Labour’s Luck
February 19th, 2010 at 12:00 pm by David FarrarThis week’s Dispatch from St Johnnysburg for NBR 24/7 is on Labour. A couple of extracts:
Labour have had a good couple of weeks.
First of all, something has happened to Phil Goff over the break. He has come back a far more relaxed and engaging politician. Yes, his party’s supporters may still pine for Helen, but over time they may appreciate a less polarizing leader.
And on the tax issue:
Labour has been making waves on the GST issue. As the Government has yet to detail its tax package, Labour is doing it for them. They assume that the top tax rate will be dropped to 30c, and a pliant media report their scenarios that Telecom CEO Jack Paul Reynolds will get a tax cut of $150,000 a year and Joe Average will get a few dollars a week.
National needs the debate on tax to be about the macroeconomic effects – the desire to increase the incentives to work, to invest and to save and to reduce the incentive to borrow and consume. If the debate becomes one of simply who gets how much, they will have problems.
I conclude by saying the next set of public polls will give some idea as to whether the public have started to tune into what Labour are saying.
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February 19th, 2010 at 12:14 pm
I could be accused of bias but I agree with you DPF that Phil is performing way better than last year and really well.
And the Labour Party have had a great start to the year. This has been helped in no small part by some awful ministerial behaviour from the likes of Tolley, Brownlee, Coleman, Wong …
Key has made the biggest mistake however. He has raised expectations that everyone will be better off under proposed tax changes but it is clear that the rich will benefit at the cost of the poor. People will be disappointed and his reputation will be further tarnished.
The next poll will indeed be very interesting.
Vote:February 19th, 2010 at 12:16 pm
“I could be accused of bias ”
Who you?…..nah
Vote:February 19th, 2010 at 12:18 pm
I’ll just repeat my suggestions that the trust rate should be left higher than the personal tax rate. That will help to unwind all the unnecessary trusts, and ensure their assets are allocated for economic efficiency rather than tax efficiency. So I suggest Trusts: 35%, Personal Rate: 33%, Company Rate 30%.
The company rate could be dropped further if a payroll tax was introduced on payrolls over $100k. However, as this would apply to the civil service too, some compensation would be required to civil service budgets … otherwise it would effectively result in cuts to government expenditure. We wouldn’t want that now would we !
And while I’m on the subject of tax – the Tax Working Group looked at the asset base and net tax for residential property. They should have performed exactly the same analysis for dairy farms. Diarying is high leveraged, and so rather unprofitable … until there is a massive untaxed capital gain on disposal.
Vote:February 19th, 2010 at 12:18 pm
DPF is right – Goff has had a good start to the year. As a result, you’d have to expect that the polls would have narrowed to around Nat=50 and Lab=35, down to a 15 point gap. Anything less positive for Labour really would mean he has no chance of connecting with the public.
Vote:February 19th, 2010 at 12:18 pm
Not sure what is happening with the polls- but up in Auckland positions are hardening against Rodney Hide and the Supercity. Michael Barnett and Penny Webster are the latest two to give an earfull to ATA and the proposed CCO structure and the you hardly ever anyone say anything good about what is going on.
Of course were not talking about the average punters here, but there does eem to be an acceptance that things are not going well with the new Auckland Council, RWC 2011 and what Wellington is doing to Auckland.
Vote:February 19th, 2010 at 12:30 pm
Vibenna
Vote:I’d agree with you providing they deal to the financial industry as one of the reasons ordinary people go into the housing renting market is because they own the asset and can’t get stiffed by others they have no control over.
Personally like to see personal tax below 30%.
That those who cause the grief get away with it doesn’t help the perception that its not for small investors.
February 19th, 2010 at 12:31 pm
Paul Reynolds, surely? And I agree with bchapman, I haven’t met anyone up here who thinks the Supercity will be anything other than a complete failure. Fair play to Labour, though. Keep this up and they might even make a contest – no matter how weak – out of the next election.
Vote:February 19th, 2010 at 12:33 pm
Well I don’t think it is possible for the public to tune into what Labour are saying – see Labour tune into what the public are saying and repeat it. That’s all they have ever done, try hard to be popular because popularity gets you elected and gives you the chance to stuff the economy giving out lollies to win votes.
Vote:February 19th, 2010 at 12:35 pm
Bearhunter beat me to it. Who is Jack Reynolds?
Vote:February 19th, 2010 at 12:37 pm
Jack Reynolds is a filthy rich prick who did the most disgusting thing and got himself a job earning more than a beneficiary. Capitalist pig dog exploting us for his own gain…. how dare he work.
Vote:February 19th, 2010 at 12:53 pm
bchapman – yes, there’s something in what you say about the Auckland situation, which makes it all the more likely Goff and Labour must be up in the polls. If not, something is really wrong with them
Vote:February 19th, 2010 at 12:55 pm
george
To make headway on the Auckland situation requires leadership – Labour can repeat the mood of the people but hasn’t had any leadership since the teflon dictator departed.
Vote:February 19th, 2010 at 1:06 pm
No. If the debate focuses on that, New Zealand will have problems.
I couldn’t gave a fark about whether the government’s spin doctors can’t extricate themselves from awkward words, but I do care about my children’s future in this country.
Vote:February 19th, 2010 at 1:20 pm
I can see that the only answer to fair tax reform is to work out how much less tax the richest (or biggest tax paying) person should pay, and then give everyone the same amount in the pocket.
Vote:February 19th, 2010 at 1:26 pm
It’s interesting how John Key can publicly state that “no New Zealander will be worse off” under such tax changes, if that is the actual case why are we even bothering? wouldn’t the preferred option be to leave things as they are?
He’s only taking from one hand to give to the other: fooling people into thinking their actually better off.
I will not be fooled.
Vote:February 19th, 2010 at 1:33 pm
Where has he said that? It is impossible to achieve, even by doing nothing, as incomes creep into higher tax brackets.
Vote:February 19th, 2010 at 1:45 pm
Fale Andrew Lesa – “He’s only taking from one hand to give to the other: fooling people into thinking their actually better off.”
Yep, reminds me of another crowd who were pretty good at appearing to do something when in actual fact they hadn’t. Took 9 years to get rid of that lot. If the Nats keep up with their current lack of meaningful policy only the ineptitude of Labour and Goff will allow them to get past one term. A sad indictment of a Party that promised much.
Pete George – Key could make great inroads to tax reform by doing the basics, reducing out outgoings by ripping the public service to shreds. That will give him quite a few dollars to play with. This playing around the edges is doing nobody any favours, except the said bureaucrats working on this nonsense.
Vote:February 19th, 2010 at 1:51 pm
There is a Roy Morgan poll out soon. Maybe DPF has had a peek and the results are good for Labour?
[DPF: As far as I know no one knows the RM results until they publish them. I certainly don't]
Vote:February 19th, 2010 at 1:55 pm
Don’t know if its the right strategy but Labour certainly have their Super City talking points well organised. That last letter I got from Phil Goff had mock survey/push poll asking about Auckland City asset privatization (such as water), Public Transport investment and ‘Jobs for the boys’ old boy network concerns. I don’t see any of these issues as being that important to me (economic development or the lack of it should be the major issue), but obviously their focus groups are feeding these issues to them. Remember also the Mt albert by-election these were the major issues Shearer campaigned on
Vote:February 19th, 2010 at 2:24 pm
I cant see the rise in GST not do anything but shaft me.
Vote:Im pretty good at avoiding paying rent or at least much rent.
So unless they drop my paye tax by no less than 2 percent i lose.
I dont use the unemplyment benifit, but if this goes through i may find my self seeking compensation for my lack of income.
February 19th, 2010 at 2:50 pm
Unless government waste is cut (dont call it expenditure) the economy will never grow to its full potential and the poor will keep on getting poorer and the rich will keep on getting richer and the middle classes will get poorer.
Thats the way of the world.
the government should be no more than 20% of GDP maximum.
It doesnt need to be any bigger.
Until we have a government that concentrates on doing the basics and doing them well we wont go anywhere except down the international tables.
The Nats have been a huge disappointment They have failed to take action They have appealed to the lowest common denominator.
Popular doesnt fix stuffed economies Its needs a benevolent dictatorship to take a lead and take the people with them.
For those of us who are financially independent and can and have arranged their affairs to only pay the level of tax they believe they should pay it is extremely frustrating to watch pollies and civil servants thrashing around getting no where fast.
But heh unless the citizens rise up and start demanding the correct action then they will just have to live with the consequences.
Vote:February 19th, 2010 at 5:30 pm
mickysavage – it looks like the Roy Morgan poll is a rogue. It shows no significant change – see http://www.roymorgan.com/news/polls/2010/4470 That can’t be right given the good run Goff has been having and all the Government’s fuck ups. The TV polls over the weekend must surely show a big drop in the gap between National and Labour.
Vote:February 19th, 2010 at 7:03 pm
Supercity? Brown for Mayor? dosh for Eden Park? Party Central? People in this part of Auckland just want other people’s hands out of their wallets!
Anf Goff – improved – give me strength! Same Wally different tune.
Vote:February 19th, 2010 at 8:05 pm
george
A not so modest change, the poll reports an increase for Labour (1%) and the Greens (2%). The gap (National/Labour Green) is now 11 %. At this rate (polls every fortnight) the gap ought to be closed by May this year.
Still feeling confident?
[DPF: What a pity then Labour have worked so hard to alienate the Maori Party]
Vote:February 19th, 2010 at 8:55 pm
[DPF: What a pity then Labour have worked so hard to alienate the Maori Party]
Who needs the Maori Party?
Vote:February 19th, 2010 at 9:03 pm
Wait until bollard increases our interest rates to cripple economic growth least it causes inflation.
Vote:February 19th, 2010 at 9:04 pm
["mickeysavage" (sic): Who needs the Maori Party?]
err, Labour have for the past 50 years Einstein. But I guess you’ve got the Greens now though, eh bub?.
Vote:February 19th, 2010 at 9:11 pm
Drop to 33% or 30%? Why keep them in the 30% decile at all? National, at least consider a drop to 29%. It’s a minor difference fiscally but a major one psychologically. That would announce “true game-changer” without affecting tax revenues much. That, and a new tax-free threshold for WORKERS.
Vote:February 19th, 2010 at 9:52 pm
National are going to need close to 50% to form government next time. Thanks to Rodney’s actions ACT is now a dead duck (they will be lucky to have 1 or 2 seats) so the only viable partner for National will be the Maori Party. Imagine that, lots of North island forestry deals, flags being flown everywhere, Whanau Ora for everyone, Treaty Settlements galore etc etc.
Could be an interesting election campaign Labour/Greens or National/MP. Either way, he way conservative voters are going to be very conflicted.
Vote:February 19th, 2010 at 10:26 pm
That is how politics work’s you marginalise the voters who have no option.
Vote:February 19th, 2010 at 11:22 pm
Watching parliament this week, Labour sure received a fair amount of luck due to “weakest link” Tolley. For nearly 10 minutes I watched with my mouth wide open as Tolley ducked and dived to avoid answering a question about inter-school moderation of the National Standards. I really couldn’t believe what I was watching, but it was obvious – the Minister of Education does not know what inter-school moderation is. As if we didn’t already know – she is incompotent.
Vote:Is there still anyone in the Tolley fan club on this site?
February 20th, 2010 at 6:40 am
The poll results should punish Key’s incompetence. Spending more time being photographed with gays and lesbians, instead of telling English to have the courage to undertake a drastic tax overhaul.
I’m sick of Key’s lazy attitude to serious problems while Rome burns.
Vote:February 20th, 2010 at 9:51 am
Manolo, I hope you are right. I just found out National just raised the tax on savings from 19.5 to 21 percent. Grey power isn’t too happy about this. Talk about disappointment! We have ACC, The ETS, GST, , and now this. John likes to keep his election promises like not reducing the amount of civil servants but goes against his other election promise, not raising taxes. I think when the reality hits, the ets bill goes into effect, paying out acc, and just filling up at the pump and going to the grocery store, voters will realize that John Key just ripped us off. I would love to see his poll ratings drop by 15 percent at least.
Vote: