All politicians, even those who say otherwise, raise taxes and spend money. The question this election is - what do they spend the money on? Politicians need to tell us not just what they will do but also explain why it will make a difference.

It was an odd thing to say. During an interview with Labour leader Jacinda Ardern, Newstalk ZB host Mike Hosking labelled her a "tax and spend" politician. It wasn't a compliment. But doesn't that label apply to all politicians? They raise tax and spend it. 

Yes, some politicians pretend otherwise. They talk about government being the problem and put their faith in the market - but they still raise tax and spend the money. 

The real question ought to be - what do politicians spend their money on? 

This question is now top of mind in most democracies around the world because voters have tired of, on the one hand, being told that governments can do nothing to make them secure in the face of globalisation, and, on the other hand, being told that getting the deficit down is the priority.

Meanwhile the rich keep getting richer. 

It is the failure to spend money (wisely or not) that has driven voters in many countries to look to the left and right of mainstream political parties in search of someone who will "do something" to address the problems they face every day. Finally, mainstream parties have begun to wake up to the fact that if they want to retain popular support and call a halt to the lunacy of people like Trump, they had better start talking about what a government can do to make a better life for their citizens. 

This is what has happened in New Zealand politics with the arrival of Jacinda Ardern. For the past nine years, the National Government has made deficit reduction its goal while underfunding almost everything. To take just one example - health. How is it that getting the deficit down as soon as possible is more important than building a hospital for the people of Dunedin?

The current hospital does not function. Patients are denied an operation because there are no beds available. For years nothing was done. Even now that the problem has been acknowledged, the best that is on offer is a new building in 7 to 10 years!

National believed it could focus on deficit reduction because it had no effective opposition. No doubt it also held to the view that they did not want to be seen as a "tax and spend" party. There may have been complaints about everything from infrastructure to housing, poverty, violence, regional decline, education, health and on and on - but there was no one to take up the cause. 

The arrival of Jacinda Ardern has seen a revival of Labour as a major party - one that said it wanted to spend money to resolve the many issues confronting New Zealanders. All of sudden National had a serious contender with a different message. They too realised it was time to spend money. 

So let's not go through the next few weeks saying one of the parties likely to lead a new government will "tax and spend" while the other pretends to be something else. The mood has shifted. As one first-time voter was reported as saying, "I don't want to just grow up ...knowing that these problems are still there...I want them to actually make a better future...".

She spoke for the many, not the few who already have a better future. If politicians are to do better they will have to spend money, so the question remains - on what?

The answer might seem obvious. Spend money on the things that have been ignored over the past nine years. But that is not a sensible answer. No government will have enough money to pay for the backlog of neglect that has been accumulating. Neither should they. Just spending more money is not the answer to the challenges facing New Zealand. 

What we need is bold thinking about the kind of economy and society we want. Setting out a direction for the country will prompt questions about the type of infrastructure, the skills, and technology we need to transform the economy. We will have a clearer idea of why we should have a clean, green environment. What we can expect from the state and business will take shape. Our support for strong public institutions, strong families and strong communities will make sense. Paying our fair share of tax will seem more like an investment. The reason we seek a role on the international stage will have purpose. 

These, then, are the central questions for all parties this election. What kind of future do you see for New Zealand and how do you intend to get there? 

Answers will require a lot from our politicians. Good.

They should have to explain not just what they will do but why it will make a difference. Amidst all the smug talk about the economy performing well (it rests on the thin ice of immigration), there is an understanding that to be successful in the 21st century substantial change is called for. It will be tough.

Explaining what we are spending and why will be essential. 


Comments (3)

by Charlie on August 25, 2017

Thank you for your Labour Party promotional piece. Now to tear it to pieces:

"Meanwhile the rich keep getting richer"

...and what exactly is the problem with that? The rich commit far fewer crimes, generally don't bash their kids, recycle their refuse and provide the majority of the tax revenue to the government. If you want to look at a country with very few rich people go check out Venezuela. We need rich people.

The problem isn't rich people, it's poor people. Therefore the Left's concern over wealth and 'inequality' is pointless (or is the real objective is to make their voter base permanently angry and thus keep voting Left?)

The real question we need to answer: Why does a core group of beneficiaries remain stubbornly poor across the generations, despite endless welfare and other assistance? The rest of NZ isn't holding them down. Au Contraire! We're all forking out a small fortune to prop up their destructive life style!

Address that and your friends may get my vote


by Ross on August 26, 2017

The rich commit far fewer crimes

Hmmm can't say I've seen any research about that. It's probably true to say that the rich don't get charged as often as the poor (however both the rich and poor are defined). But of course that doesn't say anything about who commits offences. The rich might be better at hiding their crimes and, if caught, can afford expensive lawyers that the poor don't have access to. 

The SFO has estimated the total cost of economic crime at between $6.1 billion and $9.4 billion.

"By far the biggest component of that $6.1 to $9.4 billion was an estimated $2 billion a year in tax fraud - benefit fraud by comparison was thought to be about $80 million. The report estimated that just over $100 million or 5 percent of that $2 billion a year in tax fraud was being detected. The figure was close to 30 percent for benefit fraud."$9-point-4bn

by Tim Watkin on August 27, 2017
Tim Watkin

Charlie, I'd like to see your evidence for the claim that richer people bash their kids less. Can you please provide that, because it contrary to what I've heard from experts.

I'm also curious as to how big you think this core group of beneficiaries actually is. The number on long-term - indeed generational, welfare I suspect aren't as big as you suspect, and those who are, are usually on for a long time because of untreatable medical conditions and the like. The small fortune spent on the people you describe is quite small indeed.

National Party ministers often say that the vast majority of beneficiaries bounce on and off in stress point of life (losing jobs, new child etc), rather than staying on.


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