … dammit

    Bill has promised more public servants on the dole queue and as Duncan Garner mentioned on te News last night. 2000 jobs gone already ,ain't seen nothing yet. I think the Rena is a great ad for cutbacks to the outback. Shouldn't the campaign slogan be "more of the same" for Nactional.
    Give me a Don!
    Give me a Key!
    Oh it's a Donkey.
    Coat getting, places to go. :)

    here and there. • Since Nov 2007 • 6124 posts Report Reply

  • merc,

    Government spending was beginning to fall and 43,000 new jobs had been created in the past financial year; 20,000 more than predicted in this year's Budget.
    In May Treasury predicted 170,000 new jobs would be created over the next four years.
    English said its revised estimate of 150,000 new jobs recognised actual jobs were already ahead of its earlier forecasts.
    http://www.stuff.co.nz/business/industries/5848275/Treasury-confirms-Govt-on-track-for-surplus

    Is it me or does this not make any sense?

    Since Dec 2006 • 2471 posts Report Reply

  • Andrew C, in reply to Sacha,

    Magic beans. Clearly the answer.

    You’re not far wrong there Sacha, a quick scan of the radio shows yesterday arvo/eve had most business commentators scratching their heads at the PREFU’s widely optimistic views on the growth in the govt’s future revenues.

    Auckland • Since May 2008 • 144 posts Report Reply

  • merc,

    Ah thanks Interest.co.nz here's how much Bill has been and will be borrowing, http://www.interest.co.nz/bonds/56352/nzdmo-borrow-net-nz179-bln-government-over-next-5-years-mostly-201314-inflation-indexed-
    I hope he's not basing his borrowing on Treasury growth forecasts? 3% growth coming, yeah.

    Since Dec 2006 • 2471 posts Report Reply

  • Tom Semmens,

    Magic beans. Clearly the answer.

    This government really, truly, believes that the market will provide for all the corrections required and give us all a lovely soft landing when:

    Cheap fossil fuels run out.
    China’s economy tanks
    Australia goes into recession
    The European finance system collapses
    Aliens invade
    Zombie contagion affects most of the world
    Climate change means it doesn’t rain for three hundred years.

    Of course, this hands off, do nothing, blind faith in the neo-liberal God of the market doesn’t mean they take a huge pay cut and retire to their own homes in their electorates to do nothing.

    Auckland • Since Nov 2006 • 1805 posts Report Reply

  • David Cormack,

    The vitriol towards the National Government in this thread is palpable...surely we don't believe that they intentionally want to destroy NZ's economy? Whether or not you agree with their policies on anything, they must genuinely believe what they are doing is right for the country.

    Suburbia, Wellington • Since Nov 2006 • 216 posts Report Reply

  • Ian Dalziel, in reply to David Cormack,

    Fixed that for ya...

    ...they must genuinely believe what they are doing is right for the country.

    ...they must genuinely believe what they are doing is good for the country's Right.

    Christchurch • Since Dec 2006 • 4880 posts Report Reply

  • Steve Barnes, in reply to David Cormack,

    The vitriol towards the National Government in this thread is palpable…

    From Aotearoa: a wider perspective

    I met G. Edward Griffin recently, and had the chance to speak with him about our wealthy banker turned politician John Key, who was one of only four advisers to the Federal Reserve of New York from 1999 until march 2001. I described John Key’s career and told him that based on what I had learned about the Federal reserve I had my worries about his career chance and what it might mean for New Zealand to have a man who is such a wall street insider become the prime minister of our politically so naive country and he smiled and said, “let me put it this way; he is not an innocent, and he is probably prepared to sell NZ to his rich mates and throw in his mother with the deal. You can not go up as high he went in the banking world without becoming an insider.”
    I asked him would it be possible that he was groomed by his rich buddies to become the next prime minister of Resource rich New Zealand, and he answered, “It has been done before.”

    surely we don’t believe that they intentionally want to destroy NZ’s economy?

    Key and palls will be just fine.
    I do, however, suggest stocking up on Lube and practising grabbing your ankles.

    The wireless north ;-) • Since Dec 2006 • 4820 posts Report Reply

  • Craig Ranapia, in reply to David Cormack,

    The vitriol towards the National Government in this thread is palpable…surely we don’t believe that they intentionally want to destroy NZ’s economy? Whether or not you agree with their policies on anything, they must genuinely believe what they are doing is right for the country.

    Absent the majestic plural, I believe the answer to your questions is “yes’ and “no”. Meanwhile, over on Kiwibog et. al,, I'm sure the Liarbore Dykeocracy's cunning plot to make North Korea look like Gault's Gulch is being exposed as we speak...

    North Shore, Auckland • Since Nov 2006 • 11933 posts Report Reply

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