Peter Lyons is a teacher of economics. He writes in the NZ Herald how Dr Cullen’s surpluses are more to do with being miserly than about wise management:
But the sheer size of this surplus represents an economic distortion largely due to over-taxation of the private sector.
A Budget surplus of about $8 billion equates to $4000 for every worker in the New Zealand economy.
A key implication of Dr Cullen’s Budget surplus can be illustrated using the analogy of a household.
In this household the wife (tax-paying public) is the primary income earner and the husband (Government) is a miserly hoarder.
The husband permits the wife a minimal amount for running the household each week.
Some weeks she is forced to borrow from the local loan shark just to make ends meet. The more she borrows the more interest she has to pay.
As she slides further into debt she de-velops a debtor mentality of living for the moment. She continues to borrow and spend.
Meanwhile her husband gleefully counts his hoardings acquired mainly from her income. He is reluctant to increase her allowance in case she becomes more extravagant in her spending.
A great analogy. Dr Cullen is the abusive controlling husband. He isgnores the fact that we earn the mone, not him. He treats it all as his, and will only give back to us the amount he thinks we should have.
Some health and education professionals are now eligible for Working for Families assistance if they are not too proud to receive Government welfare.
There is something disturbing about middle-income-earners being reliant on Government assistance to be able to raise a family, particularly during a period of economic prosperity.
Indeed. But this is what the Government wants – over 50% of all NZ families reliant on the state, to create a permanent majority in favour of ever increasing state welfare.
Dr Cullen need not be proud of his huge Budget surplus. It does not indicate prudent economic management. It represents economic distortion in the form of over-taxation.
It is also a contributing factor to the huge debt mountain the New Zealand public has accumulated over recent years.
It’s a sound point, not often made. The Government goes on abotu the high level of private sector debt, but contributes to the problem by refusing to give the private sector (you and me) their over-taxation back.