“Labour is the party of economic competence”

Anthony Robins makes a case at The Standard that Labour is the party of economic competence.

The old myth that National are good managers of the economy should now be well dead and buried. By any realistic assessment of the records of the last two governments, Labour is the party of economic competence.

Labour: 9 surplus budgets, paid down net government debt to zero, established the Cullen fund, KiwiSaver, KiwiBank and emissions trading scheme, low unemployment, negotiated a successful free trade agreement with China, and so on.

National: 7 deficit budgets (so far), ran up record government debt, sold productive assets, made significant losses by cutting Cullen fund contributions, gutted the emissions scheme, got taken for a ride by Hollywood, Sky City and Rio Tinto, higher unemployment, is negotiating a disastrous TPP, and more.

There’s some valid points there, but also some questionable ones. And some significant omissions, for example Kiwirail, and the fact that the New Zealand economy was heading into difficult times while Labour was still in Government, having committed the country and the incoming National Government to significant increased spending.

There’s certainly things National can be criticised for, but “made significant losses by cutting Cullen fund contributions” is nonsense, and the Hollywood deal can be credited in part for improving tourism which is one of the countriy’s biggest earners now.

Labour needs to highlight the issue of economic competence next election (with any luck the media will do their job too and fairly present the facts). It is supposed to be a core National strength, but any clothes that emperor ever had are long gone now. National is vulnerable.

Robins looks back to the Labour Government led by Helen Clark and Michael Cullen. They were voted out in 2008, seven years ago.

National aren’t judged on the Bolger Government, or the Muidoon Government.

Of course National is vulnerable, especially if the economic situation worsens or doesn’t improve much.

But Bill English is widely seen as a very sound Minister of Finance who has managed the economy through very difficult times. If he remains then National may still look economically reliable. If not it National will have to look like they have got a comparable replacement.

Sure “Labour needs to highlight the issue of economic competence” – but Andrew Little and Grant Robertson have to do quite a lot of convincing yet about perceptions of their economic competence. If they are still leader and Finance Spokesperson at the election.

And absent any poll recovery miracle Labour still have to grapple with how economically competent Labour+Greens looks, or Labour+Greens+NZFirst looks.

They’ve got plenty of time. It’s two years until we head into the next election campaign.

But they’ve had plenty of time. It’s nearly seven years and four leader/finance spokesperson combinations since Labour lost power.

Before Labour is seen as ‘the party of economic competence’ they need to be seen as a party that can competently manage itself.

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11 Comments

  1. Kevin

     /  19th August 2015

    Typical cherry-picking by The Standard. To get an accurate assessment of who is more economically competent you need to go back more than two governments and you have to put things in context. Obviously a government that achieves 1% economic growth while the world average is say -5% is more economically competent than a government that achieves 5% economic growth when the the world average is for example 10%.

    Reply
  2. Brown

     /  19th August 2015

    You can compare Labour to Fonterra. Its easy to look good when things are going swimmingly but a much harder trick to look good when things have turned to crap.

    My understanding is that when National took office Labour had already blown the surplus from the good years. In my view neither are much good really but we are seeing that socialism is not the thinking people’s darling so Labour will have to think again.

    Reply
  3. Budgieboy

     /  19th August 2015

    I agree with what’s already been said.

    What simplistic drivel from AR! Simplistic boardering of dishonesty in my opinion.

    NZ Labour led the world into recession – and that was before the GFC.

    They handed us the infamous projection of a ‘decade of deficits’ and then the GFC hit as well as the Canterbury earthquake, can you imagine what might have happened if Labour had been left to steer us through that?

    Reply
    • kittycatkin

       /  19th August 2015

      I don’t agree that they led the world into recession-NZ’s far too small to do anything like that-but they did, in years gone by, have artificially low unemployment by employing people who did very little, as in Railways. It is bordering on dishonesty-and in places crosses the border !

      Reply
      • Budgieboy

         /  19th August 2015

        You’re right KC we didn’t lead the world in terms of influence, what I meant was we were first to get there. We did that under the previous governments leadership all by ourselves – and prior to the crash the lead to the GFC. Other countries were able to ‘blame’ their problems on the GFC but not us, we had ‘the party of economic competence’ to thank for that. When the GFC hit it was a double whammy for an already sick economy.

        Reply
  4. Mike C

     /  19th August 2015

    Typical biased bull-shit from the Standard.

    I look forward to the day when one of them writes a post that isn’t anti-National and totally pro-Labour.

    That is where the Standards problems lie, with not allowing a greater range of views from their Posters and Commenters.

    They would have a much more successful Blog if they diversified, and people like me would no doubt be tempted to contribute if the subject matter and moderating wasn’t such a one way street 🙂

    Reply
    • Kevin

       /  19th August 2015

      Have a look at the comments section. Anyone who challenges the author gets pounced on and ridiculed by the resident trolls. Though the way Gormless plays with Smaug is pretty funny.

      Reply
  5. Andrew

     /  19th August 2015

    “9 surplus budgets, paid down net government debt to zero, established the Cullen fund, KiwiSaver, KiwiBank and emissions trading scheme, low unemployment, negotiated a successful free trade agreement with China, and so on”

    A group of blind monkeys could have run 9 budget surpluses over that decade, hell, maybe even the Greens could have. Although that would have been a stretch.

    That was the decade of a private debt fueled boom created off the back of 110% nationwide housing inflation and massive over-taxation of the middle classes. Cullen’s envy tax was only ever supposed to be paid by the top 5% of the population, and ended up being paid by more than 30%.

    All that public debt that disappeared (net debt to zero bollocks) just reappeared as private debt. In the last 5 years of the Clark govt, government expenditure increased by 50%. No wonder we have 100 billion in debt now.

    The current govt is doing what it should be doing, being very careful and tight with it’s spending, doing more for less. Labour left NZ on track for Debt to GDP of 60% by 2021-22, and it would be over 40% by now per 2009 settings.

    National maintained Net Transfers through the GFC, have protected the most vulnerable, and have still reduced debt to GDP to mid 20’s now. Talking about too much spending in the same breath as ‘cuts to public services’ is both illogical and also wrong.

    I have zero respect for persons who attack the govt for incurring debt, that’s what governments should do. The only other solution is it slash spending. Good-o.

    Reply
    • Howick Boy

       /  19th August 2015

      Do you think that the tax cuts contributed to the debt?
      Also you can’t blame the Govt for private debt

      Reply
      • Andrew

         /  19th August 2015

        For sure the tax cuts contributed to the debt, at about 1 billion a year as i recall. They were designed to be fiscally neutral, so we will see how that goes. But giving people back some of their own money to spend into the economy is not a bad thing. Neither was reversing Cullen’s envy tax from the middle classes.

        I wasn’t blaming the government for private debt at all. But the economy was booming on increased private debt, not reduced public debt. Debt is debt, be it public or private.

        Reply
  6. John Schmidt

     /  19th August 2015

    I read the standard article and could not believe the tripe. The reason the previous labour government was considered a success and why it was reelected was because of the competence of Clark and Cullen. The current Labour lineup has absolutely nothing to compare with this team. Do people really believe that Little and Robertson are equivalent to Clark and Cullen as a famous Aussie once said “they must be dreaming”. As highlighted through this thread they are totally different times, Labour had the luxury of the best of times during their term verse the huge hurdles the current government has had to deal with in addition to the significant financial commitmits that Labour had begun. Then there is the elephant in the room Labour cannot govern without the Greens and nowhere in the world has there ever been a financially competent Green parliament. I cannot believe that there are people who think there is a team in opposition who can out perform the current government.

    Reply

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