English on the economy

January 4th, 2010 at 11:51 am by David Farrar

Bill English writes:

As New Zealand emerges from recession, the Government’s focus has firmly shifted towards significantly lifting our economic performance. …

Making changes that help permanently lift our economic performance will be the overriding focus of the 2010 Budget.

The tradeable side of the – exports and those industries that face international competition – has been in recession for five years, with output now some 10 per cent below 2005 levels.

That’s a great line – the tradeable side of the economy has been in recession for five years!

By contrast, the public sector has grown rapidly, but with poor productivity. That has lowered the economy’s overall productivity. Unless we can turn this around and create the right environment for businesses to compete on the world stage, we will not achieve the sustained increase in incomes the Government aspires to.

The rhetoric is spot on. We await the policies in the budget.

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33 Responses to “English on the economy”

  1. MikeNZ (3,234 comments) says:

    like a flat tax?
    and a much simpler tax regime.

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  2. Countess (150 comments) says:

    Hidden due to low comment rating. Click here to see.

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  3. Don the Kiwi (1,757 comments) says:

    I recall Heilen Klark’s comment when she was advised that Fisher & Paykell were having to move offshore because of anti- business legislation promoted by the Liarbore govt.

    She said, “It’s inevitable that some of our industries will move offshore, and ther’s not much we can do about it”. (or words to that effect)
    What a typical head-up-arse socialist comment.

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  4. side show bob (3,660 comments) says:

    Countess “Good to see English acknowledging the stimulus spending of Liarbore which has kept us out of a deep recession”, very good countess, still sucking on those Christmas cocktails are ya. I’m sure my bank manage will have a large smile on his face when I explain I’ve OD to the max because I was stimulus spending. I’ll just direct him to people like your good self who live in La La land. Sorry Countess but your socialist, stimulus spending, mates should be shot at dawn, fucking crooks.

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  5. wreck1080 (3,917 comments) says:

    Show me the money boss … all I hear is yakka yakka yakka.

    Nothing substitutes for a tax cut.

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  6. reid (16,468 comments) says:

    Countess, why did Liarbore do this?

    “By contrast, the public sector has grown rapidly, but with poor productivity.”

    Not to mention the interest-free student loan bribe. Cullen knew all this was bad news for the economy, but he went ahead and did it anyway.

    This didn’t benefit all of us, it benefited specific narrow sector interests that were naive enough to vote Liarbore. Unfortunately for all of us those narrow sector interests were inhabiting the non-productive sectors.

    Face it, either the 5th Liarbore govt was incredibly thick, or it was evil, because it acted throughout its term in a totally partisan manner. There is no third alternative.

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  7. Redbaiter (13,197 comments) says:

    Socialists shuffling the deck chairs.

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  8. Don the Kiwi (1,757 comments) says:

    reid.

    I’ll go with evil – it was the most corrupt govenment this country has ever seen.

    It was not incredibly thick, but incredibly devious. The introduction of the Electoral Finace Act and the purchasing of the trainset at the end of their term was nasty, as they must have known that they were going to lose the election, but did it anyway to make it difficult for incoming National.

    Selfish, spiteful narcissistic arseholes.

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  9. redqueen (563 comments) says:

    Reid

    ‘There are few developments which give one so much cause for doubt concerning the ability of democratic government to act rationally or pursue any intelligent designs, once it throws principle to the wind and undertakes to assure the status of particular groups.’

    What was true in 1960 is true today. We seem to rather enjoy having contradictions and doing things for narrow sectional advantages.

    The fun bit is that while I respect English, he seems far to timid to actually address anything at the moment. The last budget, which I rather enjoyed live, dealt with things which had to be dealt with (not borrowing ourselves into oblivion). What the next budget does, and specifically what it looks at abolishing, is what we should be concerned with. That he seems to realise this is a good sign, but given that he and John Key have been very resistant to any proposals to change the current system is a worrying sign.

    It really will be interesting to see this years budget, particularly if it signals, going forward, some structural changes that do more than just play lip service to productivity. As I’ve said before, I think there’s something more engrained in our society against productivity than just Government, but I think simplifying things yet further will leave it in our (the workers) hands to deal with, rather than trying to super-impose ‘solutions’ downwards.

    That said, at least he’s admitted government work is low-productivity. I just wish they’d start looking at what used to be called ‘invisibles’, rather than solely talking about ‘tradeables’, which should include services.

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  10. Countess (150 comments) says:

    Hidden due to low comment rating. Click here to see.

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  11. reid (16,468 comments) says:

    “The ‘trainset’ you refer to is vital to the economic infrastructure of the country. Would you like to tell the South Island to drop dead since the Cook Straight ferries, part of the ‘trainset’ deal would have been sent off to the Med or Indonesia.”

    Evidence please Countess re: ferries leaving NZ. And why was it vital for the govt to not only buy it but to pay a hugely inflated price, using our money?

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  12. redqueen (563 comments) says:

    Countess

    What a load of tripe. That National hasn’t reversed, in just over a year, Labour’s policies isn’t surprise (even if it’s unfortunate). The difference is that they haven’t announced a series of massively expensive, futile, and socially destructive ‘initiatives’, ‘plans’ and ‘objectives’. There has been far more dilly-dallying than I would prefer, but the economy has been treated far better than Labour would have, if nothing else seen by the fantasies they’ve proposed, and we are at least in a position now where the Government admits there is even a tradeable sector to worry about.

    So, on the whole, I would say we’re far better off than another three years of loonydom.

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  13. Sonny Blount (1,782 comments) says:

    Redqueen,

    I think the real problem is the NZ voter, National are understandibly cautious about the level of leftist indoctrination thoughout the country after the last decade and are pitching to the middle. I hold a vague hope that they mean it and 2010 will see some changes of substance as I would prefer to see a 3 year Douglas style crash and burn, rather than winning a second term and doing nothing with it. But changes need to be made in such a way that Labour won’t just unwind them in their next term, they were excellent at this with WFF etc.

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  14. Countess (150 comments) says:

    Beacaus e that is what happened to the old ones. Dont foget the rubbish National bought for the Navy, the Charles Upham which was a lemon in every sense of the word, went back to the Med, where it should have stayed.
    The reason why was that The Govt had ‘bought’ the tracks and it was an absurd situation where they couldnt agree over the price Toll would pay for their trains to use them. AS well the business was bought from its owners, which was a fair price . Not the inflated one using numbers that were taken out of thin air and added on later.

    Thats whats its called when you say things that you dont back up- Bullshit. There have been minor things National has reversed ( duh) so there is nothing stopping them. Other some quaint view that they were were for after they were against it.

    Of course if you repeat bullshit often enough a certain segment of the population will praise you for it. !

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  15. malcolm (1,952 comments) says:

    I recall Heilen Klark’s comment when she was advised that Fisher & Paykell were having to move offshore because of anti- business legislation promoted by the Liarbore govt.

    She said, “It’s inevitable that some of our industries will move offshore, and ther’s not much we can do about it”. (or words to that effect)
    What a typical head-up-arse socialist comment.

    She was correct. F&P’s Global Manufacturing Strategy is what all their competitors have done – moving to countries with much cheaper labour and closer to their markets. Even if NZ became the most business friendly country in the world, our labour rates would still be too high for making washing machines and dishwashers.

    John Bongard, Fisher & Paykel Appliances CEO and Managing Director cited ongoing manufacturing cost escalations, particularly in New Zealand and Australia, as the main reason for relocating production.

    “All of our competitors globally are currently manufacturing in low-cost labour countries. Our products are innovative and high end, but unless we can reduce some of the cost disparities in the manufacturing process, particularly the cost of labour, we will not be able to continue to provide an adequate return to our shareholders.”

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  16. Sonny Blount (1,782 comments) says:

    Countess,

    Which policies of Roger Douglas and Ruth Richardson did Labour reverse in their 9 years?

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  17. redqueen (563 comments) says:

    Well, I am not hoping for a ‘crash and burn’ scenario. I think if they manage to produce some sensible policies this time, and start chipping away at the entrenched idiocy of the past, they might maintain centralist support from people like me. What’s important is that they actually start to make some changes and move away from simple austerity (which works when you are on the line, but doesn’t look so flash when there are things to actually be done). If we don’t start seeing productivity, tradeablility, and participation rates rising, or at least initiatives to stop government interference with natural developments, then they may start to lose the support which has made things possible for this Government. I do not presume myself to be the ‘average voter’, or even the ‘average central voter’, but I do think it would be good to keep centralists on their side, and that requires action, not simply resting upon a leftist status quo.

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  18. Countess (150 comments) says:

    Ha ha that easy, National reversed Ruth Richardson itself as they got the fright of their life. As was normal National crashed and burned their big majorities after 3 years so she was sacked. Just as Labour sacked Douglas. The only two finance ministers to have lost their jobs in recent memory.

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  19. Fisiani (1,039 comments) says:

    Bill English will deliver Budget 2010.
    I will either be a steady as she goes budget or it will be an economy shifting budget.
    He will be constrained by a global recession of 2 years and a tradeable side of the economy in recession for 6 years. He will be constrained by a scorched earth spending spree by the outgoing government that verged on treason.
    He will be constrained by keeping the promises that were made in 2008 for National are honest.
    Despite all this I believe it is time to appreciate that the way we do things is not working. It cannot work. It needs to be FIXED. It needs to be REFORMED. It needs to be IMPROVED. It needs to be CLEVER. It needs to be NEW. It needs to be POWERFUL. It needs to be WHAT NEEDS TO BE DONE.
    It should not just signal, it should change. It should convince the people to accept that the protected policies of 2008 will not suffice for 2018. It should set up the structures for real growth and prosperity and shed the silly wasteful non productive spending inherited from the traitors.
    Politically is is hard to push change. People who receive funding from other taxpayers such as civil servants, students and WFF beneficiaries have a vote. So too do their families. Personal interest can outweigh the national interest. It’s a version of the Stockholm Syndrome where those who have taken prisoner begin to takes sides with their jailers. They need to understand the crucial imperative for reform. The good news is that everyone, however, understands economics at a basic family level. We all know you cannot keep increasing an overdraft indefinitely. You have to look at both income and expenditure. Sometimes with the assistance of a budget adviser. The greatest changes come when you simultaneously raise income and reduce expenditure. This should and will be the outcome of Budget 2010 which will be called The Recession Busting Budget or perhaps the cartoonists will call it the Phoenix Budget.
    Either way it will be a Landmark. The first of 10 National Budgets that will transform New Zealand into the Powerhouse of the Pacific.

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  20. redqueen (563 comments) says:

    And if that isn’t an indictment, Countess, against the quality of voting and the muppets we elect for things like, oh, say, 9 years (until things get to the point where we can’t take it anymore), I don’t know what is.

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  21. Manolo (13,780 comments) says:

    Very nice rethoric and lofty words from English, but it’s now time for action and to walk the walk.

    The 2010 budget is English’s last chance to show the current government is different from Clark’s; and to signal differences between its policies and the socialists’. If English misses or underdelivers there will be no further doubt that Key’s National government is only killing time without serious intention of improving NZ economy.

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  22. Adolf Fiinkensein (2,903 comments) says:

    ‘Fancy Kiwiblog getting a preview of the article English ‘authored’ a few days ago. ‘

    Will somebody please tell toe dosey bitch the article was printed in this morning’s Herald?

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  23. CharlieBrown (1,012 comments) says:

    Countess: “If Labours policies are so bad why hasnt National dropped every single one? ”

    Good point, I can’t think of many labour initiatives that National considered to be piss poor whilst in opposition that they are
    undoing now. Eg, Property relationship laws (default de-facto relationships), ACC nationalisation, tax increases, WFF, employment relations act, Kiwibank, changes to state-housing, scrapping the defense force, creating numerous more ministries and departments.

    In fact, I don’t even see national making any headway into decreasing the percentage of GDP generated by the state sector. This National government so far is the spiritual successor to the last Labour government, it really isn’t a new government in the sense of policy, its a new government in people only.

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  24. Dirty Rat (504 comments) says:

    Any ideas when Blinglish will change his name by deed poll to Jonathon Hunt ?

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  25. jaba (2,142 comments) says:

    how on earth can an incoming Govt simply reverse all bad policies from the previous Govt just like that? goodness me.
    I have decided to rest myself from Redalert due to dumb arse comments like those Countess is putting out there.
    I tried to offer semi neutral solutions but they don’t want to know .. mind you, if anyone wants to check out the tread about the Greens you will see some amazing opinions .. did you know that the nats front bench is doing ok becuase of the preduices?? of middle New Zealanders?

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  26. freethinker (691 comments) says:

    Reid
    Face it, either the 5th Liarbore govt was incredibly thick, or it was evil, because it acted throughout its term in a totally partisan manner. There is no third alternative.

    Sorry to disagree Reid – Labour was thick & evil Vis the troika of Clark Cullen & Wilson.

    As for Kiwirail – it may be possible to argue it was a necessary strategic purchase what is probablly impossible to argue is paying a gigantic premium over its owners own valuation as shown in the balance sheet – but perhaps our failed history teacher couldn’t read a balance sheet and followed his own egotictical brain fart than the advice of experts.

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  27. CharlieBrown (1,012 comments) says:

    “how on earth can an incoming Govt simply reverse all bad policies” – A good start would be to stop explicitly ruling out making all the changes required.

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  28. Whafe (650 comments) says:

    Countess (92) Says:
    January 4th, 2010 at 2:20 pm
    The ‘trainset’ you refer to is vital to the economic infrastructure of the country. Would you like to tell the South Island to drop dead since the Cook Straight ferries, part of the ‘trainset’ deal would have been sent off to the Med or Indonesia.

    As a country we are well fucked when you have brain dead idiots whom still to this day believe that a Trainset can be viable in NZ…. So who is going to make the approx 160 tunnels from Auckland to Wellington bigger to fit the new high cube containers etc etc etc etc…

    Seriously, I am fearful with these types of brain dead clowns even speaking in public….

    Lefties make me piss blood

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  29. BlueDevil (92 comments) says:

    If the Tranz rail Cook Strait Ferries were scrapped we would just have to use the private company ferries Bluebridge.

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  30. Whafe (650 comments) says:

    freethinker – there was nothing what so ever strategic in purchasing the trainset. If you seriously think logically about it, you will not be able to come up with a strategy that shows it was a good worth while purchase… It was a gutter trick played by Klark and her Clown Pants team, they knew they were not going to win the election….

    Over time, trust me, the last Labour government will be shown to be corrupt evil so in so’s….

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  31. bchapman (649 comments) says:

    So his solution is to sack a few public servants- which will do 2/5ths of stuff all. If he were really interested in improving public service productivity he needs to get more specific. What performance measures are they using? Are the upgrading public sector technology and systems? From what I have seen they operate with pretty ancient computer systems all run from Wellington.
    Unless they train and upgrade the systems, training, performance monitoring and technology available to public servants I doubt he will be able to improve public sector performance one iota.

    But how would you know? He states no aims, specifies no performance measures and fails to mention the most important component of public or private sector productivity- people. The article contains cliche after cliche and never gets beyond generalities. It could have been written in the 1960s with the New Zealand bits added in.

    DPF- can you start asking harder questions of our pollies?

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  32. jackp (668 comments) says:

    bchapman, the argument you make about up to date technology won’t work. IF, if if, that never works when it comes to the public service sector. You are right about one thing, it is about people. These are administrators who get hired for some reason like cronyism, someone gets a “brillliant” idea, someone without experience in management positions and so on. These administrators are going to justify their jobs by adding more public servants and the cycle keeps growing. They use the same “IF ONLY WE HAD” policy which usually doesn’t work. After all, they are spending a third party money (taxpayers) and are not held accountable. Taxpayers don’t have a clue what is happening. After awhile you start to see the horrific results such as primary schools’ sewage and building collapsing after repeated efforts by the principal to get some help. I can’t remember the name of the school but it was very pathetic. The ministry of education only defense was the principal didn’t fill out the forms properly. The book of rules that he was suppose to follow and did was about 30 thousand pages long contrived by administrators. Meanwhile the children walk in their own shit and smell outside of their poor condition classrooms. Closeup did a feature on it. There are more administrators in the health sector but the waiting list continues to grow.

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  33. Matt Long (90 comments) says:

    Going back to the Tradable sector shrinking for the last 5 years, English earlier said that this was due to the dollar being at historically high rates which provides a signal to pull investment from areas where international competition occurs.
    While our dollar is high no amount of reshuffling deck chairs is going to get our economy sustainable growing.

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