69 Comments

The TEC has just thrown NZ tertiary education further under the bus.

Can we think of tertiary education in NZ as a declining industry, in the way, say coal, was in mid-late 20th C England? Therefore, can we speculate about coming decades, with NZ being gradually intellectually hollowed out (apart from importing some educated talent) and alongside this an erosion of the very country, until we either live in some sort of small business capitalist utopia, or a sort of South Sea's Hillbilly ghost town.

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Thanks JCA. How was tertiary education thrown under the bus? And the TEC?

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Ah. I had missed that. The usual Treasury-led suspects focused on keeping borrowing and net debt down, in order to protect a credit rating and keep interest rates low so median voters can make leveraged, tax-free gains on land values.

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Treasury seems to be the evil villain in so many issues over the last few years. Each time a policy is not liked, the opposition invariably points to the Treasury advice, which is always cautious and conservative. Treasury's mindset makes it difficult for ministers looking for non-quantifiable benefits or longer-term outcomes to get "good marks" from Treasury's analysis. Not sure whether any progressive government could roll out its projects in such an environment. Fascinating, but frustrating.

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It's frustrating because treasury isn't an elected body. The govt is. And the govt should set the tone, the vision, the pathway, and treasury needs to provide advice as to how this could be achieved not why it couldn't.

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A day or two ago I ploughed my way through a chunk of the IMF Article 4 statement on NZ's financial position. My out-take is that the entire mainstream professional economics sector is "standing over" democratically elected government like some despotic C19th schoolmaster.

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As the parent of a young disabled man I'm quite disturbed by National's attitude to this particular community regarding the use of public transport. They seem to have no idea of how so many people in our country live - not necessarily by choice but through need. 25% of the population have an impairment of some sort and with an ageing population - the one thing we do need is efficient public transport with a long term investment across all parties - otherwise we ignore the needs of so many and for what?

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Thanks Colleen. I agree. We need to do much more, not less.

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The trouble is our dependants are ALWAYS the last to be considered. An after thought, an add-on. It is so insulting. If I tasked Mr Luxon with my concerns - he would no doubt say ....Oh no not them. But disabled people are very rarely front and centre of policies. Parents like me have fought for years now for inclusion - it breaks our hearts when we see wannabe leaders and politicians not 'get' the diversity that they need to consider - every single day they are in power. I feel like it is a step back in time - maybe to the 1980s. And once again - people like me and my friends have to go out there and fight the next battle.

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Same in our family, and definitely a disconnect with the reality.

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TOPs Ilam poll result is a bit of a red herring isnt it?? The poll was asking who "which party would you choose for your party vote" to Ilam voters. The question should be which candidate are you choosing as people dont automatically vote for the same candidate and party vote

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Just checked Google news results & The Kaka seems to to be the only 'media' organisation actually reporting correctly on the question posed in the poll ( Well done Bernard!) Which was "If a General Election had been held yesterday, which political party would you have voted for, with your party vote? " Every other media outlets reported it was a vote for candidates not the party vote.

Well done the Tax Payers Union & Curia for ensuring the message of your vote for TOP is looking like it is wasted when that isnt what the poll results actually said. Dirty politics or lazy media??

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It's frustrating. I need to make a decision as to which candidate to vote for and the last thing I want is for the grasshopper to win because people think the TOP ilam poll was dodgy.

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A bit of a "gotcha" from the normally measured Thomas Coughlan: https://www.nzherald.co.nz/nz/politics/kainga-ora-spends-more-than-300000-a-year-renting-seven-high-end-computer-terminals/DI3KB4SYOBAR7KVSOILD7SZSXA/

But do you think Kianga Ora should be raising its own debt or should its debt-raising be done by Treasury?

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Treasury, in my view. There’s 66 basis points of cost added on for no discernible gain.

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Hi Bernard - given the RBNZ is threatening retribution with interest rate rises if we don't halt inflation, won't the National's proposed policies of tax cuts (that increase discretionary cash for the middle), and policies that potentially refuel property inflation force the RBNZ to take all that extra cash back through increased mortgage rates?

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Great question Paul. In theory, National set it up to be fiscally neutral, so they’re taking away as much cash as they’re putting in. The devil will be in the detail, but I suspect the overall effect of National’s plan would be contractionary, especially if you include the inevitable investment freezes at NZTA and KO in the initial stages. But there’s another wildcard. I think a clear National/ACT win would drive up house prices 20% the next weekend. That wealth effect could spark a new surge of spending. The Reserve Bank might have to react to that.

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Yep house price increases for sure. Crazy

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it/that is what Luxon and his cronies want.

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yes, the raging inferno of increasing dwelling/house prices will happen/occur again and this will result in the Reserve Bank increasing interest rates to crippling levels, but residential rental property owners don't give a stuff because they can claim all mortgage interest from their tax.

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National and Act party housing and tax policies WILL reignite/relight/restart the raging inferno of increasing housing prices!!! John Key and the NZ CEOs of the oz banks and all their cronies want housing prices to increase because then 1) the mortgages they issue will be larger, 2) the RBNZ will continue to increase interest rates (which is what the banking #*#*s want, because then they can blame Orr) and 3) the banks will increase their interest rates (blaming Orr) and consequently continue making colossal/enormous/huge/massive grossly excessive profits.

the RBNZ doesn't get the cash/money; the banks get it.

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Kia ora Bernard - in an earlier post this week you referenced an eye-popping graph of temperatures which you made the point ought to have been on the front page of the Herald that day. I am not a conspiracy nut, but I am very curious on your views on the following - with all the (reputable) evidence consistently piling up, why don't our various media report on the climate crisis in a more open and robust manner? The Fourth Estate is a part of the political process, so it is their role to lead, create and inform debate (they do in plenty of other spaces). Is there any tension at all in newsrooms across the country about what they are covering and what they don't? Bad news typically always sells, so it cannot be fear of advertiser or subscriber loss...and yet these topics are only covered tangentially at best and certainly not consistently pursued. The solutions we will need will be complex and multi-faceted and will have national, international and local dimensions but there just appears to be a big.... well, nothing...

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Thanks Simon. I don’t know why it’s not on the front pages. I would lead with it if I was the editor. But I suspect the particular people involved, and I know most of them, don’t focus on it as closely as I do. It’s tough because really going hard on it would be quite dispiriting and could be seen as alarmist. I prefer to focus on the constructive. Even if we’re too late for 1.5 degrees, limiting the rise to 3 degrees, rather than 3.5, is worth it.

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Thanks!

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Would you be able to provide your thoughts on TOPs poll results and potential approaches they need to take going forwards.

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If it’s close, Raf should beg Labour for a nod and a wink. It’s getting late though. Labour haven’t done a ‘deal’ like that for a long time. Even National seem reluctant to do them anymore. They’ve quietly stopped giving ACT a freebie in Epsom, although it helps National that ACT don’t need a leg up anymore.

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No offence to Hamish Campbell nice chap and all but Raf would have walked that seat for the Nats

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I wondered if you had any insights into the voting patterns of people who have recently migrated to Aotearoa. I remember reading something in the last few years which stated that 75% (or thereabouts) of Chinese migrants voted National.

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Great question. I need to do some digging in the last NZ Election Survey. At first blush, a lot don’t vote and many will vote with whoever is in power. But I need to check. There is an active ‘Blue Dragon’ section in National, which is very, very CCP aligned.

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Nats make a concerted effort to connect with immigrants. Wayne Brown did this very well in Akl mayoral elections. Labour missing a trick. Nats going hard for Indian trade deal gives it viability with large Indian diaspora. Think the migrant communities are under polled as well. Don’t be surprised if Nats hit 40 because of it

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Oh and don’t forget it was the labour govt that separated many migrants from their loved ones for long periods during covid, stopped processing SMC visas, and blew out immigration nz processing times so must be some votes in there for the Nats.

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Nats had suspended parent resident visas long before Covid. Labour resurrected this is 2022 so gain some kudos with long term migrants

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As an Asian migrant (>10 years), my conversations with other migrants reveals many are unhappy about the increased attention to Te Tiriti issues (which is why most of them are vehemently against the Greens). They feel unhappy at the Maori and Pacific Islander communities receiving more attention, even though to any rational observer, that is the sensible thing to do. They are thus very susceptible to dog-whistle political appeals, which is very sad. I'm quite sure National's focus groups have found this out and they are thus using it in their campaigns. I have tried pushing back against some of these views, but to no avail.

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Wow, that is incredibly insightful, thank you for sharing! I did wonder if something along these lines might have a contributing factor - e.g. not realising prior to arriving in Aotearoa that Maori have worse outcomes in many areas due to the legacy of colonisation, etc.

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Interesting thought that if the NZ population does grow to 10m by the end of the century - or before if current immigration rates kept up - then the demographics of the country will be significantly different.

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The Chinese economy, especially the housing market, isn't looking good. How could this effect NZ and are any politicians acknowledging it?

Sorry if you've mentioned this in a previous Kaka, I haven't been able to read them all recently 😬

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Thanks Hamersley. There has already been a hit to dairy prices that will take a couple of billion out of the economy. But it’s nothing too dramatic. The fall in the currency has softened the blow. I think the jury is out on how long the China slowdown goes on for before the CCP pull the infrastructure lever. There is no RMA in China.

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As a subscriber, I am happy for you to share your research and thoughts as widely as you can and still survive financially...your voice of reason is vital right now.

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Thankyou Barbara.

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Good afternoon Bernard,

About Inflation, Cost driven & Greed-flation; Isn't it time for New Zealand economist to seriously focus on the Macroeconomics of how individual good & service pricing decision making process is actually occurring, rather than the Macroeconomics view which seems so dominant in mainstream discussion today?

See

https://substack.com/@nzheretic/note/c-39231846

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Absolutely. We’re starting, but there’s a whole world of groupthink to overcome.

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Has any serious thought been undertaken by the labour next generation (Edmonds/mcanulty/Williams) as to why the public service has failed to deliver bang for its additional buck? Did Grant’s delivery unit make any discernible difference?

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The additional buck argument is dubious, our public service is the same size per capita as it was 20 years ago

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Not interested in party political hackery. I’m interested in why the governing Parties’ ambitions have been thwarted (in part) by a public service that is either underfunded, badly led, or unable to deliver what’s its political masters require of it. More importantly if it is possible to diagnose the failure what a future government can do to improve it?

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Don’t forget the Public Service sees itself as the guardian of the still-in-place Public Finance Act, which forces a ‘fiscally prudent’ approach, which Treasury has interpreted to mean a certain debt ceiling and surpluses whenever possible.

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Centre left govts will struggle to receive a mandate for a bigger state and higher taxation unless they can deliver improvements that can be seen and felt. In a Westminster system what the public service want should be irrelevant. Sounding very Alastair Campbell 1996 right now

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Is the Westminster system capable of delivering effective government now and in the future ?

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We’ll find out in 6 or 9 years…if neither Nats or Lab can get anything done beyond cutting tax/putting up the minimum wage may well be time for the patient to have a drastic operation

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The one area I am familiar with is water quality / quantity in Canterbury. The public want it but vested interests have captured the regional council bureaucrats so rules are either too week or not applied.

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Certainly the US Right are keen for a clear out of the civil service.

'With a nearly 1,000-page "Project 2025" handbook and an "army" of Americans, the idea is to have the civic infrastructure in place on Day One to commandeer, reshape and do away with what Republicans deride as the "deep state" bureaucracy, in part by firing as many as 50,000 federal workers.'

https://www-pbs-org.cdn.ampproject.org/v/s/www.pbs.org/newshour/amp/politics/conservatives-aim-to-restructure-u-s-government-and-replace-it-with-trumps-vision

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Great question. Short answer is no, but it’s hard to nail down why. There’ll be lots of excuses. National/ACT may well find the same inertia stops them from doing stuff too. The status quo is a very powerful thing.

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That inertia should worry us all. There’s a scoop for your solutions based journalism - deliverology. Otherwise the Westminster system breaks down and the newly elected govt needs to appoint a whole swathe of the top tier of the civil service (US style) or become very creative with your list rankings and fill slots 11-20 with senior specialists in transport, power, education, health, economics etc knowing that they’ll be the minister in charge of certain portfolios. Leave the politics to the politicians and governance to sector experts.

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I am only a tiny fish and I’ve done short stints in the public service. My observation is that you have just enough to do what you have to deliver. So doing extra/different things is tricky from a resource perspective. Everyone battens down the hatches/head down elbows out so it can be difficult from a culture perspective too but that’s much more varied.

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Have you tried the Twitter/Thread alternative service Bluesky yet?

https://bsky.app/

At the moment it feels like Usenet Thirty years ago on the cusp of the Eternal September

https://en.wikipedia.org/wiki/Eternal_September

David Mohring

@nzheretic.bsky.social

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I’m sticking with Notes and Chat. Have pretty much given up on Twitter. Only so many social media I can commit to. Beginning to wonder if there is any net benefit from all of them.

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Yes , but I still think that New Zealand would be far better if it had its own service within New Zealand. see

https://substack.com/profile/58285908-david-mohring/note/c-39386564

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Deleting social accounts is the only way we can fight them. Everyone denies their addiction by finding a reason to keep it open. You're close now, do it.

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"I've out lived USENET, FidoNet & Bulletin Boards.

Meta/Facebook is already dead to me. Twitter is not looking that healthy."

https://twitter.com/NZheretic/status/1588756388935004165

Most people feel a real need to connect with others, services rise when they meet that need and fall when the signal to noise ratio gets too high or the abuse gets too numerous to deal with.

Just like you have spam filters on your email, in the near future you will probably need some sort of filtering system for all your online communications.

https://twitter.com/NZheretic/status/1618868123138154497

https://www.reddit.com/r/onguardforthee/comments/vz7o9y/comment/ig6uhzu/

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How much overall does the National proposal take away from climate change initiatives and public transport to keep the cars and cows happy?

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$2.5 billion.

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Government is failing to provide inflection points for responding to the climate crisis... what’s next?

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In theory, voters will in aggregate force a change in policies…

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Hello Bernard, I have 2 related questions.

1. What is your view on Luxon's statement: the "government has been the second biggest spender of government money per capita in the world". This would be an earth shattering statement of true.

The OECD figures from their site linked below say that we are in the lower 1/2 of the OECD, just above Turkey and Mexico and on par with spendthrift Japan. Have we seriously jumped to number 2? Not at all according to statistica. Granted, it has been marginally less during the National years...which may explain in part why the health and education sectors have been in decline. https://www.oecd-ilibrary.org/sites/6c445a59-en/index.html?itemId=/content/component/6c445a59-en

https://www.statista.com/.../ratio-of-government.../

2. What is your opinion on Nat Act supporter Mathew Hooton's claim that "We now have among the worst productivity in the developed world" (also not evident in the OECD stats), and that "New Zealand will be the worst-performing economy in the entire world in terms of GDP growth" other than Equatorial Guinea)...the entire world?? https://www.nzherald.co.nz/business/election-2023-nationals-tax-plan-is-a-cynical-con-job-matthew-hooton/ECXSZ52YNJFD7FSJA6LVJ6DOWU/

Everything that I read is that increasing spending (and taxing to pay for it will increase productivity if spent wisely (such as more money for tertiary)

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