NZ POLITICS DAILY: Slump capitalism

‘Slump capitalism’ is a term that might be applied to what New Zealand and the western world continues to experience economically.

Although there are occasional bursts of economic growth, the state is hamstrung by endemic economic crises, which make it very difficult to deliver the level of social services and economic interventions desired by most voters.

Tuesday’s PREFU Treasury document showed just how dire things are, and how much the parliamentary parties are restrained – or should be restrained – by a very negative economic environment. Although there’s a lot of mixed messages and a mostly rosy-tinted view of things in the PREFU, there is also some admission of just how bad things might get.

This sober admission is concentrated on by the following very good reports – Audrey Young’s Surplus 'on track' bar disaster, John Armstrong’s Sobering message amid revelry, Tracy Watkins’ It never hurts to plan for worst-case scenario, and editorials in the Herald and Press. Also check out Keith Ng’s PREFU 2011: "What credit downgrade?" and Gordon Campbell’s On the Prefu.

But the best summary of the PREFU comes from the NBR’s Rob Hosking who shortens the 118-page document to 19 words: ‘Things will get better, unless they get worse. Here’s some numbers that say both. See you after November 26’ – see: Govt spending cuts yet to really start.

These writers have quite rightly picked up on Treasury’s admission that there’s a strong chance that an economic meltdown might hit New Zealand, and even without that occurring, things are looking rough for whoever governs over the short to small term.

But there’s also a sense in which the various commentators and editorial writers seem very unconvinced that the various parliamentary contenders have really risen to the challenge of dealing with New Zealand’s slump capitalism.

Although Labour and National do a very competent job of continuing to lower our horizons for what we might expect from them, they really aren’t providing much to voters beyond the politics of austerity – and even then some of the economic policies are rather vague.

Although there is a lot of talk about a ‘clear difference’ between Labour and National in the campaign, much of it is simply magnified by partisan rhetoric. Jane Clifton is actually quite right in her Listener column, which is aptly entitled Labour and National without economic strategy.

When it comes down to the crux of it, the public sector is in for more than a bit of ‘trimming’, and this seems likely to happen under either Labour or National after the election. For a thorough report on what’s been happening in the core public service, see Danya Levy’s Is our state sector more efficient?. Also worth reading for another account of the impact of ‘slump capitalism’ is Catherine Harris’ Youth unemployment a growing problem.

Of course the election campaign rolls on, and today’s important items include Claire Trevett’s Labour ditches big campaign launch, Andrea Vance and Danya Levy’s Goff absent from Labour billboards, Alexia Russell’s Election campaign starts in earnest, Andrew Balemi’s All about election polls, and finally: iPredict’s World First: iPredict Election 2011 TV Series.

Bryce Edwards, NZPD Editor (bryce.edwards@otago.ac.nz)

Today’s content:

PREFU and the economy

Jane Clifton (Listener): Labour and National wihtout economic strategy

Keith Ng (On Point): PREFU 2011: "What credit downgrade?"

Gordon Campbell (Scoop): On the Prefu…

Tracy Watkins (Dom Post): It never hurts to plan for worst-case scenario

NZH: Editorial - Back to reality with election in four weeks

Press: Editorial - Focus turns to politics

Rob Hosking (NBR): Govt spending cuts yet to really start

Brian Fallow (NZH): Feel the G forces? Thought not