A revealing speech

The speech by this weekend was very revealing, but not in a good way. The Herald reports:

Mr Little said in the eight years under a National Government, the proportion of economic growth that went back to working New Zealanders in wages had dropped from 50 per cent to 37 per cent. Instead he accused National of favouring “those at the top” through policies such as allowing foreign trusts and tax on multinationals.

These are the same policies of course that existed under the last Government, but lets ignore that for now.

Stuff further reports:

Little said just 37 per cent of economic growth had gone into the pay packets of working families since National came to power – down from over 50 per cent under the previous Labour government. 

That meant the average family had lost out on more than $13,000 under the Government, and would miss out on $50 a week this year.

The use of this statistic is rather revealing, as to both how desperate and also how ill informed Labour are. Three things I’d note:

  1. In all my years of politics I’ve never known a voter to talk about the proportion of economic growth that goes to wages. 99% of NZers don’t even know such a statistic exists lets alone give a flying f**k about it. I’m not sure I’ve even hear of it before. It reeks of desperation in trying to find an obscure economic statistic that they can campaign on. Voters care about jobs, wages, hospitals, schools and families – not the proportion of economic growth that goes to salaries. Wages have in fact risen twice as fast as inflation in the last seven years.
  2. Little seems to believe that the Government sits around the Cabinet table and determines what share of economic growth will go to wages. The Government does not create the economic growth and decide which sectors generate it and where. While policies have some small impact, the over whelming factor is decisions made by tens of thousands of businesses.
  3. Use of this statistic goes against Labour’s efforts to show they understand the modern economy. They are effectively railing against entrepreneurs and innovation. Why might a smaller share of economic growth by going to salaries. Well companies like Xero and Uber. They’re great for the economy (and customers) but according to Little they are robbing working NZers of $50 a week.

So Labour have managed to look desperate, ill informed and backwards in one speech. That’s quite an achievement.

Claire Trevett reports in the NZ Herald:

The centrepiece was a very convoluted piece of research about the proportion of economic growth returned to workers. Labour had concluded New Zealanders were getting $50 less a week than they would have been.

It was effectively meaningless beyond showing what clever clogs they were to have worked out such a thing.

Maybe their staff were so busy working on finding this obscure statistic, that they didn’t have time to do due diligence on the home they claimed had 17 people living in it!

It also opened Little to questioning on how Labour would get that back into the pockets of those workers.

Ban tech companies?

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