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Tuesday, 22 May 2018

Am I suffering the post budget blues?

What’s this feeling that’s been afflicting me in the week since the budget was announced? A strange unease tinged with nervousness and just a hint of apprehension.

Maybe it’s just me as the general tone form the media has been themed around the message of “Boring but good” noting that Grant Robertson cancelled the previous National governments proposed tax cuts and used the savings to pump up education and health (both areas that were needing it).

And the ongoing response of the Coalition government to its budget and it policy prescriptions overall still hinges on the valid argument that National had nine years to fix these problems but did not and in fact made them worse by focusing on the mantra of “surplus” at the cost of everything else.

Simon Bridges and Co can moan all they want but that inescapable fact has now been exposed and areas of NZ which have desperately needed more and better funding are finally getting it under the Coalition and its first budget. In a budget with no really obvious poke points National has had to suck it up and look for minor points to score while a bit more sand slips out from the foundation under Bridges and the free-market zealots start muttering Judith Collins name like they are summoning some demonic spirit*

Of course it’s not all been rainbows, sunshine and lollipops the budget has had its detractors outside of an opposition still smarting from the shock of being in opposition with teachers not happy at having to wait several years for funds the feel they need now and things like 100 million for the Americas cup and NZ Firsts extremely dubious tax breaks for horse racing but these are really minor quibbles and while I don’t like them they are neither individually or collectively enough to give me that feeling in my guts that something is not right.

It’s not even the fact that things like the government reneging on its promise to make doctors visits cheaper by 10 dollars or making Kiwibuild homes open to anyone (ie not having a means test for what is in effect state housing) while the housing hernia simmers sinister like in the background like a cancerous growth ripe to explode.

Perhaps the unease is that after nine years in the political wilderness and campaigning on being an alternative to National and starting out with comments about capitalism being a “blatant failure” this budget has been little more than another National budget with Robertson using the extra funds from the tax cuts to fuel the increased spending rather than presenting a budget which actually wants to address the issues facing NZ.

And if we dig deeper its Labour shackling itself with those bloody Budget Responsibility Rules which seems to be a big part of the unease I am feeling.

But I hear you say, if they don’t then they will just be another tax and spend government or simply blowing all those surpluses that National worked so hard to achieve (even if it was at the cost of most of this countries well being – but hey the balance sheet looked good didn’t it?) and you’d be right Skippy, you would be right.

It’s not that BRR are intrinsically wrong but the context of Labour (and lets not even start to say that either the Greens of NZ First know anything about how to run a budget) but that in sticking to those rules Labour is in effect playing Nationals game albeit in a lite form.

And when needed changes to tax reform in NZ (my personal opinion is for the increasing corporate tax rate or taxing the rich into oblivion in a time of acute inequality or even just making a genuine attempt to ween Kiwis off housing speculation by bringing down the housing market to realistic levels) are being poo pooed in advance by Labour in favor of some tinkering to the tax code it’s clear that this budget was not real about economics or money it was about politics.

This budget was in part a means of keeping the coalition on an even keel (an understandable necessity in a fully-fledged MMP govt) but also about keeping the “market” and the “business community” on side because if anyone will be planning and funding the counter revolution against a government which wanted capitalism to have a “friendly face” it will be them who will have the whip in their hands and National at their beck and call.

There have been claims that Robertson is holding back some funds for the 2020 election and that may be true but then it’s just another lolly scramble and just Labour playing the political game rather than rewriting the rules to fix what is wrong with NZ.

I still can’t place my finger on it but I think something happened with this budget and without knowing it we (or more correctly this government) turned a corner and many of the signs ahead show a government paying lip service to fixing the disease that afflicts NZ while secretly keeping it alive.

Ardern and Robertson are playing a dangerous game here as once the idealism of the election cools and more and more promises get broken or this government holds too close to the last governments economic line then we may actually get the dreaded post-election slump kicking in.

For now that has not happened, yet, but making the argument that the solution to the radical strides to the right made in the 1980s can only be fixed by cautious baby steps back to the middle is simply saying capitalism has failed NZ but that the market can’t be tamed and the government using the cancelled tax cuts as a political smoke screen for an agenda which is less about fixing the future and more about political preservation (specifically Labours) because if those tax cuts had not been there to cancel it’s hard to image what good news this year’s budget would have delivered and even still I wonder if this year’s budget is really enough to offset 30 years of neglect.

And speaking of babies, am I just suffering the political equivalent of post-natal depression? Will it pass in time or will the depression and doubt linger?

*-Perhaps they are.

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