Key’s tests

January 2nd, 2011 at 11:45 am by David Farrar

in the SST reports:

On the night when pushed his way through a horde of backslapping supporters celebrating his election victory, no one had an inkling that a series of disasters lay in wait.

Ahead lurked a financial crisis, a $1.7 billion corporate bailout, a $4 billion natural disaster, the first combat casualty in a decade, and, finally, Pike River, a tragedy that dwarfed even Cave Creek in terms of loss of life.

As the good ship New Zealand steams from one crisis to the next, Key has become noticeably grey at the temples, and his staff have become increasingly protective of his private family time – a few hours on a Sunday, and the occasional overseas holiday.

Staggeringly, the optimism that charmed voters in 2008 and swept Key to power seems to have survived the battering of two years in office despite little respite from a grim economy and a string of bad news.

Maybe that is why Key and his government are more popular now than on election night. Leaders are judged on how they handle a crisis and Key’s instincts have remained unerringly in touch with what the man or woman on the street expect of him in bad times.

A crisis only looks easy to respond to with hindsight. They often trip leaders up. The Bolger Govt’s response to Cave Creek was poor, and Bush 43 with Hurricane Katrina is an example of how a lack of apparent concern can be damaging. And Obama’s response to the financial crisis led to the birth of the tea party, as a backlash against his fiscal stimulus.

The most important thing is voters knowing that you can step up, says Key.

“People want to know if the government’s in touch with the issues that are real, or are they just people who fight in the debating chamber on inane subjects and call each other names?”

Exactly.

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29 Responses to “Key’s tests”

  1. Jimbob (641 comments) says:

    Clearly the best leader NZ has had for a long, long time.

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  2. bchapman (649 comments) says:

    In Australia natural disaster are almost routine. Massive fires, floods, cyclones, droughts. At present In Queensland 20% of Rockhampton is under water and its going to cost $billions to replace the infrastructure. Saw Gillard on TV up there- media made no deal of it. Maybe one day our media will grow up.

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  3. reid (16,111 comments) says:

    “People want to know if the government’s in touch with the issues that are real, or are they just people who fight in the debating chamber on inane subjects and call each other names?”

    How about the real issues that you are in touch with that the people aren’t: i.e. the need to drastically slash govt expenditure in all directions? It’s true he’s a good crisis manager, but that’s only a part of the job. The thing that’s acutely and sorely missed at the mo is his political strategy: i.e. what is it? Just cause the reef-fish don’t recognise the lack thereof, don’t imagine the rest of us haven’t.

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  4. Gooner (995 comments) says:

    @ jimbob

    Clearly the best leader NZ has had for a long, long time.

    That depends on where he is leading us.

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  5. nickb (3,675 comments) says:

    People want to know if the government’s in touch with the issues that are real

    Like borrowing $1 billion a month?
    Or failing to materially lower taxes>
    Or raising GST?
    Or failing to materially cut government spending?
    Or failing to close wasteful government departments?
    Or the imposition of extra taxes and price hikes through the ETS, in clear contrast to his and Nick Smith’s pre-election statements?

    I would rate Key’s response to the economic crisis as a big, fat, F.

    Sure he is a friendly bloke, and likeable enough, but what good is that when your country is sliding to economic ruin?

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  6. Swiftman the infidel (329 comments) says:

    Mr Smile and Wave is a spineless traitor.

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  7. Swiftman the infidel (329 comments) says:

    Global warming taxes!

    The lying hypocrite is holidaying in Hawaii.

    Parliamentary traitors. The lot of them.

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  8. Chris Diack (723 comments) says:

    “During the financial crisis he stared down National’s allies on the right who demanded sweeping change and savage cuts, and promised to keep a safety net in place for those affected by the downturn.”

    Good of Tracy Watkins to conclude that the GFC has entirely passed and we are in the good times. She also terribly over eggs this valiant resistance to the politics of austerity.

    History will forget Key’s good handling on the other disasters in this story. They matter in the short term but not in the long run. His big test is an economic one – and the jury is still out on that.

    Whether New Zealand as made the adjustments necessary in a post GFC world is still an open question. No conclusion can be drawn yet. All we can say is that each week we are 300million deeper in debt.

    Key’s big problem is that increasingly western nation by western nation is adopting policies of austerity which increasingly makes National’s response here look unrealistic. At some point it will be noticed.

    The short term “good” judgement against adopting any of the policies of austerity might look a bit gutless in the longer run.

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  9. MT_Tinman (3,055 comments) says:

    I realise that this will be seen as sacrilege to Bed-wetter and his co-communist mates (as well as the odd honest rightwinger) but while noting I would have preferred a stronger right wing move I think Key and his government have done fairly well.

    I suspect that had the massive spending cuts so badly needed been implemented immediately Key’s government would have been a one term one and this year would have seen the resumption of the christ-awful quasi-communist lot so recently shown the door.

    Unchanged and unrepentant!

    So for mine Watkins is correct, Key has done well both as the countries leader and as the go-to man in the many crises that have befallen NZ recently.

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  10. reid (16,111 comments) says:

    For me, Key overpromised and this has bedevilled him.

    Ho overpromised by promising not to do certain things like sell specified SOEs like Kiwibank which he’ll do this next term. But he could have done it this term. He was too cautious, not understanding the depth of Liarbore’s unpopularity.

    This to me is a worry, for it means he has no reliable gut instinct. Liarbore’s unpopularity was palpable before the election, you could smell it and anyone in his position who didn’t know has got lousy advisers. He should have been able to detect it himself, and the fact he obviously can’t is why I said he lacks gut instinct.

    Secondly he overpromised by failing to fully realise the extent of the GFC, another completely obvious event and if he was surprised when the govt’s state was revealed then FFS, what is he on. But then on top of that, when he did finally realise, he failed to use that as an excuse to wind back some of his election promises like the tax cut which was clearly unaffordable and would never have any effect because newsflash: stimulartory cuts don’t work when everyone is focused on debt paydown. Duh. What better reason than the GFC if you’re going to do that? But no, he didn’t. This was his 3rd strike, for me.

    What he needs to do is cut out interest-free student loans and WFF for people over say 80k combined. He has to do at least that, but again, he won’t. Mr fucking popular.

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  11. Manolo (13,517 comments) says:

    Clearly the best leader NZ has had for a long, long time.
    The New Year party must have been wild and ferocious. Still hangover, uh?

    Despite of the adoring popularity by the masses (remember how the populace loved Auntie Helen?) Key has underpeformed. He has not delivered what he promised before the election.

    Thus far Labour-lite has failed.

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  12. Diziet Sma (109 comments) says:

    I think Mr Key is doing a great job. Yes, there’s a few things I disagree with – as you would with any leader. I like that he’s been successful outside of politics to begin with. After watching over time I have to admit I’ve had respect for every appearance he’s made, no matter what some looney is yelling from the sidelines. I hope he continues to do well & what is good.

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  13. wf (400 comments) says:

    Gee, this could be the TM opinion board today, keep it up lads!

    If the ABs do the decent thing and win the cup, we’ll have an election and then slash and burn will follow but we’ll only moan about it.
    If they don’t win, the slash and burn will follow, and the govt will be the most unpopular we’ve ever had: riots and protests will be the order of the day.

    Bloody ABs!

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  14. Inventory2 (10,181 comments) says:

    MT_Tinman sums it up well. Most of us would like more slash and burn, but the global financial crisis has put the kibbosh on that. I will be far less forgiving of Key however if he doesn’t push the boat out in the second term.

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  15. Offshore_Kiwi (557 comments) says:

    INV, you & I agree on a lot, but I’m calling bullshit on you this time. The GFC did not put the kibbosh on slash & burn. If anything, the planets were aligned for a real leader to step up and wind back some of the pork-barrel and damaging policies of the lesbian totalitarian. Up against the GFC, a massive gap in ACC and other sundry holes in the boat Key has continued to implement policies that not only do not repair the damage but which cause additional destruction. He did not have to proceed with the Emissions Trading Scam. He did not have to cave like a little girl over mining the Conservation Estate. He did not have to bribe the racist separatists with beads, blankets and state forests. He could easily have put interest back onto Student Loans. And that’s without winding back some of the massive bureaucracy that is currently acting like a sea-anchor on the economy. As an absolute minimum, he should have shown that weak and quisling farmer from Dipton the door. He has failed abysmally. But I guess at least he’s a little bit less terrible than the alternative.

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  16. nickb (3,675 comments) says:

    Wow, well said ^^^^

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  17. John Ansell (874 comments) says:

    I see, so we expect a PM who refused to do the right thing when the time was right (when the GFC would have justified it) to somehow act boldly when the time is less right (after his second, likely much closer, election).

    If Peters can get 4.6% in 2008 in the depths of a corruption scandal, then he’s a sure bet to be back. And even surer to go with Labour.

    That means the Nats will not just have to win, but win well.

    (All the moreso if Bob Jones is right and Maori desert the Maori Party and return to Labour.)

    In Key’s populist mind, as in Muldoon’s before him, it is always the wrong time to do the right thing.

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  18. Offshore_Kiwi (557 comments) says:

    No John, I don’t “expect” Key to do anything except keep on smilin’ and wavin’. He will go down in history as New Zealand’s most disappointing Prime Minister. Who managed to squander a good crisis in a fit of appeasing everyone when he didn’t need to (let’s face it, there *is* no opposition in New Zealand at the moment and all he’s really doing is pissing off his core constituency).

    The time is not now “less right”. There is a real prospect of a double-dip (something English should know a lot about, although not in the context of a recession), and bold moves will be required to avoid one. If anything, the time is now “more right” than in the deep crisis of 2008/9.

    I don’t think we’ll see Winston First back, but I do think Maori will desert the MP and return to Liarbore. I just don’t think Winston can do it again (although I confess that may well be wishful thinking on my part).

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  19. Pete George (23,345 comments) says:

    Who managed to squander a good crisis in a fit of appeasing everyone

    Not everyone sees a financial crisis as a good excuse to ram through radical reforms only wanted by a handful on the fringe, in fact most people seem to think Key/National have acted reasonably and responsibly, and mostly quite honestly and effectively.

    And most people see way beyond the persistent attempts to trivialise Key with the “smile and wave” label, funnily enough it’s the more cranky to the right and to the left who have been doing this.

    There is a vocal minority in politics that perpetually hissy fit and throw shit when their extremes are not elected or enacted immediately, and they are the ones doomed to being perpetually shitty. They get particularly frustrated when a popular PM does a reasonable job and earns reasonable praise.

    The same sort bitching can be seen from both sides of the political divide, they seem to confuse the aim of divide and conquer with being derisive plonkers.

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  20. berend (1,676 comments) says:

    Peter George: in fact most people seem to think Key/National have acted reasonably and responsibly, and mostly quite honestly and effectively.

    Ah, that’s what you call borrowing $300 million A WEEK, and pushing the problem to our children, enslaving them in debt?

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  21. Pete George (23,345 comments) says:

    Depends if it is temporary to ride us over the recession or not. If they weren’t borrowing there would be a more severe retraction in the property market and in retail sales and higher unemployment, which can become a vicious circle. One positive at the moment is a move for people to reduce current personal debt, this was badly needed.

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  22. Manolo (13,517 comments) says:

    I will be far less forgiving of Key however if he doesn’t push the boat out in the second term.
    Time will tell, IV2. Do you want to bet some single malt that Key lacks the courage to implement National’s manifesto and prefers a watered down version of “nothing for all”?

    I’ll be more than happy to be proven wrong. Cheers.

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  23. Offshore_Kiwi (557 comments) says:

    Petie, I’m not perpetually grumpy. In fact I’m a pretty happy sort of guy. But then I don’t have to live day-to-day with the effects of a decade of Clarkula like my friends & family, so I have a reason for being happy.

    Even if one accepts the premise that Key is taking it slow & gentle, trying to ease NZ out of the financial mire, there are a lot of actions that have contributed to NZ’s financial woes and which he could easily have chosen not to take. I mentioned the more obvious ones above.

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  24. tom hunter (4,568 comments) says:

    Well before the last election I thought we would be looking at a Holyoake Mk V government, and that’s what we’ve got, especially in terms of the latter stages of those governments.

    Which is to say that there is once again the sense that things are slowly spiraling out of control: that there are no real solutions or that the solutions are not acceptable. That problems can be dealt with further studies, analysis, commissions and so forth, things actually designed to give the impression of action while not really doing anything to change. Borrowing against our good credit rating could prop it all up for a long, long time.

    It took more than another decade for the comfortable status quo to finally crack completely and when it happened that suddenly, when the problems that had festered for so long were finally too obvious to ignore, the result was “shock therapy”. It would be good if we could think ahead this time but I guess that’s just not the NZ culture. It might go faster this time, but even if less than a decade it will probably be after John Key leaves office: it might even be the reason, a crisis giving rise to a new Labour-led government in 2014. But this time I doubt they’ll go as in 1984 – too many memories embedded in the party now.

    So, I’m planning for 50% income tax rates on $120,000 and above, together with estate taxes, myriad other new taxes and so forth.

    Perhaps we’d be better off if we simply made the best of a situation where the likes of Offshore Kiwi make their piles overseas and return to have kids and effectively “retire” on incomes of less than $100,000, using the balance of their imported wealth to support the lifestyles. Perhaps I’m pushing the anecdotal too far, but that’s effectively what I did – and when I sit in places like Wanaka and observe all the flash cars, boats and house but don’t see the associated businesses that could be generating such wealth (perhaps I missed them?) I can’t help wondering how many more people have done just that.

    Of course, if my observation is true the question will be when the left wakes up to this and starts going after those people, post-2014? Is that even a viable strategy? I doubt it, but as the welfare state grows more desperate for money what else will remain to go after?

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  25. Offshore_Kiwi (557 comments) says:

    Tom it’s all the Left will have; attack the “rich pricks” is their go-to-plan. I just wonder how many rich pricks will be left to bleed dry when another half-million of me have left NZ come 2020?

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  26. tom hunter (4,568 comments) says:

    Offshore

    I agree. Basically it’s the end game of From each according to their abilities….. Jordan Carter gave a preview of this several years ago: they’ll try and shut-down every avenue for accumulating “too much” wealth, passing it on to your kids and so forth – thereby forcing you to stay on the high-earning treadmill and generating the tax revenues needed. That seemed to be the theory anyway.

    When I queried some of my Labour acquaintances about the Jordan Carter thesis I was met with one of two reactions:
    No, no, no. That’s ridiculous. We all know that would just drive people further into the woodwork.

    Shrug of shoulders. So what, they’re rich pricks and they’ll just make more money to compensate and still get that new Ferrari.

    I was also rather reminded of Obama’s now infamous little pronouncement: “I do think at a certain point you’ve made enough money”, mainly because the unintended result would be many people saying exactly that. Why bust you arse to earn $300-500K in NZ just so you give a large and increasing chunk to the government?

    As a matter of interest – and perhaps to put some light on my anecdotal observations above – just what are you going to do with regards to NZ? Most of my friends never came back and the ones who did fell into two categories: they’re struggling along because “NZ”s a great place to raise kids”, or they came back loaded up and not having to work because “NZ’s a great place to raise kids”!

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  27. Offshore_Kiwi (557 comments) says:

    Honestly, I’d love to come home. SWMBO and I left NZ in 2003 (we missed most of Clarkula’s decade of corruption) for an agreed period of 2 years. We’ve not yet found our way back, and in the industry I work the only way to move up (in NZ) is “dead man’s shoes” whereas in AUS I can pretty much now pick ‘n’ choose my assignments. Also the income I can earn in NZ is about half what I’m earning here. Our Miss 4 is all set for school here in Melbourne, so we may look at it again when she finishes Primary School. I’ll be pushing 50 by then and maybe looking to use assets rather than hours for income generation.

    You’re right, NZ is a great place to raise kids. It’s also where all of Miss 4′s cousins and grandparents live but at the moment I’d rather build up so she has better options than me and doesn’t have the financial struggle I’ve had. We’re close enough that SWMBO and Miss 4 get a couple of trips home each year, and the grannies come over a couple of times each as well.

    How long do you think it will be before Comrade Minto’s suggestion of a 100% tax rate on earnings over $200K starts getting mainstream air-play? Something has to be done about NZ’s financial situation and we can’t cut back on welfare because that would be unfair. All those rich pricks on the other hand…

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  28. tom hunter (4,568 comments) says:

    How long do you think it will be before Comrade Minto’s suggestion of a 100% tax rate on earnings over $200K starts getting mainstream air-play?

    Oh, I’d say we’re no more than one riot away from that discussion starting. :)

    On the serious side, I would not come back were I in your position until you can substitute assets for hours. Hell, the reasons I’m staying are that I built up that situation, it’s comfortable, and my second home of Chicago/Illinois is in even worse shape than NZ.

    Having said that I can’t see things getting better here – only slowly, steadily worse, so I am making plans that can be executed quickly in the next few years – more quickly than pollies can move legislatively.

    For all the talk of controlling government costs it amounts to nothing more than chipping away at stuff; “good”, traditional conservative penny pinching that will be undone in a heartbeat when Labour win in 2014 or 2017. All the institutions will still be there and crying out for help after the lean years of Bill & co. Much easier to dump money into something that exists than create it from scratch, just as it’s much harder to get rid of a government body once created, as the Left well know. For all their bitching about Key they’ll probably be quite grateful when they regain power: he’ll have actually paved the way for them to push further on. And of course the real biggies – healthcare, Superannuation and social welfare – will still be in their pay-as-you-go cashflow world, with limitless demand growth built in.

    They’ll just be doing all this without me and my money, or that of my friends – or yours.

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  29. wat dabney (3,724 comments) says:

    Anyone can be a goofy borrow-and-spend populist if they choose. There’s no skill or merit in that.

    To think that the repeal of the ban on incandescent light bulbs is as far as this man is prepared to go in rolling back the bully state. That literally was the high point of his administration. Pathetic isn’t it.

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