The government simply setting a debt target for its fiscal management makes no sense. Better to set a Crown Net Worth target which reflects the entirety of the Crown balance sheet. The National Party promises to bring net core Crown debt down below 40 percent of annual GDP. Labour promises to reduce net debt to…
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The run up to the election is the silly season; is there any point in taking most of the tax proposals seriously? It’s the silly season when campaigning politicians repeatedly display their ignorance. Perhaps the most famous instance was NZ Party leader, Bob Jones, claiming in 1984 that floating the exchange rate would eliminate the…
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ACT ‘s neoliberals are still trying to sneak in a change to the constitution. When ACT – the Association of Consumers and Taxpayers – was formed, its then party leader, Roger Douglas, with an optimistic exaggeration which marked his time as Minister of Finance, announced that he was sure it would get more than 50%…
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Do its Property Right Provisions Make Sense? Last week I pointed out that it is uninformed to argue that the New Zealand’s apparently poor economic performance can be traced only to poor regulations. Even were there evidence they had some impact, there are other factors. Of course, we should seek to administer effectively a system…
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The invitation to comment on the proposed Regulatory Standards Bill opens with Minister David Seymour stating ‘[m]ost of New Zealand’s problems can be traced to poor productivity, and poor productivity can be traced to poor regulations’. I shall have little to say about the first proposition except I can think of a lot of New…
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The underlying economics of the Fair Digital News Bargaining Bill rests on intellectual property rights. I have written elsewhere about the tension between information as a public good which economic efficiency requires to be freely available and yet, because it is costly to produce, may require payment to those who create the information. Any practical resolution of…
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The Fast-Track Approvals Bill enables cabinet ministers to circumvent key environmental planning and protection processes for infrastructure projects. Its difficulties have been well canvassed. This column suggests a different way of thinking about the proposal. I am going to explore the Bill from the perspective of its proponents with their focus on short-term material output…
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The Sorry Story of Earthquake-Prone Buildings. The Treasury requires that when new or amended legislation is proposed, a Regulatory Impact Statement (RIS) be provided – ‘a high-level summary of the problem being addressed, the options and their associated costs and benefits, the consultation undertaken, and the proposed arrangements for implementation and review’. In its hurry…
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A comparison of the coalition party agreements shows commonalities but also some serious divergencies. They are mainly about returning to 2017 when National lost power. The two coalition agreements – one National and ACT, the other National and New Zealand First – are more than policy documents. They also describe the processes of the new…
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Public policy frequently suffers because we don’t look at alternatives. Thus far the Labour Party’s only ‘new’ election (economic) policy is to remove GST from fruit and vegetables. Even the accompanying promise of adjusting Working for Families is much in line with what it has being doing in the last six years. It is also…
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A canter through some of the issues facing tax policies. The Treasury experienced vigorous internal debates before Rogernomics. One was over the purpose of taxes. Eventually, a senior economist, notorious for his common sense, settled it. There it is in the 1984 Economic Management: ‘The purpose of of any tax system is to raise revenue.’…
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Its principles may involve outcomes which are not in the public interest. The ACT party election manifesto will propose to introduce a Regulatory Standards Act to set a higher bar for new regulation, and test regulations against the key principles of the Regulatory Standards Act. To make my position clear I have had doubts, going…
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Whatever the damage, especially to the British economy, Brexit has done us a service by illustrating the complexity of trade. Brexit is the only example we have of two closely integrated sophisticated economies severing trading ties. The European Union and Britain still do not have tariffs or import quotas between them – the stuff of…
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The government’s recent housing package may work; will it do enough? Trick Question: Does New Zealand have a capital gains tax on housing? If you ask the Prime Minister she will say not. It is true that her government is increasing the scope of the ‘bright-line test’ on non-family homes to ten years. That means…
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A new biography of James Buchanan, a founder of economist’s public choice theory, suggests he was not only anti-democratic but was working with others to revoke democracy in America. The work of economist and social philosopher James Buchanan (1919-2013) came to prominence in the mid-1980s when he was awarded the Economics Prize in honour of…
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Effective markets are underpinned by the government. The interventions may be sophisticated and well-thought through or they may be clumsy and ineffective. The neoliberal rhetoric of ‘free markets’ leads to the latter. In a recent Metro article, Matthew Hooten wrote ‘globalisation combined with free markets has been the most successful economic and social system of…
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Jenny Shipley says the middle class has captured the welfare state. But did she understand what the welfare state actually meant before she began attacking it? In her interview with Guy Espiner, Jenny Shipley regretted that the ‘middle class’ were still beneficiaries of the welfare state. Now the term ‘class’ is a summary of a…
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This paper on public debt strategy is published as an AUT Briefing paper. It is available here.
AUT Briefing Papers May 24, 2016 As a general rule, New Zealanders want more public spending. Surveys (such as the 2014 Election Survey) show consistent support for increases in spending, particularly in the areas of health, education, housing, law enforcement, public transport and the environment (in that descending order) as well as favouring reduced income inequality….
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Is the fiscal pact between Labour and the Greens a defeat for the left? The parliamentary left seems cowed by the neoliberals if the fiscal pact between Labour and the Greens is anything to go by. This column focuses on their fourth promise which observes that ‘Core Crown spending has been around 30% of GDP…
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