Editorials 14 May 2010

May 14th, 2010 at 11:34 am by David Farrar

The NZ Herald talks Super City:

Who should lead Auckland? By a surprising margin, residents seem to favour the lesser-known of the two declared candidates for the Super City mayoralty. …

It could be that today’s survey reflects a view from across six of the seven territorial-council areas that a vote for Mr Banks represents a central Auckland takeover of their cities. An anyone-but-Auckland-City mentality would make a tough campaign for the Banks team.

He may be copping the backlash over the Government’s poor handling of the Super City reform, which is unfair as he has voiced concerns over several aspects of that process.

And The Press on rugby:

The inclusion of Argentina in what will be, from 2012, a southern hemisphere four-nations tournament is obviously great news for supporters of the Pumas.

For many years the South American nation has been starved of regular top-flight tests due to the club commitments of its leading players in Europe, notably in France, but that will now change, with a rule change agreed by the International Rugby Board (IRB) this week. Finally, it seems, Argentina will be playing in a high-profile annual test rugby competition.

And the Dom Post on :

As Bill English prepares to deliver his second Budget on Thursday a spectre hovers at his shoulder. The spectre is Greece.

The land of retsina, olives and sun-drenched beaches is about to become the land of wage cuts, job losses and higher prices, thanks to the profligacy of successive Greek governments.

Greece’s predicament is a cautionary tale for governments and peoples everywhere. Keep spending more than you earn and one day the debt collector will come calling.

A lesson lost on Labour it seems as they keep calling for the Government to increase spending and borrowing.

New Zealand, fortunately, is far from Greece’s situation. Public debt is at present about 13 per cent of the size of the economy – a fraction of the 120 per cent Greece is tipped to reach this year – but Government spending is forecast to exceed revenue for the next six years and debt levels are rising.

What some may forget though is that fiscal settings inherited from Labour had spending always remaining greater than revenue, and debt indeed increasing over the long-term to Greece type levels. Without the changes made by National in the 2009 budget, net crown debt was forecast to exceed 60% of GDP within around a decade.

And Labour opposed pretty much every one of those changes that reduced the debt track.

So far John Key’s Government has struck a sensible balance. It has borrowed enough to keep the economy ticking over and to insulate New Zealanders from the worst effects of the global financial crisis but reduced the rate at which debt was forecast to grow when it took office.

It should continue to take a long-term view of New Zealand’s interests. Mr English must continue to keep a tight rein on spending, not just in 2010 but next year – election year – as well.

Spending restraint needs to be maintained until, at the earliest, the OBERAC is back in surplus, and large enough to cover NZSF contributions.

The ODT looks at classroom attacks:

Thus it is in the case of the 13-year-old year 9 Te Puke High School boy who attacked his teacher with a 10cm kitchen knife, stabbing him in the neck and shoulders several times.

A centimetre or two either way, it must be supposed, and the injuries could have been fatal.

The attack has been met with anger at the perpetrator, sympathy for the teacher, incredulity that it could have happened at all, and revelations of just how common classroom assaults are becoming.

In 2008, 238 pupils were stood down for assaulting teachers; 442 teachers needed treatment after assaults at school in 2008 and 2009 at a cost of $413,000. …

The question is, why? Why did the boy have a knife at school? Whatever possessed him to make this apparently unprovoked attack? Was he, is he, prone to violent outbursts or physical aggression? If he had an issue or a grievance, why did he not first attempt to resolve them otherwise? Perhaps he did, and perhaps more of the background to this terrible episode will yet emerge, but it will not diminish either the viciousness of the assault, nor the level of accountability to which the assailant must be held – regardless of his age.

All good questions.

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32 Responses to “Editorials 14 May 2010”

  1. Jeff83 (747 comments) says:

    Your comment on labour whilst currently true is historical bullshit. Yes Labour increased spending but they also effectively increased taxation. I know you and nearly everyone here does not agree with that but at least whilst in power they had strong surpluses which were used to reduce government debt, hence when we went into the recession the government books started in a strong position.

    The thing is Labour followed what they believe in, Keyian economics, so in the boom times they took more than they needed but in the bust they encourage increased spending, National encouraged the opposite of tax cuts in the past and belt ‘tightening’ in the recession, both are options and both have merits. However this is NOT the same as Greece where it borrowed in the boom and in the bust. The had socalism with an attitude that tax evasion was a good thing. You can have one or the other, you cant have public spending and noone paying tax.

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  2. tvb (4,558 comments) says:

    The Labour Party has opposed every spending cut and every attempt to improve the solvency of ACC. Their vision is to spend without asking for value for money and to tax tax tax and tax again to pay for it all.

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  3. Jeff83 (747 comments) says:

    And for the record no I do not support Labour currently, they are desperate and their policies just scream it, not much different than when National was struggling to make a dent not all that too long ago.

    Do I think Labour actually believe in policies like no GST on food, no, well I certainly hope not. But they are deperate for support, much like Don was back in the day.

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  4. Jeff83 (747 comments) says:

    Tvb a subjective comment, which even if true is not the same as Greece, which DPF is trying to infer it is. I get sick of people trying to link NZ to places like Greece, when clearly it is so much different and the closest we came to bankruptcy was under a fucking national government headed by the worst thing to ever happen to NZ, Muldoon. The only thing positive that prick achieved was forcing us to become a market economy, ironically brought in by labour.

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  5. Positan (397 comments) says:

    “What some may forget though is that fiscal settings inherited from Labour had spending always remaining greater than revenue, and debt indeed increasing over the long-term to Greece type levels.”

    Every out-going Labour government has left indebtedness and a huge financial mess for the incoming National administration – Clarks’ being the largest of record. The mess left in 1990 compelled Ruth Richardson’s “mother of all budgets” – to which, incredibly, Clark and her incompetent lackeys made frequent, sneering reference – seemingly unaware of what necessitated it, or even that the fact of it reflected incredibly badly on Labour.

    To date, Goff has demonstrated identical failings in his lack of understanding of financial matters with his inane calls to “axe the tax” and “drop GST on fruit and vegetables.”

    Will the electorate never come to the full realisation that the only thing that matters to every single Labour aspirant is to get themself elected. It’s not remotely important to any of them that they’re in no way up to the job.

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  6. Jeff83 (747 comments) says:

    I guess Positan you are cleverly choosing to ignore who created the real mess of the mother of all budgets, being a national government, who embarked on many ‘investments’ it couldnt afford and then tried to completely f*** it all over by defending the currency and loosing billions. The subsequent labour government did allot to change this around, maybe didnt go far enough but did better than National did, who achieved the opposite.

    And as for the books when they left last time they were actually pretty good, it was the forecasts going forward which had changed from prior due to a global recession and therefore reduced tax take and growth expected. Quite allot different from Greece. ACC is the exemption and that was caused primarily by a loss in the fair value of assets caused by the financial meltdown and a change requiring the scheme to cover future costs as well as current and then finally to a much lesser extent extending the scheme beyond what it could cover.

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  7. Lutzie (56 comments) says:

    Although one can never write him off, another few polls with this sort of gap and John Banks will be a done deal. His attempt at rebranding to a touchy feely version of his previous brittle battler positioning seems to be falling on deaf ears.
    Michelle Boag will have to pull something enormous out of her hat.

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  8. Lutzie (56 comments) says:

    Two posts above:
    “I know you and nearly everyone here does not agree with that but at least whilst in power they had strong surpluses which were used to reduce government debt, hence when we went into the recession the government books started in a strong position.”

    “Every out-going Labour government has left indebtedness and a huge financial mess for the incoming National administration – Clarks’ being the largest of record.”

    One could also argue that every incoming National government has undone some pretty good work; dating back to Muldoon’s undoing of Kirk’s contributory super scheme. English has followed that tradition by reducing contributions to the ‘Cullen’ fund just as markets were picking up strongly. So NZ missed out on a spectacular windfall.
    Certainly our relatively smooth ride through the recession so far point most of all to Cullen’s (unpopularly) conservative fiscal management.

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  9. JiveKitty (778 comments) says:

    Is Public Debt to GDP a particularly useful measure?

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  10. krazykiwi (8,040 comments) says:

    Michelle Boag will have to pull something enormous out of her hat.

    Her head?

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  11. Kris K (3,570 comments) says:

    The ODT looks at classroom attacks:

    Thus it is in the case of the 13-year-old year 9 Te Puke High School boy who attacked his teacher with a 10cm kitchen knife, stabbing him in the neck and shoulders several times.

    A centimetre or two either way, it must be supposed, and the injuries could have been fatal.

    The attack has been met with anger at the perpetrator, sympathy for the teacher, incredulity that it could have happened at all, and revelations of just how common classroom assaults are becoming.

    And then we have yet another example, the second this week, regarding this same issue:

    A 15-year-old girl has been arrested after allegedly threatening other students with a knife at Hamilton Girls’ High School.

    Police say that following an earlier disagreement, a pupil brought knives to school and menaced other students.

    Those students alerted staff and a female teacher was able to persuade the girl to surrender a knife.

    Police were called to the school just before lunchtime on Thursday and found it in lockdown mode, the standard procedure for schools dealing with serious incidents which allows them to account for all pupils.

    Although no one was injured, police are treating the incident very seriously and are interviewing the girl at the Hamilton police station.

    […]

    What’s happening to our society when kids not only take knives to school, but they are prepared to use them as well?
    And WHY is this happening? – any ideas all you secularists out there?

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  12. Ryan Sproull (7,360 comments) says:

    And WHY is this happening? – any ideas all you secularists out there?

    Lots of reasons, probably. I’d suggest the two-income family as one. It’s no longer possible for one parent to work and the other to stay home and do the job of raising the kids, for most families at least.

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  13. MikeNZ (3,233 comments) says:

    Hey a 13yr old from Wtn high was beaten up 2 days ago.
    1 did it while a whole gaggle watched, she was followed away from school.
    the 1 is stood down but the others knew what was going down and get off scott free.

    I hope the parents lay charges of assault alongside the school’s efforts (if any).
    at the worst the kid will get diversion so using up her one chance at it and at best she’ll get convicted for assault and start her history with the youth wing of the justice dept.
    pity they can’t prosecute each kid who was there with a cell phone and didn’t phone the police too.

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  14. Sonny Blount (1,809 comments) says:

    English has followed that tradition by reducing contributions to the ‘Cullen’ fund just as markets were picking up strongly. So NZ missed out on a spectacular windfall.

    Thank god he didn't. The situation in Greece and the potential repercusions of failed socialism in Europe have shown Bill's decision to be a wise one.

    Wall Street dropped 1000 points in an hour last week, this is not the time to be borrowing to speculate.

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  15. Positan (397 comments) says:

    re Jeff83 – “I guess Positan you are cleverly choosing to ignore who created the real mess of the mother of all budgets …”

    Even if what you say was true (there’s not the space to argue it here), surely some understanding for the necessity of that budget should have been evidenced if Labour people had really understood the actual situation. I stand by my original comment – Labour demonstrably neither understood nor appreciated what had to be done.

    However, I do agree that Muldoon’s disposal of Kirk’s contributory super-scheme was a big mistake – as was his alternative, with which we are encumbered today.

    re Lutzie – “One could also argue that every incoming National government has undone some pretty good work …”

    The unmistakable thrust of a Labour-oriented argument begins with defensive comment and attempt to posit something comparable but essentially irrelevant to the thrust of the current subject, as rationale. Surely English’s reduction of contributions to the Cullen Fund would have been motivated at the time of his decision by the total absence of available funds – other than by way of increased borrowing. (There was also the additional impact of Cullen’s $2billion NZ Rail-debt surprise, which might well have had some bearing.)

    It’s always clever to say “I told you so,” but the call to cease contributions prior to the event of the “windfall” would have been the call of most responsible financially-aware administrators.

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  16. Sonny Blount (1,809 comments) says:

    Certainly our relatively smooth ride through the recession so far point most of all to Cullen’s (unpopularly) conservative fiscal management.

    It is because of Key and English not doing what the socialists in the US and UK and borrowing for a massive stagnation package.

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  17. max (30 comments) says:

    FFS do you guys not have memories. The exact same fucking people calling for debt reduction were the exact same asking for massive tax cuts in 2005 which would have increased out debt further. Remember the bleating over the size of the surplus???

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  18. Jeremy Harris (319 comments) says:

    “What some may forget though is that fiscal settings inherited from Labour had spending always remaining greater than revenue, ”

    Tax receipts crashed, no way of knowing what Labour really had done because in Opposition it is easy to oppose every spending cut when you don’t have the responsibility of balancing (or not) the books…

    @Jeff83, I believe in Keynesian economics and that it is a generally good thing but even Keynes stated that borrowing in the recessionary times should not exceed 4% of GDP, ours is about 8%, (UK 12%..!) I’d argue National is doing exactly the wrong thing by cutting taxes and if it it is to cut taxes cutting the top personal taxes is exactly the wrong thing to do… The best thing to do would be reduce company taxes to 25% and introduce a tax free threshold, this could be achieved by ditching Working For Families (up to $4 billion a year now and would be compensated by the tax free threshold) and getting rid of superflious departments, commissions etc of which there is another $1 billion odd worth of…

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  19. Bevan (3,232 comments) says:

    And WHY is this happening? – any ideas all you secularists out there?

    What has this got to do with religion, or lack thereof?

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  20. Bevan (3,232 comments) says:

    FFS do you guys not have memories. The exact same fucking people calling for debt reduction were the exact same asking for massive tax cuts in 2005 which would have increased out debt further.

    No, we were also calling for a reduction to spending as well. Those of us who are pro tax cuts, are typically also against Kiwisaver, WFF and Interest Free Student Loans. Basically we want the government to take less of our money, and what they do take – we expect them to spend it wisely, and not use it to bribe voters at election time.

    Remember the bleating over the size of the surplus???

    Yes, and I also remember Cullen informing us that the surpluses were structural.. Was he lying, or just wrong? But I admit, that I missed the time he informed us that the IRD was $2 Billion in the red.

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  21. AlphaKiwi (683 comments) says:

    @Max Hey, Max. I also remembered everyone complaining about and pressuring the Labour Government during to shrink that surplus by introducing tax cuts and upping Government spending. If we Kiwis had the mentality that having some savings is actually a good thing, then we could have used some or all of the surplus, rather than borrow to try to get through this recession. Kiwis, be careful what you ask for!

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  22. BlueDevil (92 comments) says:

    You mean ACC was $2b in the red?

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  23. Bevan (3,232 comments) says:

    You mean ACC was $2b in the red?

    Ummm yes…. embarassed …… fucken acronyms ….

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  24. Bob R (1,421 comments) says:

    ***The question is, why? ***

    Possibly abusive upbringing, low intelligence, high testosterone, low activity MAO-A variants, maybe associated with gang culture.

    A good candidate for paid vasectomy.

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  25. side show bob (3,410 comments) says:

    Hi Max you seem confused, there is no chance of dept reduction if the tax rate is high. I guess this is the argument of the right. That is that the more you can earn and retain the more you will invest. The cliam on the left is the government know how to spend “YOUR” money is a crock of shit.History is what you should look at.

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  26. philu (12,989 comments) says:

    “…That is that the more you can earn and retain the more you will invest…”

    is this why you..a rich dairy farmer…have your income ‘arranged’ into a trust…so you become ‘eligible for more than a grand a month in working-for-(some)-families-welfare…?

    ..eh..?

    what was that quote from you..?

    “me and my family don’t need working for families…i just use it to pay my tax..”

    wasn’t that what you said..?

    is that how you put your ‘the more you can earn and retain the more you will invest’ premise into practice..?

    by ‘arranging’..to ‘qualify’…?

    phil(whoar.co.nz)

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  27. philu (12,989 comments) says:

    btw..this thread is an excellent rebuttal of the usual bullshit revisionist history posted/believed by most around these parts…

    well done to all..

    phil(whoar.co.nz)

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  28. bchapman (649 comments) says:

    Hmmm, how short some peoples memories are. I seem to recall the scrooge tag being thrown at Cullen when refused to counternance tax cuts. I think his words were- “lets save for a rainy day”.

    Of course now that we have a rainy day and Bill and John want to give away money in tax cuts, provide $1bill per year in government sponsored carbon handouts and build $2.4 bill roads so they can get out of town quicker.

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  29. willtruth (243 comments) says:

    But are we really right to worry so much about getting public debt down? I agree debt is bad from an instinctive point of view, but should it always be our top priority? Haven’t we choked off GDP growth in the past by focussing too much on debt?
    Greece is still much richer than us despite their government’s supposed profligacy (GDP PPP for Greece = 32K, compared to 27K for NZ). Maybe that is about to change? But compare Japan. It has debt at 192% of GDP! Much higher than NZ 29%, and even Greece, at 120%. But despite its public debtm Japan is still much richer than us (GDP also at 32K) and there don’t seem to be any concerns about Japan going under. Seems to me focussing just on debt is a bit simplistic.

    Public debt isn’t our problem. Our problem is slow growth in both GDP and productivity.

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  30. Dazzaman (1,082 comments) says:

    Travel from/to Argentina will be gruelling for all involved. My big worry about all of this is whether the Euro clubs will be willing to part with & risk their 4×4 front rowers and other players. There could be some large scores before the Pumas get to grips with the travel & probable weakened teams due to Euro club reluctance to part with their players.

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  31. AlphaKiwi (683 comments) says:

    @side show bob
    I think you’ll find that most Kiwis don’t know how to spend their money wisely, or Westerners in general for that matter. However, I agree the Government probably isn’t and better. Before I left New Zealand, I learnt how to pretty much spend all my cheque from seeing my father do the same thing. Bad money habits are passed down through the generations. I’ve been living in China for the past seven years and have finally learnt the importance of saving and spending money wisely through observing ordinary Chinese folk. The Chinese are great savers, even with the little they have. There is no social welfare here to speak of, so it’s a necessity. I will move back to New Zealand in July with good spending and saving habits.

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  32. Sandy (44 comments) says:

    Flash a knife and you can be spoken about too. How long will it take the wowsers to connect the dots of school attacks back to alcohol… but surely all roads must lead to rum-pops? And if not – why not? Spin Drs from the temperance closet arsenal you had better hurry and make it so. No opportunity can be missed.

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